-----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, JJzk+A+5SrtsUwiO1iJrvw7YM8dA/CC88NGyBWHTX5sDnjn8mONMT471fyNazPoX 6zYM2rCZLeG+9NTh+19a1g== 0000890163-97-000022.txt : 19970313 0000890163-97-000022.hdr.sgml : 19970313 ACCESSION NUMBER: 0000890163-97-000022 CONFORMED SUBMISSION TYPE: DEFA14A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19970312 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: EASTERN CO CENTRAL INDEX KEY: 0000031107 STANDARD INDUSTRIAL CLASSIFICATION: CUTLERY, HANDTOOLS & GENERAL HARDWARE [3420] IRS NUMBER: 060330020 STATE OF INCORPORATION: CT FISCAL YEAR END: 1230 FILING VALUES: FORM TYPE: DEFA14A SEC ACT: 1934 Act SEC FILE NUMBER: 000-00599 FILM NUMBER: 97554912 BUSINESS ADDRESS: STREET 1: 112 BRIDGE ST STREET 2: P O BOX 460 CITY: NAUGATUCK STATE: CT ZIP: 06770 BUSINESS PHONE: 2037292255 MAIL ADDRESS: STREET 1: 112 BRIDGE STREET STREET 2: P O BOX 460 CITY: NAUGATUCK STATE: CT ZIP: 06770 DEFA14A 1 SCHEDULE 14A INFORMATION Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 Filed by the Registrant [ ] Filed by a Party other than the Registrant [ ] Check the appropriate box: [ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) [ ] Definitive Proxy Statement [x] Definitive Additional Materials [ ] Soliciting Material Pursuant to section 240.14a-11(c) or section 240.14a-12 EASTERN ............................................................................... (Name of Registrant as Specified In Its Charter) ............................................................................... (Name of Person(s) Filing Proxy Statement if Other than the Registrant) Payment of Filing Fee (Check the appropriate box): [ ] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2). [ ] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-6(i)(3). [ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. 1) Title of each class of securities to which transaction applies: 2) Aggregate number of securities to which transaction applies: 3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): 4) Proposed maximum aggregate value of transaction: 5) Total fee paid: [X] Fee previously paid with preliminary materials. [ ] Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing. 1) Amount Previously Paid: ..................................................................... 2) Form, Schedule or Registration Statement No.: ..................................................................... 3) Filing Party: ..................................................................... 4) Date Filed: ..................................................................... THE EASTERN COMPANY - -------------------------------------------------------------------------------- March 12, 1997 Dear Fellow Shareholder: As we have previously written to you, millionaire politician John S. Dyson and his affiliates, Millbrook Capital Management Inc. and MMI Investments, L.L.C., are trying to elect their nominees to Eastern's Board in order to put your Company up for sale. Dyson and his group still have on the table a hostile, highly leveraged offer to acquire Eastern at $15 per share--little more than the recent market price of Eastern shares. Don't give Dyson your share of Eastern's future value at a lowball price. THE EASTERN TURNAROUND IS FOR REAL! ALL SHAREHOLDERS, NOT JUST DYSON, SHOULD SHARE IN IT Management's strategic planning is producing results. After the anticipated difficulties in First Quarter 1996 caused by downturns in two of our major markets, normal operating profits (before deducting the costs of thwarting Dyson's hostile takeover attempt) have steadily improved, as demonstrated by the following chart: THE EASTERN COMPANY 1996 QUARTERLY NORMAL OPERATING PROFITS PER SHARE(1) First Quarter Second Quarter Third Quarter Fourth Quarter Net Income Per Share -0.07 0.13 0.22 0.24 Management is confident that this trend will continue in 1997. This is not the time to sell the Company, just as we are beginning to see results. We believe that putting Eastern on the block now, as Dyson wants, would only deprive you of the future value of your investment! 112 BRIDGE STREET, P.O. BOX 460, NAUGATUCK, CONNECTICUT 06770-0460 PHONE (203) 729-2255 * FAX (203) 723-8653 YOUR DIRECTORS BACK THEIR BELIEF IN THE TURNAROUND WITH THEIR WALLETS--THEY WANT TO BE PAID IN EASTERN STOCK, NOT CASH ! Unlike the Dyson/MMI nominees, your Board (seven of whom are not Eastern officers) is not affiliated with any would-be purchaser of the Company. Board members and executive officers own more than 11% of Eastern's stock. Our executives and directors have put their money where their mouths are by buying over 44,000 shares for their personal accounts since the beginning of this year. Their interests lie in a successful future for the Company and the maximization of value for all shareholders. Your Board has backed its belief in Eastern's turnaround with its own wallet. Our proposal to pay non-employee directors with Eastern stock, rather than cash, is the true measure of the Board's confidence in Eastern's future. KEEP THE FOX OUT OF THE CHICKEN COOP Dyson/MMI would have you believe that the Dyson nominees, if elected, would not necessarily try to sell Eastern to themselves. But they certainly would have a strong incentive to do so. Buying and selling companies is what Millbrook does for a living. REMEMBER, THE DYSON/MMI GROUP HAS NEVER WITHDRAWN ITS HOSTILE OFFER FOR EASTERN. You should also remember that Mr. Dyson cost the Company substantial expense and reduced earnings by his attempt to call a Special Meeting in violation of Connecticut law. THE CONNECTICUT SUPERIOR COURT, WHICH FOUND THAT MILLBROOK'S "INTENTION [WAS] TO CONTROL THE BOARD AND FORCE APPROVAL OF ITS MERGER PROPOSAL", RULED MILLBROOK'S REQUEST TO CALL A SPECIAL MEETING INVALID. DO YOU REALLY BELIEVE DYSON'S EXPENSIVE ACTIONS WERE IN YOUR BEST INTERESTS THEN? ARE THESE THE KIND OF PEOPLE YOU WANT ON YOUR BOARD NOW? YOUR VOTE IS IMPORTANT-- SEND IN THE WHITE PROXY CARD TODAY! We urge you to reject the Dyson/MMI group's continuing efforts to take control of your Company. Discard any blue proxy card from Dyson/MMI. INSTEAD, PROTECT YOUR INVESTMENT IN EASTERN'S FUTURE BY SIGNING, DATING AND RETURNING THE ENCLOSED WHITE PROXY CARD TODAY. Even if you have already returned a blue proxy card, for any reason, there is still time to change your vote by signing, dating and returning the enclosed WHITE proxy card. Remember, only your latest dated proxy card counts. Thank you for your continuing support. On behalf of the Board of Directors, Stedman G. Sweet President & Chief Executive Officer - ------------------------------------------------------------------------------- IF YOU HAVE ANY QUESTIONS, OR NEED ASSISTANCE IN VOTING YOUR SHARES, PLEASE CALL GEORGESON & COMPANY INC., WHO IS ASSISTING US IN THE SOLICITATION OF PROXIES, TOLL-FREE AT 1-800-223-2064. INTERNET: HTTP://WWW.GEORGESON.COM - ------------------------------------------------------------------------------- ADDITIONAL TRANSACTIONS Ole K. Imset, a director of the Company, acquired 108 shares on December 16, 1996 as payment for 4th quarter 1996 director fees. Donald S. Tuttle, III, a director of the Company, acquired 213 shares on December 16, 1996 as payment for 4th quarter 1996 director fees; acquired 2,000 shares on February 24, 1997 through exercise of option at $9.08 per share; and acquired 1,000 shares on February 21, 1997 at $13.375 per share. Raymond L. Wright, a Vice President of the Company owning 20,605 shares, acquired 5,000 shares of restricted stock on December 12, 1996 on December 16, 1996 at no cost; restrictions to lift upon achieving certain performance goals. Mr. Wright may also solicit proxies. ------------------------------ 1. Quarter results reflect income before deducting the costs of defending the Company from Millbrook's takeover attempt. Fourth quarter results reflect earnings before the year-end abnormal adjustment to estimated accruals described on p.23 of the 1996 Annual Report. In 1996, such adjustments for continuing operations decreased income by $0.02 per share. - ------------------------------------------------------------------------------- PROTECT YOUR INVESTMENT! DISCARD ANY BLUE PROXY CARD YOU MAY RECEIVE FROM THE DYSON/MMI GROUP INSTEAD--SIGN, DATE AND RETURN THE ENCLOSED WHITE PROXY CARD TODAY! - ------------------------------------------------------------------------------- QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING Q: WHO IS "MMI INVESTMENTS, L.L.C."? A: MMI Investments, L.L.C. is the personal holding company of millionaire politician John S. Dyson. Dyson's business is buying and selling companies for a profit-- which explains to us why Dyson wants to buy Eastern and pay as little as possible. Q: WHY IS DYSON TRYING TO REPLACE THREE OF EASTERN'S DIRECTORS? A: Dyson claims we wants to "maximize the value of our mutual investment"-- but he is also seeking to buy the Company. As a would-be buyer, doesn't Dyson want to pay a low price? We believe Dyson wants his hand-picked nomines to help him buy Eastern on the cheap -- depriving shareholders like you of the true value of the Company. Q: WHAT SHOULD I DO IF I GET A BLUE PROXY CARD FROM MMI? A: Throw it in the trash! Sign only WHITE proxy cards. Your vote on a blue card--even if you withhold on MMI directors in protest--helps Dyson because it revokes your previous vote on the WHITE card. Q: WHAT SHOULD I DO IF I ALREADY MAILED IN A BLUE CARD? A: Please sign, date and return the enclosed WHITE card today. A later-dated WHITE card will revoke any blue card you sent in earlier. Q: WHAT SHOULD I DO IF MY SHARES ARE HELD THROUGH A BANK OR BROKERAGE FIRM? A: If your shares are held through a bank or brokerage firm, only that firm can execute a proxy card on your behalf. Please contact the person responsible for your account and give instructions for a WHITE proxy card to be voted FOR PROPOSALS 1-3 and AGAINST PROPOSAL 4. Q: HOW CAN I PROTECT MY INVESTMENT IN EASTERN FROM DYSON'S SCHEME? A: Your directors are committed to protecting your interests. Support them by signing, dating and returning the enclosed WHITE proxy card today. Q: WHO CAN I CALL FOR FURTHER INFORMATION, OR IF I NEED HELP VOTING MY SHARES? A: Please call Georgeson & Company Inc., the company assisting us in the solicitation, toll-free at 1-800-223-2064. -----END PRIVACY-ENHANCED MESSAGE-----