Offer to Purchase
for Cash
2,500,000
Outstanding Shares of
Common
Stock
GENERAL
EMPLOYMENT ENTERPRISES, INC.
(A
Kentucky Limited Liability Company)
The
Offer and Withdrawal Rights Will Expire at 12:00 Midnight, New
York
City Time, on
Tuesday, June 30,
2009,
Unless the Offer Is Extended.
PSQ, LLC, a Kentucky limited
liability company (“PSQ”), is offering to purchase, at a price of $.60 net per
share in cash without interest, 2,500,000 outstanding shares of common stock, no
par value per share (“Shares”), of General Employment Enterprises,
Inc., an Illinois corporation (“GEE” or the “Company”), on the terms and
subject to the conditions specified in this Offer to Purchase (“Offer”) and the
related Letter of Transmittal.
There is
no financing condition to this tender offer. This tender offer is not subject to
the tender of any minimum number of Shares, but is subject to the condition that
no more than 2,500,000 Shares may be purchased by PSQ under the tender offer. In
the event that more than 2,500,000 Shares of GEE common stock are tendered in
response to this Offer, each tendering shareholder shall be subject to a
proportional reduction of the number of Shares tendered that will be purchased
in this Offer.
Prior to
the announcement and filing of this Offer, PSQ entered
into a Securities Purchase and Tender Offer Agreement (the “Agreement”) dated as
of March 30, 2009 which provides that PSQ will purchase 7,700,000 newly issued
shares of GEE common stock (“New Issue Shares”) at a price of $.25 per share,
representing an aggregate purchase price of $1,925,000. As of the date of this
tender offer, PSQ owns no shares of GEE common stock.
A summary of the principal terms of
the tender offer appears on page 5 of this Offer to
Purchase.
This transaction has not been
approved or disapproved by the United States Securities and Exchange Commission or
any state securities commission nor has the Securities and Exchange Commission
or any state securities commission passed upon the fairness or merits of this
transaction or upon the accuracy or adequacy of the information contained in
this document. Any representation to the contrary is
unlawful.
This
Offer and the related Letter of Transmittal contain important information, and
you should carefully read both in their entirety before making a decision with
respect to the tender offer.
If you
desire to tender all or any portion of your Shares, you should either
(i) complete and sign the related Letter of Transmittal (or a facsimile
thereof) in accordance with the instructions in the Letter of Transmittal, have
your signature thereon guaranteed, mail or deliver the Letter of Transmittal (or
a facsimile thereof) and any other required documents to Continental Stock
Transfer & Trust Company, the depositary (“Depositary”) for the tender
offer, and either deliver the certificates for such Shares along with the Letter
of Transmittal to the Depositary or tender such Shares pursuant to the
procedures for book-entry transfer set forth in “The Tender Offer —
Section 3 — Procedures for Tendering Shares” or (ii) request your
broker, dealer, commercial bank, trust company or other nominee to effect the
transaction for you. If your Shares are registered in the name of a broker,
dealer, commercial bank, trust company or other nominee, you must contact your
broker, dealer, commercial bank, trust company or other nominee and give
instructions that your Shares be tendered. Any questions regarding
this procedure should be directed to the information agent, Morrow & Co.,
LLC (“Information Agent”), at 470 West Avenue, Stamford, CT 08902, or by
telephone at (203) 658-9400.
If you desire to tender Shares and
the certificates evidencing your Shares are not immediately available, or you cannot comply
with the procedures for book-entry transfer described in this Offer to Purchase
on a timely basis, or you cannot deliver all required documents to the
Depositary prior to the expiration of the tender offer, you may tender such
Shares by following the procedures for guaranteed delivery set forth in “The
Tender Offer — Section 3 — Procedures for Tendering
Shares.”
Questions
and requests for assistance or for additional copies of this Offer to Purchase,
the Letter of Transmittal or other tender offer materials may be directed to the
Information Agent at its address and telephone number set forth on the back
cover of this Offer to Purchase. Stockholders may also contact brokers, dealers,
commercial banks or trust companies for assistance concerning the tender
offer.
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TABLE
OF CONTENTS
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Page
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SUMMARY TERM SHEET
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5
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INTRODUCTION
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10
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SPECIAL FACTORS
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11
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Background of this Offer
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12
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Position of General Employment Enterprises and PSQ Regarding
the Fairness of the Offer
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12
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Summary of Communications between PSQ and
General Employment’s Boards of
Directors
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13
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Purpose and Structure of the Offer; Our Reasons
for the Offer; and Plans for GEE
After the Offer
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13
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Security Ownership of Certain Beneficial
Owners
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13
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Transactions and Arrangements Concerning the
Shares
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14
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Related Party Transactions
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14
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Interests of Certain Persons in the
Offer
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17
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THE TENDER OFFER
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17
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Section 1 — Terms of the Offer;
Expiration Date
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17
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Section 2 — Acceptance for Payment and
Payment for Shares
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19
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Section 3 — Procedures for Tendering
Shares
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19
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Section 4 — Withdrawal
Rights
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22
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Section 5 — Certain U.S. Federal Income
Tax Considerations
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22
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Section 6 — Price Range of Shares;
Dividends
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24
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Section 7 — Certain Information
Concerning General Employment
Enterprises
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24
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Section 8 — Certain Information
Concerning PSQ
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25
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Section 9 — Source and Amount of
Funds
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25
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Section 10 — Possible Effects of the
Offer on the Market for the Shares
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25
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Section 11 — Fees and
Expenses
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25
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Section 12 — Conditions to the
Offer
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26
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Section 13 — Certain Legal
Matters
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26
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Section 14 —
Miscellaneous
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27
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We are
offering to purchase a maximum of 2,500,000 shares of GEE common stock, no par
value, for $.60 net per share of common stock, no par value per share
(“Share(s)”), in cash without interest. The following are some of the questions
that you, as a shareholder of GEE, may have and our answers to those questions.
We urge you to carefully read the remainder of this Offer 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 and the related Letter of Transmittal. When used in this Offer,
the terms “we,” “our,” and “us” refer to PSQ, unless the context requires
otherwise.
Who is offering to buy my
Shares?
Our name
is PSQ, LLC. We are a Kentucky limited liability company formed specifically to
acquire shares of GEE common stock, including 7,700,000 shares of newly issued
shares of GEE common stock (“New Issue Shares”), which will result in PSQ
controlling the voting class of outstanding capital stock of GEE. We are
offering to purchase up to, but no more than, 2,500,000 shares of the
outstanding shares of GEE common stock at a price of $.60 per share. As of the
date hereof, we do not own any shares of GEE common stock, but we have entered
into a Securities Purchase and Tender Offer Agreement (“Agreement”) with
GEE which provides that we will purchase from GEE 7,700,000 shares of
GEE common stock representing approximately 58% of the post-issuance number of
outstanding shares of common stock of GEE, including certain shares that are to
be issued in connection with the Consulting Agreement entered into among PSQ,
GEE and GEE’s current Chairman, Chief Executive Officer, and President, Mr.
Imhoff, Jr. (“Mr. Imhoff, Jr.”) on March 30, 2009, for a price of $.25 per
Share, for an aggregate purchase price of $1,925,000. Our purchase of the New
Issue Shares is conditional upon the receipt of GEE’s shareholder approval and
all other conditions of the Offer being satisfied or waived.
General
Employment Enterprises, Inc. was incorporated in the State of Illinois in 1962
and is the successor to employment offices doing business since 1893. In 1987,
GEE established Triad Personnel Services, Inc., a wholly-owned subsidiary,
incorporated in the State of Illinois. The principal executive office of GEE is
located at One Tower Lane, Suite 2200, Oakbrook Terrace, Illinois. GEE operates
in one industry segment, providing professional staffing services. The Company
offers its customers both placement and contract staffing services, specializing
in the placement of information technology, engineering and accounting
professionals.
The
Company’s placement services include placing candidates into regular, full-time
jobs with client-employers. The Company’s contract services include placing its
professional employees on temporary assignments, under contracts with client
companies. Contract workers are employees of the Company, typically working at
the client location and at the direction of client personnel for periods of
three months to one year. The combination of these two services
provides a strong marketing opportunity, because it offers customers a variety
of staffing alternatives that includes direct hire, temporary staffing and a
contract-to-hire approach to hiring.
What are the classes and amounts of
securities sought in the tender offer?
We are
seeking to purchase a maximum of 2,500,000 shares of GEE’s outstanding common
stock.
How much are you offering to pay?
What is the form of payment? Will I have to pay any fees or
commissions?
We are
offering to pay $.60 per Share, net to you in cash without interest. This price
represents premiums of approximately 55.5% over the 10-day volume-weighted
average closing price of GEE’s common stock over the 10 trading days prior to
the date of the Agreement, which common stock is listed on the NYSE AMEX Stock
Exchange under the symbol “JOB.” If you are the record owner of your Shares and
you tender your Shares to us in the tender offer, you will not have to pay
brokerage fees or similar expenses. If you own your Shares through a broker or
other nominee and your broker tenders your Shares 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. See “The Tender
Offer — Section 3 — Procedures for Tendering
Shares.”
What are the most important
conditions to the tender offer?
Our
obligation to purchase Shares at the expiration of the tender offer is subject
to satisfaction of, or if permitted, waiver of, several conditions, including
the condition that PSQ consummates the purchase of the New Issue Shares from GEE
as contemplated in the Agreement, approval of the purchase of the New Issue
Shares by GEE shareholders and satisfaction of all other conditions of the
Offer. We calculate that, based on the number of outstanding Shares of common
stock as of March 31, 2009, there were approximately 5,165,265 outstanding
Shares of common stock at that date and our purchase of the 7,700,000 of New
Issue Shares will result in our beneficial ownership of approximately 58% to
76%, depending on the number of Shares tendered in response to our Offer. These
percentages are based upon the post-issuance number of Shares of GEE common
stock to be outstanding after the issuance of the New Issue Shares and the
completion of the tender offer. There is no minimum number of outstanding Shares
that must be tendered in the tender offer as a condition to the
Offer.
The Offer
is not conditioned upon any antitrust or other governmental approvals, consents
or clearances. The tender offer is subject to several other conditions. See
“Section 12 – Conditions to the Offer.”
The Offer
is scheduled to expire at 12:00 midnight on June 30, 2009; however, unless
the Agreement is terminated pursuant to Section 6.1 thereof, PSQ is
required to extend the Offer from time-to-time until the closing
date (“Closing”) in the event that, at a then-scheduled expiration date,
the conditions to Closing the Offer have not been satisfied ; provided further
that, under no circumstances shall any such extension be less than the minimum
number of days required by the Securities Exchange Act of 1934 or the rules and
regulations promulgated thereunder or by other applicable law. Under the terms
of the Agreement, “Closing” means the simultaneous consummation of the purchase
and sale of the 7,700,000 New Issue Shares by GEE to PSQ and the consummation of
the Offer as described herein.
Do you have the financial resources
to make payment?
Yes. We
have already deposited into escrow pursuant to the Agreement the
total aggregate purchase price of $1,925,000 for the New Issue Shares and we
have available, and are required to establish to GEE, no later than three
business days prior to the closing of the Offer, that we have available the
maximum aggregate tender offer purchase amount of $1,500,000. PSQ also has
sufficient cash resources to pay related fees and expenses of the
Offer. PSQ has the cash on hand to fund the Offer.
Is your financial condition relevant
to my decision to tender my Shares in the Offer?
We do not
think that PSQ’s financial condition is relevant to your decision whether to
tender your Shares in the Offer because (i) PSQ’s obligations in the tender
offer are not subject to any condition relating to financing or the disbursement
of financing and (ii) PSQ’s cash and cash equivalents together provide adequate
financial resources to enable PSQ to make all payments promptly under the tender
offer.
How long do I have to decide whether
to tender in the tender offer?
You will
have until 12:00 midnight, New York City time, on Tuesday, June 30, 2009, or
such later date to which we may extend the expiration date, to decide whether to
tender your Shares in the tender offer. Further, 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. See “The Tender Offer — Section 3 — Procedures for
Tendering Shares.”
Can the Offer be extended and how will I be
notified if the Offer is
extended?
Yes, the
Offer may be extended. Unless the Agreement is terminated pursuant to
Section 6.1 thereof, PSQ is required to extend the Offer from time-to-time until
the Closing in the event that, at a then-scheduled expiration date,
the conditions to Closing the Offer have not been satisfied; provided further
that, under no circumstances shall any such extension be less than the minimum
number of days required by the Securities Exchange Act of 1934 or the rules and
regulations promulgated thereunder or by other applicable
law.
If the
Offer is extended, we will inform Continental Stock Transfer & Trust, the
Depositary for the tender offer, of that fact and will make a public
announcement of the extension, no later than 9:00 a.m., New York City time,
on the next business day after the earlier of the day the Offer is to be
extended or the date the tender offer was scheduled to
expire.
How do I tender my
Shares?
To tender
your Shares, you must deliver the certificates evidencing your Shares, together
with a completed Letter of Transmittal and any required signature guarantees, to
Continental Stock Transfer & Trust Co., the Depositary for the tender offer,
not later than the time the tender offer expires. If your Shares are held in
street name (that is, through a broker, dealer or other nominee), the Shares can
be tendered by your nominee through The Depository Trust Company (“DTC”).
If you are not able to deliver any required items to the Depositary by the
expiration of the tender offer, you may be able to have a broker, bank or other
fiduciary who is a member of the Securities Transfer Agent Medallion Program or
other eligible institution guarantee that the missing items will be received by
the Depositary within three trading days. However, the Depositary must receive
the missing items within that three-trading-day period after the expiration of
the tender offer or you will not be able to tender your Shares in the tender
offer. See “The Tender Offer — Section 3 — Procedures For
Tendering Shares.”
Until what time can I withdraw
previously tendered Shares?
You can
withdraw previously tendered Shares at any time until the tender offer has
expired.
How do I withdraw tendered
Shares?
To
withdraw tendered Shares, you must deliver a written notice of withdrawal, which
includes all required information, to Continental Stock Transfer & Trust
Co., the Depositary for the tender offer, while you have the right to withdraw
the Shares. If you tendered your Shares by giving instructions to a broker,
dealer, commercial bank, trust company or other nominee, you must instruct the
broker, dealer, commercial bank, trust company or other nominee to arrange for
the withdrawal of your Shares. See “The Tender Offer — Section 4
— Withdrawal Rights.”
Have you held discussions with
GEE in the last two years regarding any
transaction?
Shortly
after we initiated discussions with GEE’s Board of Directors in January
2009, we continued those discussions; exchanges of information; conducted due
diligence; negotiated on terms and conditions with the GEE Board of Directors
and then, on March 30, 2009, we signed the Agreement relating to
the tender offer that is the subject of this Offer. Prior to our
initial discussions with the chief executive officer of GEE in January 2009, PSQ
had no contact or discussions or communications regarding this tender offer or
any other similar corporate transaction with GEE. See “Special Factors —
Background of this Offer.”
What does GEE’s Board of Directors think of the Offer?
We
obtained the prior approval and recommendation of GEE’s Board of Directors
before the public announcement of this Offer. We anticipate that GEE will
be filing a Schedule 14D-9 with the Securities and Exchange Commission within a
reasonable time to disclose that the GEE Board of Directors recommends that
shareholders tender their Shares in the Offer.
What are the U.S. federal income tax
consequences of participating in the Offer?
In
general, your sale of Shares pursuant to the tender offer will be a taxable
transaction for U.S. federal income tax purposes and may also be a taxable
transaction under applicable state, local or foreign income or other tax laws.
You should consult your tax advisor about the tax consequences to you of
participating in the tender offer in light of your particular circumstances. See
“The Tender Offer — Section 5 — Certain U.S. Federal Income
Tax Considerations.”
Following the tender offer, will
GEE continue as a publicly reporting
company?
Yes, we
currently expect that GEE will continue as a publicly reporting company as we
review our options, except in the event the Shares no longer meet the standards
for continued listing on the current NYSE AMEX Stock Exchange. In the
event that GEE common stock no longer meets the listing standards, we anticipate
at this point to maintain GEE as a fully-reporting company quoting its common
stock on the Over-the-Counter Electronic Bulletin Board interdealer quotation
market.
Will I have the right to have my
Shares appraised?
If you
tender your Shares in the tender offer, you will not be entitled to exercise any
appraisal rights.
If I decide not to tender, how will
the Offer affect my
Shares?
The
purchase of Shares pursuant to the Offer will reduce the number of Shares that
might otherwise trade publicly and may reduce the number of holders of Shares,
which could affect the liquidity and market value of the remaining Shares held
by the public. We cannot predict whether this would have an adverse or
beneficial effect on the market price for, or marketability of, the Shares or
whether it would cause future market prices to be greater or less than the price
paid in the tender offer. Depending upon the number of Shares purchased pursuant
to the tender offer, GEE’s common stock may no longer meet the standards for
continued listing on the NYSE AMEX Stock
Exchange. Depending on similar factors, GEE may cease being required
to comply with the public reporting requirements under the Exchange Act and may
terminate the same in that event.
When and how will I be paid for my
tendered Shares?
Subject
to the terms and conditions of the tender offer, we will pay for all Shares
validly tendered and not withdrawn promptly after the expiration of the tender
offer. See “The Tender Offer — Section 2 — Acceptance for Payment
and Payment for Shares.”
We will
pay for your Shares by depositing the purchase price with Continental Stock
Transfer & Trust Co., the Depositary for the tender offer, which will act as
your agent for the purpose of receiving payments from us and transmitting such
payments to you. In all cases, payment for tendered Shares will be made only
after timely receipt by the Depositary of such Shares, a properly completed and
duly executed Letter of Transmittal and any other required documents. See “The
Tender Offer — Section 2 — Acceptance for Payment and Payment for
Shares.”
How will my employee stock options be
treated in the Offer?
You are
free to exercise any vested stock options you hold in accordance with their
terms and then tender the Shares you acquired through the option exercise under
this Offer. You should consider whether the exercise price of your outstanding
options is greater than the Offer price or less than the Offer price. If we
consummate the Offer, all unvested employee stock options outstanding at that
time will automatically become vested options as a result of the consummation of
the Offer and our purchase of the New Issue Shares from GEE, and as to those
automatically vested options, you will be free to exercise those in like manner
as your currently vested options.
Can restricted stock of GEE be
tendered in the Offer?
If you
previously received from GEE any restricted stock that now qualifies for resale
in accordance with Rule 144 promulgated under the Securities Act of 1933, you
may tender those Shares in the Offer so long as you satisfy all of the resale
conditions of Rule 144 and deliver to the Depositary all certificates and
related resale documents necessary to process the transfer and sale of your
restricted shares.
What is the market value of my Shares
as of a recent date?
On
March 27, 2009, the last trading day before we signed the Agreement, the
last sale price of the Shares reported on the NYSE AMEX Stock Exchange was $.33
per Share. As of that date, our Offer price represented a premium of
approximately 81.8% and 55.5% over the closing price and over
the 10-day volume-weighted average trading price for the 10 trading days prior
to the last trading day before the announcement of the Offer, respectively, of
GEE’s common stock on the NYSE AMEX Stock Exchange. As of April 15, 2009,
the closing sale price of GEE’s common stock was $.48 per Share. We advise you
to obtain a recent price quotation for the Shares in deciding whether to tender
your Shares. See “The Tender Offer — Section 6 — Price Range of
Shares; Dividends.”
Who can I call if I have questions
about the Offer?
You can
contact the Information Agent, Morrow & Co., LLC by telephone at (203)
658-9400 or by mail to 470 West Avenue, Stamford, CT 06902.
PSQ, LLC, a Kentucky limited
liability company (“PSQ”), is offering to purchase 2,500,000 of the outstanding
shares of common stock, no par value (the “Shares”), of General Employment
Enterprises, Inc. (“GEE” or the “Company”) for $0.60 per share, net to the
seller in cash, without interest, upon the terms and subject to the conditions
set forth in the Securities Purchase and Tender Offer Agreement (the
“Agreement”) and in the related Letter of Transmittal (which
together, as they may be amended from time to time, constitute the “Offer”). The
purpose of the Offer is to acquire up to a maximum of 2,500,000 of the issued
and outstanding Shares. GEE has one class of common
stock and no other outstanding voting securities and, as of March 31,
2009, there was 5,165,265 Shares outstanding.
Stockholders
who will be accepting the Offer should contact and submit their request(s) to
Continental Stock Transfer & Trust, the “Depositary”, and follow the
instructions included in Section 3 of this Offer on or before expiration, which
is Tuesday, June 30, 2009. Shareholders who have Shares registered in
their own names and tender directly to the Depositary will not have
to pay brokerage fees or commissions. On the other hand, stockholders with
Shares held in street name by a broker, dealer, commercial bank, trust company
or other nominee should consult with their nominee to determine if there are any
applicable charges or transaction fees.
Pursuant
to, and subject to the terms of, the Agreement, GEE’s Board of
Directors agreed to recommend that GEE’s shareholders tender their Shares
in the Offer. We anticipate that GEE will be filing a Schedule 14D-9 with
the Securities and Exchange Commission within a reasonable time to disclose that
the GEE Board of Directors recommend that GEE shareholders tender
their Shares in the Offer.
This Offer is subject to the conditions described in
“The Tender
Offer — Section 12 — Conditions to the Offer.” Each of the conditions to the Offer
may, to the extent permitted by the Agreement, or by applicable law, be amended or waived
by us in our sole discretion. There is no financing condition to
this Offer.
This
Offer includes forward-looking statements. These forward-looking
statements include, among others, statements concerning our plans with respect
to the acquisition of the Shares and GEE, our outlook for the future and
information about our strategic plans and objectives for GEE, other statements
of expectations, beliefs, future plans and strategies, anticipated events or
trends and similar projections, as well as any facts or assumptions underlying
these statements or projections. These forward-looking statements are subject to
risks and uncertainties that could cause actual results to differ materially
from those in the forward-looking statements. Except as required by applicable
law, we undertake no obligation to update any forward-looking statements or to
release publicly the results of any revisions to forward-looking statements to
reflect events or circumstances after the date of this Offer or to
reflect the occurrence of unanticipated events.
Except as
otherwise set forth herein, the information concerning GEE contained in this
Offer has been obtained from GEE or has been taken from or based upon publicly
available documents and records on file with the Securities and Exchange
Commission and other public sources. PSQ assumes no responsibility for the
accuracy or completeness of the information contained in such GEE documents and
records or for any failure by GEE to disclose events which may have occurred or
may affect the significance or accuracy of any such information but which is
unknown to us.
This
Offer does not constitute a solicitation of a proxy, consent or authorization
for or with respect to any meeting of, or action by written consent by GEE’s
stockholders.
Stockholders are urged to read this
Offer and the related Letter of Transmittal carefully before deciding
whether to tender their Shares.
Our name
is PSQ, LLC. We are a Kentucky limited liability company formed specifically to
acquire shares of GEE common stock, including 7,700,000 shares of New Issue
Shares of GEE common stock (“New Issue Shares”), which will result in PSQ
controlling the voting class of outstanding capital stock of GEE. We are
offering to purchase up to, but no more than, 2,500,000 shares of the
outstanding shares GEE common stock at a price of $.60 per share. As
of the date hereof, we do not own any shares of GEE common stock, but we have
entered into a Securities Purchase and Tender Offer Agreement (the “Agreement”)
with GEE dated March 30, 2009 which provides that we will purchase from GEE
7,700,000 shares of GEE common stock representing approximately 58% of the
post-issuance number of outstanding shares of common stock of GEE,
for a price of $.25 per Share, for an aggregate purchase price of
$1,925,000. Based on the review of GEE’s business and market position, we
have identified GEE as a strategic opportunity and a foundation for long-term
growth in the providing of professional staffing and related human resource
outsourcing services.
The
following represent the course of events for PSQ that led towards the
Offer:
· A meeting
was then held on February 4, 2009 between representatives of River Falls,
including Stephen Pence and Ronald E. Heineman, GEE, and certain investment /
business partners of River Falls, including Oppenheimer, Sands Brothers Asset
Management and the Park Avenue Bank.
· On
February 5, 2009, PSQ, a special purpose vehicle formed by Stephen Pence,
submitted a draft letter of intent to GEE, outlining a proposed share purchase
and tender offer to be undertaken by PSQ.
· On
February 11, 2009, PSQ and GEE executed the non-binding letter of intent
outlining certain preliminary terms of the Agreement, including proposed terms
of the Offer.
· On
February 17, 2009, Mr. Heineman met with Mr. Imhoff, Jr. in GEE’s corporate
office. They discussed business operations and Mr. Imhoff, Jr.’s role with the
Company if the proposed transactions were to take place.
· A first
draft of the Agreement from PSQ was submitted on March 2, 2009.
· Between
March 8 and March 12, 2009, PSQ and GEE, as well as respective legal counsel
exchanged comments to drafts of the Agreement and negotiated various
terms and conditions of the Agreement and the transactions
contemplated thereby.
· On March
12, 2009, Messrs. Imhoff, Jr., Yauch, Baker and Heineman, present in person at
GEE’s headquarters, along with the GEE’slegal counsel and PSQ’s legal counsel
participating via teleconference, continued to negotiate various open issues in
the terms of the Agreement.
· On March
14, 2009, Mr. Baker discussed certain terms of a proposed Consulting Agreement
for Mr. Imhoff, Jr. (“Consulting Agreement”) with Mr. Heineman.
· On March
19, 2009, PSQ’s legal counsel distributed a revised draft of
the Agreement to GEE. In turn, GEE’s legal counsel delivered a
further revised draft of the Agreement to PSQ on March 20,
2009.
·
· On March
28 and 29, 2009, GEE and PSQ continued to negotiate the remaining issues in
the Agreement and the related ancillary documents that form a part of
the Agreement.
· On March
30, 2009, GEE and PSQ resolved the remaining issues in the various transaction
documents and entered into the Agreement. Contemporaneous with approving the
Agreement, GEE and PSQ also entered into an Escrow Agreement with Park Avenue
Bank, New York, New York, which has agreed to act as the escrow agent for the
transaction, the Consulting Agreement between GEE, PSQ and Mr. Imhoff, Jr., and
a Registration Rights Agreement which provides to PSQ demand
registration rights covering the Shares of common stock to be purchased by PSQ
under the terms of the Agreement as well as piggyback registration rights
for Shares of common stock that will be issued to Mr. Imhoff, Jr.
under the terms of his Consulting Agreement. Thereafter, PSQ caused
the agreed upon purchase price for the 7,700,000 New Issue Shares, $1,925,000,
to be transferred to Park Avenue Bank as the agreed upon escrow agent and GEE
issued a press release shortly thereafter and filed a Form 8-K Current Report
with the Securities and Exchange Commission announcing the execution of the
Agreement and other related transaction documents.
Purpose and Structure of the Offer;
Our Reasons for the Offer; and Plans for GEE After the
Offer
PSQ
was formed as a special purpose vehicle to acquire a controlling interest
in GEE and thereafter, through GEE as our operating subsidiary, to become a
recognized leader in the providing of professional staffing and related human
resource outsourcing services; with specialization on information technology,
engineering, and accounting professionals. Based on our review of the
Company’s business and market position, we have identified the Company as a
strategic opportunity and a foundation for long-term growth.
We are offering to commence a cash
tender offer for a maximum of 2,500,000 of the outstanding Shares of the common
stock of GEE at a purchase price of $0.60 per share, net to the holder in cash,
without interest thereon, for a maximum aggregate amount equal to $1,500,000,
upon the terms and subject to the conditions set forth in the
Agreement.
Holders
of Shares do not have appraisal rights in connection with the
Offer.
Security Ownership of Certain
Beneficial Owners
As of the
date hereof, we do not own any shares of GEE common stock, but we have entered
into the Agreement with GEE dated as of March 30, 2009 which
provides, in part, that we will purchase from GEE 7,700,000 shares of GEE common
stock representing approximately 58% of the post-issuance number of outstanding
shares of common stock of GEE, for a price of $.25 per Share, for an aggregate
purchase price of $1,925,000. Our purchase of the New Issue Shares is
conditional upon the terms and conditions set forth in the Agreement,
commencement of this Offer, approval by GEE’s shareholders of the issuance and
purchase by PSQ of the New Issue Shares and satisfaction of all other conditions
of the Offer.
Proposed
Board of Directors and New Management After Closing
Pursuant
to the Agreement and as requested by PSQ, Sheldon Brottman, Edward O. Hunter,
Thomas G. Kosnik and Kent M. Yauch (the “Resigning Directors”), each of whom is
currently a member of the Board of Directors of GEE, will be resigning from the
Board of Directors upon the occurrence of the closing of the purchase of the New
Issue Shares and the Offer. Each of the Resigning Directors submitted
a letter of resignation to the Company, to be effective only upon and
immediately following the closing of the transactions set forth in the
Agreement.
Also
pursuant to the Agreement and as requested by PSQ, upon the occurrence of the
Closing, Stephen Pence, Charles (Chuck) W.B. Wardell III and Jerry Lancaster
(“Replacement Directors”) will be appointed by the Board of Directors of GEE to
fill the vacancies on the Board of Directors that will result from the
resignations of the Resigning Directors. After their appointments are effected,
the size of the Board of Directors will be reduced to five
members,
and will consist of two current members of the Board of Directors and the three
directors appointed at the request of PSQ.
The Board
of Directors will determine which committees Messrs. Pence, Wardell and
Lancaster will serve on at their first scheduled meeting after the Closing
occurs. If the Closing occurs and Messrs. Pence, Wardell and
Lancaster become members of the Board of Directors, they will receive
compensation as directors in line with the Company’s current non-employee
director compensation arrangement, which will entitle each of them to a monthly
retainer fee of $2,000.
Mr.
Imhoff, Jr., who currently serves as the Chairman of the Board of Directors and
Chief Executive Officer and President of the Company, has agreed to resign from
those positions with the Company at the Closing of the transactions provided for
in the Agreement, although he will remain as a member of the Board of Directors
and a consultant to the Company under the terms of his Consulting Agreement.
Under the terms of the Agreement, the Board of Directors has agreed to appoint
Mr. Pence to serve as Chairman of the Board of Directors effective upon Mr.
Imhoff, Jr.’s resignation.
The
following biographical information sets forth, with respect to each individual
nominee for appointment as a director, the name, age of the individual as of
April 15, 2009, current principal occupation and employment history during the
past five years. Each designee has agreed to serve, if elected.
Stephen B. Pence, 55, is
currently a retired colonel from the United States Army Reserve, where he served
as a federal military judge, and is also of counsel with Martin, Ogburn &
Zipperle, in Louisville, Kentucky, assisting clients involved in human resource
staffing and workers’ compensation insurance. In 2001, Mr. Pence was
nominated by President Bush and confirmed by the U.S. Senate to the position of
United States Attorney for the Western District of Kentucky. From
2003 to 2007, Mr. Pence served as Lieutenant Governor of Kentucky, which
included roles as the Secretary of the Justice and Public Safety Cabinet and
Commissioner of State Police. Mr. Pence received his bachelor’s
degree in business and his masters of business administration, with a
concentration on economics, from Eastern Kentucky University, and his Juris
Doctorate degree from the University of Kentucky.
Charles W.B. Wardell III, 56,
served as Senior Advisor to the Chief Executive Officer of Korn/Ferry
International, a multi-national executive recruitment service with currently
more than 90 offices in 40 countries, from 1992 through 2007. Between
1990 and 1992, Mr. Wardell operated as President of Nordeman Grimm, a New York
based boutique executive placement firm with specialization on placement with
marketing and financial services companies. In 1978, he joined
American Express as Special Assistant to the Chief Executive Officer, although
he also held roles, between 1978 and 1990, of Regional Vice President and
General Manager of American Express Company Middle East and Senior Vice
President and Chief Operating Officer of Global Private Banking at American
Express International Banking Corporation. His experience also encompasses
Senior Vice President, both at Travelers and Mastercard International, as well
as Executive Vice President of Diners Club at Citicorp. Mr. Wardell
graduated cum laude from Harvard College with an A.B. degree.
Jerry Lancaster, 74, has been
employed with Imperial Casualty and Indemnity Company since 1997, where he is
currently the Chairman and the Director of Marketing. He has worked
in a variety of capacities involving workers’ compensation programs and holds
General Lines Agent and Managing General Agent licenses from the State of
Texas. Mr. Lancaster graduated from Southern Methodist University
with a degree in mathematics.
In
connection with Mr. Imhoff, Jr.’s agreement to resign as Chief Executive Officer
and President of the Company if the Closing occurs, and in accordance with the
Agreement, PSQ has requested, and the Board of Directors of the
Company has approved, the appointment of Ronald E. Heineman to serve as Chief
Executive Officer and President of the Company effective upon Mr. Imhoff, Jr.’s
resignation.
Mr.
Heineman has agreed to an initial annual salary of $1 and a grant of 150,000
stock options on the date of the Closing pursuant to and in accordance with the
Company’s Amended and Restated 1997 Stock Option Plan (the “1997 Option Plan”),
with such options to be fully vested on the date of issuance. The
grant of such options was made subject to the approval of the Company’s
shareholders of an increase in the number of authorized shares of Common Stock
available for issuance under the 1997 Plan to accommodate such stock option
issuance, which
shareholder
approval will be sought at the Company’s 2010 Annual Meeting of Shareholders or
at such earlier special meeting of shareholders as may be called in accordance
with the Company’s By-laws, provided that such meeting will not be called for
prior to the date of the consummation of the Agreement.
Employee Stock Options and Restricted
Stock
You are
free to exercise any vested stock options you hold in accordance with their
terms and then tender the Shares you acquired through the option exercise under
this Offer. You should consider whether the exercise price of your outstanding
options is greater than the Offer price or less than the Offer price. If we
consummate the Offer, all unvested employee stock options outstanding at that
time will automatically become vested options as a result of the consummation of
the Offer and our purchase of the New Issue Shares from GEE, and as to those
automatically vested options, you will be free to exercise those in like manner
as your currently vested options. If you previously received from GEE any
restricted stock that now qualifies for resale in accordance with Rule 144
promulgated under the Securities Act of 1933, you may tender those Shares in the
Offer so long as you satisfy all of the resale conditions of Rule 144 and
deliver to the Depositary all certificates and related resale documents
necessary to process the transfer and sale of your restricted
shares.
Section 1 — Terms of the
Offer; Expiration Date
Upon the
terms and subject to the conditions of the Offer (including, if the Offer is
extended or amended, the terms and conditions of such extension or amendment),
we will accept for payment and pay for all Shares validly tendered and not
withdrawn by the Expiration Date in accordance with the procedures set forth in
“— Section 4 — Withdrawal Rights.” The term “Expiration Date”
means 12:00 midnight, New York City time, on Tuesday, June 30, 2009, unless we
have extended the period during which the Offer is open, in which event the term
“Expiration Date” shall mean the latest time and date at which the Offer, as so
extended by us, shall expire.
We
may waive any or all of the conditions to our obligation to purchase Shares
pursuant to the Offer. If by the initial Expiration Date or any subsequent
Expiration Date, any or all of the conditions to the Offer have not been
satisfied or waived, the Agreement provides that, unless the Agreement shall
have been terminated pursuant to Section 6.1 thereof, we shall be required to
extend the Offer from time-to-time until the Closing in the event that, at a
then-scheduled Expiration Date, the conditions to Closing set forth in the
Agreement have not been satisfied; provided further that, under no circumstances
shall any such extension be less than the minimum number of days required by the
Securities Exchange Act of 1934 or the rules and regulations promulgated there
under or by applicable law. See “— Section 12 — Conditions to the
Offer.”
We
acknowledge that (i) the Securities Exchange Act of 1934 requires us to pay
the consideration offered or return the Shares tendered promptly after the
termination or withdrawal of the Offer and (ii) we may not delay acceptance
for payment of, or payment for, any Shares upon the occurrence of any of the
events specified in “— Section 12 — Conditions to the Offer”
without extending the period of time during which the Offer is
open.
Under the
terms of the Agreement, we are required to extend the Offer beyond the
Expiration Date for any of the following reasons: (i) from time to time if,
at the Expiration Date, any of the conditions to the Offer and Agreement have
not been satisfied or waived; or (ii) for any period required by any rule,
regulation, interpretation or position of the Securities and Exchange Commission
or any period required by or advisable under applicable law or under the
provisions of the Agreement.
We will
accept for payment and pay for all Shares validly tendered and not withdrawn
pursuant to the Offer if all the conditions to the Offer are satisfied or waived
on the Expiration Date. Any such extension, delay, termination, waiver or
amendment will be followed as promptly as practicable by public announcement
thereof, such announcement in the case of an extension to be made no later than
9:00 a.m., New York City time, on the next business day after the earlier
of the day we decide to extend or the previously scheduled Expiration Date.
Subject to applicable law and without limiting the manner in which we may choose
to make any public announcement, we shall have no obligation to publish,
advertise or otherwise communicate any such public announcement other than by
issuing a press release.
If we are delayed in making
payment for the Shares or are unable to pay for Shares pursuant to the Offer for
any reason, then, without prejudice to our rights under the Offer, the
Depositary may retain tendered Shares on our behalf, and such Shares may not be
withdrawn except to the extent tendering shareholders are entitled to withdrawal
rights as described in “— Section 4 — Withdrawal Rights.”
However, our ability to delay the payment for Shares which we have accepted for
payment is limited by Rule 14e-1 under the Securities Exchange Act of 1934,
which requires that a bidder pay the consideration offered or return the
securities deposited by, or on behalf of, holders of securities promptly after
the termination or withdrawal of the Offer.
If we
make a material change in the terms of the Offer or the information concerning
the Offer, or if we waive a material condition of the Offer, we will extend the
Offer to the extent required by Rule 14e-1 under the Securities Exchange
Act of 1934. The minimum period during which the Offer must remain open
following material changes in the terms of the Offer or information concerning
the Offer, other than a change in price or change in percentage of Shares to be
purchased in the Offer, will depend upon the facts and circumstances then
existing, including the relative materiality of the changed terms or
information. In a public release, the Securities and Exchange Commission has
stated its view that an offer must remain open for a minimum period of time
following a material change in the terms of the Offer and that waiver of a
material condition is a material change in the terms of the Offer. The release
states that, as a general rule, an offer should remain open for a minimum of
five business days from the date a material change is first published or sent or
given to security holders and that, if material changes are made with respect to
information not materially less significant than the Offer price and the number
of Shares being sought, a minimum of 10 business days may be required to allow
for adequate dissemination to stockholders. For purposes of the Offer, a
“business day” means any day other than a Saturday, Sunday or federal holiday
and consists of the time period from 12:01 a.m. through 12:00 midnight, New
York City time. The requirement to extend the Offer will not apply to the extent
that the number of business days remaining between the occurrence of the change
and the then-scheduled Expiration Date equals or exceeds the minimum extension
period that would be required because of such amendment. If, prior to the
Expiration Date, we increase the consideration offered to holders of Shares
pursuant to the Offer, such increased consideration will be paid to all holders
whose Shares are purchased in the Offer whether or not such Shares were tendered
prior to such increase.
We have
access to GEE’s shareholders’ list and securities position listings for the
purpose of disseminating the Offer to holders of the Shares. This Offer and the
related Letter of Transmittal will be mailed to record holders of all GEE Shares
whose names appear on GEE’s shareholder list and will be furnished, for
subsequent transmittal to beneficial owners of GEE Shares, to brokers, dealers,
commercial banks, trust companies and similar persons whose names, or the names
of whose nominees, appear on the stockholder list or, if applicable, who are
listed as participants in a clearing agency’s security position
listing.
Section 2 — Acceptance for
Payment and Payment for Shares
Upon the
terms and subject to the conditions of the Offer (including, if the Offer is
extended or amended, the terms and conditions of any such extension or
amendment), we will accept for payment, and will pay for, all Shares validly
tendered prior to the Expiration Date and not properly withdrawn, as soon as
practicable after the Expiration Date. If we desire to delay payment for Shares
accepted for payment pursuant to the Offer, and such delay would otherwise be in
contravention of Rule 14e-1 of the Exchange Act, we will otherwise extend
the Offer. In all cases, payment for Shares tendered and accepted for payment
pursuant to the Offer will be made only after timely receipt by the Depositary
of (i) the certificates evidencing such Shares (the “Certificates”) or
timely confirmation of a book-entry transfer of such Shares into the
Depositary’s account at DTC (a “Book-Entry Confirmation”) pursuant to the
procedures set forth in “— Section 3 — Procedures For Tendering
Shares,” (ii) the Letter of Transmittal (or a facsimile thereof), properly
completed and duly executed, with any required signature guarantees or, in the
case of a book-entry transfer, an Agent’s Message (as defined below) in lieu of
the Letter of Transmittal and (iii) any other documents required by the
Letter of Transmittal.
For
purposes of the Offer, we will be deemed to have accepted for payment, and
thereby purchased, Shares validly tendered and not properly withdrawn as, if and
when we give oral or written notice to the Depositary, as agent for the
tendering stockholders, of our acceptance for payment of such Shares pursuant to
the Offer. Upon the terms and subject to the conditions of the Offer, payment
for Shares accepted for payment pursuant to the Offer will be made by deposit of
the purchase price therefore with the Depositary, which will act as agent for
tendering
stockholders
for the purpose of receiving payments from us and transmitting such payments to
tendering stockholders whose Shares have been accepted for payment. Under no
circumstances will interest on the Offer price for Shares be paid, regardless of
any delay in making such payment.
If any
tendered Shares are not accepted for payment for any reason pursuant to the
terms and conditions of the Offer, or if Certificates are submitted evidencing
more Shares than are tendered, Certificates evidencing un-purchased Shares will
be returned, without expense to the tendering stockholder (or, in the case of
Shares tendered by book-entry transfer into the Depositary’s account at DTC
pursuant to the procedure set forth in “— Section 3 — Procedures
For Tendering Shares,” such Shares will be credited to an account maintained at
DTC), as promptly as practicable following the expiration or termination of the
Offer.
If, on or
prior to the Expiration Date, we shall increase the consideration offered to any
holders of Shares pursuant to the Offer, such increased consideration shall be
paid to all holders of Shares that are purchased pursuant to the Offer, whether
or not such Shares were tendered, accepted for payment or paid for prior to such
increase in consideration.
Subject
to GEE’s approval, we reserve the right to transfer or assign, in whole or, from
time to time, in part, to one or more of our affiliates, the right to purchase
all or any portion of the Shares tendered pursuant to the Offer, but any such
transfer or assignment will not relieve us of our obligations under the Offer
and will in no way prejudice the rights of tendering stockholders to receive
payment for Shares validly tendered and accepted for payment pursuant to the
Offer.
Section 3 — Procedures for
Tendering Shares
Except as
set forth below, in order for Shares to be validly tendered pursuant to the
Offer, the Letter of Transmittal (or a facsimile thereof), properly completed
and duly executed, together with any required signature guarantees (or, in the
case of a book-entry transfer, an Agent’s Message (as defined below) in lieu of
the Letter of Transmittal) and any other documents required by the Letter of
Transmittal, must be received by the Depositary at its address set forth on the
back cover of this Offer and either (i) the Certificates evidencing
tendered Shares must be received by the Depositary at such address or such
Shares must be tendered pursuant to the procedure for book-entry transfer
described below and a Book-Entry Confirmation must be received by the Depositary
(including an Agent’s Message if the tendering stockholder has not delivered a
Letter of Transmittal), in each case on or prior to the Expiration Date or
(ii) the tendering stockholder must comply with the guaranteed delivery
procedures described below. No alternative, conditional or contingent tenders
will be accepted. The term “Agent’s Message” means a message, transmitted by
electronic means to, and received by, the Depositary and forming a part of a
Book-Entry Confirmation which states that DTC has received an express
acknowledgment from the participant in DTC tendering the Shares which are the
subject of such Book-Entry Confirmation, that such participant has received and
agrees to be bound by the terms of the Letter of Transmittal and that we may
enforce such agreement against such participant.
The
Depositary will establish accounts with respect to the Shares at DTC for
purposes of the Offer within two business days after the date of this Offer. Any
financial institution that is a participant in DTC’s system may make a
book-entry delivery of Shares by causing DTC to transfer such Shares into the
Depositary’s account in accordance with DTC’s procedures for such transfer.
However, although delivery of Shares may be made through book-entry transfer at
DTC, either the Letter of Transmittal (or a facsimile thereof), properly
completed and duly executed, together with any required signature guarantees, or
an Agent’s Message in lieu of the Letter of Transmittal, and any other required
documents, must, in any case, be received by the Depositary at its address set
forth on the back cover of this Offer prior to the Expiration Date, or the
tendering stockholder must comply with the guaranteed delivery procedures
described below. Delivery of
documents to DTC does not constitute delivery to the
Depositary.
Signatures
on all Letters of Transmittal must be guaranteed by a firm which is a member of
the Security Transfer Agents Medallion Program, the NYSE Medallion Guarantee
Program, the Stock Exchange Medallion
Program
or any other “eligible guarantor institution” (as such term is defined in
Rule 17Ad-15 under the Exchange Act) (each, an “Eligible Institution”),
except in cases where Shares are tendered (i) by a registered holder of
Shares who has not completed either the box entitled “Special Payment
Instructions” or the box entitled “Special Delivery Instructions” on the Letter
of Transmittal or (ii) for the account of an Eligible Institution. If a
Certificate is registered in the name of a person other than the signatory of
the Letter of Transmittal (or a facsimile thereof), or if payment is to be made,
or a Certificate not accepted for payment or not tendered is to be returned, to
a person other than the registered holder(s), then the Certificate must be
endorsed or accompanied by appropriate stock powers, in either case signed
exactly as the name(s) of the registered holder(s) appear on the Certificate,
with the signature(s) on such Certificate or stock powers guaranteed by an
Eligible Institution. If the Letter of Transmittal or stock powers are signed or
any Certificate is endorsed by trustees, executors, administrators, guardians,
attorneys-in-fact, officers of corporations or others acting in a fiduciary or
representative capacity, such persons should so indicate when signing and,
unless waived by us, proper evidence satisfactory to us of their authority to so
act must be submitted. See Instructions 1 and 5 of the Letter of
Transmittal.
Guaranteed
Delivery
If a
stockholder desires to tender Shares pursuant to the Offer and the Certificates
evidencing such stockholder’s Shares are not immediately available or such
stockholder cannot deliver the Certificates and all other required documents to
the Depositary prior to the Expiration Date, or such stockholder cannot complete
the procedure for delivery by book-entry transfer on a timely basis, such Shares
may nevertheless be tendered, provided that all the following conditions are
satisfied:
(i) such
tender is made by or through an Eligible Institution;
(ii) a
properly completed and duly executed Notice of Guaranteed Delivery,
substantially in the form we provide, is received prior to the Expiration Date
by the Depositary as provided below; and
(iii) the
Certificates (or a Book-Entry Confirmation) evidencing all tendered Shares, in
proper form for transfer, in each case together with the Letter of Transmittal
(or a facsimile thereof), properly completed and duly executed, with any
required signature guarantees (or, in connection with a book-entry transfer, an
Agent’s Message), and any other documents required by the Letter of Transmittal
are received by the Depositary within three NYSE trading days after the date of
execution of such Notice of Guaranteed Delivery. A “trading day” is any day on
which the NYSE AMEX Stock Exchange is open for business.
The
Notice of Guaranteed Delivery may be delivered by hand or mail or transmitted by
telegram or facsimile transmission to the Depositary and must include a
guarantee by an Eligible Institution in the form set forth in the form of Notice
of Guaranteed Delivery made available by us.
In all
cases, payment for Shares tendered and accepted for payment pursuant to the
Offer will be made only after timely receipt by the Depositary of the Share
Certificates evidencing such Shares, or a Book-Entry Confirmation of the
delivery of such Shares, and the Letter of Transmittal (or a facsimile thereof),
properly completed and duly executed, with any required signature guarantees,
and any other documents required by the Letter of Transmittal, or an Agent’s
Message in the case of a book-entry transfer.
The method of delivery of
Certificates and all other required documents, including delivery through DTC,
is at the option and risk of the tendering stockholder, and the delivery will be
deemed made only when complete delivery is actually received by the Depositary.
If delivery is by mail, registered mail with return receipt requested, properly
insured, is recommended. In all cases, sufficient time should be allowed to
ensure timely delivery.
Determination of
Validity
All
questions as to the validity, form, eligibility (including time of receipt) and
acceptance for payment of any tender of Shares will be determined by us in our
sole discretion, which determination shall be final and binding on all parties.
We reserve the absolute right to reject any and all tenders determined by us not
to be in proper form or the acceptance for payment of which may, in the opinion
of our counsel, be unlawful. We also reserve the absolute
right to
waive any condition of the Offer (other than the majority of the minority
condition) or any defect or irregularity in the tender of any particular Shares
of any particular stockholder, whether or not similar defects or irregularities
are waived in the case of other stockholders, and our interpretation of the
terms and conditions of the Offer will be final and binding on all persons. No
tender of Shares will be deemed to have been validly made until all defects and
irregularities have been cured or waived to our satisfaction. None of us, GEE,
the Depositary, the Information Agent or any other person will be under any duty
to give notification of any defects or irregularities in tenders, or any waiver
thereof, or incur any liability for failure to give any such notification or for
any such determination.
By
executing the Letter of Transmittal as set forth above, a tendering stockholder
irrevocably appoints our designees as such stockholder’s proxies, each with full
power of substitution, in the manner set forth in the Letter of Transmittal, to
the full extent of such stockholder’s rights with respect to the Shares tendered
by such stockholder and accepted for payment by us (and with respect to any and
all other Shares or other securities issued or issuable in respect of such
Shares on or after the date of this Offer). All such proxies shall be considered
coupled with an interest in the tendered Shares. Such appointment will be
effective when, and only to the extent that, we accept such Shares for payment.
Upon such acceptance for payment, all prior proxies given by such stockholder
with respect to such Shares (and such other Shares and securities) will be
revoked without further action, and no subsequent proxies may be given nor any
subsequent written consent executed by such stockholder (and, if given or
executed, will not be deemed to be effective) with respect thereto. Our
designees will, with respect to the Shares for which the appointment is
effective, be empowered to exercise all voting and other rights of such
stockholder as they in their sole discretion may deem proper at any annual or
special meeting of GEE’s stockholders or any adjournment or postponement
thereof, by written consent in lieu of any such meeting or otherwise. We reserve
the right to require that, in order for Shares to be deemed validly tendered,
immediately upon our payment for such Shares, we must be able to exercise full
voting rights with respect to such Shares.
Our
acceptance for payment of Shares pursuant to any of the procedures described
above will constitute a binding agreement between the tendering stockholder and
us upon the terms and subject to the conditions of the Offer.
Section 4 — Withdrawal
Rights
Tenders
of the Shares made pursuant to the Offer are irrevocable except that such Shares
may be withdrawn at any time prior to the initial Expiration Date and, unless
theretofore accepted for payment by us pursuant to the Offer, may also be
withdrawn at any time after Tuesday, June 30, 2009. If we extend the
Offer, are delayed in our acceptance for payment of Shares or are unable to
accept Shares for payment pursuant to the Offer for any reason, then, without
prejudice to our rights under the Offer, the Depositary may, nevertheless, on
our behalf, retain tendered Shares, and such Shares may not be withdrawn except
to the extent that tendering stockholders are entitled to withdrawal rights as
described in this section. Any such delay will be accompanied by an extension of
the Offer to the extent required by law.
For a
withdrawal to be effective, a written or facsimile transmission notice of
withdrawal must be timely received by the Depositary at its address set forth on
the back cover page of this Offer. Any such notice of withdrawal must specify
the name of the person who tendered the Shares to be withdrawn, the number of
Shares to be withdrawn and the name of the registered holder of such Shares, if
different from that of the person who tendered such Shares. If Certificates
evidencing Shares to be withdrawn have been delivered or otherwise identified to
the Depositary, then, prior to the physical release of such Certificates, the
serial numbers shown on such Certificates must be submitted to the Depositary
and the signature(s) on the notice of withdrawal must be guaranteed by an
Eligible Institution, unless such Shares have been tendered for the account of
an Eligible Institution. If Shares have been tendered pursuant to the procedure
for book-entry transfer as set forth in “— Section 3 — Procedures
For Tendering Shares,” any notice of withdrawal must specify the name and number
of the account at DTC to be credited with the withdrawn Shares and must
otherwise comply with DTC’s procedures.
Withdrawals
of tenders of Shares may not be rescinded, and Shares properly withdrawn will
thereafter be deemed not validly tendered for purposes of the Offer. However,
withdrawn Shares may be retendered by again
following
the procedures described in “— Section 3 — Procedures for
Tendering Shares” at any time prior to the Expiration Date.
All
questions as to the form and validity (including time of receipt) of any notice
of withdrawal will be determined by us, in our sole discretion, and our
determination will be final and binding. None of us, including the
Depositary, the Information Agent or any other person will be under a duty to
give notification of any defects or irregularities in any notice of withdrawal
or incur any liability for failure to give any such
notification.
Section 5 — Certain U.S.
Federal Income Tax Considerations
The
following summarizes certain of the material U.S. federal income tax
consequences of the Offer to holders of the Shares that are U.S. Holders
(as defined below). This summary is based upon the Internal Revenue Code of
1986, as amended (the “Internal Revenue Code”), existing and proposed
regulations promulgated thereunder, published rulings and court decisions, all
as in effect and existing on the date hereof and all of which are subject to
change at any time, which change may be retroactive or prospective. No rulings
have been sought or are expected to be sought from the Internal Revenue Service
(the “IRS”) with respect to any of the tax consequences discussed below, and no
assurance can be given that the IRS will not take contrary positions. Unless
otherwise specifically noted, this summary applies only to those persons that
hold their Shares as a capital asset within the meaning of Section 1221 of
the Internal Revenue Code and does not apply to persons who hold their Shares
pursuant to the exercise of employee stock options or otherwise as
compensation.
This
summary is for general information only and does not address all of the tax
consequences of the Offer that may be relevant to a U.S. Holder (as defined
below) of the Shares. It also does not address any of the tax consequences of
the Offer to holders of the Shares that are Non-U.S. Holders (as defined
below), or to holders that may be subject to special tax treatment, such as
financial institutions, real estate investment trusts, personal holding
companies, tax-exempt organizations, regulated investment companies, insurance
companies, S corporations, brokers and dealers in securities or currencies
and certain U.S. expatriates. Further, this summary does not address: the
U.S. federal income tax consequences of the Offer to stockholders, partners
or beneficiaries of an entity that is a holder of the Shares; the
U.S. federal estate, gift or alternative minimum tax consequences of the
Offer; persons who hold the Shares in a straddle or as part of a hedging,
conversion, constructive sale or other integrated transaction or whose
functional currency is not the U.S. dollar; any state, local or foreign tax
consequences of the Offer; or holders whose status changes from a
U.S. Holder to a Non-U.S. Holder or vice versa; or any person that
owns actually or constructively (giving effect to the ownership attribution
rules of the Internal Revenue Code) shares of common stock of
GEE.
Each holder of the Shares should
consult its own tax advisor regarding the tax consequences of the Offer,
including such holder’s status as a U.S. Holder or a Non-U.S. Holder,
as well as any tax consequences that may arise under the laws of any state,
local, foreign or other non-U.S. taxing jurisdiction and the possible
effects of changes in U.S. federal or other tax
laws.
A
“U.S. Holder” means a beneficial owner of the Shares that, for
U.S. federal income tax purposes, is: (i) a citizen or individual
resident, as defined in Section 7701(b) of the Internal Revenue Code, of
the United States; (ii) a corporation or partnership, including any
entity treated as a corporation or partnership for U.S. federal income tax
purposes, created or organized in the United States or under the laws of the
United States, any State thereof or the District of Columbia (unless, in
the case of a partnership, Treasury regulations provide otherwise);
(iii) an estate, the income of which is subject to U.S. federal income
tax without regard to its source; or (iv) a trust, if (a) a court
within the United States is able to exercise primary supervision over the
administration of the trust and (b) one or more U.S. persons have the
authority to control all substantial decisions of the trust. Notwithstanding the
preceding sentence, certain trusts in existence on August 20, 1996, and
treated as U.S. trusts prior to such date, may elect to be treated as
U.S. Holders. If a partnership holds the Shares, the tax treatment of each
of its partners generally will depend upon the status of such partner and the
activities of the partnership. Partners of partnerships holding the Shares
should consult their own tax advisors regarding the U.S. federal tax
consequences of the Offer.
A
“Non-U.S. Holder” means a beneficial owner of the Shares that is not a
U.S. Holder. We urge holders of the Shares that are Non-U.S. Holders
to consult their own tax advisors regarding the U.S. federal income
tax
consequences
of the Offer, including potential application of U.S. withholding taxes and
possible eligibility for benefits under applicable income tax
treaties.
The sale
of the Shares for cash under the Offer will be a taxable transaction to
U.S. Holders for U.S. federal income tax purposes. In general, a
U.S. Holder who sells the Shares pursuant to the Offer will recognize gain
or loss for U.S. federal income tax purposes in an amount equal to the
difference, if any, between the amount of cash received and the
U.S. Holder’s adjusted tax basis in the Shares sold. Gain or loss will be
determined separately for each block of Shares (that is, Shares acquired at the
same cost in a single transaction) tendered under the Offer.
U.S. Holders
of the Shares that are corporations generally will be taxed on net capital gains
at a maximum rate of 35%. In contrast, U.S. Holders that are individuals
generally will be taxed on net capital gains at a maximum rate of 15% with
respect to those Shares held for more than 12 months at the effective time
of the Offer, and 35% with respect to those Shares held for 12 months or
less. In addition, special rules, and generally lower maximum rates, apply to
individuals in lower tax brackets. Any capital losses realized by a
U.S. Holder that is a corporation generally may be used only to offset
capital gains. Any capital losses realized by a U.S. Holder that is an
individual generally may be used only to offset capital gains plus $3,000 of
ordinary income per year.
Backup
Withholding Tax and Information Reporting
Payment
of proceeds with respect to the sale of the Shares pursuant to the Offer may be
subject to information reporting and U.S. federal backup withholding tax at
the applicable rate if the U.S. Holder or Non-U.S. Holder thereof
fails to supply an accurate taxpayer identification number or otherwise fails to
comply with applicable U.S. information reporting or certification
requirements. These
requirements are set forth in the Letter of Transmittal and should be carefully
reviewed by each holder of the Shares. Backup withholding is not an
additional tax. Any amounts so withheld will be allowed as a refund or a credit
against such U.S. Holder’s or Non-U.S. Holder’s U.S. federal
income tax liability; provided, however, that the required information is timely
furnished to the IRS.
Section 6 — Price Range of
Shares; Dividends
The
Shares are listed and principally traded on the NYSE AMEX Stock Exchange
under the symbol “JOB.” The following table sets forth, for the quarters
indicated, the high and low sales prices per Share on the NYSE AMEX Stock
Exchange as reported by published financial sources.
|
Calendar
Year
|
|
High
|
|
|
Low
|
|
|
2007:
|
|
|
|
|
|
|
|
|
|
Second
Quarter
|
|
2.01
|
|
|
1.96
|
|
|
Third
Quarter
|
|
1.76
|
|
|
1.76
|
|
|
Fourth
Quarter
|
|
1.66
|
|
|
1.63
|
|
|
2008:
|
|
|
|
|
|
|
|
|
|
First
Quarter
|
|
1.38
|
|
|
1.32
|
|
|
Second
Quarter
|
|
.85
|
|
|
.85
|
|
|
Third
Quarter
|
|
.41
|
|
|
.40
|
|
|
Fourth
Quarter
|
|
.42
|
|
|
.39
|
|
|
2009
|
|
|
|
|
|
|
|
|
|
First
Quarter
|
|
.48
|
|
|
.35
|
|
On
March 27, 2009, the last full trading day prior to the public announcement
of the Offer, the last sale price per Share was $0.33 as reported on the NYSE
AMEX Stock Exchange.
Stockholders are urged to obtain a
current market quotation for the Shares.
|
|
|
|
Section 7 —
|
Certain Information Concerning
GEE
|
The
principal executive office of GEE is located at One Tower Lane, Suite 2200,
Oakbrook Terrace, Illinois. GEE operates in one industry segment, providing
professional staffing services. The Company offers its customers both placement
and contract staffing services, specializing in the placement of information
technology, engineering and accounting professionals. The Company’s placement
services include placing candidates into regular, full-time jobs with
client-employers. The Company’s contract services include placing its
professional employees on temporary assignments, under contracts with client
companies. Contract workers are employees of the Company, typically working at
the client location and at the direction of client personnel for periods of
three months to one year. The combination of these two services
provides a strong marketing opportunity, because it offers customers a variety
of staffing alternatives that includes direct hire, temporary staffing and a
contract-to-hire approach to hiring.
GEE is
subject to the informational filing requirements of the Exchange Act and, in
accordance therewith, is required to file periodic reports, proxy statements and
other information with the Commission relating to its business, financial
condition and other matters. Such reports, proxy statements and other
information can be inspected and copied at the public reference facilities
maintained by the Commission at 100 F Street, N.W.,
Washington, D.C. 20549. Information regarding the public reference
facilities may be obtained from the Commission by telephoning 1-800-SEC-0330.
GEE’s filings are also available to the public on the Commission’s Web site
(www.sec.gov). Copies
of such materials may also be obtained by mail from the Public Reference Room of
the Commission at 100 F Street, N.W., Washington, D.C. 20549,
upon payment of the Commission’s customary fees.
Section 8 —
Certain Information Concerning PSQ
PSQ is a
newly-formed Kentucky limited liability company formed specifically to acquire
the shares, including 7,700,000 shares of the New Issue Shares, of GEE common
stock which will result in PSQ controlling the voting class of outstanding
capital stock of GEE. By this Offer, we are also offering to purchase up to, but
no more than, 2,500,000 of the outstanding shares GEE common stock of at a price
of $.60 per share. As of the date hereof, we do not own any shares of GEE common
stock, but we have entered into the Agreement with GEE dated March 30, 2009
which provides that we will purchase from GEE 7,700,000 shares of GEE common
stock representing 60% of the then outstanding shares of common stock of GEE,
for a price of $.25 per Share, for an aggregate purchase price of
$1,925,000. With GEE as our operating subsidiary, we expect to
become a recognized leader in the providing of professional staffing and related
human resource outsourcing services, with specialization on information
technology, engineering, and accounting professionals. Based on the
review of GEE’s business and market position, we have identified GEE as a
strategic opportunity and a foundation for long-term growth.
Section 9 —
Source and Amount of Funds
We will
need approximately $1,750,000 to purchase the maximum number of Shares pursuant
to the Offer and to pay related fees and expenses and an additional $1,925,000
to purchase the New Issue Shares that are the subject of the Agreement. PSQ
intends to deploy its own proprietary cash under management for funding the
purchase of Shares in the Offer and for the purchase of the New Issue Shares,
without the use of third party funding. We are also required in the Agreement to
establish to GEE’s satisfaction that we have available the maximum aggregate
tender offer purchase amount of $1,500,000, no later than three business days
prior to the Closing of the Offer. PSQ has sufficient cash resources to pay
related fees and expenses of the Offer.
Section 10 —
Possible Effects of the Offer on the Market for the Shares
Effect on the
Market for the Shares
The
purchase of Shares by us pursuant to the Offer will reduce the number of Shares
that might otherwise trade publicly and will reduce the number of holders of
Shares, which could adversely affect the liquidity and market value of the
remaining Shares held by the public.
The
Shares are currently listed and traded on the NYSE AMEX Stock
Exchange, which constitutes the principal trading market for the Shares.
Depending upon the number of Shares purchased pursuant to the Offer, the Shares
may no longer meet the standards for continued listing on the NYSE AMEX Stock
Exchange, but PSQ does not anticipate that the consummation of the Offer will
materially impact current listing standards for the common
stock.
The
Shares are currently “margin securities” as such term is defined under the rules
of the Board of Governors of the Federal Reserve System (the “Federal Reserve
Board”), which has the effect, among other things, of allowing brokers to extend
credit on the collateral of such securities. Depending upon factors similar to
those described above regarding listing and market quotations, following the
Offer it is possible that the Shares might no longer constitute “margin
securities” for purposes of the margin regulations of the Federal Reserve Board,
in which event such Shares could no longer be used as collateral for loans made
by brokers.
Section 11 — Fees and
Expenses
Except as
set forth below, we will not pay any fees or commissions to any broker, dealer
or other person for soliciting tenders of Shares pursuant to the
Offer.
PSQ has
retained Morrow & Co., LLC, as the Information Agent, and Continental Stock
Transfer & Trust, as the Depositary, in connection with the Offer. The
Information Agent may contact holders of Shares by mail, telephone, facsimile,
e-mail and personal interview and may request banks, brokers, dealers and other
nominee stockholders to forward materials relating to the Offer to beneficial
owners.
As
compensation for acting as Information Agent in connection with the Offer,
Morrow & Co., LLC will receive reasonable and customary compensation for its
services and will also be reimbursed for certain reasonable out-of-pocket
expenses and will be indemnified against certain liabilities and expenses in
connection with the Offer, including certain liabilities under the federal
securities laws. PSQ will pay the Depositary reasonable and customary
compensation for its services in connection with the Offer, plus reimbursement
for reasonable out-of-pocket expenses, and will indemnify the Depositary against
certain liabilities and expenses in connection therewith, including certain
liabilities under federal securities laws.
Brokers,
dealers, commercial banks and trust companies will be reimbursed by us for
customary handling and mailing expenses incurred by them in forwarding material
to their customers.
The
following is an estimate of fees and expenses to be incurred by us in connection
with the Offer (in thousands):
|
|
|
|
|
|
|
Advertising
|
|
$
|
250.00
|
|
|
Filing
Fees
|
|
$
|
85.00
|
|
|
Depositary
|
|
$
|
10,000
|
|
|
Information
Agent (including mailing)
|
|
$
|
4,800
|
|
|
Legal,
Printing and Miscellaneous
|
|
$
|
75,000
|
|
|
|
|
|
|
|
|
Total:
|
|
$
|
90,135
|
|
|
|
|
|
|
|
Section 12 — Conditions to
the Offer
Should
the Offer be terminated pursuant to any of the foregoing provisions, all
tendered Shares not theretofore accepted for payment shall forthwith be returned
to the tendering shareholders. For further information on conditions
to this Offer, please see the Agreement.
Section 13 — Certain Legal
Matters
Except as
described in this section, based on a review of publicly available filings by
GEE with the Commission and a review of certain information furnished by GEE in
the normal course of their business dealings, we are not aware of any license,
franchise or regulatory permit that is material to the business of GEE and that
would be materially adversely affected by our acquisition of Shares pursuant to
the Offer, or of any material filing, approval or other action by or with any
governmental authority or regulatory agency that would be required for the
purchase of Shares pursuant to the Offer or of our acquisition or ownership of
Shares pursuant to the Offer. Should any such approval or other action be
required, it is presently contemplated that such approval or action would be
sought, except as described below under “— State Takeover Laws.” While we
do not currently intend to delay acceptance for payment of Shares tendered
pursuant to the Offer pending the outcome of any such matter, there can be no
assurance that any such approval or other action, if required, would be obtained
without substantial conditions or that adverse consequences would not result to
GEE’s business or that certain parts of GEE’s business would not have to be
disposed of in the event that such approval were not obtained or such other
actions were not taken or in order to obtain any such approval or other action.
If certain types of adverse action are taken with respect to the matters
discussed below, we may decline to accept for payment or pay for any Shares
tendered.
GEE and
certain of its subsidiaries conduct business in a number of states throughout
the United States, some of which have adopted laws and regulations applicable to
offers to acquire shares of corporations that are incorporated or have
substantial assets, stockholders and/or a principal place of business in such
states. In Edgar v. Mite
Corp., the Supreme Court held that the Illinois Business Takeover
Statute, which involved state securities laws that made the takeover of certain
corporations more difficult, imposed a substantial burden on interstate commerce
and was therefore unconstitutional. In CTS Corp. v. Dynamics Corp. of
America, however, the Supreme Court held that a state may, as a matter of
corporate law and, in particular, those laws concerning corporate governance,
constitutionally disqualify a potential acquiror from voting on the affairs of a
target corporation without prior approval of the remaining stockholders,
provided that such laws were applicable only under certain conditions, in
particular, that the corporation has a substantial number of stockholders in and
is incorporated under the laws of such state. Subsequently, in TLX Acquisition Corp. v. Telex
Corp., a federal district court in Oklahoma ruled that the Oklahoma
statutes were unconstitutional insofar as they applied to corporations
incorporated outside Oklahoma in that they would subject such corporations to
inconsistent regulations. Similarly, in Tyson Foods, Inc. v.
McReynolds, a federal district court in Tennessee ruled that four
Tennessee takeover statutes were unconstitutional as applied to corporations
incorporated outside Tennessee. This decision was affirmed by the
U.S. Court of Appeals for the Sixth Circuit.
GEE
conducts business in a number of states throughout the United States, some of
which have enacted takeover laws. We have not determined whether any of these
state takeover laws and regulations will by their terms apply to the Offer,
and, we have not presently sought to comply with any state takeover
statute or regulation. We reserve the right to challenge the applicability or
validity of any state law or regulation purporting to apply to the Offer, and
neither anything in this Offer nor any action taken in connection
herewith is intended as a waiver of such right. In the event it is established
that one or more state takeover statutes is applicable to the Offer and an
appropriate court does not determine that such statute is inapplicable or
invalid as applied to the Offer, we might be required to file certain
information with, or to receive approval from, the relevant state authorities,
and we might be unable to accept for payment or pay for Shares tendered pursuant
to the Offer, or be delayed in consummating the Offer. In addition, if enjoined,
we might be unable to accept for payment any Shares tendered pursuant to the
Offer,
or be
delayed in continuing or consummating. In such case, we may not be obligated to
accept for payment any Shares tendered. See “— Section 12 —
Conditions to the Offer.”
Under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “HSR Act”), and the
rules that have been promulgated there under by the Federal Trade
Commission (“FTC”), certain acquisition transactions may not be consummated
unless certain information has been furnished to the Antitrust Division of the
Department of Justice (the “Antitrust Division”) and the FTC and certain waiting
period requirements have been satisfied. The purchase of Shares pursuant to the
Offer and the purchase of the New Issue Shares is not subject to such
requirements due to the fact that the total value of the transactions on a
consolidated basis do not meet the minimum threshold that requires compliance
with the notice and approval provisions of the HSR Act.
Section 14 —
Miscellaneous
The Offer
is being made to all holders of Shares other than PSQ. We are not aware of any
jurisdiction where the making of the Offer is prohibited by administrative or
judicial action pursuant to any valid state statute. If we become aware of any
valid state statute prohibiting the making of the Offer or the acceptance of
Shares pursuant thereto, we will make a good faith effort to comply with any
such state statute or seek to have such statute declared inapplicable to the
Offer. If, after such good faith effort, we cannot comply with any such state
statute, the Offer will not be made to (nor will tenders be accepted from or on
behalf of) the holders of Shares in such state. In any jurisdiction where the
securities, blue sky or other laws require the Offer to be made by a licensed
broker or dealer, the Offer will be deemed to be made on our behalf by one or
more registered brokers or dealers licensed under the laws of such
jurisdiction.
No person has been authorized to give
any information or make any representation on behalf of GEE or PSQ not contained
in this Offer or in the related Letter of
Transmittal and, if given or made, such information or representation must not
be relied upon as having been authorized.
We have
filed with the Commission a tender offer statement on Schedule TO, together
with all exhibits thereto, pursuant to Regulation M-A under the Exchange
Act, furnishing certain additional information with respect to the Offer. Such
Schedules and any amendments thereto, including exhibits, may be inspected and
copies may be obtained from the offices of the Commission in the manner set
forth in “— Section 7 — Certain Information Concerning
GEE.”
April 15,
2009
Manually
signed facsimile copies of the Letter of Transmittal will be accepted. Letters
of Transmittal and certificates for Shares should be sent or delivered by each
GEE shareholder or his, her or its broker, dealer, commercial bank, trust
company or other nominee to the Depositary at its address set forth
below:
The
Depositary for the Offer is:
Continental
Stock Transfer & Trust Company
17
Battery Place, 8th
Floor
Any
questions or requests for assistance may be directed to the Information Agent at
its address and telephone numbers set forth below. Requests for additional
copies of this Offer and the Letter of Transmittal may be directed to the
Information Agent or the Depositary. Stockholders may also contact their
brokers, dealers, commercial banks, trust companies or other nominees for
assistance concerning the Offer.
Morrow
& Co., LLC
470 West
Avenue
Stamford,
CT 06902
(203)
658-9400
Banks
and Brokerage Firms, Please Call: (203) 658-9400
Shareholders
Call Toll Free: (800) 607-0088