-----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, QB5Zj0kZFv0rPvhTG79UoyHKGAiIEwlIfe6mRIfpwgiWwwPOR5m9u+Kflp7kSsbd djOvc1iUfcYub08hJ1hSrg== 0000921895-00-000909.txt : 20001225 0000921895-00-000909.hdr.sgml : 20001225 ACCESSION NUMBER: 0000921895-00-000909 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20001222 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: GEHL CO CENTRAL INDEX KEY: 0000856386 STANDARD INDUSTRIAL CLASSIFICATION: FARM MACHINERY & EQUIPMENT [3523] IRS NUMBER: 390300430 STATE OF INCORPORATION: WI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: SEC FILE NUMBER: 005-40747 FILM NUMBER: 794326 BUSINESS ADDRESS: STREET 1: 143 WATER STREET CITY: WEST BEND STATE: WI ZIP: 53095 BUSINESS PHONE: 4143349461 MAIL ADDRESS: STREET 1: 143 WATER STREET CITY: WEST BEND STATE: WI ZIP: 53095 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: NEWCASTLE PARTNERS L P CENTRAL INDEX KEY: 0000932334 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 752574953 STATE OF INCORPORATION: TX FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 4514 COLE AVE STREET 2: STE 600 CITY: DALLAS STATE: TX ZIP: 79205 BUSINESS PHONE: 2145597145 MAIL ADDRESS: STREET 1: 4514 COLE AVE STREET 2: STE 600 CITY: DALLAS STATE: TX ZIP: 79205 SC 13D/A 1 0001.txt SC 13D/A - AMENDMENT NO. 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 -------------- SCHEDULE 13D (Rule 13d-101) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a) (Amendment No. 1)1 GEHL COMPANY - -------------------------------------------------------------------------------- (Name of Issuer) COMMON STOCK, PAR VALUE $.10 PER SHARE - -------------------------------------------------------------------------------- (Title of Class of Securities) 368483103 - -------------------------------------------------------------------------------- (CUSIP Number) STEVEN WOLOSKY, ESQ. OLSHAN GRUNDMAN FROME ROSENZWEIG & WOLOSKY LLP 505 Park Avenue New York, New York 10022 (212) 753-7200 - -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) December 22, 2000 - -------------------------------------------------------------------------------- (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 Rule 13d-1(e), 13d-1(f) or 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 Rule 13d-7 for other parties to whom copies are to be sent. (Continued on following pages) (Page 1 of 13 Pages) - -------- 1 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 disclosures provided in a prior cover page. The information required on 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 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). - ------------------------------- ---------------------------------- CUSIP No. 368483103 13D Page 2 of 13 Pages - ------------------------------- ---------------------------------- ================================================================================ 1 NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) NEWCASTLE FOCUS FUND II, L.P. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |x| (b) |_| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) |_| - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION TEXAS - -------------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES BENEFICIALLY 154,000 OWNED BY EACH REPORTING ----------------------------------------------------------------- PERSON WITH 8 SHARED VOTING POWER -0- ----------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 154,000 ----------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER -0- - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 154,000 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_| - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 2.9% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* PN ================================================================================ *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------- ---------------------------------- CUSIP No. 368483103 13D Page 3 of 13 Pages - ------------------------------- ---------------------------------- ================================================================================ 1 NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) NEWCASTLE PARTNERS, L.P. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |x| (b) |_| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* WC - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) |_| - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION TEXAS - -------------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES BENEFICIALLY 94,200 OWNED BY EACH ----------------------------------------------------------------- REPORTING 8 SHARED VOTING POWER PERSON WITH -0- ----------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 94,200 ----------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER -0- - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 94,200 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_| - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 1.8% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* PN ================================================================================ *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------- ---------------------------------- CUSIP No. 368483103 13D Page 4 of 13 Pages - ------------------------------- ---------------------------------- ================================================================================ 1 NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) MARK E. SCHWARZ - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |x| (b) |_| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) |_| - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION USA - -------------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES BENEFICIALLY 94,200 OWNED BY ----------------------------------------------------------------- EACH 8 SHARED VOTING POWER REPORTING PERSON WITH 154,000 ----------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 94,200 ----------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 154,000 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 248,200 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_| - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 4.6% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* IN ================================================================================ *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------- ---------------------------------- CUSIP No. 368483103 13D Page 5 of 13 Pages - ------------------------------- ---------------------------------- ================================================================================ 1 NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) CIC EQUITY PARTNERS, LTD. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |x| (b) |_| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* WC - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) |_| - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION TEXAS - -------------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES BENEFICIALLY 97,800 OWNED BY EACH REPORTING ----------------------------------------------------------------- PERSON WITH 8 SHARED VOTING POWER -0- ----------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 97,800 ----------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER -0- - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 97,800 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_| - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 1.8% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* PN ================================================================================ *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------- ---------------------------------- CUSIP No. 368483103 13D Page 6 of 13 Pages - ------------------------------- ---------------------------------- ================================================================================ 1 NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) PAUL DEROBBIO - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |x| (b) |_| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) |_| - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION USA - -------------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES BENEFICIALLY 97,800 OWNED BY EACH REPORTING ----------------------------------------------------------------- PERSON WITH 8 SHARED VOTING POWER -0- ----------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 97,800 ----------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER -0- - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 97,800 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_| - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 1.8% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* IN ================================================================================ *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------- ---------------------------------- CUSIP No. 368483103 13D Page 7 of 13 Pages - ------------------------------- ---------------------------------- ================================================================================ 1 NAME OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) HAROLD C. SIMMONS - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |x| (b) |_| - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) |_| - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION USA - -------------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES BENEFICIALLY -0- OWNED BY EACH REPORTING ----------------------------------------------------------------- PERSON WITH 8 SHARED VOTING POWER 154,000 ----------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER -0- ----------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 154,000 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 154,000 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_| - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 2.9% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* IN ================================================================================ *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------- ---------------------------------- CUSIP No. 368483103 13D Page 8 of 13 Pages - ------------------------------- ---------------------------------- The following constitutes Amendment No. 1 ("Amendment No. 1") to the Schedule 13D filed by the undersigned. This Amendment No. 1 amends the Schedule 13D as specifically set forth. Item 4 is amended to add the following paragraph: Two of the Reporting Persons, CIC and Newcastle Partners, have proposed to acquire, through an appropriate acquisition entity to be formed, the outstanding capital stock of the Issuer in a negotiated transaction. CIC and Newcastle Partners believe that such a transaction would provide the Issuer's stockholders with an opportunity to maximize the present value of their investment. CIC and Newcastle Partners delivered a letter dated December 22, 2000 to the Issuer submitting an offer to acquire the outstanding capital stock of the Issuer for $18.00 per Share in cash. The offer is subject to certain conditions, including completion of due diligence, obtaining all necessary financing, obtaining all necessary consents and approvals, including board and stockholder approval, amendment of the shareholder rights plan, waiver of any anti-takeover provisions and certain other customary conditions. A copy of the December 22, 2000 letter is filed as an exhibit to this Schedule 13D and incorporated herein by reference. CIC and Newcastle Partners are prepared to immediately enter into negotiations with the Issuer to finalize the terms of the proposed transaction. Item 5(a) and (b) are amended to read as follows: (a) and (b) The aggregate percentage of Shares of Common Stock reported owned by each person named herein is based upon 5,374,621 Shares outstanding, which is the total number of Shares of Common Stock outstanding as reported in the Issuer's Quarterly Report on Form 10-Q for the quarter ended September 30, 2000 and filed with the Securities and Exchange Commission on November 9, 2000. As of the close of business on December 22, 2000, Newcastle Focus beneficially owned 154,000 Shares of Common Stock, constituting approximately 2.9% of the Shares outstanding. Newcastle Partners beneficially owned 94,200 Shares of Common Stock, constituting approximately 1.8% of the Shares outstanding. Mr. Schwarz may be deemed to beneficially own 248,200 Shares, representing approximately 4.6% of the Shares outstanding. Mr. Schwarz has sole voting and dispositive power with respect to the 94,200 Shares owned by Newcastle Partners by virtue of his position with Newcastle Partners. Harold C. Simmons may be deemed a beneficial owner of the 154,000 Shares of Common Stock held by Newcastle Focus because a trust for which Mr. Simmons serves as sole trustee, with sole voting and dispositive power over its - ------------------------------- ---------------------------------- CUSIP No. 368483103 13D Page 9 of 13 Pages - ------------------------------- ---------------------------------- investment in Newcastle Focus, currently is the sole limited partner of Newcastle Focus. So long as such trust is the sole limited partner of Newcastle Focus, the sole limited partner can cause the termination of the limited partnership on thirty days' written notice. In the event of a dissolution or distribution by Newcastle Focus, with its current ownership structure, substantially all of such Shares could become assets of the trust. By virtue of this ownership structure and Mr. Schwarz's position with Newcastle Focus, Mr. Schwarz and Mr. Simmons may be deemed to share the power to vote and direct the disposition of the Shares held of record by Newcastle Focus. Mr. Simmons disclaims beneficial ownership with regard to such Shares. As of the close of business on December 22, 2000, CIC beneficially owned 97,800 Shares of Common Stock, constituting approximately 1.8% of the Shares outstanding. Mr. DeRobbio may be deemed to beneficially own 97,800 Shares, representing approximately 1.8% of the Shares outstanding. Mr. DeRobbio has sole voting and dispositive power with respect to the 97,800 Shares owned by CIC by virtue of his position with CIC. All of such Shares were acquired in open-market transactions, except for the 25,000 Shares contributed to CIC by one of its limited partners. Item 7 is amended to add the following exhibit: 2. Letter from CIC Equity Partners, Ltd. and Newcastle Partners, L.P. to Issuer dated December 22, 2000. - ------------------------------- ---------------------------------- CUSIP No. 368483103 13D Page 10 of 13 Pages - ------------------------------- ---------------------------------- SIGNATURES After reasonable inquiry and to the best of his knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct. Dated: December 22, 2000 NEWCASTLE FOCUS FUND II, L.P. By: NEWCASTLE CAPITAL MANAGEMENT, L.P. By: NEWCASTLE CAPITAL GROUP, L.L.C., its General Partner By: /s/ Mark E. Schwarz ------------------------------------ Name: Mark E. Schwarz Title: Managing Member NEWCASTLE PARTNERS, L.P. By: /s/ Mark E. Schwarz ---------------------------------- Name: Mark E. Schwarz Title: General Partner /s/ Mark E. Schwarz --------------------------------------------- MARK E. SCHWARZ CIC EQUITY PARTNERS, LTD. By: SLP Consultants, Inc., its General Partner By: /s/ Paul DeRobbio --------------------------------- Name: Paul DeRobbio Title: President /s/ Paul DeRobbio --------------------------------------------- PAUL DEROBBIO /s/ Harold C. Simmons ---------------------------------------------- HAROLD C. SIMMONS - ------------------------------- ---------------------------------- CUSIP No. 368483103 13D Page 11 of 13 Pages - ------------------------------- ---------------------------------- EXHIBIT INDEX Exhibit Page - ------- ---- 1. Joint Filing Agreement (previously filed). 2. Letter from CIC Equity Partners, Ltd. 12-13 and Newcastle Partners, L.P. to Issuer dated December 22, 2000. - ------------------------------- ---------------------------------- CUSIP No. 368483103 13D Page 12 of 13 Pages - ------------------------------- ---------------------------------- NEWCASTLE PARTNERS, L.P. CIC EQUITY PARTNERS, LTD. 4514 Cole Avenue, Suite 600 Three Lincoln Centre Dallas, Texas 75205 5430 LBJ Freeway, Suite 1700 Dallas, Texas 75240 December 22, 2000 Mr. William D. Gehl Chairman of the Board Gehl Company 143 Water Street West Bend, WI 53095 Dear Mr. Gehl: Newcastle Partners, L.P. and CIC Equity Partners, Ltd. (collectively, the "Interested Parties") currently own an aggregate of 192,000 shares of common stock (the "Common Stock") of Gehl Company (the "Company"), representing approximately 3.6% of the issued and outstanding Common Stock. The Interested Parties and certain other persons are parties to a certain Schedule 13D filed with the Securities and Exchange Commission on November 8, 2000. Together with shares under common control with Newcastle Partners, L.P., the Interested Parties currently control approximately 6.4% of the issued and outstanding Common Stock. The Interested Parties continue to believe that there is significant value inherent in the business and assets of the Company despite the Board's failure to take any actions to attempt to maximize stockholder value. Because the Interested Parties believe that the equity markets continue to not fully appreciate the value of the Company's Common Stock and that the trading levels for the Common Stock will not improve significantly in the near future, the Interested Parties believe that it is imperative that the Board aggressively pursue strategic alternatives. To date, the Board has not pursued such alternatives. Accordingly, the Interested Parties hereby set forth their willingness to offer to acquire the Company, through an appropriate acquisition entity to be formed, for $18.00 per share in cash. As you recognize, this offer represents a 67% premium to the Company's current market price of $10.75. We believe that our - ------------------------------- ---------------------------------- CUSIP No. 368483103 13D Page 13 of 13 Pages - ------------------------------- ---------------------------------- proposal presents the Company's stockholders with the immediate opportunity to maximize their investment in the Company. As you know, the Company's market value is severely impacted by any significant volume and therefore the Company's Common Stock has provided limited liquidity to its stockholders. This all-cash offer will provide immediate liquidity to all the Company's stockholders and a significant premium to the current market price. This offer is conditioned on satisfactory completion of due diligence, obtaining all necessary financing, obtaining all necessary consents and approvals, including board and stockholder approval, amendment of the shareholder rights plan, waiver of any anti-takeover provisions and certain other customary conditions, including no material adverse change in the Company's business and confirmation that there are appropriate reserves for all contingent liabilities. We are prepared to enter into a confidentiality and exclusivity agreement and commence work immediately in order to satisfy the due diligence and financing contingencies. We are highly confident that the necessary financing can be arranged on an expeditious basis and no later than the execution of a definitive agreement. As stockholders, we feel that the Board has a responsibility to us and all its stockholders to consider fully and impartially any proposal that may significantly increase stockholder value. Accordingly, we continue to stand ready to discuss with you, the Board and members of management any aspect of our proposal so that you will share our confidence and enthusiasm for this transaction - a transaction that we believe serves the best interests of the Company, its stockholders, management, employees and the broader interested community. Please contact Mark Schwarz at (214) 559-7145 or Paul DeRobbio at (972) 450-4227 to discuss any questions you or the Board might have or if you would like further information. Very truly yours, Newcastle Partners, L.P. CIC Equity Partners, Ltd. By: /s/ Mark E. Schwarz By: /s/ Paul DeRobbio ------------------- ----------------- Mark E. Schwarz Paul DeRobbio General Partner Managing Director -----END PRIVACY-ENHANCED MESSAGE-----