GARAN, INCORPORATED
Offer To Purchase For Cash Up To
700,000 Shares Of Its Common Stock
(Including the Associated Common Stock Purchase Rights)
At A Purchase Price Not In Excess Of $30
Nor Less Than $26 Net Per Share
--------------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON
WEDNESDAY, JUNE 6, 2001, UNLESS THE OFFER IS EXTENDED.
--------------------------------------------------------------------------------
To Our Clients:
Enclosed for your consideration are the Offer to Purchase, dated May 4, 2001
("Offer to Purchase"), and the related Letter of Transmittal (which together
constitute the "Offer") in connection with the Offer by Garan, Incorporated, a
Virginia corporation ("Company"), to purchase up to 700,000 shares of its Common
Stock, including the associated Common Stock Purchase Rights ("Shares"), at a
price not in excess of $30 nor less than $26 net per Share, specified by
tendering shareholders, upon the terms and subject to the conditions set forth
in the Offer.
The Company will determine the single per Share price, not in excess of
$30 nor less than $26, net to the seller in cash ("Purchase Price") that it
will pay for Shares properly tendered pursuant to the Offer, taking into
account the number of Shares so tendered and the prices specified by
tendering shareholders. The Company will select the lowest Purchase Price
that will allow it to buy 700,000 Shares (or such lesser number of Shares as
are properly tendered). All Shares acquired in the Offer will be acquired at
the Purchase Price. All Shares properly tendered at prices at or below the
Purchase Price and not withdrawn will be purchased at the Purchase Price upon
the terms and subject to the conditions of the Offer, including the proration
and conditional tender provisions. Shares tendered at prices in excess of the
Purchase Price, Shares not purchased because of proration or conditional
tender, and Shares withdrawn pursuant to the Offer, will be returned. The
Company reserves the right, in its sole discretion, to purchase more than
700,000 Shares pursuant to the Offer. See Sections 1 and 15 of the Offer to
Purchase.
If, prior to the Expiration Date (as defined in the Offer to Purchase),
more than 700,000 Shares (or such greater number of Shares as the Company may
elect to purchase) are properly tendered and not withdrawn, the Company, upon
the terms and subject to the conditions of the Offer, will accept Shares for
purchase first from Odd Lot Holders (as defined in the Offer to Purchase) who
properly tender their Shares at or below the Purchase Price and then on a pro
rata basis from all other shareholders whose Shares are properly tendered at
or below the Purchase Price and not withdrawn. If any shareholder tenders
Shares and does not wish to have such Shares subject to proration, such
shareholder may tender Shares subject to the condition that a specified
minimum number of Shares (which may be represented by designated stock
certificates) or none of such Shares be purchased. See Sections 1, 3 and 6 of
the Offer to Purchase.
We are the owner of record of Shares held for your account. As such, we
are the only ones who can tender and then only pursuant to your instructions.
WE ARE SENDING YOU THE LETTER OF TRANSMITTAL FOR YOUR INFORMATION ONLY; YOU
CANNOT USE IT TO TENDER SHARES WE HOLD FOR YOUR ACCOUNT.
Please instruct us as to whether you wish us to tender any or all of the
Shares we hold for your account on the terms and subject to the conditions of
the Offer.
We call your attention to the following:
1. You may tender Shares at prices not in excess of $30 nor less than $26
net per Share as indicated in the attached Instruction Form, net to you in
cash.
2. You may condition your tender of Shares on the Company purchasing all
or a minimum number of your Shares.
3. You may designate the priority in which your Shares shall be purchased
in the event of proration.
4. The Offer is not conditioned upon any minimum number of Shares being
tendered.
5. The Offer and withdrawal rights will expire at 5:00 P.M, New York City
time, on Wednesday, June 6, 2001, unless the Company extends the Offer.
6. The Offer is for 700,000 Shares, constituting approximately 13.8% of
the Shares outstanding as of April 30, 2001.
7. Tendering shareholders will not be obligated to pay any brokerage
commissions to the Information Agent or the Depositary (as identified in
the Offer to Purchase), solicitation fees or, subject to Instruction 7 of
the Letter of Transmittal, any stock transfer taxes on the Company's
purchase of Shares pursuant to the Offer.
8. If you beneficially hold an aggregate of fewer than 100 Shares and you
instruct us to tender on your behalf all such Shares at or below the
Purchase Price before the Expiration Date (as defined in the Offer to
Purchase) and check the box captioned "Odd Lots" in the attached
Instruction Form, 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 properly tendered at or
below the Purchase Price.
9. If you wish to tender portions of your Shares at different prices, you
must complete a separate Instruction Form for each price at which you wish
to tender each such portion of your Shares. We must submit separate
Letters of Transmittal on your behalf for each price you will accept.
If you wish to have us tender any or all of your Shares, please so
instruct us by completing, executing, detaching, and returning to us the
attached Instruction Form. An envelope to return your Instruction Form to us
is enclosed. If you authorize us to tender your Shares, we will tender all
such Shares unless you specify otherwise on the attached Instruction Form.
YOUR INSTRUCTION FORM SHOULD BE FORWARDED TO US IN AMPLE TIME TO PERMIT US
TO SUBMIT A TENDER ON YOUR BEHALF ON OR BEFORE THE EXPIRATION DATE OF THE
OFFER. THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON WEDNESDAY JUNE 6, 2001, UNLESS THE COMPANY EXTENDS THE OFFER.
As described in Section 1 of the Offer to Purchase, if more than 700,000
Shares have been properly tendered at prices at or below the Purchase Price
and not withdrawn prior to the Expiration Date (as defined in the Offer to
Purchase), the Company will purchase properly tendered Shares on the basis
set forth below:
(a) first, all Shares properly tendered and not withdrawn prior to the
Expiration Date by any Odd Lot Holder (as defined in the Offer to
Purchase) who:
(1) tenders all Shares beneficially owned by such Odd Lot Holder at a
price at or below the Purchase Price (tenders of less than all Shares
owned by such shareholder will not qualify for this preference); and
(2) completes the box captioned "Odd Lots" on the Letter of
Transmittal and, if applicable, on the Notice of Guaranteed Delivery;
(b) second, after purchase of all of the foregoing Shares, all Shares
conditionally tendered in accordance with Section 6 of the Offer to
Purchase for which the condition was satisfied and all other Shares
tendered properly and unconditionally at prices at or below the Purchase
Price and not withdrawn prior to the Expiration Date on a pro rata basis
(with appropriate adjustments to avoid purchases of fractional Shares) as
described in the Section 1 of the Offer to Purchase; and
(c) third, if necessary, Shares conditionally tendered for which the
condition was not satisfied which are tendered at or below the Purchase
Price and not withdrawn prior to the Expiration Date, selected by random
lot in accordance with Section 6 of the Offer to Purchase.
You may condition your tender on the Company purchasing a minimum number
of your tendered Shares. In such case, if as a result of the preliminary
proration provisions in the Offer to Purchase the Company would purchase less
than such minimum number of your Shares, then the Company will not purchase
any of your Shares, except as provided in the next sentence. If as a result of
conditionally tendered Shares not being purchased the total number of Shares
that would be purchased is less than 700,000, the Company will select, by random
lot, for purchase from shareholders who tender all their Shares, conditionally
tendered Shares for which the condition, based on a preliminary proration, has
not been satisfied. See Section 1 of the Offer to Purchase.
The Offer 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 a valid state statute. If the Company becomes
aware of any valid state statute prohibiting the making of the Offer, the
Company will make a good faith effort to comply with such statute. If, after
such good faith effort, the Company cannot comply with such statute, the
Offer will not be made to, nor will tenders be accepted from or on behalf of,
holders of Shares in such state. In those jurisdictions whose securities,
blue sky, or other laws require the Offer to be made by a licensed broker or
dealer, the Offer shall be deemed to be made on behalf of the Company by one
or more registered brokers or dealers licensed under the laws of such
jurisdictions.
2
INSTRUCTION FORM
INSTRUCTIONS FOR TENDER OF SHARES OF GARAN, INCORPORATED
Please tender to Garan, Incorporated ("Company"), on (our) (my) behalf,
the number of Shares indicated below, which are beneficially owned by (us)
(me) and registered in your name, upon terms and subject to the conditions
contained in the Offer to Purchase of the Company dated May 4, 2001, and the
related Letter of Transmittal, the receipt of both of which is acknowledged.
--------------------------------------------------------------------------------
Number of Shares to be tendered: Shares
--------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
ODD LOTS
[ ] By checking this box the undersigned represents that the undersigned
owns, beneficially or of record, an aggregate of fewer than 100 Shares and
is tendering all of such Shares.
UNLESS A BOX UNDER "PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING
TENDERED" IN THIS INSTRUCTION FORM IS CHECKED, THE UNDERSIGNED IS TENDERING
SHARES AT THE PURCHASE PRICE, AS THE SAME SHALL BE DETERMINED BY THE COMPANY IN
ACCORDANCE WITH THE TERMS OF THE OFFER.
ODD LOT SHARES CANNOT BE CONDITIONALLY TENDERED
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
CONDITIONAL TENDER
[ ] check here if tender of Shares is conditional on the Company purchasing
all or minimum number of the tendered Shares and complete the following:
Minimum number of Shares to be sold:
-------------------
--------------------------------------------------------------------------------
3
--------------------------------------------------------------------------------
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED
--------------------------------------------------------------------------------
CHECK ONLY ONE BOX.
IF MORE THAN ONE BOX IS CHECKED OR IF NO BOX IS CHECKED,
THERE IS NO PROPER TENDER OF SHARES
(SHAREHOLDERS WHO DESIRE TO TENDER SHARES AT MORE THAN ONE PRICE MUST COMPLETE A
SEPARATE INSTRUCTION FORM FOR EACH PRICE AT WHICH SHARES ARE TENDERED. HOLDERS
OF FEWER THAN 100 SHARES WHO ELECT TO TENDER THEIR SHARES AT THE PURCHASE PRICE
AS DETERMINED BY THE COMPANY SHOULD NOT CHECK ANY BOX BELOW.)
--------------------------------------------------------------------------------
[ ] $26.00 [ ] $26.75 [ ] $27.50 [ ] $28.25 [ ] $29.00 [ ] $29.75
[ ] $26.25 [ ] $27.00 [ ] $27.75 [ ] $28.50 [ ] $29.25 [ ] $30.00
[ ] $26.50 [ ] $27.25 [ ] $28.00 [ ] $28.75 [ ] $29.50
--------------------------------------------------------------------------------
THE METHOD OF DELIVERY OF THIS DOCUMENT IS AT THE OPTION AND RISK OF THE
TENDERING SHAREHOLDER. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN
RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT
TIME SHOULD BE ALLOWED TO ASSURE DELIVERY.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE OFFER.
HOWEVER, NONE OF THE COMPANY, THE COMPANY'S BOARD OF DIRECTORS, OR THE
INFORMATION AGENT MAKES ANY RECOMMENDATION TO SHAREHOLDERS AS TO WHETHER TO
TENDER OR REFRAIN FROM TENDERING THEIR SHARES. EACH SHAREHOLDER MUST MAKE THE
DECISION WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES AND AT WHAT
PRICE OR PRICES SHARES SHOULD BE TENDERED.
Signature(s): Address:
------------------- --------------------------------
-------------------------------- ----------------------------------------
(Including Zip Code)
Name(s):
------------------------
Area Code and Telephone Number:
-------------------------------- ---------
(Please Print)
Date: , 2001
-------------------------------- -----------------------------
(Taxpayer Identification or
Social Security Number)
IMPORTANT: SHAREHOLDERS ARE ENCOURAGED TO RETURN A COMPLETED FORM W-9 WITH
THEIR INSTRUCTION FORM.
4
