-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, BA9H+WJNCjWextHl9LYsszAVcuPqhZ2bsGgpHsOOlxPF4xwqnGrEDyYvxtC7gRgC 20qTc8iuHfMBEB4BAuci3Q== 0000935836-07-000199.txt : 20070509 0000935836-07-000199.hdr.sgml : 20070509 20070508191300 ACCESSION NUMBER: 0000935836-07-000199 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20070509 DATE AS OF CHANGE: 20070508 GROUP MEMBERS: ANDREW E. SHAPIRO SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: NATIONAL HOME HEALTH CARE CORP CENTRAL INDEX KEY: 0000728389 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-HOME HEALTH CARE SERVICES [8082] IRS NUMBER: 222981141 STATE OF INCORPORATION: DE FISCAL YEAR END: 0731 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-36303 FILM NUMBER: 07829731 BUSINESS ADDRESS: STREET 1: 700 WHITE PLAINS RD STREET 2: SUITE 275 CITY: SCARSDALE STATE: NY ZIP: 10583 BUSINESS PHONE: 9147229000 MAIL ADDRESS: STREET 1: 700 WHITE PLAINS RD STREET 2: SUITE 275 CITY: SCARSDALE STATE: NY ZIP: 10583 FORMER COMPANY: FORMER CONFORMED NAME: FAMILY MEDICAL TREATMENT CENTERS OF AMERICA INC DATE OF NAME CHANGE: 19850205 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: LAWNDALE CAPITAL MANAGEMENT LLC CENTRAL INDEX KEY: 0001267432 IRS NUMBER: 943233759 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A MAIL ADDRESS: STREET 1: 591 REDWOOD HIGHWAY CITY: MILL VALLEY STATE: CA ZIP: 94941 SC 13D/A 1 nhhc13d.htm NHHC13D

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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SCHEDULE 13D

Under the Securities Exchange Act of 1934
(Amendment No. 6)

National Home Health Care Corp.

(Name of Issuer)

Common Stock

(Title of Class of Securities)

636380107

(CUSIP Number)

Andrew E. Shapiro

Lawndale Capital Management, LLC

591 Redwood Highway, Suite 2345

Mill Valley, CA 94941

415-389-8258

Christopher J. Rupright, Esq.

Shartsis, Friese & Ginsburg LLP

One Maritime Plaza, 18th Floor

San Francisco, CA 94111

415-421-6500

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

May 8, 2007

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of sections 240.13d-1(e), 240.13d-1(f) or 140.13d-1(g), check the following box. [ ]

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See section 240.13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter the disclosures provided in a prior cover page.

The information required in the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

Potential persons who are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number.

 

1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only).

Lawndale Capital Management, LLC

2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) XX
(b) ______

3. SEC Use Only

4. Source of Funds (See Instructions) AF

5. Check if Disclosure of Legal Proceeding Is Required Pursuant to Items 2(d) or 2(e) ____

6. Citizenship or Place of Organization California

Number of

Shares

Beneficially

Owned by

Each Reporting

Person With

7. Sole Voting Power -0-

8. Shared Voting Power 395,389

9. Sole Dispositive Power -0-

10. Shared Dispositive Power 395,389

11. Aggregate Amount Beneficially Owned by Each Reporting Person 395,389

12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions) ______

13. Percent of Class Represented by Amount in Row (11) 7.0%

14. Type of Reporting Person (See Instructions)

OO, IA

 

1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only).

Andrew E. Shapiro

2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) XX
(b) ______

3. SEC Use Only

4. Source of Funds (See Instructions) AF

5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ____

6. Citizenship or Place of Organization United States

Number of

Shares

Beneficially

Owned by

Each Reporting

Person With

7. Sole Voting Power -0-

8. Shared Voting Power 395,389

9. Sole Dispositive Power -0-

10. Shared Dispositive Power 395,389

11. Aggregate Amount Beneficially Owned by Each Reporting Person 395,389

12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions) ______

13. Percent of Class Represented by Amount in Row (11) 7.0%

14. Type of Reporting Person (See Instructions)

IN

 

1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only).

Diamond A Partners, L.P.

2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) ______
(b) ______

3. SEC Use Only

4. Source of Funds (See Instructions) WC

5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) ____

6. Citizenship or Place of Organization California

Number of

Shares

Beneficially

Owned by

Each Reporting

Person With

7. Sole Voting Power -0-

8. Shared Voting Power 345,743

9. Sole Dispositive Power -0-

10. Shared Dispositive Power 345,743

11. Aggregate Amount Beneficially Owned by Each Reporting Person 345,743

12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions) ______

13. Percent of Class Represented by Amount in Row (11) 6.1%

14. Type of Reporting Person (See Instructions)

PN

Item 1. Security and Issuer

This statement relates to shares of Common Stock (the "Stock") of National Home Health Care Corp. (the "Issuer"). The principal executive office of the Issuer is located at 700 White Plains Road, Suite 275, Scarsdale, NY 10583.

Item 2. Identity and Background

The persons filing this statement and the persons enumerated in Instruction C of Schedule 13D and, where applicable, their respective places of organization, general partners, directors, executive officers and controlling persons, and the information regarding them, are as follows:

(a) Lawndale Capital Management, LLC ("Lawndale");
Andrew E. Shapiro ("Shapiro"); Diamond A Partners, L.P. ("DAP")
(collectively, the "Filers").

DAP is filing this statement jointly with the other Filers, but not as a member of a group and expressly disclaims membership in a group. Lawndale and Shapiro disclaim beneficial ownership of the Stock except to the extent of their respective pecuniary interests therein.

(b) The business address of the Filers is
591 Redwood Highway, Suite 2345, Mill Valley, CA 94941.

(c) Present principal occupation or employment of the Filers and the name, principal business and address of any corporation or other organization in which such employment is conducted:
LCM is the investment adviser to and the general partner of DAP, which is an investment limited partnership. Shapiro is the sole manager of LCM.

(d) During the last five years, none of the Filers has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).

(e) During the last five years, none of the Filers was a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

(f) Shapiro is a citizen of the United States of America.

 

Item 3. Source and Amount of Funds or Other Consideration

The source and amount of funds used in purchasing the Stock were as follows:

Purchaser

Source of Funds

Amount

LCM

Funds under Management (1)

$3,533,145.88

DAP

Working Capital

$3,089,015.16

(1) Includes funds of DAP invested in Stock.

Item 4. Purpose of Transaction

The Filers ("Lawndale") have continued to evaluate information that National Home Health Care Corp. ("NHHC") has made public so far as well as from other sources regarding NHHC's proposed merger transaction (the "Merger" or "Transaction") with affiliates of Angelo Gordon, in partnership with Eureka Capital Partners and members of management (all together the "Insider Group"). As disclosed in its prior filings of Schedule 13D, Lawndale sent letters (the "Letters") to NHHC's Board of Directors which were attached as Exhibit B to Amendments No. 2 through No. 5 detailing Lawndale's concerns regarding the Transaction, objecting to the merger consideration and process and indicating an intent to vote against the merger and seek appraisal rights unless certain changes were made.

On May 8, 2007, Lawndale sent a letter (a copy of which is attached as Exhibit B hereto, and incorporated by reference to this filing) to NHHC's Board of Directors informing it that Institutional Shareholder Services ("ISS") issued a May 4, 2007 report recommending its clients vote AGAINST approval of the Merger Agreement, specifically citing concerns raised by Lawndale.

As disclosed in Lawndale's prior letters, Lawndale believes the Merger Agreement was the result of an improper process and resulted in an unfair and inadequate price to the Company's public shareholders. Lawndale's May 8, 2007 letter filed herewith calls upon the board to, among other things, not enter into any subsequent agreement with the Insider Group unless such new agreement eliminates the termination ("break-up") fee and allows retaining an independent financial advisor to conduct a proper auction for a reasonable "go-shop" period.

Lawndale continues to generally support a sale of the Company, but only through a process that is fair to the Company's public stockholders and results in a fair price being paid to the public stockholders.

Lawndale has been and may continue to be in contact with NHHC management, members of NHHC's Board of Directors, prospective acquirers, other shareowners, their advisors and others regarding the Merger and other alternatives that NHHC could employ to maximize shareowner value. Lawndale acquired the Stock solely for investment purposes, and Lawndale may from time to time buy or sell the Stock at its discretion.

Item 5. Interest in Securities of the Issuer

The beneficial ownership of the Stock by each Filer at the date hereof is reflected on that Filer's cover page.

The Filers effected the following transactions in the Stock in open market transactions on the dates indicated, and such transactions are the only transactions in the Stock by the Filers since March 9, 2007:

Name

Purchase or Sale

Date

Number of Shares

Purchase Price

DAP

P

3/12/2007

144

11.39

 

 

Item 6. Contracts, Arrangement, Understandings or Relationships with Respect to Securities of the Issuer

LCM is the general partner of its clients pursuant to limited partnership agreements providing to LCM the authority, among other things, to invest the funds of such clients in Stock, to vote and dispose of Stock and to file this statement on behalf of such clients. Pursuant to such limited partnership agreements, the general partner of such clients is entitled to allocations based on assets under management and realized and unrealized gains.

Item 7. Material to Be Filed as Exhibits

Exhibit A: Agreement Regarding Joint Filing of Statement on Schedule 13D or 13G.

Exhibit B: Letter from Lawndale Capital Management, LLC to the Board of Directors of NHHC dated May 8, 2007.

SIGNATURES

After reasonable inquiry and to the best of my knowledge, I certify that the information set forth in this statement is true, complete and correct.

Dated: May 8, 2007

Lawndale Capital Management, LLC


By: Andrew E. Shapiro, Manager

Diamond A Partners, L.P.

By: Lawndale Capital Management, LLC

General Partner

By: Andrew E. Shapiro, Manager

Andrew E. Shapiro

  

EXHIBIT A

AGREEMENT REGARDING JOINT FILING

OF STATEMENT ON SCHEDULE 13D OR 13G

The undersigned agree to file jointly with the Securities and Exchange Commission (the "SEC") any and all statements on Schedule 13D or Schedule 13G (and any amendments or supplements thereto) required under section 13(d) of the Securities Exchange Act of 1934, as amended, in connection with purchases by the undersigned of the common stock of National Home Health Care Corp. For that purpose, the undersigned hereby constitute and appoint Lawndale Capital Management, LLC as their true and lawful agent and attorney-in-fact, with full power and authority for and on behalf of the undersigned to prepare or cause to be prepared, sign, file with the SEC and furnish to any other person all certificates, instruments, agreements and documents necessary to comply with section 13(d) and section 16(a) of the Securities Exchange Act of 1934, as amended, in connection with said purchases, and to do and perform every act necessary and proper to be done incident to the exercise of the foregoing power, as full y as the undersigned might or could do if personally present.

 

Dated: June 15, 2006

LAWNDALE CAPITAL MANAGEMENT, LLC

 

By: Andrew E. Shapiro, Manager

Diamond A Partners, L.P.

By: Lawndale Capital Management, LLC

General Partner

By: Andrew E. Shapiro, Manager

 

Andrew E. Shapiro

  

EXHIBIT B

LETTER TO BOARD MEMBERS OF NATIONAL HOME HEALTH CARE

 

 

Andrew Shapiro

President

May 8, 2007

Board of Directors

National Home Health Care Corp.

c/o Corporate Secretary

700 White Plains Road, Suite 275

Scarsdale, NY 10583

To the Board Members of National Home Health Care:

Lawndale Capital Management and its affiliates have been long-term shareowners of National Home Health Care Corp. ("NHHC" or the "Company") and remain the Company's third largest independent shareowner, owning 395,389 shares, or 7.0% of NHHC's outstanding shares. As we have said in prior letters, it is time to level the playing field and maximize value for shareholders via a full and fair auction that has still not taken place. As you presumably know, Institutional Shareholder Services (ISS), the world's largest proxy advisor, has recommended its clients vote against the proposed merger between National Home Health Care and Angelo Gordon.

In its analysis opposing the merger vote, ISS agreed with much of our analysis as set forth in our prior letters to you. Indeed, ISS's report explicitly states that "We agree with many of the concerns raised by the dissidents . . . we do not find a compelling argument why an auction process, open to all types of potential acquirers, could [not]1 have been conducted." ISS went on to say "we believe the process was not properly managed" and concluded, "We believe that multiple conflicts of interest in the negotiations with only one bidder have led to a final offer price that could be improved with a fair process."

No Full And Fair Auction Has Taken Place

We understand that NHHC's Special Committee has finally admitted the obvious, and determined that Premier Home Health Care's $12/share bid tied to a lower EBITDA threshold and higher appraisal rights threshold is superior to the Angelo Gordon/Insider group's $11.35-$11.50/share bid. Unfortunately, the Premier Offer only demonstrates what we have been saying since the beginning: that had the NHHC board acted properly on behalf of the shareholders the Company could have attracted a superior agreement and price than the Angelo Gordon/Insider buyout.

1 On May 7, 2007, ISS sent out an "informational alert" with this correction to the typographical error in its original May 4, 2007 published report.

 

The problem now faced by NHHC's shareholders is whether the improper actions taken by the board have so corrupted the process that achieving a value maximizing transaction on behalf of the shareholders is impossible. We believe that this is a real risk, particularly as a result of the improper aspects of the original Merger Agreement, and in particular the Agreement's no shop/no solicitation clauses, the right for the Angelo Gordon/Insider group to knock out an alternative bidder from the process by simply matching the alternative bid, and the termination ("break-up") fee of the Merger Agreement, which still costs shareowners directly up to over $0.40/share higher value from any superior bid from Premier or other alternative bidder.

Such provisions have no place in any proper auction. Accordingly, we continue to call upon NHHC's independent directors to act in a responsible manner, and refuse to enter into any subsequent agreement with the Angelo Gordon/Insider Group unless such new agreement eliminates a break-up fee and allows for a reasonable "go-shop" period. The reality here is that this should not be the end of the auction but the beginning. Only because of the improper actions of the board have NHHC's shareholders been denied full value for the Company, and only by leveling the playing field do shareholders have the opportunity to obtain fair value.

Premier's bid reflects not an example of an auction, but presents a superior offer despite all the structural impediments and "deal protections" the NHHC board has put in place to deter bids that don't accommodate Fialkow family interests. Furthermore, the Scott-Macon and Castle Crow letters, sent on behalf of their private equity clients, illustrate the high potential for meaningful alternative bidding for NHHC in the absence of Angelo Gordon/Insider Merger Agreement's improper and onerous hurdles.

Accordingly, we once again ask you to retain suitable investment bankers to conduct a full and fair auction for the Company. Our actions have helped result in a modest increase in the offer to NHHC's shareholders. But assertions by NHHC that Lawndale's public efforts are a substitute for a full and fair auction are ridiculous. Now it is time for the NHHC board to stand up and act on behalf of shareholders to obtain "the best price reasonably obtainable." We hope the board will stop putting the interests of the Fialkow family before its duties to the public shareholders.

 

Yours Sincerely,

 

 

Andrew E. Shapiro

President

 

 

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