Interstate
National Dealer Services, Inc. announced Sept. 27 that it
has entered into an agreement and plan of merger with CHL Holdings
Corp., a company owned by Cindy H. Luby, Interstate's chief operating
officer and a director.
Under the merger agreement, Interstate will be merged with CHL,
with Interstate as the surviving entity. As previously announced, upon
completion of the merger, each issued and outstanding share of
Interstate common stock, other than shares held by Chester J. Luby,
Cindy H. Luby, Joan Luby and CHL, and by stockholders who exercise
their appraisal rights, will be entitled to receive $6.00 per share in
cash, without interest and less withholding taxes, if any. After the
merger, Interstate will be owned by members of the Luby family.
Interstate's Board of Directors, acting on the recommendation of a
special committee composed entirely of directors who are not
affiliated with the Luby family, approved the merger agreement. As
directors with an interest in the proposed transaction, Chester L.
Luby and Cindy H. Luby did not participate in the Board's vote.
Legg Mason Wood Walker, Incorporated which has acted as financial
advisor to the special committee, has issued a fairness opinion in
connection with the merger. The closing of the merger is subject to
customary conditions, including approval of Interstate's stockholders,
and the receipt by CHL of the funds required to complete the
transaction. CHL has received a banking commitment to advance the
necessary funds.
As soon as practicable, Interstate will file a proxy statement
relating to the merger with the Securities and Exchange Commission,
will schedule a special meeting of its stockholders to vote on a
proposal to approve the merger agreement and the transactions it
contemplates and will mail the proxy statement to its stockholders.
Interstate's Board has recommended that the stockholders approve the
merger agreement. Interstate has entered into a voting agreement with
members of the Luby family and with CHL in which they have agreed to
vote in favor of the merger agreement. Members of the Luby family own
and have the right to vote approximately 24.6% of Interstate's common
stock.
When available, Interstate's stockholders will be able to obtain a
free copy of the proxy statement to be filed with the Securities and
Exchange Commission at the SEC's web site at www.sec.gov. The proxy
statement and other documents filed with the Securities and Exchange
Commission by Interstate may also be obtained for free from Interstate
by directing a request to Interstate National Dealer Services, Inc. at
333 Earle Ovington Blvd., Uniondale, New York 11553, Attn: Zvi D.
Sprung, Chief Financial Officer.
Interstate is a nationwide provider of service contracts
and extended warranties, primarily for new and used cars and
recreational vehicles, as well as watercraft, manufactured housing,
motorcycles and other power sport vehicles. For additional information
please visit the websites www.inds.com and www.warrantydirect.com.
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