Attached files
 Copyright
©2011 drugstore.com, inc. All rights reserved Confidential
Exhibit 99.2 |
 Copyright
©2011 drugstore.com, inc. All rights reserved Confidential
Additional Information
Additional Information about the Transaction
The
information
in
this
presentation
is
not,
and
is
not
intended
to
be,
a
solicitation
of
proxies
or
an
offer
of
securities.
drugstore
plans
to
file
with
the
SEC
and
mail
to
its
stockholders
a
Proxy
Statement
in
connection
with
the
transaction.
The
Proxy
Statement
will
contain
important
information
about
Walgreens,
drugstore,
the transaction and related matters. Investors and security holders are urged to read the Proxy
Statement carefully when it is available.
Investors and security holders will be able to obtain free copies of the Proxy
Statement and other documents filed with the SEC by drugstore through the web site maintained
by the SEC at www.sec.gov and by contacting drugstore Investor Relations at (212)
331-8424. In addition, investors and security holders will be able to obtain
free copies of the documents filed with the SEC on on drugstore’s website at
www.drugstore.com. Participants in the Acquisition of drugstore
drugstore.com and its directors and officers and certain other members of management and
employees may be deemed to be participants in the solicitation of proxies from its
stockholders in connection with the Transaction. Information regarding these persons
who may, under the rules of the SEC, be considered participants in the solicitation of
drugstore’s stockholders in connection with the proposed transaction will be set forth in the Proxy
Statement described above when it is filed with the SEC. Additional information regarding
drugstore’s executive officers and directors is included in drugstore’s
definitive proxy statement, which was filed with the SEC on April 30, 2010.
You
can
obtain
free
copies
of
this
document
from
drugstore
using
the
contact
information
above. |
 Copyright
©2011 drugstore.com, inc. All rights reserved Confidential
Forward-Looking Statements
Forward-Looking Statements
Information set forth in this material contains forward-looking statements, which involve
a number of risks and uncertainties. These statements include those regarding the
closing of the transaction, the integration process and the potential benefits of the
acquisition. These statements are not guarantees of future performance and are
subject to risks, uncertainties and assumptions that could cause actual results to vary
materially from those indicated, including: the ability
to
obtain
regulatory
approvals
of
the
transaction
on
the
proposed
terms
and
schedule; the
failure of drugstore’s stockholders to approve the transaction; the risk that the
businesses will not be integrated successfully; the risk that the cost savings and any
other synergies from the transaction may not be fully realized or may take longer to
realize than expected; disruption from the transaction making it more difficult to
maintain relationships with customers, employees or suppliers; competition and its
effect on pricing, spending, third-party relationships and revenues; and other
factors described in Walgreens Annual Report on Form 10-K for the year ended August
31, 2010, drugstore.com’s Annual Report on Form 10-K for the year ended January 2,
2011 and their respective subsequent SEC filings, which risks and uncertainties are
incorporated herein by reference. You are cautioned not to place undue reliance on
these forward-looking statements, which
speak
only
as
of
the
date
of
this
press
release.
Except
to
the
extent
required
by
law,
Walgreens and drugstore.com disclaim any obligation to update any forward-looking
statements after the distribution of this material, whether as a result of new
information, future events, changes in assumptions, or otherwise.
|
 Copyright
©2011 drugstore.com, inc. All rights reserved Confidential
Our Strategy
Our strategy has been consistent –
•
Be the Online Leader in Health, Beauty and Wellness
•
Provide our customers a great experience allowing them to shop
whenever, wherever and however they want to shop
•
Offer convenience and service, with a wide assortment, including
hard-to-find items
But, the world has changed –
•
Competition is increasing
•
Consolidation is occurring in our industry
•
Offline retailers are quickly moving online
So…..We Have Had a Growing Belief That We Should Partner or
Combine With a Leading Multi-Channel or Offline Retailer
1 |
 Copyright
©2011 drugstore.com, inc. All rights reserved Confidential
Our ideal partner….
2 |
 Copyright
©2011 drugstore.com, inc. All rights reserved Confidential
Walgreens –
Largest and Most Trusted
Drugstore
Named one of Fortune magazine’s Most Admired Companies in America for 17th
consecutive year
Walgreens recently donated $150K to American Red Cross and is matching up to
$100K of employee donations to help in the recent Japanese
earthquake Goal: Be America’s most trusted and convenient provider of
consumer goods and services and pharmacy, health and wellness
solutions In 2010, Sales surpassed $67B,
Net Income over $2B
Operates 7,500 stores with
244,000 total employees
Nearly 75% of American’s live
within 5 miles of a Walgreens
store
3 |
 Copyright
©2011 drugstore.com, inc. All rights reserved Confidential
Structure and Consideration
4
•
Cash purchase of DSCM shares in
connection with the merger of DSCM with a
Walgreens subsidiary
Structure
•
$3.80 per share
•
Total purchase price equal to approx $429M
Per Share
Price
•
All unvested options/SSARs and RSUs and vested
options/SSARs with an exercise price of $3.80 or
higher will be “rolled over”
to Walgreens equity
•
Vested, in the money options/SSARs and vested,
but unsettled RSUs will be paid out in cash
•
All RSAs (vested and unvested) will be paid out in
cash
Treatment of
Stock Options
& Equity |
 Copyright
©2011 drugstore.com, inc. All rights reserved Confidential
Significant Benefits to Drugstore!!
Allows us to offer a multi-channel experience
Let’s us combine with an industry leader whose
value and vision is consistent with our own
Allows us to invest more in our business
Gives us scale
Offers additional career opportunities
5 |
 Copyright
©2011 drugstore.com, inc. All rights reserved Confidential
Walgreens End-State Vision will be
Executed in a Planned and Phased Manner
Keep all existing Walgreens and DSCM online
channels
Combine the strengths of Walgreens.com and
DSCM platforms to enhance overall product
assortment and customer experience
Create the ability to easily ship to stores, pick up in
stores and offer home delivery leveraging our store
network
Combine Walgreens leading mobile capability with
DSCM’s online retail capabilities
6 |
 Copyright
©2011 drugstore.com, inc. All rights reserved Confidential
Our Guiding Principles for Transition
7 |
 Copyright
©2011 drugstore.com, inc. All rights reserved Confidential
What it Means for You?
This transaction is about growth and investment
Walgreens recognizes that each of our companies has
been successful because of its employees. Therefore, it
is a high priority for Walgreens to:
Focus on team member retention
Identify and cultivate talent from both organizations
Acquisition complements Walgreens existing
eCommerce talent base
Few job reductions expected
Will maintain separate locations, Seattle will be a
Center of Excellence
The approach to compensation and benefits is to
maintain a substantially similar offering to what our
employees currently receive:
Walgreens benefit programs are
o
Externally competitive
o
Internally equitable
o
Recognize both individual and team contributions to success
8 |
 Copyright
©2011 drugstore.com, inc. All rights reserved Confidential
Over the Next Few Weeks…
Until the transaction closes, Walgreens and DSCM must operate business
as separate companies
Together we will outline a clear integration roadmap with the key
milestones
An integration planning task force will be formed and will be composed of
both Walgreens and DSCM representatives to ensure that we leverage the
best of both organizations and minimize disruption
We ask for your support in continuing to meet our commitments to
our
customers, vendors, business partners, communities, stockholders
and to
each other
This is a two-way street. We encourage you to ask questions and
provide your input throughout this journey as we build a leading
eCommerce business together
Please direct your questions, expectations and concerns to your
manager and/or HR representative………….or your CEO!!!
9 |