sec document
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
--------------
SCHEDULE 13D
(RULE 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13d-2(a)
(Amendment No. 3)(1)
Phoenix Technologies Ltd.
-------------------------
(Name of Issuer)
Common Stock, $.001 Par Value
------------------------------
(Title of Class of Securities)
719153108
---------
(CUSIP Number)
STEVEN WOLOSKY, ESQ.
OLSHAN GRUNDMAN FROME ROSENZWEIG & WOLOSKY LLP
Park Avenue Tower
65 East 55th Street
New York, New York 10022
(212) 451-2300
--------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
July 5, 2006
------------
(Date of Event Which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition that is the subject of this Schedule 13D, and is filing
this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box / /.
NOTE. Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. SEE Rule 13d-7 for other
parties to whom copies are to be sent.
(Continued on following pages)
(Page 1 of 16 Pages)
-------------------------
(1) The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, SEE the
NOTES).
---------------------- ----------------------
CUSIP No. 719153108 13D Page 2 of 16 Pages
---------------------- ----------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
STARBOARD VALUE AND OPPORTUNITY MASTER FUND LTD.
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
WC
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Cayman Islands
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 1,950,508
OWNED BY -----------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON WITH - 0 -
-----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
1,950,508
------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
1,950,508
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
7.7%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
---------------------- ----------------------
CUSIP No. 719153108 13D Page 3 of 16 Pages
---------------------- ----------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
PARCHE, LLC 20-0870632
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
WC
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 371,525
OWNED BY -----------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON WITH - 0 -
-----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
371,525
------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
371,525
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.5%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
OO
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
---------------------- ----------------------
CUSIP No. 719153108 13D Page 4 of 16 Pages
---------------------- ----------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
ADMIRAL ADVISORS, LLC 37-1484525
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 2,322,033
OWNED BY -----------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON WITH - 0 -
-----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
2,322,033
------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
2,322,033
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.2%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IA, OO
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
---------------------- ----------------------
CUSIP No. 719153108 13D Page 5 of 16 Pages
---------------------- ----------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
RAMIUS CAPITAL GROUP, L.L.C. 13-3937658
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 2,322,033
OWNED BY -----------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON WITH - 0 -
-----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
2,322,033
------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
2,322,033
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.2%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IA, OO
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
---------------------- ----------------------
CUSIP No. 719153108 13D Page 6 of 16 Pages
---------------------- ----------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
C4S & CO., L.L.C. 13-3946794
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 2,322,033
OWNED BY -----------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON WITH - 0 -
-----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
2,322,033
------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
2,322,033
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.2%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
OO
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
---------------------- ----------------------
CUSIP No. 719153108 13D Page 7 of 16 Pages
---------------------- ----------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
PETER A. COHEN
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY -0-
OWNED BY -----------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON WITH 2,322,033
-----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
2,322,033
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
2,322,033
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.2%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
---------------------- ----------------------
CUSIP No. 719153108 13D Page 8 of 16 Pages
---------------------- ----------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
MORGAN B. STARK
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY -0-
OWNED BY -----------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON WITH 2,322,033
-----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
2,322,033
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
2,322,033
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.2%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
---------------------- ----------------------
CUSIP No. 719153108 13D Page 9 of 16 Pages
---------------------- ----------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
JEFFREY M. SOLOMON
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY -0-
OWNED BY -----------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON WITH 2,322,033
-----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
2,322,033
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
2,322,033
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.2%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
---------------------- ----------------------
CUSIP No. 719153108 13D Page 10 of 16 Pages
---------------------- ----------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
THOMAS W. STRAUSS
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY -0-
OWNED BY -----------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON WITH 2,322,033
-----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
-0-
------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
2,322,033
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
2,322,033
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.2%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
---------------------- ----------------------
CUSIP No. 719153108 13D Page 11 of 16 Pages
---------------------- ----------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
JOHN MUTCH
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) /X/
(b) / /
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
PF
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) / /
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 200,000
OWNED BY -----------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING
PERSON WITH - 0 -
-----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
200,000
------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
200,000
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
================================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT!
---------------------- ----------------------
CUSIP No. 719153108 13D Page 12 of 16 Pages
---------------------- ----------------------
The following constitutes Amendment No. 3 ("Amendment No. 3") to the
Schedule 13D filed by the undersigned. This Amendment No. 3 amends the Schedule
13D as specifically set forth.
Item 4 is hereby amended to add the following:
On July 5, 2006, Admiral Advisors, a subsidiary of Ramius,
delivered a letter to the lead independent director of the Board of Directors of
the Issuer proposing to acquire in a negotiated transaction, subject to certain
conditions, all of the Shares of the Issuer it does not already own for $5.05
per Share in cash. The letter is filed as Exhibit 5 hereto and is incorporated
herein by reference.
Item 7 is hereby amended to include the following exhibit:
5. Letter from Admiral Advisors to the lead independent
director of the Board of Directors of the Issuer,
dated July 5, 2006.
---------------------- ----------------------
CUSIP No. 719153108 13D Page 13 of 16 Pages
---------------------- ----------------------
SIGNATURES
----------
After reasonable inquiry and to the best of his knowledge and
belief, each of the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: July 6, 2006
STARBOARD VALUE AND ADMIRAL ADVISORS, LLC
OPPORTUNITY MASTER FUND LTD. By: Ramius Capital Group, L.L.C.,
its managing member
PARCHE, LLC
By: Admiral Advisors, LLC, RAMIUS CAPITAL GROUP, L.L.C.
its managing member By: C4S & Co., L.L.C.,
as managing member
C4S & CO., L.L.C.
By: /s/ Jeffrey M. Solomon
---------------------------
Name: Jeffrey M. Solomon
Title: Authorized Signatory
JEFFREY M. SOLOMON
/s/ Jeffrey M. Solomon
---------------------------------------
Individually and as attorney-in-fact for
Peter A. Cohen, Morgan B. Stark and
Thomas W. Strauss
/s/ Jeffrey C. Smith
---------------------------------------
Jeffrey C. Smith, as attorney-in-fact for John Mutch
---------------------- ----------------------
CUSIP No. 719153108 13D Page 14 of 16 Pages
---------------------- ----------------------
EXHIBIT INDEX
-------------
Exhibit Page
------- ----
1. Joint Filing Agreement by and among Starboard, Parche,
Admiral Advisors, Ramius, C4S, Mr. Cohen, Mr. Solomon,
Mr. Stark, Mr. Strauss and John Mutch, dated June 15,
2006 (previously filed). --
2. Letter from Admiral Advisors to the Board of Directors
of the Issuer, dated June 15, 2006 (previously filed). --
3. Power of Attorney for Peter A. Cohen, Morgan B. Stark,
Thomas W. Strauss and Jeffrey M. Solomon, dated March
11, 2005 (previously filed). --
4. Power of Attorney for John Mutch, dated June 23, 2006
(previously filed). --
5. Letter from Admiral Advisors to the Lead Independent
Director of the Board of Directors of the Issuer, dated
July 5, 2006. 15 to 16
---------------------- ----------------------
CUSIP No. 719153108 13D Page 15 of 16 Pages
---------------------- ----------------------
ADMIRAL ADVISORS, LLC
July 5, 2006
Mr. Anthony P. Morris
Phoenix Technologies Ltd.
Lead Independent Director
915 Murphy Ranch Road
Milpitas, CA 95035
CC: Board of Directors
Dear Mr. Morris:
Admiral Advisors, LLC, a subsidiary of Ramius Capital Group, L.L.C. and John
Mutch, an affiliate of MV Advisors LLC propose to acquire in a negotiated
transaction all of the outstanding shares of common stock of Phoenix
Technologies Ltd. (the "Phoenix" or the "Company") that we do not already own at
a price of $5.05 per share in cash (the "Proposal"). Affiliates of Ramius
Capital Group, L.L.C., and MV Advisors LLC are the beneficial owners of
2,522,033 shares of common stock of the Company, representing approximately
9.95% of the shares outstanding.
We recognize that Phoenix faces many difficult business challenges. Several
senior executives, including the CEO have recently left the Company. The Company
is navigating through a difficult distribution channel shift for the
applications business, while experiencing installation and compatibility issues
with some of its applications. The Company is working through a shift in its
Core System Software pricing strategy, which has significantly reduced near-term
revenue. The Company has struggled to penetrate the non-PC core system space and
to gain traction with its security application products. Solving these issues
will require difficult decisions and dramatic changes that we believe would be
much easier to accomplish as a private company.
In addition, Phoenix faces issues similar to other micro-cap companies,
including the high costs of Sarbanes-Oxley compliance, minimal analyst coverage,
and public scrutiny of each important decision. These issues will continue to
impair value and are a significant distraction to management. As such, it is our
belief that Phoenix should not continue as a stand-alone public company.
Our Proposal represents a premium of approximately 8% over today's closing price
of $4.68 per share, and more than an 18% premium over the average price since
the announcement of the shift in the Core System Software pricing strategy on
June 21, 2006 of $4.27 per share. We are highly confident in our ability to
obtain financing necessary to consummate the Proposal and are prepared to enter
into immediate discussions with the Company's Board of Directors, with a view
towards completing the acquisition as promptly as possible. We believe this
all-cash offer will provide shareholders with immediate liquidity and an
opportunity to maximize the current value of their investment.
The Proposal is conditioned upon satisfactory completion of due diligence
typical for a transaction of this type, receipt of financing commitments,
---------------------- ----------------------
CUSIP No. 719153108 13D Page 16 of 16 Pages
---------------------- ----------------------
obtaining all necessary consents and approvals, the waiver of any Company
anti-takeover provisions including redemption of the Company's shareholder
rights plan, other customary conditions for a transaction of this type and size,
and the execution of a mutually acceptable definitive agreement.
We stand ready to meet with the Board of Directors and its representatives as
soon as possible. We look forward to an expedited transaction that we believe
will benefit everyone involved.
Best regards,
/s/ Jeffrey C. Smith
Jeffrey C. Smith
Managing Director