SC TO-I: Issuer tender offer statement
Published on February 25, 2002
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________________
SCHEDULE TO
(Rule 13e-4)
TENDER OFFER STATEMENT UNDER SECTION 14(d)(1) OR 13(e)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
____________________________
KORN/FERRY INTERNATIONAL
(Name of Subject Company (Issuer) and Filing Person (Offeror))
____________________________
Options to Purchase Common Stock, Par Value $0.01 Per Share, of Korn/Ferry
International and Stock Appreciation Rights under the Korn/Ferry International
Performance Award Plan, Having an Exercise or Base Price of More than $13.00
(Title of Class of Securities)
____________________________
500643 20 0
(CUSIP Number of Class of Securities (Underlying Common Stock))
____________________________
Peter L. Dunn, General Counsel
Korn/Ferry International
1800 Century Park East, Suite 900
Los Angeles, California 90067
(310) 552-1834
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Filing Person)
Copy to:
Steven B. Stokdyk
Sullivan & Cromwell
1888 Century Park East, 21st Floor
Los Angeles, California 90067
____________________________
CALCULATION OF FILING FEE
Transaction Valuation* Amount of Filing Fee
$25,098,974 $2,310.00
* Calculated solely for purposes of determining the filing fee. This amount
assumes that options to purchase 6,733,886 shares of common stock of Korn/Ferry
International having an aggregate value of $25,098,974 as of February 21, 2002
will be exchanged pursuant to this offer. The aggregate value of such options
was calculated based on the Black-Scholes option pricing model.
[_] Check the box if any part of the fee is offset as provided by Rule 0-
11(a)(2) and identify the filing with which the offsetting fee was previously
paid. Identify the previous filing by registration statement number, or the Form
or Schedule, and the date of its filing.
Amount Previously Paid: Not applicable. Filing Party: Not applicable.
Form or Registration No.: Not applicable. Date Filed: Not applicable.
[_] Check the box if the filing relates solely to preliminary communications
made before the commencement of a tender offer.
Check the appropriate boxes below to designate any transactions to which the
statement relates:
[_] third party tender offer subject to Rule 14d-1.
[X] issuer tender offer subject to Rule 13e-4.
[_] going-private transaction subject to Rule 13e-3.
[_] amendment to Schedule 13D under Rule 13d-2.
Check the following box if the filing is a final amendment reporting the results
of the tender offer. [_]
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ITEM 1. SUMMARY TERM SHEET.
The information set forth under "Summary Term Sheet" in the Offer to
Exchange, dated February 25, 2002 (the "Offer to Exchange"), attached
hereto as Exhibit (a)(1), is incorporated herein by reference.
ITEM 2. SUBJECT COMPANY INFORMATION.
(a) The name of the issuer is Korn/Ferry International, a Delaware
corporation (the "Company"), and the address of its principal executive
offices is 1800 Century Park East, Suite 900, Los Angeles, California
90067. The Company's phone number is (310) 552-1834. The information set
forth in the Offer to Exchange under Section 9 ("Information Concerning
Korn/Ferry") is incorporated herein by reference.
(b) This statement on Schedule TO relates to an offer by the Company to
current employees of the Company to exchange certain options (the "Existing
Options") to purchase shares of the Company's common stock, par value $0.01
per share (the "Common Stock"), and certain stock appreciation rights under
the Korn/Ferry International Performance Award Plan (the "Plan") having an
exercise or base price of more than $13.00, in exchange for replacement
options (the "Replacement Options") to purchase shares of the Common Stock
and replacement stock appreciation rights, respectively, to be granted
under the Plan upon the terms and subject to the conditions described in
the Offer to Exchange and the related Letter of Transmittal (the "Letter of
Transmittal" and, together with the Offer to Exchange, as they may be
amended from time to time, the "Offer"), attached hereto as Exhibit (a)(2).
Members of the Company's board of directors and executive officers of the
Company are not eligible to participate in this Offer. There were eligible
options to purchase 6,733,886 shares of Common Stock having an aggregate
value of $25,098,974 as of February 21, 2002. The number of shares of
Common Stock underlying the Replacement Options to be granted to each
option holder will be equal to the number of shares of Common Stock
underlying the Existing Options elected to be exchanged by the option
holder and accepted for exchange divided by the following swap ratio
corresponding to the applicable exercise price of the Existing Options:
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Exercise Price Swap Ratio
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$13.00 and below Not applicable
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$13.01 - $15.00 1.50
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$15.01 - $20.00 1.75
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$20.01 - $25.00 2.50
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$25.01 - $30.00 3.00
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$30.01 and above 3.50
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The exercise price of the Replacement Options will equal the closing sales
price of the Common Stock as reported on the New York Stock Exchange on the
date on which the Replacement Options are granted. The terms of the
replacement stock appreciation rights will be determined in a manner
similar to that used to determine the terms of the replacement stock
options. The information set forth in the Offer to Exchange under "Summary
Term Sheet," Section 1 ("Number of Options; Expiration Date"), Section 5
("Acceptance of Options for Exchange and Issuance of Replacement Options")
and Section 8 ("Source and Amount of Consideration; Terms of Replacement
Options") is incorporated herein by reference.
(c) The information set forth in the Offer to Exchange under Section 7
("Price Range of Common Stock Underlying the Options") is incorporated
herein by reference.
ITEM 3. IDENTITY AND BACKGROUND OF FILING PERSON.
(a) The information set forth under Item 2(a) above is incorporated
herein by reference.
ITEM 4. TERMS OF THE TRANSACTION.
(a) The information set forth in the Offer to Exchange under "Summary
Term Sheet," Section 1 ("Number of Options; Expiration Date"), Section 3
("Procedures for Electing to Exchange Options"), Section 4 ("Withdrawal
Rights"), Section 5 ("Acceptance of Options for Exchange and Issuance of
Replacement Options"), Section 6 ("Conditions of the Offer"), Section 8
("Source and Amount of Consideration; Terms
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of Replacement Options"), Section 11 ("Status of Options Acquired by Us in
the Offer; Accounting Consequences of the Offer"), Section 12 ("Legal
Matters; Regulatory Approvals"), Section 13 ("Material Federal Income Tax
Consequences") and Section 14 ("Extension of Offer; Termination;
Amendment") is incorporated herein by reference.
(b) Members of the Company's board of directors and the executive officers
of the Company are not eligible to participate in this Offer. The
information set forth in the Offer to Exchange under Section 10 ("Interests
of Directors and Officers; Transactions and Arrangements Concerning the
Options") is incorporated herein by reference.
ITEM 5. PAST CONTACTS, TRANSACTIONS, NEGOTIATIONS AND ARRANGEMENTS.
(e) The information set forth in the Offer to Exchange under Section 10
("Interests of Directors and Officers; Transactions and Arrangements
Concerning the Options") is incorporated herein by reference. The Plan
filed as Exhibit (d)(1) hereto, Amendments to the Plan filed as Exhibit
(d)(2) hereto and the Form of Replacement Stock Option Agreement pursuant
to the Plan filed as Exhibit (d)(3) hereto and the Form of Replacement
Stock Appreciation Right Agreement pursuant to the Plan filed as Exhibit
(d)(4) hereto contain information regarding the subject securities.
ITEM 6. PURPOSES OF THE TRANSACTION AND PLANS OR PROPOSALS.
(a) The information set forth in the Offer to Exchange under Section 2
("Purpose of the Offer") is incorporated herein by reference.
(b) The information set forth in the Offer to Exchange under Section 5
("Acceptance of Options for Exchange and Issuance of Replacement Options")
and Section 11 ("Status of Options Acquired by Us in the Offer; Accounting
Consequences of the Offer") is incorporated herein by reference.
(c) The information set forth in the Offer to Exchange under Section 2
("Purpose of the Offer") is incorporated herein by reference.
ITEM 7. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) The information set forth in the Offer to Exchange under Section 8
("Source and Amount of Consideration; Terms of Replacement Options") and
Section 15 ("Fees and Expenses") is incorporated herein by reference.
(b) Not applicable.
(d) Not applicable.
ITEM 8. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
(a) Not applicable.
(b) The information set forth in the Offer to Exchange under Section 10
("Interests of Directors and Officers; Transactions and Arrangements
Concerning the Options") is incorporated herein by reference.
ITEM 9. PERSON/ASSETS, RETAINED, EMPLOYED, COMPENSATED OR USED.
(a) Not applicable.
ITEM 10. FINANCIAL STATEMENTS.
(a) The information set forth in the Offer to Exchange under Section 9
("Information Concerning Korn/Ferry") and Section 16 ("Additional
Information"), Item 8 of the Company's Annual Report on Form 10-K, as
amended, for its fiscal year ended April 30, 2001 and Item 1 of the
Company's Quarterly Report on Form 10-Q for its fiscal quarter ended
October 31, 2001 is incorporated herein by reference. The
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information required by Item 1010(a)(3) of Regulation M-A promulgated under
the Securities Exchange Act of 1934, amended, is not applicable.
(b) Not applicable.
ITEM 11. ADDITIONAL INFORMATION.
(a) The information set forth in the Offer to Exchange under Section 10
("Interests of Directors and Officers; Transactions and Arrangements
Concerning the Options") and Section 12 ("Legal Matters; Regulatory
Approvals") is incorporated herein by reference.
(b) Not applicable.
ITEM 12. EXHIBITS.
(a) (1) Offer to Exchange, dated February 25, 2002.
(2) Form of Letter of Transmittal.
(3) Form of Notice of Withdrawal.
(4) Form of Grant Detail Report.
(5) Cover Letter to Employees, dated February 25, 2002.
(6) Email to employees holding options and stock appreciation rights
granted under the Korn/Ferry International Performance Award Plan, dated
February 25, 2002, filed as Exhibit (a)(1) on Schedule TO with the
Securities and Exchange Commission (the "SEC") on February 25, 2002 and
incorporated herein by reference.
(7) Korn/Ferry International Annual Report on Form 10-K for its
fiscal year ended April 30, 2001, filed with the SEC on July 30, 2001 and
incorporated herein by reference.
(8) Korn/Ferry International Amendment to Form 10-K for its fiscal
year ended April 30, 2001, filed on Form 10-K/A with the SEC on August 8,
2001 and incorporated herein by reference.
(9) Korn/Ferry International Quarterly Report on Form 10-Q for its
fiscal quarter ended October 31, 2001, filed with the SEC on December 17,
2001 and incorporated herein by reference.
(b) Not applicable.
(d) (1) Korn/Ferry International Performance Award Plan, filed with the
SEC on September 4, 1998 as Exhibit 10.2 to the Company's Registration
Statement on Form S-1 (File No. 333-61697) and incorporated herein by
reference.
(2) Amendments to the Korn/Ferry International Performance Award
Plan, filed with the SEC on July 30, 2001 as Exhibit 10.3 to the Company's
Annual Report on Form 10-K and incorporated herein by reference.
(3) Form of Replacement Stock Option Agreement Pursuant to the
Korn/Ferry International Performance Award Plan.
(4) Form of Replacement Stock Appreciation Right Agreement Pursuant
to the Korn/Ferry International Performance Award Plan.
(g) Not applicable.
(h) Not applicable.
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ITEM 13. INFORMATION REQUIRED BY SCHEDULE 13E-3.
Not applicable.
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SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
KORN/FERRY INTERNATIONAL
/s/ Peter L. Dunn
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Peter L. Dunn
General Counsel
Date: February 25, 2002
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INDEX TO EXHIBITS
Exhibit Number Description
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(a)(1) Offer to Exchange, dated February 25, 2002.
(a)(2) Form of Letter of Transmittal.
(a)(3) Form of Notice of Withdrawal.
(a)(4) Form of Grant Detail Report.
(a)(5) Cover Letter to Employees, dated February 25, 2002.
(a)(6) Email to Employees holding options granted under the
Korn/Ferry International Performance Award Plan, dated
February 25, 2002, filed as Exhibit (a)(1) on Schedule
TO with the SEC on February 25, 2002 and incorporated
herein by reference.
(a)(7) Korn/Ferry International Annual Report on Form 10-K for
its fiscal year ended April 30, 2001, filed with the SEC
on July 30, 2001 and incorporated herein by reference.
(a)(8) Korn/Ferry International Amendment to Form 10-K for its
fiscal year ended April 30, 2001, filed on Form 10-K/A
with the SEC on August 8, 2001 and incorporated herein
by reference.
(a)(9) Korn/Ferry International Quarterly Report on Form 10-Q
for its fiscal quarter ended October 31, 2001, filed
with the SEC on December 17, 2001 and incorporated
herein by reference.
(d)(1) Korn/Ferry International Performance Award Plan, filed
with the SEC on September 4, 1998 as Exhibit 10.2 to the
Company's Registration Statement on Form S-1 (File No.
333-61697) and incorporated herein by reference.
(d)(2) Amendments to the Korn/Ferry International Performance
Award Plan, filed with the SEC on July 30, 2001 as
Exhibit 10.3 to the Company's Annual Report on Form 10-K
and incorporated herein by reference.
(d)(3) Form of Replacement Stock Option Agreement Pursuant to
the Korn/Ferry International Performance Award Plan.
(d)(4) Form of Replacement Stock Appreciation Right Agreement
Pursuant to the Korn/Ferry International Performance
Award Plan.
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