----------------------------
OMB APPROVAL
----------------------------
OMB Number: 3235-0102
Expires:........May 31, 2005
Estimated Average Burden
hours per response......64.5
----------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14D-9
Solicitation/Recommendation Statement under Section 14(d)(4)
of the Securities Exchange Act of 1934
(AMENDMENT NO. ___)
ELMER'S RESTAURANT, INC.
------------------------
(Name of Subject Company)
ELMER'S RESTAURANT, INC.
------------------------
(Names of Person Filing Statement)
COMMON STOCK
------------
(Title of Class of Securities)
289393
---------------------------------------------
(CUSIP Number of Class of Securities)
Bruce N. Davis, CEO
Elmer's Restaurant, Inc.
11802 SE Stark Street
P.O. Box 16938
Portland, OR 97292-0938
----------------------------------------------------------------------------
(Name, address, and telephone numbers of person authorized to receive
notices and communications on behalf of the persons filing statement)
[ ] Check the box if the filing relates solely to preliminary communications
made before the commencement of a tender offer.
1. SUBJECT COMPANY INFORMATION.
The company that is the subject of the tender offer is Elmer's
Restaurant, Inc. ("Elmer's"). The address and telephone number of the executive
officers of Elmer's is as follows:
Bruce N. Davis, President and CEO
Jerry Scott, Vice President
Dennis R. Miller, Secretary and Corporate Controller
11802 SE Stark Street
P.O. Box 16938
Portland, OR 97292-0938
(503) 252-1485
The tender offer is for the purchase of all of the outstanding common
stock of Elmer's. As of December 8, 2004, Elmer's had 1,842,945 shares of its
common stock issued and outstanding. Of those outstanding shares, approximately
756,601 shares are owned by shareholders other than EAC, the party making this
tender offer.
2. IDENTITY AND BACKGROUND OF FILING PERSON.
Elmer's is serving as the filing person under federal securities
regulations and is filing this Schedule 14D-9 in response to the tender offer of
ERI Acquisition Corp. ("EAC"), which is soliciting the purchase of all of the
outstanding common stock of Elmer's not currently owned or controlled by EAC for
a cash price of $7.50 per share. Correspondence to Elmer's may be sent to:
Elmer's Restaurant Inc.
11802 SE Stark Street
P.O. Box 16938
Portland, OR 97292-0938
Attn: Mr. Bruce N. Davis, CEO
The address of EAC is:
363 High Street
Eugene, Oregon 97401
3. PAST CONTACTS, TRANSACTIONS, NEGOTIATIONS AND AGREEMENTS.
There are no material agreements, arrangements or understandings
between Elmer's and its directors, executive officers or affiliates
(collectively the "Elmer's Parties"), or between the Elmer's Parties and EAC,
any of its directors, executive officers or affiliates. Every member of the
board of directors of Elmer's is also a shareholder in EAC and therefore,
collectively are the principals initiating the tender offer for the purpose of
taking Elmer's private. As a result, the entire board of directors has an
inherent conflict of interest in expressing any opinion, individually or as a
group, as to the fairness or adequacy of the tender offer.
4. THE SOLICITATION OR RECOMMENDATIONS.
Because the entire board of directors are part of the group making the
tender offer, the board of directors desires that the tender offer be judged on
its merits by each individual shareholder without any undue influence by the
board regarding each shareholder's decision to accept or reject the tender offer
as proposed. Because of the inherent conflict of interest noted in Section 3
above, the board of directors is unable to take a position with respect to the
tender offer. Consequently, the shareholders being solicited should carefully
read the information presented in the tender offer and this response and make an
independent evaluation of the merits of the proposed tender offer. All Company
documents filed electronically on the SEC's website are available at
http://www.sec.gov. As a courtesy to shareholders, the Tender Offer and
accompanying filings are available on the Company's website,
www.elmers-restaurants.com.
The executive officers and directors intend to contribute their
individual shares to EAC solely for the purpose of forming a new company to
solicit the purchase of the remaining outstanding shares of Elmer's for the
purpose of reducing the number of outstanding shareholders and taking the
Elmer's private. As a result, the executive officers and directors will not own
any shares in Elmer's subject to the tender offer.
All statements and representations contained in the tender offer
documents presented to shareholders by EAC are the sole statements and
representations of EAC and should not be construed as statements,
representations or endorsements of Elmer's or its board of directors.
5. PERSON/ASSETS, RETAINED, EMPLOYED, COMPENSATED OR USED.
Elmer's has not retained, employed or compensated any person to solicit
or make a recommendation in connection with the tender offer. The principals of
EAC retained the services of Veber Partners, Inc., an investment banker
("Veber"). Veber was previously engaged by Elmer's in 1998 and is familiar with
the operations of Elmer's. EAC engaged Veber to evaluate the proposed tender
offer for EAC. Other than providing information to Veber relative to its
evaluation, Elmer's has had no involvement with the engagement of Veber and all
fees due Veber have been paid by EAC, or individually by the principals of EAC.
Veber was not engaged to provide advice or make a recommendation to Elmer's or
its shareholders.
6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
Elmer's has had no transactions in its securities in the past 60 days,
except as disclosed below:
o Each of the directors and certain executive officers have pledged
their respective shares in Elmer's to EAC,
o Elmer's has issued immaterial number of shares to departing
employees pursuant to the company's stock option plan; and
o In a separate transaction, Elmer's shares held by Franklin
Holdings LLC were distributed to its members (who are members of
EAC) as set forth in the acquiring group's Schedule 13D filed
November 19, 2004.
7. PURPOSES OF THE TRANSACTION AND PLANS OR PROPOSALS.
Elmer's is not engaged in or undertaking any negotiations in response
to the proposed tender offer for the acquisition of its securities and has no
plans, proposals, or is involved in any negotiations for such plans or
proposals, that relate to or may result in any merger, reorganization or
liquidation of Elmer's at this time. Although not negotiating with EAC or
entering into any agreement or understanding with EAC regarding any merger
between EAC and Elmer's, Elmer's is aware that the intent of the tender
offer by EAC is for the purpose of taking Elmer's private and Elmer's
acknowledges that to complete such transaction EAC, as the controlling
shareholder of Elmer's, may elect to merge Elmer's with and into EAC after the
tender offer closes. If EAC controls at least 90% of the outstanding voting
stock of Elmer's after the close of the tender offer, no approval by Elmer's or
its remaining shareholders will be required to complete such a merger and any
remaining shareholders of Elmer's after the close of the tender offer will no
longer be shareholders in either EAC or Elmer's in the event of a merger.
In response to the proposed tender offer by EAC, the board of directors adopted
corporate resolutions recognizing the formation of EAC as a controlling
shareholder for the purpose of taking Elmer's outside the scope of the Oregon
Business Combination Act. This action permits EAC to effect a merger between EAC
and Elmer's at the close of the tender offer in the event the majority of the
minority shareholders of Elmer's effectively consent to the proposed going
private transaction by tendering their shares in response to the tender offer.
8. ADDITIONAL INFORMATION.
The board of directors of Elmer's desires to have shareholders not a
part of EAC evaluate the tender offer and proposed going private transaction on
its own merits and without influence from the board of directors as a group or
individually. If a majority of the minority shareholders tender shares based on
an independent evaluation, the board of directors views such majority tender as
essentially shareholder approval of the going private transaction intended by
EAC and, accordingly, may take subsequent action, as it deems necessary, to
effect the wishes of the majority of the minority shareholders to permit the
completion of the going private transaction.
9. EXHIBITS.
None.
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Elmer's Restaurants, Inc.
By: /s/ BRUCE N. DAVIS
--------------------------------------------
Bruce N. Davis
Chief Executive Officer and President
Dated: December 21, 2004