EX-7.03 2 ex7_03.txt EXHIBIT 7.03 Exhibit 7.03 On March 21, 2007, a document was posted on the Teamsters.org Web site titled "TDU Backs Hugh Sawyer/Rutland Family Over Yucaipa Proposal" (the "Leaflet"). This "Leaflet" purports to provide a "comparison of the terms in the Yucaipa and Sopris plans." The Leaflet contains a series of false and misleading statements. What follows is a summary of some of the major misrepresentations in the Leaflet along with the relevant facts to correct the false and misleading statements.
------------------------- ------------------------------------------------- ------------------------------------------------------ Issue Leaflet Statement The Facts ------------------------- ------------------------------------------------- ------------------------------------------------------ Plan Support "What they aren't telling you is that the The Sopris Plan is NOT backed by Hugh Sawyer and the Sopris proposal is backed by Hugh Sawyer and Rutland Family. It is backed by an investment fund the Rutland Family!" known as Sopris Partners, Series A of Sopris Capital Partners, L.P. Hugh Sawyer and the Rutland Family are currently on the Allied Board of Directors. This is the same Board that voted to support the Yucaipa Plan (NOT the Sopris Plan), and the same Board that has been rebuffing Sopris at every turn. To somehow equate the Sopris Plan with a Hugh Sawyer / Rutland Family Proposal is simply wrong! If Hugh Sawyer and the Rutland Family were truly backing the Sopris Plan, then the Company would not be a partner with Yucaipa trying to pursue the Yucaipa Plan. ------------------------- ------------------------------------------------- ------------------------------------------------------ New Management "No promise of new management; the current The Sopris Plan never indicated that current owners owners would stay in place (including the would stay in place. In fact, Sopris would be the Rutland Family) and can keep the same new majority owner and would elect a new Board of management." Directors. This new Board is expected to hire a new management team, including a new CEO who would replace Hugh Sawyer. If you go to page 5 of the Sopris Plan, in Section C titled "New Board of Directors and Management," you will discover the truth. ------------------------- ------------------------------------------------- ------------------------------------------------------ Ownership and Control "Existing shareholders, including the Rutland Existing shareholders would only keep 10% of the new family and other investors, will keep ownership equity in Allied and if they want, they can purchase and control of Allied, together with Sopris. in the aggregate up to an additional 39% of the new This is the same group that hired Hugh Sawyer equity in Allied. Sopris will be the new majority and supervised management over the past several owner, not existing shareholders. Sopris, not the years." Rutland Family, will be in control and have the power to correct previous owners' mistakes. The Sopris Plan offers Teamsters employees 101,010 "Sopris is dangling the prospect of the shares of the new equity in Allied and 10-year Teamsters union getting 100,000 shares of warrants to purchase up to 819,001 shares. This Allied stock, but this is only 1% of the total, means Teamsters employees could own about 8.5% of that is, a token amount. The stock may be the new Allied. THIS IS NOT A TOKEN AMOUNT; THIS IS worthless under their plan, which has not been A SIGNIFICANT STAKE. sanctioned by the Bankruptcy Court." No plan has been sanctioned by the Bankruptcy Court "...the Sopris proposal is backed by Hugh Sawyer yet, including the Yucaipa Plan. and the Rutland Family!" Unlike Yucaipa who believes Allied's equity is worthless, Sopris believes each Teamsters employee has worked very hard to create a valuable company with equity value today. Don't let Yucaipa steal what you have worked hard to create - remember Yucaipa will take 100% of the new equity and will NOT share any of this upside with you. Track record of saving members' jobs?! Why then does Yucaipa want to sell Allied Canada to PTS? If Allied Canada is sold to PTS, that will likely mean "Yucaipa is a union-friendly company with a less Allied U.S. work and that means layoffs. This track record of working with unions to save does not seem like a "union-friendly" strategy to members' jobs at distressed companies." us. Sopris does not intend to sell Allied Canada, as we believe a North America footprint (U.S. and Canada) puts Allied in a better competitive position. ------------------------- ------------------------------------------------- ------------------------------------------------------
1
------------------------- ------------------------------------------------- ------------------------------------------------------ Issue Leaflet Statement The Facts ------------------------- ------------------------------------------------- ------------------------------------------------------ "Under the Sopris plan, Allied is crushed under First of all, the Sopris Plan is a fully-funded plan New Debt the weight of massive new debt - about $400 which includes committed financing to pay for the Million. Potentially, this could lead to a much needed new rigs. Under the Sopris Plan, there second Allied bankruptcy in the future. " will be new debt AND NEW EQUITY. "Why? Because the Sopris plan lets stockholders The new debt issued to old creditors under the keep their equity, which means that creditors Sopris Plan does not require Allied to make cash have to be paid in full." interest payments for up to 7 years unless Allied is succeeding and certain financial tests are met (and under all circumstances requires no interest for the first two years). In addition, the Sopris exit financing does not require Allied to make cash interest payments for the first three years, during which time Allied will upgrade and renew the fleet. Simply put, the Sopris Plan requires NO cash interest for at least the first two years, potentially significantly longer. By contrast, the Yucaipa Plan will require at least $25 million per year in cash interest for the first three years. This will be required to service at least $315 million in new debt being put on Allied under the Yucaipa Plan. It is under the Yucaipa Plan that the company may be crushed under the weight of massive debt service requirements. Under the Sopris plan, the company will be self-sustaining and would not need to raise additional financing in the future to fund the projected fleet upgrade program. ------------------------- ------------------------------------------------- ------------------------------------------------------ Labor Concessions "Sopris wants EXACTLY the same concessions - Sopris has and is offering a better deal than 15% for three years, capped at $35 Million." Yucaipa - plain and simple. Sopris does not want the EXACT same concessions. We think Teamsters "No one, repeat, NO ONE, has ever offered a employees can do much better! Yucaipa wants better deal than this." Teamsters employees to give up $35 million every year for three years. We have proposed only $30 million, $5 million less every year for three years. This equates to an average improvement of $1,351 in higher wages per year for each Teamster employee! This is more money for you than the Yucaipa Plan! In addition, Sopris proposes to give equity to the Teamsters as well. Sopris recognizes that the Teamsters are critical to the success of Allied and therefore is pleased to have the employees share in Allied's future success through equity ownership in Allied. ------------------------- ------------------------------------------------- ------------------------------------------------------ Exit Financing "Is it true, as TDU claims, that Sopris will This is the WRONG WEBSITE! The website mentioned is invest $100 Million in Allied?" for Sopris Partners LLC. We are Sopris Partners, Series A of Sopris Capital Partners, L.P. - there is "Go to the Sopris website and click on ABSOLUTELY NO relationship between the two "investment criteria." Sopris says "We companies. This is incorrect and insulting to generally invest between $1 million and $5 Teamsters employees. Why would the Teamsters million in the equity of companies." So where national campaign organizers direct Teamsters did TDU get the $100 Million figure from?" employees to the wrong website?! Either they could not find correct information and do not check their "Why doesn't Yucaipa's plan provide for "exit work, and/or they deliberately want to mislead financing?" It does. Look on page 38 of the Teamsters and misrepresent who Sopris is in hopes of plan Yucaipa has filed with the court, under deceiving you to vote in favor of the Yucaipa Plan! the heading, "Exit financing." Under Yucaipa's plan, Allied will emerge with less total debt As a matter of fact, if the Sopris Plan is accepted, than under Sopris' plan." Sopris LP will invest much more than $100 million. Sopris has committed $345 million in new capital to "Yucaipa is committed to investing enough money its plan, whereas Yucaipa has committed zero new into Allied to get you new rigs." capital to its plan. ------------------------- ------------------------------------------------- ------------------------------------------------------ On New Management "From page 5 of the Sopris term sheet, it says To quote the Sopris Plan Term Sheet verbatim: - "Members of senior management shall continue "Members of senior management shall continue to to serve..."" serve until the Effective Date." The Effective Date is the day on which Allied comes out of bankruptcy. Do not let incomplete sentences mislead you. Hear the facts, not a misleading spin on them. ------------------------- ------------------------------------------------- ------------------------------------------------------
2 A vote on a labor proposal is a significant decision. Teamsters considering a vote on the Yucaipa proposal should do so knowing the facts. Do not be misled with false statements. Sopris has offered the Teamsters a better concession package, which includes more dollars in Teamster pockets (over $1,350 more per year per Teamster), and includes an equity stake (up to 8.5%) in the new Allied so Teamsters can share in the future success of the company (remember Yucaipa gives zero equity to Teamsters). There is one statement from the Leaflet we can agree with, which is "Vote Your Common Sense." 3