What is the Impact of Washington’s Business Combination Statute on the Offer?
Because Key Tronic is organized under the laws of Washington, the state’s business combination statute (Wash. Rev. Code Sections 23B.19.010 to 23B.19.050) would apply to an acquisition proposal for Key Tronic. If Cemtrex acquires 10% or more of the outstanding shares of Key Tronic common stock in the exchange offer, the business combination statute would prohibit Cemtrex from engaging, for a five-year period following the consummation of the offer, in a merger or any other business combination with Key Tronic. However, this prohibition would not apply if any of the following occur: (1) Key Tronic’s board approves either the 10% acquisition or a proposed business combination, in each case before Cemtrex acquires the 10% interest, (2) a business combination following Cemtrex’s acquisition of 10% is approved by the Key Tronic board of directors and unaffiliated owners of two-thirds of the outstanding shares, or (3) on consummation of the offer, Cemtrex acquires at least 90% of Key Tronic’s shares outstanding at the time the offer was commenced. As a result of this statute, if Cemtrex does not acquire a significant interest in Key Tronic through this offer or otherwise obtain Key Tronic board approval, it may be restricted from engaging in a second-step merger with Key Tronic to remove shareholders who did not tender their shares in the offer. Additionally, if Cemtrex purchases further shares of Key Tronic common stock directly from its shareholders following consummation of the offer, the fair price provisions under Washington law may apply to these purchases. See “The Offer – Certain Legal Matters; Regulatory Approvals – Washington Business Combination Statute.”
What does the Board of Directors of Key Tronic Think of the Offer?
Key Tronic’s board of directors has not approved this offer or otherwise commented on it as of the date of this prospectus. Within ten business days after the date of this prospectus, Key Tronic is required by law to publish, send or give to you (and file with the SEC) a statement as to whether it recommends acceptance or rejection of the offer, that it has no opinion with respect to the offer or that it is unable to take a position with respect to the offer.
Have You Discussed the Offer with the Board of Directors of Key Tronic?
No, Cemtrex ha s not yet discussed the offer with the b oard of d irectors of Key Tronic. Cemtrex intends to communicate with Key Tronic management and seek to meet with its b oard of directors as promptly as possible following the commencement of this exchange offer. Cemtrex has requested that Key Tronic provide Cemtrex with the information required to furnish complete disclosure regarding the business, operations, financial condition and management of Key Tronic, but as of the date of this prospectus, no such information has been received.
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