Exhibit
99.1
CENTRAL
FREIGHT LINES, INC. ANNOUNCES AMENDMENT TO
MERGER
AGREEMENT ELIMINATING CLOSING CONDITIONS
Waco,
TX (PR Newswire) -
September 20, 2006 - Central Freight Lines, Inc. (Nasdaq/NMS: CENF) announced
today that it has entered into a First Amendment to its previously announced
Agreement and Plan of Merger (as amended, the "Merger Agreement") with North
American Truck Lines, LLC ("NATL") and Green Acquisition Company ("Green").
The
Merger Agreement provides that Jerry Moyes and certain related parties would
become the owners of Central, and Central would cease to be a publicly traded
company.
In
making
the announcement today, Central stated that, among other things, the First
Amendment:
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Waives
the purchaser's need to obtain financing as a condition to closing
the
merger; and
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Clarifies
that there is no pending litigation against Central that must
be settled
prior to closing the merger, other than the class action and
derivate
litigation for which agreements in principle to settle have been
reached,
as described in more detail
below.
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Other
principal terms of the Merger Agreement, including price, remain unaltered
by
the First Amendment. As a result, pursuant to the Merger Agreement, at the
effective time of the merger, all Central stockholders, other than Mr. Moyes,
certain related parties, and a trust created for the benefit of Mr. Moyes'
children, would receive cash in an amount equal to $2.25 per share of Central
common stock.
As
previously announced, Central also has reached oral agreements in principle
with
the plaintiffs to settle pending securities class action litigation, two
purported derivative actions related to the period between the date of Central's
initial public offering and August 2004, and a third derivative action related
to the merger transaction. These agreements in principle, if completed, would
satisfy a condition to closing of the merger. The agreements are subject to
the
completion of the usual and customary documentation for such settlements, and
are subject to, and conditioned upon, final court approval. The
settlements are expected to be funded from the proceeds of Central's directors'
and officers'
liability insurance policy.
Central
also announced today that it had recently responded to a second set of comments
from the Securities and Exchange Commission (the "SEC") with respect to its
proxy statement for the 2006 Annual Meeting of Stockholders (the "Annual
Meeting"). Approval of the Merger Agreement will be presented for a vote of
Central's stockholders at the Annual Meeting. Subject to completion of the
SEC
review process, Central has identified November 13, 2006, as the tentative
date
for the Annual Meeting.
Once
the
SEC's review of the proxy statement is finalized, the definitive proxy statement
will be mailed to Central's stockholders to solicit proxies for voting on the
merger and other matters presented at the Annual Meeting.
Bob
Fasso, Central's Chief Executive Officer and President, stated: “We are very
pleased with these developments. We believe they represent significant steps
toward completion of the merger. In particular, we believe that the elimination
of the financing condition and the achievement of agreements in principle to
settle litigation were important advancements toward completing the
merger.”
Jerry
Moyes added: “I am pleased that we have made the additional progress announced
by Central today and look forward to closing the merger as soon as possible.”
Stockholders
are urged to read the definitive proxy statement carefully when it becomes
available because it will contain important information about Central, the
merger transaction, and related matters. Stockholders will be able to obtain
free copies of the proxy statement and other documents filed with the SEC by
Central through the SEC's web site at www.sec.gov. In addition, stockholders
will be able to obtain free copies of the definitive proxy statement from
Central.
Central
Freight Lines, Inc. is a non-union, less-than-truckload carrier specializing
in
regional overnight and second day markets in the Midwest, Southwest, West Coast,
and Pacific Northwest. Utilizing marketing alliances, Central also provides
service to the Great Lakes, Northeast, Southeast, Mexico, and
Canada.
This
press release contains forward-looking statements that involve risk,
assumptions, and uncertainties that are difficult to predict. Statements that
constitute forward-looking statements are usually identified by words such
as
"anticipates," "believes," "estimates," "projects," "expects," "plans,"
"intends," or similar expressions. These statements are made pursuant to the
safe harbor provisions of Section 21E of the Securities Exchange Act of 1934,
as
amended, and Section 27A of the Securities Act of 1933, as amended. Such
statements are based upon the current beliefs and expectations of our management
and are subject to significant risks and uncertainties. Actual events may differ
materially from those set forth in the forward-looking statements. We undertake
no obligation to update any of these forward-looking
statements.
With
respect to statements regarding the date of the Annual Meeting, the consummation
of the merger and the proposed settlement of litigation, the following factors,
among others, could cause actual results to differ materially from those in
forward-looking statements: the risk that the review process or the satisfaction
or waiver of other conditions in the Merger Agreement may cause the meeting
to
be delayed; the risk that our business and liquidity will suffer due to
uncertainties caused by the announcement of the transaction; the risk that
we
may not be able to obtain third party and stockholder approvals necessary to
consummate the transaction; as well as the risk that the transaction will not
close for other reasons; the risk that the parties to the litigation in question
will not be able to agree on the terms of the proposed settlement as they
prepare the settlement documents or that the parties will not be able to obtain
court approval of the proposed settlement for some reason.
Corporate
Contact:
Jeff
Hale, Chief Financial Officer
(480)
361-5295
jhale@centralfreight.com