-----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, URcEUrY8HpM292hwJ/EA/cOB0m30FJBA3E9B4jEcXofMtNlN8M7PH0YA01HeTLGI KvyNK+70+yB7itSqdVdhrQ== 0000930413-01-000079.txt : 20010123 0000930413-01-000079.hdr.sgml : 20010123 ACCESSION NUMBER: 0000930413-01-000079 CONFORMED SUBMISSION TYPE: SC TO-I PUBLIC DOCUMENT COUNT: 9 FILED AS OF DATE: 20010116 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: SONOMAWEST HOLDINGS INC CENTRAL INDEX KEY: 0000102588 STANDARD INDUSTRIAL CLASSIFICATION: CANNED, FROZEN & PRESERVED FRUIT, VEG & FOOD SPECIALTIES [2030] IRS NUMBER: 941069729 STATE OF INCORPORATION: CA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: SC TO-I SEC ACT: SEC FILE NUMBER: 005-34214 FILM NUMBER: 1509731 BUSINESS ADDRESS: STREET 1: 1448 INDUSTRIAL AVE CITY: SEBASTOPOL STATE: CA ZIP: 95472-4848 BUSINESS PHONE: 7078242548 MAIL ADDRESS: STREET 1: 1448 INDUSTRIAL AVE CITY: SEBASTOPOL STATE: CA ZIP: 95472 FORMER COMPANY: FORMER CONFORMED NAME: VACU DRY CO DATE OF NAME CHANGE: 19920703 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: SONOMAWEST HOLDINGS INC CENTRAL INDEX KEY: 0000102588 STANDARD INDUSTRIAL CLASSIFICATION: CANNED, FROZEN & PRESERVED FRUIT, VEG & FOOD SPECIALTIES [2030] IRS NUMBER: 941069729 STATE OF INCORPORATION: CA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: SC TO-I BUSINESS ADDRESS: STREET 1: 1448 INDUSTRIAL AVE CITY: SEBASTOPOL STATE: CA ZIP: 95472-4848 BUSINESS PHONE: 7078242548 MAIL ADDRESS: STREET 1: 1448 INDUSTRIAL AVE CITY: SEBASTOPOL STATE: CA ZIP: 95472 FORMER COMPANY: FORMER CONFORMED NAME: VACU DRY CO DATE OF NAME CHANGE: 19920703 SC TO-I 1 0001.txt TENDER OFFER STATEMENT BY ISSUER SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 --------------------------------------- SCHEDULE TO TENDER OFFER STATEMENT UNDER SECTION 14(d)(1) OR 13(e)(1) OF THE SECURITIES EXCHANGE ACT OF 1934 SONOMAWEST HOLDINGS, INC. (Name of Subject Company--Issuer) SonomaWest Holdings, Inc. (Name of Filing Person--Issuer) COMMON STOCK, NO PAR VALUE PER SHARE (Title of Class of Securities) 83567109 (CUSIP Number of Class of Securities) Gary L. Hess SonomaWest Holdings, Inc. 1448 Industrial Avenue Sebastopol, California 95472 (707) 824-2548 (Name, address and telephone number of persons authorized to receive notices and communications on behalf of filing persons) Copy to: Roger S. Mertz, Esq. Allen Matkins Leck Gamble & Mallory LLP 333 Bush Street, Seventeenth Floor San Francisco, California 94104-2806 (415) 837-1515 CALCULATION OF FILING FEE -------------------------------------------------- Transaction valuation* Amount of filing fee ---------------------- -------------------- $3,000,000 $600.00 * Estimated for purposes of calculating the amount of the filing fee only. The amount assumes the purchase of 375,000 shares of the SonomaWest Holdings, Inc.'s common stock, at $8.00 per share, in accordance with terms of the Offer described herein. The amount of the filing fee was calculated in accordance with Rule 0-11(d) under the Securities Exchange Act of 1934. ---------------------- [ ] 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: Form or Registration No.: Filing Party: Date Filed: [ ] 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. [X] 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: [ ] INTRODUCTORY STATEMENT This Tender Offer Statement on Schedule TO (this "Statement") relates to a tender offer by SonomaWest Holdings, Inc., a California corporation (the "Company"), to purchase up to 375,000 shares (or such lesser number of shares that are properly tendered) of its common stock (the "Shares") tendered pursuant to the tender offer at a purchase price of $8.00 per Share, net to the seller in cash, without interest, upon the terms and subject to the conditions set forth in the Offer to Purchase dated January 8, 2001 (the "Offer to Purchase") and in the related Letter of Transmittal, copies of which are attached hereto as Exhibits (A)(1) and (A)(2) (which together with any amendments or supplements thereto, collectively constitute the "Offer"). The term "Share" means a share of the Shares. This Tender Offer Statement on Schedule TO is intended to satisfy the reporting requirements of Section 13(e) of the Securities Exchange Act of 1934, as amended. The information in the Offer to Purchase, including all schedules and annexes thereto, is hereby expressly incorporated herein by reference in response to all the Items of this Statement, except as otherwise set forth below. ITEM 1. SUMMARY TERM SHEET. The information set forth in the Offer to Purchase under the caption "Summary Term Sheet" is incorporated herein by reference. ITEM 2. SUBJECT COMPANY INFORMATION. (a) NAME AND ADDRESS. The name of the Company is SonomaWest Holdings, Inc., which is the issuer of the common stock, no par value, subject to this Offer. The Company's principal executive offices are located at 1448 Industrial Avenue, Sebastopol, California 95472. The telephone number for the Company is (707) 824-2548. Reference is made to the information set forth in the Offer to Purchase under the caption "THE OFFER - 8. Certain Information Concerning the Company," which information is incorporated herein by reference. (b) SECURITIES. The securities which are the subject of this Offer are the common stock of the Company. As of December 31, 2000, 1,522,350 shares of the Company's common stock were issued and outstanding. Reference is made to the information set forth on the cover page of the Offer to Purchase and in the Offer to Purchase under the caption "INTRODUCTION," which information is incorporated herein by reference. (c) TRADING MARKET AND PRICE. The Shares are traded on the NASDAQ National Market System under the symbol "SWHI." Reference is made to the information set forth in the Offer to Purchase under the captions "SPECIAL FACTORS - 2. Purpose of the Offer; Certain Effects of the Offer; Plans of the Company After the Offer" and "THE OFFER - 6. Price Range of the Shares; Dividends," which information is incorporated herein by reference. ITEM 3. IDENTITY AND BACKGROUND OF FILING PERSON. This is an issuer tender offer and the Company is the only filing person. The information set forth in the Offer to Purchase under the caption "THE OFFER - 8. Certain Information Concerning the Company" is incorporated herein by reference. ITEM 4. TERMS OF THE TRANSACTION. The information set forth in the Offer to Purchase under the captions "INTRODUCTION," "SPECIAL FACTORS - 2. Purpose of the Offer; Certain Effects of the Offer; Plans of the Company After the Offer," "SPECIAL FACTORS - 6. Beneficial Ownership of Stock," "SPECIAL FACTORS - 4. Material Federal Income Tax Consequences," "THE OFFER - 1. Terms of the Offer," "THE OFFER - 2. Acceptance for Payment and Payment," "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares," "THE OFFER - 4. Withdrawal Rights," "THE OFFER - - 9. Conditions to the Offer," and "THE OFFER - 10. Legal Matters" is incorporated herein by reference. -1- ITEM 5. PAST CONTACTS, TRANSACTIONS, NEGOTIATIONS AND AGREEMENTS. None. ITEM 6. PURPOSES OF THE TRANSACTION AND PLANS OR PROPOSALS. (a) PURPOSES. The information set forth in the Offer to Purchase under the captions "INTRODUCTION" and "SPECIAL FACTORS - 2. Purpose of the Offer; Certain Effects of the Offer; Plans of the Company After the Offer" is incorporated herein by reference. (b) USE OF SECURITIES. The information set forth in the Offer to Purchase under the caption "SPECIAL FACTORS - 2. Purpose of the Offer; Certain Effects of the Offer; Plans of the Company After the Offer" is incorporated herein by reference. (c) PLANS. The information set forth in the Offer to Purchase under the captions "SPECIAL FACTORS - 1. Background and "SPECIAL FACTORS - 2. Purpose of the Offer; Certain Effects of the Offer; Plans of the Company After 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 Purchase under the caption "SPECIAL FACTORS - 5. Financing of the Offer" is incorporated herein by reference. (b) and (d) Not applicable. ITEM 8. INTEREST IN SECURITIES OF THE SUBJECT COMPANY. (a)and(b) The information set forth in the Offer to Purchase under the captions "SPECIAL FACTORS - 6. Beneficial Ownership of the Shares," "SPECIAL FACTORS-7. Transactions and Arrangements Concerning Shares" and "THE OFFER-6. Certain Information Concerning the Company" is incorporated herein by reference. ITEM 9. PERSONS/ASSETS RETAINED, EMPLOYED, COMPENSATED OR USED. (a) The information set forth in the Offer to Purchase under the caption "THE OFFER - 11. Fees and Expenses" is incorporated herein by reference. (b) Not Applicable. ITEM 10. FINANCIAL STATEMENTS. The financial statements contained in the Company's Annual Report on Form 10-K filed with the Commission on September 25, 2000, and the Company's Quarterly Report on Form 10-Q filed with the Commission on November 13, 2000, are incorporated herein by reference. ITEM 11. ADDITIONAL INFORMATION. (a) AGREEMENTS, REGULATORY REQUIREMENTS AND LEGAL PROCEEDINGS. (1) None other than previously disclosed. (2)(3) The information set forth in the Offer to Purchase under the caption "THE OFFER - 10. Legal Matters" is incorporated herein by reference. -2- (4) Not applicable. (5) None other than previously disclosed. (b) OTHER MATERIAL INFORMATION. The information set forth in the Offer to Purchase and the Letter of Transmittal, copies of which are attached hereto as Exhibits (A)(1) and (A)(2) is incorporated herein by reference. ITEM 12. EXHIBITS. (A)(1) Offer to Purchase dated January 8, 2001. (A)(2) Form of Letter of Transmittal for Common Stock. (A)(3) Form of Notice of Guaranteed Delivery. (A)(4) Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. (A)(5) Form of Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. (A)(6) Letter to Shareholders of the Company. (A)(7) Guidelines for Certification of Taxpayer Identification Number of Substitute Form W-9. (A)(8) Text of Press Release issued by the Company, dated January 8, 2001. ITEM 13. INFORMATION REQUIRED BY SCHEDULE 13E-3. Because there is a reasonable likelihood that the tender offer for the Shares may cause the Shares to be held of record by fewer than 300 persons after the closing of the offer, this transaction constitutes a "going-private" transaction. As such, the following sets forth that information required by Schedule 13E-3 that has not already been set forth in Items 1-12 above. The information set forth in the Offer to Purchase is incorporated herein by reference to the items required by Schedule 13E-3. ITEM 2 OF SCHEDULE 13E-3. (d) The information set forth in the Offer to Purchase under the caption "THE OFFER - 6. Price Range of the Shares; Dividends" is incorporated herein by reference. (e) Not applicable. (f) The Company has repurchased shares from certain stockholders. See "SPECIAL FACTORS - 7. Transactions and Arrangements Concerning Shares." ITEM 4 OF SCHEDULE 13E-3. (c) - (e) Not applicable. (f) The information set forth in the Offer to Purchase under the caption "Purpose of the Offer; Certain Effects of the Offer; Plans of the Company After the Offer" is incorporated herein by reference. -3- ITEM 5 OF SCHEDULE 13E-3. (a)-(c ) The information set forth in the Offer to Purchase under the caption "SPECIAL FACTORS-2. Purpose of the Offer; Certain Effects of the Offer; Plans of the Company After the Offer" is incorporated herein by reference. A member of the Company's Board is a member of the law firm that serves as the Company's general counsel. During fiscal 2000 and 1999, the Company incurred $196,663 and $209,697, respectively, for legal services from this firm and from another firm of which the director was a member prior to October 16, 1999. ITEM 7 OF SCHEDULE 13E-3. (a) PURPOSES. The information set forth in the Offer to Purchase under the captions "INTRODUCTION" and "SPECIAL FACTORS-2. Purpose of the Offer; Certain Effects of the Offer; Plans of the Company After the Offer" is incorporated herein by reference. (b) ALTERNATIVES. The information set forth in the Offer to Purchase under the captions "INTRODUCTION" and "SPECIAL FACTORS-2. Purpose of the Offer; Certain Effects of the Offer; Plans of the Company After the Offer" is incorporated herein by reference. (c) REASONS. The information set forth in the Offer to Purchase under the captions "INTRODUCTION" and "SPECIAL FACTORS-2. Purpose of the Offer; Certain Effects of the Offer; Plans of the Company After the Offer" is incorporated herein by reference. (d) EFFECTS. The information set forth in the Offer to Purchase under the captions "SPECIAL FACTORS-4. Material Federal Income Tax Consequences" and "SPECIAL FACTORS-2. Purpose of the Offer; Certain Effects of the Offer; Plans of the Company After the Offer" is incorporated herein by reference. ITEM 8 OF SCHEDULE 13E-3. (a) and (b) The information set forth in the Offer to Purchase under the captions "SPECIAL FACTORS-2. Purpose of the Offer; Certain Effects of the Offer; Plans of the Company After the Offer" is incorporated herein by reference. (c) APPROVAL OF SECURITY HOLDERS. Not applicable. (d) UNAFFILIATED REPRESENTATIVE. Not applicable. (e) APPROVAL OF DIRECTORS. This transaction has been approved by a unanimous vote of the Company's directors. No directors abstained from voting. (f) OTHER OFFERS. Not applicable. ITEM 9 OF SCHEDULE 13E-3. (a) REPORT, OPINION OR APPRAISAL. The Company has not received any report, opinion or appraisal from an outside party that is materially related to the Rule 13e-3 transaction. The information set forth in the Offer to Purchase under the caption "SPECIAL FACTORS" is incorporated herein by reference. (b) PREPARER AND SUMMARY OF THE REPORT, OPINION OR APPRAISAL. Not applicable. (c) AVAILABILITY OF DOCUMENTS. Not applicable. -4- ITEM 10 OF SCHEDULE 13E-3. (b) EXPENSES. The Information contained in the Offer to Purchase under the caption "THE OFFER - 11. Fees and Expenses" is incorporated herein by reference. ITEM 12 OF SCHEDULE 13E-3. (d) The Company, upon inquiry, believes Roger S. Mertz, a director, intends to tender 6,000 shares which are owned by a trust of which Mr. Mertz is the Trustee but has no beneficial interest. The Company also believes that certain relatives of directors intend to tender an aggregate of 34,750 shares. The officers and directors of the Company reserve the right to tender some or all of their shares pursuant to the Tender Offer. (e) None of the directors are making any recommendations. ITEM 14 OF SCHEDULE 13E-3. Directors, officers and regular employees of the Company (who will not be specifically compensated for such services), may contact stockholders by mail, telephone, telex, telegram messages, mailgram messages, datagram messages and personal interviews regarding the Offer and may request brokers, dealers and other nominees to forward the Purchase Offer and related materials to beneficial owners of Shares. ITEM 16 OF SCHEDULE 13E-3. No reports were prepared. SIGNATURE After due inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. Dated: January 8, 2001 SONOMAWEST HOLDINGS, INC. /s/ Gary L. Hess ---------------------------- By: Gary L. Hess Title: President -5- EXHIBIT INDEX (A)(1) Offer to Purchase dated January 8, 2001. (A)(2) Form of Letter of Transmittal for Common Stock. (A)(3) Form of Notice of Guaranteed Delivery. (A)(4) Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. (A)(5) Form of Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. (A)(6) Letter to Shareholders of the Company. (A)(7) Guidelines for Certification of Taxpayer Identification Number of Substitute Form W-9. (A)(8) Text of Press Release issued by the Company, dated January 8, 2001. EX-99.A1 2 0002.txt OFFER TO PURCHASE EXHIBIT(A)(1) SONOMAWEST HOLDINGS, INC. 1448 Industrial Avenue o Sebastopol, CA 95472-4848 Ph: 707 824-2548 o Fax: 707 824-2545 -------------------------- OFFER TO PURCHASE FOR CASH UP TO 375,000 SHARES OF ITS COMMON STOCK AT $8.00 NET PER SHARE ------------------------------- THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., PACIFIC TIME, ON THURSDAY, FEBRUARY 15, 2001, UNLESS THE OFFER IS EXTENDED AS PROVIDED HEREIN. ------------------------------- SonomaWest Holdings, Inc., a California corporation (the "Company"), is offering to purchase up to 375,000 shares of its common stock, no par value (the "Shares"), at $8.00 per Share, net to the seller in cash (the "Purchase Price"), upon the terms and subject to the conditions set forth here and in the related Letter of Transmittal (which together constitute the "Offer"). A summary of the principal terms of the Offer appears on pages one through three of this Offer to Purchase. You should read this entire document carefully before deciding whether to tender your shares. ------------------------------- THIS OFFER IS NOT CONDITIONED UPON ANY MINIMUM NUMBER OF SHARES BEING TENDERED. THIS OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE "THE OFFER - SECTION 9. CONDITIONS TO THE OFFER." NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THIS TRANSACTION, PASSED UPON THE FAIRNESS OR MERITS OF THIS TRANSACTION, OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE DISCLOSURE CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. OUR BOARD OF DIRECTORS HAS APPROVED THE OFFER. HOWEVER, NEITHER THE COMPANY NOR ANY OF ITS DIRECTORS OR EXECUTIVE OFFICERS MAKES ANY RECOMMENDATION TO YOU AS TO WHETHER TO TENDER ALL OR ANY SHARES. YOU MUST MAKE YOUR OWN DECISION AS TO WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER. ------------------------------- The Shares are currently listed and traded on the NASDAQ National Market System under the symbol "SWHI." On January 5, 2001, the last full trading day before announcement of the Offer, the last reported sale price of the Shares was $7.00 per Share. You may obtain additional copies of this Offer to Purchase, the Letter of Transmittal and other tender offer materials from us at our expense. You may direct questions and requests for assistance to us at our address and telephone number set forth above. You may also contact your local broker, dealer, bank, trust company or other nominee for assistance concerning the Offer. ------------------------------- TABLE OF CONTENTS SUMMARY TERM SHEET .............................................................................................1 FORWARD LOOKING STATEMENTS......................................................................................4 IMPORTANT.......................................................................................................4 INTRODUCTION....................................................................................................4 SPECIAL FACTORS.................................................................................................5 1. BACKGROUND....................................................................................5 2. PURPOSE OF THE OFFER; CERTAIN EFFECTS OF THE OFFER; PLANS OF THE COMPANY AFTER THE OFFER.........................................................................................6 3. FAIRNESS......................................................................................7 4. MATERIAL FEDERAL INCOME TAX CONSEQUENCES.....................................................11 5. FINANCING OF THE OFFER.......................................................................13 6. BENEFICIAL OWNERSHIP OF THE STOCK............................................................13 7. TRANSACTIONS AND ARRANGEMENTS CONCERNING SHARES..............................................14 THE OFFER......................................................................................................15 1. TERMS OF THE OFFER...........................................................................15 2. ACCEPTANCE FOR PAYMENT AND PAYMENT...........................................................16 3. PROCEDURES FOR ACCEPTING THE OFFER AND TENDERING SHARES......................................17 4. WITHDRAWAL RIGHTS............................................................................19 5. OVERSUBSCRIPTION.............................................................................19 6. PRICE RANGE OF THE SHARES; DIVIDENDS.........................................................20 7. POSSIBLE EFFECTS OF THE OFFER ON THE MARKET FOR THE SHARES AND EXCHANGE ACT REGISTRATION.................................................................................21 8. CERTAIN INFORMATION CONCERNING THE COMPANY...................................................21 9. CONDITIONS TO THE OFFER......................................................................23 10. LEGAL MATTERS................................................................................24 11. FEES AND EXPENSES............................................................................24 12. MISCELLANEOUS................................................................................24
SUMMARY TERM SHEET The following are some of the questions you, as a stockholder of the Company, may have and answers to those questions. We urge you to read carefully the entire Offer to Purchase because the information in this summary is not complete. Additional important information is contained in the remainder of this Offer to Purchase and the accompanying Letter of Transmittal. WHO IS OFFERING TO BUY MY SHARES? The Company is making an offer to buy your shares of Company common stock. See "THE OFFER - 1. Terms of the Offer". WHAT ARE THE CLASSES AND AMOUNTS OF SECURITIES SOUGHT IN THE OFFER? We are offering to buy up to 375,000 shares of our common stock, or any lesser number of shares that stockholders properly tender in the Offer. See "THE OFFER - 1. Terms of the Offer". WHAT IS THE PURPOSE OF THE OFFER? The purpose for the Offer is to allow those stockholders desiring to receive cash for all or a portion of their Shares at the present time an opportunity to do so at a premium over the recent trading prices for the Shares and without paying the usual transaction fees. HOW MUCH ARE YOU OFFERING TO PAY? WHAT IS THE FORM OF PAYMENT? WILL I HAVE TO PAY ANY FEES OR COMMISSIONS? The Company is offering to pay $8.00 per share for the common stock, net to you in cash, without interest. We will pay for shares purchased in our Offer as soon as practicable after the expiration of the Offer period. Under no circumstances will we pay interest on the purchase price, even if payment is delayed. If you are the record owner of your Shares and you tender your Shares to the Company in the Offer, you will not have to pay brokerage fees or commissions. 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 with your broker or nominee to determine whether any charges will apply. You may also have to pay stock transfer taxes in certain circumstances. See "INTRODUCTION" and "THE OFFER - 2. Acceptance for Payment and Payment." WHAT IS THE MARKET VALUE OF THE SHARES? The common stock is traded on the NASDAQ National Market System under the symbol "SWHI." See "THE OFFER - 6. Price Range of the Shares; Dividends" for the price ranges of sales of the Company's common stock. On January 5, 2000, the last reported sales price for the common stock of the Company was $7.00 per share. See "SPECIAL FACTORS - 2. Purpose of the Offer; Certain Effects of the Offer" and "THE OFFER - 6. Price Range of the Shares; Dividends." DO YOU HAVE THE FINANCIAL RESOURCES TO MAKE PAYMENT? The Company will need approximately $3.05 million dollars to purchase all of the Shares subject to this Offer and to pay all the expenses of the Offer. The Company intends to pay the Purchase Price and related expenses using cash and other liquid assets owned by the Company. See "SPECIAL FACTORS - 5. Financing of the Offer." WHAT HAPPENS IF MORE THAN 375,000 SHARES ARE TENDERED IN THIS OFFER? In the event of an over-subscription of the Offer, the Company will first purchase Shares validly tendered from holders who own an aggregate of fewer than 100 Shares, and then the balance of the Shares tendered will be subject to proration. See "THE OFFER - 5. Oversubscription." -1- IS YOUR FINANCIAL CONDITION RELEVANT TO MY DECISION WHETHER TO TENDER IN THE OFFER? Because tendering your shares in the Offer may end your ownership interest in the Company, the Company believes that the financial condition of the Company is relevant to your determination of whether the Offer Price is fair and whether you should tender in the Offer. The financial statements for the Company are included in the reports the Company has filed with the Securities and Exchange Commission. You can obtain copies of these reports in the manner described in "THE OFFER - 8. Certain Information Concerning the Company." HOW LONG DO I HAVE TO DECIDE WHETHER TO TENDER IN THE OFFER? You may tender your shares anytime prior to the expiration of the Offer. The Offer will expire at 5:00 p.m., Pacific Time, on February 15, 2001, if the offering period is not extended. See "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares." CAN THE OFFER BE EXTENDED, AND UNDER WHAT CIRCUMSTANCES? Yes. The Company has the right to extend the Offer deadline at any time by giving written notice to Continental Stock Transfer & Trust Company, the Depositary for the Offer. See "THE OFFER - 1. Terms of the Offer." HOW WILL I BE NOTIFIED IF THE OFFER IS EXTENDED? The Company can extend the offering period in its sole discretion. If the Company decides to extend the offering period, it will publicly announce the extension before 5:00 p.m., Pacific Time, on the next business day after the previously scheduled expiration date. See "THE OFFER - 1. Terms of the Offer." WHAT WILL HAPPEN TO SHARES NOT TENDERED IN THE OFFER? Shares not tendered in the Offer will remain outstanding. However, the trading market for any shares not tendered may be even more limited than the current trading market. See "SPECIAL FACTORS - 2.B. Certain Effects of the Offer." IS THE COMPANY MAKING ANY RECOMMENDATION ABOUT THE OFFER? No. The Company expresses no opinion and remains neutral with respect to whether stockholders should tender shares in response to the Offer. Stockholders should determine whether or not to accept the Offer based upon their own assessment of current market value, liquidity needs and investment objectives. See "SPECIAL FACTORS - 3. Fairness." WHAT ARE THE MOST SIGNIFICANT CONDITIONS TO THE OFFER? The Company is not required to complete the Offer unless the conditions to the Offer are met. The most significant conditions are: the absence of governmental or court action prohibiting the Offer; the absence of any third party proposals regarding a tender or exchange offer, merger, business combination or other similar transaction involving us; no material change in our business condition (financial or otherwise), assets, income, operations, prospects or stock ownership. Other important conditions to the Offer are described in "THE OFFER - 9. Conditions to the Offer." Any of these conditions may be waived by the Company. HOW DO I TENDER MY SHARES? To tender your shares, you must do one of the following: (1) If you are a record holder (i.e., a stock certificate has been issued to you), you must complete and sign the applicable enclosed Letter of Transmittal and send it with your stock certificate to Continental Stock Transfer & Trust Company, or follow the procedures described in this Offer to Purchase for book-entry transfer in "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares." These materials must reach Continental Stock Transfer & Trust Company before the Offer expires. Detailed instructions are contained in the Letter of Transmittal and in "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares." -2- (2) If you are a record holder, but your stock certificate is not available, or you cannot deliver it to Continental Stock Transfer & Trust Company before the Offer expires, you may be able to tender your shares using the enclosed Notice of Guaranteed Delivery. Please call Continental Stock Transfer & Trust Company for assistance. (3) If you hold your shares through a broker, bank or other nominee, you should contact your nominee and instruct them to tender your shares. See "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares." UNTIL WHAT TIME CAN I WITHDRAW PREVIOUSLY TENDERED SHARES? You can withdraw previously tendered shares until 5:00 p.m., Pacific Time, February 15, 2001, unless the Offer is extended. If the Offer is extended, you may withdraw previously tendered shares until the end of the extension period. See "THE OFFER - 4. Withdrawal Rights." HOW DO I WITHDRAW PREVIOUSLY TENDERED SHARES? You can withdraw previously tendered shares by instructing Continental Stock Transfer & Trust Company. If you tendered your shares by giving instructions to a broker or bank, you must instruct the broker or bank to arrange for a withdrawal of your shares. See "THE OFFER - 4. Withdrawal Rights." TO WHOM CAN I TALK IF I HAVE QUESTIONS ABOUT THE TENDER OFFER? You can call Gary L. Hess, President and CEO of the Company, at (707) 824-2548. -3- FORWARD LOOKING STATEMENTS Certain statements contained in, or incorporated by reference into, this Offer may be considered forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These forward looking statements are based largely on the expectations of the Company and are subject to a number of risks and uncertainties, many of which are beyond the control of the Company. Actual results could differ materially from these forward looking statements as a result of certain factors, including but not limited to those described in the Annual Report on Form 10-K of the Company for the fiscal year ended June 30, 2000, which is incorporated herein by reference. IMPORTANT Any stockholder who would like to tender all or any portion of his or her shares of common stock of SonomaWest Holdings, Inc. should either: (i) complete and sign the Letter of Transmittal (or a facsimile thereof) in accordance with the instructions in the Letter of Transmittal, mail or deliver it (or such facsimile) and any other required documents to the Depositary, and either deliver the certificates for such common stock and any other required documents to the Depositary or tender such common stock pursuant to the procedure for book entry transfer set forth in "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares;" or (ii) request his or her broker, dealer, commercial bank, trust company or other nominee to effect the transaction for him or her. Stockholders having common stock registered in the name of a broker, dealer, commercial bank, trust company or other nominee must contact the broker, dealer, commercial bank, trust company or other nominee if they desire to tender their shares. A Stockholder who desires to tender shares and whose certificates for the common stock to be tendered are not immediately available, or who cannot deliver the certificates for such common stock and all other required documents to the Depositary on or prior to the expiration date, or who cannot comply with the procedure for book entry transfer on a timely basis, may tender his or her Shares by following the procedures for guaranteed delivery set forth in "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares." INTRODUCTION SonomaWest Holdings, Inc., a California corporation (the "Company"), hereby offers to purchase up to 375,000 shares (or such lesser number of shares that are properly tendered) of its common stock, no par value (the "Shares"), at a purchase price of $8.00 per Share, net to the selling stockholder in cash, without interest thereon (the "Purchase Price"), on the terms and subject to the conditions set forth in this Offer to Purchase and in the Letter of Transmittal (which, as amended or supplemented from time to time, together constitute the "Offer"). If you are the record owner of your Shares and you tender your Shares to the Company in the Offer, you will not have to pay brokerage fees or commissions. 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 with your broker or nominee to determine whether any charges will apply. Except as described in Instruction 6 of the Letter of Transmittal, you will not be required to pay stock transfer taxes on the purchase of the Shares in the Offer. However, if you do not complete and sign the Substitute Form W-9 that is included in the Letter of Transmittal, you may be subject to a required backup federal income tax withholding of 31% of the gross proceeds payable to you. See "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares." The Company will pay all charges and expenses of Continental Stock Transfer & Trust Company as depositary (the "Depositary") incurred in connection with the Offer. See "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares." The Offer will expire at 5:00 p.m., Pacific Time, on February 15, 2001, unless we extend it. This Offer to Purchase and the Letter of Transmittal contain important information which you should read carefully before you make any decision with respect to the Offer. -4- SPECIAL FACTORS 1. BACKGROUND The Company is currently going through a period of corporate restructuring. Since the Company acquired certain of the assets and liabilities of Made in Nature, Inc. in June 1998, the Company has operated in three business segments: industrial dried fruit ingredients, organic packaged foods and real estate. In August 1999, the decision was made to sell or discontinue all product lines in the Company's industrial dried fruit ingredients business segment. In January 2000, the Company decided to sell or discontinue its organic packaged foods business. These decisions were consistent with our previously stated objective of strategically reorienting the Company away from low-margin, seasonal, asset-intensive businesses. As a result of these decisions, both business segments are considered discontinued operations and their operating results, results of cash flows, net assets and liabilities are reflected outside of the Company's continuing operations. The Company's sole remaining line of business is its real estate management and rental operations. The Company's plan is to focus on the development and leasing of its Sonoma County, California real estate and the strategic redeployment of its capital. The Company has completed the conversion to cash of essentially all non-real estate assets with the exception of certain inventories that are still being liquidated. The Company is actively marketing all remaining assets of its discontinued businesses (primarily inventory), but there can be no assurances that there will be a sale of all or any of the remaining assets. In furtherance of the Company's intent to strategically re-deploy capital, the Company recently announced its commitment to a $3 million investment in MetroPCS, Inc., a privately-held telecommunications company, which owns 30 megahertz bandwidth PCS (Personal Communication Service) licenses covering over 21 million people in the San Francisco Bay Area and two other attractive metropolitan U.S. markets: Miami and Atlanta. The Company will be a minority, passive investor in MetroPCS behind a lead investor group that includes one or more prestigious venture capital firms with telecommunications expertise. In fiscal 2000, the Company used a portion of the $16.1 million net proceeds from its discontinued businesses to pay off borrowings under its bank line of credit and retired a significant portion of its long-term debt. In August 2000, the Company elected to prepay in full a remaining stockholder note payable (scheduled to mature in 2003), in the amount of $564,000 plus accrued interest. The cash balances decreased from $8.4 million at June 30, 2000 primarily as a result of the stockholder note payoff and payments of liabilities regarding discontinued operations. Thus, the Company had cash of $ 7.4 million at September 30, 2000, and current maturities of long-term debt of $54,000. On August 9, 2000, the Board of Directors of the Company (the "Board") began discussion of a possible distribution to the stockholders of all cash remaining after the establishment of an appropriate reserve to cover forecasted cash expenditures in connection with the Company's real estate activities and to cover the Company's investment in MetroPCS. Several alternatives were considered including a cash tender offer to stockholders. The Company also considered a stockholder proposal to declare and pay a cash dividend. -5- 2. PURPOSE OF THE OFFER; CERTAIN EFFECTS OF THE OFFER; PLANS OF THE COMPANY AFTER THE OFFER A. PURPOSE AND REASON FOR THE OFFER. The purpose and the reason for the Offer is to allow those stockholders desiring to receive cash for all or a portion of their Shares at the present time an opportunity to do so at a premium over the recent trading prices for the Shares. The Board believes that this is an appropriate time for the Offer because of the significant changes the Company is going through. While the Board continues to believe that the Shares represent an attractive investment for its continuing stockholders, the Offer presents stockholders who may wish to receive an immediate cash premium for their Shares with an opportunity to realize such premium by tendering Shares in the Offer. In addition, the Offer provides stockholders who may not concur with the new direction of the Company and are considering a sale of all or a portion of their Shares with the opportunity to sell their Shares for cash, without the usual transaction costs associated with market sales. The Board considered and evaluated the possible alternatives to the Offer, such as a cash dividend but decided to reject such alternative because it was not as tax advantaged for the stockholders and proceeding with the Offer presented the best opportunity to maximize stockholder value. B. CERTAIN EFFECTS OF THE OFFER. One possible effect of this Offer is that the Company may no longer be qualified to be listed on the NASDAQ National Market. The Common Stock is currently registered under the federal securities laws and traded on the NASDAQ National Market. One of the requirements for continued inclusion on NASDAQ is that the Company must have at least 300 round lot stockholders (those who own at least 100 shares of the common stock). As of January 2, 2001, the Company had approximately 629 round lot stockholders of the Company's common stock. It is possible that enough stockholders will tender their shares in the Offer such that the number of stockholders of the Company will fall under 300. If the Shares are delisted by NASDAQ, the Shares may only be quoted on the over-the-counter quotation system, and stockholders may find it more difficult to obtain accurate quotations for, or to dispose of, the Shares. However, because the trading market for the Shares is relatively low, the stockholders of the Shares may not really have what is considered one of the main advantages of owning shares in a public company--a liquid market for their shares. Further, while the Company currently does not plan to do so, the Company may be able to terminate its registration under the Securities Exchange Act of 1934 if the number of holders of record for the Shares after the Offer is completed is less than 300. The Common Stock is currently registered under the federal securities laws. If the Company terminates its registration with the SEC, the Shares may be subject to restrictions on transfer imposed by the federal securities laws. Terminating registration under the federal securities laws may be beneficial to the Company and the stockholders because the Company would be relieved of the burdens of being a public company such as: (i) preparing and filing with the SEC periodic reports under the Securities Exchange Act of 1934; (ii) preparing, filing with the SEC and mailing to stockholders a proxy statement in connection with the annual stockholders meeting; (iii) the annual audit of the Company's financial statements; (iv) directors' fees and expenses; and (v) directors and officers liability insurance, all of which expenses could be eliminated if the Company were no longer subject to the reporting requirements of the Securities Exchange Act of 1934. Such expenses can amount to more than $200,000 annually. Additionally, the Company will be able to reduce its annual administrative expenses in connection with servicing the accounts of a reduced number of holders of the Shares and the Company believes that its flexibility in terms of decision-making and the pursuit of future strategic alternatives will be increased, since the obligation it has as a public company to publicly report all such decisions and developments will be eliminated. However, the Company currently does not intend to terminate registration of its securities with the SEC. Even if there is no termination of registration under the federal securities laws and the Common Stock is not delisted by NASDAQ, the Company's purchase of Shares pursuant to the Offer will reduce the number of holders of Shares and the number of Shares that might otherwise trade publicly. Depending upon the number of Shares so purchased, the liquidity and market value of the remaining Shares held by the public could be adversely affected. The extent of the public market for the Shares following a consummation of the Offer will depend on the number of holders that remain at such time, the interest in maintaining a market in the Shares on the part of -6- securities firms and other factors. An issue of security with a smaller float may trade at lower prices than would a comparable issue of security with a greater float. Accordingly, the market price for Shares that are not tendered in the Offer may be adversely affected to the extent that the amount of Shares purchased pursuant to the Offer reduces the float. The reduced float also may have the effect of causing the trading prices of the Shares that are not tendered or purchased to be more volatile and causing a larger bid/ask price spread. As a result, Stockholders who determine not to accept the Offer will increase their proportionate interest in the Company, subject to the Company's right to issue additional shares and other equity securities in the future. However, such Stockholders may find it more difficult to dispose of their shares in a less liquid market. Following the expiration of the Offer, the Company may, in its sole discretion, determine to purchase any remaining Shares through privately negotiated transactions, open market purchases or otherwise, on such terms and at such prices as the Company may determine from time to time, the terms of which purchases or offers could differ from those of the Offer, except that the Company will not make any such purchases of Shares until the expiration of at least ten business days after the termination of the Offer. Any possible future purchases of Shares by the Company will depend on many factors, including the market price of the Shares, the Company's business and financial position, alternative investment opportunities available to the Company, the results of the Offer, and general economic and market conditions. In addition, any payments made to stockholders in consideration for their Shares also may be subject to challenge as a preference if such payments: (i) are made within 90 days of a bankruptcy filing by the Company (or within one year in the case of stockholders who are determined to be insiders of the Company); (ii) are made when the Company is insolvent; and (iii) permit the stockholders to receive more than they otherwise might receive in a liquidation under applicable bankruptcy laws. If such payments were deemed to be a preference, the full amount of such payments could be recovered by the Company as a debtor in possession or by the Company's trustee in bankruptcy, and the stockholder would be entitled to assert claims in respect of the Shares against the Company in its reorganization or bankruptcy case. The Company does not believe that it is currently insolvent, will be insolvent after giving effect to the Offer or will be insolvent within one year, although for purposes of the preference laws described above, the Company would be presumed insolvent for the 90 days preceding a bankruptcy or reorganization case. C. PLANS OF THE COMPANY. The Company will retire the shares acquired in the Offer. Contemporaneously with the Offer, the business and operations of the Company will be continued by the Company substantially as they are currently being conducted as described in "SPECIAL FACTORS - 1. Background." Other than the changes and plans already described in this Offer, the Company has no current plans, proposals or negotiations which relate to or would result in: (i) an extraordinary corporate transaction, such as a merger, reorganization or liquidation, involving the Company; (ii) a purchase, sale or transfer of a material amount of assets of the Company; (iii) any material change in the present dividend policy; (iv) any other material change in the Company's corporate structure or business; (v) any change in the Company's Amended and Restated Certificate of Incorporation or Amended and Restated Bylaws or any actions that may impede the acquisition of control of the Company by any person; or (vi) any acquisition of the Company's securities. 3. FAIRNESS The Board has decided to set the Purchase Price at $8.00 per Share, which is an approximate 14% premium over the most recently reported bid price for the Shares. The Board also noted that the Offer Price was -7- approximately $2.35 above current net book value (on a fully diluted basis). As such, the Offer may give holders of the Shares who are considering the sale of all or some of their Shares the opportunity to sell their Shares for a higher price than may have been available on the open market immediately prior to the announcement of the Offer and without the usual transaction costs associated with market sales. No commissions are payable to the Depositary by stockholders who tender their Shares in the Offer. The Board believes the Offer is fair to holders of the Shares and has unanimously approved the transaction. In evaluating the Offer, the Board relied upon its knowledge of the business, financial condition and prospects of the Company. In making its determination regarding the fairness of the Offer, the Board considered a number of factors, including the following: A. CURRENT BUSINESS STRATEGY AND FUTURE PROSPECTS. The Board considered information provided by Company management as to the business, financial conditions, results of operations, current business strategy and future prospects of the Company, recent trends in the market in which the Company operates, the Company's position in such market and the historical and recent market prices for the Shares. B. NET BOOK VALUE. The Board considered the net book value in evaluating the Offer. The audited financial statements for the most recently ended fiscal year (June 30, 2000) reflect total shareholders' equity of $9,235,000 which on 1,522,350 shares outstanding (non-diluted) approximately equals $6.07 per share. The comparable (unaudited) figures for the most recent fiscal quarter ended September 30, 2000 are $9,214,000 or approximately $6.05 per share. On a fully diluted basis, the above per share prices would be $5.66 per share and $5.65 per share, respectively. C. CURRENT, HISTORICAL AND COMPARATIVE MARKET PRICES. In evaluating the Offer, the Board also considered the current and historical market prices of the Company's stock and the effect announcements of the repurchase program had on such market prices. On September 7, 2000, the Company announced that its Board was considering alternative uses of any cash balance in excess of that required for making its $3 million investment in MetroPCS and support of its real estate leasing and development activities. On November 8, 2000, the Company announced that its Board had authorized a program to repurchase up to 375,000 shares of the Company's stock at $8.00 per share subject to regulatory filings and approvals and approval by the Company's bank. In the 30-day period prior to the first announcement, the Company's stock traded in a range of $5.875 per share to $6.375 per share. The last close prior to the announcement was $6.00 per share. Subsequent to the first announcement and prior to the second announcement, the Company's stock traded in a range of $5.9375 per share to $7.50 per share with a last close prior to the announcement of $7.00. In the approximately six weeks that have transpired subsequent to the second announcement, the Company's stock traded in a range of $6.9375 per share to $7.3125 per share. The last close prior to the Board's analysis of the Offer is $6.9688 per share (December 19, 2000). The $8.00 per share price of the Offer represents a 33.3% premium over the price at which the Company's stock traded prior to both announcements, which is a 14.3% premium over the price at which the Company's stock traded just prior to the second announcement and a 14.8% premium over the last closing price. Further, in the 52 weeks prior to the Board's analysis of the Offer, the Company's stock traded in a price range from $4.625 per share to $7.50 per share, trading most of the time in a range of $5.25-$6.375 per share. The $8.00 per share price of the Offer represents a 32.0% and a 37.6% premium over the averages of these two ranges, respectively, and a premium of 6.7% over the maximum price at which the Company's stock traded during the entire period. -8- In comparison to market averages, since the Company's first announcement of its intent to repurchase shares, the overall NASDAQ market average is down approximately 40%. During this same time frame, the Dow Jones Industrial average is down about 8% and the Standard and Poor's 500 index is down about 12%. Over the past 12 months the major market indexes have changed as follows: Dow Jones Industrial Average (-7.9%), Dow Jones United States Total Market (-12.4%), Standard and Poor's 500 (-11.9%), NASDAQ Composite (-40.8%) and Russell 2000 (-7.1%). D. GOING CONCERN VALUE. The Board also took into account the going concern of the Company in evaluating the Offer. Essentially, the Company's activities include leasing its real estate (largely its former production and warehousing facilities) and making passive investments with its cash (i.e., the $3 million investment in MetroPCS). While the Board believes that its MetroPCS investment has a good chance of an above average risk-adjusted return and recent FCC re-auctions of similar bandwidth were at prices which support the Board's judgment, by its very nature, this venture capital investment involves risk and could result in investment loss. With respect to the real estate, it was last appraised in 1998 when the Company was operating as a specialty drier of fruits. At that point, the appraised value of all of the Company's real estate was just over $13 million. Today, the Company's real estate consists of partially empty facilities with a range of short and longer-term tenants. The large, north facility in particular has a high vacancy rate (58%). Almost half of the occupied area is under short term leases. The Company has not been able to locate an anchor tenant for this facility in over 16 months of effort and despite a strong local real estate market. The buildings are old (one over 100 years), not constructed to meet all current building standards and inefficiently laid out. A potentially valuable aspect of the facility is the waste water processing system. However, upon shutdown, the Company's former waste water processing permit was terminated and the Company has been operating with temporary permits pending receipt of regular permits. There is no assurance that the Company will be able to obtain the necessary waste water processing permits that will be necessary to maximize the value of the facility. In addition, the Company anticipates that its permission to continue to discharge waste water into surface waters will be more difficult to obtain over time and will require substantial capital and annual expenditures. The current zoning of the facility limits the uses to which prospective tenants may make use of the property generally for agricultural processing uses. The Company is seeking a broadened use permit for the property and potentially a rezoning. If the Company is not successful in obtaining appropriate zoning or permitting for a broader use of the property, its value may be adversely affected. Currently, the Company needs additional net lease revenue of approximately $65,000 per month to achieve breakeven results on a cash basis. At the current rate of negative cash flow (assuming no new tenants ) and taking into account all budgeted liabilities (including the MetroPCS investment and the $3 million share repurchase program), the Company estimates that its cash reserves will be exhausted within two years. In such event, the Company may have to seek to borrow additional operating capital or sell its properties. If the Company were able to lease out 90% of the available space at both facilities at rates toward the high end of what the Company believes may be achievable, the Company believes that it could have annual gross revenues of $2,050,000, an increase of $877,000 from today. The Company does not believe that so long as it remains a public company even with radical, and very difficult to achieve, cuts in cost, the Company could produce more than $800,000 in annual cash flow. The Company is uncertain as to the value which would be attributed to this cash flow and the Company's investment in MetroPCS. E. LIQUIDATION VALUE. In 1998 for purposes of obtaining a loan, Wells Fargo Bank had the Company's real estate appraised. The appraised value of such real estate was just over $13 million. The Company believes that the south facility could be sold for approximately $4.2 million. Because of the shutdown, tenant status, permit and zoning issues and condition of the buildings the Company is uncertain as to the net realizable value of the north facility. If -9- the properties could be sold for their 1998 appraised values, the Company would have net proceeds after income taxes and payment of debt approximately $6.26 million. The Company currently has about $7.5 million in cash (assuming that the Company can and does revoke the remainder of its commitment to invest in MetroPCS). In addition, the Company would realize $546,854 on the exercise of the 108,074 options outstanding (all of the outstanding options have strike prices below $8.77 per share). As a result, the total liquidation value is approximately $14,306,854 ($6,260,000 in real estate plus $8,046,854) or $8.77 per share. This value does not take into account the expenses which would be incurred in connection with the liquidation of the Company following such sales. F. REPORTS, OPINIONS OR APPRAISALS. The Company has not received any report, opinion or appraisal from an outside party that is materially related to the Offer for the Shares. The Board elected not to retain an unaffiliated representative or to obtain a report, opinion or appraisal because the Board determined that the cost of retaining a representative or of obtaining a report, opinion or appraisal would not be justified given the relatively small dollar value of the transaction. G. FIRM OFFERS. Other than the transactions described in this Statement, no firm offers were made by any person in the past two years for merger, consolidation, sale or transfer of all or any substantial part of the assets of the Company, or the purchase of the Company's securities that would enable such purchaser to exercise control of the Company. H. CONTINGENT OBLIGATIONS; LITIGATION. The Board considered the potential affect of the contingent obligations of the Company with respect to the local apple growers litigation. On February 23, 2000, several local apple growers filed a complaint in the United States District Court for the Northern District of California naming the Company and Tree Top, Inc. as defendants. The complaint alleged that the July 1999 sale of the Company's apple ingredients business to Tree Top, Inc. was an unlawful combination in restraint of trade in the dried apple business under federal and California law, that the Company conspired with Tree Top, Inc. to monopolize the dried apple business, and that such acts also constituted unlawful business practices under the California Business and Professions Code. The suit sought treble damages, punitive damages, interest and attorney fees, all in unnamed amounts. On August 4, 2000, the Company's motion to dismiss the complaint was granted with leave to amend. To date there has been no amendment. The Board believes that the suit was without merit and will defend the Company vigorously should an amended complaint be filed. Although the Board believes that the Offer is fair, neither the Board nor the Company is making a recommendation as to whether holders should tender their Shares. Stockholders of the Shares should determine whether to accept the Offer based upon their own assessment of current market value of the Shares, liquidity needs and investment objectives. None of the directors of the Company have retained an unaffiliated representative to act solely on behalf of unaffiliated stockholders for the purposes of negotiating the terms of the Offer. There is no stockholder vote required in connection with the Offer. There are no appraisal rights available to holders of the Shares in connection with the Offer. -10- 4. MATERIAL FEDERAL INCOME TAX CONSEQUENCES A. GENERAL. This summary of federal income tax consequences is not intended to be a complete discussion of all possible federal income tax consequences that you may have by selling your Shares in the Offer. It is not intended as a substitute for careful tax planning. The applicability of federal income tax laws to stockholders owning the Shares will vary from one stockholder to another, depending upon each stockholder's tax situation. Accordingly, you are advised to consult with your own attorneys, accountants and other tax advisors as to the effect on your own tax situation of selling your Shares. The following discussion of the federal income tax consequences does not purport to discuss all aspects of federal, state and local tax laws which may affect you. Instead, it focuses on the federal income tax consequences of a typical stockholder. This discussion of federal income tax consequences is based upon the Internal Revenue Code of 1986, as amended (the "Code"), and upon regulations, revenue rulings, court decisions and administrative authorities governing the Code, as of the date of this Offer, and related documents and factual representations made by the Company. Many of the provisions of the Code which are discussed in this summary were added or amended by one or more of the tax acts passed by Congress from 1987 to the present, including 1999 legislation. Legislation proposed in 2000, but not signed into law or enacted, is not considered in this discussion. In many instances, the Internal Revenue Service ("IRS") has not issued regulations or rulings setting forth its interpretation of provisions discussed in this summary, or the courts have not yet ruled on relevant issues. The following discussion is subject to both the accuracy of facts and assumptions, and the continued applicability of such legislative, administrative and judicial authorities, all of which authorities are subject to change, possibly retroactively. Subsequent changes in such authorities may cause the tax consequences to vary substantially from the consequences described below, and any such change could be retroactively applied in a manner that could adversely affect the tax consequences to you of disposing of the Shares. Furthermore, in an effort to provide guidance to taxpayers as expeditiously as possible, the IRS in many cases adopts its proposed regulations in temporary form or issues announcements or notices of its position. Temporary regulations, announcements and notices may differ significantly from, or be contrary to, the interpretation ultimately adopted by the IRS or the courts. You are urged, therefore, to seek independent advice in evaluating the merits of this discussion, and specifically, evaluating those provisions of the Code which may have a material affect on your disposition of the Shares. The discussion below is directed primarily to an individual stockholder who owns the Shares and who is a United States person (as determined for federal income tax purposes). Except as specifically noted, the discussion does not address all of the federal income tax consequences that may be relevant to you in light of your particular circumstances. In particular, if you are a partnership, corporation, trust or estate, or if you are subject to special rules, such as certain financial institutions, tax exempt entities, foreign corporations, non-resident alien individuals, regulated investment companies, insurance companies, dealers in securities or traders in securities who elect to mark-to-market, or if you own Common Stock or Preferred Stock of the Company as part of a "straddle," "synthetic security," "hedge," "conversion transaction" or other integrated investment, then you should seek independent advice in evaluating the merits of this discussion and, specifically, in evaluating the provisions of the Code which may have a material effect upon your decision to dispose of Common Stock in the Company. Furthermore, the discussion deals only with Common Stock of the Company held as "capital assets" within the meaning of Section 1221 of the Code. B. SALE OR EXCHANGE TREATMENT FOR STOCKHOLDERS. Assuming that the Company redeems all of the outstanding Shares that you own in the Company such that you no longer own an interest in the Company, then you should, upon the redemption of the Shares, recognize a gain or loss for federal income tax purposes in an amount equal to the difference between the amount realized and your adjusted tax basis in the Shares redeemed. Such gain or loss should be long-term capital gain or loss if you held the Shares for more than one year. If you sell your Shares at a profit within 12 months of purchasing them, any gain would be taxed at ordinary income tax rates, but any loss upon the sale of your Shares that are held for fewer than 12 months will generally be a short-term capital loss. Net capital losses may offset no more than -11- $3,000 of ordinary income in the case of individuals and may only offset capital gain in the case of a corporation. If you are an individual, you should be able to carry over unused capital losses to later tax years until such net capital losses are exhausted. If you are a corporation, you may carry an unused capital losses back three years from the loss year and carry forward five years from the loss year to offset capital gains. If you elect to tender only a portion of your Shares in the Company, the redemption may still qualify for sale or exchange treatment. A redemption of your Shares would qualify as a sale or exchange if a three-part safe harbor is met. To satisfy the safe harbor, immediately after the purchase: (i) you must own less than 50% of the total combined voting power of all classes of stock entitled to vote; (ii) your percentage interest of voting stock in the Company after the redemption is less than 80% of your percentage interest of voting stock immediately before the redemption; and (iii) your percentage interest of all common stock of the Company (whether voting or non-voting) after the redemption is less than 80% of your percentage interest of all common stock before the redemption. If you do not qualify under the three-part safe harbor outlined above, a third provision, Code Section 302(b)(1), permits sale or exchange treatment to apply to a redemption of your Shares by the Company if the purchase is "not essentially equivalent to a dividend." In order to be "not essentially equivalent to a dividend," the redemption must result in a meaningful reduction of your proportionate interest in the Company, taking into consideration shares attributed to you under the constructive ownership rules discussed below. This is a vague standard, dependent upon the facts and circumstances of each individual situation, which does not easily lend itself to clear guidelines. If you do not qualify for sale or exchange treatment under the first two tests outlined above, you should review your situation with a tax advisor to determine whether you could contend that a purchase of your Shares by the Company is "not essentially equivalent to a dividend." Finally, if you are an individual stockholder, and not a corporation, the redemption of your shares may qualify for sales or exchange treatment if the redemption is made in partial liquidation of the Company. Application of this provision, however, is viewed from the perspective of the Company, rather than your own individual circumstances. C. ATTRIBUTION TO YOU OF SHARES OWNED BY OTHERS. For purposes of the tests set forth in Section B above, the Code treats Shares in the Company that are owned by persons or entities that are related to you as owned by you directly. In certain circumstances, the attribution rules may be waived. For instance, in determining whether your interest in the Company has completely terminated, Shares that are attributed to you from family members can be waived if you comply with certain statutory requirements. You should review these provisions carefully with a tax advisor before determining whether or not a sale or exchange of your Shares has occurred. D. DIVIDEND TREATMENT. If the redemption does not qualify for treatment as a sale or exchange, you will be treated as having received a distribution of property from the Company at the time that your Shares are redeemed. The tax impact upon you of such a distribution depends upon the applicable provisions of Code Section 301(c). A distribution is treated as a dividend to you to the extent that the Company has either earnings and profits accumulated from prior operations or earnings and profits of the tax year in which the distribution occurs. Because the Company had retained earnings of $5,874,000 as of June 20, 2000, it is possible that the IRS may characterize the distribution as a dividend. Proceeds from the distribution would then be applied against and reduce the adjusted basis that you have in the Shares being redeemed. Finally, if the distribution exceeds the adjusted basis that you have in the Shares being redeemed, you would recognize a capital gain on the excess for federal income tax purposes. -12- E. WITHHOLDING OF TAXES. Under Code Section 3406, the Company may be required to withhold 31% of the distributions (known as "backup withholding") that would otherwise be made to you for federal income tax purposes. Only in certain circumstances is the Company required to engage in backup withholding. These rules apply to stockholders who fail to furnish information to the Company or if the Company receives a notice that you have failed to include interest or dividend payments on returns that were to have been filed with the IRS. Any tax that is withheld can be claimed as a credit on your federal income tax return. You should consult with your own tax advisor as to the impact of the backup withholding rules upon your situation. These rules may apply whether the payments are treated as capital gain transactions to you or as dividend distributions to you under the discussion immediately above. F. CONCLUSION REGARDING TAX TREATMENT OF THE COMPANY AND STOCKHOLDERS. This summary of the federal income tax consequences set forth above is not intended to be a complete summary of the tax consequences to you if you tender Shares in the Offer. It is not intended as a substitute for careful tax planning. The applicability of the tax laws to stockholders will vary from one stockholder to another, depending upon each stockholder's individual tax situation. Accordingly, you are advised to consult with one of your own attorneys, accountants and other personal tax advisors as to the effect on your tax situation of the proposed purchase of your Shares. You should also be aware that the redemption of the Shares that you own in the Company will likely have income tax consequences to you under state income tax laws (including withholding obligations), depending upon the laws of the state in which you reside. You should consult your tax advisor about the income tax impact upon you of any state income taxation of the purchased Shares, if you reside in a state which imposes a state income tax. The federal income tax discussion set forth above is included for general information only. You are urged to consult your tax advisor with respect to the specific tax consequences to you of the Offer, including federal, state, local and foreign tax consequences. 5. FINANCING OF THE OFFER The total amount of funds required by the Company to purchase the Shares is expected to be approximately $3.05 million. The Company will provide the funds needed from cash currently held by the Company. 6. BENEFICIAL OWNERSHIP OF THE STOCK The following table, based in part upon information supplied by officers, directors and principal stockholders, set forth certain information known to the Company with respect to beneficial ownership of the Company's Common Stock as of September 13, 2000, by: (i) each beneficial owner of more than 5% of the Company's Common Stock; (ii) the Company's Chief Executive Officer and each of the four other most highly compensated executive officers whose aggregate compensation exceeded $100,000 for the fiscal year ended June 30, 2000, (collectively, the "Named Executive Officers"); (iii) each director of the Company; and (iv) all directors and executive officers of the Company as a group. Except as otherwise indicated, each person has sole voting and investment power with respect to all shares shown as beneficially owned, subject to community property laws where applicable. Voting power is the power to vote or direct the voting of securities, and investment power is the power to dispose of or direct the disposition of securities. -13- The table below presents the security ownership of the Company's Directors, Named Executive Officers, and all directors and executive officers as a group as of September 13, 2000.
Shares Beneficially Owned (a) ------------------------- Name of Beneficial Owner Number Percent ------------------------ ------ ------- Gary L. Hess 115,017(b) 7.1% Roger S. Mertz 55,266(c) 3.6% Fredric Selinger 7,000(d) * Craig R. Stapleton 431,716(e) 28.3% All directors and executive officers as a group (5 persons) 608,999 39.9%
-------- * Does not exceed 1% of the referenced class of securities. (a) Shares listed in this column include all shares held by the named individuals and all directors and executive officers as a group in their own names and in street name and also includes all shares allocated to the accounts of the named individuals and all directors and executive officers as a group under the Company's Employee Stock Purchase Plan. Security ownership information for beneficial owners is taken from statements filed with the Securities and Exchange Commission pursuant to Sections 13(d), 13(g) and 16(a) and information made known to the company. Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with respect to securities. Shares of common stock subject to options that are currently exercisable or exercisable within 60 days of September 13, 2000 are deemed to be outstanding for the purpose of computing the percentage ownership of the person holding those options, but are not treated as outstanding for the purpose of computing the percentage ownership of any other person. The percentage of beneficial ownership is based on 1,522,350 shares of common stock outstanding as of September 13, 2000. (b) Includes 25,543 shares owned directly and 89,474 shares issuable upon the exercise of stock options. (c) Includes 44,266 shares owned directly, 5,000 shares issuable upon the exercise of stock options, and 6,000 shares held by Mr. Mertz as trustee and to which Mr. Mertz disclaims any beneficial interest. (d) Includes 2,000 shares owned directly and 5,000 shares of issuable upon the exercise of stock options. (e) Includes 279,866 shares owned directly by Mr. Stapleton or trusts for the benefit of Mr. Stapleton, 5,000 shares issuable upon the exercise of stock options, 61,950 shares as trustee of a trust for the benefit of his children and certain other relatives and to which Mr. Stapleton disclaims any beneficial interest, and 84,900 shares owned by Mr. Stapleton's wife and children to which Mr. Stapleton disclaims any beneficial interest. The Company, upon inquiry, believes Roger S. Mertz, a director, intends to tender 6,000 shares which are owned by a trust of which Mr. Mertz is the Trustee but has no beneficial interest. The Company also believes that certain relatives of directors intend to tender an aggregate of 34,750 shares. The officers and directors of the Company reserve the right to tender some or all of their shares pursuant to the Tender Offer. 7. TRANSACTIONS AND ARRANGEMENTS CONCERNING SHARES On January 9, 1998 the Company repurchased 94,000 shares of the Company's stock from Catherine C. Boothe for $6.00 per share. On January 20, 1998 the Company repurchased 42,000 shares of its stock from Kenneth P. Gill, a former president and director of the Company, and another 3,100 shares from a trust established by Mr. Gill for his grandchildren, all at $6.00 per share. In the year prior to that, both the Company and certain members of the Board purchased shares at $5.00 per share each from a block offered to the Company by an affiliate of one of its market makers. To the Company's knowledge, no transactions in the Shares have been effected during the past 60 days by the Company or its executive officers, directors, affiliates or subsidiaries, or by executive officers, directors or affiliates of its subsidiaries. -14- THE OFFER 1. TERMS OF THE OFFER Upon the terms and subject to the conditions of the Offer, the Company will purchase up to 375,000 shares of the Company's common stock that are validly tendered by stockholders and not properly withdrawn (in accordance with "THE OFFER - 4. Withdrawal Rights") prior to the Expiration Date at $8.00 per share. The later of 5 p.m. Pacific time, on Thursday, February 15, 2001, or the latest time and date to which the Offer is extended, is referred to herein as the "Expiration Date." The Company may extend the Expiration Date for an additional period or periods of time by making public announcement and giving oral or written notice of the extension to the Depositary. During any such extension, all Shares previously tendered and not withdrawn will remain subject to the Offer and subject to your right to withdraw the Shares. See "THE OFFER - 4. Withdrawal Rights." The Offer is not conditioned on any minimum number of Shares being tendered. Subject to the applicable regulations of the SEC, the Company also reserves the right, in its sole discretion, at any time or from time to time, to: (i) terminate the Offer (whether or not any Shares have previously been purchased) if any condition referred to in "THE OFFER - 9. Conditions to the Offer" has not been satisfied; and (ii) waive any condition or otherwise amend the Offer in any respect, in each case, by giving oral or written notice of the termination, waiver or amendment to the Depositary and, other than in the case of any waiver, by making a public announcement thereof. The rights the Company reserves in the preceding paragraph are in addition to its rights described in "THE OFFER - 9. Conditions to the Offer." Any extension, termination or amendment of the Offer will be followed as promptly as practicable by a public announcement. An announcement in the case of an extension will be made no later than 5:00 p.m., Pacific Time, on the next business day after the previously scheduled Expiration Date. Without limiting the manner in which we may choose to make any public announcement, subject to applicable law (including Rules 13e-4(e), 14d-4(d) and 14d-6(c) under the Exchange Act, which require that material changes be promptly disseminated to holders of Shares), the Company will have no obligation to publish, advertise or otherwise communicate any such public announcement other than by issuing a press release. If the Company makes a material change in the terms of the Offer, or if the Company waives a material condition to the Offer, the Company will extend the Offer and disseminate additional tender offer materials to the extent required by Rules 13e-3(e), 13e-4(e), 14d-4(d), 14d-6(c) and 14e-1 under the Exchange Act. The minimum period during which a tender offer must remain open following material changes in the terms of the offer, other than a change in price or a change in percentage of securities sought, depends upon the facts and circumstances, including the materiality of the changes. In the SEC's view, an offer should remain open for a minimum of five business days from the date the material change is first published, sent or given to stockholders, and, if material changes are made with respect to information that approaches the significance of price and the percentage of securities sought, a minimum of ten business days may be required to allow for adequate dissemination and investor response. With respect to a change in price, a minimum ten-business-day period from the date of the change is generally required to allow for adequate dissemination to stockholders. Accordingly, if prior to the Expiration Date, the Company decreases the number of Shares being sought, or increases or decreases the consideration offered pursuant to the Offer, and if the Offer is scheduled to expire at any time earlier than the period ending on the tenth business day from the date that notice of the increase or decrease is first published, sent or given to holders of the Shares, the Company will extend the Offer at least until the expiration of such period of ten business days. For purposes of the Offer, a "business day" means any day other than a Saturday, Sunday or a federal holiday and consists of the time period from 12:01 a.m. through 12:00 midnight, Pacific Time. Consummation of the Offer is conditioned upon satisfaction of the conditions set forth in "THE OFFER - 9. Conditions to the Offer." The Company reserves the right (but is not obligated), in accordance with applicable rules and regulations of the SEC, to waive any or all of those conditions. If, by the Expiration Date, any or all of those conditions have not been satisfied, the Company may elect to: (i) extend the Offer and, subject to applicable withdrawal rights, retain all tendered Shares until the expiration of the Offer, as extended, subject to the terms of the Offer; or (ii) terminate the Offer and not accept for payment any Shares and return all tendered Shares to tendering stockholders. In the event that the Company waives any condition set forth in "THE OFFER - 9. Conditions to the Offer," the SEC may, if the waiver is deemed to constitute a material change to the information previously provided -15- to the stockholders, require that the Offer remain open for an additional period of time and/or that the Company disseminates information concerning such waiver. This Offer to Purchase, the Letter of Transmittal and other relevant materials will be mailed to record holders of the Shares and will be furnished to brokers, dealers, commercial banks, trust companies and similar persons whose names, or the names of whose nominees, appear on the security holder lists or, if applicable, who are listed as participants in a clearing agency's security position listing, for forwarding to beneficial owners of Shares. 2. ACCEPTANCE FOR PAYMENT AND PAYMENT Upon the terms and subject to the conditions of the Offer (including, if the Company extends or amends the Offer, the terms and conditions of the Offer as so extended or amended), the Company will purchase, by accepting for payment, and will pay for, all Shares validly tendered and not withdrawn (as permitted under "THE OFFER - 4. Withdrawal Rights") prior to the Expiration Date promptly after the Expiration Date if all of the conditions to the Offer set forth in "THE OFFER - 9. Conditions to the Offer" have been satisfied or waived on or prior to the Expiration Date. In all cases, the Company will pay for the Shares purchased in the Offer only after timely receipt by the Depositary of: (i) certificates representing the Shares ("Share Certificates") or timely confirmation (a "Book-Entry Confirmation") of the book-entry transfer of the Shares into the Depositary's account at The Depository Trust Company (the "Book-Entry Transfer Facility") pursuant to the procedures set forth in "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares;" (ii) the Letter of Transmittal (or a facsimile), properly completed and duly executed, with any required signature guarantees or an Agent's Message (as defined below) in connection with a book-entry transfer; and (iii) any other documents that the Letter of Transmittal requires. Accordingly, payment may be made to tendering Stockholders at different times. See "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares" for a description of the procedure for tendering Shares pursuant to this Offer. The term "Agent's Message" means a message, transmitted by the Book-Entry Transfer Facility to, and received by, the Depositary and forming a part of a Book-Entry Confirmation, which states that the Book-Entry Transfer Facility has received an express acknowledgment from the participant in the Book-Entry Transfer Facility tendering the Shares which are the subject of the Book-Entry Confirmation that the participant has received and agrees to be bound by the terms of the Letter of Transmittal and that we may enforce that agreement against the participant. For purposes of the Offer, the Company will be deemed to have accepted for payment, and purchased, Shares validly tendered and not withdrawn if, as and when the Company gives oral or written notice to the Depositary of acceptance of the Shares for payment pursuant to the Offer. In all cases, upon the terms and subject to the conditions of the Offer, payment for the Shares purchased pursuant to the Offer will be made by deposit of the Purchase Price for the Shares with the Depositary, which will act as agent for tendering stockholders for the purpose of receiving payment from the Company and transmitting payment to validly tendering stockholders. Under no circumstances will the Company pay interest on the Purchase Price regardless of any extension of the Offer or any delay in making such payment. If the Company does not purchase any tendered Shares pursuant to the Offer for any reason, or if you submit Share Certificates representing more Shares than you wish to tender, the Company will return the Share Certificates representing unpurchased or untendered Shares, without expense to you (or, in the case of Shares delivered by book-entry transfer into the Depositary's account at the Book-Entry Transfer Facility pursuant to the procedures set forth in "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares," the Shares will be credited to an account maintained within the Book-Entry Transfer Facility), as promptly as practicable following the expiration, termination or withdrawal of the Offer. -16- If, prior to the expiration date, the Company increases the Purchase Price offered to holders of Shares in the Offer, the Company will pay the increased price to all holders of Shares that we purchase in the Offer, whether or not the Shares were tendered before the increase in price. 3. PROCEDURES FOR ACCEPTING THE OFFER AND TENDERING SHARES A. GENERAL. To tender Shares pursuant to this Offer, you must deliver before the Expiration Date to the Depositary at its addresses set forth on the back cover of this Offer: (i) either (A) the Letter of Transmittal (or a facsimile thereof), properly completed and duly executed, together with any required signature guarantees (and any other documents required by the Letter of Transmittal) or (B) an Agent's Message in connection with a book-entry delivery of shares; and (ii) either (A) the Share Certificates for the tendered Shares must be received by the Depositary at one of such addresses; (B) the 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; or (C) you must comply with the guaranteed delivery procedures described below. The method of delivery of Shares, the Letter of Transmittal and all other required documents, including delivery through the Book-Entry Transfer Facility, is at your option and sole risk, and delivery will be considered made only when the Depositary actually receives the Shares. If delivery is by mail, registered mail with return receipt requested, properly insured, is recommended. In all cases, you should allow sufficient time to ensure timely delivery. B. BOOK-ENTRY TRANSFER. The Depositary will make a request to establish an account with respect to the Shares at the Book-Entry Transfer Facility for purposes of the Offer within two business days after the date of this Offer. Any financial institution that is a participant in the system of the Book-Entry Transfer Facility may make book-entry delivery of Shares by causing the Book-Entry Transfer Facility to transfer the Shares into the Depositary's account at the Book-Entry Transfer Facility in accordance with the Book-Entry Transfer Facility's procedures. However, although Shares may be delivered through book-entry transfer into the Depositary's account at the Book-Entry Transfer Facility, the Depositary must receive the Letter of Transmittal (or facsimile), properly completed and executed, with any required signature guarantees, or an Agent's Message in connection with a book-entry transfer, and any other required documents, at one of its addresses set forth on the back cover of this Offer to Purchase on or before the Expiration Date, or you must comply with the guaranteed delivery procedure set forth below. Delivery of documents to the Book-Entry Transfer facility in accordance with the Book-Entry Transfer Facility's procedures does not constitute delivery to the Depositary. C. SIGNATURE GUARANTEES. A bank, broker, dealer, credit union, savings association or other entity which is a member in good standing of the Securities Transfer Agents Medallion Program (an "Eligible Institution") must guarantee signatures on all Letter of Transmittal, unless the Shares tendered are tendered: (i) by a registered holder of Shares who has not completed either the box labeled "Special Payment Instructions" or the box labeled "Special Delivery Instructions" on the Letter of Transmittal; or (ii) for the account of an Eligible Institution. See Instruction 1 of the Letter of Transmittal. If the Share Certificates are registered in the name of a person other than the signer of the Letter of Transmittal, or if payment is to be made to, or Share Certificates for unpurchased Shares are to be issued or returned to, a person other than the registered holder, then the tendered certificates must be endorsed or accompanied by appropriate stock powers, signed exactly as the name or names of the registered holder or holders appear on the certificates, with the signatures on the certificates or stock powers guaranteed by an Eligible Institution as provided in the Letter of Transmittal. See Instructions 1 and 5 of the Letter of Transmittal. -17- If the Share Certificates are forwarded separately to the Depositary, a properly completed and duly executed Letter of Transmittal (or facsimile) must accompany each delivery of Share Certificates. D. GUARANTEED DELIVERY. If the Share Certificates are not immediately available or time will not permit all required documents to reach the Depositary on or before the Expiration Date or the procedures for book-entry transfer cannot be completed on time, the Shares may nevertheless be tendered if you comply with all of the following guaranteed delivery procedures: (i) tender is made by or through an Eligible Institution; (ii) the Depositary receives, as described below, a properly completed and signed Notice of Guaranteed Delivery, substantially in the form made available by us, on or before the Expiration Date; and (iii) the Depositary receives the Share Certificates (or a Book-Entry Confirmation) representing all tendered Shares, in proper form for transfer together with a properly completed and duly executed Letter of Transmittal (or facsimile), with any required signature guarantees (or, in the case of a book-entry transfer, an Agent's Message) and any other documents required by the Letter of Transmittal within three trading days after the date of execution of the Notice of Guaranteed Delivery. The Notice of Guaranteed Delivery may be delivered by hand, mail or facsimile transmission to the Depositary and must include a guarantee by an Eligible Institution in the form set forth in the Notice of Guaranteed Delivery. Notwithstanding any other provision of the Offer, we will pay for Shares only after the conditions to the Offer have been met and only after timely receipt by the Depositary of Share Certificates for, or of Book-Entry Confirmation with respect to, the Shares, a properly completed and duly executed Letter of Transmittal (or facsimile thereof), together with any required signature guarantees (or, in the case of a book-entry transfer, an Agent's Message) and any other documents required by the appropriate Letter of Transmittal. Accordingly, payment might not be made to all tendering stockholders at the same time, and will depend upon when the Depositary receives Share Certificates or Book-Entry Confirmation that the Shares have been transferred into the Depositary's account at the Book-Entry Transfer Facility. E. BACKUP FEDERAL INCOME TAX WITHHOLDING. Under the backup federal income tax withholding laws applicable to certain stockholders (other than certain exempt stockholders, including, among others, all corporations and certain foreign individuals), the Depositary may be required to withhold 31% of the amount of any payments made to those stockholders pursuant to the Offer. To prevent backup federal income tax withholding, you must provide the Depositary with your correct taxpayer identification number and certify that you are not subject to backup federal income tax withholding by completing the Substitute Form W-9 included in the Letter of Transmittal. See Instruction 9 of the Letter of Transmittal. F. DETERMINATION OF VALIDITY. All questions as to the form of documents and the validity, eligibility (including time of receipt) and acceptance for payment of any tender of Shares will be determined by the Company, in its sole discretion, which determination will be final and binding on all parties. The Company reserves the absolute right to reject any or all tenders determined by it not to be in proper form or the acceptance of or payment for which may, in the opinion of counsel for the Company, be unlawful. The Company also reserves the absolute right to waive any of the conditions of the Offer or any defect or irregularity in any tender of Shares of any particular stockholder whether or not similar defects or irregularities are waived in the case of other stockholders. -18- The Company's interpretation of the terms and conditions of the Offer will be final and binding. No tender of Shares will be deemed to have been validly made until all defects and irregularities with respect to the tender have been cured or waived by the Company. None of the Company nor any of its affiliates or assigns, the Depositary or any other person or entity will be under any duty to give any notification of any defects or irregularities in tenders or incur any liability for failure to give any such notification. G. BINDING AGREEMENT. The Company's acceptance for payment of Shares tendered pursuant to any of the procedures described above will constitute a binding agreement between the Company and you upon the terms and subject to the conditions of the Offer. 4. WITHDRAWAL RIGHTS Except as described in this Section 4, tenders of Shares made in the Offer are irrevocable. Withdrawal of the Shares that have been previously tendered in the Offer is allowed at any time on or before the Expiration Date. If, for any reason, acceptance for payment of any Shares tendered in the Offer is delayed, or the Company is unable to accept for payment or pay for Shares tendered in the Offer, then, without prejudice to its rights set forth in this document, the Depositary may, nevertheless, on the Company's behalf, retain Shares that have been tendered, and the tendering stockholder may not withdraw such Shares except to the extent that such tendering stockholder is entitled to and duly exercise withdrawal rights as described in this Section 4. Any such delay will be by an extension of the Offer to the extent required by law. In order for the withdrawal to be effective, the withdrawing stockholder must deliver a written or facsimile transmission notice of withdrawal to the Depositary at its address set forth on the back cover of this Offer. Any such notice of withdrawal must specify the withdrawing stockholder's name, the number of Shares that is to be withdrawn, and (if Share Certificates have been tendered) the name of the registered holder of the Shares as shown on the Share Certificate, if different from such withdrawing stockholder's name. If Share Certificates have been delivered or otherwise identified to the Depositary, then prior to the physical release of such certificates, the withdrawing stockholder must submit the serial numbers shown on the particular certificates evidencing the Shares to be withdrawn, and an Eligible Institution, as defined in "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares", must guarantee the signature on the notice of withdrawal, except in the case of Shares tendered for the account of an Eligible Institution. If the Shares have been tendered pursuant to the procedures for book-entry transfer set forth in "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares," the notice of withdrawal must also specify the name and number of the account at the appropriate Book-Entry Transfer Facility to be credited with the withdrawn Shares, in which case a notice of withdrawal will be effective if delivered to the Depositary by any method of delivery described in the first sentence of this paragraph. The withdrawing stockholder may not rescind a withdrawal of Shares. Any Shares that a withdrawing stockholder withdraw will be considered not validly tendered for purposes of the Offer, but the withdrawing stockholder may tender the withdrawn Shares again at any time before the Expiration Date by following any of the procedures described in "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares." All questions as to the form and validity (including time of receipt) of notices of withdrawal will be determined by the Company, in its sole discretion, which determination will be final and binding. Neither the Company, any of its respective affiliates or assigns, the Depositary or any other person or entity will be under any duty to give any notification of any defects or irregularities in any notice of withdrawal or incur any liability for failure to give any such notification. 5. OVERSUBSCRIPTION A. GENERAL. In the event of an over-subscription of the Offer, Shares tendered prior to the Expiration Date (other than Odd Lots) will be subject to proration, as described below. The proration period also expires on the -19- Expiration Date. All Shares tendered and not purchased pursuant to the Offer, including Shares not purchased because of proration, will be returned to the tendering shareholders at the Company's expense as promptly as practicable following the Expiration Date. The Company reserves the right, in its sole discretion to purchase more than 375,000 Shares pursuant to the Offer, but does not currently plan to do so. B. PRIORITY OF PURCHASES. Upon the terms and subject to the conditions of the Offer, if more than 375,000 Shares (or such greater number of Shares as the Company may elect to purchase) have been validly tendered, and not withdrawn, prior to the Expiration Date, the Company will accept for payment and therefore purchase validly tendered Shares on the basis set forth below: (i) first, all Shares validly tendered and not withdrawn prior to the Expiration Date by any Odd Lot Holder (as defined below) who tenders all Shares owned beneficially or of record by such Odd Lot Holder (tenders of less than all the Shares owned by such Odd Lot Holder will not qualify for this preference) and completes the section entitled "Odd Lots" in the Letter of Transmittal and, if applicable, in the Notice of Guaranteed Delivery; and (ii) second, after the purchase of all of the foregoing Shares, all other Shares validly tendered, and not withdrawn, prior to the Expiration Date, on a pro rata basis as described below. C. DEFINITION OF ODD LOT HOLDER. For purposes of the Offer, the term "Odd Lots" means all Shares validly tendered prior to the Expiration Date and not withdrawn by any person (an "Odd Lot Holder") who owned beneficially or of record as of the close of business on January 8, 2001, and who continues to own beneficially or of record as of the Expiration Date, an aggregate of fewer than 100 Shares (not including any Shares held pursuant to the Company's employee stock ownership plan or 401(k) plan) and so certifies in the appropriate place on the Letter of Transmittal and, if applicable, on the Notice of Guaranteed Delivery. As set forth above, Odd Lots will be accepted for payment before proration, if any, of the purchase of other tendered Shares. This preference is not available to partial tenders by an Odd Lot Holder, to beneficial or record holders of an aggregate of 100 or more Shares, even if these holders have separate accounts or certificates representing fewer than 100 Shares, or with respect to any Shares held pursuant to the Company's employee stock ownership plan or 401(k) plan. Any Odd Lot Holder wishing to tender all of such holder's Shares pursuant to the Offer must complete the section entitled "Odd Lots" in the Letter of Transmittal and, if applicable, in the Notice of Guaranteed Delivery. D. PRORATION. In the event that proration of tendered Shares is required, the Company will determine the proration factor as soon as practicable following the Expiration Date. Proration for each shareholder tendering Shares, other than Odd Lot Holders, will be based on the ratio of the number of Shares validly tendered and not properly withdrawn by such shareholder to the total number of Shares validly tendered and not properly withdrawn by all shareholders, other than Odd Lot Holders. Because of the difficulty in determining the number of Shares validly tendered (including Shares tendered by guaranteed delivery procedures) and not properly withdrawn, and because of the Odd Lot procedure, the Company does not expect that it will be able to announce the final proration factor or commence payment for any Shares purchased pursuant to the Offer until approximately seven (7) business days after the Expiration Date. The preliminary results of any proration will be announced by press release as promptly as practicable after the Expiration Date. 6. PRICE RANGE OF THE SHARES; DIVIDENDS The Shares are listed and traded on the NASDAQ National Market under the symbol "SWHI." The following table sets forth, for the periods indicated, the range of the high and low per Share sales prices as reported by NASDAQ. -20- 2000 HIGH LOW ---- ---- --- 1st Quarter $6.12 $5.12 2nd Quarter $6.50 $4.87 3rd Quarter $6.43 $5.75 4th Quarter $6.87 $4.62 1999 HIGH LOW ---- ---- --- 1st Quarter $12.12 $7.00 2nd Quarter $9.75 $5.75 3rd Quarter $10.62 $6.87 4th Quarter $7.37 $5.87 1998 HIGH LOW ---- ---- --- 1st Quarter $8.37 $5.62 2nd Quarter $10.75 $7.00 3rd Quarter $8.75 $6.50 4th Quarter $8.25 $5.87 As of the close of business on January 5, 2001, the closing price of the Shares as reported on the NASDAQ National Market was $7.00 per Share. As explained in "Special Factors - 2.B. Certain Effects of the Offer," the Shares may be delisted from the NASDAQ following the Offer. After that time, it may be more difficult to obtain accurate market quotations for the Shares The Company and its affiliates, including its executive officers and directors, will be prohibited under applicable federal securities law from purchasing additional Shares outside of the Offer until at least the 10th business day after the Expiration Date. Following such time, the Company may purchase additional Shares in the open market, in private transactions, through a subsequent offer, or otherwise, any of which may be consummated at purchase prices higher or lower than that offered in the Offer described in this Offer. The decision to repurchase additional Shares, if any, will depend upon many factors, including the market price of the Shares, the results of the Offer, the business and financial position of the Company, and general economic and market conditions. Any such repurchase may be on the same terms or on terms more or less favorable to stockholders than the terms of the Offer as described in this Offer. As of September 13, 2000, there were approximately 569 registered holders of the Company's common stock and 660 holders in street name. The Company paid dividends to stockholders of $.05 per share in 1994 and $.15 per share in 1995. No dividends were paid in 1998, 1999 or 2000. The Company has no present intention to pay dividends on the Shares in the near future. In addition, the Company may be restricted in its ability to pay dividends by a covenant to maintain a certain amount of liquid assets pursuant to the Addendum to and Modification of Promissory Note dated as of December 1, 2000 between the Company and Wells Fargo Bank National Association. 7. POSSIBLE EFFECTS OF THE OFFER ON THE MARKET FOR THE SHARES AND EXCHANGE ACT REGISTRATION The purchase of the Shares pursuant to the Offer will reduce the number of Shares that might otherwise be traded and the number of holders of Shares, which could adversely affect the liquidity and market value of the remaining Shares held by the public and have other consequences with respect to the Exchange Act registration of the Shares. See "SPECIAL FACTORS - 2.B. Certain Effects of the Offer." 8. CERTAIN INFORMATION CONCERNING THE COMPANY A. GENERAL. The Company is a California corporation with its principal executive offices located at 1448 Industrial Avenue, Sebastopol, California and the phone number is 707-824-2548. -21- B. DIRECTORS AND EXECUTIVE OFFICERS. Each of the persons named below was elected to serve as a member of the Company's Board of Directors until the 2001 Annual Meeting of Stockholders and until his successor has been duly elected and qualified. The names of the current directors and certain information about them, as of January 8, 2001, are set forth below.
Name Age Position Director Since ---- --- -------- -------------- Gary L. Hess 48 President, CEO, CFO and Director 1996 Roger S. Mertz 56 Secretary and Director 1993 Fredric Selinger 61 Director 1999 Craig R. Stapleton 56 Director 1995
Mr. Hess was elected President and Chief Executive Officer of the Company on May 1, 1996 and Chief Financial Officer on June 14, 1999. Prior thereto he was a Senior Vice President of Dole Food Company, Inc. (fresh and processed fruit) (1993-1996); President of Cadace Enterprises, Inc. (water conservation products) and The Marketing Partnership 1992-1993; and Director of Marketing, E. & J. Gallo Winery (wine and distilled spirits) (1987-1992). Mr. Mertz is an attorney-at-law. He is a partner of the California law firm of Allen Matkins Leck Gamble & Mallory LLP. Prior to October 1999, Mr. Mertz was a member of the San Francisco, California law firm of Severson & Werson. Mr. Selinger is the Senior Managing Director of Corporate Finance of Sutter Securities, Incorporated (private investment banking and consulting). Prior to March 1995, Mr. Selinger was Managing Director of Jackson Square Capital Corp. (private investment banking and consulting). Mr. Stapleton is the President of Marsh & McLennan Real Estate Advisors, Inc. (real estate management). Mr. Stapleton is a director of Allegheny Properties, Inc. (real estate investments); a director of T.B. Woods, Incorporated (industrial power transmission products); and a director of Cornerstone Properties (real estate investments). Mr. Hess and Mr. Mertz are the only executive officers of the Company. During the last five years, to the best knowledge of the Company, none of the persons listed above have been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or 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 activities subject to, federal or state securities laws or finding any violation of such laws. C. AVAILABLE INFORMATION. The Company 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 SEC relating to its business, financial condition and other matters. Information as of certain dates concerning the Company's directors and officers, their remuneration, stock options granted to them, the principal holders of the Company's securities and any material interest of such persons in transactions with the Company is required to be disclosed in proxy statements distributed to the Company's stockholders and filed with the SEC. Such reports, proxy statements and other information should be available for inspection at the public reference facilities maintained by the SEC, 450 Fifth Street, N.W., Washington, D.C. 20549, and also should be available for inspection at the SEC's regional offices located at Seven World Trade Center, Suite 1300, New York, New York 10048 and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such materials may also be obtained (i) by mail, upon payment of the SEC's customary fees, by writing to its principal office at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, or (ii) at the SEC's world-wide web site at www.sec.gov. -22- D. HISTORICAL FINANCIAL INFORMATION. The audited financial statements set forth on pages F-2 through F-20 of the Company's Form 10-KSB for the fiscal year ended June 30, 2000 and the unaudited financial statements in the Company's Form 10-QSB for the fiscal quarter ended September 31, 2000 are hereby incorporated by reference into this Offer. Such reports, documents and other financial information may be inspected and copies may be obtained from the SEC in the manner set forth above. 9. CONDITIONS TO THE OFFER Notwithstanding any other term of the Offer, the Company will not be required to accept for payment or, subject to any applicable rules and regulations of the SEC, including Rule 14e-1(c) under the Exchange Act (relating to the Company's obligation to pay for or return tendered Shares after the termination or withdrawal of the Offer), pay for any Shares not theretofore accepted for payment or paid for, and may terminate or amend the Offer, if: (1) there will be pending or overtly threatened any suit, action or proceeding brought by or on behalf of any governmental entity, or any suit, action or proceeding brought by or on behalf of any stockholder of the Company or any other person or party (A) challenging the acquisition of any Shares pursuant to the Offer, seeking to restrain or prohibit the making or consummation of the Offer, or alleging that any such acquisition or other transaction relates to, involves or constitutes a breach of fiduciary duty by the Company's directors or a violation of federal securities law or applicable corporate law or (B) seeking to impose a material condition to the Offer which would be adverse to the Company's stockholders; (2) there will be any statute, rule, regulation, judgment, order or injunction enacted, entered, enforced, promulgated or deemed applicable to the Offer or any other action will be taken by any governmental entity or court, that is reasonably likely to result, in any of the consequences referred to in clauses (A) and (B) of paragraph (1) above; (3) there will have occurred (A) any general suspension of, shortening of hours for or limitation on prices for trading in securities in the over-the-counter market (whether or not mandatory), (B) any significant adverse change in the price of the Shares or in the United States' securities or financial markets, (C) a significant impairment in the trading market for equity securities, (D) the declaration of a banking moratorium or any suspension of payments in respect of banks in the United States (whether or not mandatory), (E) the commencement of a war, armed hostilities or other international or national calamity directly or indirectly involving the United States and having a material adverse effect on the Company or materially adversely affecting (or materially delaying) the consummation of the Offer, (F) any limitation or proposed limitation (whether or not mandatory) by any U.S. governmental authority or agency, or any other event, that materially adversely affects generally the extension of credit by banks or other financial institutions, or (G) in the case of any of the situations described in clauses (A) through (F) inclusive existing at the date of commencement of the Offer, a material escalation or worsening thereof; or (4) there will have occurred or be likely to occur any event or series of events that, in the sole judgment of the Company, would or might prohibit, prevent, restrict or delay consummation of the Offer or that will, or is reasonably likely to, impair the contemplated benefits to the Company of the Offer, or otherwise result in the consummation of the Offer not being or not being reasonably likely to be in the best interest of the Company; which, in the reasonable judgment of the Company and regardless of the circumstances giving rise to any such condition, makes it inadvisable to proceed with the Offer or with such acceptance for payment or payment for Shares. The foregoing conditions are for the sole benefit of the Company and its affiliates and may be asserted by the Company regardless of the circumstances giving rise to such condition or may be waived by the Company in whole or in part at any time and from time to time in its sole discretion. If any condition to the Offer is not satisfied or waived by the Company prior to the Expiration Date, the Company reserves the right (but shall not be obligated), subject to applicable law: (i) to terminate the Offer and return the tendered Shares to the tendering stockholders; (ii) -23- to waive all unsatisfied conditions and accept for payment and purchase all Shares that are validly tendered (and not withdrawn) prior to the Expiration Date; (iii) to extend the Offer and retain the Shares that have been tendered during the period for which the Offer is extended; or (iv) to amend the Offer. The failure by the Company at any time to exercise any of the foregoing rights will not be deemed a waiver of or otherwise affect any other rights and each such right will be deemed an ongoing right which may be asserted at any time and from time to time. Any determination by the Company concerning the events described above will be final and binding upon all parties. The Company acknowledges that the SEC believes that (i) if the Company is delayed in accepting the Shares it must either extend the Offer or terminate the Offer and promptly return the Shares, and (ii) the circumstances in which a delay in payment is permitted are limited and do not include unsatisfied conditions of the Offer. 10. LEGAL MATTERS The Company is not aware of any license or regulatory permit that appears to be material to the business of the Company and that might be adversely affected by the Company's acquisition of Shares pursuant to the Offer, or of any approval or other action by any governmental, administrative or regulatory agency or authority, domestic or foreign, that would be required for the acquisition or ownership of Shares by the Company 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 and if such approval could not be obtained in a timely manner, the Offer would be terminated. 11. FEES AND EXPENSES Except as otherwise provided herein, all fees and expenses incurred in connection with the Offer will be paid by the party incurring such fees and expenses, except that the Company will pay for all fees and expenses relating to the filing, printing and mailing of the documents in connection with the Offer. Estimated fees and expenses to be incurred by the Company in connection with the Offer, are as follows: Depositary Fees............................................... $7,500 Legal, Accounting and Other Professional Fees................. 40,000 Printing and Mailing Costs .................................... 10,000 SEC Filing Fees....................................................600 Miscellaneous.................................................. 5,000 ------- Total........................................................ $63,100 ====== Directors, officers and regular employees of the Company and its affiliates (who will not be specifically compensated for such services) may contact stockholders by mail, telephone, telex, telegram messages, mailgram messages, datagram messages and personal interviews regarding the Offer and may request brokers, dealers and other nominees to forward this Offer to Purchase and related materials to beneficial owners of Shares. The Company will reimburse its affiliates for the time that the employees of such affiliates spend performing such services. Except as set forth above, neither the Company nor any person acting on its behalf has employed, retained or compensated any person or class of persons to make solicitations or recommendations on its behalf with respect to the Offer. 12. MISCELLANEOUS The Depositary for the Offer is Continental Stock Transfer & Trust Company. All deliveries, correspondence and questions sent or presented to the Depositary relating to the Offer should be directed to the address or telephone number set forth on the back cover of this Offer. The Company will pay the Depositary reasonable and customary compensation for its services in connection with the Offer, plus reimbursement for reasonable out-of-pocket expenses. -24- Depositary does not assume any responsibility for the accuracy or completeness of the information concerning the Company or its affiliates contained in this Offer to Purchase or for any failure by the Company to disclose events that may have occurred and may affect the significance or accuracy of such information. Brokers, dealers, commercial banks and trust companies will be reimbursed by the Company for customary mailing and handling expenses incurred by them in forwarding material to their customers. The Company will not pay any fees or commissions to any broker, dealer or other person in connection with the solicitation of tenders of Shares pursuant to the Offer. We are not aware of any jurisdiction where the making of the Offer is prohibited by any 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 the Shares, we will make a good faith effort to comply with that state statute. If, after a good faith effort, we cannot comply with the state statute, we will not make the Offer to, nor will we accept tenders from or on behalf of, the holders of Shares in that state. We have filed with the SEC a Tender Offer Statement on Schedule TO together with exhibits, furnishing certain additional information with respect to the Offer, and may file amendments to our Schedule TO. The Schedule TO and any exhibits or amendments may be examined and copies may be obtained from the SEC in the same manner as described in "THE OFFER - 8. Certain Information Concerning the Company" with respect to information concerning the Company except that copies will not be available at the regional offices of the SEC. We have not authorized any person to give any information or to make any representation on behalf of the Company not contained in this Offer to Purchase or in the Letter of Transmittal and, if given or made, you should not rely on any such information or representation as having been authorized. Neither the delivery of this Offer to Purchase nor any purchase pursuant to the Offer will under any circumstances create any implication that there has been no change in the affairs of the Company since the date as of which information is furnished or the date of this Offer to Purchase. FACSIMILE COPY OF LETTER OF TRANSMITTAL, PROPERLY COMPLETED AND DULY EXECUTED, WILL BE ACCEPTED. THE LETTER OF TRANSMITTAL, CERTIFICATES FOR SHARES AND ANY OTHER REQUIRED DOCUMENTS SHOULD BE SENT OR DELIVERED BY YOU OR YOUR 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 2 Broadway, 19th Floor New York, N.Y. 10004 Reorganization Department Telephone: 212-509-4000 x. 535 Fax: 212-616-7610 Attn: Roger Bernhammer YOU MAY DIRECT QUESTIONS AND REQUESTS FOR ASSISTANCE TO THE COMPANY AT THE TELEPHONE NUMBER AND ADDRESS SET FORTH BELOW. YOU MAY OBTAIN ADDITIONAL COPIES OF THIS OFFER TO PURCHASE, THE LETTER OF TRANSMITTAL, THE NOTICE OF GUARANTEED DELIVERY AND OTHER TENDER OFFER MATERIALS FROM THE COMPANY AS SET FORTH BELOW AND THEY WILL BE FURNISHED PROMPTLY AT OUR EXPENSE. YOU MAY ALSO CONTACT YOUR BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR OTHER NOMINEE FOR ASSISTANCE CONCERNING THE OFFER. Gary L. Hess President and CEO SonomaWest Holdings, Inc. 1448 Industrial Avenue Sebastopol, California 95472 (707) 824-2548 -25 EX-99.A2 3 0003.txt LETTER OF TRANSMITTAL EXHIBIT(A)(2) LETTER OF TRANSMITTAL TO ACCOMPANY SHARES OF COMMON STOCK OF SONOMAWEST HOLDINGS, INC. TENDERED PURSUANT TO THE OFFER TO PURCHASE DATED JANUARY 8, 2001 - -------------------------------------------------------------------------------- THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., PACIFIC TIME, ON FEBRUARY 15, 2001 UNLESS THE OFFER IS EXTENDED. - ------------------------------------------------------------------------------- In order to tender shares of common stock pursuant to the Offer to Purchase dated January 8, 2001 (the "Offer to Purchase"), this Letter of Transmittal, the certificates for Shares to be tendered and any other required documents should be sent or delivered by each stockholder of SonomaWest Holdings, Inc. (the "Company") or such stockholder's broker, dealer, commercial bank or other nominee to the Depositary at its address set forth below. The Depositary for the Offer is: Continental Stock Transfer & Trust Company 2 Broadway, 19th Floor New York, N.Y. 10004 Reorganization Department Telephone: 212-509-4000 x. 535 Fax: 212-616-7610 Attn: Roger Bernhammer DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED. -1- DESCRIPTION OF SHARES TENDERED (SEE INSTRUCTIONS 3 AND 4) Name(s) and address(es) of registered holder(s) (please fill in, if blank, exactly as name(s) appear(s) on Share Certificate(s)) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- - -------------------------------------------------------------------------------
Total Number of Shares Evidenced by Number of Certificate Number(s)(1) Share Certificate(s)(1) Shares Tendered (2) - --------------------------- ----------------------- -------------------- - -------------------------- ----------------------- -------------------- - -------------------------- ----------------------- -------------------- - -------------------------- ----------------------- -------------------- - -------------------------- ----------------------- -------------------- Total Shares: ----------------------- --------------------
Indicate below the order (by Certificate Number) in which shares are to be purchased in event of Proration(3): 1st_______________; 2nd_______________; 3rd_______________; 4th_______________; 5th_______________ *Attach additional list, if necessary. (1) Need not be completed by shareholders delivering Shares by book-entry transfer. (2) Unless otherwise indicated, it will be assumed that all Shares evidenced by each Share Certificate delivered to the Depositary are being tendered hereby. See Instruction 4. (3) If you do not designate an order, in the event less than all shares tendered are purchased due to prorations, shares will be selected for purchase by the Depositary. ---------------------------------------------------------------------- This Letter of Transmittal is to be completed by stockholders of the Company if certificates evidencing the Shares (as defined below) are to be forwarded herewith or, unless an Agent's Message (as defined in the Offer) is utilized, or if delivery of the Shares is to be made by book-entry transfer to the Depositary's account at [The Depository Trust Company] (the "Book-Entry Transfer Facility") pursuant to the book-entry transfer procedures described in "THE OFFER - Section 3. Procedures for Accepting the Offer and Tendering Shares" of the Offer to Purchase (as defined below). See Instruction 2. Shareholders whose certificates evidencing the Shares ("Share Certificates") are not immediately available or who cannot deliver their Share Certificates and all other documents required hereby to the Depositary prior to the Expiration Date (as defined in the Introduction to the Offer to Purchase) or who cannot complete the procedure for delivery by book-entry transfer on a timely basis and who wish to tender their Shares must do so pursuant to the guaranteed delivery procedure described in "THE OFFER - Section 3. Procedures for Accepting the Offer and Tendering Shares" of the Offer to Purchase. Delivery of documents to the Book-Entry Transfer Facility does not constitute delivery to the Depositary. See Instruction 2. -2- TENDER OF SHARES [ ] Check here if any of the Share Certificates representing the Shares that you own have been lost, destroyed or stolen and see Instruction 10. Number of Shares represented by lost, destroyed or stolen certificates: -------------------------------------------------------------------------- -------------------------------------------------------------------------- [ ] Check here if the Shares are being delivered by book-entry transfer to the Depositary's account at the Book-Entry Transfer Facility and complete the following (only participants in the Book-Entry Transfer Facility may deliver the Shares by book-entry transfer): Name of Tendering Institution: -------------------------------------------- Account Number: ----------------------------------------------------------- Transaction Code Number:--------------------------------------------------- [ ] Check here if the Shares are being tendered pursuant to a Notice of Guaranteed Delivery previously sent to the Depositary and complete the following: Name(s) of Registered Holder(s):------------------------------------------ Window Ticket No. (if any):----------------------------------------------- Date of Execution of Notice of Guaranteed Delivery:----------------------- Name of Institution which Guaranteed Delivery: --------------------------- ODD LOTS: If the Shares being tendered by or on behalf of a person owning, beneficially or of record, as of the close of business on January 8, 2001, and who continues to own, beneficially or of record, as of the Expiration Date, an aggregate of fewer than 100 Shares, please complete the following (See Instruction 12): The undersigned certifies that the undersigned (check one box): [ ] was the beneficial or record owner of, as of the close of business on January 8, 2001 and continues to own, beneficially or of record as of the Expiration Date, an aggregate of fewer than 100 Shares, all of which are being tendered; or [ ] is a broker, dealer, commercial bank, trust company, or other nominee that: (i) is tendering, for the beneficial owner(s) hereof, Shares with respect to which it is the record holder and (ii) believes that, based upon representations made to it by such beneficial owner(s), that each such person was the beneficial or record owner of, as of the close of business on January 8, 2001 and continues to own, beneficially or of record as of the Expiration Date, an aggregate of fewer than 100 Shares, all of which are being tendered. Please read the instructions set forth in this Letter of Transmittal carefully. -3- To the Depositary: The undersigned hereby tenders to SonomaWest Holdings, Inc., a California corporation (the "Company"), all of the above-referenced shares of common stock, no par value, of the Company (the "Shares"), pursuant to the Company's offer to purchase up to 375,000 shares of its common stock at a price of $8.00 per share, net to the seller in cash, without interest thereon, subject to reduction for any applicable federal backup or other withholding or stock transfer taxes, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated January 8, 2001 (the "Offer to Purchase"), receipt of which is hereby acknowledged, and in this Letter of Transmittal (which, as amended or supplemented from time to time, together constitute the "Offer"). The undersigned understands that if more than 375,000 shares of its common stock is tendered and not withdrawn by the Expiration Date, the Company will, as described in the Offer to Purchase first purchase shares from Odd Lot holders (holders of less than 100 shares of common stock) and then on a pro rata basis from all other stockholders. Subject to, and effective upon, acceptance for payment of and payment for the Shares tendered herewith in accordance with the terms of the Offer, the undersigned hereby sells, assigns and transfers to, or upon the order of, the Company all right, title and interest in and to all the Shares that are being tendered hereby and all dividends, distributions (including, without limitation, distributions of additional Shares) and rights declared, paid or distributed in respect of such Shares on or after January 8, 2001 (collectively, "Distributions"), and irrevocably appoints the Depositary the true and lawful agent and attorney-in-fact of the undersigned with respect to such Shares and all Distributions, with full power of substitution (such power of attorney being deemed to be an irrevocable power coupled with an interest), to: (i) deliver Share Certificates evidencing such Shares and all Distributions, or transfer ownership of such Shares and all Distributions on the account books maintained by the Book-Entry Transfer Facility, together, in either case, with all accompanying evidences of transfer and authenticity, to, or upon the order of, the Company; (ii) present such Shares and all Distributions for transfer on the books of the Company; and (iii) receive all benefits and otherwise exercise all rights of beneficial ownership of such Shares and all Distributions, all in accordance with the terms of the Offer. The undersigned hereby represents and warrants that the undersigned has full power and authority to tender, sell, assign and transfer the Shares tendered hereby and all Distributions, that when such Shares are accepted for payment by the Company, the Company will acquire good, marketable and unencumbered title thereto and to all Distributions, free and clear of all liens, restrictions, charges and encumbrances, and that none of such Shares and Distributions will be subject to any adverse claim. The undersigned, upon request, shall execute and deliver all additional documents deemed to be necessary or advisable to complete the sale, the assignment and transfer of the Shares tendered hereby and all Distributions. In addition, the undersigned shall remit and transfer promptly to the Depositary for the account of the Company all Distributions in respect of the Shares tendered hereby, accompanied by appropriate documentation of transfer, and pending such remittance and transfer or appropriate assurance thereof, the Company shall be entitled to all rights and privileges as owner of each such Distribution and may withhold the entire purchase price of the Shares tendered hereby, or deduct from such purchase price, the amount or value of such Distribution as determined by the Company in its sole discretion. No authority herein conferred or agreed to be conferred in this Letter of Transmittal shall be affected by, and all such authority shall survive, the death or incapacity of the undersigned. All obligations of the undersigned hereunder shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned. Except as stated in the Offer to Purchase, this tender is irrevocable. The undersigned understands that tenders of the Shares pursuant to any one of the procedures described in "THE OFFER - Section 3. Procedures for Accepting the Offer and Tendering Shares" of the Offer to Purchase and in the instructions hereto will constitute the undersigned's acceptance of the terms and conditions of the Offer. The Company's acceptance of such Shares for payment will constitute a binding agreement between the undersigned and the Company upon the terms and subject to the conditions of the Offer (and if the Offer is extended or amended, the terms or conditions of any such extension or amendment). The undersigned recognizes that under certain circumstances set forth in the Offer to Purchase, the Company may not be required to accept for payment some or all Shares tendered hereby. Unless otherwise indicated herein in the box entitled "Special Payment Instructions," please issue the check for the purchase price of all Shares purchased, and return all Share Certificates evidencing the Shares not purchased -4- or not tendered in the name(s) of the registered holder(s) appearing above under "Description of Shares Tendered." Similarly, unless otherwise indicated in the box entitled "Special Delivery Instructions," please mail the check for the purchase price of all Shares purchased and all Share Certificates evidencing Shares not tendered or not purchased (and accompanying documents, as appropriate) to the address(es) of the registered holder(s) appearing above under "Description of Shares Tendered." In the event that the boxes entitled "Special Payment Instructions" and "Special Delivery Instructions" are both completed, please issue the check for the purchase price of all Shares purchased and return all Share Certificates evidencing the Shares not purchased or not tendered in the name(s) of, and mail such check and Share Certificates to, the person(s) so indicated. Unless otherwise indicated herein in the box entitled "Special Payment Instructions," please credit any Shares tendered hereby and delivered by book-entry transfer, but which are not purchased, by crediting the account at the Book-Entry Transfer Facility designated above. The undersigned recognizes that the Company has no obligation, pursuant to the "Special Payment Instructions," to transfer any Shares from the name of the registered holder(s) thereof if the Company does not accept for payment any of the Shares tendered hereby. -5- SPECIAL PAYMENT INSTRUCTIONS (SEE INSTRUCTIONS 1, 4, 5, 6 AND 7) To be completed ONLY if the check for the purchase price of the Shares or Share Certificates evidencing the Shares not tendered or not purchased are to be issued in the name of someone other than the undersigned, or if the Shares tendered hereby and delivered by book-entry transfer which are not purchased are to be returned by credit to an account at the Book-Entry Transfer Facility other than that designated above Issue: [ ] Check [ ] Certificate(s) to: Name: ------------------------------------------------------------------------ (Please Print) Address:----------------------------------------------------------------------- ----------------------------------------------------------------------- (Include Zip Code) ------------------------------------------------------------------------ Taxpayer Identification or Social Security Number (See Substitute Form W-9 on Page 11) [ ] Credit Shares delivered by book-entry transfer and not purchased to the account set forth below at The Depository Trust Company. ------------------------------------------------------------------------- (Account Number) SPECIAL DELIVERY INSTRUCTIONS (INSTRUCTIONS 1, 4, 5, AND 7) To be completed ONLY if the check for the purchase price of the Shares purchased or Share Certificates evidencing the Shares not tendered or not purchased are to be mailed to someone other than the undersigned, or to the undersigned at an address other than that shown under "Description of Shares Tendered." Mail: [ ] Check [ ] Share Certificate(s) to: Name: -------------------------------------------------------------------- (Please Print) Address: -------------------------------------------------------------------- -------------------------------------------------------------------- (Include Zip Code) -------------------------------------------------------------------- Taxpayer Identification or Social Security Number (See Substitute Form W-9 on Page 11) -6- IMPORTANT: SHAREHOLDERS SIGN HERE (SEE INSTRUCTION 1 AND 5) Must be signed by registered holder(s) exactly as name(s) appear(s) on Share Certificates or on a security position listing or by person(s) authorized to become registered holder(s) by certificates and documents transmitted herewith. If signature is by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, please provide the following information. See Instruction 5. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (Signature(s) of Holder(s)) Name(s):----------------------------------------------------------------------- - ------------------------------------------------------------------------------- (Please Print) Capacity (full title):--------------------------------------------------------- Address:----------------------------------------------------------------------- - ------------------------------------------------------------------------------- (Include Zip Code) Area Code and Telephone No.:--------------------------------------------------- Tax Identification or Social Security No.:------------------------------------- Date: ________________________________, 2001 GUARANTEE OF SIGNATURE(S) (IF REQUIRED - SEE INSTRUCTIONS 1 AND 5) FOR USE BY FINANCIAL INSTITUTIONS ONLY Authorized Signature: --------------------------------------------------------- Name(s):----------------------------------------------------------------------- (Please Print) Title:------------------------------------------------------------------------- Name of Firm:------------------------------------------------------------------ Address:----------------------------------------------------------------------- - ------------------------------------------------------------------------------- (Include Zip Code) Area Code and Telephone No:---------------------------------------------------- Date: ________________________________, 2001 Tax Identification or Social Security No.:------------------------------------- PLACE MEDALLION GUARANTEE IN SPACE BELOW -7- INSTRUCTIONS FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER 1. GUARANTEE OF SIGNATURES. No signature guarantee is required on this Letter of Transmittal: (i) if this Letter of Transmittal is signed by the registered holder(s) (which term, for purposes of this document, shall include any participant in the Book-Entry Transfer Facility whose name appears on a security position listing as the owner of the Shares) of the Shares tendered herewith, unless such holder(s) has completed either the box entitled "Special Payment Instructions" or the box entitled "Special Delivery Instructions" above; or (ii) if such Shares are tendered for the account of a firm which is a bank, broker, dealer, credit union, savings association or other entity which is a member in good standing of a recognized Medallion Signature Guarantee Program (each of the foregoing being referred to as an "Eligible Institution"). In all other cases, all signatures on this Letter of Transmittal must be guaranteed by an Eligible Institution. 2. DELIVERY OF LETTER OF TRANSMITTAL AND SHARE CERTIFICATES. This Letter of Transmittal is to be used if Share Certificates are to be forwarded herewith or, unless an Agent's Message is utilized, if the Shares are to be delivered by book-entry transfer pursuant to the procedure set forth in "THE OFFER - Section 3. Procedures for Accepting the Offer and Tendering Shares" of the Offer to Purchase. Share Certificates evidencing all physically tendered Shares, or a confirmation of a book-entry transfer into the Depositary's account at the Book-Entry Transfer Facility of all Shares delivered by book-entry transfer as well as a properly completed and duly executed Letter of Transmittal (or facsimile thereof), with any required signature guarantees, or an Agent's Message in the case of a book-entry delivery, and any other documents required by this Letter of Transmittal, must be received by the Depositary at one of its addresses set forth on the cover page of this Letter of Transmittal prior to the Expiration Date, (as defined in the Introduction to the Offer to Purchase). If Share Certificates are forwarded to the Depositary in multiple deliveries, a properly completed and duly executed Letter of Transmittal must accompany each such delivery. Shareholders whose Share Certificates are not immediately available, who cannot deliver their Share Certificates and all other required documents to the Depositary prior to the Expiration Date or who cannot complete the procedure for delivery by book-entry transfer on a timely basis, may tender their Shares pursuant to the guaranteed delivery procedure described in "THE OFFER - Section 3. Procedures for Accepting the Offer and Tendering Shares" of the Offer to Purchase. Pursuant to such procedure: (i) such tender must be made by or through an Eligible Institution; (ii) a properly completed and duly executed Notice of Guaranteed Delivery, substantially in the form made available by the Company, must be received by the Depositary prior to the Expiration Date; and (iii) the Share Certificates evidencing all physically delivered Shares in proper form for transfer by delivery, or a confirmation of a book-entry transfer into the Depositary's account at the Book-Entry Transfer Facility of all Shares delivered by book-entry transfer, in each case together with a Letter of Transmittal (or a facsimile thereof), properly completed and duly executed, with any required signature guarantees (or, in the case of book-entry delivery, an Agent's Message), and any other documents required by this Letter of Transmittal, must be received by the Depositary within 3 trading days after the date of execution of such Notice of Guaranteed Delivery, all as described in "THE OFFER - Section 3. Procedures for Accepting the Offer and Tendering Shares" of the Offer to Purchase. The method of delivery of this Letter of Transmittal, Share Certificates and all other required documents, including delivery through the Book-Entry Transfer Facility, is at the option and risk of the tendering shareholder, and the delivery will be deemed made only when 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. No alternative, conditional or contingent tenders will be accepted and no fractional Shares will be purchased. By execution of this Letter of Transmittal (or a facsimile hereof), all tendering shareholders waive any right to receive any notice of the acceptance of their Shares for payment. 3. INADEQUATE SPACE. If the space provided herein under "Description of Shares Tendered" is inadequate, the Share Certificate numbers, the number of Shares evidenced by such Share Certificates and the number of Shares tendered should be listed on a separate schedule and attached hereto. 4. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY BOOK-ENTRY TRANSFER). If fewer than all the Shares evidenced by any Share Certificate delivered to the Depositary herewith are to be tendered hereby, fill in the number of Shares which are to be tendered in the box entitled "Number of Shares Tendered." In such case, new Share Certificate(s) evidencing the remainder of the Shares that were evidenced by the Share -8- Certificates delivered to the Depositary herewith will be sent to the person(s) signing this Letter of Transmittal, unless otherwise provided in the box entitled "Special Delivery Instructions," as soon as practicable after the expiration or termination of the Offer. All Shares evidenced by Share Certificates delivered to the Depositary will be deemed to have been tendered unless otherwise indicated. 5. SIGNATURES ON LETTER OF TRANSMITTAL; STOCK POWERS AND ENDORSEMENTS. If this Letter of Transmittal is signed by the registered holder(s) of the Shares tendered hereby, the signature(s) must correspond with the name(s) as written on the face of the Share Certificates evidencing such Shares without alteration, enlargement or any other change whatsoever. If any Share tendered hereby is owned of record by two or more persons, all such persons must sign this Letter of Transmittal. If any of the Shares tendered hereby are registered in the names of different holders, it will be necessary to complete, sign and submit as many separate Letters of Transmittal as there are different registrations of such Shares. If this Letter of Transmittal is signed by the registered holder(s) of the Shares tendered hereby, no endorsements of Share Certificates or separate stock powers are required, unless payment is to be made to, or Share Certificates evidencing Shares not tendered or not purchased are to be issued in the name of, a person other than the registered holder(s), in which case, the Share Certificate(s) evidencing the Shares tendered hereby must be endorsed or accompanied by appropriate stock powers, in either case signed exactly as the name(s) of the registered holder(s) appear(s) on such Share Certificate(s). Signatures on such Share Certificate(s) and stock powers must be guaranteed by an Eligible Institution. If this Letter of Transmittal is signed by a person other than the registered holder(s) of the Shares tendered hereby, the Share Certificate(s) evidencing the Shares tendered hereby must be endorsed or accompanied by appropriate stock powers, in either case signed exactly as the name(s) of the registered holder(s) appear(s) on such Share Certificate(s). Signatures on such Share Certificate(s) and stock powers must be guaranteed by an Eligible Institution. If this Letter of Transmittal or any Share Certificate or stock power is signed by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, such person should so indicate when signing, and proper evidence satisfactory to the Purchaser of such person's authority so to act must be submitted. 6. STOCK TRANSFER TAXES. Except as otherwise provided in this Instruction 6, the Company will pay all stock transfer taxes, if any, with respect to the sale and transfer of any Shares to it or its order pursuant to the Offer. If, however, payment of the purchase price of any Shares purchased is to be made to, or Share Certificate(s) evidencing Shares not tendered or not purchased are to be issued in the name of, a person other than the registered holder(s), the amount of any stock transfer taxes (whether imposed on the registered holder(s), such other person or otherwise) payable on account of the transfer to such other person will be deducted from the purchase price of such Shares purchased, unless evidence satisfactory to the Company of the payment of such taxes, or exemption therefrom, is submitted. Except as provided in this Instruction 6, it will not be necessary for transfer tax stamps to be affixed to the Share Certificates evidencing the Shares tendered hereby. 7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If a check for the purchase price of any Shares tendered hereby is to be issued, or Share Certificate(s) evidencing Shares not tendered or not purchased are to be issued, in the name of a person other than the person(s) signing this Letter of Transmittal or if such check or any such Share Certificate is to be sent to someone other than the person(s) signing this Letter of Transmittal or to the person(s) signing this Letter of Transmittal but at an address other than that shown in the box entitled "Description of Shares Tendered," the appropriate boxes on this Letter of Transmittal must be completed. Shareholders delivering Shares tendered hereby by book-entry transfer may request that Shares not purchased be credited to such account maintained at a Book-Entry Transfer Facility as such shareholder may designate in the box entitled "Special Payment Instructions." If no such instructions are given, all such Shares not purchased will be returned by crediting the account at the Book-Entry Transfer Facility designated in this Letter of Transmittal as the account from which such Shares were delivered. -9- 8. QUESTIONS AND REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions and requests for assistance may be directed to the company to the attention of Gary L. Hess, President and CEO, at SonomaWest Holdings, Inc., 1448 Industrial Avenue, Sebastopol, California 95472 (707) 824-2548. Additional copies of the Offer to Purchase, this Letter of Transmittal and the Notice of Guaranteed Delivery may be obtained from the Company. 9. SUBSTITUTE FORM W-9. Under the federal income tax law, a stockholder whose tendered Shares are accepted for payment is required by law to provide the Depositary (as Payer) with such shareholder's correct Tax Identification Number ("TIN") on Substitute Form W-9 below. If such stockholder is an individual, the TIN is such stockholder's social security number. If the tendering stockholder has not been issued a TIN and has applied for a number or intends to apply for a number in the near future, the shareholder should write "Applied For" in the space provided for the TIN in Part 1, and sign and date the Substitute Form W-9. If the Depositary is not provided with the correct TIN, the stockholder may be subject to a $50 penalty imposed by the Internal Revenue Service. In addition, payments that are made to such stockholder with respect to Shares purchased pursuant to the Offer may be subject to backup withholding. If backup withholding applies, the Depositary is required to withhold 31% of any payments made to the stockholder. Backup withholding is not an additional tax. Rather, the tax liability of persons subject to backup withholding will be reduced by the amount of tax withheld. If withholding results in an overpayment of taxes, a refund may be obtained from the Internal Revenue Service. If "Applied For" is written in Part 1 and the Depositary is not provided with a TIN within 60 days of its receipt of the Substitute Form W-9, the Depositary will withhold 31% on all payments of the purchase price until a TIN is provided to the Depositary. Certain stockholders (including, among others, all corporations and certain foreign individuals) are not subject to these backup withholding and reporting requirements. In order for a foreign individual to qualify as an exempt recipient, such individual must submit an Internal Revenue Service Form W-8 or W-8BEN, signed under penalties of perjury, attesting to such individual's exempt status. A Form W-8 or Form W-8BEN can be obtained from the Depositary. See the enclosed Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9 for additional instructions. To prevent backup withholding on payments that are made to a shareholder with respect to Shares purchased pursuant to the Offer, the shareholder is required to notify the Depositary of such stockholder's correct TIN by completing the form below certifying that the TIN provided on Substitute Form W-9 is correct (or that such shareholder is awaiting a TIN), and that: (i) such stockholder is exempt from backup withholding; (ii) such stockholder has not been notified by the Internal Revenue Service that he is subject to backup withholding as a result of a failure to report all interest or dividends; or (iii) the Internal Revenue Service has notified such shareholder that such shareholder is no longer subject to backup withholding. See the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9" for additional instructions. 10. LOST, DESTROYED OR STOLEN CERTIFICATES. If any certificate(s) representing Shares has been lost, destroyed or stolen, the shareholder should promptly notify the Depositary. The shareholder will then be instructed as to the steps that must be taken in order to replace the certificate(s). This Letter of Transmittal and related documents cannot be processed until the procedures for replacing lost, destroyed or stolen certificates have been followed. To expedite replacement, call Continental Stock Transfer & Trust Company. 11. WAIVER OF CONDITIONS. The conditions to the Offer may be waived by the Company, in whole or in part, at any time and from time to time, in the Company's sole discretion. 12. ODD LOTS. As described in the Offer to Purchase, if the Company is to purchase fewer than all Shares validly tendered before the Expiration Date and not withdrawn, the Shares purchased first will consist of all Shares validly tendered by any stockholder who owned, beneficially or of record, as of the close of business on January 8, 2001, and as of the Expiration Date, an aggregate of fewer than 100 Shares and who validly tenders all of such holder's Shares. This preference will not be available unless the section captioned "Odd Lots" in this Letter of Transmittal is completed. -10- CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 SUBSTITUTE CERTIFICATION PAYER'S NAME: Continental Stock Transfer & Trust Company Part 1 - Please provide your TIN and certify by signing and dating below. Social Security Number or Employer Identification Number: ___________________________ Part 1(B) - Please check the box at the right if you have applied for and are awaiting receipt of your TIN or intend to apply for a TIN in the near future. [ ] Part 2 - For Payees Exempt From Backup Withholding, please write "Exempt" and see the enclosed Guidelines and complete as instructed therein. ____________________ Part 3 - Certification Under Penalties of Perjury, I certify that: Form W-9 of the Item (1) the number shown on this form is my correct Treasury Internal Taxpayer Internal Revenue Identification Number (or I am Revenue Special waiting for a number to be issued to me); Payer's Request for Taxpayer Item (2) I am not subject to backup withholding either Identification because: (a) I am exempt from backup Taxpayer withholding; ("TIN") (b) I have not been notified by the IRS that I am subject to backup withholding as a result of failure to report all interest or dividends; or (c) the IRS has notified me that I am no longer subject to withholding; and Item (3) I am a U.S. person (or a U.S. resident alien). CERTIFICATION INSTRUCTIONS--You must cross out item (2) above if you have been notified by the IRS that you are subject to backup withholding because of underreporting interest or dividends on your tax return. However, if after being notified by the IRS that you were subject to backup withholding you received another notification from the IRS that you are no longer subject to backup withholding, do not cross out item (2). (Also see instructions in the enclosed Guidelines.) The Internal Revenue Service does not require your consent to any provision of this document other than the certifications required to avoid backup withholding. Date: ____________, 2001 Signature:________________________ YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 1(B) OF THE SUBSTITUTE FORM W-9 INDICATING YOU HAVE APPLIED FOR, AND ARE AWAITING RECEIPT OF, YOUR TIN. I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and that I mailed or delivered an application to receive a taxpayer identification number to the appropriate Internal Revenue Service center or Social Security Administration Office (or I intend to mail or deliver an application in the near future). I understand that if I do not provide a taxpayer identification number to the payer, 31% of all payments made to me pursuant to this offer shall be retained until I provide a tax identification number to the payer and that, if I do not provide my taxpayer identification number within sixty (60) days, such retained amounts shall be remitted to the IRS as backup withholding and 31% of all reportable payments made to me thereafter will be withheld and remitted to the IRS until I provide a taxpayer identification number. __________________________________ ___________, 2001 Signature Date NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. FOR ADDITIONAL DETAILS, PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9. -11- EX-99.A3 4 0004.txt NOTICE OF GUARANTEED DELIVERY EXHIBIT (A)(3) NOTICE OF GUARANTEED DELIVERY FOR TENDER OF SHARES OF COMMON STOCK OF SONOMAWEST HOLDINGS, INC. (NOT TO BE USED FOR SIGNATURE GUARANTEES) This Notice of Guaranteed Delivery, or one substantially in the form hereof, must be used to accept the Offer (as defined below): (i) if certificates ("Share Certificates") evidencing shares of common stock, no par value (the "Shares"), of SonomaWest Holdings, Inc., a California corporation, are not immediately available; (ii) if Share Certificates and all other required documents cannot be delivered to Continental Stock Transfer & Trust Company as Depositary (the "Depositary"), prior to the Expiration Date (as defined in the Introduction to the Offer to Purchase (as defined below)); or (iii) if the procedure for delivery by book-entry transfer cannot be completed on a timely basis. This Notice of Guaranteed Delivery may be delivered by hand or mail or transmitted by facsimile transmission to the Depositary. See "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares" in the Offer to Purchase. The Depositary for the Offer is: Continental Stock Transfer & Trust Company 2 Broadway, 19th Floor New York, N.Y. 10004 Reorganization Department Telephone: 212-509-4000 x. 535 Fax: 212-616-7610 Attn: Roger Bernhammer Delivery of this Notice of Guaranteed Delivery to an address other than as set forth above, or transmission of instructions via facsimile transmission other than as set forth above, will not constitute a valid delivery. This form is not to be used to guarantee signatures. If a signature on a Letter of Transmittal is required to be guaranteed by an "eligible institution" under the instructions thereto, such signature guarantee must appear in the applicable space provided in the signature box on the Letter of Transmittal. -1- To the Depositary: The undersigned hereby tenders to SonomaWest Holdings, Inc., a California corporation, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated January 8, 2001 (the "Offer to Purchase"), and the related Letter of Transmittal (which, as amended or supplemented from time to time, together constitute the "Offer"), receipt of each of which is hereby acknowledged, the number of Shares specified below pursuant to the guaranteed delivery procedures described in "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares" in the Offer to Purchase. Number Shares:----------------------------------------------------------------- Certificate Nos. (if available):---------------------------------------------- [ ] Check box if Shares will be delivered by book-entry transfer to The Depositary Trust Company Account No.:------------------------------------------------------------------- - --------------------------------- - --------------------------------- Date:-------------------------, 2001 (Signature(s) of Holder(s)) Name(s) of Holder(s): --------------------------------------------------------- (Please Type or Print) Address:----------------------------------------------------------------------- Zip Code:---------------------------------------------------------------------- Area Code and Telephone No.:--------------------------------------------------- ODD LOTS: If the Shares being tendered by or on behalf of a person owning, beneficially or of record, as of the close of business on January 8, 2001, and who continues to own, beneficially or of record, as of the Expiration Date, an aggregate of fewer than 100 Shares, please complete the following: The undersigned certifies that the undersigned (check one box): [ ] was the beneficial or record owner of, as of the close of business on January 8, 2001 and continues to own, beneficially or of record as of the Expiration Date, an aggregate of fewer than 100 Shares, all of which are being tendered; or [ ] is a broker, dealer, commercial bank, trust company, or other nominee that: (i) is tendering, for the beneficial owner(s) hereof, Shares with respect to which it is the record holder and (ii) believes that, based upon representations made to it by such beneficial owner(s), that each such person was the beneficial or record owner of, as of the close of business on January 8, 2001 and continues to own, beneficially or of record as of the Expiration Date, an aggregate of fewer than 100 Shares, all of which are being tendered. -2- GUARANTEE (NOT TO BE USED FOR SIGNATURE GUARANTEE) The undersigned, a firm which is a member of a registered national securities exchange or of the National Association of Securities Dealers, Inc. or which is a commercial bank or trust company having an office or correspondent in the United States that is a member in good standing of the Securities Transfer Agent Medallion Program, the New York Stock Exchange Medallion Signature Guarantee Program or the Stock Exchange Medallion Program, guarantees to deliver to the Depositary, at one of its addresses set forth above, Share Certificates evidencing the Shares tendered hereby, in proper form for transfer, or confirmation of book-entry transfer of such Shares, into the Depositary's account at The Depositary Trust Company, in each case with delivery of a Letter of Transmittal (or facsimile thereof) properly completed and duly executed, with any required signature guarantees or an Agent's Message (as defined in the Offer to Purchase) in the case of book-entry delivery, and any other required documents, all within 3 trading days of the date hereof. The Eligible Institution that completes this form must communicate the guarantee to the Depositary and must deliver the applicable Letter of Transmittal and the certificates for Shares to the Depositary within the time period shown herein. Failure to do so could result in a financial loss to such Eligible Institution. Name of Firm:------------------------------------------------------------------ Authorized Signature:---------------------------------------------------------- Name:-------------------------------------------------------------------------- (Please Type or Print) Title:------------------------------------------------------------------------- Address: ---------------------------------------------------------------------- Zip Code:---------------------------------------------------------------------- Area Code and Telephone Number:------------------------------------------------ Dated: _______________________________, 2001 Do not send Share Certificates with this Notice of Guaranteed Delivery. Share Certificates should be sent to the Depositary with your Letter of Transmittal. -3- EX-99.A4 5 0005.txt OFFER TO PURCHASE EXHIBIT(A)(4) OFFER TO PURCHASE FOR CASH UP TO 375,000 SHARES OF SONOMAWEST HOLDINGS, INC. COMMON STOCK AT $8.00 NET PER SHARE BY SONOMAWEST HOLDINGS, INC. - ------------------------------------------------------------------------------- THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., PACIFIC TIME, ON FEBRUARY 15, 2001 UNLESS THE OFFER IS EXTENDED. - ------------------------------------------------------------------------------- To Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees: We are enclosing the material below in connection with the SonomaWest Holdings, Inc. (the "Company") offer to purchase of up to 375,000 shares of its common stock, no par value (the "Shares"), at a purchase price of $8.00 per Share, net to the seller in cash without interest thereon and subject to reduction for any federal backup or other withholding or stock transfer taxes, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated January 8, 2001, and the applicable Letter of Transmittal (which, as amended or supplemented from time to time, together constitute the "Offer"). Please furnish copies of the enclosed materials to those of your clients for whose accounts you hold Shares registered in your name or in the name of your nominee. Enclosed for your information and use are copies of the following documents: a. Offer to Purchase, dated January 8, 2001; b. Letter of Transmittal to be used by holders of Shares in accepting the Offer and tendering Shares; c. Notice of Guaranteed Delivery to be used to accept the Offer if the Shares and all other required documents are not immediately available or cannot be delivered to Continental Stock Transfer & Trust Company (the "Depositary") by the Expiration Date (as defined in the Offer to Purchase) or if the procedure for book-entry transfer cannot be completed by the Expiration Date; d. A letter which may be sent to your clients for whose accounts you hold Shares registered in your name or in the name of your nominee, with space provided for obtaining such clients' instructions with regard to the Offer; and e. Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9. WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 P.M., PACIFIC TIME, ON FEBRUARY 15, 2001 UNLESS THE OFFER IS EXTENDED. In all cases, payment for Shares accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of: (i) certificates evidencing such Shares (or a confirmation of a book-entry transfer of such Shares into the Depositary's account at the Book-Entry Transfer Facility (as defined in the Offer to Purchase)); (ii) the Letter of Transmittal (or facsimile(s) thereof) properly completed and duly executed or an Agent's Message (as defined in the Offer to Purchase) in connection with a book-entry delivery of Shares; and (iii) any other required documents. If a holder of Shares wishes to tender, but cannot deliver such holder's certificates or other required documents, or cannot comply with the procedure for book-entry transfer, prior to the expiration of the Offer, a -1- tender of Shares may be effected by following the guaranteed delivery procedure described in "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares" in the Offer to Purchase. Company will not pay any fees or commissions to any broker, dealer or other person (other than the Depositary as described in the Offer to Purchase) in connection with the solicitation of tenders of Shares pursuant to the Offer. However, Company will reimburse you for reasonable and necessary mailing and handling expenses incurred by you in forwarding any of the enclosed materials to your clients. Company will pay or cause to be paid any stock transfer taxes payable with respect to the transfer of Shares to it, except as otherwise provided in Instruction 6 of the Letter of Transmittal. Any inquiries you may have with respect to the Offer should be addressed to, and additional copies of the enclosed material may be obtained by contacting, the Company at its address and telephone numbers set forth on the back cover page of the Offer to Purchase. Very truly yours, SonomaWest Holdings, Inc. - ------------------------------------------------------------------------------- Nothing contained herein or in the enclosed documents shall authorize you or any other person to act on behalf of or as the agent of SonomaWest Holdings, Inc., or affiliate, or authorize you or any other person to use any document or to make any statement on behalf of any of them in connection with the Offer other than the enclosed documents and the statements contained therein. - ------------------------------------------------------------------------------- -2- EX-99.A5 6 0006.txt OFFER TO PURCHASE EXHIBIT(A)(5) OFFER TO PURCHASE FOR CASH UP TO 375,000 SHARES OF SONOMAWEST HOLDINGS, INC. COMMON STOCK AT $8.00 NET PER SHARE BY SONOMAWEST HOLDINGS, INC. - ------------------------------------------------------------------------------- THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., PACIFIC TIME, ON FEBRUARY 15, 2001 UNLESS THE OFFER IS EXTENDED. - ------------------------------------------------------------------------------- January 8, 2001 To Our Clients: Enclosed for your consideration are the Offer to Purchase dated January 8, 2001 (the "Offer to Purchase") and the Letter of Transmittal (which, as amended or supplemented from time to time, together constitute the "Offer") in connection with the Offer by SonomaWest Holdings, Inc., a California corporation (the "Company"), to purchase up to 375,000 shares of its common stock, no par value (the "Shares"), at a purchase price of $8.00 per Share net to the seller in cash without interest thereon and subject to reduction for any applicable federal backup or other withholding or stock transfer taxes, upon the terms and subject to the conditions set forth in the Offer. In the event more than 375,000 Shares are validly tendered and not withdrawn before the Expiration Date, the company will accept for payment, and thereby purchase, Shares, other than Odd Lots, on a pro rata basis upon the terms and subject to the conditions of the Offer. Shares not purchased because of proration will be returned at the Company's expense to the stockholders who tendered such Shares as soon as practicable after the Expiration Date. The Company reserves the right, in its sole discretion, to purchase more than 375,000 Shares pursuant to the Offer. Upon the terms and subject to the conditions of the Offer, if at the Expiration Date more than 375,000 Shares are validly tendered and not withdrawn, the Company will buy Shares first from any person who owned beneficially or of record as of the close of business on January 8, 2001 and who continues to own beneficially or of record as of the Expiration Date, an aggregate of fewer than 100 Shares and who validly tenders all their Shares, and then on a pro rata basis from all other stockholders who validly tender Shares (and do not withdraw such Shares prior to the Expiration Date). Holders of Shares whose certificates for such Shares (the "Share Certificates") are not immediately available, or who cannot deliver their Share Certificates and all other required documents to Continental Stock Transfer & Trust Company (the "Depositary") on or prior to the Expiration Date (as defined in the Offer to Purchase), or who cannot complete the procedures for book-entry transfer on a timely basis, must tender their Shares according to the guaranteed delivery procedures set forth in "THE OFFER - 3. Procedures for Accepting the Offer and Tendering Shares" in the Offer to Purchase. We are the holder of record (directly or indirectly) of Shares for your account. A tender of such Shares can be made only by us or our nominees as the holder of record and pursuant to your instructions. The enclosed Letter of Transmittal are furnished to you for your information only and cannot be used by you to tender Shares held by us for your account. Accordingly, we request instructions as to whether you wish to have us tender on your behalf any or all of the Shares held by us for your account, pursuant to the terms and conditions set forth in the Offer. Please note the following: 1. The tender price is $8.00 per Share, net to you in cash, without interest thereon, upon the terms and subject to the conditions set forth in the Offer. 2. The Offer is being made for up to 375,000 Shares. 3. Any stock transfer taxes applicable to the sale of Shares to the Company pursuant to the Offer will be paid by the Company, except as otherwise provided in Instruction 6 of the Letter of Transmittal. 4. The Offer, proration period and withdrawal rights will expire at 5:00 p.m., Pacific Time, on February 15, 2001, unless the Offer is extended. 5. Payment for Shares purchased pursuant to the Offer will in all cases be made only after timely receipt by the Depositary of: (i) Share Certificates or timely confirmation of the book-entry transfer of such Shares into the account maintained by the Book-Entry Transfer Facility (as described in the Offer to Purchase), pursuant to the procedures set forth in "THE OFFER - 3. Procedures for Accepting Offer and Tendering Shares" in the Offer to Purchase; (ii) the Letter of Transmittal (or a facsimile(s) thereof), properly completed and duly executed, with any required signature guarantees or an Agent's Message (as defined in the Offer to Purchase), in connection with a book-entry delivery; and (iii) any other documents required by the Letter of Transmittal. Accordingly, payment may not be made to all tendering stockholders at the same time, depending upon when Share Certificates or confirmations of book-entry transfer of such Shares into the Depositary's account at the Book-Entry Transfer Facility are actually received by the Depositary. 6. If (i) you owned beneficially or of record as of the close of business on January 8, 2001 and continue to own beneficially or of record as of the Expiration Date an aggregate of fewer than 100 Shares; (ii) you instruct us to tender on your behalf all such Shares prior to the Expiration Date; and (iii) you completed the section entitled "Odd Lots," the Company, upon the terms and subject to the conditions of the Offer, will accept all such Shares for purchase before proration, if any, of the purchase of other Shares validly tendered. If you wish to have us tender any or all of the Shares held by us for your account, please so instruct us by completing, executing, detaching and returning to us the instruction form set forth below. If you authorize the tender of your Shares, all such Shares will be tendered unless otherwise specified in your instructions. An envelope to return your instructions to us is enclosed. Your instructions should be forwarded to us in ample time to permit us to submit a tender on your behalf prior to the expiration of the Offer. If you do not instruct us to tender your Shares, they will not be tendered. The Offer is made solely by the Offer to Purchase and the related Letter of Transmittal and is being made to all holders of Shares. The Company is not aware of any state where the making of the Offer is prohibited by administrative or judicial action pursuant to any valid state statute. If the Company becomes aware of any valid state statute prohibiting the making of the Offer or the acceptance of the Shares pursuant thereto, the Company will make a good faith effort to comply with such statute or seek to have such statute declared inapplicable to the Offer. If, after such good faith effort, the Company cannot comply with such state statute, the Offer will not be made to (nor will tenders be accepted from or on behalf of) holders of Shares in such state. -2- INSTRUCTIONS WITH RESPECT TO THE OFFER TO PURCHASE FOR CASH UP TO 375,000 SHARES OF COMMON STOCK OF SONOMAWEST HOLDINGS, INC. BY SONOMAWEST HOLDINGS, INC. The undersigned acknowledge(s) receipt of your letter, the enclosed Offer to Purchase dated January 8, 2001 (the "Offer to Purchase") and the Letter of Transmittal (which, as amended or supplemented from time to time, together constitute the "Offer") in connection with the Offer by SonomaWest Holdings, Inc., a California corporation (the "Company"), to purchase up to 375,000 shares of its common stock, no par value (the "Shares"), at a purchase price of $8.00 per Share net to the seller in cash without interest thereon and subject to reduction for any applicable federal backup or other withholding or stock transfer taxes, upon the terms and subject to the conditions set forth in the Offer. This will instruct you to tender to the Company the number of Shares indicated below (or, if no number is indicated below, all Shares) which are held by you for the account of the undersigned, upon the terms and subject to the conditions set forth in the Offer. NUMBER OF SHARES TO BE TENDERED: _________________________ SHARES * Unless otherwise indicated, it will be assumed that you instruct us to tender all Shares held by us for your account. ODD LOTS [ ] By checking this box the undersigned represents that the undersigned owned beneficially or of record as of the close of business on January 8, 2001 and continues to own, beneficially or of record as of the Expiration Date, an aggregate of fewer than 100 Shares and is tendering all of such Shares. SIGN HERE NAME:---------------------------------------- ADDRESS:------------------------------------- ------------------------------------- SIGNATURE(S):-------------------------------- -------------------------------- -3- EX-99.A6 7 0007.txt LETTER EXHIBIT (A)(6) SONOMAWEST HOLDINGS, INC. 1448 Industrial Avenue o Sebastopol, CA 95472-4848 Ph: 707 824-2548 o Fax: 707 824-2545 -------------------------- January 8, 2001 To SonomaWest Holdings' Shareholders: We previously announced our intention to offer to purchase up to 375,000 shares of SonomaWest Holdings, Inc. stock from shareholders at $8.00 per share. Enclosed are the documents necessary for you to tender your shares in this offer. While the materials are self-explanatory and you should READ EVERYTHING before you make a decision, following is a summary of the offer. Until February 15, 2001 we will purchase up to 375,000 shares of our stock at $8.00 per share. Unless the offer is extended, payment will be made on February 19, 2001. We reserve the right to increase the number of shares repurchased and extend the closing date of the offer. If more than 375,000 shares are tendered we will accept 100% of all odd lots tendered (less than 100 shares) and prorate all others (100 shares or greater). You will receive the full $8.00 on all tendered shares accepted by us without any brokerage commission; however, your broker may assess a fee for handling any shares in "street name". Many SonomaWest shareholders purchased their shares when the Company was known as Vacu-dry Company and operated in a totally different line of business. Until mid-1999, Vacu-dry primarily was an industrial specialty drier of fruits. During our fiscal 2000 year ended June 30, 2000, we sold the core processed apple ingredients lines of business, sold our retail organic packaged foods division and discontinued or sold all other operations. Since then we have become a lessor of real estate (our former operations facilities) and committed $3 million to a venture capital investment in a telecommunications company that owns PCS (Personal Communication Service) licenses. We are making the tender offer because we feel it is in the best interests of the shareholders. SonomaWest has radically altered what it does. We have historically had low "float" (the number of shares actively traded) and a relatively large bid-ask spread. Until we announced on November 8, 2000 that we were considering a stock repurchase program, our stock usually traded in a range of $5.25 to $6.375 per share, less than some of us felt the Company was worth. This tender offer presents an opportunity for you to sell your shares in this changed company without commissions. Neither the Board of Directors nor the Company is making a recommendation to you as to whether or not you should tender any or all of your shares. We have truly appreciated your confidence and support during this period of transition. Sincerely, Gary L. Hess President and Chief Executive Officer EX-99.A7 8 0008.txt GUIDELINES EXHIBIT (A)(7) GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 I. GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE PAYER Social Security Numbers have nine digits separated by two hyphens (i.e. , 000-00-0000). Employer Identification Numbers have nine digits separated by only one hyphen (i.e., 00-0000000). The table below will help determine the number to give the payer. You must enter your TIN in the appropriate box. If you are a resident alien and you do not have and are not eligible to get an SSN, your TIN is your IRS individual taxpayer identification number ("ITIN"). Enter it in the social security number box. If you do not have an ITIN, see HOW TO GET A TIN below. If you are a sole proprietor and you have an EIN, you may enter either your SSN or EIN. However, using your EIN may result in unnecessary notices to the person requesting your TIN.
GIVE THE TAXPAYER FOR THIS TYPE OF ACCOUNT: IDENTIFICATION NUMBER OF: - ------------------------ ------------------------ 1. An individual's account The individual 2. Two or more individuals (joint account) The actual owner of the account or, if combined funds, the first individual on the account *(a) 3. Custodian account of a minor (Uniform Gift to Minors Act) The minor *(b) 4. a. The usual revocable savings trust account The grantor - trustee *(a) (grantor is also trustee) b. So-called trust account that is not a legal or valid The actual owner *(a) trust under State law 5. Sole proprietorship account The owner *(c) 6. A valid trust, estate, or pension trust The legal entity (Do not furnish the identifying number of the personal representative or trustee unless the legal entity itself is not designated in the account title.) *(d) 7. Corporate account The corporation 8. Religious, charitable, or educational organization account The organization 9. Partnership The partnership 10. Association, club, or other tax-exempt organization The organization 11. A broker or registered nominee The broker or nominee 12. Account with the Department of Agriculture in the name of a The public entity public entity (such as a State or local government, school district, or prison) that receives agricultural program payments
- ---------------------------------------------------------------- *(a) List first and circle the name of the person whose number you furnish. *(b) Circle the minor's name and furnish the minor's social security number. *(c) Show the name of the owner. You may also enter your business name. You may use your Social Security or Employer Identification Number. *(d) List first and circle the name of the legal trust, estate, or pension trust. NOTE: If no name is circled when there is more than one name, the number will be considered to be that of the first name listed. II. PURPOSE OF FORM. A person who is required to file an information return with the IRS must get your correct TIN to report, for example, income paid to you, real estate transactions, mortgage interest you paid, the acquisition or abandonment of secured property, cancellation of debt, or contributions you made to an IRA. Use Form W-9 to give your correct TIN to the person requesting your TIN and, when applicable, (1) to certify the TIN you are giving is correct (or you are waiting for a number to be issued), (2) to certify you are not subject to backup withholding, or (3) to claim exemption from backup withholding if you are an exempt payee. NOTE: If a requester gives you a form other than a W-9 to request your TIN, you must use the requester's form if it is substantially similar to Form W-9. III. WHAT IS BACKUP WITHHOLDING? Persons making certain payments to you must withhold and pay to the IRS 31% of such payments under certain conditions. This is called "backup withholding." Payments that could be subject to backup withholding include interest, dividends, broker and barter exchange transactions, rents, royalties, nonemployee pay, and certain payments from fishing boat operators. Real estate transactions are not subject to backup withholding. If you give the requester your correct TIN, make the proper certifications, and report all your taxable interest and dividends on your tax return, payments you receive will not be subject to backup withholding. Payments you receive will be subject to backup withholding if: 1. You do not furnish your TIN to the requester, or 2. The IRS tells the requester that you furnished an incorrect TIN, or 3. The IRS tells you that you are subject to backup withholding because you did not report all your interest and dividends on your tax return (for reportable interest and dividends only), or 4. You do not certify to the requester that you are not subject to backup withholding under 3 above (for reportable interest and dividend accounts opened after 1983 only), or 5. You do not certify your TIN. Certain payees and payments are exempt from backup withholding and information reporting. See below. IV. OBTAINING A NUMBER If you don't have a taxpayer identification number or you do not know your number, obtain Form SS-5, Application for a Social Security Number Card, or Form SS-4, Application for Employer Identification Number, at the local office of the Social Security Administration or the Internal Revenue Service and apply for a number. V. PAYEES EXEMPT FROM BACKUP WITHHOLDING Payees specifically exempted from backup withholding on ALL payments include the following: o A corporation. o A financial institution. o An organization exempt from tax under Section 501(a) (all Section references refer to the Internal Revenue Code of 1986, as amended), or an individual retirement plan. o The United States or any agency or instrumentality thereof. o A State, the District of Columbia, a possession of the United States, or any subdivision or instrumentality thereof. o A foreign government, a political subdivision of a foreign government, or any agency or instrumentality thereof. o An international organization or any agency, or instrumentality thereof. o A registered dealer in securities or commodities registered in the U.S. or a possession of the U.S. o A real estate investment trust. o A common trust fund operated by a bank under Section 584(a). o An exemption charitable remainder trust, or a non-exempt trust described in Section 4947(a)(1). o An entity registered at all times under the Investment Company Act of 1940. -2- o A foreign central bank of issue. VI. PAYMENTS EXEMPT FROM BACKUP WITHHOLDING Payments of dividends and patronage dividends not generally subject to backup withholding include the following: o Payments to nonresident aliens subject to withholding under Section 1441. o Payments to partnerships not engaged in a trade or business in the U.S. and which have at least one nonresident partner. o Payments of patronage dividends where the amount received is not paid in money. o Payments made by certain foreign organizations. Payments of interest not generally subject to backup withholding include the following: o Payments of interest on obligations issued by individuals. Note: You may be subject to backup withholding if this interest is $600 or more and is paid in the course of the payer's trade or business and you have not provided your correct taxpayer identification number to the payer. o Payments of tax-exempt interest (including exempt-interest dividends under Section 852). o Payments described in Section 6049(b)(5) to nonresident aliens. o Payments on tax-free covenant bonds under Section 1451. o Payments made by certain foreign organizations. Exempt payees described above should file Form W-9 to avoid possible erroneous backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER IDENTIFICATION NUMBER OR IF EXEMPT, WRITE "EXEMPT" ON THE FACE OF THE FORM, AND RETURN IT TO THE PAYER AND SIGN AND DATE THE FORM. Certain payments other than interest dividends, and patronage dividends, that are not subject to information reporting are also not subject to backup withholding. For details, see the regulations under Sections 6041, 6041A(a), 6045, and 6050A. PRIVACY ACT NOTICE. Section 6109 requires most recipients of dividend, interest, or other payments to give taxpayer identification numbers to payers who must report the payments to IRS. IRS uses the numbers for identification purposes. Payers must be given the numbers whether or not recipients are required to file tax returns. Payers must generally withhold 31% of taxable interest, dividend, and certain other payments to a payee who does not furnish a taxpayer identification number to a payer. Certain penalties may also apply. VII. PENALTIES o PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER. If you fail to furnish your taxpayer identification number to a payer, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect. o CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING. If you make a false statement with no reasonable basis which results in no imposition of backup withholding, you are subject to a penalty of $500.00. o CRIMINAL PENALTY FOR FALSIFYING INFORMATION. Falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment. o MISUSE OF TINS. If the requester discloses or uses TINs in violation of Federal law, the requester may be subject to civil and criminal penalties. FOR ADDITIONAL INFORMATION, CONTACT YOUR TAX ADVISOR OR THE INTERNAL REVENUE SERVICE. -3- EX-99.A8 9 0009.txt NEWS RELEASE EXHIBIT (A)(8) January 8, 2001 NEWS RELEASE Contact: Gary L. Hess, President 707/824-2548 Headline: SonomaWest Holdings Announces Tender Offer For Its Common Stock SEBASTOPOL, CALIFORNIA...................... SonomaWest Holdings, Inc. (NASDAQ: SWHI, formerly Vacu-dry Company, the "Company"), today announced that it will commence a fixed price tender offer for 375,000 shares of its common stock, at $8.00 per share net. If more than 375,000 shares are tendered, the Company will purchase shares first from stockholders who own less than 100 shares of the Company's common stock and then from each other tendering stockholder on a pro rata basis. Under the terms of the offer, stockholders will have the opportunity to tender all or a portion of their shares at $8.00 per share. All other shares that have been tendered and not purchased will be promptly returned to the stockholders. The tender offer will expire on February 15, 2001 at 5:00 p.m., Eastern time, unless the Company elects to extend the offer. The offer is subject to various conditions described in the Offer to Purchase. The Company's Board of Directors has approved the offer. However, neither the Company nor its Board of Directors is making any recommendation to its stockholders as to whether to tender or refrain from tendering their shares. Stockholders must make their own decisions as to whether to tender their shares and if so, how many shares to tender. This press release is for informational purposes only and is not an offer to buy or the solicitation of an offer to sell any shares of the Company's common stock. The solicitation of an offer to buy the Company's common stock will only be made pursuant to the Offer to Purchase and related material that the Company will be sending out to its stockholders shortly. Stockholders should read those materials carefully because they will contain important information including the various terms and conditions to the offer. This Press Release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements made with respect to the potential terms of the proposed self-tender offer. Words such as "plan," "will," "anticipate," "intend," "increasing," "pursue," "provide," "begin," "should," "would," "focus," "believe," "expect," "continue," and "plan," or the negative thereof or variations thereon and similar expressions are intended to identify forward-looking statements. These forward-looking statements inherently involve certain risks and uncertainties, although they are based on our current plans or assessments that are believed to be reasonable as of the date of this Press Release. Factors that may cause actual results, goals, targets or objectives to differ materially from those contemplated, projected, forecast, estimated, anticipated, planned or budgeted in such forward-looking statements include, among others, the following possibilities: (i) an inability to launch or complete the proposed tender offer (including a determination by the Company not to pursue such tender offer or to change the amount of such tender offer); (ii) changes in the Company's stock price; or (iii) changes in the Company's operating results. Actual events or results may differ materially from those discussed, contemplated, forecasted, estimated, anticipated, planned or implied in the forward-looking statements as a result of the various factors described above and those further set forth in the Company's Schedule TO filed with the Securities & Exchange Commission, in the Company's Quarterly Report on Form 10-Q filed with the Securities & Exchange Commission on November 13, 2000 and in the Company's Form 10-K filed with the Securities and Exchange Commission on September 25, 2000. ****END**** -----END PRIVACY-ENHANCED MESSAGE-----