EXHIBIT (A)(1)(E)
Published on May 7, 2001
Exhibit (a)(1)(E)
DYNEX CAPITAL, INC.
OFFER TO PURCHASE FOR CASH UP TO:
500,000 SHARES OF SERIES A PREFERRED STOCK AT $12.24 PER SHARE
730,250 SHARES OF SERIES B PREFERRED STOCK AT $12.50 PER SHARE
702,700 SHARES OF SERIES C PREFERRED STOCK AT $15.30 PER SHARE
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 5:00 P.M.., NEW
YORK CITY TIME, ON FRIDAY, JUNE 8, 2001, UNLESS THE OFFER IS EXTENDED.
May 7, 2001
To Our Clients:
Enclosed for your consideration are the Offer to Purchase, dated May 7,
2001, and the related Letter of Transmittal, which, as amended and supplemented
from time to time, together constitute the "Offer" by Dynex Capital, Inc., a
Virginia corporation ("Dynex"), to purchase up to 500,000 shares of its Series A
Preferred Stock at $12.24 per share, 730,250 shares of its Series B Preferred
Stock at $12.50 per share and 702,700 shares of its Series C Preferred Stock at
$15.30 per share (the "Purchase Price"), net to the seller in cash, without
interest and subject to the conditions set forth in the Offer.
All shares properly tendered at or prior to the "Expiration Date" (as
defined in Section 1 of the Offer to Purchase) and not properly withdrawn will
be purchased at the Purchase Price, net to the seller in cash, without interest,
upon the terms and subject to the conditions of the Offer, including the
proration provisions. Dynex will return as promptly as practicable after the
Expiration Date, all shares not purchased because of proration. Dynex reserves
the right, in its sole discretion, to purchase any and all of the excess shares
tendered so long as the excess number accepted by Dynex does not exceed two
percent (2%) of the issued and outstanding shares of such series of Preferred
Stock.
If, proration of tendered shares of a series is required, Dynex will
determine the proration factor as soon as practicable following the Expiration
Date. Proration for each stockholder tendering shares of a series shall be based
on the ratio of the number of shares of a series properly tendered and not
properly withdrawn by such stockholder to the total number of shares of a series
properly tendered and not properly withdrawn by all stockholders of a series.
We are the owner of record of shares held for your account. As such, we
are the only ones who can tender your shares, and then only pursuant to your
instructions.
A TENDER OF YOUR SHARES CAN BE MADE ONLY BY US AS THE STOCKHOLDER OF RECORD
THEREOF AND PURSUANT TO YOUR INSTRUCTIONS. THE LETTER OF TRANSMITTAL IS
FURNISHED TO YOU FOR YOUR INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER
YOUR SHARES HELD BY US FOR YOUR ACCOUNT.
Accordingly, we request instructions as to whether you wish to tender
any or all of the shares held by us for your account, upon the terms and subject
to the conditions of the Offer.
Please note the following:
1. The Offer is not conditioned upon any minimum number of shares
being tendered. The Offer is, however, subject to certain
other conditions set forth in Section 6 of the Offer to
Purchase.
2. The Offer, proration period and withdrawal rights will expire
at 5:00 p.m., New York City time, on June 8, 2001, unless the
Offer is extended.
3. The Offer is for (i) 500,000 shares of Series A Preferred
Stock, constituting in the aggregate approximately 20% of the
shares of Series A Preferred Stock outstanding as of April 30,
2001; (ii) 730,250 shares of Series B Preferred Stock,
constituting in the aggregate approximately 20% of the shares
of Series B Preferred Stock outstanding as of April 30, 2001;
and 702,700 shares of Series C Preferred Stock, constituting
in the aggregate approximately 20% of the shares of Series C
Preferred Stock outstanding as of April 30, 2001.
4. Tendering stockholders who are registered stockholders or who
tender their shares directly to First Union National Bank will
not be obligated to pay any brokerage commissions or fees,
solicitation fees, or, except as set forth in the Offer to
Purchase and the Letter of Transmittal, stock transfer taxes
on Dynex's purchase of shares under the Offer.
5. The board of directors of Dynex has approved the Offer.
However, neither Dynex nor its board of directors makes any
recommendation to stockholders as to whether to tender or
refrain from tendering their shares or as to the price or
prices at which stockholders may choose to tender their
shares. Stockholders must make their own decision as to
whether to tender their shares and, if so, how many shares to
tender and the price or prices at which such shares should be
tendered. Dynex's directors and executive officers have agreed
not to participate in the Offer.
If you wish to have us tender any or all of your shares of Preferred
Stock, 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, all such shares
will be tendered unless otherwise indicated 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 BEFORE THE EXPIRATION DATE OF THE OFFER.
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 p.m., NEW
YORK CITY TIME, ON FRIDAY, JUNE 8, 2001, UNLESS THE OFFER IS EXTENDED.
As described in the Offer to Purchase, if more than 500,000 shares in
the case of Series A Preferred Stock, more than 730,250 shares in the case of
Series B Preferred Stock or more than 702,700 shares in the case of Series C
Preferred Stock (or such greater number of shares as Dynex may elect to
purchase, subject to applicable law), are properly tendered at or below the
Purchase Price and not properly withdrawn before the Expiration Date, Dynex will
accept shares for purchase at the Purchase Price in the following order of
priority:
1. After purchase of all of the foregoing shares, all other
shares properly tendered and not properly withdrawn before the
Expiration Date on a pro rata basis, if necessary, with
adjustments to avoid purchases of fractional shares, as
provided in the Offer to Purchase.
The Offer is being made solely under the Offer to Purchase and the
related Letter of Transmittal and is being made to all holders of shares of
Preferred Stock. The Offer is not being made to, nor will tenders be accepted
from or on behalf of, holders of shares residing in any jurisdiction in which
the making of the Offer or acceptance thereof would not be in compliance with
the securities, blue sky or other laws of such jurisdiction.
INSTRUCTION FORM WITH RESPECT TO THE
OFFER TO PURCHASE FOR CASH UP TO:
500,000 SHARES OF SERIES A PREFERRED STOCK AT $12.24
PER SHARE 730,250 SHARES OF SERIES B PREFERRED STOCK
AT $12.50 PER SHARE 702,700 SHARES OF SERIES C
PREFERRED STOCK AT $15.30 PER SHARE
The undersigned acknowledge(s) receipt of your letter and the enclosed
Offer to Purchase dated May 7, 2001 and the related Letter of Transmittal
(which, as amended or supplemented from time to time, together constitute the
"Offer"), in connection with the offer by Dynex Capital, Inc., a Virginia
corporation ("Dynex"), to purchase up to 500,000 shares of its Series A
Preferred Stock at a cash purchase price of $12.24 per share; 730,250 shares of
its Series B Preferred Stock at a cash purchase price of $12.50; and 702,700
shares of its Series C Preferred Stock at a cash purchase price of $15.30.
This will instruct you to tender to Dynex the number of shares of
Series A Preferred Stock indicated below held by you for the account or benefit
of the undersigned (or, if no amount is indicated below, for all of the shares
of Preferred Stock held by you for the account of the undersigned) upon the
terms and subject to the conditions set forth in the Offer, including the
proration provisions described in the Offer to Purchase.
THE METHOD OF DELIVERY OF THIS DOCUMENT IS AT THE ELECTION AND RISK OF
THE UNDERSIGNED. 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.
Aggregate Number of Shares of Preferred Stock to be tendered by you for the
account of the undersigned*:
Series A_________________ Series B_________________ Series C__________________
SIGN HERE:
- - -----------------------------------------
- - ------------------------------------------
Please type or print name(s)
Date: , 2001
----------------------
Area Code and Telephone Number:
- - ------------------------
Taxpayer Identification or Social Security Number:
- - -------------------------
- - --------------------------------------------------------------------------------
* Unless otherwise indicated, it will be assumed that we should tender all of
the shares held by us for your account.