<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14D-1
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(D)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
AND
SCHEDULE 13D
(INFORMATION PURSUANT TO RULE 13D-101)
CMP MEDIA INC.
(NAME OF SUBJECT COMPANY)
MFW ACQUISITION CORP.
MFW ACQUISITION HOLDINGS CORP.
(BIDDERS)
CLASS A COMMON STOCK, $0.01 PAR VALUE
(TITLE OF CLASS OF SECURITIES)
125891101
(CUSIP NUMBER OF CLASS OF SECURITIES)
ANNE W. GURNSEY, ESQ.
UNITED NEWS & MEDIA INC.
32 UNION SQUARE EAST, 5TH FLOOR
NEW YORK, NY 10003
(212) 358-6750
------------------------
COPY TO:
JAMES E. ABBOTT, ESQ.
CARTER, LEDYARD & MILBURN
2 WALL STREET
NEW YORK, NY 10005
(212) 732-3200
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO
RECEIVE NOTICES AND COMMUNICATIONS ON BEHALF OF BIDDERS)
APRIL 29, 1999
(DATE OF EVENT WHICH REQUIRES FILING OF STATEMENT ON SCHEDULE 13D)
CALCULATION OF FILING FEE
Transaction valuation: $948,852,469*
Amount of filing fee: $189,770
- ------------------------
<TABLE>
<S> <C>
* For purposes of calculating amount of fee only. This amount assumes the purchase of (i)
12,948,956 shares of Class A Common Stock and 10,152,810 shares of Class B Common Stock of
CMP Media Inc., representing all outstanding shares of each class as of April 28, 1999, at a
price of $39.00 per share, (ii) 1,795,093 shares of Class A Common Stock of CMP Media Inc.,
representing the number of shares issuable upon the exercise of all outstanding options to
acquire shares of CMP Media Inc. as of April 28, 1999, at a price of $39.00 per share minus
the aggregate exercise price of such options, and (iii) 20,418 shares of Class A Common
Stock of CMP Media Inc., representing the estimated number of shares issuable to
participants in CMP Media Inc.'s Employee Stock Purchase Plan as of April 28, 1999, at a
price of $39.00 per share.
[ ] Check box if any part of the fee is offset as provided by Rule 0-11 (a)(2) and identify the
filing with which the offsetting fee was previously paid. Identify the previous filing by
registration statement number, or the Form or Schedule and the date of its filing.
</TABLE>
<TABLE>
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Amount Previously Paid: N/A Filing Party: N/A
Form or Registration No.: N/A Date Filed: N/A
</TABLE>
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<PAGE>
SCHEDULE 14D-1 AND 13D
CUSIP NO.: 125891101
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(1) NAME OF REPORTING PERSONS: MFW ACQUISITION CORP.
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: NOT AVAILABLE
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(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
(A) / /
(B) / /
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(3) SEC USE ONLY
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(4) SOURCE OF FUNDS (SEE INSTRUCTIONS):
AF
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(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(E) OR 2(F)
/ /
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(6) CITIZENSHIP OR PLACE OF ORGANIZATION:
DELAWARE
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(7) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:
2,248,708*+
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(8) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN SHARES (SEE
INSTRUCTIONS):
/ /
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(9) PERCENT OF CLASS REPRESENTED TO AMOUNT IN ROW (7):
15.2%*+
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(10) TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):
CO
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<PAGE>
SCHEDULE 14D-1 AND 13D
CUSIP NO.: 125891101
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(1) NAME OF REPORTING PERSONS: MFW ACQUISITION HOLDINGS CORP.
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: NOT AVAILABLE
- --------------------------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
(A) / /
(B) / /
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(3) SEC USE ONLY
- --------------------------------------------------------------------------------
(4) SOURCE OF FUNDS (SEE INSTRUCTIONS):
AF
- --------------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(E) OR 2(F)
/ /
- --------------------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION:
DELAWARE
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(7) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:
2,248,708*+
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(8) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN SHARES (SEE
INSTRUCTIONS):
/ /
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(9) PERCENT OF CLASS REPRESENTED TO AMOUNT IN ROW (7):
15.2%*+
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(10) TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):
CO, HC
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<PAGE>
- ------------------------
* This Statement on Schedule 14D-1 relates to the offer by MFW Acquisition
Corp., a Delaware corporation ("Merger Sub") and wholly-owned subsidiary of
MFW Acquisition Holdings Corp., a Delaware corporation ("Parent"), to
purchase all outstanding shares of Class A Common Stock, par value $.01 per
share ("Class A Shares"), of CMP Media Inc. (the "Company"), at a price of
$39.00 per Share, net to the seller in cash (the "Cash Price"), upon the
terms and subject to the conditions set forth in the Offer to Purchase dated
May 6, 1999 (the "Offer to Purchase") and related Letter of Transmittal,
copies of which are attached hereto as Exhibits (a)(1) and (a)(2),
respectively (the "Offer"). Merger Sub simultaneously is offering to
purchase all outstanding shares of Class B Common Stock, par value $.01 per
share ("Class B Shares" and, collectively with the Class A Shares,
"Shares"), of the Company at the Cash Price, upon the terms and subject to
the conditions set forth in the Offer.
On April 28, 1999, Merger Sub, the Company, Miller Freeman Worldwide plc and
United News & Media plc entered into an Agreement and Plan of Merger (the
"Merger Agreement") pursuant to which, subject to certain terms and
conditions, Merger Sub agreed to commence the Offer, and, following
consummation thereof, to merge with and into the Company. In connection with
the Merger Agreement, Merger Sub and certain stockholders of the Company
beneficially owning in the aggregate 2,248,708 Class A Shares and 10,152,810
Class B Shares (representing approximately 15.2% of Class A Shares and
approximately 49.8% of the voting power of the Shares, after giving effect
to the conversion of such Class B Shares into Class A Shares, in each case
on a fully diluted basis) entered into a Tender and Voting Agreement dated
as of April 28, 1999 (the "Tender and Voting Agreement"), pursuant to which,
among other things, each such stockholder has agreed to tender all such
Shares pursuant to the Offer and not to withdraw such Shares as long as the
Tender and Voting Agreement remains in effect, and to vote such Shares in
favor of the Merger. Copies of the Merger Agreement and the Tender and
Voting Agreement have been filed as Exhibit (c)(1) and Exhibit (c)(2),
respectively, to this Schedule 14D-1 and 13D, and are incorporated herein by
reference.
This Statement on Schedule 14D-1 also constitutes a Statement on Schedule
13D with respect to the acquisition by Merger Sub of beneficial ownership of
the Shares subject to the Tender and Voting Agreement. The item numbers and
responses thereto below are in accordance with the requirements of Schedule
14D-1.
+ The Class B Shares are not registered pursuant to Section 12 of the
Securities Exchange Act of 1934, as amended.
ITEM 1. SECURITY AND SUBJECT COMPANY.
(a) The name of the subject company is CMP Media Inc., a Delaware
corporation (the "Company"), which has its principal executive offices at 600
Community Drive, Manhasset, New York 11030.
(b) This Statement on Schedule 14D-1 relates to the offer by Merger Sub to
purchase all outstanding Class A Shares, at the Cash Price, upon the terms and
subject to the conditions set forth in the Offer. Merger Sub simultaneously is
offering to purchase all outstanding Class B Shares at the Cash Price, upon the
terms and subject to the conditions set forth in the Offer. Based upon
information provided by the Company, there were 12,948,956 Class A Shares and
10,152,810 Class B Shares outstanding as of April 28, 1999. The information set
forth in the introduction of the Offer to Purchase is incorporated herein by
reference.
(c) The information set forth in "Section 6. Price Range of the Shares" of
the Offer to Purchase is incorporated herein by reference.
ITEM 2. IDENTITY AND BACKGROUND.
(a)-(d), (g) This statement is being filed by Parent and Merger Sub. The
information concerning the name, state or other place of organization, its
principal business and the address of its principal office with respect to each
of Parent and Merger Sub are set forth in the Introduction and "Section 8.
Certain
<PAGE>
Information Concerning Merger Sub and Parent" of the Offer to Purchase, and such
information is incorporated herein by reference.
(e)-(f) During the last five years, neither Merger Sub nor Parent nor, to
the best knowledge of Merger Sub and Parent, any of the persons listed on
Schedule I to the Offer to Purchase, has (i) been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors) or (ii) been a
party to a civil proceeding of a judicial or administrative body of competent
jurisdiction and as a result of such proceeding was or is subject to a judgment,
decree or final order enjoining future violations of, or prohibiting activities
subject to, federal or state securities laws or finding any violation of such
laws.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY.
(a)-(b) The information set forth in "Section 10. Background of the Offer;
Contacts with the Company; Merger Agreement; Tender and Voting Agreement;" of
the Offer to Purchase is incorporated herein by reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) The information set forth in "Section 9. Financing of the Offer and the
Merger" of the Offer to Purchase is incorporated herein by reference.
(b)-(c) Not applicable.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER.
(a)-(e) The information set forth in "Section 10. Background of the Offer;
Contacts with the Company; Merger Agreement; Tender and Voting Agreement" and
"Section 11. Purpose of the Offer; Plans for the Surviving Corporation after the
Offer and the Merger" of the Offer to Purchase is incorporated herein by
reference.
(f)-(g) The information set forth in "Section 6. Price Range of the Shares"
and "Section 13. Effect of the Offer on Market for Shares; Nasdaq Listing;
Registration under the Exchange Act" of the Offer to Purchase is incorporated
herein by reference.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
(a) The information set forth in the Introduction, "Section 8. Certain
Information Concerning Merger Sub and Parent" and "Section 10. Background of the
Offer; Contacts with the Company; Merger Agreement; Tender and Voting Agreement"
of the Offer to Purchase is incorporated herein by reference.
(b) The information set forth in the Introduction, "Section 8. Certain
Information Concerning Merger Sub and Parent" and "Section 10. Background of the
Offer; Contacts with the Company; Merger Agreement; Tender and Voting Agreement"
of the Offer to Purchase is incorporated herein by reference.
ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
THE SUBJECT COMPANY'S SECURITIES.
The information set forth in the Introduction, "Section 8. Certain
Information Concerning Merger Sub and Parent," and "Section 10. Background of
the Offer; Contacts with the Company; Merger Agreement; Tender and Voting
Agreement" of the Offer to Purchase is incorporated herein by reference.
ITEM 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
The information set forth in "Section 16. Fees and Expenses" of the Offer to
Purchase is incorporated herein by reference.
<PAGE>
ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS.
The information set forth in "Section 8. Certain Information Concerning
Merger Sub and Parent" of the Offer to Purchase is incorporated herein by
reference.
ITEM 10. ADDITIONAL INFORMATION.
(a) The information set forth in the Introduction, "Section 10. Background
of the Offer; Contacts with the Company; Merger Agreement; Tender and Voting
Agreement" of the Offer to Purchase is incorporated herein by reference.
(b) and (c) The information set forth in "Section 15. Certain Legal Matters
and Regulatory Approvals" of the Offer to Purchase is incorporated herein by
reference.
(d) The information set forth in "Section 13. Effect of the Offer on Market
for Shares; Nasdaq Listing; Registration under the Exchange Act" of the Offer to
Purchase is incorporated herein by reference.
(e) None.
(f) The information set forth in the Offer to Purchase and the Letter of
Transmittal, copies of which are attached hereto as Exhibits (a)(1) and (a)(2),
respectively, is incorporated herein by reference in its entirety.
ITEM 11. MATERIAL FILED AS EXHIBITS.
(a)(1) Offer to Purchase, dated May 6, 1999
(a)(2) Letter of Transmittal
(a)(3) Notice of Guaranteed Delivery
(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and
Other Nominees
(a)(5) Letter from Brokers, Dealers, Commercial Banks, Trust Companies and
Other Nominees to their Clients
(a)(6) Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9
(a)(7) Press release dated April 29, 1999
(a)(8) Summary advertisement dated May 6, 1999
(b) Letter agreement dated April 29, 1999 between Lloyds Bank Plc and United
News & Media plc
(c)(1) Agreement and Plan of Merger dated as of April 28, 1999 among United
News & Media plc, Miller Freeman Worldwide plc, MFW Acquisition Corp. and CMP
Media Inc.
(c)(2) Tender and Voting Agreement dated as of April 28, 1999 among MFW
Acquisition Corp. and certain shareholders of CMP Media, Inc.
(d) None.
(e) Not applicable.
(f) Not applicable.
<PAGE>
SIGNATURE
After due and reasonable inquiry and to the best of my knowledge and belief,
I certify that the information set forth in this statement is true, complete and
correct.
May 6, 1999
<TABLE>
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MFW ACQUISITION CORP.
By: /s/ DONALD PAZOUR
-----------------------------------------
Name: Donald Pazour
Title: CHIEF EXECUTIVE OFFICER
MFW ACQUISITION HOLDINGS CORP.
By: /s/ DONALD PAZOUR
-----------------------------------------
Name: Donald Pazour
Title: CHIEF EXECUTIVE OFFICER
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PAGE NO. IN
EXHIBIT SEQUENTIALLY
NO. TITLE NUMBERED SCHEDULE
- ----------- ------------------------------------------------------------------------------------- -------------------
<C> <S> <C>
(a)(1) Offer to Purchase, dated May 6, 1999.................................................
(a)(2) Letter of Transmittal................................................................
(a)(3) Notice of Guaranteed Delivery........................................................
(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.....
(a)(5) Letter from Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees to
their Clients........................................................................
(a)(6) Guidelines for Certification of Taxpayer Identification Number on Substitute Form
W-9..................................................................................
(a)(7) Press release, dated April 29, 1999..................................................
(a)(8) Summary advertisement dated May 6, 1999..............................................
(b) Letter Agreement dated April 29, 1999 between Lloyds Bank Plc and United News & Media
plc..................................................................................
(c)(1) Agreement and Plan of Merger, dated as of April 28, 1999, among United News & Media
plc, Miller Freeman Worldwide plc, MFW Acquisition Corp. and CMP Media Inc...........
(c)(2) Tender and Voting Agreement dated as of April 28, 1999 among MFW Acquisition Corp.
and certain shareholders of CMP Media, Inc...........................................
</TABLE>
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
CMP MEDIA INC.
AT
$39.00 PER SHARE, NET
BY
MFW ACQUISITION CORP.,
A WHOLLY-OWNED SUBSIDIARY
OF
MFW ACQUISITION HOLDINGS CORP.,
A WHOLLY-OWNED INDIRECT SUBSIDIARY
OF UNITED NEWS & MEDIA PLC
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON THURSDAY, JUNE 3, 1999, UNLESS THE OFFER IS
EXTENDED.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (I) THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER SHARES
REPRESENTING AT LEAST 51% OF THE NUMBER AND VOTING POWER OF THE OUTSTANDING
SHARES OF COMMON STOCK OF CMP MEDIA INC. (THE "COMPANY") ON A FULLY DILUTED
BASIS AND (II) THE EXPIRATION OR TERMINATION OF ANY APPLICABLE WAITING PERIOD
UNDER THE HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT OF 1976, AS AMENDED. THE
OFFER IS ALSO SUBJECT TO OTHER TERMS AND CONDITIONS WHICH ARE CONTAINED IN THIS
OFFER TO PURCHASE. SEE SECTION 14.
THE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY HAS DETERMINED THAT EACH
OF THE OFFER AND THE MERGER IS FAIR TO, AND IN THE BEST INTERESTS OF, THE
STOCKHOLDERS OF THE COMPANY, AND RECOMMENDS THAT STOCKHOLDERS ACCEPT THE OFFER
AND TENDER THEIR SHARES PURSUANT TO THE OFFER.
------------------------
IMPORTANT
Any stockholder desiring to tender all or any portion of such stockholder's
shares of Class A Common Stock, par value $.01 per share, or Class B Common
Stock, par value $.01 per share (collectively, the "Shares"), of the Company,
should either (1) complete and sign the Letter of Transmittal, or a facsimile
copy thereof, in accordance with the instructions in the Letter of Transmittal
and mail or deliver it together with the certificate(s) evidencing tendered
Shares (the "Share Certificates"), and any other required documents, to the
Depositary named on the back cover of this Offer to Purchase or tender such
Shares pursuant to the procedure for book-entry transfer set forth in Section 3,
or (2) request such stockholder's broker, dealer, commercial bank, trust company
or other nominee to effect the transaction for such stockholder. Any stockholder
whose Shares are registered in the name of a broker, dealer, commercial bank,
trust company or other nominee must contact such broker, dealer, commercial
bank, trust company or other nominee if such stockholder desires to tender such
Shares.
A stockholder who desires to tender Shares and whose Share Certificates are
not immediately available, or who cannot comply with the procedures for
book-entry transfer described in this Offer to Purchase on a timely basis, may
tender such Shares by following the procedure for guaranteed delivery set forth
in Section 3.
Questions and requests for assistance may be directed to the Information
Agent at its address and telephone number set forth on the back cover of this
Offer to Purchase. Additional copies of this Offer to Purchase, the Letter of
Transmittal and the Notice of Guaranteed Delivery and other tender offer
materials may also be obtained from the Information Agent or from brokers,
dealers, commercial banks or trust companies.
------------------------
May 6, 1999
<PAGE>
TABLE OF CONTENTS
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PAGE
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INTRODUCTION.............................................................................................. 1
SECTION 1. Terms of Offer; Expiration Date......................................................... 3
SECTION 2. Acceptance for Payment and Payment for Shares........................................... 4
SECTION 3. Procedure for Accepting the Offer and Tendering Shares.................................. 5
SECTION 4. Withdrawal Rights....................................................................... 8
SECTION 5. Certain Federal Income Tax Consequences................................................. 9
SECTION 6. Price Range of the Shares............................................................... 10
SECTION 7. Certain Information Concerning the Company.............................................. 10
SECTION 8. Certain Information Concerning Merger Sub and Parent.................................... 13
SECTION 9. Financing of the Offer and the Merger................................................... 14
SECTION 10. Background of the Offer; Contacts with the Company; Merger Agreement; Tender and Voting 15
Agreement...............................................................................
SECTION 11. Purpose of the Offer; Plans for the Surviving Corporation after the Offer and the 22
Merger..................................................................................
SECTION 12. Dividends and Distributions............................................................. 23
SECTION 13. Effect of the Offer on Market for Shares; Nasdaq Listing; Registration under the 23
Exchange Act............................................................................
SECTION 14. Certain Conditions of the Offer......................................................... 24
SECTION 15. Certain Legal Matters and Regulatory Approvals.......................................... 26
SECTION 16. Fees and Expenses....................................................................... 28
SECTION 17. Miscellaneous........................................................................... 28
</TABLE>
i
<PAGE>
TO THE HOLDERS OF COMMON STOCK OF
CMP MEDIA INC.
INTRODUCTION
MFW Acquisition Corp., a Delaware corporation (the "Merger Sub") and
wholly-owned subsidiary of MFW Acquisition Holdings Corp., a Delaware
corporation ("Parent"), hereby offers to purchase all outstanding shares of the
Class A Common Stock, par value $.01 per share (the "Class A Shares"), and the
Class B Common Stock, par value $.01 per share (the "Class B Shares," and,
collectively with the Class A Shares, the "Shares") of CMP Media Inc. a Delaware
corporation (the "Company"), at a price of $39.00 per Share, net to the seller
in cash, upon the terms and subject to the conditions set forth in this Offer to
Purchase and in the related Letter of Transmittal (which together constitute the
"Offer"). Each of Parent, Merger Sub and Miller Freeman Worldwide plc ("MF
Worldwide") are wholly-owned indirect subsidiaries of United News & Media plc,
an English public limited company ("United").
Tendering stockholders will not be obligated to pay brokerage fees or
commissions or, except as set forth in Instruction 6 of the Letter of
Transmittal, stock transfer taxes on the purchase of Shares by Merger Sub
pursuant to the Offer. Merger Sub will pay all charges and expenses of
ChaseMellon Shareholder Services, L.L.C. (the "Depositary"), Allen & Company
Incorporated (the "Dealer Manager") and D.F. King & Co., Inc. (the "Information
Agent") incurred in connection with the Offer.
THE BOARD OF DIRECTORS OF THE COMPANY (THE "BOARD") UNANIMOUSLY HAS
DETERMINED THAT EACH OF THE OFFER AND THE MERGER (AS DEFINED BELOW) IS FAIR TO,
AND IN THE BEST INTERESTS OF, THE STOCKHOLDERS OF THE COMPANY, AND RECOMMENDS
THAT STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR SHARES PURSUANT TO THE
OFFER.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (I) THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER SHARES
REPRESENTING AT LEAST 51% OF THE NUMBER AND VOTING POWER OF THE OUTSTANDING
SHARES OF THE COMPANY ON A FULLY DILUTED BASIS (THE "MINIMUM CONDITION"), AND
(II) THE EXPIRATION OR TERMINATION OF ALL APPLICABLE WAITING PERIODS UNDER THE
HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT OF 1976, AS AMENDED (THE "HSR
ACT"). THE OFFER IS ALSO SUBJECT TO OTHER TERMS AND CONDITIONS WHICH ARE
CONTAINED IN THIS OFFER TO PURCHASE. SEE SECTION 14.
The Offer is being made pursuant to an Agreement and Plan of Merger dated as
of April 28, 1999 (the "Merger Agreement") by and among Merger Sub, the Company,
MF Worldwide and United. The Merger Agreement provides, among other things, for
the making of the Offer by Merger Sub and further provides that, following the
purchase of Shares pursuant to the Offer and promptly after the satisfaction or
waiver of certain other conditions and in accordance with the relevant
provisions of the General Corporation Law of the State of Delaware (the "DGCL"),
Merger Sub will be merged with and into the Company and the separate corporate
existence of Merger Sub will cease (the "Merger"). (The Company, as the entity
which will survive the Merger, is sometimes referred to herein as the "Surviving
Corporation.") As a result of the Merger, the Surviving Corporation will be a
wholly-owned subsidiary of Parent and an indirect wholly-owned subsidiary of
United. At the time of the Merger (the "Effective Time"), each Share issued and
outstanding immediately prior to the Effective Time (other than Shares owned by
Merger Sub, by the Company (which shall not include any shares held by the trust
established pursuant to the 1999 Leeds Family/CMP Media Inc. Employee Benefit
Trust Agreement) or by any direct or indirect wholly-owned subsidiary of the
Company or held by stockholders who shall have demanded and perfected appraisal
rights, if any, under the DGCL) will be canceled and converted automatically
into the right to
1
<PAGE>
receive $39.00 in cash, or any higher price that may be paid per share in the
Offer, without interest (the "Merger Consideration"). See Section 10 for a more
detailed description of the Merger Agreement.
Holders of Class A Shares are entitled to one vote for each such Share held
and holders of Class B Shares are entitled to ten votes for each such Share
held. Each Class B Share is convertible, at the option of the holder, into one
Class A Share, and automatically will be so converted when acquired by Merger
Sub pursuant to the Offer. See Section 7.
In connection with the execution of the Merger Agreement, Merger Sub entered
into a Tender and Voting Agreement, dated as of April 28, 1999 (the "Tender and
Voting Agreement"), with the holders of all of the outstanding Class B Shares,
which represented approximately 90% of the voting power of the outstanding
Shares of the Company as of April 28, 1999. Pursuant to the Tender and Voting
Agreement, the holders of Class B Shares have agreed, among other things, to
tender all such Shares pursuant to the Offer, and not withdraw such Shares as
long as the Tender and Voting Agreement remains in effect, and to vote such
Shares in favor of the Merger. See Section 10.
The consummation of the Merger is subject to the satisfaction or waiver of
certain conditions, including the approval and adoption of the Merger Agreement
by the requisite vote of the stockholders of the Company. Under the Company's
Certificate of Incorporation and the DGCL, the affirmative vote of the holders
of Shares having a majority of the voting rights of all outstanding Shares is
required to approve and adopt the Merger Agreement and the Merger. Consequently,
if Merger Sub acquires (pursuant to the Offer or otherwise) Shares having a
majority of the voting rights of all outstanding Shares, Merger Sub will have
sufficient voting power to approve and adopt the Merger Agreement and the Merger
without the vote of any other stockholder.
Under the DGCL, if Merger Sub acquires, pursuant to the Offer or otherwise,
at least 90% of each class of Shares then outstanding, Merger Sub will be able
to approve and adopt the Merger Agreement and the transactions contemplated
thereby, including the Merger, without a vote of the Company's stockholders. In
such event, Merger Sub and the Company have agreed to take all necessary and
appropriate action to cause the Merger to become effective as soon as reasonably
practicable after such acquisition, without a meeting of the Company's
stockholders. If, however, Merger Sub does not acquire at least 90% of each
class of Shares then outstanding pursuant to the Offer or otherwise and a vote
of the Company's stockholders is required under the DGCL, a significantly longer
period of time will be required to effect the Merger. See Section 10 for a more
detailed description of the Merger. Merger Sub reserves the right, subject to
certain conditions described below, to extend the Offer for up to 10 business
days if less than 90% of the Class A Shares have been tendered.
The Company has represented to Merger Sub that (i) as of April 28, 1999,
12,948,956 Class A Shares and 10,152,810 Class B Shares were issued and
outstanding and (ii) as of April 27, 1999 the Company had reserved 266,311 Class
A Shares for issuance upon exercise of options under the Company's Stock
Incentive Plan, 25,827 Class A Shares for issuance under the Company's
Directors' Stock Compensation Plan, and 1,446,835 Class A Shares for issuance
under the Company's Employee Stock Purchase Plan (collectively the "Plans"). See
Section 10 for a description of the treatment of rights to acquire Shares under
the Plans.
The Company has been advised by each of its directors and executive officers
that they intend to tender all Shares beneficially owned by them pursuant to the
Offer. After giving effect to the automatic conversion of all Class B Shares,
the directors and executive officers of the Company hold Shares representing in
the aggregate approximately 41% of the voting rights of the issued and
outstanding Shares and approximately 38% of the voting rights of the Shares on a
fully diluted basis.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE MERGER
AGREEMENT, THE TENDER AND VOTING AGREEMENT AND THE TRANSACTIONS CONTEMPLATED
THEREBY AND DETERMINED THAT THE TERMS OF THE OFFER
2
<PAGE>
AND THE MERGER AS SET FORTH IN THE MERGER AGREEMENT ARE FAIR TO, AND IN THE BEST
INTERESTS OF, THE COMPANY'S STOCKHOLDERS.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION WHICH SHOULD BE READ IN ITS ENTIRETY BEFORE ANY DECISION
IS MADE WITH RESPECT TO THE OFFER.
SECTION 1. TERMS OF OFFER; EXPIRATION DATE.
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any such extension or
amendment), Merger Sub will accept for payment and will pay for all Shares duly
tendered on or prior to the Expiration Date (as hereinafter defined) and not
properly withdrawn in accordance with the provisions set forth in Section 4. The
term "Expiration Date" shall mean 12:00 Midnight, New York City time, on June 3,
1999, unless and until Merger Sub, in its sole discretion (but subject to the
terms and conditions of the Merger Agreement), shall have extended the period of
time during which the Offer is open, in which event the term "Expiration Date"
shall mean the latest time and date at which the Offer, as so extended by Merger
Sub, shall expire.
Merger Sub expressly reserves the right, in its sole discretion (but subject
to the terms and conditions of the Merger Agreement), at any time or from time
to time, to extend for any reason consistent with the terms of the Merger
Agreement, the period of time during which the Offer is open, including the
failure of any of the conditions set forth in Section 14 to have been satisfied
or waived, by giving oral or written notice of such extension to the Depositary
and by providing notice thereof, if applicable, as required by rules promulgated
by the Securities and Exchange Commission (the "SEC"). During any such
extension, all Shares previously tendered and not properly withdrawn will remain
subject to the Offer, subject to the right of a tendering stockholder to
withdraw such stockholder's Shares. See Section 4.
Merger Sub expressly reserves the right, at any time and from time to time,
if any of the conditions to the Offer are not satisfied, to (i) terminate the
Offer, (ii) postpone acceptance of, and payment for, any Shares or (iii) waive
any condition or otherwise amend the Offer in any respect, by giving notice
thereof to the Depositary (and such other persons as required by the SEC),
subject in each case to the applicable rules and regulations of the SEC and the
terms and conditions of the Merger Agreement. The Merger Agreement states that,
without the prior written consent of the Company, Merger Sub shall not (i)
decrease the price per Share payable in the Offer or change the form of
consideration payable in the Offer, (ii) decrease the number of Shares sought,
(iii) amend or waive satisfaction of the Minimum Condition or (iv) impose
additional conditions to the Offer or amend any other term of the Offer in any
manner adverse to the holders of Shares; except that Merger Sub may, without the
consent of the Company, (i) extend the Offer beyond the scheduled expiration
date (the initial scheduled expiration date being 20 business days following the
commencement of the Offer) if, at the scheduled expiration date of the Offer,
any of the conditions to Merger Sub's obligation to accept for payment, and to
pay for, the Shares, shall not be satisfied or waived, (ii) extend the Offer for
an aggregate period of not more than 10 business days if, immediately prior to
the initial expiration date of the Offer (as it may be extended), after giving
effect to the automatic conversion of all Class B Shares validly tendered and
not withdrawn, the Class A Shares validly tendered and not withdrawn pursuant to
the Offer equal less than 90% of the outstanding Class A Shares and Merger Sub
irrevocably expressly waives any condition (other than the Minimum Condition)
that subsequently may not be satisfied during such extension of the Offer, or
(iii) extend the Offer for any period required by any rule, regulation or
interpretation of the SEC or the staff thereof applicable to the Offer.
If Merger Sub extends the Offer, or, subject to the provisions of Rule
14e-1(c) under the Securities Exchange Act of 1934, as amended (the "Exchange
Act") if Merger Sub (whether before or after its acceptance for payment of
Shares) is delayed in its payment for Shares or is unable to pay for the Shares
pursuant to the Offer for any reason, then, without prejudice to Merger Sub's
rights under the Offer, the
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<PAGE>
Depositary may nevertheless, on behalf of Merger Sub, retain tendered Shares,
and such Shares may not be withdrawn except to the extent tendering stockholders
are entitled to withdrawal rights. See Section 4.
Any extension, delay in payment, amendment or termination of the Offer will
be followed as promptly as practicable by a public announcement in accordance
with the public announcement requirements of Rule 14e-1(d) under the Exchange
Act. Subject to applicable law (including Rules 14d-4(c) and 14d-6(d) under the
Exchange Act, which require that any material change in the information
published, sent or given to stockholders in connection with the Offer be
promptly disseminated to stockholders in a manner reasonably designed to inform
stockholders of such change) and without limiting the manner in which Merger Sub
may choose to make any public announcement, Merger Sub shall have no obligation
to publish, advertise or otherwise communicate any such public announcement
other than by making a release to the Dow Jones News Service.
If Merger Sub makes a material change in the terms of the Offer or the
information concerning the Offer or waives a material condition of the Offer,
Merger Sub will extend the Offer to the extent required by Rules 14d-4(c),
14d-6(d) and 14e-1 under the Exchange Act.
The Company has provided Merger Sub with the Company's stockholder list and
security position listings for the purpose of disseminating the Offer to holders
of Shares. This Offer to Purchase and the related Letter of Transmittal will be
mailed to record holders of Shares and will be furnished to brokers, dealers,
commercial banks, trust companies and similar persons whose names, or the names
of whose nominees, appear on the stockholder list or, if applicable, who are
listed as participants in a clearing agency's security position listing for
subsequent transmittal to beneficial owners of Shares.
SECTION 2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES.
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any such extension or
amendment), the purchase of and payment for Shares validly tendered on or prior
to the Expiration Date and not properly withdrawn as permitted by Section 4 will
be made as promptly as reasonably practicable after the latest to occur of (i)
the Expiration Date, (ii) the expiration or termination of any applicable
waiting period under the HSR Act and (iii) the satisfaction or waiver of the
conditions to the Offer set forth in Section 14. Any determination concerning
the satisfaction of the terms and conditions of the Offer shall be within the
sole discretion of Merger Sub and such determination shall be final and binding
on all tendering stockholders, subject to the terms of the Merger Agreement. In
addition, Merger Sub reserves the right, in its sole discretion, subject to
applicable rules promulgated by the SEC, (A) to accelerate the acceptance for
payment of, and the payment for, Shares consistent with any applicable
withdrawal rights and (B) to delay acceptance for payment of, or payment for,
Shares pending receipt of any regulatory approvals specified in Section 15 or in
order to comply, in whole or in part, with any other applicable law.
In all cases, payment for Shares tendered and accepted for payment pursuant
to the Offer will be made only after timely receipt by the Depositary of (i) the
Share Certificates or timely confirmation (a "Book-Entry Confirmation") of a
book-entry transfer of such Shares into the Depositary's account at the
Depository Trust Company (the "Book-Entry Transfer Facility"), pursuant to the
procedures set forth in Section 3, (ii) a properly completed and duly executed
Form of Acceptance and Letter of Transmittal (or a facsimile thereof), with any
required signature guarantees or an Agent's Message (as defined in Section 3) in
connection with a book-entry transfer, and (iii) any other documents required by
the Letter of Transmittal.
United expects to file, promptly but in no event after May 19, 1999, with
the Federal Trade Commission (the "FTC") and the Antitrust Division of the
Department of Justice (the "Antitrust Division") a Premerger Notification and
Report Form under the HSR Act with respect to the Offer. Accordingly, it is
anticipated that the waiting period with respect to the Offer under the HSR Act
will expire at 11:59 P.M., New York City time, by not later than June 3, 1999.
Prior to such time the FTC or the
4
<PAGE>
Antitrust Division may extend such waiting period by requesting additional
information or material from Parent. If such request is made, the waiting period
will expire at 11:59 P.M., New York City time, on the tenth calendar day after
substantial compliance by Merger Sub with such a request. Thereafter, the
waiting period may only be extended by court order. Any waiting period under the
HSR Act may be terminated in individual cases by the FTC and the Antitrust
Division prior to its expiration. See Section 15.
For purposes of the Offer, Merger Sub will be deemed to have accepted for
payment and for purchase Shares validly tendered and not properly withdrawn if
and when Merger Sub gives oral or written notice to the Depositary of its
acceptance for payment of such Shares pursuant to the Offer. In all cases, upon
the terms and subject to the conditions of the Offer, payment for Shares so
accepted for payment will be made by the deposit of the purchase price
thereafter with the Depositary, which will act as agent for the tendering
stockholders for the purpose of receiving payment from Merger Sub and
transmitting payment to validly tendering stockholders whose Shares have been
accepted for payment. UNDER NO CIRCUMSTANCES WILL INTEREST ON THE PURCHASE PRICE
FOR SHARES TENDERED PURSUANT TO THE OFFER BE PAID BY MERGER SUB REGARDLESS OF
ANY EXTENSION OR DELAY IN MAKING SUCH PAYMENT.
If any tendered Shares are not accepted for payment pursuant to the terms
and conditions of the Offer or if Share Certificates are submitted evidencing
more Shares than are tendered, Share Certificates for such unpurchased or
untendered Shares will be returned (or, in the case of Shares tendered by
book-entry transfer within the Book-Entry Transfer Facility, such Shares will be
credited to an account maintained within the Book-Entry Transfer Facility),
without expense to the tendering stockholder, as promptly as practicable
following the expiration or termination of the Offer. Return of such Share
Certificates will be made to and at the risk of the tendering stockholder. Upon
the deposit of funds with the Depositary for the purpose of making payments to
tendering stockholders, Merger Sub's obligation to make such payments shall be
satisfied and tendering stockholders must thereafter look solely to the
Depositary for payment of amounts owed to them by reason of the acceptance for
payment of Shares pursuant to the Offer.
If, prior to the Expiration Date, Merger Sub varies the terms of the Offer
by increasing the consideration to be paid for Shares, Merger Sub will pay such
increased consideration for all Shares purchased pursuant to the Offer, whether
or not such Shares have been tendered or purchased prior to such variation in
the terms of the Offer.
Subject to the terms of the Merger Agreement, Merger Sub reserves the right
to transfer or assign, in whole or from time to time in part, to one or more of
its subsidiaries or to other affiliates of Parent the right to purchase all or
any portion of the Shares tendered pursuant to the Offer, but any such transfer
or assignment will not relieve Merger Sub of its obligations under the Offer and
will in no way prejudice the rights of tendering stockholders to receive payment
for Shares validly tendered and accepted for payment pursuant to the Offer.
SECTION 3. PROCEDURE FOR ACCEPTING THE OFFER AND TENDERING SHARES.
VALID TENDER OF SHARES. For a stockholder validly to tender Shares pursuant
to the Offer, a properly completed and duly executed Letter of Transmittal (or
facsimile thereof), with any required signature guarantees (or an Agent's
Message in connection with a book-entry transfer of Shares) and any other
required documents, must be transmitted to and received by the Depositary at its
address set forth on the back cover of this Offer to Purchase and either (i)
Share Certificates for tendered Shares must be received by the Depositary at
such address or such Shares must be tendered pursuant to the procedures for
book-entry transfer set forth below (and a confirmation of receipt of such
tender received by the Depositary) in each case prior to the Expiration Date, or
(ii) the tendering stockholder must comply with the guaranteed delivery
procedure described below.
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<PAGE>
BOOK-ENTRY TRANSFERS. The Depositary will establish an account with respect
to the Shares at the Book-Entry Transfer Facility for purposes of the Offer
within two business days after the date of this Offer to Purchase. Any financial
institution that is a participant in a Book-Entry Transfer Facility may make
book-entry delivery of the Shares by causing the Book-Entry Transfer Facility to
transfer such Shares into the Depositary's account in accordance with the
Book-Entry Transfer Facility's procedure for such transfer. However, although
delivery of Shares may be effected through book-entry transfer at the Book-Entry
Transfer Facility, the properly completed and duly executed Letter of
Transmittal (or facsimile thereof), with any required signature guarantees, or
an Agent's Message in connection with a book-entry transfer, and any other
required documents, must, in any case, be received by the Depositary at its
address set forth on the back cover of this Offer to Purchase on or prior to the
Expiration Date, or the tendering stockholder must comply with the guaranteed
delivery procedure described below. The confirmation of a book-entry transfer of
Shares into the Depositary's account at the Book-Entry Transfer Facility as
described above is referred to herein as a "Book-Entry Confirmation." DELIVERY
OF DOCUMENTS TO THE BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH ITS
BOOK-ENTRY PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
The term "Agent's Message" means a message, transmitted by the Book-Entry
Transfer Facility to, and received by, the Depositary and forming a part of the
Book-Entry Confirmation, which states that the Book-Entry Transfer Facility has
received an express acknowledgment from the participant in the Book-Entry
Transfer Facility tendering the Shares that such participant has received the
Letter of Transmittal and agrees to be bound by the terms of the Letter of
Transmittal and that Merger Sub may enforce such agreement against such
participant.
THE METHOD OF DELIVERY OF SHARE CERTIFICATES, THE LETTER OF TRANSMITTAL AND
ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH ANY BOOK-ENTRY TRANSFER
FACILITY, IS AT THE OPTION AND SOLE RISK OF THE TENDERING STOCKHOLDER, AND THE
DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF
DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY
INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO
ENSURE TIMELY DELIVERY.
SIGNATURE GUARANTEES. No signature guarantee on the Letter of Transmittal
is required if (a) the Letter of Transmittal is signed by the registered holder
of Shares (which term, for purposes of this Section, includes any participant in
a Book-Entry Transfer Facility system whose name appears on a security position
listing as the owner of the Shares) tendered therewith and such registered
holder has not completed either the box entitled "Special Delivery Instructions"
or the box entitled "Special Payment Instructions" on such Letter of Transmittal
or (b) such Shares are tendered for the account of a bank, broker, dealer,
credit union, savings association or other entity that is a member in good
standing of the Securities Transfer Agents Medallion Program, the New York Stock
Exchange Medallion Signature Guarantee Program or the Stock Exchange Medallion
Program (any such bank, broker, dealer, credit union, savings association or
other entity, an "Eligible Institution"). In all other cases, all signatures on
the Letter of Transmittal must be guaranteed by an Eligible Institution. See
Instructions 1 and 5 to the Letter of Transmittal. If the Share Certificates are
registered in the name of a person other than the signer of the Letter of
Transmittal, or if payment is to be made to, or Share Certificates not validly
tendered or not accepted for payment are to be issued or returned to, a person
other than the registered holder of the Share Certificates, the tendered Share
Certificates must be endorsed in blank or accompanied by appropriate stock
powers, signed exactly as the name of the registered holder appears on the Share
Certificates with the signature on such Share Certificates or stock powers
guaranteed by an Eligible Institution. See Instructions 1 and 5 to the Letter of
Transmittal.
GUARANTEED DELIVERY. If a stockholder desires to tender Shares pursuant to
the Offer and such stockholder's Share Certificates are not immediately
available or time will not permit all required documents to reach the Depositary
on or prior to the Expiration Date, or the procedures for book-entry
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<PAGE>
transfer cannot be completed on a timely basis, such Shares may nevertheless be
tendered, provided that all of the following conditions are satisfied:
(i) such tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed Delivery,
substantially in the form made available by Merger Sub, is received by the
Depositary as provided below on or prior to the Expiration Date; and
(iii) the Share Certificates, in proper form for transfer (or Book-Entry
Confirmation with respect to such Shares), together with a properly completed
and duly executed Letter of Transmittal (or facsimile thereof) and any other
documents required by the Letter of Transmittal, are received by the Depositary
within three Nasdaq National Market System ("Nasdaq") trading days after the
date of execution of such Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered by hand, or may be
transmitted by telegram, facsimile transmission or mail, to the Depositary.
Notwithstanding any other provision hereof, payment for Shares tendered and
accepted for payment pursuant to the Offer will in all cases be made only after
timely receipt by the Depositary of (i) Share Certificates (or a timely
Book-Entry Confirmation with respect thereto), (ii) a properly completed and
duly executed Letter of Transmittal (or facsimile thereof) or, in the case of
Book-Entry Transfer, an Agent's Message and (iii) any other documents required
by the Letter of Transmittal.
DETERMINATION OF VALIDITY. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance for payment of any tender
of Shares will be determined by Merger Sub, in its sole discretion, which
determination shall be final and binding. Merger Sub reserves the absolute right
to reject any or all tenders of any particular Shares that it determines are not
in proper form or the acceptance for payment of which may, in the opinion of
Merger Sub's counsel, be unlawful. Merger Sub also reserves the absolute right
to waive any of the conditions of the Offer or to waive any defect or
irregularity in the tender of any Shares with respect to any particular
stockholder, whether or not similar defects or irregularities are waived in the
case of other stockholders. No tender of any Shares will be deemed to have been
validly made until all defects and irregularities have been cured or waived.
None of Merger Sub, Parent, the Depositary, the Information Agent or any other
person will be under any duty to give notice of any defects or irregularities in
tenders or incur any liability for failure to give any such notice. Merger Sub's
interpretation of the terms and conditions of the Offer (including the Letter of
Transmittal and the instructions thereto) will be final and binding.
OTHER REQUIREMENTS. By executing a Letter of Transmittal as set forth
herein, a tendering stockholder irrevocably appoints designees of Merger Sub as
such stockholder's proxies, each with full power of substitution, in the manner
set forth in the Letter of Transmittal to the full extent of such stockholder's
rights with respect to the Shares tendered by such stockholder and accepted for
payment by Merger Sub (and with respect to any and all other Shares or other
securities issued or issuable in respect of such Shares on or after April 28,
1999), effective when, if and to the extent that Merger Sub accepts such Shares
for payment pursuant to the Offer. All such proxies shall be considered coupled
with an interest in the tendered Shares. Such appointment is effective when, and
only to the extent that, Merger Sub accepts such Shares for payment. Upon such
acceptance for payment, all prior proxies given by such stockholder with respect
to such Shares will, without further action, be revoked, and no subsequent
proxies may be given nor any subsequent written consent executed by such
stockholder with respect to such Shares (and if given or executed, will not be
deemed to be effective). The designees of Merger Sub will be empowered, with
respect to such Shares for which the appointment is effective, to exercise all
voting and other rights (whether by written consent or otherwise) of such
stockholder as they, in their sole discretion, may deem proper at any annual or
special meeting of the Company's stockholders or any adjournment of postponement
thereof, by written consent in lieu of any such meeting or otherwise. Merger Sub
reserves the right to
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<PAGE>
require that, in order for Shares to be deemed validly tendered, immediately
upon Merger Sub's payment for such Shares Merger Sub must be able to exercise
full voting rights with respect to such Shares.
Merger Sub's acceptance for payment of Shares tendered pursuant to any of
the procedures described above will constitute a binding agreement between the
tendering stockholder and Merger Sub upon the terms and subject to the
conditions of the Offer.
TO PREVENT BACKUP FEDERAL INCOME TAX WITHHOLDING ON PAYMENTS OF CASH
PURSUANT TO THE OFFER, A STOCKHOLDER TENDERING SHARES IN THE OFFER MUST PROVIDE
THE DEPOSITARY WITH SUCH STOCKHOLDER'S CORRECT TAXPAYER IDENTIFICATION NUMBER
("TIN") ON A SUBSTITUTE FORM W-9 AND CERTIFY UNDER PENALTIES OF PERJURY THAT
SUCH TIN IS CORRECT AND THAT SUCH STOCKHOLDER IS NOT SUBJECT TO BACKUP
WITHHOLDING. All stockholders tendering Shares pursuant to the Offer should
complete and sign the Substitute Form W-9 included as a part of the Letter of
Transmittal to provide the information and certification necessary for
stockholders not subject thereto to avoid backup withholding. Noncorporate
foreign stockholders should complete and sign a Form W-8, Certificate of Foreign
Status, a copy of which may be obtained from the Depositary, in order to avoid
backup withholding. See Instruction 9 to the Letter of Transmittal.
SECTION 4. WITHDRAWAL RIGHTS.
Tenders of Shares made pursuant to the Offer are irrevocable except as
otherwise provided in this Section 4. Shares tendered pursuant to the Offer may
be withdrawn at any time prior to the Expiration Date. Shares may also be
withdrawn at any time after July 5, 1999 unless theretofore accepted for payment
as provided herein. If Merger Sub extends the Offer or if Merger Sub is delayed
in its acceptance for payment of Shares or is unable to accept Shares for
payment pursuant to the Offer for any reason, then, without prejudice to Merger
Sub's rights under the Offer, the Depositary may nevertheless, on behalf of
Merger Sub, retain tendered Shares, and such Shares may not be withdrawn except
to the extent that tendering stockholders properly withdraw such Shares as set
forth in this Section 4.
For a withdrawal to be effective, a written, telegraphic, telex or facsimile
transmission notice of withdrawal must be timely received by the Depositary at
its address specified on the back cover page of this Offer to Purchase. Any
notice of withdrawal must specify the name of the person who tendered the Shares
to be withdrawn, the number of Shares to be withdrawn and (if Share Certificates
for such Shares have been tendered) the names in which the Share Certificate(s)
representing such Shares are registered, if different from that of the person
tendering such Shares. If Share Certificate(s) have been delivered or otherwise
identified to the Depositary, then, prior to the physical release of such Share
Certificate(s), the serial numbers shown on such Share Certificate(s) must be
submitted to the Depositary and, unless such Shares have been tendered by an
Eligible Institution, the signature(s) on the notice of withdrawal must be
guaranteed by an Eligible Institution. If Shares to be withdrawn have been
tendered pursuant to the procedure for book-entry transfer as set forth in
Section 3, any notice of withdrawal of such Shares must specify the name and
number of the account at the Book-Entry Transfer Facility and otherwise comply
with the Book-Entry Transfer Facility's procedures for withdrawal.
Withdrawals of tenders of Shares may not be rescinded, and any Shares
properly withdrawn will thereafter be deemed not validly tendered for purposes
of the Offer. However, properly withdrawn Shares may be retendered at any
subsequent time prior to the Expiration Date by following any of the procedures
set forth in Section 3.
All questions as to the form and validity (including time of receipt) of any
notice of withdrawal will be resolved by Merger Sub, in its sole discretion,
which resolution shall be final and binding. None of Merger Sub, Parent, the
Depositary, the Information Agent or any other person will be under any duty to
give notice of any defects or irregularities in any notice of withdrawal or
incur any liability for failure to give any such notice.
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<PAGE>
SECTION 5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES.
The summary of federal income tax consequences set forth below is for
general information only and is based on Merger Sub's understanding of the law
as currently in effect. The tax consequences to each stockholder will depend in
part upon such stockholder's particular situation. Special tax consequences not
described herein may be applicable to particular classes of taxpayers, such as
financial institutions, broker-dealers, persons who are not citizens or
residents of the United States, stockholders who acquired their Shares through
the exercise of an employee stock option or otherwise as compensation and other
stockholders who do not hold their Shares as capital assets. ALL STOCKHOLDERS
SHOULD CONSULT WITH THEIR OWN TAX ADVISORS AS TO THE PARTICULAR TAX CONSEQUENCES
OF THE OFFER AND THE MERGER TO THEM, INCLUDING THE APPLICABILITY AND EFFECT OF
THE ALTERNATIVE MINIMUM TAX AND ANY STATE, LOCAL OR FOREIGN INCOME AND OTHER TAX
LAWS AND OF CHANGES IN SUCH TAX LAWS.
The receipt of cash for Shares pursuant to the Offer or in the Merger will
be a taxable sale or exchange for U.S. federal income tax purposes under the
Internal Revenue Code of 1986, as amended (the "Code"), and may also be a
taxable transaction under applicable state, local or foreign tax laws. In
general, a stockholder who receives cash for Shares pursuant to the Offer or the
Merger will recognize gain or loss for U.S. federal income tax purposes equal to
the difference between the amount of cash received in exchange for the Shares
sold and such stockholder's adjusted tax basis in such Shares. Assuming the
Shares constitute capital assets in the hands of the stockholder, such gain or
loss will be capital gain or loss and will be long term capital gain or loss if
the stockholder has held the Shares for more than one year at the time of sale.
Under current law, gain or loss will be calculated separately for each Share or,
where applicable, block of Shares (i.e., a group of Shares with the same tax
basis and holding period) tendered pursuant to the Offer.
A stockholder (other than certain exempt stockholders including, among
others, all corporations and certain foreign individuals and entities) that
tenders Shares may, although not otherwise subject to backup withholding be
subject to backup withholding, if the stockholder fails to provide its TIN,
fails to certify that such number is correct or properly certify that it is
awaiting a TIN or if the Internal Revenue Service (the "IRS") notifies the
Depositary that the TIN is incorrect. A stockholder who does not furnish its TIN
may be subject to a penalty imposed by the IRS. See Section 3.
If backup withholding applies to a stockholder, the Depositary is required
to withhold 31% from payments to such stockholder. Backup withholding is not an
additional tax. Rather, the amount of the backup withholding can be credited
against the federal income tax liability of the person subject to the backup
withholding, provided that the required information is given to the IRS. If
backup withholding results in an overpayment of tax, a refund can be obtained by
the stockholder upon filing an appropriate income tax return.
THE FOREGOING DISCUSSION MAY NOT BE APPLICABLE TO CERTAIN TYPES OF
STOCKHOLDERS, INCLUDING STOCKHOLDERS WHO ACQUIRED SHARES PURSUANT TO THE
EXERCISE OF EMPLOYEE STOCK OPTIONS OR OTHERWISE AS COMPENSATION, INDIVIDUALS WHO
ARE NOT CITIZENS OR RESIDENTS OF THE UNITED STATES AND FOREIGN CORPORATIONS.
9
<PAGE>
SECTION 6. PRICE RANGE OF THE SHARES.
The Class A Shares have been listed and principally traded on the Nasdaq
National Market System ("Nasdaq") under the symbol "CMPX" since July 25, 1997.
The following table sets forth, for the periods indicated, the high and low
sales prices per Class A Share as reported by Nasdaq:
<TABLE>
<CAPTION>
HIGH LOW
--------- ---------
<S> <C> <C>
Year Ended December 31, 1997:
First Quarter.............................................................. $ -- $ --
Second Quarter............................................................. -- --
Third Quarter.............................................................. 29.38* 23.25*
Fourth Quarter............................................................. 26.88 13.75
Year Ended December 31, 1998:
First Quarter.............................................................. $ 28.5 $ 15.88
Second Quarter............................................................. 27.5 11.50
Third Quarter.............................................................. 21.13 7.75
Fourth Quarter............................................................. 18.75 7.88
Year Ending December 31, 1999:
First Quarter.............................................................. $ 34.00 $ 14.75
Second Quarter (through May 4, 1999)....................................... 39.13 29.25
</TABLE>
- ------------------------
* Third quarter 1997 includes July 25, 1997 through September 30, 1997
As of May 4, 1999, there were approximately 1,544 holders of record of the
Class A Shares and 14 holders of record of the Class B Shares.
On April 28, 1999, the last full trading day prior to the approval of the
Merger Agreement by the Board and the announcement of the execution of the
Merger Agreement, the closing sales price on Nasdaq was $33.875 per Class A
Share.
STOCKHOLDERS ARE URGED TO OBTAIN A CURRENT MARKET QUOTATION FOR THE CLASS A
SHARES.
SECTION 7. CERTAIN INFORMATION CONCERNING THE COMPANY.
Except as otherwise set forth herein, the information concerning the Company
contained in this Offer to Purchase, including financial information, has been
furnished by the Company or has been taken from, or based upon, publicly
available documents and records on file with the SEC and other sources.
Stockholders are urged to review the publicly available information concerning
the Company before acting on the Offer. Neither Merger Sub, Parent nor any of
their respective affiliates assumes any responsibility for the accuracy or
completeness of the information concerning the Company furnished by the Company
or contained in such documents and records or for any failure by the Company to
disclose events which may have occurred or may affect the significance or
accuracy of any such information but which are unknown to Merger Sub, Parent or
their respective affiliates.
GENERAL.
The Company is a leading technology media company that provides information
products and services to the builders, sellers and users of technology
worldwide. The Company has published magazines and newspapers about technology
for more than 27 years. In terms of total print advertising pages, it is now the
largest technology publisher in the U.S. according to Inquiry Management
Systems, an independent ad-tracking firm. In recent years, the Company has
expanded its publishing activities into foreign countries as well as onto the
World Wide Web.
10
<PAGE>
Of the three largest U.S. technology publishers, the Company is the only one
which serves the broad spectrum of builders, sellers and users of technology.
The Company believes that publishing for audiences across the spectrum of
builders, sellers and users enables it to offer advertisers a one-stop
purchasing opportunity which capitalizes on their need to reach audiences in
multiple markets. The "builders" of technology include manufacturers, engineers,
designers and purchasers of electronic systems and components, including
computers, telecommunications equipment, semiconductors, software, peripherals
and related products. The "sellers" include distributors, value-added resellers,
retailers, systems integrators, dealers, consultants, computer superstores, mass
merchandisers, warehouse clubs, consumer electronics retailers and mail-order
sellers. The "users" include the end-users of information systems,
telecommunications systems, computer systems, personal computers, software, the
Internet and related products and services, including information systems
executives, network communications and departmental applications managers, and
Internet and intranet managers. The technology sector of the U.S. publishing
industry has experienced substantial growth as technology has become
increasingly integrated into business and consumer products and the demand for
technology information and analysis has increased.
The Company's principal executive offices are located at 600 Community
Drive, Manhasset, New York, and its telephone number is (516) 562-5000.
FINANCIAL INFORMATION.
Holders of Class A Share and Class B Shares vote together as a single class
as follows: holders of Class A Shares are entitled to one vote for each such
share held and holders of Class B Shares are entitled to ten votes for each such
share held. Dividends may be paid out of legally available funds if declared by
the Board of Directors and are payable equally to each class of Common Stock.
Each Class B Share is convertible, at the option of the holder, into one Class A
Share. Each Class B Share automatically will be converted into one Class A Share
upon the acquisition thereof in certain circumstances, and will be so converted
upon acquisition of such Class B Shares by Merger Sub pursuant to the Offer.
CMP MEDIA INC.
SELECTED CONSOLIDATED FINANCIAL INFORMATION
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31,
----------------------------------
<S> <C> <C> <C>
1998 1997 1996
---------- ---------- ----------
<CAPTION>
(IN THOUSANDS, EXCEPT PER SHARE
AMOUNTS)
<S> <C> <C> <C>
Statement of Income Data:
Revenue................................................................ $ 477,561 $ 473,851 $ 418,059
Income from operations................................................. 16,036 34,887 28,805
Net income............................................................. 10,005 30,287 26,859
Net income per share--basic............................................ 0.43
Net income per share--diluted.......................................... 0.42
Pro forma net income (1)............................................... 17,336 16,056
Pro forma net income per share--basic (1).............................. 0.77 0.72
Pro forma net income per share--diluted (1)............................ 0.75 0.72
</TABLE>
<TABLE>
<CAPTION>
AS OF DECEMBER 31,
-------------------------------
<S> <C> <C> <C>
1998 1997 1996
--------- --------- ---------
<CAPTION>
(IN THOUSANDS)
<S> <C> <C> <C>
Balance Sheet Data:
Working capital................................................................ $ 37,300 $ 50,992 $ 11,865
Total assets................................................................... 202,262 197,709 123,935
Total long-term debt........................................................... -- -- 25,000
Stockholders' equity........................................................... 107,507 96,596 16,713
</TABLE>
11
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- ------------------------
(1) During 1997, the Company completed its initial public offering and elected
to change its tax status from an S corporation to a C corporation. Pro forma
net income and pro forma net income per share data are presented as if the
Company had changed its tax status to a C corporation prior to January 1,
1996.
In connection with the review by MF Worldwide of the Company and in the
course of the discussions between MF Worldwide and the Company described in
Section 10, the Company provided MF Worldwide with certain business and
financial information that Merger Sub and Parent believe is not publicly
available. For the year ended December 31, 1999, the Company budgeted revenue of
$509.0 million and earnings before income taxes, depreciation and amortization
of $46.2 million.
PROJECTED INFORMATION OF THIS TYPE IS BASED ON ESTIMATES AND ASSUMPTIONS
ABOUT COMPLEX ECONOMIC AND OPERATING FACTORS THAT ARE INHERENTLY SUBJECT TO
SIGNIFICANT ECONOMIC AND COMPETITIVE UNCERTAINTIES AND CONTINGENCIES, ALL OF
WHICH ARE DIFFICULT TO PREDICT AND MANY OF WHICH ARE BEYOND THE COMPANY'S
CONTROL. ACCORDINGLY, THERE IS NO ASSURANCE THAT THE PROJECTED RESULTS WOULD BE
REALIZED OR THAT ACTUAL RESULTS WOULD NOT BE SIGNIFICANTLY HIGHER OR LOWER THAN
THOSE SET FORTH ABOVE. IN ADDITION, THESE PROJECTIONS WERE NOT PREPARED WITH A
VIEW TO PUBLIC DISCLOSURE OR COMPLIANCE WITH THE PUBLISHED GUIDELINES OF THE SEC
OR THE GUIDELINES ESTABLISHED BY THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC
ACCOUNTANTS REGARDING PROJECTIONS AND FORECASTS AND ARE INCLUDED IN THIS OFFER
TO PURCHASE ONLY BECAUSE SUCH INFORMATION WAS MADE AVAILABLE TO MERGER SUB AND
PARENT BY THE COMPANY. NONE OF MERGER SUB, PARENT, THE COMPANY, ANY OF THEIR
RESPECTIVE AFFILIATES OR ANY OTHER PARTY ASSUMES ANY RESPONSIBILITY FOR THE
ACCURACY OR VALIDITY OF THE FOREGOING PROJECTIONS.
The Company is subject to the informational requirements of the Exchange Act
and in accordance therewith files reports, proxy statements and other
information with the SEC. The reports, proxy statements and other information
filed by the Company with the SEC should be available for inspection at the
public reference facilities of the SEC at Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549, and should also be available for inspection and
copying at prescribed rates at the SEC's Regional Offices at 7 World Trade
Center, 13th Floor, New York, New York 10048, and 500 West Madison Street, Suite
1400, Chicago, Illinois 60661. Such reports, proxy statements and other
information also may be obtained at the Web site that the SEC maintains at
http://www.sec.gov. Copies of this material may also be obtained by mail, upon
payment of the SEC's customary fees, from the SEC's principal office at 450
Fifth Street, N.W., Washington, D.C. 20549.
Merger Sub and Parent have filed a Tender Offer Statement on Schedule 14D-1
(together with any amendments thereto, the "Schedule 14D-1") with the SEC in
connection with the Offer. This Offer to Purchase does not contain all the
information set forth in the Schedule 14D-1 and the exhibits thereto. Such
additional information may be obtained from the SEC's principal office in
Washington, D.C. Statements contained in this Offer to Purchase or in any
document incorporated in this Offer to Purchase by reference as to the contents
of any contract or other document referred to herein or therein are not
necessarily complete, and in each instance reference is made to the copy of such
contract or other document filed as an exhibit to the Schedule 14D-1 or such
other document, each such statement being qualified in all respects by such
reference.
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<PAGE>
SECTION 8. CERTAIN INFORMATION CONCERNING MERGER SUB AND PARENT.
MERGER SUB AND PARENT. Both Merger Sub and Parent are newly incorporated
Delaware corporations organized in connection with the Offer and the Merger and
have not carried on any activities other than in connection with the Offer and
the Merger. The principal offices of Merger Sub and Parent are located at 32
Union Square East, 5th Floor South, New York, NY 10003, and their telephone
number at that address is (212) 358-6750. Merger Sub is a direct wholly-owned
subsidiary of Parent. Until immediately prior to the time that Merger Sub will
purchase Shares pursuant to the Offer, it is anticipated that neither Merger Sub
nor Parent will have any significant assets or liabilities or engage in
activities other than those incident to its formation and capitalization and the
transactions contemplated by the Offer and the Merger. Because Merger Sub and
Parent are newly formed and have minimal assets and capitalization, no
meaningful financial information regarding Merger Sub and Parent is available.
UNITED NEWS & MEDIA PLC. Parent, Merger Sub and MF Worldwide are
wholly-owned indirect subsidiaries of United, an English public limited company,
a leading trade exhibition organizer, business magazine and advertising
periodical publisher and corporate news distributor. Within the United Kingdom,
United also is a leading national newspaper publisher and has significant
broadcasting operations.
The name, current business address, citizenship, and present principal
occupation or employment, and five-year employment history for each of the
directors and executive officers of Merger Sub, Parent and United, and certain
other information, are set forth on Schedule I hereto.
United is subject to certain limited informational filing requirements of
the Exchange Act as a foreign private issuer, and in accordance therewith is
obligated to file periodic reports and other information with the SEC relating
to its business, financial statements and other matters. Such reports and other
information filed by United are available for inspection and copying at the
public reference facilities of the SEC in the same places and in the same manner
as set forth with respect to the Company in Section 7, except that such
documents are not available on the SEC's Web site.
For the year ended December 31, 1997, United had revenues of approximately
$3.7 billion and profit after tax of approximately $472.5 million. United's
stockholders' equity at June 30, 1998 was approximately $1,743.7 million with
approximately $502.1 million of cash and cash equivalents.
United's consolidated balance sheet and the related consolidated profit and
loss account and consolidated cash flow statement for the three years ended
December 31, 1997, 1996 and 1995 contained in Part IV, Item 19 of United's
Annual Report on Form 20-F for the year ended December 31, 1997 filed with the
SEC (the "Annual Report") are hereby incorporated by reference. A copy of the
Annual Report may be obtained (i) by writing to United at Ludgate House, 245
Blackfriars Road, London SE1 9UY, United Kingdom, attention: Corporate Secretary
or (ii) upon payment of the SEC's customary fees, by writing to its principal
office at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549.
Additionally, the Annual Report may be inspected at the SEC's offices.
Except as provided in the Merger Agreement, the Tender and Voting Agreement
and as otherwise described in this Offer to Purchase, (i) none of Merger Sub,
Parent nor, to the knowledge of Merger Sub and Parent, any of the persons listed
in Schedule I to this Offer to Purchase, or any associate or majority-owned
subsidiary of Merger Sub, Parent or any of the persons so listed beneficially
owns or has any right to acquire, directly or indirectly, any Shares or has any
contract, arrangement, understanding or relationship with any other person with
respect to any securities of the Company, including, but not limited to, any
contract, arrangement, understanding or relationship concerning the transfer or
the voting of such securities, joint ventures, loan or option arrangements, puts
or calls, guaranties of loans, guaranties against loss or the giving or
withholding of proxies and (ii) none of Merger Sub, Parent nor, to the knowledge
of Merger Sub and Parent, any of the persons or entities referred to above nor
any director, executive officer or subsidiary of any of the foregoing has
effected any transactions in any Shares during the past 60 days.
13
<PAGE>
Except as provided in the Merger Agreement, the Tender and Voting Agreement
and as otherwise described in this Offer to Purchase, since July 25, 1997, the
date of the initial public offering of the Class A Shares, none of Merger Sub,
Parent nor to the knowledge of Merger Sub and Parent, any of the persons listed
in Schedule I to this Offer to Purchase, has had any transactions with the
Company or any of its executive officers, directors or affiliates that is
required to be reported under the rules and regulations of the SEC applicable to
the Offer. Except as provided in the Merger Agreement, the Tender and Voting
Agreement and as otherwise outlined in this Offer to Purchase, since July 25,
1997, there have been no contacts, negotiations or transactions between any of
Merger Sub, Parent, or any of their subsidiaries or, to the best knowledge of
Merger Sub and Parent, any of the persons listed in Schedule I to this Offer to
Purchase, on the one hand, and the Company or its affiliates, on the other hand,
concerning a merger, consolidation or acquisition, a tender offer for or other
acquisition of securities of any class of the Company, an election of directors
of the Company, or a sale or other transfer of a material amount of assets of
the Company or any of its subsidiaries.
SECTION 9. FINANCING OF THE OFFER AND THE MERGER.
The total amount of funds required by Merger Sub to acquire all of the
outstanding Shares pursuant to the Offer, consummate the Merger and pay fees and
expenses related to the Offer and the Merger is estimated to be approximately
$954 million. See "Fees and Expenses." Merger Sub will obtain all such funds
from United and its subsidiaries. To provide such funds, United and its
subsidiaries will use a combination of (i) cash on hand, working capital and
other internally-generated funds and (ii) borrowings under a proposed bridge
loan facility with Lloyds Bank Plc. The Offer is not conditioned upon Merger Sub
receiving any financing.
United entered into a commitment letter dated April 29, 1999 with Lloyds
Bank Plc (the "Commitment Letter") which contemplates that United (or a
subsidiary of United, if guaranteed by United), subject to the execution of a
definitive loan agreement, may borrow up to $800 million under a bridge loan
facility to be used solely for financing the acquisition of the Company.
Interest under the bridge loan facility will be 0.50% per annum over LIBOR. If
the borrower does not repay the bridge loan facility by August 31, 1999, United
will be obligated to repay it by drawing down available credit under its
existing credit facility, for which Lloyds Bank Plc is the facility agent.
United expects to repay the bridge loan facility from funds generated
internally by United and its subsidiaries (including, after the Merger, funds
generated by the Surviving Corporation) and through other sources which may
include the proceeds of future bank financings, the public or private sale of
debt or equity securities or a combination thereof. No decisions have been made,
however, concerning the method United and its subsidiaries will employ to repay
such indebtedness. Such decisions, when made, will be based on United's review
from time to time of the advisability of particular actions, as well as on
prevailing interest rates and financial and other economic conditions.
The foregoing description of the Commitment Letter is qualified in its
entirety by reference to the text of the Commitment Letter filed as Exhibit (b)
to the Schedule 14D-1 and is incorporated herein by reference.
14
<PAGE>
SECTION 10. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY; MERGER
AGREEMENT; TENDER AND VOTING AGREEMENT.
BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY.
Beginning in December 1998, the Executive Committee of the Company's Board
of Directors, in consultation with other members of the Company's Board of
Directors and senior management of the Company, began the process of considering
the exploration of various strategic alternatives for the Company, including but
not limited to a sale or merger of the Company, in order to maximize stockholder
value and expand the Company's ability to provide new products and services to
its customers. On December 17, 1998, representatives of Lazard Freres & Co. LLC
("Lazard Freres"), which previously had served as a financial advisor to the
Company, made a presentation to the Executive Committee and certain members of
the Company's senior management regarding strategic alternatives for the
Company. At that point, the range of possible transactions considered included
the restructuring of parts of the Company's businesses, an acquisition or joint
venture with respect to one or more of the Company's publication groups, or an
outright acquisition of the Company. On December 24, 1999, representatives of
Lazard Freres and the Company held a conference call in order to start gathering
information regarding the Company in connection with the possible exploration of
strategic alternatives.
On January 7, 1999, the members of the Executive Committee, together with
certain members of the Company's senior management, met with representatives of
Lazard Freres and Dow, Lohnes & Albertson, PLLC, the Company's legal counsel
("DL&A"), to discuss possible strategic alternatives and the process by which
the Company could solicit expressions of interest from potential strategic and
financial parties. Lazard Freres' engagement to act as financial advisor to the
Company in connection with this exploration of strategic alternatives, and to
conduct an organized marketing process in that connection, was formally
evidenced by an engagement agreement with the Company entered into as of January
25, 1999. At a meeting of the Board of Directors on February 9, 1999, the
Company's Board of Directors gave final approval to the Company's exploration of
strategic alternatives.
On February 10, 1999, the Company issued a press release announcing the
retention of Lazard Freres and the Company's decision to explore strategic
alternatives, including but not limited to a sale or merger. As part of the
process of exploring the Company's strategic options, the Company's senior
management had prepared in late January 1999 and early February 1999, in
conjunction with Lazard Freres, a collection of evaluation materials for
distribution on a confidential basis to potentially interested parties. Between
February 10, 1999 and March 3, 1999, Lazard Freres contacted a total of 75
parties, including strategic and financial buyers, that Lazard Freres and the
Company believed would be most likely to have a potential interest in the
Company. Of these parties, 37 requested additional information and were sent the
confidential evaluation materials concerning the Company. During this period,
representatives of Lazard Freres and DL&A entered into negotiation of
confidentiality agreements with parties interested in receiving evaluation
materials on the Company. As part of this process, the Company and United
entered into a confidentiality agreement on February 19, 1999 with respect to
the evaluation materials. The Company and Lazard Freres also held a number of
meetings in February 1999 and March 1999 in order to prepare for management
presentations and to gather data room information that would be made available
to the selected potential buyers.
On February 26, 1999, Lazard Freres sent a letter to interested parties
requiring non-binding preliminary indications of interest by March 16, 1999. Of
the parties that received the confidential evaluation materials, a number of
parties (including United) expressed interest in pursuing a transaction with the
Company and made non-binding preliminary indications of interest on March 16,
1999. On March 17, 1999, after consultation with the Company, representatives of
Lazard Freres contacted certain of these parties (including United) in order to
inform them that they were invited to proceed with due diligence and to schedule
a time for management presentations by the Company. Arrangements were also
15
<PAGE>
made for the selected parties to obtain access to the Company's data room for
their review of due diligence materials.
From March 23, 1999 to April 2, 1999, the selected parties (including
United) were given presentations by the Company's management and visited the
data room. A number of follow up meetings and conference calls were organized
between representatives of the Company and the interested parties in order to
enable the selected parties to complete their due diligence. On April 12, 1999,
Lazard Freres informed the selected parties that final and binding "last and
best" offers for the Company were due by April 26, 1999.
After the delivery of proposals by the remaining interested parties on April
26, 1999, the Executive Committee consulted with its financial and legal
advisors on April 26, 1999 regarding the status and terms of the proposals
delivered and determined, with the knowledge and approval of the other members
of the Board of Directors, to commence negotiations with representatives of
United and MF Worldwide, which had proposed to make a cash tender offer for all
shares of the Company's Common Stock at $39.00 per share, to be followed by a
merger of Merger Sub and the Company. The Company's financial and legal advisors
met with the financial and legal advisors to United and MF Worldwide on April
27, 1999 to discuss various aspects of the MF Worldwide proposal and issues
relating thereto under the proposed form of Merger Agreement. Among other issues
discussed was the requirement by MF Worldwide that the holders of the Company's
Class B Common Stock (comprised of members of the Leeds Family and certain
controlled trusts and private foundations) enter into the Tender and Voting
Agreement.
All of the members of the Board of Directors of the Company met on April 27,
1999 to discuss the proposals received from the interested parties and, in
particular, the proposal of United and MF Worldwide. DL&A, the Company's legal
advisors, made a presentation to the Board of Directors regarding the terms of
the Merger Agreement and the Tender and Voting Agreement and the Board of
Directors's fiduciary duties in evaluating the transaction. Thereafter, Lazard
Freres made a presentation to the Board of Directors reviewing the process that
led to the proposed offer from United and MF Worldwide, an overview of the
financial terms of such proposed offer and the offers received from other
parties, a summary of the recent performance of the Company and a valuation
summary relating to the Company. On the basis of the material presented, Lazard
Freres indicated that it was prepared to deliver an opinion to the Board of
Directors to the effect that, based upon and subject to the assumptions and
other matters set forth therein, the $39.00 per share cash consideration
proposed to be paid to the Company's stockholders in connection with the Offer
and the Merger was fair to the stockholders of the Company from a financial
point of view (which was subsequently confirmed by Lazard Freres' delivery of a
written opinion dated April 28, 1999 to the Board of Directors). After
discussing the matters referred to above, the members of the Board of Directors
resolved to recess their meeting and to take up the discussion of these matters
the following day.
At the subsequent resumption of the meeting of all of the members of the
Board of Directors on April 28, 1999, the Board of Directors continued its
consideration of the Offer and the Merger. After discussion, the independent
members of the Board of Directors (Richard W. Anderson and Sharon Lee Patrick)
indicated that they approved the forms of the Merger Agreement and the Tender
and Voting Agreement and the consummation of the transactions contemplated
thereby. Thereafter, the full Board of Directors unanimously (i) determined that
the Merger Agreement and the transactions contemplated thereby, including the
Offer and the Tender and Voting Agreement, are fair to, and in the best
interests of, the Company and its stockholders, (ii) approved the Merger
Agreement and the Tender and Voting Agreement and the transactions contemplated
thereby (and exempted Merger Sub from the application of Section 203 of the
Delaware General Corporation Law), and (iii) resolved to recommend that the
Company's stockholders accept the Offer and tender their Shares into the Offer
and approve and adopt the Merger Agreement and the transactions contemplated
thereby.
16
<PAGE>
The Merger Agreement and Tender and Voting Agreement were executed as of
April 28, 1999, and the Company and United issued a joint press release on April
29, 1999 announcing the execution of the agreements.
THE MERGER AGREEMENT.
The following summary of the Merger Agreement is qualified in its entirety
by reference to the Merger Agreement, a copy of which has been filed as an
exhibit to Merger Sub's and Parent's Schedule 14D-1 and 13D.
THE OFFER. The Merger Agreement provides that as promptly as reasonably
practicable after the date of execution of the Merger Agreement, but in no event
later than May 6, 1999, Merger Sub will commence the Offer for all of the
outstanding Shares at a price of not less than $39.00 per Share in cash, net to
the seller, subject to the satisfaction of conditions set forth in Section 14
and, subject only to the terms and conditions of the Offer, will pay, as
promptly as reasonably practicable, after expiration of the Offer for all Shares
duly tendered thereunder and not withdrawn. Merger Sub may waive any condition
to the Offer, increase the price per Share payable in the Offer and make any
other changes in the terms and conditions of the Offer. However, without the
consent of the Company, no change may be made which decreases the price per
Share payable in the Offer or changes the form of consideration payable in the
Offer, which reduces the maximum number of Shares to be purchased in the Offer
or which imposes conditions to the Offer other than those described in Section
14 or which extends the Offer (except as set forth in the following sentence).
Notwithstanding the foregoing, Merger Sub may, without the consent of the
Company, (i) extend the Offer beyond the scheduled expiration date (the initial
scheduled expiration date being 20 business days following the commencement of
the Offer) if, at the scheduled expiration date of the Offer, any of the
conditions to Merger Sub's obligation to accept for payment, and to pay for, the
Shares shall not be satisfied or waived, (ii) extend the Offer for an aggregate
period of not more than 10 business days if, immediately prior to the initial
expiration date of the Offer (as it may be extended), after giving effect to the
automatic conversion of all Class B Shares validly tendered and not withdrawn,
the Class A Shares validly tendered and not withdrawn pursuant to the Offer
equal less than 90% of the outstanding Class A Shares and Merger Sub irrevocably
expressly waives any condition (other than the Minimum Condition, as defined
below) that subsequently may not be satisfied during such extension of the
Offer, or (iii) extend the Offer for any period required by any rule, regulation
or interpretation of the SEC or the staff thereof applicable to the Offer.
THE MERGER. The Merger Agreement provides that, subject to the terms and
conditions thereof, at the Effective Time, Merger Sub will be merged with and
into the Company and the separate corporate existence of Merger Sub will cease.
At the Effective Time, by virtue of the Merger and without any action on the
part of Merger Sub, the Company or the holders of Shares, each Share issued and
outstanding immediately prior to the Effective Time (other than Shares owned by
Merger Sub, Shares owned by the Company (which shall not include any Shares held
by the trust established pursuant to the 1999 Leeds Family/CMP Media Inc.
Employee Benefit Trust Agreement) or any direct or indirect wholly-owned
subsidiary of the Company and Shares that are outstanding immediately prior to
the Effective Time and which are held by stockholders who shall have not voted
in favor of the Merger or consented thereto in writing and who shall have
demanded properly in writing appraisal for such Shares in accordance with
Section 262 of the DGCL) will be converted into the right to receive the Merger
Consideration. Pursuant to the Merger Agreement, each share of common stock, par
value $.01 per share, of Merger Sub issued and outstanding immediately prior to
the Effective Time will be converted into and exchanged for one validly issued,
fully paid and nonassessable share of common stock of the Surviving Corporation.
CERTIFICATE OF INCORPORATION AND BY-LAWS The Certificate of Incorporation
and By-laws of Merger Sub in effect at the Effective Time shall be the
Certificate of Incorporation of the Surviving Corporation, until duly amended in
accordance with the terms thereof and the DGCL, provided, that the Certificate
of Incorporation and By-laws of the Surviving Corporation will (i) state that
the name of the Surviving
17
<PAGE>
Corporation is "CMP Media Inc." and (ii) for a period of at least six years
after the Effective Time, include indemnification and exculpation provisions
which are at least as favorable to the current officers and directors of the
Company as those contained in the Certificate of Incorporation and By-laws of
the Company as of the date of the Merger Agreement.
NO SOLICITATION. The Company will not, prior to the Effective Time,
directly or indirectly, solicit, initiate or encourage any inquiries or the
making of any proposal with respect to any merger, consolidation or other
business combination involving the Company or its subsidiaries or acquisition of
all or substantially all of the assets or capital stock of the Company and its
subsidiaries taken as a whole (an "Acquisition Transaction") or negotiate,
explore or otherwise engage in substantive discussions with any person (other
than MF Worldwide, Merger Sub or their respective directors, officers,
employees, agents and representatives) with respect to any Acquisition
Transaction or enter into any agreement, arrangement or understanding requiring
it to abandon, terminate or fail to consummate the Merger or any other
transactions contemplated by the Merger Agreement.
DIRECTORS. Promptly upon the purchase by Merger Sub of Shares pursuant to
the Offer, and from time to time thereafter as Shares are acquired by Merger
Sub, Merger Sub shall be entitled to designate such number of directors, rounded
up to the next whole number, on the Company's Board of Directors as will give
Merger Sub, subject to compliance with Section 14(f) of the Exchange Act,
representation on the Board of Directors equal to at least that number of
directors which equals the product of the total number of directors on the Board
of Directors (giving effect to the directors appointed or elected pursuant to
this sentence) multiplied by the percentage obtained by dividing (i) the
aggregate number of votes represented by the Shares beneficially owned by Merger
Sub or any affiliate of Merger Sub by (ii) the number of votes represented by
all Shares outstanding (excluding Shares held by the Company but not excluding
any shares held by the trust established pursuant to the 1999 Leeds Family/CMP
Media Inc. Employee Benefit Trust Agreement). At such times, if requested by
Merger Sub, the Company will also cause each committee of the Board of Directors
to include persons designated by Merger Sub constituting the same percentage of
each such committee as Merger Sub's designees are of the Board of Directors. The
Company shall, upon request by Merger Sub, promptly increase the size of the
Board of Directors or exercise its best efforts to secure the resignations of
such number of directors as is necessary to enable Merger Sub designees to be
elected to the Board of Directors and shall cause Merger Sub's designees to be
so elected; provided, however, that prior to the Effective Time, the Company's
Board of Directors shall always have at least three members who are neither
officers, directors, stockholders or designees of MF Worldwide or Merger Sub or
any of their affiliates ("Outside Directors"). If the number of directors who
are Outside Directors is reduced below three for any reason prior to the
Effective Time, the remaining directors who are Outside Directors (or, if there
is only one director who is an Outside Director, such Outside Director) shall be
entitled to designate a person (or persons) to fill such vacancy (or vacancies)
who is an Outside Director and who shall be a director deemed to be an Outside
Director for all purposes of the Merger Agreement.
DIRECTORS' AND OFFICERS' INDEMNIFICATION. The Merger Agreement provides
that, from and after the Effective Time, MF Worldwide shall cause the Surviving
Corporation to fulfill and honor in all respects the obligations of the Company
pursuant to certain existing indemnification agreements of the Company in favor
of the directors and officers of the Company. Also pursuant to the Merger
Agreement, for a period of six years after the Effective Time, MF Worldwide
shall cause the Surviving Corporation to use its commercially reasonable efforts
to maintain in effect, if available, directors' and officers' liability
insurance and employed lawyers professional liability insurance covering those
persons who are currently or at the Effective Time covered by the Company's
policies for such insurance on terms comparable to those applicable to the
current policies for such insurance; provided, however, that in no event shall
MF Worldwide or the Surviving Corporation be required to expend in excess of
200% of the annual premium currently paid by the Company for such coverage (or
obtain coverage in excess of the coverage that is available for such 200% of
such annual premium).
18
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COMPANY OPTIONS. The Merger Agreement provides that, with respect to all
outstanding options or warrants (referred to collectively as the "Options" and
individually as an "Option") to purchase to acquire Shares (except for any
vested or unvested Options held by Michael S. Leeds or Daniel H. Leeds, which
shall be canceled prior to the expiration date of the Offer without payment
therefor except as provided in their respective employment agreements), each
holder of an Option which is surrendered by the holder for cancellation shall be
entitled to receive from the Company, immediately prior to the closing of the
Offer, for each Share purchasable under each Option, an amount in cash in full
cancellation of such Option equal to the excess of the Cash Price over the per
share exercise price of such Option (or such greater amount as Merger Sub shall
agree in writing), as such amount may be reduced by any required withholding in
accordance with applicable tax laws. The Company agrees to use all commercially
reasonable efforts to obtain prior to the expiration date of the Offer written
agreements of all holders of Options legally binding such holders to
cancellation of such Options consistent with the foregoing.
MATERIAL TRANSACTIONS. The Merger Agreement provides that, prior to the
Merger, the Company will not (other than as required pursuant to the terms of
the Merger Agreement and the related documents) without first obtaining the
written consent of MF Worldwide, enter into any transactions outside of the
ordinary course of business of the Company or:
(a) encumber any asset or enter into any transaction or make any contract or
commitment relating to the properties, assets and business of the Company or any
subsidiary, other than in the ordinary course of business or as otherwise
disclosed in the Merger Agreement;
(b) enter into any employment contract which is not terminable at will or
upon notice of 30 days or less and without penalty to the Company or any
subsidiary except as provided in the Merger Agreement;
(c) issue or sell, or agree to issue or sell, any shares of capital stock or
other securities of the Company, except upon exercise of currently outstanding
stock options or warrants;
(d) except as set forth in the Merger Agreement or as may be required to
comply with applicable law, become obligated under any new pension plan, welfare
plan, multi-employer plan, employee benefit plan, severance plan, benefit
arrangement or similar plan or arrangement which is not in existence on the date
hereof, or amend any such plan or arrangement in existence on the date hereof if
such amendment would have the effect of materially increasing the costs thereof
to the Company or any of its affiliates;
(e) declare, set aside or pay any dividend or other distribution (whether in
cash, securities or property or any combination thereof) in respect of any class
or series of its capital stock other than between the Company and any of its
wholly-owned subsidiaries;
(f) split, combine, subdivide, reclassify or redeem, purchase or otherwise
acquire, or propose to redeem, purchase or otherwise acquire, any shares of its
capital stock, or any of its other securities;
(g) (i) incur, assume or pre-pay any long-term debt or incur or assume any
short-term debt, except that the Company and the Company Subsidiaries may incur,
assume or pre-pay debt in the ordinary course of business consistent with past
practice under existing lines of credit, (ii) assume, guarantee, endorse or
otherwise become liable or responsible (whether directly, contingently or
otherwise) for the obligations of any other person or entity except in the
ordinary course of business, or (ii) make any loans, advances or capital
contributions to, or investments in, any other person or entity except in the
ordinary course of business and except for loans, advances or capital
contributions to or investments in any wholly-owned subsidiary of the Company;
(h) issue any stock option under any Plan or any other options, warrants,
convertible securities or other capital stock, and (except as contemplated by
Section 3.1(d) of the Merger Agreement) will not accelerate the vesting or
otherwise modify the terms of any option outstanding under any Plan;
(i) take any action to institute any severance or termination pay practices
with respect to any directors, officers, or employees of the Company or any
subsidiaries other than those in effect on the date hereof, or
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to increase the benefits payable under its severance or termination pay
practices in effect on the date hereof;
(j) adopt or amend, in any material respect, except as may be required by
applicable law or regulation, any collective bargaining, bonus, profit sharing,
compensation, stock option, restricted stock, pension, retirement, deferred
compensation, employment or other employee benefit plan, agreement, trust, fund,
plan or arrangement for the benefit or welfare of any directors, officers or
employees of the Company, or any subsidiaries, or make any increase in the
salaries, compensation or pay scales of any such directors, officers or
employees; or
(k) amend its certificate of incorporation or bylaws.
The Company will permit two designated representatives of MF Worldwide to be
present on a full-time basis at the principal offices of the Company to observe
the conduct of the business of the Company, and the Company will consult with
such representatives prior to taking any actions outside the ordinary course of
the Company's business in any material respect or any actions specified above.
CONDITIONS TO THE OBLIGATIONS OF EACH PARTY. The Merger Agreement provides
that the respective obligations of each party to consummate the Merger are
subject to the satisfaction of a number of conditions, including, but not
limited to, the following conditions (any of which may be waived in writing by
MF Worldwide and the Company):
(a) None of MF Worldwide, Merger Sub or the Company, nor any of their
respective subsidiaries, shall be subject to any order, decree or injunction by
a court of competent jurisdiction which (i) prevents or materially delays the
consummation of the Merger or (ii) would impose any material limitation on the
ability of MF Worldwide effectively to exercise full rights of ownership of the
common stock of the Surviving Corporation or any material portion of the assets
or business of the Company and its subsidiaries taken as a whole.
(b) No statute, rule, regulation, executive order, decree, injunction or
other order (whether temporary, preliminary or permanent) shall have been
enacted by the government (or any governmental agency) of the United States or
any other country, or any state, municipality or other political subdivision
thereof, that makes the consummation of the Merger and any other transaction
contemplated hereby illegal. All waiting periods, if any, under the HSR Act
relating to the transactions contemplated hereby shall have expired or
terminated early and all material foreign antitrust approvals required to be
obtained prior to the Merger in connection with the transactions contemplated
hereby shall have been obtained.
(c) The requisite holders of Shares shall have approved the adoption of the
Merger Agreement and any other matters submitted to them to the extent required
by, and in accordance with the provisions of, the Merger Agreement.
REPRESENTATIONS AND WARRANTIES. The Merger Agreement contains various
customary representations and warranties of the parties thereto including, but
not limited to, representations by the Company as to corporate organization and
qualification, subsidiaries, capitalization, authority to enter into the Merger
Agreement, filings with the SEC and other governmental authorities, the absence
of certain changes or events, intellectual property, material contracts,
environmental matters, employee benefit matters, the opinion of the Company's
financial advisor, tax returns, audits, brokers and litigation.
GUARANTY BY UNITED. The Merger Agreement includes an unconditional and
irrevocable guaranty by United to the Company of the due and punctual payment
for all Shares in connection with the Offer and the Merger and any other
monetary obligations of MF Worldwide or Merger Sub and the due and punctual
performance of all other obligations of MF Worldwide or Merger Sub to the
Company, all in accordance with the terms of the Merger Agreement.
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TERMINATION OF THE MERGER AGREEMENT. The Merger Agreement may be terminated
and canceled, and the Offer and the Merger may be abandoned at any time prior to
the Effective Time:
(a) by mutual consent of Merger Sub and the Company;
(b) by either MF Worldwide or the Company if, upon a vote at a duly held
meeting of stockholders or any adjournment thereof, any required approval of the
holders of Shares shall not have been obtained;
(c) by either MF Worldwide or the Company if the Merger shall not have been
consummated on or before October 28, 1999, unless the failure to consummate the
Merger is the result of a willful and material breach of the Merger Agreement by
the party seeking to terminate the Merger Agreement;
(d) by either MF Worldwide or the Company if any court of competent
jurisdiction or other governmental entity shall have issued an order or ruling
or taken any other action permanently enjoining, restraining or otherwise
prohibiting the Merger, and such order, decree, ruling or other action shall
have become final and nonappealable;
(e) by either MF Worldwide or the Company in the event of a breach by the
other party of any representation, warranty, covenant or other agreement
contained in the Merger Agreement which (i) would give rise to the failure of a
condition set forth in the Merger Agreement and (ii) cannot be or has not been
cured within 30 days after the giving of written notice to the breaching party
of such breach (a "Material Breach"); provided that the terminating party is not
then in Material Breach of any representation, warranty, covenant or agreement
contained in the Merger Agreement;
(f) by either MF Worldwide or the Company if Merger Sub shall have
terminated the Offer in accordance with its terms and conditions, and otherwise
not in violation of the Merger Agreement, without purchasing any Shares pursuant
thereto;
(g) by either MF Worldwide or the Company in the event that (i) all of the
mutual conditions to the obligation of such party to effect the Merger set forth
in the Merger Agreement shall have been satisfied and (ii) any separate
condition to the obligation of such party to effect the Merger set forth in the
Merger Agreement is not capable of being satisfied prior to October 28, 1999; or
(h) by MF Worldwide, if the Company's Board of Directors shall have (i)
determined to withdraw its recommendation of the Offer or the Merger to the
holders of Shares or (ii) approved, recommended or endorsed any Acquisition
Transaction other than the Merger Agreement or (iii) resolved to do any of the
foregoing.
EXPENSES. All expenses incurred in connection with the Merger Agreement and
the transactions contemplated by the Merger Agreement will be paid by the party
incurring such expenses, whether or not any transaction contemplated by the
Merger Agreement is consummated.
TENDER AND VOTING AGREEMENT
In connection with the execution of the Merger Agreement, Merger Sub entered
into a Tender and Voting Agreement, dated as of April 28, 1999 (the "Tender and
Voting Agreement"), with the holders of all of the outstanding Class B Shares.
Pursuant to the Tender and Voting Agreement, such holders have agreed, among
other things, to tender all such Shares pursuant to the Offer, and not withdraw
such Shares as long as the Tender and Voting Agreement remains in effect, and to
vote such Shares in favor of the adoption of the Merger Agreement and the
transactions contemplated therein, against any Acquisition Transaction and
against any action which would result in any of the conditions of the Company's
obligations under the Merger Agreement not being fulfilled. The Tender and
Voting Agreement also includes covenants by such stockholders to neither dispose
of their Shares, enter into a voting arrangement with respect to their Shares,
nor grant any proxy with respect to their Shares.
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The foregoing summary of the Tender and Voting Agreeement is qualified in
its entirety by reference to the Tender and Voting Agreements, a copy of which
has been filed as an exhibit to the Schedule 14D-1 and 13D of Parent and Merger
Sub.
SECTION 11. PURPOSE OF THE OFFER; PLANS FOR THE SURVIVING CORPORATION AFTER
THE OFFER AND THE MERGER.
PURPOSE OF THE OFFER. The purpose of the Offer and the Merger is for Parent
to acquire control of, and the entire equity interest in, the Company. The
purpose of the Merger is for Parent to acquire all Shares not purchased pursuant
to the Offer. Upon consummation of the Merger, the Surviving Corporation will
become a wholly-owned subsidiary of Parent. The Offer is being made pursuant to
the Merger Agreement.
PLANS FOR MERGER CONSUMMATION. Under the DGCL, the approval of the
Company's Board of Directors and the affirmative vote of the holders of a
majority of the outstanding Shares are required to approve and adopt the Merger
Agreement and the transactions contemplated thereby, including the Merger. The
Company's Board of Directors has unanimously approved and adopted the Merger
Agreement and the transactions contemplated thereby, and the only remaining
required corporate action of the Company is the approval and adoption of the
Merger Agreement and the transactions contemplated thereby by the affirmative
vote of the holders of a majority of the Shares. Accordingly, if the Minimum
Condition is satisfied, Merger Sub will have sufficient voting power to cause
the approval and adoption of the Merger Agreement and the transactions
contemplated thereby without the affirmative vote of any other stockholder.
In the Merger Agreement, the Company has agreed to take all action
necessary, as promptly as practicable after the expiration of the Offer, to
convene a meeting of its stockholders to consider and vote upon the approval of
the Merger Agreement, the Merger and such other matters as may be necessary to
effectuate the transactions contemplated by the Merger Agreement. Merger Sub has
agreed that all Shares owned by it and its subsidiaries will be voted in favor
of the Merger Agreement and the transactions contemplated by the Merger
Agreement at any such meeting.
The Merger Agreement provides that if Merger Sub purchases Shares sufficient
to constitute a majority of the then outstanding Shares, Merger Sub will be
entitled to designate representatives to serve on the Board in proportion to
Merger Sub's ownership of Shares following such purchase constituting at least a
majority of the Board. See Section 10. Merger Sub expects that such
representation would permit Merger Sub to exert control over the conduct of the
Company's business and operations.
Under the DGCL, if Merger Sub acquires, pursuant to the Offer or otherwise,
at least 90% of each class of Shares then outstanding, Merger Sub will be able
to approve and adopt the Merger Agreement and the transactions contemplated
thereby, including the Merger, without a vote of the Company's stockholders. In
such event, Merger Sub and the Company have agreed to take all necessary and
appropriate action to cause the Merger to become effective as soon as reasonably
practicable after such acquisition, without a meeting of the Company's
stockholders. If, however, Merger Sub does not acquire at least 90% of each
class of Shares then outstanding pursuant to the Offer or otherwise and a vote
of the Company's stockholders is required under the DGCL, a significantly longer
period of time will be required to effect the Merger. See Section 10 for a more
detailed description of the Merger. Merger Sub reserves the right, subject to
certain conditions described below, to extend the Offer for up to 10 business
days if less than 90% of the Class A Shares have been tendered.
APPRAISAL RIGHTS. No appraisal rights are available in connection with the
Offer. However, if the Merger is consummated, stockholders will have certain
rights under the DGCL to dissent and demand appraisals of, and to receive
payment in cash of the fair value of their Shares. Such rights to dissent, if
the statutory procedures are complied with, could lead to a judicial
determination of the fair value of the Shares, as of the day prior to the date
on which the stockholders' vote was taken approving the Merger (excluding any
element of value arising from the accomplishment or expectation of the Merger),
required
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to be paid in cash to such dissenting holders for their Shares. In addition,
such dissenting stockholders would be entitled to receive payment of a fair rate
of interest from the date of consummation of the Merger on the amount determined
to be the fair value of their Shares. In determining the fair value of the
Shares, the court is required to take into account all relevant factors.
Accordingly, such determination could be based upon considerations other than,
or in addition to, the market value of the Shares, including, among other
things, asset values and earning capacity. In Weinberger v. UOP, Inc., the
Delaware Supreme Court stated, among other things, that "proof of value by any
techniques or methods which are generally considered acceptable in the financial
community and otherwise admissible in court" should be considered in an
appraisal proceeding. Therefore, the value so determined in any appraisal
proceeding could be the same as or more or less than the purchase price per
Share in the Offer or the Merger Consideration.
PLANS FOR THE SURVIVING CORPORATION. It is expected that, initially
following the Merger, the business and operations of the Surviving Corporation
will, except as set forth in this Offer to Purchase, be continued by the
Surviving Corporation substantially as they are currently being conducted.
Parent will continue to evaluate the business and operations of the Company
during the pendency of the Offer and after the consummation of the Offer and the
Merger, and will take such actions as it deems appropriate under the
circumstances then existing. Parent intends to seek additional information about
the Company during this period. Thereafter, Parent intends to review such
information as part of a comprehensive review of the Company's business,
operations, capitalization, Board and management with a view to optimizing
realization of the Company's potential in conjunction with Parent's businesses.
It is expected that the business and operations of the Surviving Corporation
would form an important part of Parent's future business plans.
Except as indicated in this Offer to Purchase, Parent does not have any
present plans or proposals which relate to or would result in an extraordinary
corporate transaction, such as a merger, reorganization or liquidation involving
the Company, a sale or transfer of a material change in the Company's
capitalization or dividend policy or any other material changes in the Company's
corporate structure or business.
SECTION 12. DIVIDENDS AND DISTRIBUTIONS.
The Merger Agreement provides that the Company will not, between the date of
the Merger Agreement and the Effective Time, without the prior written consent
of Parent, declare or pay any dividends or other distributions in respect of any
of its capital stock.
SECTION 13. EFFECT OF THE OFFER ON MARKET FOR SHARES; NASDAQ LISTING;
REGISTRATION UNDER THE EXCHANGE ACT.
The purchase of Shares by Merger Sub pursuant to the Offer will reduce the
number of Shares that might otherwise trade publicly, may reduce the number of
holders of Shares and could thereby adversely affect the liquidity and market
value of the remaining publicly held Shares.
Depending upon the aggregate market value and per share price of any Shares
not purchased pursuant to the Offer, the Class A Shares may no longer meet the
standards for continued inclusion in Nasdaq, which require, among other things,
that an issuer have at least 200,000 publicly held shares with a market value of
$1 million held by at least 400 stockholders or 300 stockholders holding round
lots. In the event the Class A Shares were no longer eligible for quotation,
quotations might still be available from other sources. The extent of the public
market for the Shares and availability of such quotations would, however, depend
upon the number of holders of Shares remaining at such time, the interest in
maintaining a market in the Shares on the part of securities firms, the possible
termination of registration under the Exchange Act, as described below, and
other factors.
The Shares are currently "margin securities" under the regulations of the
Board of Governors of the Federal Reserve System (the "Federal Reserve Board"),
which has the effect, among other things, of allowing brokers to extend credit
on the collateral of such Shares for the purpose of buying, carrying or
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trading in securities. Depending upon factors similar to those described above
regarding the continued listing, public trading and market quotations of the
Shares, it is possible that following the purchase of the Shares pursuant to the
Offer, the Shares would no longer constitute "margin securities" for purposes of
the Federal Reserve Board's margin regulations, in which event the Shares could
no longer be used as collateral for loans made by brokers.
The Shares are currently registered under the Exchange Act. Such
registration may be terminated upon application by the Company to the SEC if the
Shares are not listed on a national securities exchange and there are fewer than
300 record holders. The termination of the registration of the Shares under the
Exchange Act would substantially reduce the information required to be furnished
by the Company to holders of Shares and to the SEC and would make certain
provisions of the Exchange Act, such as the short-swing profit recovery
provisions of Section 16(b), the requirement of furnishing a proxy statement in
connection with stockholders' meetings and the requirements of Rule 13e-3 under
the Exchange Act with respect to "going private" transactions, no longer
applicable to the Shares. In addition, "affiliates" of the Company and persons
holding "restricted securities" of the Company may be deprived of the ability to
dispose of such securities pursuant to Rule 144 promulgated under the Securities
Act. If registration of the Shares under the Exchange Act were terminated, the
Shares would no longer be "margin securities" or be eligible for Nasdaq
reporting. Merger Sub currently intends to seek to cause the Company to
terminate the registration of the Shares under the Exchange Act as soon after
consummation of the Offer as the requirements for termination of registration
are met.
SECTION 14. CERTAIN CONDITIONS OF THE OFFER.
Notwithstanding any other provision of the Merger Agreement, Merger Sub
shall not be required to accept for payment or pay for any Company Common Stock
tendered, and may terminate or amend the Offer (subject to the provisions of the
Merger Agreement) and may postpone the acceptance of, and payment for, subject
to Rule 14e-1 (c) of the Exchange Act, any Shares tendered, (A) unless the
following conditions shall have been satisfied: (i) there shall be validly
tendered and not withdrawn prior to the expiration of the Offer a number of
Shares which represent on a fully diluted basis (including for purposes of such
calculation all Shares issuable upon exercise of all vested stock options and
warrants and conversion of convertible securities or other rights to purchase or
acquire shares and after giving effect to the conversion of the Class B Shares)
at least 51% of the number and voting power of the Shares then outstanding (the
"Minimum Condition") and (ii) any applicable waiting period under the HSR Act
shall have expired or been terminated prior to the expiration of the Offer or
(B) if at any time after the date of this Agreement and before the time of
payment for any such Shares (whether or not any Shares theretofore have been
accepted for payment or paid for pursuant to the Offer) any of the following
conditions exists:
(a) there shall be in effect an injunction or other order, decree, judgment
or ruling by a court of competent jurisdiction or by a governmental,
regulatory or administrative agency or commission of competent
jurisdiction or a statute, rule, regulation, executive order or other
action or proceeding shall have been promulgated, enacted, taken,
initiated or instituted by a government or a governmental authority or a
governmental, regulatory or administrative agency or commission of
competent jurisdiction which in any such case (i) seeks to restrain or
prohibit the making or consummation of the Offer or the consummation of
the Merger, (ii) seeks to prohibit or restrict in any material respect
the ownership or operation by Merger Sub (or any of its affiliates or
subsidiaries) of any material portion of the Company's business or
assets, or seeks to compel Merger Sub (or any of its affiliates or
subsidiaries) to dispose of or hold separate any material portion of the
Company's business or assets, (iii) seeks to impose material limitations
on the ability of Merger Sub effectively to acquire or to hold or to
exercise full rights of ownership of the Company Common Stock, including,
without limitation, the right to vote the Company Common Stock purchased
by Merger Sub on all matters properly presented to the stockholders of
the
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Company, or (iv) seeks to impose any material limitations on the ability
of Merger Sub or any of its affiliates or subsidiaries effectively to
control in any material respect the business and operations of the
Company; or
(b) the Merger Agreement shall have been terminated by the Company, Merger
Sub or MF Worldwide in accordance with its terms; or
(c) there shall have occurred and be continuing (i) any general suspension
of, or limitation on prices for, trading in securities on any national
securities exchange or the over-the-counter market, (ii) a declaration of
a banking moratorium or any suspension of payments in respect of banks in
the United States, (iii) any limitation (whether or not mandatory) by any
government or governmental entity of the United States on the extension
of credit by banks or other lending institutions, or (iv) in the case of
any of the foregoing existing at the time of the execution of the Merger
Agreement, a material acceleration or worsening thereof; or
(d) (i) the Board of Directors or any committee thereof shall have
withdrawn, materially modified or changed in a manner adverse to MF
Worldwide or Merger Sub the approval or recommendation of the Offer, the
Merger or the Merger Agreement, or approved or recommended any
Acquisition Transaction or any other acquisition of Company Common Stock
other than the Offer or the Merger, or (ii) the Board of Directors or any
committee thereof shall have resolved to do any of the foregoing; or
(e) the representations and warranties of the Company shall not be true and
correct as of the date of the Merger Agreement or as of the expiration of
the Offer except where failure to be so true and correct would not (in
the aggregate for all representations and warranties of the Company) have
a Material Adverse Effect (as defined below) (other than representations
and warranties that are already so qualified, which in each such case
shall be true and correct as written), and except for (i) changes
specifically contemplated by the Merger Agreement and (ii) those
representations and warranties that address matters only as of a
particular date (which shall remain true and correct as of such date); or
(f) the Company shall have failed to perform any obligation or to comply
with any agreement or covenant of the Company to be performed or complied
with by it under the Merger Agreement unless all such failures together
in their entirety, would not, individually or in the aggregate, have a
Material Adverse Effect; or
(g) the Company shall not have delivered to MF Worldwide binding agreements
signed by the holders of Options representing at least 95% of the Shares
issuable upon exercise of all of the outstanding Options, agreeing to the
cancellation of the Options of such holders on the terms described in
Section 3.1(d) of the Merger Agreement; or
(h) the Company shall not have delivered to MF Worldwide evidence of binding
agreements of the executive officers of the Company to make payment in
full within five business days after the closing of the Offer of all
amounts of principal and accrued interest, whether or not then due and
owing, under all credit, loan or similar agreements as to which the
Company is a lender to or guarantor of such executive officers; or
(i) there shall since March 31, 1999 have occurred any event that,
individually or when considered together with any other matter, has had
or would have a Material Adverse Effect; or
(j) Merger Sub and the Company shall have agreed that Merger Sub shall amend
the Offer to terminate the Offer or postpone the payment for Company
Common Stock pursuant thereto.
As used in the Merger Agreement, "Material Adverse Effect" means any change,
effect, event or occurrence that has, or would have, individually or in the
aggregate, a material adverse impact on the business, assets, liabilities,
results of operations or financial condition of such party and its subsidiaries
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taken as a whole; provided, however, that "Material Adverse Effect" shall be
deemed to exclude (i) changes in general economic conditions or changes
affecting the industries generally in which such party operates, (ii) changes in
trading prices for such party's capital stock, (iii) stockholder litigation
arising from allegations of a breach of fiduciary duty relating to the Merger
Agreement and (iv) the impact of changes in GAAP.
The foregoing conditions are for the sole benefit of Merger Sub and may be
asserted by Merger Sub regardless of the circumstances giving rise to any such
condition or may be waived by Merger Sub in whole or in part at any time and
from time to time in its sole discretion, subject in each case to the terms of
the Merger Agreement. The failure by Merger Sub at any time to execute any of
the foregoing rights shall not be deemed a waiver of any such right with respect
to particular facts and other circumstances shall not be deemed a waiver with
respect to any other facts and circumstances; and each such right shall be
deemed an ongoing right that may be asserted at any time and from time to time.
SECTION 15. CERTAIN LEGAL MATTERS AND REGULATORY APPROVALS.
GENERAL. Based upon its examination of publicly available information with
respect to the Company and its review of certain information furnished by the
Company to Parent and discussions by representatives of Parent with
representatives of the Company during Parent's investigation of the Company,
Parent is not aware of any license or regulatory permit that appears to be
material to the business of the Company and its subsidiaries, taken as a whole,
that might be adversely affected by Merger Sub's acquisition of the Shares
pursuant to the Offer. Except as disclosed herein, Parent is not aware of any
approval or other action by any domestic (federal or state) or foreign
governmental, administrative or regulatory authority or public body that would
be required for the acquisition or ownership of Shares by Merger Sub pursuant to
the Offer. Should any such approval or other action be required, it is Parent's
and Merger Sub's current intention to seek such approval or action. There is,
however, no current intent to delay acceptance for payment of Shares tendered
pursuant to the Offer pending the outcome of any such matter or the receipt of
any such approval (subject to Merger Sub's right to decline to purchase Shares
if any of the conditions in Section 14 shall have occurred). There is no
assurance that any such approval or other action, if needed, would be obtained
without substantial conditions or that adverse consequences might not result to
the business of the Company, Merger Sub or Parent or that certain parts of the
business of the Company, Merger Sub or Parent might not have to be disposed of
or held separate or other substantial conditions complied with in order to
obtain such approval or other action or in the event that such approvals were
not obtained or such other actions were not taken. Merger Sub's obligation under
the Offer to accept the Shares for payment and to pay for such Shares is subject
to certain conditions, including conditions relating to certain legal matters
discussed in this Section 15, which are described in Section 14.
ANTITRUST. Under the HSR Act and the rules that have been promulgated
thereunder by the FTC, certain acquisition transactions contemplated by the
Merger Agreement may not be consummated unless certain information has been
furnished to the Antitrust Division and the FTC and certain waiting period
requirements have been satisfied. The acquisition of Shares pursuant to the
Offer is subject to such requirements. See Section 14.
United intends to file, promptly and in no event after May 19, 1999, a
Premerger Notification and Report Form under the HSR Act with respect to the
purchase of Shares pursuant to the Offer with the Antitrust Division and the
FTC. Under the provisions of the HSR Act applicable to the Offer, the purchase
of Shares pursuant to the Offer may not be consummated until the expiration of a
15-calendar day waiting period following the filing by Parent. Accordingly, it
is anticipated that the waiting period with respect to the Offer under the HSR
Act will expire not later than 11:59 p.m. New York City time, on June 3, 1999,
unless early termination of the waiting period is granted. In addition, the
Antitrust Division or the FTC may extend such waiting periods by requesting
additional information or documentary material from Parent prior to the
expiration of the waiting period. If such a request is made with respect to the
Offer by either the Antitrust Division or the FTC, the waiting period related to
the Offer will expire at
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11:59 p.m. New York City time on the tenth calendar day after substantial
compliance by Parent with such request. Thereafter, the waiting period could be
extended only by court order. With respect to each acquisition, the Antitrust
Division or the FTC may issue only one request for additional information. In
practice, complying with a request for additional information or material can
take a significant amount of time. In addition, if the Antitrust Division or the
FTC raises substantive issues in connection with the proposed transactions
contemplated by the Merger Agreement, the parties may engage in negotiations
with the relevant governmental agency concerning possible means of addressing
those issues and may agree to delay consummation of the transactions
contemplated by the Merger Agreement while such negotiations continue.
Expiration or termination of applicable waiting periods under the HSR Act is a
condition to Merger Sub's obligation to accept for payment and pay for Shares
tendered pursuant to the Offer.
The Antitrust Division and the FTC frequently scrutinize the legality under
the antitrust laws of transactions such as the proposed purchase of the Shares
by Merger Sub pursuant to the Offer. At any time before or after such purchase,
the Antitrust Division or the FTC could take such action under the antitrust
laws as it deems necessary or desirable in the public interest, including
seeking to enjoin the purchase of Shares pursuant to the Offer by Merger Sub or
seeking divestiture of the Shares so acquired or divestiture of substantial
assets of Parent, the Company or their respective subsidiaries. Litigation
seeking similar relief could be brought by private parties.
United also intends to file a notification of the Offer and the Merger with,
and seek the approval of, the Federal Cartel Office (Bunderkartellamt) of
Germany.
Based upon an examination of information available to Parent relating to the
business in which Parent, the Company and their respective subsidiaries are
engaged, Parent and Merger Sub believe that the Offer and the other transactions
contemplated by the Merger Agreement will not violate the antitrust laws and
that such transactions will lead to increased competition. However, there is no
assurance that a challenge to the Offer and the other transactions contemplated
by the Merger Agreement on such grounds will not be made, or if such a challenge
is made, what the result will be. See Section 14 for certain conditions to the
purchase of the Shares, including conditions with respect to litigation and
certain governmental actions.
STATE ANTI-TAKEOVER LAWS. The Company is incorporated under the laws of the
State of Delaware. In general, Section 203 of the DGCL prevents an "interested
stockholder" (generally a person who owns or has the right to acquire 15% or
more of a corporation's outstanding voting stock, or an affiliate or associate
thereof) from engaging in a "business combination" (defined to include mergers
and certain other transactions) with a Delaware corporation for a period of
three years following the time such person became an interested stockholder
unless, among other things, prior to such time the board of directors of the
corporation approved either the business combination or the transaction in which
the interested stockholder became an interested stockholder. On April 28, 1999,
prior to the execution of the Merger Agreement and the Tender and Voting
Agreement, the Board of Directors, by unanimous vote of all directors at a
meeting held on such date, approved the Merger Agreement, the Merger, the Offer
and the other transactions contemplated by the Merger Agreement, including the
Tender and Voting Agreement, and exempted Parent and Merger Sub from the
application of Section 203 in connection therewith. Accordingly, Section 203 is
inapplicable to the Offer and the Merger and the transactions contemplated by
the Merger Agreement.
A number of other states have adopted laws and regulations applicable to
attempts to acquire securities of corporations which are incorporated, or have
substantial assets, stockholders, principal executive offices or principal
places of business, or whose business operations otherwise have substantial
economic effects, in such states. In Edgar v. Mite Corp., the Supreme Court of
the United States invalidated on constitutional grounds the Illinois Business
Takeover Statute, an anti-takeover statute, which, as a matter of state
securities law, made takeovers of corporations meeting certain requirements
27
<PAGE>
more difficult. However, in 1987, in CTS Corp. v. Dynamics Corp. of America, the
Supreme Court held that the State of Indiana may, as a matter of corporate law
and, in particular, with respect to those aspects of corporate law concerning
corporate governance, constitutionally disqualify a potential acquiror from
voting on the affairs of a target corporation without the prior approval of the
remaining stockholders. The state law before the Supreme Court was a shareholder
rights statute that was, by its terms, applicable only to corporations that had
a substantial number of stockholders in the state and were incorporated there.
The Company, directly or through subsidiaries, conducts business in a number
of states throughout the United States, some of which have enacted takeover
laws. Merger Sub does not know whether any of these laws will, by their terms,
apply to the Offer or the Merger and has not complied with any such laws. Should
any person seek to apply any state takeover law, the Merger Sub will take such
action as then appears desirable, which may include challenging the validity or
applicability of any such statute in appropriate court proceedings. In the event
it is asserted that one or more state takeover laws is applicable to the Offer
or the Merger, and an appropriate court does not determine that it is
inapplicable or invalid as applied to the Offer, Merger Sub might be required to
file certain information with, or receive approvals from, the relevant state
authorities. In addition, if enjoined, Merger Sub might be unable to accept for
payment any Shares tendered pursuant to the Offer, or be delayed in continuing
or consummating the Offer and the Merger. In such case, Merger Sub may not be
obligated to accept for payment any Shares tendered. See Section 14.
SECTION 16. FEES AND EXPENSES.
Except as set forth below, neither Parent nor Merger Sub will pay any fees
or commissions to any broker, dealer or other person for soliciting tenders of
Shares pursuant to the Offer.
In connection with this transaction and pursuant to a certain engagement
letter, United retained Allen & Company Incorporated as its Financial Advisor
and the Dealer Manager. In accordance with the terms of the engagement letter,
United has agreed to pay to Allen & Company Incorporated at the consummation of
this transaction, a fee of $4.25 million. In addition, United agreed to
reimburse Allen & Company Incorporated for reasonable travel and other out of
pocket expenses, including reasonable fees and disbursements of its legal
counsel.
Merger Sub has retained D.F. King & Co., Inc. as the Information Agent and
ChaseMellon Shareholder Services, L.L.C. as the Depositary, in connection with
the Offer. The Information Agent and the Dealer Manager may contact holders of
Shares by mail, telephone, telex, telecopy, telegraph and personal interview and
may request banks, brokers, dealers and other nominee stockholders to forward
materials relating to the Offer to beneficial owners.
As compensation for acting as Information Agent in connection with the
Offer, D.F. King & Co., Inc. will receive reasonable and customary compensation
for their services and will also be reimbursed for certain out-of-pocket
expenses and may be indemnified against certain liabilities and expenses in
connection with the Offer, including certain liabilities under the federal
securities laws. Merger Sub will pay the Depositary reasonable and customary
compensation for its services in connection with the Offer, plus reimbursement
for out-of-pocket expenses, and will indemnify the Depositary against certain
liabilities and expenses in connection therewith, including under federal
securities laws. Brokers, dealers, commercial banks and trust companies will be
reimbursed by Merger Sub for customary handling and mailing expenses incurred by
them in forwarding material to their customers.
SECTION 17. MISCELLANEOUS.
Merger Sub is not aware of any state where the making of the Offer is
prohibited by administrative or judicial action pursuant to any valid state
statute. If Merger Sub becomes aware of any valid state statute prohibiting the
making of the Offer or the acceptance of Shares pursuant thereto, Merger Sub
will make a good faith effort to comply with such state statute. If, after such
good faith effort, Merger Sub cannot
28
<PAGE>
comply with such state statute, the Offer will not be made to (nor will tenders
be accepted from or on behalf of) the holders of Shares in such state.
In any jurisdiction where the securities, blue sky or other laws require the
Offer to be made by a licensed broker or dealer, the Offer shall be deemed to be
made on behalf of Merger Sub by one or more registered broker-dealers licensed
under the laws of such jurisdiction.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATION ON BEHALF OF MERGER SUB NOT CONTAINED IN THIS OFFER OR IN THE
LETTER OF TRANSMITTAL AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED.
Pursuant to Rule 14d-3 of the General Rules and Regulations under the
Exchange Act, Parent and Merger Sub have filed with the SEC a Schedule 14D-1 and
13D, together with exhibits, furnishing certain additional information with
respect to the Offer. The Schedule 14D-1 and 13D and any amendments thereto,
including exhibits, may be inspected at, and copies may be obtained from, the
same places and in the same manner as set forth in Section 7 (except that they
will not be available at the regional offices of the SEC).
29
<PAGE>
MFW ACQUISITION CORP.
MAY 6, 1999
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS OF PARENT AND MERGER SUB. The following
table sets forth the name, current business address, citizenship, present
principal occupation or employment, and material occupations and positions,
offices or employments and business addresses thereof for the past five years,
of each director and executive officer of Parent and Merger Sub. None of such
persons has been convicted in a criminal proceeding, nor has any of them been a
party to a proceeding related to U.S. state and federal securities laws.
The directors and executive officers of Parent and Merger Sub are:
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OR EMPLOYMENT POSITION AND
NAME AND BUSINESS ADDRESS CITIZENSHIP FIVE-YEAR EMPLOYMENT HISTORY
- --------------------------------------------- --------------- -------------------------------------------------
<S> <C> <C>
Donald Pazour................................ United States Chief Operating Officer and President, Miller
Miller Freeman Inc. Freeman Inc., since August 1996, Executive
600 Harrison Street Officer, Miller Freeman, Inc., 1977 - August
San Francisco, California 94107 1996.
Anne W. Gurnsey.............................. United States Corporate Counsel and Secretary, United News &
United News & Media Inc. Media Inc., since April 1996. Corporate
32 Union Square East Secretary, MAI North America, Inc., 1990 - April
5th Floor South 1996.
New York, New York 10003
</TABLE>
DIRECTORS AND EXECUTIVE OFFICERS OF UNITED. The following table sets forth
the name, current business address, citizenship, and present principal
occupation or employment, and material occupations and positions, offices or
employments and business addresses thereof for the past five years, of each
member of the Board of Directors and executive officer of United. Unless
otherwise indicated, each such person (i) has held his principal occupation for
the past five years, (ii) has as his current business address Ludgate House, 245
Blackfriars Road, London SE1 9UY England, and (iii) has not been convicted in a
criminal proceeding and has not been party to a proceeding related to U.S. state
and federal securities laws.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OR EMPLOYMENT POSITION AND
NAME AND BUSINESS ADDRESS CITIZENSHIP FIVE-YEAR EMPLOYMENT HISTORY
- --------------------------------------------- --------------- -------------------------------------------------
<S> <C> <C>
Lord Stevens of Ludgate...................... British Chairman since 1981.
Sir James McKinnon........................... British Deputy Chairman and Non-Executive Director since
Huxley House, April 1996. Chairman, MAI plc, 1992 - April 1996.
28 Copsem Lane,
Esher, Surrey KT10 9HE
Clive Hollick................................ British Group Chief Executive since April 1996. Group
Managing Director, MAI plc, 1974 - February 1997.
Charles Stern................................ British Finance Director since 1992.
Charles Gregson.............................. British Executive Director since April 1996. Director,
MAI plc, since 1984.
</TABLE>
30
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OR EMPLOYMENT POSITION AND
NAME AND BUSINESS ADDRESS CITIZENSHIP FIVE-YEAR EMPLOYMENT HISTORY
- --------------------------------------------- --------------- -------------------------------------------------
<S> <C> <C>
Nigel Donaldson.............................. British Executive Director since 1991.
Roger Laughton............................... British Non-Executive Director since April 1999.
Executive Director, April 1996 - April 1999.
Chief Executive Officer, MAI Broadcasting, 1990 -
April 1996.
Tony Tillin.................................. British Executive Director since March 1998 and Chief
Blenheim House, Executive of Miller Freeman subsidiary since
630 Chiswick High Road, August 1997. Senior executive, EMAP Group, May
London W4 5BG 1996 -August 1997. Senior executive, Reed
International, 1989 - December 1994.
Christopher Powell........................... British Non-Executive Director since April 1996. Chief
12 Bishops Bridge Road Executive, BMP DDB, since 1984.
London W2 6AA
Geoffrey Unwin............................... British Non-Executive Director since April 1996. Vice
Cap Gemini House, Chairman of the Executive Board, Cap Gemini
130 Shaftsbury Avenue Group, since 1996.
London W1V 8HH
John Botts................................... United States Non-Executive Director since July 1997. Chairman,
Lintas House, Botts & Company Limited, since August 1988.
15-19 New Fetter Lane
London EC4A 1BA
Fields Wicker-Miurin......................... United States Non-Executive Director since March 1998. Director
Lansdowne House of finance and strategy, London Stock Exchange,
Berkeley Square September 1994 - December 1997. Partner, Mercer
London W1X 5DH Management Consulting, 1989 - September 1994.
Partner, A.T. Kearney, since August 1998.
Anne Claire Siddell.......................... British Company Secretary since June 1997. Company
Secretary and Group Legal Director House of
Fraser plc, December 1993 - May 1997.
</TABLE>
31
<PAGE>
LETTER OF TRANSMITTAL
TO TENDER CLASS A AND CLASS B SHARES OF COMMON STOCK
OF
CMP MEDIA INC.
AT $39.00 PER SHARE, NET
PURSUANT TO THE OFFER TO PURCHASE DATED MAY 6, 1999
BY
MFW ACQUISITION CORP.,
A WHOLLY-OWNED SUBSIDIARY
OF
MFW ACQUISITION HOLDINGS CORP.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON THURSDAY, JUNE 3, 1999 UNLESS THE OFFER IS EXTENDED.
THE DEPOSITARY FOR THE OFFER IS:
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
<TABLE>
<S> <C>
BY REGISTERED OR CERTIFIED MAIL: BY HAND BEFORE 4:30 P.M.:
ChaseMellon Shareholder Services, ChaseMellon Shareholder Services,
L.L.C. L.L.C.
PO Box 3301 120 Broadway, 13th Floor
South Hackensack, NJ 07606 New York, NY 10271
Attention: Reorganization Department Attention: Reorganization Department
BY OVERNIGHT COURIER AND BY FACSIMILE TRANSMISSION:
BY HAND AFTER 4:30 P.M. (201) 296-4293
ON EXPIRATION DATE ONLY: CONFIRM BY TELEPHONE TO:
(201) 296-4860
ChaseMellon Shareholder Services,
L.L.C.
85 Challenger Road, Mail Drop-Reorg
Ridgefield Park, NJ 07660
Attention: Reorganization Department
</TABLE>
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS LETTER OF
TRANSMITTAL IN THE APPROPRIATE SPACE PROVIDED THEREFOR, WITH SIGNATURE GUARANTEE
IF REQUIRED, AND COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW. SEE
INSTRUCTION 1.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
This Letter of Transmittal is to be completed by stockholders either if
certificates (the "Share Certificates") evidencing Shares (as defined below) are
to be forwarded herewith or, unless an Agent's Message (as defined in the Offer
to Purchase) is utilized, if delivery of Shares is to be made by book-entry
transfer to the account maintained by the Depositary at The Depository Trust
Company (the "Book-Entry Transfer Facility") pursuant to the book-entry transfer
procedures described in Section 3 of the Offer to Purchase (as defined below).
Stockholders whose Share Certificates are not immediately available or who
cannot deliver their Share Certificates and all other documents required hereby
to the Depositary prior to the Expiration Date (as defined in Section 1 of the
Offer to Purchase) or who cannot complete the procedures for delivery by
book-entry transfer on a timely basis and who wish to tender their Shares must
do so pursuant to the guaranteed delivery procedures set forth in Section 3 of
the Offer to Purchase. See Instruction 2. DELIVERY OF DOCUMENTS TO THE
BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
<PAGE>
/ / CHECK HERE IF SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER TO THE
DEPOSITARY'S ACCOUNT AT THE BOOK-ENTRY TRANSFER FACILITY AND COMPLETE THE
FOLLOWING:
Name of Tendering Institution: _________________________________________________
Account Number: ________________________________________________________________
Transaction Code Number: _______________________________________________________
/ / CHECK HERE IF SHARES ARE BEING TENDERED PURSUANT TO A NOTICE OF GUARANTEED
DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING:
Name(s) of Registered Holder(s): _______________________________________________
Window Ticket No. (if any): ____________________________________________________
Date of Execution of Notice of Guaranteed Delivery: ____________________________
Name of Institution which Guaranteed Delivery: _________________________________
DESCRIPTION OF SHARES TENDERED
<TABLE>
<S> <C> <C> <C> <C>
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S),
(PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S)
APPEAR(S) ON SHARE CERTIFICATE(S) (ATTACH ADDITIONAL LIST IF NECESSARY)
TOTAL NUMBER OF
SHARES
REPRESENTED BY NUMBER OF
SHARE CLASS SHARE SHARES
CERTIFICATE (A OR B) CERTIFICATES* TENDERED**
</TABLE>
* Need not be completed by stockholders delivering Shares by book-entry
transfer.
** Unless otherwise indicated, it will be assumed that all Shares evidenced by
each Share Certificate delivered to the Depositary are being tendered
hereby. See Instruction 4.
NOTE: SIGNATURES MUST BE PROVIDED BELOW. PLEASE READ THE INSTRUCTIONS SET FORTH
IN THIS LETTER OF TRANSMITTAL CAREFULLY.
2
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to MFW Acquisition Corp., a Delaware
corporation (the "Merger Sub") and wholly-owned subsidiary of MFW Acquisition
Holdings Corp., a Delaware corporation ("Parent"), the above-described shares of
Class A Common Stock, par value $.01 per share, and Class B Common Stock, par
value $.01 per share (collectively, the "Shares"), of CMP Media Inc., a Delaware
corporation (the "Company"), pursuant to Merger Sub's offer to purchase all
Shares, at a price of $39.00 per Share, net to seller in cash, upon the terms
and subject to the conditions set forth in the Offer to Purchase, dated May 6,
1999 (the "Offer to Purchase"), receipt of which is hereby acknowledged, and in
this Letter of Transmittal (which, together with the Offer to Purchase,
constitute the "Offer"). The undersigned understands that Merger Sub reserves
the right to transfer or assign, in whole or from time to time in part, to one
or more affiliates of Parent, the right to purchase all or any portion of the
Shares tendered pursuant to the Offer.
Subject to, and effective upon, acceptance for payment of the Shares
tendered herewith, in accordance with the terms of the Offer, the undersigned
hereby sells, assigns and transfers to, or upon the order of, Merger Sub all
right, title and interest in and to all the Shares that are being tendered
hereby and all dividends, distributions (including, without limitation,
distributions of additional Shares) and rights declared, paid or distributed in
respect of such Shares on or after April 28, 1999 (collectively,
"Distributions") and irrevocably constitutes and appoints the Depositary the
true and lawful agent and attorney-in-fact of the undersigned with respect to
such Shares and all Distributions, with full power of substitution (such power
of attorney being deemed to be an irrevocable power coupled with an interest),
to (i) deliver Share Certificates for such Shares and all Distributions, or
transfer ownership of such Shares and all Distributions on the account books
maintained by the Book-Entry Transfer Facility, together, in either case, with
all accompanying evidences of transfer and authenticity, to or upon the order of
Merger Sub, (ii) present such Shares and all Distributions for transfer on the
books of the Company and (iii) receive all benefits and otherwise exercise all
rights of beneficial ownership of such Shares and all Distributions, all in
accordance with the terms of the Offer.
The undersigned hereby irrevocably appoints Donald Pazour and Anne Gurnsey,
and each of them, as such stockholder's attorneys and proxies, each with full
power of substitution, to vote in such manner as each such attorney or proxy or
his substitute shall, in his sole discretion, deem proper, and otherwise act (by
written consent or otherwise) with respect to all the Shares tendered hereby
which have been accepted for payment by Merger Sub prior to the time of such
vote or other action (and any and all other Shares or securities issued or
issuable in respect thereof on or after April 28, 1999). This proxy and power of
attorney is coupled with an interest in the Shares tendered hereby, is
irrevocable and is granted in consideration of, and is effective upon, the
acceptance for payment by Merger Sub of such Shares in accordance with the terms
of the Offer. Upon such acceptance for payment, all prior proxies and powers of
attorney granted by such stockholder will, without further action, be revoked,
and no subsequent proxy or power of attorney may be given nor any subsequent
written consent executed by such stockholder (and if given or executed, shall
not be effective). The designees of Merger Sub will be empowered, with respect
to such Shares for which the appointment is effective, to exercise all voting
and other rights (whether by written consent or otherwise) of such stockholder
as they, in their sole discretion, may deem proper at any annual or special
meeting of the Company's stockholders or any adjournment of postponement
thereof, by written consent in lieu of any such meeting or otherwise. The
undersigned understands that, in order for Shares to be deemed validly tendered,
immediately upon Merger Sub's acceptance of such Shares, Merger Sub must be able
to exercise full voting rights with respect to such Shares.
3
<PAGE>
The undersigned hereby represents and warrants that the undersigned has full
power and authority to tender, sell, assign and transfer the Shares tendered
hereby and all Distributions, that when such Shares are accepted for payment by
Merger Sub, Merger Sub will acquire good, marketable and unencumbered title
thereto and to all Distributions, free and clear of all liens, restrictions,
charges and encumbrances, and that none of such Shares and Distributions will be
subject to any adverse claim. The undersigned, upon request, shall execute and
deliver any additional documents deemed by the Depositary or Merger Sub to be
necessary or desirable to complete the sale, assignment and transfer of the
Shares tendered hereby and all Distributions. In addition, the undersigned shall
remit and transfer promptly to the Depositary for the account of Merger Sub all
Distributions in respect of the Shares tendered hereby, accompanied by
appropriate documentation of transfer, and pending such remittance and transfer
or appropriate assurance thereof, Merger Sub shall be entitled to all rights and
privileges as owner of each such Distribution and may withhold the entire
purchase price of the Shares tendered hereby, or deduct from such purchase
price, the amount or value of such Distribution as determined by Merger Sub in
its sole discretion.
All authority herein conferred or agreed to be conferred in this Letter of
Transmittal shall not be affected by, and all such authority shall survive, the
death or incapacity of the undersigned. Any obligations of the undersigned
hereunder shall be binding upon the heirs, executors, administrators and legal
and personal representatives, successors and assigns of the undersigned. Except
as stated in the Offer to Purchase, this tender is irrevocable.
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described in Section 3 of the Offer to Purchase and in the
instructions hereto will constitute the acceptance of the undersigned of the
terms and conditions of the Offer. Merger Sub's acceptance of such Shares for
payment will constitute a binding agreement between the undersigned and Merger
Sub upon the terms and subject to the conditions of the Offer.
Unless otherwise indicated herein in the box entitled "Special Payment
Instructions," please issue the check for the purchase price of all Shares
purchased, and return all Share Certificates evidencing Shares not purchased or
not tendered in the name(s) of the registered holder(s) appearing above under
"Description of Shares Tendered." Similarly, unless otherwise indicated in the
box entitled "Special Delivery Instructions," please mail the check for the
purchase price of all Shares purchased and all Share Certificates evidencing
Shares not tendered or not purchased (and accompanying documents, as
appropriate) to the undersigned at the address shown above under "Description of
Shares Tendered." In the event that both the Special Payment Instructions and
the Special Delivery Instructions are completed, please issue the check for the
purchase price of all Shares purchased and return all Share Certificates
evidencing Shares not tendered or accepted for payment in the name(s) of, and
mail such check and Share Certificates to, the person(s) so indicated. Unless
otherwise indicated herein in the box entitled "Special Payment Instructions,"
please credit any Shares tendered hereby and delivered by book-entry transfer,
but which are not purchased, by crediting the account at the Book-Entry Transfer
Facility designated above. The undersigned recognizes that Merger Sub has no
obligation, pursuant to the Special Payment Instructions, to transfer any Shares
from the name(s) of the registered holder(s) thereof if Merger Sub does not
purchase any of the Shares tendered hereby.
4
<PAGE>
<TABLE>
<S> <C>
SPECIAL PAYMENT INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 5, 6 AND 7) (SEE INSTRUCTIONS 1, 4, 5, 6 AND 7)
To be completed ONLY if Share Certificates for To be completed ONLY if Share Certificates for
Shares not tendered or not purchased and/or the Shares not tendered or not purchased and/or the
check for the purchase price of Shares purchased check for the purchase price of shares purchased
are to be issued in the name of someone other are to be sent to someone other than the
than the undersigned, or if Shares tendered undersigned, or to the undersigned at an address
hereby and delivered by book-entry transfer which other than that shown above.
are not purchased are to be returned by credit to
an account maintained at the Book-Entry Transfer
Facility other than that designated above.
Issue check and/or certificate to: Issue check and/or certificate to:
Name Name
(PLEASE PRINT) (PLEASE PRINT)
Address Address
(INCLUDE ZIP CODE) (INCLUDE ZIP CODE)
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER) (TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER)
/ / Credit unpurchased Shares delivered by
book-entry transfer to the Book-Entry
Transfer Facility account set forth below.
(ACCOUNT NUMBER)
</TABLE>
5
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. No signature guarantee on this Letter of
Transmittal is required if (a) this Letter of Transmittal is signed by the
registered holder of the Shares (which term, for purposes of this document,
includes any participant in the Book-Entry Transfer Facility whose name appears
on a security position listing as the owner of the Shares) tendered herewith
unless such holder has completed either the box entitled "Special Delivery
Instructions" or the box entitled "Special Payment Instructions" on the reverse
hereof or (b) such Shares are tendered for the account of a bank, broker,
dealer, credit union, savings association or other entity that is a member in
good standing of the Securities Transfer Agents Medallion Program, the New York
Stock Exchange Medallion Signature Guarantee Program or the Stock Exchange
Medallion Program (each an "Eligible Institution"). In all other cases, all
signatures on this Letter of Transmittal must be guaranteed by an Eligible
Institution.
2. DELIVERY OF LETTER OF TRANSMITTAL AND SHARE CERTIFICATES. This Letter of
Transmittal is to be completed by stockholders either if Share Certificates are
to be forwarded herewith or if tenders of Shares are to be made pursuant to the
procedures for delivery by book-entry transfer set forth in Section 3 of the
Offer to Purchase. Share Certificates evidencing all physically tendered Shares,
or any Book Entry Confirmation of Shares, as the case may be, as well as a
properly completed and duly executed Letter of Transmittal (or facsimile
thereof), with any required signature guarantees, or an Agent's Message (as
defined in the Offer to Purchase) in connection with a book-entry transfer
facility, and any other documents required by this Letter of Transmittal, must,
in any case, be received by the Depositary at its addresses set forth herein on
or prior to the Expiration Date (as defined in Section 1 of the Offer to
Purchase). If Share Certificates are forwarded to the Depositary in multiple
deliveries, a properly completed and duly executed Letter of Transmittal must
accompany each such delivery.
Stockholders whose Share Certificates are not immediately available or who
cannot deliver their Share Certificates and all other required documents to the
Depositary on or prior to the Expiration Date or who cannot complete the
procedures for delivery by book-entry transfer on a timely basis may tender
their Shares by properly completing and duly executing the Notice of Guaranteed
Delivery pursuant to the guaranteed delivery procedures set forth in Section 3
of the Offer to Purchase. Pursuant to such procedures: (a) such tender must be
made by or through an Eligible Institution; (b) a properly completed and duly
executed Notice of Guaranteed Delivery, substantially in the form made available
by Merger Sub, must be received by the Depositary prior to the Expiration Date;
and (c) the Share Certificates evidencing all physically delivered Shares in
proper form for transfer by delivery, or Book Entry Confirmation of Shares, in
each case together with properly completed and duly executed Letter of
Transmittal (or a facsimile thereof), unless an Agent's Message is utilized,
properly completed and duly executed, with any required signature guarantees,
and any other documents required by this Letter of Transmittal, must be received
by the Depositary within three Nasdaq National Market System ("Nasdaq") trading
days after the date of execution of such Notice of Guaranteed Delivery, all as
provided in Section 3 of the Offer to Purchase.
THE METHOD OF DELIVERY OF THIS LETTER OF TRANSMITTAL, THE SHARE CERTIFICATE
AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH THE BOOK-ENTRY
TRANSFER FACILITY, IS AT THE OPTION AND SOLE RISK OF THE TENDERING STOCKHOLDER
AND THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE
DEPOSITARY. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME
SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
No alternative, conditional or contingent tenders will be accepted and no
fractional Shares will be purchased. All tendering stockholders, by execution of
this Letter of Transmittal (or a facsimile hereof), waive any right to receive
any notice of the acceptance of their Shares for payment.
6
<PAGE>
3. INADEQUATE SPACE. If the space provided herein under "Description of
Shares Tendered" is inadequate, the Share Certificate numbers and/or the number
of Shares should be listed on a separate schedule attached hereto.
4. PARTIAL TENDER. (Not applicable to stockholders who tender by book-entry
transfer). If fewer than all the Shares evidenced by any Share Certificate
submitted are to be tendered, fill in the number of Shares which are to be
tendered in the box entitled "Number of Shares Tendered." In such cases, new
Share Certificate(s) evidencing the remainder of the Shares that were evidenced
by your old Share Certificates will be sent to you as soon as practicable after
the Expiration Date. All Shares represented by Share Certificates delivered to
the Depositary will be deemed to have been tendered unless otherwise indicated.
5. SIGNATURES ON LETTER OF TRANSMITTAL, STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the Shares
tendered hereby, the signature(s) must correspond exactly with the name(s) as
written on the face of the Share Certificates without alteration, enlargement or
any change whatsoever.
If any of the Shares tendered hereby are owned of record by two or more
joint owners, all such owners must sign this Letter of Transmittal.
If any tendered Shares are registered in different names, it will be
necessary to complete, sign and submit as many separate Letters of Transmittal
as there are different registrations of Share Certificates.
If this Letter of Transmittal or any Share Certificates or stock powers are
signed by a trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or other person acting in a fiduciary or representative
capacity, such person should so indicate when signing, and proper evidence
satisfactory to Merger Sub of such person's authority to so act must be
submitted.
When this Letter of Transmittal is signed by the registered holder(s) of the
Shares listed and transmitted hereby, no endorsements of Share Certificates or
separate stock powers are required unless payment or Share Certificates for
Shares not tendered or purchased are to be issued to a person other than the
registered owner(s). Signatures on such Share Certificates or stock powers must
be guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares listed, the Share Certificate(s) must be
endorsed in blank or accompanied by appropriate stock powers, in either case
signed exactly as the name(s) of the registered holder(s) appear(s) on such
Share Certificate(s). Signatures on such Share Certificate(s) or stock powers
must be guaranteed by an Eligible Institution.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, Merger
Sub will pay or cause to be paid any stock transfer taxes with respect to the
sale and transfer of purchased Shares to it or its order pursuant to the Offer.
If, however, payment of the purchase price is to be made to, or if Share
Certificate(s) for Shares not tendered or purchased are to be registered in the
name of, any person other than the registered holder(s), or if tendered Share
Certificates are registered in the name of any person other than the person(s)
signing this Letter of Transmittal, the amount of any stock transfer taxes
(whether imposed on the registered holder(s), such other person or otherwise)
payable on account of the transfer to such person will be deducted from the
purchase price unless satisfactory evidence of the payment of such taxes or
exemption therefrom is submitted.
EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY FOR
TRANSFER TAX STAMPS TO BE AFFIXED TO THE SHARE CERTIFICATES EVIDENCING THE
SHARES TENDERED HEREBY.
7
<PAGE>
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If a check for the purchase
price of any Shares tendered hereby is to be issued, or Share Certificate(s) for
unpurchased Shares are to be issued, in the name of a person other than the
person(s) signing this Letter of Transmittal or if a check is to be sent or such
Share Certificates are to be returned to someone other than the person(s)
signing this Letter of Transmittal or to the person(s) signing this Letter of
Transmittal but at an address other than that shown above, the appropriate boxes
on this Letter of Transmittal should be completed. Stockholders tendering Shares
by book-entry transfer may request that Shares not purchased be credited to such
account maintained at the Book-Entry Transfer Facility as such stockholder may
designate hereon. If no such instructions are given, such Shares not purchased
will be returned by crediting the account at the Book-Entry Transfer Facility as
the account from which such Shares were delivered.
8. QUESTIONS AND REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions and
requests for assistance may be directed to the Information Agent or the Dealer
Manager at their respective addresses or telephone numbers set forth below.
Additional copies of the Offer to Purchase, this Letter of Transmittal and the
Notice of Guaranteed Delivery may be obtained from the Information Agent or from
brokers, dealers, commercial banks or trust companies.
9. SUBSTITUTE FORM W-9. The tendering stockholder is required to provide the
Depositary with a correct Taxpayer Identification Number ("TIN") on the
Substitute Form W-9 which is provided under "Important Tax Information" below,
and to certify, under penalties of perjury, that such number is correct and that
such stockholder is not subject to backup withholding of federal income tax. If
a tendering stockholder has been notified by the Internal Revenue Service that
such stockholder is subject to backup withholding, such stockholder must cross
out item (2) of the Certification box of the Substitute Form W-9, unless such
stockholder has since been notified by the Internal Revenue Service that such
stockholder is no longer subject to backup withholding. Failure to provide the
information on the Substitute Form W-9 may subject the tendering stockholder to
31% federal income tax withholding on the payment of the purchase price. If the
tendering stockholder has not been issued a TIN and has applied for a number or
intends to apply for a number in the near future, such stockholder should write
"Applied For" in the space provided for the TIN in Part I of the Substitute Form
W-9, and sign and date the Substitute Form W-9. If "Applied For" is written in
Part I and the Depositary is not provided with a TIN within 60 days, the
Depositary will withhold 31% on all payments of the purchase price to such
stockholder until a TIN is provided to the Depositary.
10. LOST, DESTROYED OR STOLEN SHARE CERTIFICATES. If any Share
Certificate(s) representing Shares has been lost, destroyed or stolen, the
stockholder should promptly notify the Information Agent. The stockholder will
then be instructed as to the steps that must be taken in order to replace the
Share Certificate(s). This Letter of Transmittal and related documents cannot be
processed until the procedures for replacing lost or destroyed Share
Certificates have been followed.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR FACSIMILE THEREOF), PROPERLY
COMPLETED AND DULY EXECUTED (TOGETHER WITH ANY REQUIRED SIGNATURE GUARANTEES AND
SHARE CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER AND ALL OTHER REQUIRED
DOCUMENTS) OR A PROPERLY COMPLETED AND DULY EXECUTED NOTICE OF GUARANTEED
DELIVERY, MUST BE RECEIVED BY THE DEPOSITARY ON OR PRIOR TO THE EXPIRATION DATE.
8
<PAGE>
IMPORTANT TAX INFORMATION
Under the federal income tax law, a stockholder whose tendered Shares are
accepted for payment is required by law to provide the Depositary (as payer)
with such stockholder's correct TIN on Substitute Form W-9 below. If such
stockholder is an individual, the TIN is such stockholder's social security
number. If a tendering stockholder is subject to backup withholding, he or she
must cross out Item (2) of the Certification box on the Substitute Form W-9. If
the Depositary is not provided with the correct TIN, the stockholder may be
subject to a $50 penalty imposed by the Internal Revenue Service. In addition,
payments that are made to such stockholder with respect to Shares purchased
pursuant to the Offer may be subject to backup withholding. If a stockholder
makes a false statement that results in no imposition of backup withholding, and
there was no reasonable basis for such statement, a $500 penalty may also be
imposed by the Internal Revenue Service.
Certain stockholders (including, among others, all corporations and certain
foreign individuals) are not subject to these backup withholding and reporting
requirements. In order for a foreign individual to qualify as an exempt
recipient, that stockholder must submit a statement, signed under penalties of
perjury, attesting to that individual's exempt status. Such statements may be
obtained from the Depositary. Exempt stockholders, other than foreign
individuals, should furnish their TIN, write "Exempt" on the face of the
Substitute Form W-9 below and sign, date and return the Substitute Form W-9 to
the Depositary. See the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional instructions. A
stockholder should consult his or her tax advisor as to such stockholder's
qualification for exemption from backup withholding and the procedure for
obtaining such exemption.
If backup withholding applies, the Depositary is required to withhold 31% of
any payments made to the stockholder. Backup withholding is not an additional
tax. Rather, the tax liability of persons subject to backup withholding will be
reduced by the amount of tax withheld. If withholding results in an overpayment
of taxes, a refund may be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent federal income tax backup withholding on payments of cash that
are made to a stockholder with respect to Shares purchased pursuant to the
Offer, the stockholder must provide the Depositary with such stockholder's
correct TIN by completing the form below certifying under penalties of perjury
(a) that the TIN provided on Substitute Form W-9 is correct (or that such
stockholder is awaiting a TIN) and (b) that (i) such stockholder has not been
notified by the Internal Revenue Service that such stockholder is subject to
backup withholding as a result of a failure to report all interest or dividends
or (ii) the Internal Revenue Service has notified such stockholder that such
stockholder is no longer subject to backup withholding.
WHAT NUMBER TO GIVE THE DEPOSITARY
The stockholder is required to give the Depositary the social security
number or employer identification number of the record holder of the Shares
tendered hereby. If the Shares are in more than one name or are not in the name
of the actual owner, consult the enclosed Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9 for additional guidance on
which number to report. If the tendering stockholder has not been issued a TIN
and has applied for a number or intends to apply for a number in the near
future, the stockholder should write "Applied For" in the space provided for the
TIN in Part I, and sign and date the Substitute Form W-9. If "Applied For" is
written in Part I and the Depositary is not provided with a TIN within 60 days,
the Depositary will withhold 31% of all payments of the purchase price until a
TIN is provided to the Depositary.
9
<PAGE>
PAYER'S NAME: CHASE MELLON SHAREHOLDER SERVICES, L.L.C.
<TABLE>
<S> <C> <C>
SUBSTITUTE PART I--PLEASE PROVIDE YOUR TIN SOCIAL SECURITY NUMBER
FORM W-9 IN THE BOX AT RIGHT AND CERTIFY OR EMPLOYER IDENTIFICATION
BY SIGNING AND DATING BELOW. NUMBER
Department of the Treasury
Internal Revenue Service
Payer's Request for Taxpayer PART II--For Payees exempt from backup withholding, see the enclosed
Identification Number (TIN) Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9 and complete as instructed therein.
(If awaiting TIN write "Applied For")
CERTIFICATION--Under the penalties of perjury, I certify that:
(1) The number shown on this form is my correct Taxpayer Identification Number (or a Taxpayer
Identification Number has not been issued to me) and either (a) I have mailed or delivered an
application to receive a Taxpayer Identification Number to the appropriate Internal Revenue
Service ("IRS") or Social Security Administration office or (b) I intend to mail or deliver an
application in the near future. (I understand that if I do not provide a Taxpayer Identification
Number within 60 days, 31% of all reportable payments made to me thereafter will be withheld
until I provide a number); and
(2) I am not subject to backup withholding either because I have not been notified by the IRS that I
am subject to backup withholding as a result of a failure to report all interest or dividends, or
the IRS has notified me that I am no longer subject to backup withholding.
CERTIFICATION INSTRUCTIONS--You must cross out item (2) above if you have been notified by the IRS
that you are subject to backup withholding because of underreporting interest or dividends on your
tax return. However, if after being notified by the IRS that you were subject to backup withholding
you received another notification from the IRS that you are no longer subject to backup withholding,
do not cross out item (2). (Also see instructions in the enclosed Guidelines).
SIGNATURE DATE ,1999
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THIS OFFER. PLEASE REVIEW
THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
10
<PAGE>
Facsimiles of the Letter of Transmittal, properly completed and duly signed,
will be accepted. The Letter of Transmittal, Share Certificates and any other
required documents should be sent or delivered by each stockholder to such
stockholder's broker, dealer, commercial bank, trust company or other nominee to
the Depositary at one of its addresses set forth below.
THE DEPOSITARY FOR THE OFFER IS:
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
<TABLE>
<S> <C>
BY REGISTERED OR CERTIFIED MAIL: BY HAND BEFORE 4:30 P.M.:
ChaseMellon Shareholder Services, ChaseMellon Shareholder Services,
L.L.C. L.L.C.
PO Box 3301 120 Broadway, 13th Floor
South Hackensack, NJ 07606 New York, NY 10271
Attention: Reorganization Department Attention: Reorganization Department
BY OVERNIGHT COURIER AND BY FACSIMILE TRANSMISSION:
BY HAND AFTER 4:30 P.M. (201) 296-4293
ON EXPIRATION DATE ONLY: CONFIRM BY TELEPHONE TO:
ChaseMellon Shareholder Services, (201) 296-4860
L.L.C.
85 Challenger Road, Mail Drop-Reorg
Ridgefield Park, NJ 07660
Attention: Reorganization Department
</TABLE>
Questions or request for assistance may be directed to the Information Agent
at its address and telephone number listed below. Additional copies of the Offer
to Purchase, this Letter of Transmittal and the Notice of Guaranteed Delivery
may be obtained from the Information Agent. A stockholder may also contact
brokers, dealers, commercial banks or trust companies for assistance concerning
the Offer.
The Information Agent for the Offer is:
D.F. KING & CO., INC.
77 Water Street
New York, NY 10005-4495
Telephone: (800) 431-9629
The Dealer Manager for the Offer is:
ALLEN & COMPANY INCORPORATED
711 Fifth Avenue
New York, New York 10022
Telephone: (212) 832-8000
11
<PAGE>
NOTICE OF GUARANTEED DELIVERY
FOR
TENDER OF CLASS A AND CLASS B SHARES OF COMMON STOCK
OF
CMP MEDIA INC.
TO
MFW ACQUISITION CORP.
A WHOLLY-OWNED SUBSIDIARY
OF
MFW ACQUISTION HOLDINGS CORP.
(NOT TO BE USED FOR SIGNATURE GUARANTEES)
This Notice of Guaranteed Delivery, or one substantially in the form hereof,
must be used to accept the Offer (as defined below) (i) if certificates ("Share
Certificates") evidencing shares of Class A and Class B Common Stock, par value
$.01 per share (the "Shares"), of CMP Media Inc., a Delaware corporation (the
"Company"), are not immediately available, (ii) if Share Certificates and all
other required documents cannot be delivered to ChaseMellon Shareholder
Services, L.L.C., as Depositary (the "Depositary"), prior to the Expiration Date
(as defined in Section 1 of the Offer to Purchase (as defined below)) or (iii)
if the procedures for book-entry transfer cannot be completed on a timely basis.
This Notice of Guaranteed Delivery may be delivered by hand or mail or
transmitted by telegram, telex or facsimile transmission to the Depositary. See
Section 3 of the Offer to Purchase.
THE DEPOSITARY FOR THE OFFER IS:
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
<TABLE>
<S> <C>
BY REGISTERED OR CERTIFIED MAIL: BY HAND BEFORE 4:30 P.M.:
ChaseMellon Shareholder Services, L.L.C. ChaseMellon Shareholder Services, L.L.C.
PO Box 3301 120 Broadway, 13th Floor
South Hackensack, NJ 07606 New York, NY 10271
Attention: Reorganization Department Attention: Reorganization Department
BY OVERNIGHT COURIER AND BY FACSIMILE TRANSMISSION:
BY HAND AFTER 4:30 P.M. (201) 296-4293
ON EXPIRATION DATE ONLY: CONFIRM BY TELEPHONE TO:
ChaseMellon Shareholder Services, L.L.C. (201) 296-4860
85 Challenger Road, Mail Drop-Reorg
Ridgefield Park, NJ 07660
Attention: Reorganization Department
</TABLE>
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE, OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION OR
TELEX OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
<PAGE>
This form is not to be used to guarantee signatures. If a signature on a
Letter of Transmittal is required to be guaranteed by an "Eligible Institution"
under the instructions thereto, such signature guarantee must appear in the
applicable space provided in the signature box on the Letter of Transmittal.
Ladies and Gentlemen:
The undersigned hereby tender(s) to MFW Acquisition Corp., a Delaware
corporation and a wholly-owned subsidiary of MFW Acquisition Holdings Corp., a
Delaware corporation, upon the terms and subject to the conditions set forth in
the Offer to Purchase, dated May 6, 1999 (the "Offer to Purchase"), and the
related Letter of Transmittal (which constitute the "Offer"), receipt of each of
which is hereby acknowledged, the number of Shares specified below pursuant to
the guaranteed delivery procedures described in Section 3 of the Offer to
Purchase.
<TABLE>
<S> <C>
Number and Class of Shares: Name(s) of Record Holder(s)
Share Certificate No(s). (if available)
Please Type or Print
(Check box if Shares will be tendered by
book-entry transfer)
/ / The Depository Trust Company
Account Number Address(es)
Dated , 1999
Zip Code
Area Code and Tel. No.
Signature(s)
</TABLE>
2
<PAGE>
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a bank, broker, dealer, credit union, savings association
or other entity that is a member in good standing of the Securities Transfer
Agents Medallion Program, the New York Stock Exchange Medallion Signature
Guarantee Program or the Stock Exchange Medallion Program, guarantees delivery
to the Depositary, at one of its addresses set forth above, of Share
Certificates representing the Shares tendered hereby in proper form for
transfer, or confirmation of book-entry transfer of such Shares into the
Depositary's account at the Book-Entry Transfer Facility (as defined in the
Offer to Purchase) with delivery of a properly completed and duly executed
Letter of Transmittal (or facsimile thereof) with any required signature
guarantees or an Agent's Message (as defined in the Offer to Purchase) in the
case of a book-entry delivery, and any other required documents, within three
Nasdaq National Market System trading days after the date hereof.
<TABLE>
<CAPTION>
<S> <C>
Name of Firm Authorized Signature
Address Title
Name
Zip Code Please Type or Print
Area Code and Tel. No. Date , 1999
</TABLE>
NOTE: DO NOT SEND SHARE CERTIFICATES WITH THIS NOTICE. SHARE CERTIFICATES
SHOULD BE SENT WITH YOUR LETTER OF TRANSMITTAL.
3
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING CLASS A AND CLASS B SHARES OF COMMON STOCK
OF
CMP MEDIA INC.
AT
$39.00 PER SHARE, NET
BY
MFW ACQUISITION CORP.,
A WHOLLY-OWNED SUBSIDIARY
OF
MFW ACQUISITION HOLDINGS CORP., INC.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON THURSDAY, JUNE 3, 1999, UNLESS THE OFFER IS EXTENDED. May 6, 1999
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
MFW Acquisition Corp., a Delaware corporation ("Purchaser") and a
wholly-owned subsidiary of MFW Acquisition Holdings Corp., Inc., a Delaware
corporation, is offering to purchase all outstanding shares of Class A and Class
B Common Stock, par value $.01 per share (collectively, the "Shares"), of CMP
Media Inc., a Delaware corporation (the "Company"), at a price of $39.00 per
Share, net to the seller in cash, upon the terms and subject to the conditions
set forth in Purchaser's Offer to Purchase, dated May 6, 1999 (the "Offer to
Purchase"), and the related Letter of Transmittal (which together constitute the
"Offer") enclosed herewith. Please furnish copies of the enclosed materials to
those of your clients for whose accounts you hold Shares registered in your name
or in the name of your nominee.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (I) THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER SHARES
REPRESENTING AT LEAST 51% OF THE VOTING POWER OF ALL OUTSTANDING SHARES ON A
FULLY DILUTED BASIS AND (II) THE EXPIRATION OR TERMINATION OF ANY APPLICABLE
WAITING PERIOD UNDER THE HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT OF 1976,
AS AMENDED. THE OFFER IS ALSO SUBJECT TO OTHER TERMS AND CONDITIONS WHICH ARE
CONTAINED IN THE OFFER TO PURCHASE.
<PAGE>
For your information and for forwarding to your clients for whom you hold
Shares registered in your name or in the name of your nominee, or who hold
Shares registered in their own names, we are enclosing the following documents:
1. Offer to Purchase, dated May 6, 1999;
2. Letter of Transmittal to be used by stockholders of the Company in
accepting the Offer and tendering Shares;
3. Notice of Guaranteed Delivery to be used to accept the Offer if
certificates evidencing such Shares (the "Share Certificates") are not
immediately available or time will not permit all required documents to reach
ChaseMellon Shareholder Services, L.L.C. (the "Depositary") prior to the
Expiration Date (as defined in the Offer to Purchase) or if the procedures for
book-entry transfer, as set forth in the Offer to Purchase, cannot be completed
on a timely basis;
4. A letter to stockholders of the Company from Michael S. Leeds, President
and Chief Executive Officer of the Company, together with the
Solicitation/Recommendation Statement on Schedule 14D-9 filed with the
Securities and Exchange Commission by the Company;
5. A letter which may be sent to your clients for whose account you hold
Shares registered in your name or in the name of your nominees, with space
provided for obtaining such clients' instructions with regard to the Offer;
6. Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9; and
7. A return envelope addressed to the Depositary.
WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE
THAT THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON THURSDAY, JUNE 3, 1999, UNLESS THE OFFER IS EXTENDED.
In all cases, payment for Shares tendered and accepted for payment pursuant
to the Offer will be made only after timely receipt by the Depositary of (i)
Share Certificates or timely confirmation of a book-entry transfer of such
Shares, into the Depositary's account at The Depository Trust Company pursuant
to the procedures set forth in Section 3 of the Offer to Purchase, (ii) a Letter
of Transmittal (or facsimile thereof) properly completed and duly executed, with
any required signature guarantees, or an Agent's Message (as defined in the
Offer to Purchase) in connection with a book-entry delivery of Shares and (iii)
any other documents required by the Letter of Transmittal.
If a holder of Shares wishes to tender, but cannot deliver his, her or its
Share Certificates or other required documents, or cannot comply with the
procedures for book-entry transfer, prior to the expiration of the Offer, a
tender of Shares may be effected by following the guaranteed delivery procedures
set forth in Section 3 of the Offer to Purchase.
Purchaser will not pay any fees or commissions to any broker, dealer or
other person (other than the Depositary and the Information Agent as described
in the Offer to Purchase) in connection with the solicitation of tenders of
Shares pursuant to the Offer. However, Purchaser will, upon request, reimburse
you for customary mailing and handling expenses incurred by you in forwarding
the enclosed materials to your clients. Purchaser will pay or cause to be paid
any stock transfer taxes payable with respect to the transfer of Shares to it,
except as otherwise provided in Instruction 6 of the enclosed Letter of
Transmittal.
2
<PAGE>
Any inquiries you may have with respect to the Offer, and requests for
additional copies of the enclosed materials, should be made to D.F. King & Co.,
Inc. by telephone at (800) 431-9629 or to Allen & Company Incorporated at (212)
832-8000 or at their respective addresses set forth on the back cover page of
the Offer to Purchase.
Very truly yours,
MFW ACQUISITION CORP.
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY PERSON TO ACT ON BEHALF OF OR AS AN AGENT OF PARENT, PURCHASER, THE
INFORMATION AGENT OR THE DEPOSITARY, OR OF ANY AFFILIATE OF ANY OF THEM, OR
AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENTS ON
BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE ENCLOSED
DOCUMENTS AND THE STATEMENTS CONTAINED THEREIN.
3
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING CLASS A AND CLASS B SHARES OF COMMON STOCK
OF
CMP MEDIA INC.
AT
$39.00 PER SHARE, NET
BY
MFW ACQUISITION CORP.,
A WHOLLY-OWNED SUBSIDIARY
OF
MFW ACQUISITION HOLDINGS CORP.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON THURSDAY, JUNE 3, 1999, UNLESS THE OFFER IS EXTENDED.
May 6, 1999
To Our Clients:
Enclosed for your consideration is an Offer to Purchase, dated May 6, 1999
(the "Offer to Purchase"), and a related Letter of Transmittal (which together
constitute the "Offer") in connection with the offer by MFW Acquisition Corp., a
Delaware corporation ("Purchaser") and a wholly-owned subsidiary of MFW
Acquisition Holdings Corp., a Delaware corporation (the "Parent"), to purchase
all outstanding shares of Class A and Class B Common Stock, par value $.01 per
share (collectively, the "Shares"), of CMP Media Inc., a Delaware corporation
(the "Company"), at a price of $39.00 per Share, net to the seller in cash, upon
the terms and subject to the conditions set forth in the Offer to Purchase. Also
enclosed is the letter to stockholders of the Company from Michael S. Leeds,
President and Chief Executive Officer of the Company, together with the
Solicitation/Recommendation Statement on Schedule 14D-9 filed with the
Securities and Exchange Commission by the Company.
We are (or our nominee is) the holder of record of Shares held by us for
your account. A TENDER FOR SUCH SHARES CAN BE MADE ONLY BY US AS THE HOLDER OF
RECORD 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 SHARES HELD
BY US FOR YOUR ACCOUNT.
We request instructions as to whether you wish us to tender on your behalf
any or all of such Shares held by us for your account, pursuant to the terms and
conditions set forth in the Offer.
Your attention is invited to the following:
1. The tender price is $39.00 per Share, net to the seller in cash.
2. The Offer is being made for all outstanding Shares.
3. The Board of Directors of the Company unanimously has determined that
each of the Offer and the Merger pursuant to the Offer (as defined in the Offer
to Purchase) is fair to, and in the best interests of, the Company's
stockholders and recommends that stockholders of the Company accept the Offer
and tender their Shares.
4. THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON THURSDAY, JUNE 3, 1999, UNLESS THE OFFER IS EXTENDED.
5. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (I) THERE BEING
VALIDLY TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER SHARES
REPRESENTING AT LEAST 51% OF THE VOTING POWER PF ALL OUTSTANDING SHARES ON A
FULLY DILUTED BASIS AND (II) THE EXPIRATION OR TERMINATION OF ANY APPLICABLE
WAITING PERIOD UNDER THE HART-SCOTT-RODINO ANTITRUST
<PAGE>
IMPROVEMENTS ACT OF 1976, AS AMENDED. THE OFFER IS ALSO SUBJECT TO OTHER TERMS
AND CONDITIONS WHICH ARE CONTAINED IN THE OFFER TO PURCHASE.
6. Stockholders who tender Shares will not be obligated to pay brokerage
commissions or, except as set forth in Instruction 6 of the Letter of
Transmittal, transfer taxes on the purchase of Shares by Purchaser pursuant to
the Offer.
If you wish to have us tender any or all of your Shares, please so instruct
us by completing, signing and returning to us the instruction form contained in
this letter. An envelope in which to return your instructions to us is enclosed.
If you authorize the tender of your Shares, all such Shares will be tendered
unless otherwise specified in your instructions. YOUR INSTRUCTIONS TO US SHOULD
BE FORWARDED IN AMPLE TIME TO PERMIT US TO SUBMIT A TENDER ON YOUR BEHALF PRIOR
TO THE EXPIRATION OF THE OFFER.
The Offer is made solely by the Offer to Purchase and the related Letter of
Transmittal, and is being made to all holders of Shares. The Offer is not being
made to (nor will tenders be accepted from or on behalf of) the holders of
Shares in any jurisdiction in which the making of the Offer or the acceptance
thereof would not be in compliance with the laws of such jurisdiction. In any
jurisdiction where the securities, blue sky or other laws require the Offer to
be made by a licensed broker or dealer, the Offer shall be deemed to be made on
behalf of Purchaser by one or more registered brokers or dealers licensed under
the laws of such jurisdiction.
2
<PAGE>
INSTRUCTIONS WITH RESPECT TO THE OFFER
TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
CMP MEDIA INC.
AT
$39.00 PER SHARE, NET
BY
MFW ACQUISITION CORP.,
A WHOLLY-OWNED SUBSIDIARY
OF
MFW ACQUISITION HOLDINGS CORP.
The undersigned acknowledge(s) receipt of your letter and the enclosed Offer
to Purchase of MFW Acquisition Corp., a Delaware corporation ("Purchaser") and a
wholly-owned subsidiary of MFW Acquisition Holdings Corp., a Delaware
corporation, dated May 6, 1999, and the related Letter of Transmittal relating
to shares of Class A and Class B Common Stock, par value $.01 per share
(collectively, the "Shares"), of CMP Media Inc., a Delaware corporation.
This will instruct you to tender to Purchaser the number of Shares indicated
below (or, if no number is indicated below, all Shares) that are held by you for
the account of the undersigned, upon the terms and subject to the conditions set
forth in the Offer to Purchase and Letter of Transmittal.
SIGN HERE
NUMBER AND CLASS OF SHARES TO BE TENDERED:* _____________________________ SHARES
Account Number: ________________
____________________________________________________, Dated: _____________, 1999
Signature(s)
________________________________________________________________________________
Please print name(s) and address(es) here
________________________________________________________________________________
Tax Identification or Social Security Number
* Unless otherwise indicated, it will be assumed that all of your Shares held
by us for your account are to be tendered.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE
PAYER.--Social Security numbers have nine digits separated by two hyphens: i.e.,
000-00-0000. Employer identification numbers have nine digits separated by only
one hyphen: i.e., 00-0000000. The table below will help determine the number to
give the payer.
<TABLE>
<CAPTION>
- -----------------------------------------------------
GIVE THE
SOCIAL SECURITY
OR EMPLOYER
IDENTIFICATION
FOR THIS TYPE OF ACCOUNT: NUMBER OF--
- -----------------------------------------------------
<S> <C> <C>
1. An individual's The individual
account
2. Two or more The actual owner of
individuals (joint the account or, if
account) combined funds, any
one of the
individuals(1)
3. Husband and wife The actual owner of
(joint account) the account or, if
joint funds, either
person(1)
4. Custodian account of The minor(2)
a minor (Uniform
Gift to Minors Act)
5. Adult and minor The adult or, if the
(joint account) minor is the only
contributor, the
minor(1)
6. Account in the name The ward, minor, or
of guardian or incompetent
committee for a person(3)
designated ward,
minor, or
incompetent person
7. a. The usual The grantor-
revocable savings trustee(1)
trust account
(grantor is also
trustee)
b. So-called trust The actual owner(1)
account that is
not a legal or
valid trust under
State law
8. Sole proprietorship The owner(4)
account
- -----------------------------------------------------
<CAPTION>
GIVE THE
SOCIAL SECURITY OR
EMPLOYER
IDENTIFICATION
FOR THIS TYPE OF ACCOUNT: NUMBER OF--
<S> <C> <C>
- -----------------------------------------------------
9. A valid trust, The legal entity (Do
estate, or pension not furnish the
trust identifying number
of the personal
representative or
trustee unless the
legal entity itself
is not designated in
the account
title.)(5)
10. Corporate account The corporation
11. Religious, The organization
charitable, or
educational
organization account
12. Partnership account The partnership
held in the name of
the business
13. Association, club or The organization
other tax-exempt
organization
14. A broker or The broker or
registered nominee nominee
15. Account with the The public entity
Department of
Agriculture in the
name of a public
entity (such as a
State or local
government, school
district, or prison)
that receives
agricultural program
payments
</TABLE>
- ---------------------------------------------
- ---------------------------------------------
(1) List first and circle the name of the person whose number you furnish.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Circle the ward's, minor's or incompetent person's name and furnish such
person's social security number.
(4) Show the name of the owner.
(5) List first and circle the name of the legal trust, estate, or pension trust.
NOTE: If no name is circled when there is more than one name, the number will be
considered to be that of the first name listed.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
PAGE 2
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you don't know your
number, obtain Form SS-5, Application for a Social Security Number Card, or Form
SS-4, Application for Employer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for a
number.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
Payees specifically exempted from backup withholding on ALL payments include
the following:
- A corporation.
- A financial institution.
- An organization exempt from tax under section 501(a), or an individual
retirement plan.
- The United States or any agency or instrumentality thereof.
- A State, the District of Columbia, a possession of the United States, or
any subdivision or instrumentality thereof.
- A foreign government, a political subdivision of a foreign government, or
any agency or instrumentality thereof.
- An international organization or any agency, or instrumentality thereof.
- A registered dealer in securities or commodities registered in the United
States or a possession of the United States.
- A real estate investment trust.
- A common trust fund operated by a bank under section 584(a)
- An exempt charitable remainder trust, or a non-exempt trust described in
section 4947(a)(1).
- An entity registered at all times under the Investment Company Act of
1940.
- A foreign central bank of issue.
Payments of dividends and patronage dividends not generally subject to
backup withholding include the following:
- Payments to nonresident aliens subject to withholding under section 1441.
- Payments to partnerships not engaged in a trade or business in the United
States and which have at least one nonresident partner.
- Payments of patronage dividends where the amount renewed is not paid in
money.
- Payments made by certain foreign organizations.
- Payments made to a nominee.
Payments of interest not generally subject to backup withholding include the
following:
- Payments of interest on obligations issued by individuals. NOTE: You may
be subject to backup withholding if this interest is $600 or more and is
paid in the course of the payer's trade or business and you have not
provided your correct taxpayer identification number to the payer.
- Payments of tax-exempt interest (including exempt-interest dividends under
section 852).
- Payments described in section 6049(b)(5) to non-resident aliens.
- Payments on tax-free covenant bonds under section 1451.
- Payments made by certain foreign organizations.
- Payments made to a nominee.
Exempt payees described above should file Form W-9 to avoid possible erroneous
backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER
IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM, AND RETURN IT TO
THE PAYER. IF THE PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO
SIGN AND DATE THE FORM.
Certain payments other than interest, dividends, and patronage dividends,
that are not subject to information reporting are also not subject to backup
withholding. For details, see the regulations under sections 6041, 6041A(a),
6045, and 6050A.
PRIVACY ACT NOTICE.--Section 6109 requires most recipients of dividend,
interest, or other payments to give taxpayer identification numbers to payers
who must report the payments to IRS. IRS uses the numbers for identification
purposes. Payers must be given the numbers whether or not recipients are
required to file tax returns. Payers must generally withhold 31% of taxable
interest, dividend, and certain other payments to a payee who does not furnish a
taxpayer identification number to a payer. Certain penalties may also apply.
PENALTIES
(1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER.--If you fail
to furnish your taxpayer identification number to a payer, you are subject
to a penalty of $50 for each such failure due to reasonable cause and not to
willful neglect.
(2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING.--If you
make a false statement with no reasonable basis which results in no
imposition of backup withholding, you are subject to a penalty of $500.
(3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION.--Falsifying certifications or
affirmations may subject you to criminal penalties including fines and/or
imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE
SERVICE
<PAGE>
London, April 29, 1999
UNITED NEWS & MEDIA PLC (22-1/4, before open) said it had agreed to buy
CMP MEDIA INC (33-7/8, before open) for $39 per share, a total consideration of
$920 mln after deducting cash on hand. United said members of the Leeds family
and related trusts and foundations holding more than 68% of CMP had agreed to
tender their shares. United said the acquisition of CMP, which has titles such
as InformationWeek and which operates leading Internet sites in the high-tech
business-to-business market, will be neutral for its EPS in the first year and
enhance earnings strongly thereafter. The company said in a statement that
investment in CMPNet will create the leading operator of online sites servicing
the hi-tech business market.
<PAGE>
THIS ANNOUNCEMENT IS NEITHER AN OFFER TO PURCHASE NOR A SOLICITATION OF AN OFFER
TO SELL SHARES. THE OFFER IS MADE SOLELY BY THE OFFER TO PURCHASE DATED MAY 6,
1999 AND THE RELATED LETTER OF TRANSMITTAL AND IS BEING MADE TO ALL HOLDERS
OF SHARES. THE OFFER IS NOT BEING MADE TO (NOR WILL TENDERS BE ACCEPTED
FROM OR ON BEHALF OF) THE HOLDERS OF SHARES IN ANY JURISDICTION IN
WHICH THE MAKING OF THE OFFER OR THE ACCEPTANCE THEREOF WOULD NOT
BE IN COMPLIANCE WITH THE LAWS OF SUCH JURISDICTION. IN THOSE
JURISDICTIONS WHERE SECURITIES, BLUE SKY OR OTHER LAWS
REQUIRE THE OFFER TO BE MADE BY A LICENSED BROKER OR
DEALER, THE OFFER SHALL BE DEEMED TO BE MADE ON
BEHALF OF MFW ACQUISITION CORP. BY ONE OR MORE
REGISTERED BROKERS OR DEALERS LICENSED UNDER
THE LAWS OF SUCH JURISDICTION.
NOTICE OF OFFER TO PURCHASE FOR CASH ALL
OUTSTANDING SHARES OF CLASS A AND CLASS B COMMON STOCK
OF
CMP MEDIA INC.
AT
$39.00 NET PER SHARE
BY
MFW ACQUISITION CORP.,
A WHOLLY-OWNED SUBSIDIARY
OF
MFW ACQUISITION HOLDINGS CORP.
MFW Acquisition Corp., a Delaware corporation ("Purchaser") and a
wholly-owned subsidiary of MFW Acquisition Holdings Corp., a Delaware
corporation ("Parent"), is offering to purchase all outstanding shares of Class
A and Class B common stock, par value $.01 per share (the "Shares"), of CMP
Media Inc., a Delaware corporation (the "Company"), at a price of $39.00 per
Share, net to the seller in cash, upon the terms and subject to the conditions
set forth in the Offer to Purchase, dated May 6, 1999 (the "Offer to Purchase")
and in the related Letter of Transmittal (which together constitute the
"Offer"). Following the Offer, Purchaser intends to effect the Merger described
below.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON THURSDAY, JUNE 3, 1999, UNLESS THE
OFFER IS EXTENDED.
The Offer is conditioned upon, among other things, (i) there being
validly tendered and not withdrawn prior to the expiration of the Offer at least
a majority of the Shares outstanding on a fully diluted basis and (ii) the
expiration or termination of any applicable waiting period under the Hart-
Scott-Rodino Antitrust Improvements Act of 1976, as amended. The Offer is also
subject to other terms and conditions contained in
<PAGE>
the Offer to Purchase.
The Offer is being made pursuant to an Agreement and Plan of Merger,
dated as of April 28, 1999, among Purchaser, Parent and the Company (the "Merger
Agreement"). The Merger Agreement provides that, among other things, after the
purchase of Shares pursuant to the Offer and the satisfaction of the other
conditions set forth in the Merger Agreement and in accordance with the relevant
provisions of the General Corporation Law of the State of Delaware (the "DGCL"),
Purchaser will be merged (the AMerger@) with and into the Company (following the
Merger, the "Surviving Corporation"). Following consummation of the Merger, the
Surviving Corporation will be a wholly-owned subsidiary of Parent. At the
effective time of the Merger (the "Effective Time"), each Share issued and
outstanding immediately prior to the Effective Time (other than Shares owned by
Purchaser, owned by the Company or any direct or indirect wholly-owned
subsidiary of the Company or held by stockholders who shall have demanded and
perfected appraisal rights, if any, under the DGCL) will be canceled and
converted automatically into the right to receive $39.00 in cash, or any higher
price that may be paid per Share in the Offer, without interest.
THE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY HAS DETERMINED THAT
EACH OF THE OFFER AND THE MERGER IS FAIR TO, AND IN THE BEST INTERESTS OF, THE
STOCKHOLDERS OF THE COMPANY, AND RECOMMENDS THAT STOCKHOLDERS ACCEPT THE OFFER
AND TENDER THEIR SHARES PURSUANT TO THE OFFER.
For purposes of the Offer, Purchaser will be deemed to have accepted
for payment (and thereby purchased) Shares validly tendered and not properly
withdrawn as, if and when Purchaser gives oral or written notice to ChaseMellon
Shareholder Services, L.L.C. (the "Depositary") of Purchaser's acceptance for
payment of such Shares pursuant to the Offer. Upon the terms and subject to the
conditions of the Offer, payment for Shares accepted for payment pursuant to the
Offer will be made by deposit of the purchase price therefor with the
Depositary, which will act as agent for tendering stockholders for the purpose
of receiving payments from Purchaser and transmitting such payments to tendering
stockholders whose Shares have been accepted for payment. Under no circumstances
will interest on the purchase price for Shares be paid, regardless of any
extension of the Offer or delay in making such payment. In all cases, payment
for Shares tendered and accepted for payment pursuant to the Offer will be made
only after timely receipt by the Depositary of (i) the certificates evidencing
such Shares (the "Share Certificates") or timely confirmation of a book-entry
transfer of such Shares into the Depositary's account at the Book-Entry Transfer
Facility (as defined in Section 2 of the Offer to Purchase) pursuant to the
procedure set forth in Section 2 of the Offer to Purchase, (ii) the Letter of
Transmittal (or a facsimile thereof), properly completed and duly executed, with
any required signature guarantees, or, in the case of a book-entry transfer, an
Agent's Message (as defined in Section 3 of the Offer to Purchase) and (iii) any
other documents required under the Letter of
<PAGE>
Transmittal.
Purchaser expressly reserves the right, in its sole discretion (subject
to the terms and conditions of the Merger Agreement), at any time and from time
to time, to extend for any reason the period of time during which the Offer is
open, including the occurrence of any condition specified in Section 14 of the
Offer to Purchase, by giving oral or written notice of such extension to the
Depositary. Any such extension will be followed as promptly as practicable by
public announcement thereof, such announcement to be made no later than 9:00
a.m., New York City time, on the next business day after the previously
scheduled Expiration Date (as defined below) of the Offer. During any such
extension, all Shares previously tendered and not withdrawn will remain subject
to the Offer, subject to the rights of a tendering stockholder to withdraw his,
her or its Shares.
The term "Expiration Date" means 12:00 Midnight, New York City time, on
Thursday, June 3, 1999, unless and until Purchaser, in its sole discretion,
shall have extended the period of time during which the Offer is open, in which
event the term "Expiration Date" shall mean the latest time and date at which
the Offer, as so extended by Purchaser, will expire.
Tenders of Shares made pursuant to the Offer are irrevocable except
that such Shares may be withdrawn at any time prior to the Expiration Date and,
unless theretofore accepted for payment by Purchaser pursuant to the Offer, may
also be withdrawn at any time after July 5, 1999. For the withdrawal to be
effective, a written or facsimile transmission notice of withdrawal must be
timely received by the Depositary at one of its addresses set forth on the back
cover page of the Offer to Purchase. Any such notice of withdrawal must specify
the name of the person who tendered the Shares to be withdrawn, the number of
Shares to be withdrawn and the name of the registered holder of such Shares, if
different from that of the person who tendered such Shares. If Share
Certificates evidencing Shares to be withdrawn have been delivered or otherwise
identified to the Depositary, then, prior to the physical release of such Share
Certificates, the serial numbers shown on such Share Certificates must be
submitted to the Depositary and the signature(s) on the notice of withdrawal
must be guaranteed by an Eligible Institution (as defined in Section 3 of the
Offer to Purchase), unless such Shares have been tendered for the account of an
Eligible Institution. If Shares have been tendered pursuant to the procedure for
book-entry transfer as set forth in Section 3 of the Offer to Purchase, any
notice of withdrawal must specify the name and number of the account at the
Book-Entry Transfer Facility to be credited with the withdrawn Shares. All
questions as to the form and validity (including the time of receipt) of any
notice of withdrawal will be determined by Purchaser, in its sole discretion,
whose determination will be final and binding.
The information required to be disclosed by Rule 14d-6(e)(1)(vii) of
the General Rules and Regulations under the Securities Exchange Act of 1934, as
amended, is
<PAGE>
contained in the Offer to Purchase and is incorporated herein by reference.
The Company has provided Purchaser with the Company's stockholder list
and security position listings for the purpose of disseminating the Offer to
holders of Shares. The Offer to Purchase and the related Letter of Transmittal
will be mailed to record holders of Shares whose names appear on the Company's
stockholder list and will be furnished to brokers, dealers, commercial banks,
trust companies and similar persons whose names, or the names of whose nominees,
appear on the stockholder list or, if applicable, who are listed as participants
in a clearing agency's security position listing for subsequent transmittal to
beneficial owners of Shares.
THE OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION WHICH SHOULD BE READ BEFORE ANY DECISION IS MADE WITH
RESPECT TO THE OFFER.
Questions and requests for assistance or for additional copies of the
Offer to Purchase and the related Letter of Transmittal and other tender offer
materials may be directed to the Information Agent as set forth below, and
copies will be furnished promptly at Purchaser's expense. No fees or commissions
will be paid to brokers, dealers or other persons (other than the Information
Agent) for soliciting tenders of Shares pursuant to the Offer.
<TABLE>
<S> <C>
The Information Agent for the Offer is: The Dealer Manager for the Offer is:
D.F. KING & CO., INC. ALLEN & COMPANY INCORPORATED
77 Water Street 711 Fifth Avenue
New York, New York 10005-4495 New York, New York 10022
Banks and Brokers call collect: (212) 269-5550 (212) 832-8000
Call Toll Free: (800) 431-9629
</TABLE>
May 6, 1999
<PAGE>
[Lloyds Bank Plc Letterhead]
United News & Media plc
Ludgate House
245 Blackfriars House
London
SE 1 9UY
For the Attention of Charles Stern, Esq. Finance Director
- ---------------------------------------------------------
29th April 1999
Dear Sirs,
USD 800 MILLION BRIDGE FACILITY
Following are conversations over the last two days, we are pleased to set out
the terms of our offer to provide to you a fully underwritten short-term bridge
of up to USD800 Million.
BORROWER: United News & Media plc (UNM) or a nominated subsidiary
borrower under the guarantee of UNM.
AMOUNT: USD800m.
PURPOSE: To be used solely towards financing the acquisition of
Community Inc.
FINAL MATURITY: The facility is to be repaid not later than the earlier of
31st August 1999 or three months from the date of the first
drawdown.
AVAILABILITY: By way of a cash advance, within 40 days of signing of the
documentation.
INTEREST RATE: 0.50% p.a. over LIBOR plus Mandatory and FSA costs, payable in
arrears at the end of each interest period.
INTEREST PERIODS: 1 or 3 months, subject to the interest periods being of 1 week
duration if the facility has not been successfully syndicated
prior to drawing. Once syndication is complete, the interest
period options revert to 1 or 3 months.
<PAGE>
-2-
PREPAYMENTS: Prepayment will be made at the earliest opportunity as
expressed in your undertaking given to us in the form attached
(Athe Undertaking@).
FEES: (a) UNDERWRITING FEE: USD800,000 flat for Lloyds Bank
payable on signing of this offer letter.
(b) PARTICIPATION FEE: 0.10% flat on the amount of allocated
participations of other banks joining this facility.
Lloyds Bank will take its participation fee on its
allocated participation out of the underwriting fee
referred to in (a) above.
EXPENSES: All legal and other out of pocket expenses incurred by us in
the preparation, negotiation, syndication and execution of the
facility will be for the Borrower=s account.
MARKET FLEX: Our willingness to underwrite the full amount of this facility
is on the understanding that we will be commencing the
syndication at the earliest opportunity with the objective to
place : of the facility to other UK banks (for these purposes
defined as lending companies resident in the UK) before
drawing. In the event the terms indicated are insufficient to
achieve this aim, you will agree, after discussions, to
increase the amount of the participation fee and/or margins to
a level that will achieve the syndication objective.
In the event such flexing of the terms causes the participation
fee to exceed the 0.10% indicated, Lloyds Bank will receive
also a participation fee representing such incremental amount
(i.e. the fee payable less 0.10% flat).
DOCUMENTATION: This commitment is subject to the signing of a loan agreement
based, in essence, on existing UNM syndicated loan agreements
but also to include additional clauses and provisions to cover
the terms unique to this bridge facility and representations
and warranties regarding the acquisition.
SPECIAL (i) SYNDICATION: UNM will provide active assistance in the
CONDITIONS: syndication process through:
(a) Participating in the approach to the banks to be
invited and using its best influence to obtain
participation in this facility.
<PAGE>
-3-
(b) Provision of sufficient information to allow the
invited banks to seek credit approval. We will
require UNM to make bank presentations in order to
provide the necessary background regarding the
acquisition, the tax issues occasioning the need
for the bridge facility and pro forma financial
information.
(i) BORROWING RESTRICTIONS: UNM will ensure that borrowings
under the ,1bn RCF do not exceed ,500m while this
facility is outstanding. Borrowings may only exceed this
level by the amount that cancellations/prepayments are
made under this facility.
(i) THE UNDERTAKING: A condition of our commitment
expressed herein is the receipt of the duly
executed Undertaking.
(iv) NOTIFICATION LETTER: Your acceptance of this offer
will signify your agreement to our sending the
Notification Letter in the form attached to the
Agent of the existing ,1bn RCF and for a copy of
the Notification Letter to be sent to each of the
banks participating in that facility.
We are delighted to have the opportunity to assist UNM and trust that the terms
of this offer are acceptable to you. This offer is valid for your acceptance
until 5:00 pm on Thursday 29th April, 1999. To accept this offer please sign and
return to us the enclosed copy of this letter.
Yours faithfully,
/s/ David K. Buke /s/ Christopher R. Shawyer
David K. Burke Christopher R. Shawyer
Senior Corporate Manager Managing Director
C&IB Capital Markets
Accepted for and on behalf of United News & Media plc
<PAGE>
-4-
/s/ C.R. STERN
- -----------------------------------
Dated 25/4/99
-----------------------------
<PAGE>
[NOTIFICATION LETTER]
To
Lloyds Bank Plc in its capacity as Agent
under the L1 billion Agreement dated 12th May 1997
in favour of United News & Media Plc
Dear Sirs
RE: UNITED NEWS & MEDIA PLC ("UNM") L1 BILLION CREDIT AGREEMENT DATED 12TH MAY
1997 (THE "AGREEMENT")
We refer to the above and write as a matter of courtesy to advise you that
Lloyds Bank Plc is providing certain short term financing to UNM in connection
with the acquisition detailed in the attached press release. In consideration of
Lloyds Bank Plc providing this financing, UNM have agreed that they will not
make drawings under the Agreement which will result in the outstanding
thereunder exceeding ,500,000,000 for a period until 31st August 1999 or such
earlier date as other financing has been arranged, other to the extent that:
(i) the amount outstanding under the short term financing is reduced by
repayment or cancellation and then by the amount of such repayment or
cancellation, or
(ii) such drawings are to repay the short term financing referred to above.
Please forward a copy of this letter to the banks participating in the above
facility.
Yours sincerely
David Burke
Senior Manager
Corporate Banking
Lloyds Bank Plc
<PAGE>
[UNDERTAKING]
Lloyds Bank Plc
St. George=s House
6-8 Eastcheap
London EEC3M 1AE
29th April 1999
Dear Sirs,
THE NEW FACILITY OF US$800,000,000
TO UNITED FINANCE LIMITED (THE "NEW FACILITY")
You are currently making available to us the New Facility in connection with our
acquisition of Community Inc. You are prepared to lend to us the New Facility
until 31st August 1999 at the latest.
Over the next three months we intend to investigate different ways of raising
the US$800,000,000 to repay the loans under the New Facility. As you are aware
we already have over L500,000,000 of head room under a facility dated 12th May
1997 (the "Existing Facility") for which Lloyds Bank Capital Markets is Facility
Agent.
We will ensure that borrowings under the Existing Facility do not exceed ,500m
while the New Facility is outstanding. Borrowings under the Existing Facility
may only exceed this level by the amount that cancellations/prepayments are made
under the New Facility.
In the event we are unable to repay in full all sums due and owing under the New
Facility before the end of the terms of the New Facility we undertake that we
will draw down a sufficient amount under the Existing Facility to repay in full
all amounts due and owing under the New Facility.
This letter is governed by English law.
Yours faithfully,
For and on behalf of
United News & Media plc
<PAGE>
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
UNITED NEWS & MEDIA PLC,
MILLER FREEMAN WORLDWIDE PLC,
MFW ACQUISITION CORP.,
AND
CMP MEDIA INC.
DATED AS OF APRIL 28, 1999
<PAGE>
TABLE OF CONTENTS
<TABLE>
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ARTICLE 1A
THE TENDER OFFER
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1A.1 The Offer.......................................................................................2
1A.2 Company Action..................................................................................3
1A.3 Directors.......................................................................................4
ARTICLE 1
THE MERGER
1.1 The Merger......................................................................................5
1.2 The Closing.....................................................................................5
1.3 Effective Time..................................................................................5
ARTICLE 2
CERTIFICATE OF INCORPORATION, BYLAWS, DIRECTORS AND OFFICERS OF
THE SURVIVING CORPORATION
2.1 Certificate of Incorporation of the Surviving Corporation.......................................6
2.2 Bylaws of the Surviving Corporation.............................................................6
2.3 Directors of the Surviving Corporation..........................................................6
2.4 Officers of the Surviving Corporation...........................................................6
ARTICLE 3
EFFECT OF THE MERGER ON CAPITAL STOCK
3.1 Effect on Capital Stock.........................................................................6
3.2 Exchange of Certificates........................................................................8
3.3 Lost, Stolen or Destroyed Certificates..........................................................9
3.4 Dissenting Shares...............................................................................9
3.5 Taking of Necessary Action; Further Action......................................................9
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
4.1 Organization, Existence and Good Standing.......................................................9
4.2 Subsidiaries and Affiliated Partnerships.......................................................10
4.3 Organization, Existence and Good Standing of the Company Subsidiaries
and the Company Other Entities ................................................................10
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4.4 Company Capital Stock..........................................................................10
4.5 Power and Authority............................................................................11
4.5A Director Action................................................................................12
4.6 Legal Proceedings..............................................................................12
4.7 No Undisclosed Liabilities.....................................................................12
4.8 Absence of Changes.............................................................................12
4.9 No Violation; Consents and Approvals...........................................................12
4.10 Contracts......................................................................................13
4.11 Compliance With Law; Governmental Authorizations...............................................13
4.12 Insurance......................................................................................13
4.13 Tax Matters....................................................................................13
4.14 Employee Benefit Plans.........................................................................14
4.15 Licenses and Regulatory Approvals..............................................................14
4.16 SEC Filings....................................................................................15
4.17 Title to Properties............................................................................16
4.18 Intellectual Property..........................................................................16
4.19 Commissions and Fees...........................................................................16
4.20 Information....................................................................................16
4.21 Opinion of Financial Advisor...................................................................16
4.22 Company Stockholders' Approval.................................................................17
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF MERGER SUB AND PARENT
5.1 Organization, Existence and Capital Stock......................................................17
5.2 Power and Authority............................................................................17
5.3 Legal Proceedings..............................................................................17
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF UNITED AND PARENT
6.1 Organization, Existence and Good Standing......................................................17
6.2 Power and Authority............................................................................18
6.3 Financing......................................................................................18
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6.4 Legal Proceedings..............................................................................18
6.5 No Violation; Consents and Approvals...........................................................18
6.6 Compliance With Law; Governmental Authorizations...............................................19
6.7 Commissions and Fees...........................................................................19
6.8 Information....................................................................................19
6.9 Guaranty by United.............................................................................19
ARTICLE 7
ACCESS TO INFORMATION AND DOCUMENTS
7.1 Access to Information..........................................................................20
7.2 Return of Records..............................................................................20
ARTICLE 8
COVENANTS OF THE COMPANY
8.1 Preservation of Business.......................................................................21
8.2 Material Transactions..........................................................................21
8.3 Meeting of Stockholders........................................................................22
8.4 Accounting Methods.............................................................................23
8.5 No Solicitations...............................................................................23
8.6 Consents.......................................................................................23
ARTICLE 9
COVENANTS OF PARENT AND MERGER SUB
9.1 Employees......................................................................................23
9.2 Indemnification................................................................................24
9.3 Transaction Costs..............................................................................25
ARTICLE 10
COVENANTS OF THE COMPANY, PARENT AND MERGER SUB
10.1 Public Disclosures.............................................................................25
10.2 Other Actions..................................................................................25
10.3 Proxy Statement; Antitrust Filings.............................................................26
10.4 Other Filings and Consents.....................................................................27
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ARTICLE 11
TERMINATION, AMENDMENT AND WAIVER
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11.1 Termination....................................................................................27
11.2 Effect of Termination..........................................................................28
11.3 Amendment......................................................................................28
11.4 Extension; Waiver..............................................................................29
11.5 Expenses and Fees..............................................................................29
ARTICLE 12
CONDITIONS TO CLOSING
12.1 Mutual Condition...............................................................................29
12.2 Conditions to Obligations of Parent and Merger Sub.............................................29
12.3 Conditions to Obligations of the Company.......................................................30
ARTICLE 13
MISCELLANEOUS
13.1 Nonsurvival of Representations and Warranties..................................................31
13.2 Scope of Representations and Warranties........................................................31
13.3 Notices........................................................................................31
13.4 Further Assurances.............................................................................32
13.5 Governing Law..................................................................................32
13.6 "Knowledge"....................................................................................32
13.7 "Material Adverse Effect"......................................................................33
13.8 "Taxes"........................................................................................33
13.9 Captions.......................................................................................33
13.10 Integration of Company Disclosure Schedule ....................................................33
13.11 Entire Agreement ..............................................................................33
13.12 Amendment .....................................................................................33
13.13 Counterparts ..................................................................................33
13.14 Binding Effect; No Third Party Beneficiaries ..................................................34
13.15 Assignment ....................................................................................34
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AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") is entered into as
of April 28, 1999, by and among United News & Media plc, an English public
limited company ("United"), Miller Freeman Worldwide plc, an English public
limited company ("Parent"), MFW Acquisition Corp., a Delaware corporation and a
wholly owned affiliate of Parent ("Merger Sub"), and CMP Media Inc., a Delaware
corporation (the "Company").
W I T N E S S E T H:
WHEREAS, the respective Boards of Directors of Parent, Merger Sub and
the Company each have determined that it is in the best interests of their
respective stockholders for Merger Sub to merge with and into the Company upon
the terms and subject to the conditions of this Agreement (the "Merger"), and
such Boards of Directors have approved such Merger, pursuant to which Merger Sub
will make a cash tender offer (the "Offer") to acquire all shares of the
Company's Class A Common Stock, par value $0.01 per share (the "Class A Common
Stock"), and the Company's Class B Common Stock, par value $0.01 per share (the
"Class B Common Stock" and, collectively with the Class A Common Stock, the
"Company Common Stock"), issued and outstanding for $39.00 per share, or such
higher price as may be paid if the Offer is amended, net to the seller in cash
(the "Cash Price");
WHEREAS, also in furtherance thereof, it is proposed that, following
the consummation of the Offer, Merger Sub will merge with and into the Company
and that the Company Common Stock not tendered and accepted pursuant to the
Offer will thereupon be converted into the right to receive the Cash Price;
WHEREAS, the holders of the Company's Class B Common Stock, who
represent in the aggregate at least 90% of the total voting power of the Company
Common Stock, have agreed to tender the Company Common Stock owned by such
holders to Merger Sub in accordance with the Offer and to vote the shares of
Company Common Stock owned by such holders in favor of the Merger subject to the
terms and conditions of a tender and voting agreement (the "Voting Agreement")
to be entered into by such holders concurrently with the execution and delivery
of this Agreement; and
WHEREAS, each of Parent, Merger Sub and the Company desires to make
certain representations, warranties, covenants and agreements in connection with
the Merger and to prescribe various conditions to the Merger.
NOW, THEREFORE, in consideration of the foregoing, and the mutual
representations, warranties, covenants and agreements contained herein, the
parties hereto do hereby agree as follows:
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ARTICLE 1A
THE TENDER OFFER
1A.1 THE OFFER. (a) Provided that this Agreement shall not have been
terminated in accordance with Section 11.1 hereof and none of the events set
forth in Annex I hereto shall have occurred and be existing, Parent shall cause
Merger Sub to, and Merger Sub shall, commence (within the meaning of Rule 13d-2
under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) the
Offer as promptly as practicable, but in no event later than May 6, 1999, and
shall use all reasonable efforts to consummate the Offer. The obligation of
Merger Sub to accept for payment any shares of Company Common Stock tendered
shall be subject to the satisfaction of only those conditions set forth in Annex
I. Merger Sub expressly reserves the right to waive any such condition or to
increase the Cash Price or, subject to Section 1A.1(b), to make other changes in
the terms and conditions of the Offer. The Cash Price shall be net to the seller
in cash, subject to reduction only for any applicable Federal back-up
withholding or stock transfer taxes payable by the seller. The Company agrees
that no shares of Company Common Stock held by the Company will be tendered
pursuant to the Offer. For purposes of this Agreement, Company Common Stock held
by the trust established pursuant to the 1999 Leeds Family/CMP Media Inc.
Employee Benefit Trust Agreement shall not be deemed to be Company Common Stock
held or owned by the Company.
(b) Without the prior written consent of the Company, Merger Sub
shall not (i) decrease the Cash Price or change the form of consideration
payable in the Offer, (ii) decrease the number of shares of Company Common Stock
sought, (iii) amend or waive satisfaction of the Minimum Condition (as defined
in Annex I) or (iv) impose additional conditions to the Offer or amend any other
term of the Offer in any manner adverse to the holders of Company Common Stock;
provided, however, that Merger Sub may extend the expiration date (x) in its
sole discretion from time to time, if on the initial scheduled expiration date
of the Offer which shall be twenty (20) business days after the date the Offer
is commenced, all conditions to the Offer shall not have been satisfied or
waived; or (y) for a period not to exceed ten (10) business days,
notwithstanding that all conditions to the Offer are satisfied as of such
expiration date of the Offer, if, immediately prior to the initial expiration
date of the Offer (as it may be extended), after giving effect to the automatic
conversion of all tendered and not withdrawn shares of Class B Common Stock
pursuant to the certificate of incorporation of the Company, the shares of Class
A Common Stock tendered and not withdrawn pursuant to the Offer equal less than
90% of the outstanding shares of Class A Common Stock and, in either case,
Merger Sub expressly irrevocably waives any condition (other than the Minimum
Condition) that subsequently may not be satisfied during such extension of the
Offer; or (z) for any period required by any rule, regulation or interpretation
of the Securities and Exchange Commission (the "SEC") or the staff thereof
applicable to the Offer. Parent shall cause Merger Sub to, and Merger Sub shall,
on the terms and subject to the prior satisfaction or waiver of the conditions
of the Offer, accept for payment and purchase, as soon as permitted under the
terms of the Offer, all shares of Company Common Stock validly tendered and not
withdrawn prior to the expiration of the Offer as such expiration may be
extended in accordance with Section 1A.1(b).
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(c) The Offer shall be made by means of an offer to purchase (the
"Offer to Purchase") having only the conditions set forth in Annex I hereto. As
soon as practicable on the date the Offer is commenced, Parent shall cause
Merger Sub to, and Merger Sub shall, file with the SEC a Tender Offer Statement
on Schedule 14D-1 (together with all amendments and supplements thereto, the
"Schedule 14D-1") with respect to the Offer that will comply in all material
respects with the provisions of, and satisfy in all material respects the
requirements of, such Schedule 14D-1 and all applicable Federal securities laws,
and will contain (including as an exhibit) or incorporate by reference the Offer
to Purchase and forms of the related letter of transmittal and summary
advertisement (which documents, together with any supplements or amendments
thereto, and any other SEC schedule or form which is filed in connection with
the Offer and related transactions, are referred to collectively herein as the "
Offer Documents"). Each of Parent, Merger Sub and the Company agrees promptly to
correct any information provided by it for use in the Schedule 14D-1 or the
Offer Documents if and to the extent that such information shall have become
false or misleading in any material respect and to supplement the information
provided by it specifically for use in the Schedule 14D-1 or the Offer Documents
to include any information that shall become necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading, and each of Parent and Merger Sub further agrees to take all
steps necessary to cause the Schedule 14D-1, as so corrected or supplemented, to
be filed with the SEC and the Offer Documents, as so corrected or supplemented,
to be disseminated to holders of Company Common Stock, in each case as and to
the extent required by applicable Federal securities laws. The Company and its
counsel shall be given a reasonable opportunity to review and comment on any
Offer Documents before they are filed with the SEC.
1A.2 COMPANY ACTION. (a) The Company hereby approves of and consents to
the Offer and represents and warrants that its Board of Directors, at a meeting
duly called and held on April 28, 1999, at which all of the Directors were
present, duly approved and adopted this Agreement and the transactions
contemplated hereby, including the Offer and the Merger, recommended that the
stockholders of the Company accept the Offer, tender their Company Common Stock
pursuant to the Offer and approve this Agreement and the transactions
contemplated hereby, including the Merger, and determined that this Agreement
and the transactions contemplated hereby, including the Offer and the Merger,
are fair to and in the best interests of the stockholders of the Company.
(b) The Company shall file with the SEC, as promptly as practicable
after the filing by Merger Sub of the Schedule 14D-1 with respect to the Offer,
a Tender Offer Solicitation/Recommendation Statement on Schedule 14D-9 (together
with any amendments or supplements thereto, the "Schedule 14D-9") that will
comply in all material respects with the provisions of all applicable Federal
securities laws. The Company shall mail such Schedule 14D-9 to the stockholders
of the Company along with the Offer Documents promptly after the commencement of
the Offer. The Schedule 14D-9 and the Offer Documents shall contain the
recommendations of the Board of Directors described in Section 1A.2(a) hereof.
The Company agrees promptly to correct the Schedule 14D-9 if and to the extent
that it shall become false or misleading in any material respect (and Merger
Sub, with respect to written information supplied by it specifically for use in
the Schedule 14D-9, shall promptly notify the Company of any required
corrections of such information and cooperate with the Company with respect to
correcting such information) and to supplement the information contained in the
Schedule 14D-9
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to include any information that shall become necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading, and the Company shall take all steps necessary to cause the
Schedule 14D-9 as so corrected to be filed with the SEC and disseminated to the
Company's stockholders to the extent required by applicable Federal securities
laws. Merger Sub and its counsel shall be given a reasonable opportunity to
review and comment on the Schedule 14D-9 before it is filed with the SEC.
(c) In connection with the Offer, the Company shall promptly upon
execution of this Agreement furnish Merger Sub with mailing labels containing
the names and addresses of all record holders of Company Common Stock and
security position listings of Company Common Stock held in stock depositories,
each as of a recent date, and shall promptly furnish Merger Sub with such
additional information, including updated lists of stockholders, mailing labels
and security position listings, and such other information and assistance as
Merger Sub or its agents may reasonably request for the purpose of communicating
the Offer to the record and beneficial holders of Company Common Stock.
1A.3 DIRECTORS. (a) Promptly upon the purchase by Merger Sub of shares
of Company Common Stock pursuant to the Offer, and from time to time thereafter
as shares of Company Common Stock are acquired by Merger Sub, Merger Sub shall
be entitled to designate such number of directors, rounded up to the next whole
number, on the Board of Directors as will give Merger Sub, subject to compliance
with Section 14(f) of the Exchange Act, representation on the Board of Directors
equal to at least that number of directors which equals the product of the total
number of directors on the Board of Directors (giving effect to the directors
appointed or elected pursuant to this sentence) multiplied by the percentage
obtained by dividing (i) the aggregate number of votes represented by the shares
of Company Common Stock beneficially owned by Merger Sub or any affiliate of
Merger Sub (including for purposes of this Section 1A.3 such shares of Company
Common Stock as are accepted for payment pursuant to the Offer, but excluding
shares of Company Common Stock held by the Company) by (ii) the number of votes
represented by all shares of Company Common Stock outstanding (excluding Company
Common Stock held by the Company). At such times, if requested by Merger Sub,
the Company will also cause each committee of the Board of Directors to include
persons designated by Merger Sub constituting the same percentage of each such
committee as Merger Sub's designees are of the Board of Directors. The Company
shall, upon request by Merger Sub, promptly increase the size of the Board of
Directors or exercise its best efforts to secure the resignations of such number
of directors as is necessary to enable Merger Sub designees to be elected to the
Board of Directors in accordance with the terms of this Section 1A.3 and shall
cause Merger Sub's designees to be so elected; provided, however, that prior to
the Effective Time (as defined in Section 1.3), the Company's Board of Directors
shall always have at least three members who are neither officers, directors,
stockholders or designees of Parent or Merger Sub or any of their affiliates
("Outside Directors"). If the number of directors who are Outside Directors is
reduced below three for any reason prior to the Effective Time, the remaining
directors who are Outside Directors (or if there is only one director who is an
Outside Director) shall be entitled to designate a person (or persons) to fill
such vacancy (or vacancies) who is an Outside Director and who shall be a
director deemed to be an Outside Director for all purposes of this Agreement.
(b) Subject to applicable law, the Company shall promptly take all
action necessary pursuant to Section 14(f) of the Exchange Act and Rule 14f-1
promulgated thereunder
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in order to fulfill its obligations under this Section 1A.3 and shall include in
the Schedule 14D-9 mailed to stockholders promptly after the commencement of the
Offer (or an amendment thereof or an information statement pursuant to Rule
14f-1 if Merger Sub has not theretofore designated directors) such information
with respect to the Company and its officers and directors as is required under
Section 14(f) and Rule 14f-1 in order to fulfill its obligations under this
Section 1A.3.
(c) From and after the election or appointment of Merger Sub's
designees pursuant to this Section 1A.3 and prior to the Effective Time, any
amendment or termination of this Agreement by the Company, any extension by the
Company of the time for the performance of any of the obligations or other acts
of Parent or Merger Sub or waiver of any of the Company's rights hereunder, or
any other action taken by the Company's Board of Directors in connection with
this Agreement, will require the concurrence of a majority of the directors of
the Company then in office who are Outside Directors.
ARTICLE 1
THE MERGER
1.1 THE MERGER. Subject to the terms and conditions set forth in this
Agreement, and in accordance with the applicable provisions of the Delaware
General Corporation Law (the "DGCL"), Merger Sub shall be merged with and into
the Company at the Effective Time. Following the Effective Time, the separate
corporate existence of Merger Sub shall cease, and the Company shall continue as
the surviving corporation (the "Surviving Corporation") and shall succeed to and
assume all of the rights and obligations of Merger Sub and the Company in
accordance with the DGCL. The effect of the Merger shall be as provided in this
Agreement and under the applicable provisions of the DGCL.
1.2 THE CLOSING. The closing of the Merger (the "Closing") will take
place at 10:00 a.m. Eastern Time on a date to be specified by the parties, or as
soon thereafter as practicable following the satisfaction or waiver of all of
the conditions set forth in Article 12 hereof (the "Closing Date"), at the
offices of the Company, 600 Community Drive, Manhasset, New York 11030, unless
another date or place is agreed to in writing by the parties hereto.
1.3 EFFECTIVE TIME. Subject to the provisions of this Agreement, the
parties shall execute and file with the Secretary of State of the State of
Delaware a certificate of merger (the "Certificate of Merger") in accordance
with the relevant provisions of the DGCL and shall make all other filings or
recordings required under the DGCL as soon as practicable on or after the
Closing Date. The Merger shall become effective at such time as the Certificate
of Merger is duly filed with the Secretary of State of the State of Delaware, or
at such other time as the Company and Parent shall agree should be specified in
the Certificate of Merger (the "Effective Time").
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ARTICLE 2
CERTIFICATE OF INCORPORATION, BYLAWS, DIRECTORS AND OFFICERS OF THE
SURVIVING CORPORATION
2.1 CERTIFICATE OF INCORPORATION OF THE SURVIVING CORPORATION. The
certificate of incorporation of Merger Sub, as in effect immediately prior to
the Effective Time and subject to Section 9.2(a) hereof, shall be the
certificate of incorporation of the Surviving Corporation from and after the
Effective Time and until thereafter amended as provided by law; provided,
however, that the name of the Surviving Corporation to be provided in its
certificate of incorporation shall be "CMP Media Inc."
2.2 BYLAWS OF THE SURVIVING CORPORATION. The Bylaws of Merger Sub, as
in effect immediately prior to the Effective Time, shall be the Bylaws of the
Surviving Corporation from and after the Effective Time and until thereafter
altered, amended or repealed in accordance with the laws of the State of
Delaware, the certificate of incorporation of the Company and the Bylaws;
provided, however, that the name of the Surviving Corporation to be provided in
its bylaws shall be "CMP Media Inc."
2.3 DIRECTORS OF THE SURVIVING CORPORATION. The Board of Directors of
the Surviving Corporation shall be comprised of the directors of Merger Sub.
2.4 OFFICERS OF THE SURVIVING CORPORATION. The initial executive
officers of the Surviving Corporation shall be those individuals designated by
Parent immediately prior to the Effective Time.
ARTICLE 3
EFFECT OF THE MERGER ON CAPITAL STOCK
3.1 EFFECT ON CAPITAL STOCK. As of the Effective Time, by virtue of the
Merger and without any action on the part of any holder of any shares of Company
Common Stock or any holder of shares of capital stock of Merger Sub:
(a) CAPITAL STOCK OF MERGER SUB. Each issued and outstanding share
of capital stock of Merger Sub shall be converted into and become one fully paid
and nonassessable share of Common Stock, par value $.01 per share, of the
Surviving Corporation.
(b) CANCELLATION OF TREASURY STOCK. Each share of Company Common
Stock that is owned by the Company, by any subsidiary of the Company or by
Merger Sub shall automatically be canceled and retired and shall cease to exist
without payment of any consideration therefor.
(c) CONVERSION OF THE COMPANY SHARES. Each issued and outstanding
share of Company Common Stock (other than shares to be canceled in accordance
with Section 3.1(b)) shall be converted into the right to receive the Cash
Price. Shares of Company Common Stock to be exchanged for cash pursuant to this
Section 3.1(c) shall hereinafter be referred to as the "Exchanging Company
Shares." As of the Effective Time, all of the Exchanging Company
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Shares shall no longer be outstanding and shall automatically be canceled and
retired and shall cease to exist, and each holder of a certificate representing
any Exchanging Company Shares shall cease to have any rights with respect
thereto, except the right to receive the Cash Price to be paid in consideration
therefor upon surrender of such certificate in accordance with Section 3.2,
without interest.
(d) STOCK OPTIONS AND WARRANTS. With respect to all outstanding
options or warrants (referred to collectively as the "Options" and individually
as an "Option") to purchase or to acquire Company Common Stock, a summary of
which is included in Section 4.4 of the Company Disclosure Schedule (as defined
in Section 4.2(a) hereof) (except for any vested or unvested Options held by
Michael S. Leeds or Daniel H. Leeds, which shall be canceled prior to the
expiration date of the Offer without payment therefor (except for any payments
to be made pursuant to their respective employment agreements)), each holder of
an Option which is surrendered by the holder for cancellation shall be entitled
to receive from the Company, immediately prior to and conditioned upon the
closing of the Offer, for each share of Company Common Stock purchasable under
each Option, an amount in cash in full cancellation of such Option equal to the
excess of the Cash Price over the per share exercise price of such Option (or
such greater amount as Merger Sub shall agree in writing), as such amount may be
reduced by any required withholding in accordance with applicable tax laws. The
Company agrees to use all commercially reasonable efforts to obtain prior to the
expiration date of the Offer written agreements of all holders of Options
legally binding such holders to cancellation of such Options consistent with the
foregoing. The Company's Board of Directors will adopt a resolution terminating
the Company's Stock Incentive Plan, the Directors' Stock Compensation Plan, the
1988 Equity Appreciation Plan and the Employee Stock Purchase Plan (the "ESPP")
(collectively, the "Plans"), effective as of the Effective Date; provided,
however, that with respect to the ESPP, the parties agree as follows: (i) the
Company's Board of Directors shall adopt a resolution providing that
participating employees may not make additional contributions under the ESPP for
any period after April 23, 1999 and the participating employees shall be
entitled to purchase Company Common Stock under the ESPP as of the closing of
the Offer only with respect to contributions made through April 23, 1999, (ii)
each participating employee in the ESPP shall be entitled to receive from the
Company, immediately prior to and conditioned upon the closing of the Offer, the
Cash Price for each share of Company Common Stock such employee is entitled to
purchase under the ESPP in full settlement of such employees' rights and
benefits under the ESPP and (iii) the actions set forth in subsections (i) and
(ii) above shall not be deemed to be a violation or breach of any other
provisions of this Agreement.
(e) RECLASSIFICATION, RECAPITALIZATION, etc. If, between the date
of this Agreement and the Effective Time, the outstanding Company Common Stock
shall have been changed into a different number of shares or a different class
by reason of any reclassification, recapitalization, split-up, combination,
exchange of shares or readjustment or other similar transaction with respect to
Company Common Stock, or a stock dividend thereon shall be declared with a
record date within said period, the Cash Price shall be correspondingly
adjusted. The Company covenants and agrees not to take any action referred to in
the preceding sentence.
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3.2 EXCHANGE OF CERTIFICATES.
(a) EXCHANGE AGENT. Prior to the Effective Time, Parent shall enter
into an agreement with such bank or trust company as may be designated by Parent
(and which institution otherwise shall be reasonably satisfactory to the
Company) (the "Exchange Agent") which provides that Parent shall deposit with
the Exchange Agent as of the Effective Time, for the benefit of the holders of
Exchanging Company Shares, for exchange in accordance with this Article III,
through the Exchange Agent, cash in an amount sufficient to make cash payments
(being hereinafter referred to as the "Exchange Fund") pursuant to Section 3.1
in exchange for outstanding shares of Company Common Stock.
(b) EXCHANGE PROCEDURES. As soon as reasonably practicable after
the Effective Time, the Surviving Corporation shall cause the Exchange Agent to
deliver to each holder of record of a certificate or certificates which
immediately prior to the Effective Time represented outstanding shares of
Company Common Stock (a "Certificate" or the "Certificates") whose shares were
converted pursuant to Section 3.1, a form of letter of transmittal together with
instructions for use in effecting the surrender of the Certificates for payment
therefor. Upon surrender of a Certificate for cancellation to the Exchange Agent
or to such other agent or agents as may be appointed by Parent, together with
such letter of transmittal, duly executed, and such other documents as may
reasonably be required by the Exchange Agent, the holder of such Certificate
shall be entitled to receive in exchange therefor the Cash Price for each share
of Company Common Stock represented by such Certificate payable pursuant to the
provisions of this Article III, and the Certificate so surrendered shall
forthwith be canceled. In the event of a transfer of ownership of shares of
Company Common Stock which is not registered in the transfer records of the
Company, the appropriate Cash Price may be paid to a person other than the
person in whose name the Certificate so surrendered is registered, if such
Certificate shall be properly endorsed or otherwise be in proper form for
transfer, and the person requesting such payment shall pay any transfer or other
taxes required by reason of the Cash Price payment to a person other than the
registered holder of such Certificate or establish to the satisfaction of Parent
that such tax has been paid or is not applicable. Until surrendered as
contemplated by this Section 3.2, each Certificate shall be deemed at any time
after the Effective Time to represent only the right to receive upon such
surrender the Cash Price payment, as contemplated by this Section 3.2, without
interest.
(c) NO FURTHER OWNERSHIP RIGHTS IN EXCHANGING COMPANY SHARES. If,
after the Effective Time, Certificates are presented to the Surviving
Corporation or the Exchange Agent for any reason, they shall be canceled and
exchanged as provided in this Article III, except as otherwise provided by law.
(d) REQUIRED WITHHOLDING. Each of the Exchange Agent, Parent and
the Surviving Corporation shall be entitled to deduct and withhold from any
consideration payable or otherwise deliverable pursuant to this Agreement to any
holder or former holder of Company Common Stock such amounts as may be required
to be deducted or withheld therefrom under the Internal Revenue Code of 1986, as
amended (the "Code"), or under any applicable provision of state, local or
foreign tax law. To the extent such amounts are so deducted or withheld, such
amounts shall be treated for all purposes under this Agreement as having been
paid to the person to whom such amounts would otherwise have been paid.
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3.3 LOST, STOLEN OR DESTROYED CERTIFICATES. In the event any
Certificates shall have been lost, stolen or destroyed, the Exchange Agent shall
be authorized to deliver the Cash Price to the holders of record of such lost,
stolen or destroyed Certificates, upon the making of an affidavit of that fact
by the holder thereof; PROVIDED, HOWEVER, that Parent may, in its discretion and
as a condition precedent to the delivery thereof, require the owner of such
lost, stolen or destroyed Certificates to deliver a bond in such sum as it may
reasonably direct as indemnity against any claim that may be made against
Parent, the Surviving Corporation or the Exchange Agent with respect to the
Certificates alleged to have been lost, stolen or destroyed.
3.4 DISSENTING SHARES. Notwithstanding anything in this Agreement to
the contrary, shares of Company Common Stock outstanding immediately prior to
the Effective Time and held by a holder who has not voted in favor of the Merger
or consented thereto in writing and who has demanded appraisal for such shares
in accordance with Section 262 of the DGCL, if such Section 262 provides for
appraisal rights for such shares in the Merger ("Dissenting Shares"), shall not
be converted into the right to receive the Cash Price as provided in Section
3.1(c), unless and until such holder fails to perfect or withdraws or otherwise
loses his right to appraisal and payment under the DGCL. If, after the Effective
Time, any such holder fails to perfect or withdraws or loses his right to
appraisal, such Dissenting Shares shall thereupon be treated as if they had been
converted as of the Effective Time into the right to receive the Cash Price, if
any, to which such holder is entitled, without interest or dividends thereon.
The Company shall give Parent prompt notice of any demands received by the
Company for appraisal of shares of Company Common Stock and, prior to the
Effective Time, Parent shall have the right to participate in all negotiations
and proceedings with respect to such demands. Prior to the Effective Time, the
Company shall not, except with the prior written consent of Parent, make any
payment with respect to, or settle or offer to settle, any such demands.
3.5 TAKING OF NECESSARY ACTION; FURTHER ACTION. If, at any time after
the Effective Time, any further action is necessary or desirable to carry out
the purposes of this Agreement and to vest the Surviving Corporation with full
right, title and possession to all assets, property, rights, privileges, powers
and franchises of the Company and Merger Sub, the officers and directors of the
Company and Merger Sub will take all such lawful and necessary action, so long
as such action is consistent with this Agreement. Parent shall cause Merger Sub
to perform fully all of its obligations relating to this Agreement and the
transactions contemplated hereby.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to Parent and Merger Sub as
follows:
4.1 ORGANIZATION, EXISTENCE AND GOOD STANDING. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware and has all necessary corporate power to own its
properties and assets and to carry on its business as presently conducted. The
Company is qualified to do business as a foreign corporation in all requisite
jurisdictions, except where failure to so qualify would not have a Material
Adverse Effect (as defined in Section 13.7 hereof) with respect to the Company.
The Company has
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heretofore made available to Parent complete and correct copies of its
certificate of incorporation and bylaws.
4.2 SUBSIDIARIES AND AFFILIATED PARTNERSHIPS.
(a) Section 4.2 of the disclosure schedule prepared and delivered
by the Company to Parent prior to the date hereof (the "Company Disclosure
Schedule") is a list of all subsidiaries (i.e., entities with respect to which
the Company owns at least a majority of the capital stock or other equity
interests) of the Company (individually, a "Company Subsidiary", and
collectively, the "Company Subsidiaries") and their respective jurisdictions of
incorporation or organization.
(b) Also set forth in Section 4.2 of the Company Disclosure
Schedule is a list of all general partnerships in which a general partner is the
Company, a Company Subsidiary or another Company Partnership (individually, a
"Company Partnership" and collectively, the "Company Partnerships"), and any
limited liability company in which the Company, a Company Subsidiary or a
Company Partnership is a member (a "Company LLC") (the Company Partnerships and
the Company LLCs being collectively called the "Company Other Entities") and
their respective jurisdictions of organization.
4.3 ORGANIZATION, EXISTENCE AND GOOD STANDING OF THE COMPANY
SUBSIDIARIES AND THE COMPANY OTHER ENTITIES.
(a) Each Company Subsidiary (i) is a corporation duly organized,
validly existing and in good standing under the laws of its respective
jurisdiction of incorporation or organization; (ii) has all necessary corporate
power to own its properties and assets and to carry on its business as presently
conducted; and (iii) is qualified to do business as a foreign corporation in all
requisite jurisdictions, except where the failure to so qualify would not have a
Material Adverse Effect.
(b) Each Company Partnership has been duly organized and has all
necessary power to own its property and assets and to carry on its business as
presently conducted.
(c) Each Company LLC (i) is a limited liability company validly
formed and in good standing under the laws of its respective state of
organization; (ii) has all necessary power to own its property and assets and to
carry on its business as presently conducted; and (iii) is qualified to do
business as a foreign company in all requisite jurisdictions, except where the
failure to so qualify would not have a Material Adverse Effect.
4.4 COMPANY CAPITAL STOCK.
(a) The Company's authorized capital stock consists of (i)
70,000,000 shares of Common Stock, of which 50,000,000 shares are designated as
Class A Common Stock and 20,000,000 shares are designated as Class B Common
Stock, and (ii) 5,000,000 shares of Preferred Stock, par value $0.01 per share
(the "Company Preferred Stock"). As of April 28, 1999, 12,948,956 shares of
Class A Common Stock were issued and outstanding, 10,152,810 shares of Class B
Common Stock were issued and outstanding, and no shares of Company
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Preferred Stock were issued and outstanding. All of the issued and outstanding
shares of Company Common Stock are duly and validly issued, fully paid and
nonassessable.
(b) The Company has no shares of capital stock reserved for
issuance, except that, as of April 27, 1999, there were 266,311 shares of Class
A Common Stock reserved for issuance upon exercise of options under the
Company's Stock Incentive Plan, 25,827 shares of Class A Common Stock reserved
for issuance under the Directors' Stock Compensation Plan, and 1,446,835 shares
of Class A Common Stock reserved for issuance under the Company's Employee Stock
Purchase Plan. The aggregate number of shares of Company Common Stock employees
will be entitled to purchase under the ESPP with contributions made under the
ESPP through April 23, 1999, as contemplated by Section 3.1(d) hereof, will not
materially exceed 20,418. Since March 31, 1999, the Company has not issued any
shares of capital stock except pursuant to the exercise of options outstanding
as of such date. All shares of the Company Common Stock which may be issued
pursuant to the exercise of outstanding options will be, when issued in
accordance with the respective terms thereof, duly authorized, validly issued,
fully paid and nonassessable. There are no bonds, debentures, notes or other
indebtedness having general voting rights (or convertible into securities having
such rights) of the Company or any Company Subsidiary issued and outstanding.
Except as contemplated by this Agreement, and except for the Company's
obligations under its option plans, there are no outstanding contractual
obligations of the Company to repurchase, redeem, or otherwise acquire any
shares of Company Common Stock. Each of the outstanding shares of capital stock
or interests of each of the Company Subsidiaries and the Company Other Entities
is duly authorized, validly issued, fully paid and nonassessable, and the
Company's shares or interests in the Company Subsidiaries and the Company Other
Entities are owned by the Company or by a Company Subsidiary in each case free
and clear of any lien, claim, option, charge, security interest, limitation,
encumbrance and restriction of any kind, except as set forth in Section 4.4 of
the Company Disclosure Schedule. Section 4.4 of the Company Disclosure Schedule
sets forth a summary description of the number of Options outstanding including
the exercise price for such Options under the Company's Stock Incentive Plan and
the Directors' Stock Compensation Plan.
(c) There is no liability for dividends declared or accumulated but
unpaid with respect to any of the shares of Company Common Stock.
4.5 POWER AND AUTHORITY. The Company has the corporate power to
execute, deliver and perform this Agreement and all agreements and other
documents executed and delivered, or to be executed and delivered, by it
pursuant to this Agreement, and, subject to the satisfaction of the conditions
precedent set forth herein, has taken all action required by its certificate of
incorporation, bylaws or otherwise to authorize the execution, delivery and
performance of this Agreement and such related documents. This Agreement has
been duly executed and delivered by the Company and, assuming this Agreement
constitutes a valid and binding obligation of Parent and Merger Sub, as the case
may be, constitutes a valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms except that the enforcement
hereof may be limited by (a) bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance or other similar laws now or hereafter in effect relating
to creditors' rights generally and (b) general principles of equity (regardless
of whether enforceability is considered in a proceeding in equity or at law).
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4.5A DIRECTOR ACTION. The Board of Directors of the Company (at a
meeting duly called and held) has by the unanimous vote of all directors present
(i) determined that the Offer and the Merger are advisable and fair to and in
the best interests of the Company and its stockholders; (ii) approved the Merger
in accordance with the provisions of Section 251 of the DGCL; (iii) recommended
the approval of this Agreement, the tender of all Company Common Stock pursuant
to the Offer, and the approval of the Merger by the holders of Company Common
Stock and directed that the Merger be submitted for consideration by the
stockholders of the Company; and (iv) approved the Voting Agreement in
accordance with Section 203 of the DGCL.
4.6 LEGAL PROCEEDINGS. Except as set forth in Section 4.6 of the
Company Disclosure Schedule, there is no litigation, arbitration, governmental
investigation or other proceeding pending or, to the knowledge of the Company,
threatened against the Company, the Company Subsidiaries, the Company Other
Entities, or any of their properties or businesses, or the transactions
contemplated by this Agreement.
4.7 NO UNDISCLOSED LIABILITIES. Except as disclosed in Section 4.7 of
the Company Disclosure Schedule, as of the date hereof, none of the Company, the
Company Subsidiaries or the Company Other Entities has any liabilities or
obligations, whether accrued, absolute or contingent, other than (a) liabilities
and obligations that are fully reflected, accrued or reserved for in the
Company's consolidated balance sheet as of December 31, 1998 and (b) obligations
incurred in the ordinary course of business and consistent with past practice
since the date of such consolidated balance sheet.
4.8 ABSENCE OF CHANGES. Since December 31, 1998, there has been no
change in the financial condition, results of operation, assets, liabilities or
business of the Company, the Company Subsidiaries or the Company Other Entities
which, individually or in the aggregate, would have a Material Adverse Effect
with respect to the Company.
4.9 NO VIOLATION; CONSENTS AND APPROVALS.
(a) Except as set forth in Section 4.9 of the Company Disclosure
Schedule, neither the execution and delivery of this Agreement by the Company
nor the consummation by the Company of the transactions contemplated hereby will
(a) violate, conflict with or result in any breach of any provisions of the
respective organizational documents of the Company, the Company Subsidiaries or
the Company Other Entities, (b) violate any order, injunction, judgment, ruling,
law or regulation of any court or governmental authority applicable to the
Company, the Company Subsidiaries or the Company Other Entities, or (c) conflict
with or result in a breach of any provision of, or constitute a default (or an
event which, with notice or lapse of time or both, would constitute a default),
require any third party consent or give rise to any third party right of
termination, purchase or sale under (i) any agreement, contract or other
instrument binding upon the Company, the Company Subsidiaries or the Company
Other Entities or (ii) any license, franchise, permit or other similar
authorization held by the Company, the Company Subsidiaries or the Company Other
Entities, except, with respect to clause (c) above, for violations, conflicts,
defaults, losses and other matters referred to in such clause which, in the
aggregate, would not have a Material Adverse Effect on the Company.
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(b) Neither the execution and delivery of this Agreement by the
Company nor the consummation by the Company of the transactions contemplated
hereby will require any material consent, waiver, approval, authorization or
permit of, or registration or filing with or notification to (any of the
foregoing being a "Consent"), any governmental or regulatory authority, agency,
commission or tribunal, domestic or foreign (a "Governmental Entity"), except
for (i) compliance with any applicable requirements of the Exchange Act, (ii)
the filing of the Certificate of Merger pursuant to the DGCL, (iii) compliance
with applicable state takeover statutes, (iv) compliance with the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR
Act"), (v) Consents required from any foreign Governmental Entity as a result of
the status of Parent or Merger Sub, and (vi) the Schedule 14D-1 and Schedule
14D-9 filings contemplated hereby.
4.10 CONTRACTS. Except as set forth in Section 4.10 of the Company
Disclosure Schedule, each of the material contracts and agreements to which the
Company, the Company Subsidiaries or the Company Other Entities is a party or by
which any of its assets or operations may be bound is in full force and effect
in all material respects, and there are no existing material defaults with
respect to such material contracts and agreements by the Company, the Company
Subsidiaries or the Company Other Entities. The Company has heretofore made
available to Parent complete and correct copies of all such material contracts
and agreements.
4.11 COMPLIANCE WITH LAW; GOVERNMENTAL AUTHORIZATIONS. The Company, the
Company Subsidiaries and the Company Other Entities have operated their
respective businesses in compliance in all material respects with applicable law
and are not in material violation of any order, injunction, judgment, ruling,
law or regulation of any court or governmental authority applicable to the
Company, the Company Subsidiaries or the Company Other Entities.
4.12 INSURANCE. Section 4.12 of the Company Disclosure Schedule lists
all material insurance policies covering the assets, employees and operations of
the Company and the Company Subsidiaries as of the date hereof, showing the
insurers, limits, type of coverage, annual premiums, deductibles and expiration
dates. All such policies are in full force and effect.
4.13 TAX MATTERS. The Company, or a representative of the Company on
its behalf, has duly and timely filed (including within any applicable extension
period) with the appropriate federal, state, local and foreign taxing
authorities all material tax returns which are required to be filed by the
Company or the Company Subsidiaries. The Company and the Company Subsidiaries
have paid all material Taxes (as defined in Section 13.8 hereof) due, other than
Taxes appropriate reserves for which have been made in the Company's financial
statements (and, to the extent material, such reserves have been accurately
described in the Company SEC Reports (as defined in Section 4.16)). There are no
material assessments or adjustments that have been asserted in writing against
the Company or the Company Subsidiaries for any period for which the Company has
not made appropriate reserves in the Company's financial statements included in
the Company SEC Reports. There are no material "deferred intercompany
transactions" or "intercompany transactions" the gain or loss in which has not
yet been taken into account under the consolidated return Treasury Regulations
currently or previously in effect. There are no liens for Taxes on the assets of
the Company or any of the Company Subsidiaries, except for statutory liens for
current Taxes not yet due and payable (and except for liens which do not and
would not, individually or in the aggregate, have a Material Adverse Effect on
the
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Company). Except as set forth in Section 4.13 of the Company Disclosure
Schedule, the Company has not received written notice of any action, suit,
proceeding, audit, claim, deficiency or assessment pending with respect to any
material Taxes of the Company or the Company Subsidiaries.
4.14 EMPLOYEE BENEFIT PLANS.
(a) Except as set forth in Section 4.14(a) of the Company
Disclosure Schedule, the Company neither has established nor maintains nor is
obligated to make contributions to or under or otherwise participate in (i) any
bonus or other type of incentive compensation plan, program, agreement, policy,
commitment, contract or arrangement (whether or not set forth in a written
document), except for annual incentive compensation plans entered into in the
ordinary course of business on an individualized basis as part of the regular
compensation packages made available to salespersons and certain other Company
employees, (ii) any pension, profit-sharing, retirement or similar plan, program
or arrangement, or (iii) any other employee benefit plan, fund or program,
including, but not limited to, those described in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended, and the rules and
regulations promulgated thereunder ("ERISA"). All such plans (individually, a
"Plan" and collectively, the "Plans") have been operated and administered in all
material respects in accordance with, as applicable, ERISA, the Code, Title VII
of the Civil Rights Act of 1964, as amended, the Equal Pay Act of 1967, as
amended, the Age Discrimination in Employment Act of 1967, as amended, and the
related rules and regulations adopted by those federal agencies responsible for
the administration of such laws. No act or failure to act by the Company has
resulted in a "prohibited transaction" (as defined in ERISA) with respect to the
Plans that is not subject to a statutory or regulatory exception. No "reportable
event" (as defined in ERISA) has occurred with respect to any of the Plans which
is subject to Title IV of ERISA other than an event for which the 30-day notice
thereof has been waived by regulation. The Company has not previously made, is
not currently making and is not obligated in any way to make any contributions
to any multi-employer plan within the meaning of the Multi-Employer Pension Plan
Amendments Act of 1980.
(b) Except as disclosed in Section 4.14(b) of the Company
Disclosure Schedule, the Company is not a party to any oral or written (i) union
or collective bargaining agreement, (ii) agreement with any executive officer or
other key employee the benefits of which are contingent, or the terms of which
are materially altered, upon the occurrence of a transaction of the nature
contemplated by this Agreement and which provides for the payment of in excess
of $100,000, or (iii) agreement or plan, including any stock option plan, stock
appreciation rights plan, restricted stock plan or stock purchase plan, any of
the benefits of which will be increased, or the vesting of the benefits of which
will be accelerated, by the occurrence of any of the transactions contemplated
by this Agreement or the value of any of the benefits of which will be
calculated on the basis of any of the transactions contemplated by this
Agreement. Section 9.3 of the Company Disclosure Schedule contains a reasonably
accurate estimate of the bonuses, benefits, fees and costs described in Section
9.3 of this Agreement.
4.15 LICENSES AND REGULATORY APPROVALS. The Company Subsidiaries and
the Company Other Entities hold all material licenses, permits and other
regulatory approvals which are needed or required by law with respect to their
businesses and operations, as they are
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currently or presently conducted (collectively, the "Licenses"). All such
Licenses are in full force and effect, and the Company is in compliance in all
material respects with all conditions and requirements of the Licenses and with
all rules and regulations relating thereto. Any and all past litigation
concerning Licenses and all claims and causes of action raised therein have been
finally adjudicated. No such License has been revoked, conditioned (except as
may be customary) or restricted and no action (equitable, legal or
administrative), arbitration or other process is pending, or to the Company's
knowledge, threatened in writing which in any way challenges the validity of, or
seeks to revoke, condition or restrict any such License.
4.16 SEC FILINGS.
(a) The Company has filed all forms, reports and documents
required to be filed by the Company with the SEC since July 24, 1997 and has
made available to Parent such forms, reports and documents in the form filed
with the SEC. All such required forms, reports and documents (including those
that the Company may file subsequent to the date hereof), as amended, are
referred to herein as the "Company SEC Reports." As of their respective dates,
the Company SEC Reports (i) were prepared in accordance and complied in all
material respects with the requirements of the Securities Act of 1933, as
amended (the "Securities Act"), or the Exchange Act, as the case may be, and the
rules and regulations of the SEC thereunder applicable to such Company SEC
Reports and (ii) did not at the time they were filed contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading. None of
the Company Subsidiaries or Company Other Entities is required to file any
forms, reports or other documents with the SEC.
(b) Each of the audited consolidated balance sheets of the Company
as of December 31, 1997 and 1998, and the consolidated statements of earnings,
stockholders' equity and cash flows of the Company for each of the years in the
three-year period ended December 31, 1998 (including, in each case, any related
notes thereto) contained in the Company SEC Reports (i) complied as to form in
all material respects with the published rules and regulations of the SEC with
respect thereto, (ii) was prepared in accordance with generally accepted
accounting procedures ("GAAP") (applied on a consistent basis except as
disclosed in the notes thereto), and (iii) fairly presented in all material
respects the consolidated financial position of the Company and its consolidated
subsidiaries as at the respective dates thereof and the consolidated results of
the operations and cash flows of the Company and its consolidated subsidiaries
for the periods indicated. As of March 31, 1999, the Company and its
consolidated subsidiaries (the "Consolidated Group") had cash and cash
equivalents (including investments) of $23,908,503 (inclusive of 53,403 shares
of RealNetworks, Inc. stock at a carrying value of $6,522,711). On April 21,
1999, CMP sold its entire holdings of RealNetworks, Inc. stock for $9,965,014.
Between March 31, 1999 and the date hereof the Consolidated Group has not
expended cash outside the ordinary course of its business, and the Company
covenants and agrees that until the consummation of the Offer the Consolidated
Group will not expend cash outside of the ordinary course of business other than
for those expenses relating to or resulting from the transactions contemplated
hereby (a reasonably accurate estimate of the amounts of such expenditures being
included in Section 9.3 of the Company Disclosure Schedule).
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4.17 TITLE TO PROPERTIES. The Company and each of the Company
Subsidiaries has good and valid title to, or, in the case of leased properties
and assets, valid leasehold interests in, all of its tangible properties and
assets, real, personal and mixed, used or held for use in its business, free and
clear of any liens, pledges, charges, security interests or other encumbrances
of any sort ("Liens") except for Liens imposed by law in respect of obligations
not yet due which are owed in respect of taxes or which otherwise are owed to
carriers, warehousepersons or laborers, except as reflected in the Company
Financial Statements and except for such Liens or other imperfections of title
and encumbrances, if any, which would not have, individually or in the
aggregate, a Material Adverse Effect with respect to the Company.
4.18 INTELLECTUAL PROPERTY. The Company, directly or indirectly, owns,
or is licensed or otherwise possesses rights to use, all patents, trademarks,
trade names, service marks, copyrights and any applications therefor,
technology, know-how and tangible or intangible proprietary information that are
material to the business of the Company and the Company Subsidiaries as
currently conducted by the Company or the Company Subsidiaries, except where the
failure to own, license or possess such rights would not have, individually or
in the aggregate, a Material Adverse Effect with respect to the Company.
4.19 COMMISSIONS AND FEES. Except for fees payable to Lazard Freres &
Co. LLC, ("Lazard Freres") which fees and expenses are reflected in its
agreements with the Company, the Company has not employed any investment banker,
broker, finder, consultant or intermediary in connection with the transactions
contemplated by this Agreement which would be entitled to any investment
banking, brokerage, finder's or similar fees or commissions in connection with
this Agreement or the transactions contemplated hereby.
4.20 INFORMATION. None of the information supplied by the Company in
writing specifically for inclusion or incorporation by reference in (i) the
Proxy Statement (as defined in Section 10.3) or the Schedule 14D-1 and Schedule
14D-9 filings contemplated hereby, or (ii) any other document to be filed with
the SEC or other Governmental Entity in connection with the transactions
contemplated by this Agreement (the "Governmental Filings"), will, at the
respective times filed with the SEC or other Governmental Entity or, in the case
of the Proxy Statement, at the date it or any amendment or supplement is mailed
to stockholders, at the time of the Special Meeting (as defined in Section 8.3)
or at the Effective Time, contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary in
order to make the statements made therein, in light of the circumstances under
which they were made, not misleading. The Proxy Statement will comply as to form
in all material respects with the provisions of the Exchange Act and the rules
and regulations thereunder, except that no representation is made by the Company
with respect to statements made therein based on information supplied by Parent
or Merger Sub in writing specifically for inclusion in the Proxy Statement.
4.21 OPINION OF FINANCIAL ADVISOR. The Company has received the written
opinion of Lazard Freres to the effect that the Cash Price is fair to the
holders of the Company Common Stock from a financial point of view.
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4.22 COMPANY STOCKHOLDERS' APPROVAL. The affirmative vote of
stockholders of the Company required for approval and adoption of this Agreement
and the Merger is a majority of the outstanding shares of Company Common Stock
entitled to vote thereon.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF MERGER SUB AND PARENT
Merger Sub and Parent, jointly and severally, hereby represent and
warrant to the Company as follows:
5.1 ORGANIZATION, EXISTENCE AND CAPITAL STOCK. Merger Sub is a
corporation duly organized and validly existing and is in good standing under
the laws of the State of Delaware. The authorized capital of Merger Sub consists
of 1,000 shares of common stock, par value $.01 per share (the "Merger Sub
Common Stock"), all of which shares are issued and registered in the name of
Parent.
5.2 POWER AND AUTHORITY. Merger Sub has corporate power to execute,
deliver and perform this Agreement and all agreements and other documents
executed and delivered, or to be executed and delivered, by it pursuant to this
Agreement, and, subject to the satisfaction of the conditions precedent set
forth herein, has taken all actions required by law, its certificate of
incorporation, its bylaws or otherwise to authorize the execution and delivery
of this Agreement and such related documents. The execution and delivery of this
Agreement do not and, subject to the receipt of required stockholder and
regulatory approvals and any other required third-party consents or approvals,
the consummation of the Merger contemplated hereby will not, violate any
provisions of the certificate of incorporation or bylaws of Merger Sub, or any
provision of, or result in the acceleration of any obligation under, any
mortgage, lien, lease, agreement, instrument, order, arbitration award, judgment
or decree to which Merger Sub is a party or by which it is bound, violate any
restrictions of any kind to which Merger Sub is subject, or result in the
creation of any lien, charge or encumbrances upon any of the property or assets
of Merger Sub. The execution and delivery of this Agreement have been approved
by the Board of Directors and by the sole stockholder of Merger Sub.
5.3 LEGAL PROCEEDINGS. There are no actions, suits or proceedings
pending or threatened against Merger Sub, at law or in equity, relating to or
affecting Merger Sub, including relating to the Merger. Merger Sub does not know
or have any reasonable grounds to know of any justification for any such action,
suit or proceeding.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF UNITED AND PARENT
United and Parent, jointly and severally, hereby represent and warrant
to the Company as follows:
6.1 ORGANIZATION, EXISTENCE AND GOOD STANDING. United is a public
limited company duly organized and validly existing and is in good standing
under the laws of England. Parent is a public limited company duly organized and
validly existing and is in good standing under the
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laws of England. Each of United and Parent has all necessary corporate power to
own its properties and assets and to carry on its business as presently
conducted. Each of United and Parent is duly qualified to do business and is in
good standing in all jurisdictions in which the character of the property owned,
leased or operated or the nature of the business transacted by it makes
qualification necessary, except where the failure to so qualify would not have a
Material Adverse Effect with respect to United or Parent, as appropriate.
6.2 POWER AND AUTHORITY. Each of United and Parent has corporate power
to execute, deliver and perform this Agreement and all agreements and other
documents executed and delivered, or to be executed and delivered, by it
pursuant to this Agreement, and, subject to the satisfaction of the conditions
precedent set forth herein has taken all actions required by law, its
certificate of incorporation, its bylaws or otherwise to authorize the execution
and delivery of this Agreement and such related documents. The execution and
delivery of this Agreement do not and, subject to the receipt of required
stockholder and regulatory approvals and any other required third-party consents
or approvals, the consummation of the Merger contemplated hereby will not,
violate any provisions of the organizational documents of United or Parent, or
any provision of, or result in the acceleration of any obligation under, any
mortgage, lien, lease, agreement, instrument, order, arbitration award, judgment
or decree to which United or Parent is a party or by which it is bound, violate
any restrictions of any kind to which United or Parent is subject or result in
the creation of any lien, charge or encumbrance upon any of the property or
assets of United or Parent. The execution and delivery of this Agreement have
been approved by the Board of Directors of United and Parent. This Agreement has
been duly executed and delivered by United, Parent and Merger Sub and, assuming
this Agreement constitutes a valid and binding obligation of the Company,
constitutes a valid and binding obligation of United, Parent and Merger Sub,
enforceable against United, Parent and Merger Sub in accordance with its terms
except that the enforcement hereof may be limited by (a) bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or other similar laws now or
hereafter in effect relating to creditors' rights generally and (b) general
principles of equity (regardless of whether enforceability is considered in a
proceeding in equity or at law).
6.3 FINANCING. United presently has and, as of the date of the
consummation of the Offer and the Closing Date, as appropriate, will have
delivered to Parent or Merger Sub, cash or cash equivalents on hand in an amount
sufficient to enable Parent or Merger Sub to pay in cash the full amount of the
Cash Price to each holder of shares tendered and not withdrawn pursuant to the
Offer and to each holder of Exchanging Company Shares and consummate the
transactions contemplated hereby.
6.4 LEGAL PROCEEDINGS. There is no litigation, governmental
investigation or other proceeding pending or, so far as is known to United or
Parent, threatened against United or Parent, its respective properties or
business, or the transactions contemplated by this Agreement which would have a
Material Adverse Effect with respect to United or Parent or the transactions
contemplated hereby.
6.5 NO VIOLATION; CONSENTS AND APPROVALS .
(a) Neither the execution and delivery of this Agreement nor the
consummation by United or Parent of the transactions contemplated hereby will
(a) violate,
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conflict with or result in any breach of any provision of the organizational
documents of United or Parent, (b) violate any order, injunction, judgment,
ruling, law or regulation of any court or governmental authority applicable to
United or Parent, or (c) conflict with or result in a breach of any provision
of, or constitute a default (or an event which, with notice or lapse of time or
both, would constitute a default) under (i) any agreement, contract or other
instrument binding upon United or Parent or (ii) any license, franchise, permit
or other similar authorization held by United or Parent, except, with respect to
clauses (b) or (c) above, for violations, conflicts, defaults, losses and other
matters referred to in such clauses which, in the aggregate, would not have a
Material Adverse Effect on Parent or would not materially impair United's or
Parent's ability to consummate the transactions contemplated by this Agreement.
(b) Neither the execution and delivery of this Agreement by United
or Parent or Merger Sub nor the consummation by United, Parent or Merger Sub of
the transactions contemplated hereby will require any Consent of any
Governmental Entity, except for (i) compliance with any applicable requirements
of the Exchange Act, (ii) the filing of the Certificate of Merger pursuant to
the DGCL, (iii) compliance with applicable state takeover statutes, (iv)
compliance with the HSR Act, and (v) the Schedule 14D-1 and Schedule 14D-9
filings contemplated hereby.
6.6 COMPLIANCE WITH LAW; GOVERNMENTAL AUTHORIZATIONS. Each of United
and Parent has operated its business in compliance with applicable law and is
not in violation of any order, injunction, judgment, ruling, law or regulation
of any court or governmental authority applicable to United or Parent except
where such failure to comply or violation would not have a Material Adverse
Effect with respect to United or Parent.
6.7 COMMISSIONS AND FEES. Except for fees payable to Allen & Company
Incorporated, which fees and expenses are reflected in their agreements with
Parent, neither United nor Parent has employed any investment banker, broker,
finder, consultant or intermediary in connection with the transactions
contemplated by this Agreement which would be entitled to any investment
banking, brokerage, finder's or similar fees or commissions in connection with
this Agreement or the transactions contemplated hereby.
6.8 INFORMATION. None of the information supplied or to be supplied by
United, Parent and Merger Sub in writing specifically for inclusion in (i) the
Proxy Statement or the Schedule 14D-1 and Schedule 14D-9 filings contemplated
hereby or (ii) the Governmental Filings will, at the respective times filed with
the SEC or such other Governmental Entity or, in the case of the Proxy
Statement, at the date it or any amendment or supplement is mailed to
stockholders, at the time of the Special Meeting or at the Effective Time,
contains any untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary in order to make the statements
made therein, in light of the circumstances under which they were made, not
misleading.
6.9 GUARANTY BY UNITED. Subject to the provisions of this Section 6.9,
United hereby fully, unconditionally and irrevocably guarantees to the Company
the due and punctual payment of the Cash Price in connection with the Offer and
the Merger and any other monetary obligations of Parent or Merger Sub and the
due and punctual performance of all other obligations of Parent or Merger Sub to
the Company, all in accordance with the terms of this
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Agreement. United hereby acknowledges that, with respect to all of the
obligations of Parent or Merger Sub, including those to pay the Cash Price in
connection with the Offer and the Merger, this guaranty shall be a guaranty of
payment and performance and shall not be conditioned or contingent upon the
pursuit of any remedies against Parent or Merger Sub. United hereby waives
diligence, demand of payment, filing of claims with a court in the event of
merger or bankruptcy of Parent or Merger Sub, any right to require a proceeding
first against Parent or Merger Sub, the benefit of discussion, protest or notice
and all demands whatsoever, and covenants that this guaranty will not be
discharged as to any obligation except by satisfaction of such obligation in
full. To the fullest extent permitted by applicable law, the obligations of
United hereunder shall not be affected by (a) the failure of the Company to
assert any claim or demand or to enforce any right or remedy against United
pursuant to the provisions of this Agreement or otherwise, and (b) any change in
the existence (corporate or otherwise) of Parent or Merger Sub or any
insolvency, bankruptcy, reorganization or similar proceeding affecting any of
them or their assets. United acknowledges that it will receive direct and
indirect benefits from the consummation of the transactions contemplated by this
Agreement and that the waivers set forth in this Section 6.9 are knowingly made
in contemplation of such benefits. Nothing contained in this Section 6.9 is
intended to or shall impair, as between United and the Company, the obligations
of United which are absolute and unconditional, upon failure by either of Parent
or Merger Sub, to perform its respective obligations under this Agreement,
including, without limitation, its obligation to pay the Cash Price in
connection with the Offer and the Merger and any other monetary obligations of
Parent or Merger Sub when payable in accordance with the terms of this
Agreement, nor shall anything herein prevent the Company from exercising all
remedies otherwise permitted by applicable law.
ARTICLE 7
ACCESS TO INFORMATION AND DOCUMENTS
7.1 ACCESS TO INFORMATION. Between the date hereof and the Closing
Date, each of the Company and Parent will give to the other party and its
counsel, accountants and other representatives full access to all the
properties, documents, contracts, personnel files and other records of such
party (and, in the case of the Company, the Company Subsidiaries and the Company
Other Entities) and shall furnish the other party with copies of such documents
and with such information with respect to the affairs of such party as the other
party may from time to time reasonably request. Each party will disclose and
make available to the other party and its representatives all books, contracts,
accounts, personnel records, papers, records, communications with regulatory
authorities and other documents relating to the business and operations of such
party (and, in the case of the Company, the Company Subsidiaries and the Company
Other Entities). All information disclosed by or on behalf of the Company shall
be deemed to be "Evaluation Material" under the terms of the letter agreement,
dated February 19, 1999, between the Company (or its agent, Lazard Freres) and
United (the "Confidentiality Agreement").
7.2 RETURN OF RECORDS. If the transactions contemplated hereby are not
consummated and this Agreement terminates, each party agrees to promptly return
all documents, contracts, records or properties of the other party and all
copies thereof furnished pursuant to this Article 7 or otherwise.
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ARTICLE 8
COVENANTS OF THE COMPANY
8.1 PRESERVATION OF BUSINESS. Between the date hereof and the Effective
Time, the Company will use all commercially reasonable efforts to preserve the
business organization of the Company intact and to preserve for Parent and the
Surviving Corporation the good will of the suppliers, customers and others
having business relations with the Company.
8.2 MATERIAL TRANSACTIONS. Between the date hereof and the Effective
Time, the Company will not (other than as required pursuant to the terms of this
Agreement and the related documents or with respect to transactions described in
Section 8.2 of the Company Disclosure Schedule which do not vary materially from
the terms set forth on such Section 8.2, and will not permit any Company
Subsidiary or Company Other Entity to, without first obtaining the written
consent of Parent, enter into any transactions outside of the ordinary course of
business of the Company or:
(a) encumber any asset or enter into any transaction or make any
contract or commitment relating to the properties, assets and business of the
Company or any Company Subsidiary or Company Other Entity, other than in the
ordinary course of business or as otherwise disclosed herein;
(b) enter into any employment contract which is not terminable at
will or upon notice of 30 days or less and without penalty to the Company or any
Company Subsidiary or Company Other Entity except as provided herein;
(c) issue or sell, or agree to issue or sell, any shares of capital
stock or other securities of the Company, except upon exercise of currently
outstanding stock options or warrants;
(d) except as set forth in Section 8.2(d) of the Company Disclosure
Schedule or as may be required to comply with applicable law, become obligated
under any new pension plan, welfare plan, multi-employer plan, employee benefit
plan, severance plan, benefit arrangement or similar plan or arrangement which
is not in existence on the date hereof, or amend any such plan or arrangement in
existence on the date hereof if such amendment would have the effect of
materially increasing the costs thereof to the Company or any of its affiliates;
(e) declare, set aside or pay any dividend or other distribution
(whether in cash, securities or property or any combination thereof) in respect
of any class or series of its capital stock other than between the Company and
any of its wholly owned subsidiaries;
(f) split, combine, subdivide, reclassify or redeem, purchase or
otherwise acquire, or propose to redeem, purchase or otherwise acquire, any
shares of its capital stock, or any of its other securities;
(g) (i) incur, assume or pre-pay any long-term debt or incur or
assume any short-term debt, except that the Company and the Company Subsidiaries
may incur, assume or pre-pay debt in the ordinary course of business consistent
with past practice under existing lines
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of credit, (ii) assume, guarantee, endorse or otherwise become liable or
responsible (whether directly, contingently or otherwise) for the obligations of
any other person or entity except in the ordinary course of business, or (iii)
make any loans, advances or capital contributions to, or investments in, any
other person or entity except in the ordinary course of business and except for
loans, advances or capital contributions to or investments in any wholly owned
subsidiary of the Company;
(h) issue any stock option under any Plan or any other options,
warrants, convertible securities or other capital stock, and (except as
contemplated by Section 3.1(d) hereof) will not accelerate the vesting or
otherwise modify the terms of any option outstanding under any Plan;
(i) take any action to institute any severance or termination pay
practices with respect to any directors, officers, or employees of the Company
or any of the Company Subsidiaries or Company Other Entities other than those in
effect on the date hereof, or to increase the benefits payable under its
severance or termination pay practices in effect on the date hereof;
(j) adopt or amend, in any material respect, except as may be
required by applicable law or regulation, any collective bargaining, bonus,
profit sharing, compensation, stock option, restricted stock, pension,
retirement, deferred compensation, employment or other employee benefit plan,
agreement, trust, fund, plan or arrangement for the benefit or welfare of any
directors, officers or employees of the Company, or any of the Company
Subsidiaries or Company Other Entities, or make any increase in the salaries,
compensation or pay scales of any such directors, officers or employees; or
(k) amend its certificate of incorporation or bylaws.
From the date of this Agreement through the Effective Time, the Company
will permit two designated representatives of Parent to be present on a
full-time basis at the principal offices of the Company to observe the conduct
of the business of the Company, and the Company will consult with such
representatives prior to taking any actions outside the ordinary course of the
Company's business in any material respect or any actions specified in Section
8.2.
8.3 MEETING OF STOCKHOLDERS.
(a) The Company, as soon as practicable after consummation of the
Offer, if a special meeting of Stockholders is required, will take all steps
necessary in accordance with its certificate of incorporation and bylaws to
call, give notice of, convene and hold a meeting of its stockholders (the
"Special Meeting") for the purpose of approving this Agreement and for such
other purposes as may be necessary or to seek to cause such action to be taken
by written consent to the extent permitted by the DGCL. Unless this Agreement
shall have been validly terminated as provided herein, the Board of Directors of
the Company, subject to its fiduciary duties, will (i) recommend to Company
stockholders the approval of this Agreement, the transactions contemplated
hereby and any other matters to be submitted to the stockholders in connection
therewith, to the extent that such approval is required by applicable law in
order to consummate
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the Merger, and (ii) use commercially reasonable, good faith efforts to obtain
the approval by Company stockholders of this Agreement and the transactions
contemplated hereby.
(b) Nothing contained herein shall affect the right of the Company
or its stockholders to take action by written consent in lieu of meeting to the
extent permitted by law and the certificate of incorporation and bylaws of the
Company.
8.4 ACCOUNTING METHODS. Prior to the Effective Time, the Company shall
not change, in any material respect, its methods of accounting in effect at its
most recent fiscal year end, except as required by changes in GAAP as concurred
in by the Company's independent accountants.
8.5 NO SOLICITATIONS. The Company agrees that, prior to the Effective
Time, it shall not, directly or indirectly, solicit, initiate or encourage any
inquiries or the making of any proposal with respect to any merger,
consolidation or other business combination involving the Company or the Company
Subsidiaries or acquisition of all or substantially all of the assets or capital
stock of the Company and the Company Subsidiaries taken as a whole (an
"ACQUISITION TRANSACTION") or negotiate, explore or otherwise engage in
substantive discussions with any person (other than Parent, Merger Sub or their
respective directors, officers, employees, agents and representatives) with
respect to any Acquisition Transaction or enter into any agreement, arrangement
or understanding requiring it to abandon, terminate or fail to consummate the
Merger or any other transactions contemplated by this Agreement.
8.6 CONSENTS. The Company shall obtain, no later than the date that is
twenty business days after the date hereof, all requisite consents to the
execution, delivery or performance by the Company of this Agreement from Fleet
National Bank or any other requisite lenders in connection with that certain
Credit Agreement, dated as of July 15, 1993, as amended, among the Company,
Fleet National Bank and The Chase Manhattan Bank and that certain Amended and
Restated Negative Pledge Agreement.
ARTICLE 9
COVENANTS OF PARENT AND MERGER SUB
9.1 EMPLOYEES.
(a) As of and after the Effective Time for a period of at least
three years, Parent shall cause the Surviving Corporation to provide to all
officers and employees of the Company, the Company Subsidiaries and the Company
Other Entities (individually, a "Company Employee" and collectively, the
"Company Employees") such retirement benefits, group health plan benefits,
employee benefit plans, programs, arrangements and policies as are no less
favorable, in the aggregate (rather than on an individual plan by plan basis),
than Parent provides to similarly situated employees; provided, however, that
Parent shall cause the Surviving Corporation, to the extent legally permitted,
to maintain and provide to the Company Employees through at least December 31,
1999 those particular employee benefit plans, programs, arrangements and
policies specified in Section 9.1(a) of the Company Disclosure Schedule or plans
substantially similar thereto. Parent shall take all actions required so that
each current and
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former Company Employee will receive credit for his or her service as credited
by the Company prior to the Effective Time (whether for service with the Company
or any predecessor in interest thereto or pursuant to obligations assumed by the
Company in connection with the prior acquisition of assets or capital stock of
other persons or entities) under any employee benefit plans, programs,
arrangements and policies established, maintained, continued or made available
by the Surviving Corporation in which any such current or former Company
Employee is eligible to participate. As soon as practicable after the execution
of this Agreement, Parent shall confer with the Company in good faith to agree
upon mutually acceptable employee benefit and compensation arrangements to be
made available hereunder to the Company Employees.
(b) Without limitation of any other provision of this Agreement,
if, at any time within the calendar year in which the Closing Date occurs, the
Company, any Company Subsidiary or any of the Company Other Entities terminates
the employment of a Company Employee without cause, or such Company Employee
rightfully terminates his or her employment for "good reason" within the meaning
of any agreement between such Company Employee and the Company, any Company
Subsidiary or any of the Company Other Entities, Parent shall pay, or shall
cause to be paid, to such terminated Company Employee, as soon as practicable
after such termination, a pro rata portion of the amount to which the Company
Employee would have been entitled, but for such termination, as an incentive
bonus for such year pursuant to his or her compensation plan for such year. Such
amount shall be prorated based on the number of full weeks of service of such
Company Employee during such year; provided, however, that to the extent the
amount of such incentive bonus is contingent on the attainment of financial
goals of the Company, any Company Subsidiary or any of the Company Other
Entities (and/or any of their respective business units), the amount that shall
be prorated hereunder shall be adjusted so that it bears the same relation to
the total amount of the incentive bonus that the Company Employee was budgeted
to receive for the attainment of such financial goals as the year-to-date
financial results of the Company, such Company Subsidiary or such Company Other
Entity (and/or such business unit, as the case may be) that were actually
attained as of the last day of the month preceding the date of such termination
bear to the year-to-date financial results that were budgeted to be attained as
of the last day of such month.
9.2 INDEMNIFICATION.
(a) From and after the Effective Time, Parent shall cause the
Surviving Corporation to fulfill and honor in all respects the obligations of
the Company pursuant to the indemnification agreements set forth in Section
9.2(a) of the Company Disclosure Schedule in favor of the directors and officers
of the Company (the "Indemnified Parties"). The certificate of incorporation and
bylaws of the Surviving Corporation shall contain provisions with respect to
exculpation and indemnification that are at least as favorable to the
Indemnified Parties as those contained in the certificate of incorporation and
bylaws of the Company as in effect on the date hereof, which provisions shall
not be amended, repealed or otherwise modified for a period of six years from
the Effective Time in any manner that would adversely affect the rights
thereunder of individuals who, immediately prior to the Effective Time, were
directors, officers, employees or agents of the Company, unless such
modification is required by law.
(b) For a period of six years after the Effective Time, Parent
shall cause the Surviving Corporation to use its commercially reasonable efforts
to maintain in effect, if
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available, directors' and officers' liability insurance and employed lawyers
professional liability insurance ("D&O Insurance") covering those persons who
are currently or at the Effective Time covered by the Company's policies for
such insurance on terms comparable to those applicable to the current policies
for such insurance; provided, however, that in no event shall Parent or the
Surviving Corporation be required to expend in excess of 200% of the annual
premium currently paid by the Company for such coverage (or obtain coverage in
excess of the coverage that is available for such 200% of such annual premium).
Promptly after the execution of this Agreement, the Company will consult with
its insurance agents as to the availability and cost of such six year D&O
Insurance extension and the availability and cost of increasing the coverage of
its D&O Insurance for events through the Effective Time to $50 million (or to
incremental amounts between $25 million and $50 million), and the Company will
consult with Parent as to the results of such discussions and obtain binders for
such extended and additional coverage as Parent shall approve, subject to and
effective upon consummation of the Offer.
9.3 TRANSACTION COSTS. Prior to the consummation of the Offer, Parent
shall have caused sufficient funds to be set aside in an escrow account to be
maintained with The Chase Manhattan Bank, N.A. (which is expected to serve as
the depositary for the Offer) under arrangements reasonably acceptable to the
Company to pay all retention bonuses and transaction-based bonuses associated
with the Merger contractually payable by the Company to Company Employees and to
pay the fees and costs of all financial and accounting advisors and legal
counsel retained by the Company in connection with the negotiation and/or
consummation of the Offer and the Merger (with any such funds not required for
such payments to be returned to Parent), a true and complete estimate of which
bonuses, benefits, fees and costs is set forth in Section 9.3 of the Company
Disclosure Schedule.
ARTICLE 10
COVENANTS OF THE COMPANY, PARENT AND MERGER SUB
10.1 PUBLIC DISCLOSURES. Promptly after the execution and delivery of
this Agreement, the Company and Parent will issue a joint press release in a
form that has been mutually approved by the Company and Parent. Parent and the
Company shall not issue any other press release or otherwise make any public
statement with respect to the transactions contemplated by this Agreement prior
to reaching an agreement with respect to the timing and content thereof unless
and only to the extent required to do so by applicable law or regulation or
under the requirements of the Nasdaq National Market system or any other stock
exchange, whether or not such exchange is located within the United States of
America.
10.2 OTHER ACTIONS. None of the Company, Parent and Merger Sub shall,
without the consent of the other party, knowingly or intentionally take any
action, or omit to take any action, if such action or omission would (a) result
in any of its representations and warranties set forth herein being or becoming
untrue in any material respect, or in any of the conditions to the Merger set
forth in this Agreement not being satisfied, (b) (unless such action or omission
is required by applicable law) have a Material Adverse Effect on the ability of
the Company or Parent to obtain any consents or approvals required for the
consummation of the Merger without imposition of a condition or restriction
which would have a Material Adverse Effect on the Surviving Corporation or (c)
otherwise materially impair the ability of the Company or Parent to
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consummate the Merger in accordance with the terms of this Agreement or
materially delay such consummation.
10.3 PROXY STATEMENT; ANTITRUST FILINGS.
(a) As promptly as practicable after consummation of the Offer, if
a special meeting of stockholders is required, the Company will prepare and file
with the SEC a form of proxy statement or other applicable information statement
relating to the Merger (the "Proxy Statement"). The Company will respond to any
comments of the SEC and the Company will cause the Proxy Statement to be mailed
to its stockholders at the earliest practicable time after the SEC has completed
its review of the Proxy Statement. Notwithstanding the foregoing, in the event
that Parent, Merger Sub or any other affiliate of Parent shall acquire at least
90% of the outstanding shares of Company Common Stock pursuant to the Offer, the
parties hereto agree to take all necessary and appropriate action to cause the
Merger to become effective as soon as practicable after the acceptance for
payment of and payment for shares of Company Common Stock by Merger Sub pursuant
to the Offer without a meeting of stockholders of the Company, in accordance
with Section 253 of the DGCL.
(b) As promptly as practicable after the date of this Agreement,
each of the Company and Parent will prepare and file (i) with the United States
Federal Trade Commission (the "FTC") and the Antitrust Division of the United
States Department of Justice (the "DOJ") Notification and Report Forms relating
to the transactions contemplated herein as required by the HSR Act, as well as
comparable pre-merger notification forms required by the merger notification or
control laws and regulations of any applicable jurisdiction, as agreed to by the
parties (the "Antitrust Filings") and (ii) any other filings required to be
filed by it under the Exchange Act, the Securities Act or any other federal,
state or foreign laws relating to the Merger and the transactions contemplated
by this Agreement (the "Other Filings").
(c) The Company and Parent each shall promptly supply the other
with any information which may be required in order to effectuate any filings
pursuant to this Section 10.3. Each of the Company and Parent will notify the
other promptly upon the receipt of any comments from the SEC, FTC or DOJ or
their respective staffs or any other government officials in connection with any
filing made pursuant hereto and of any request by the SEC, FTC or DOJ or their
respective staffs or any other government officials for amendments or
supplements to the Proxy Statement or any Antitrust Filings or Other Filing or
for additional information and will supply the other with copies of all
correspondence between such party or any of its representatives, on the one
hand, and the FTC, DOJ, SEC, or their respective staffs or any other
governmental officials, on the other hand, with respect to the Registration
Statement, the Prospectus/Proxy Statement, the Merger or any Antitrust Filing or
Other Filing. Each of the Company and Parent will cause all documents that it is
responsible for filing with the SEC, FTC or DOJ or other regulatory authorities
under this Section 10.3 to comply in all material respects with all applicable
requirements of law and the rules and regulations promulgated thereunder.
Whenever any event occurs which is required to be set forth in an amendment or
supplement to the Proxy Statement or any Antitrust Filing or Other Filing, the
Company or Parent, as the case may be, will promptly inform the other of such
occurrence and cooperate in filing with the SEC, FTC or DOJ or their respective
staffs or any other government officials, and/or mailing to stockholders of the
Company and/or Parent, such amendment or supplement.
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(d) If any suit is instituted challenging any of the transactions
contemplated hereby as violative of the HSR Act or any other antitrust or trade
regulatory laws or regulations of any Governmental Entity ("Antitrust Laws"),
Parent and the Company shall each cooperate to contest and resist any such
action or proceeding, and to have vacated, lifted, reversed or overturned any
decree, judgment, injunction or other order (whether temporary, preliminary or
permanent) that is in effect and that restricts, prevents or prohibits
consummation of the transactions contemplated by this Agreement, including,
without limitation, by pursuing all reasonable avenues of administrative and
judicial appeal.
10.4 OTHER FILINGS AND CONSENTS.
(a) Parent shall (i) determine whether any filings other than
those described in Section 10.3 are required to be made or consents required to
be obtained in any jurisdiction prior to the Effective Time in connection with
the consummation of the transactions contemplated hereby and make any such
filings promptly and seek to obtain timely any such consents and (ii) use its
best efforts to cause to be lifted any injunction prohibiting the Merger, or any
part thereof, or the other transactions contemplated hereby.
(b) Subject to the terms and conditions herein provided, and
unless this Agreement shall have been validly terminated as provided herein,
each of Parent and the Company shall use all commercially reasonable efforts (i)
to take, or cause to be taken, all actions necessary to comply promptly with all
legal requirements which may be imposed on such party (or any subsidiaries or
affiliates of such party) with respect to this Agreement and to consummate the
transactions contemplated hereby, subject to the votes of its stockholders
described above, and (ii) to obtain (and to cooperate with the other party to
obtain) any consent, authorization, order or approval of, or any exemption by,
any governmental entity and/or any other public or private third party which is
required to be obtained or made by such party or any of its subsidiaries or
affiliates in connection with this Agreement and the transactions contemplated
hereby. Each of Parent and the Company will promptly cooperate with and furnish
information to the other in connection with any such burden suffered by, or
requirement imposed upon, either of them or any of their subsidiaries or
affiliates in connection with the foregoing.
ARTICLE 11
TERMINATION, AMENDMENT AND WAIVER
11.1 TERMINATION. This Agreement may be terminated at any time prior to
the Effective Time, whether before or after approval of matters presented in
connection with the Merger by the holders of shares of Company Common Stock:
(a) by mutual written consent of Parent and the Company; or
(b) by either Parent or the Company:
(i) if, upon a vote at a duly held meeting of stockholders or
any adjournment thereof, any required approval of the holders of shares of the
Company Common Stock shall not have been obtained;
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(ii) if the Merger shall not have been consummated on or
before the date which is six months after the date of this Agreement, unless the
failure to consummate the Merger is the result of a willful and material breach
of this Agreement by the party seeking to terminate this Agreement;
(iii) if any court of competent jurisdiction or other
governmental entity shall have issued an order, decree or ruling or taken any
other action permanently enjoining, restraining or otherwise prohibiting the
Merger, and such order, decree, ruling or other action shall have become final
and nonappealable;
(iv) in the event of a breach by the other party of any
representation, warranty, covenant or other agreement contained in this
Agreement which (A) would give rise to the failure of a condition set forth in
Article 12 and (B) cannot be or has not been cured within 30 days after the
giving of written notice to the breaching party of such breach (a "Material
Breach"); provided that the terminating party is not then in Material Breach of
any representation, warranty, covenant or other agreement contained in this
Agreement; or
(v) if Merger Sub shall have terminated the Offer in
accordance with its terms and conditions, and otherwise not in violation of this
Agreement, without purchasing any shares of Company Common Stock pursuant
thereto; or
(c) by either Parent or the Company in the event that (i) all of
the conditions to the obligation of such party to effect the Merger set forth in
Section 12.1 shall have been satisfied and (ii) any condition to the obligation
of such party to effect the Merger set forth in Section 12.2 (in the case of
Parent) or Section 12.3 (in the case of the Company) is not capable of being
satisfied prior to the end of the period referred to in Section 11.1(b)(ii); or
(d) by Parent, if in violation of Section 8.5 the Company's Board
of Directors shall have (i) determined to withdraw its recommendation of the
Offer or the Merger to the holders of Company Common Stock or (ii) approved,
recommended or endorsed any Acquisition Transaction (as defined in Section 8.5)
other than this Agreement or (iii) resolved to do any of the foregoing.
11.2 EFFECT OF TERMINATION. In the event of termination of this
Agreement as provided in Section 11.1, this Agreement shall forthwith become
void and have no effect, without any liability or obligation on the part of any
party, other than liabilities and obligations under the provisions of Sections
7.1, 7.2 and 11.2, and except to the extent that such termination results from
the willful and material breach by a party of any of its representations,
warranties, covenants or other agreements set forth in this Agreement.
11.3 AMENDMENT. This Agreement may be amended only by a writing signed
on behalf of each of the parties, at any time before or after approval of this
Agreement and the Merger by the stockholders of the Company and prior to the
Effective Time; provided, however, that following approval by the stockholders
of the Company, there shall be no amendments or change to the provisions hereof
which by law requires further approval by such stockholders, without such
further approval.
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<PAGE>
11.4 EXTENSION; WAIVER. At any time prior to the Effective Time of the
Merger, the parties may (a) extend the time for the performance of any of the
obligations or other acts of the other parties, (b) waive any inaccuracies in
the representations and warranties contained in this Agreement or in any
document delivered pursuant to this Agreement or (c) subject to the proviso in
Section 11.3, waive compliance with any of the agreements or conditions
contained in this Agreement. Any agreement on the part of a party to any such
extension or waiver shall be valid only if set forth in an instrument in writing
signed on behalf of such party. The failure of any party to this Agreement to
assert any of its rights under this Agreement or otherwise shall not constitute
a waiver of such rights.
11.5 EXPENSES AND FEES. All costs and expenses incurred in connection
with this Agreement and the transactions contemplated hereby shall be paid by
the party incurring such expense.
ARTICLE 12
CONDITIONS TO CLOSING
12.1 MUTUAL CONDITION. The respective obligations of each party to
consummate the Merger shall be subject to the satisfaction, at or prior to the
Closing Date, of the following conditions (any of which may be waived in writing
by Parent and the Company):
(a) None of Parent, Merger Sub or the Company, nor any of their
respective subsidiaries, shall be subject to any order, decree or injunction by
a court of competent jurisdiction which (i) prevents or materially delays the
consummation of the Merger or (ii) would impose any material limitation on the
ability of Parent effectively to exercise full rights of ownership of the common
stock of the Surviving Corporation or any material portion of the assets or
business of the Company, the Company Subsidiaries and the Company Other Entities
taken as a whole.
(b) No statute, rule, regulation, executive order, decree,
injunction or other order (whether temporary, preliminary or permanent) shall
have been enacted by the government (or any governmental agency) of the United
States or any other country, or any state, municipality or other political
subdivision thereof, that makes the consummation of the Merger and any other
transaction contemplated hereby illegal. All waiting periods, if any, under the
HSR Act relating to the transactions contemplated hereby shall have expired or
terminated early and all material foreign antitrust approvals required to be
obtained prior to the Merger in connection with the transactions contemplated
hereby shall have been obtained.
(c) The requisite holders of Company Common Stock shall have
approved the adoption of this Agreement and any other matters submitted to them
to the extent required by, and in accordance with the provisions of, Section 8.3
hereof.
12.2 CONDITIONS TO OBLIGATIONS OF PARENT AND MERGER SUB. The
obligations of Parent and Merger Sub to consummate the Merger and the other
transactions contemplated hereby shall be subject to the satisfaction, at or
prior to the Closing Date, of the following conditions (any of which may be
waived by Parent and Merger Sub):
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<PAGE>
(a) Each of the agreements of the Company to be performed at or
prior to the Closing Date pursuant to the terms hereof shall have been duly
performed and the Company shall have performed all of the acts required to be
performed by it at or prior to the Closing Date by the terms hereof unless all
such failures together in their entirety, would not, individually or in the
aggregate, have a Material Adverse Effect with respect to the Company or the
consummation of the transactions contemplated by this Agreement.
(b) The representations and warranties of the Company set forth in
Article 4 of this Agreement shall be true and correct as of the date of this
Agreement and as of the Closing except where failure to be so true and correct
would not (in the aggregate for all representations and warranties of the
Company) have a Material Adverse Effect (other than representations and
warranties that are already so qualified, which in each such case shall be true
and correct as written), and except for (i) changes specifically contemplated by
this Agreement and (ii) those representations and warranties that address
matters only as of a particular date (which shall remain true and correct as of
such date); provided, however, that the Company shall not be deemed to be in
breach of any such representations or warranties by taking any action permitted
(or approved by Parent) under Section 8.2. Parent and Merger Sub shall have been
furnished with a certificate, executed by a duly authorized officer of the
Company, dated the Closing Date certifying in such detail as Parent and Merger
Sub may reasonably request as to the fulfillment of the foregoing conditions.
12.3 CONDITIONS TO OBLIGATIONS OF THE COMPANY. The obligations of the
Company to consummate the Merger and the other transactions contemplated hereby
shall be subject to the satisfaction, at or prior to the Closing Date, of the
following conditions (any of which may be waived by the Company):
(a) Each of the agreements of Parent and Merger Sub to be
performed at or prior to the Closing Date pursuant to the terms hereof shall
have been duly performed, in all material respects, and Parent and Merger Sub
shall have performed, in all material respects, all of the acts required to be
performed by them at or prior to the Closing Date by the terms hereof.
(b) The representations and warranties of Merger Sub set forth in
Article 5 and of Parent set forth in Article 6 shall be true and correct, as of
the date of this Agreement and as of the Closing except where failure to be so
true and correct would not (in the aggregate for all representations and
warranties of the Company) have a Material Adverse Effect (other than
representations and warranties that are already so qualified, which in each such
case shall be true and correct as written), and except for (i) changes
specifically contemplated by this Agreement and (ii) those representations and
warranties that address matters only as of a particular date (which shall remain
true and correct as of such date). The Company shall have been furnished with a
certificate, executed by duly authorized officers of Parent and Merger Sub,
dated the Closing Date certifying in such detail as the Company may reasonably
request as to the fulfillment of the foregoing conditions.
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<PAGE>
ARTICLE 13
MISCELLANEOUS
13.1 NONSURVIVAL OF REPRESENTATIONS AND WARRANTIES. None of the
representations and warranties in this Agreement or in any instrument delivered
pursuant to this Agreement shall survive the Effective Time.
13.2 SCOPE OF REPRESENTATIONS AND WARRANTIES. The Company shall be not
be deemed to have made to Parent or Merger Sub any representation or warranty
other than as expressly made by the Company in Article 4 hereof. Without
limiting the generality of the foregoing, and notwithstanding any otherwise
express representations and warranties made by the Company in Article 4 hereof,
the Company makes no representation or warranty to Parent or Merger Sub with
respect to (a) any projections, estimates or budgets heretofore delivered or
made available to Parent of future revenues, expenses or expenditures, future
results of operations and other similar projections or estimates or (b) any
other information or documents made available to Parent or its counsel,
accountants or advisors with respect to the Company, the Company Subsidiaries or
the Company Other Entities, except as expressly covered by a representation and
warranty contained in Article 4 hereof.
13.3 NOTICES. All notices, requests, demands or other communications
required by or otherwise given with respect to this Agreement shall be in
writing and shall be deemed to have been duly given to any party when delivered
personally (by courier service or otherwise), or three business days after being
sent by registered or certified mail with postage prepaid, return receipt
requested (provided, however, that in the case of international mailings, such
time period shall instead be the seventh day after deposit by insured delivery
into the national postal system of the county of origin or on the second
business day after delivery to an overnight courier of recognized international
standing), in each case to the applicable addresses set forth below or to such
other address as such party shall have designated by notice so given to each
other party:
If to the Company:
CMP Media Inc.
600 Community Drive
Manhasset, NY 11030
Attention: Michael S. Leeds
Facsimile: (516) 562-5718
with a copy to:
CMP Media Inc.
600 Community Drive
Manhasset, NY 11030
Attention: Robert D. Marafioti, Esq.
Facsimile: (516) 562-7123
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<PAGE>
with a copy to:
Dow, Lohnes & Albertson, PLLC 1200 New Hampshire
Avenue, N.W.
Suite 800
Washington, D.C. 20036
Attention: Richard L. Braunstein, Esq.
Facsimile: (202) 776-2222
If to United, Parent or Merger Sub:
Miller Freeman Worldwide plc
530 Chiswick High Road
London W4 5BG
England
Attention: Ms. Emma Lewis
Facsimile: 011-44-181-987-7756
with a copy to:
United News & Media plc
Ludgate House
245 Blackfriars Road
London SE1 9UY
England
Attention: Ms. Jane Stables
Facsimile: 011-44-171-921-5047
and a copy to:
Carter, Ledyard & Milburn
2 Wall Street
New York, NY 10005
Attention: James E. Abbott, Esq.
Facsimile: (212) 732-3232
13.4 FURTHER ASSURANCES. Each party hereby agrees to perform any
further acts and to execute and deliver any documents which may be reasonably
necessary to carry out the provisions of this Agreement.
13.5 GOVERNING LAW. This Agreement shall be interpreted, construed and
enforced in accordance with the laws of the State of Delaware, applied without
giving effect to any conflicts-of-law principles.
13.6 "KNOWLEDGE". "To the knowledge," "to the best knowledge" or any
similar phrase shall be deemed to refer to the actual knowledge, after
reasonable investigation, of the Chief Executive Officer and Chief Financial
Officer of a party and also, in the case of the
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<PAGE>
Company, the Company's President of Publishing, President of International,
General Counsel, Chief Information Officer, Senior Vice President (Channel
Group), Vice President (OEM Group), Executive Vice President (BTG Group) and
other corporate officers primarily responsible for a business function relevant
to the issue in question.
13.7 "MATERIAL ADVERSE EFFECT". "Material Adverse Effect" means, when
used in connection with the Company or Parent, any change, effect, event or
occurrence that has, or would have, individually or in the aggregate, a material
adverse impact on the business, assets, liabilities, results of operations or
financial condition of such party and its subsidiaries taken as a whole;
provided, however, that "Material Adverse Effect" shall be deemed to exclude (i)
changes in general economic conditions or changes affecting the industries
generally in which such party operates, (ii) changes in trading prices for such
party's capital stock, (iii) stockholder litigation arising from allegations of
a breach of fiduciary duty relating to this Agreement, and (iv) the impact of
changes in GAAP.
13.8 "TAXES". For purposes of this Agreement, the term "Tax" or "Taxes"
shall mean all taxes, charges, fees, levies, penalties or other assessments
imposed by any United States federal, state, local or foreign taxing authority,
including, but not limited to, income, excise, property, sales, transfer,
franchise, payroll, withholding, Social Security or other taxes, including any
interest, penalties or additions attributable thereto. For purposes of this
Agreement, the term "tax return" shall mean any return, report, information
return or other document (including any related or supporting information) with
respect to Taxes.
13.9 CAPTIONS. The captions or headings in this Agreement are made for
convenience and general reference only and shall not be construed to describe,
define or limit the scope or intent of the provisions of this Agreement.
13.10 INTEGRATION OF COMPANY DISCLOSURE SCHEDULE. The Company
Disclosure Schedule attached to this Agreement is an integral part of this
Agreement as if fully set forth herein, and all statements appearing therein
shall be deemed disclosed for all purposes and not only in connection with the
specific representation in which they are explicitly referenced.
13.11 ENTIRE AGREEMENT. This instrument, including the Company
Disclosure Schedule, all Exhibits attached hereto, together with the
Confidentiality Agreement and the Voting Agreement, contains the entire
agreement of the parties and supersedes any and all prior to contemporaneous
agreements between the parties, written or oral, with respect to the
transactions contemplated hereby.
13.12 AMENDMENT. No provision of this Agreement may be waived, changed,
modified, extended, discharged or terminated, except in a writing signed by the
party or parties against whom enforcement of any waiver, change, modification,
extension, discharge or termination is sought.
13.13 COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which, when so executed, shall be deemed to be any
original, and such counterparts shall, together, constitute and be one and the
same instrument.
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<PAGE>
13.14 BINDING EFFECT; NO THIRD PARTY BENEFICIARIES. This Agreement
shall be binding on, and shall inure to the benefit of, the parties hereto and
their respective successors and assigns. Except for Sections 1A.3, 9.1, 9.2 and
10.3(a), this Agreement is not intended to be for the benefit of and shall not
be enforceable by any person or entity who or which is not a party hereto.
13.15 ASSIGNMENT. No party may assign any right or obligation hereunder
without the prior written consent of the other parties.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement and
Plan of Merger to be executed by their respective duly authorized officers as of
the day and year first above written.
CMP MEDIA INC.
By: /s/ Michael S. Leeds
----------------------
Name: Michael S. Leeds
Title: President and Chief Executive Officer
MFW ACQUISITION CORP.
By: /s/ Donald A. Pazour
----------------------
Name: Donald A. Pazour
Title: Chief Executive Officer
UNITED NEWS & MEDIA PLC
By: /s/ C.R. Stern
----------------
Name: C.R. Stern
Title: Finance Director
MILLER FREEMAN WORLDWIDE PLC
By: /s/ A.M. Tillin
-----------------
Name: A.M. Tillin
Title: Chief Executive Officer
<PAGE>
ANNEX I
Notwithstanding any other provision of this Agreement, Merger Sub shall
not be required to accept for payment or pay for any Company Common Stock
tendered, and may terminate or amend the Offer (subject to the provisions of
this Agreement) and may postpone the acceptance of, and payment for, subject to
Rule 14e-1(c) of the Exchange Act, any Company Common Stock tendered, (A) unless
the following conditions shall have been satisfied: (i) there shall be validly
tendered and not withdrawn prior to the expiration of the Offer a number of
shares of Company Common Stock which represent on a fully diluted basis
(including for purposes of such calculation all Company Common Stock issuable
upon exercise of all vested stock options and warrants and conversion of
convertible securities or other rights to purchase or acquire shares and after
giving effect to the conversion of the Class B Common Stock) at least 51% of the
number and voting power of the shares of Company Common Stock then outstanding
(the " Minimum Condition") and (ii) any applicable waiting period under the HSR
Act shall have expired or been terminated prior to the expiration of the Offer
or (B) if at any time after the date of this Agreement and before the time of
payment for any such Company Common Stock (whether or not any Company Common
Stock has theretofore been accepted for payment or paid for pursuant to the
Offer) any of the following conditions exists:
(a) there shall be in effect an injunction or other order,
decree, judgment or ruling by a court of competent jurisdiction or by a
governmental, regulatory or administrative agency or commission of
competent jurisdiction or a statute, rule, regulation, executive order
or other action or proceeding shall have been promulgated, enacted,
taken, initiated or instituted by a government or a governmental
authority or a governmental, regulatory or administrative agency or
commission of competent jurisdiction which in any such case (i) seeks
to restrain or prohibit the making or consummation of the Offer or the
consummation of the Merger, (ii) seeks to prohibit or restrict in any
material respect the ownership or operation by Merger Sub (or any of
its affiliates or subsidiaries) of any material portion of the
Company's business or assets, or seeks to compel Merger Sub (or any of
its affiliates or subsidiaries) to dispose of or hold separate any
material portion of the Company's business or assets, (iii) seeks to
impose material limitations on the ability of Merger Sub effectively to
acquire or to hold or to exercise full rights of ownership of the
Company Common Stock, including, without limitation, the right to vote
the Company Common Stock purchased by Merger Sub on all matters
properly presented to the stockholders of the Company, or (iv) seeks to
impose any material limitations on the ability of Merger Sub or any of
its affiliates or subsidiaries effectively to control in any material
respect the business and operations of the Company; or
(b) this Agreement shall have been terminated by the Company,
Merger Sub or Parent in accordance with its terms; or
(c) there shall have occurred and be continuing (i) any
general suspension of, or limitation on prices for, trading in
securities on any national securities exchange or the over-the-counter
market, (ii) a declaration of a banking moratorium or any suspension of
payments in respect of banks in the United States, (iii) any limitation
(whether or not mandatory) by any government or Governmental Entity of
the United States on the
<PAGE>
extension of credit by banks or other lending institutions, or (iv) in
the case of any of the foregoing existing at the time of the execution
of this Agreement, a material acceleration or worsening thereof; or
(d) (i) the Board of Directors or any committee thereof shall
have withdrawn, materially modified or changed in a manner adverse to
Parent or Merger Sub the approval or recommendation of the Offer, the
Merger or this Agreement, or approved or recommended any Acquisition
Transaction or any other acquisition of Company Common Stock other than
the Offer or the Merger, or (ii) the Board of Directors or any
committee thereof shall have resolved to do any of the foregoing; or
(e) the representations and warranties of the Company shall
not be true and correct as of the date of this Agreement or as of the
expiration of the Offer except where failure to be so true and correct
would not (in the aggregate for all representations and warranties of
the Company) have a Material Adverse Effect (other than representations
and warranties that are already so qualified, which in each such case
shall be true and correct as written), and except for (i) changes
specifically contemplated by this Agreement and (ii) those
representations and warranties that address matters only as of a
particular date (which shall remain true and correct as of such date);
or
(f) the Company shall have failed to perform any obligation or
to comply with any agreement or covenant of the Company to be performed
or complied with by it under this Agreement unless all such failures
together in their entirety, would not, individually or in the
aggregate, have a Material Adverse Effect; or
(g) the Company shall not have delivered to Parent binding
agreements signed by the holders of Options representing at least 95%
of the Company Common Stock issuable upon exercise of all of the
outstanding Options, agreeing to the cancellation of the Options of
such holders on the terms described in Section 3.1(d) of this
Agreement; or
(h) the Company shall not have delivered to Parent evidence of
binding agreements of the executive officers of the Company to make
payment in full within five business days after the closing of the
Offer (including the delivery of the Cash Price for any shares of
Company Common Stock tendered by such executive officers) of all
amounts of principal and accrued interest, whether or not then due and
owing, under all credit, loan or similar agreements as to which the
Company is a lender to or guarantor of such executive officers; or
(i) there shall since March 31, 1999 have occurred any event
that, individually or when considered together with any other matter,
has had or would have a Material Adverse Effect; or
(j) Merger Sub and the Company shall have agreed that Merger
Sub shall amend the Offer to terminate the Offer or postpone the
payment for Company Common Stock pursuant thereto.
<PAGE>
The foregoing conditions are for the sole benefit of Merger Sub and may
be asserted by Merger Sub regardless of the circumstances giving rise to any
such condition or may be waived by Merger Sub in whole or in part at any time
and from time to time in its sole discretion, subject in each case to the terms
of this Agreement. The failure by Merger Sub at any time to execute any of the
foregoing rights shall not be deemed a waiver of any such right with respect to
particular facts and other circumstances shall not be deemed a waiver with
respect to any other facts and circumstances; and each such right shall be
deemed an ongoing right that may be asserted at any time and from time to time.
<PAGE>
TENDER AND VOTING AGREEMENT
by and among
MFW ACQUISITION CORP.
and
CERTAIN STOCKHOLDERS
OF
CMP MEDIA INC.
Dated as of April 28, 1999
<PAGE>
THIS TENDER AND VOTING AGREEMENT (this "AGREEMENT"), dated as of April
28, 1999, is made and entered into by and among MFW Acquisition Corp., a
Delaware corporation (the "COMPANY"), and the undersigned holders (the
"STOCKHOLDERS") of Class A and Class B Common Stock of CMP Media Inc., a
Delaware corporation ("CMP").
WHEREAS, the Company, Miller Freeman Worldwide plc, an English public
limited company ("Parent"), United News & Media plc, an English public limited
company, and CMP intend to enter into an Agreement and Plan of Merger of even
date herewith (the "MERGER AGREEMENT"), which provides for a tender offer by the
Company for all of the outstanding shares of capital stock of CMP (the "OFFER")
and the merger of the Company with and into CMP and for CMP to become a
wholly-owned affiliate of Parent (the "MERGER");
WHEREAS, at the Effective Time (as defined below) and in accordance
with the terms of the Merger Agreement, each share of Class A Common Stock, par
value $0.01 per share, and each share of Class B Common Stock, par value $0.01
per share, of CMP (the "STOCK") will be converted into the right to receive
$39.00 in cash per share, all as more fully described in the Merger Agreement;
WHEREAS, each Stockholder has the sole right to vote or Dispose of the
number of shares of Stock (collectively, the "SHARES") set forth opposite the
Stockholder's name on SCHEDULE I hereto; and
WHEREAS, as a condition to the Company's willingness to execute and
deliver the Merger Agreement and to consummate the Offer and the Merger and to
the Stockholders' willingness to tender their Shares pursuant to the Offer and
vote their Shares in favor of the Merger, the Stockholders and the Company
desire to establish in this Agreement certain terms and conditions concerning
the Stockholders' Shares with respect to the Offer and the Merger;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth in this Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS
1.01 DEFINITIONS. (a) Except as otherwise specifically indicated, the
following terms have the following meanings for all purposes of this Agreement:
"BENEFICIALLY OWNS" (or comparable variations thereof) has the meaning
set forth in Rule 13d-3 promulgated under the Exchange Act.
"DEPOSITARY" means Chase Manhattan Bank, N.A.
<PAGE>
"DISPOSE" means assign, sell, pledge, hypothecate or otherwise transfer
or dispose of.
"DISPOSITION" means assignment, sale, pledge, hypothecation or other
transfer or disposition.
"EFFECTIVE TIME" means the time at which the Merger becomes effective
under the General Corporation Law of the State of Delaware.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.
"GOVERNMENTAL OR REGULATORY AUTHORITY" means any court, tribunal,
arbitrator, authority, agency, commission, official or other instrumentality of
the United States, any foreign country or any domestic or foreign state, county,
city or other political subdivision.
"LIEN" means any lien, claim, mortgage, encumbrance, pledge, security
interest, equity or charge of any kind.
"PERSON" means any individual, corporation, partnership, limited
liability company, trust, other entity or group (within the meaning of Section
13(d)(3) of the Exchange Act).
"SUBSIDIARY" means any Person in which Parent or CMP, as the case may
be, directly or indirectly through Subsidiaries or otherwise, beneficially owns
more than fifty percent (50%) of the capital stock or other equity interests in
such Person.
(b) In addition, the following terms are defined in the Sections set
forth below:
<TABLE>
<S> <C> <C>
"Alternative Proposal" -- Section 2.03
"CMP" -- Preamble
"Company" -- Preamble
"Leeds Family Agreement" -- Section 2.01(a)
"Merger" -- Preamble
"Merger Agreement" -- Preamble
"Parent" -- Preamble
"Share Certificates" -- Section 2.04
"Shares" -- Preamble
"Stock" -- Preamble
"Stockholders" -- Preamble
"Stockholders' Meeting" -- Section 2.01(c)
</TABLE>
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<PAGE>
(c) Unless the context of this Agreement otherwise requires, (i) words
of any gender include each other gender; (ii) words using the singular or plural
number also include the plural or singular number, respectively; (iii) the terms
"hereof," "herein," "hereby" and derivative or similar words refer to this
entire Agreement; and (iv) the terms "Article" or "Section" refer to the
specified Article or Section of this Agreement. Whenever this Agreement refers
to a number of days, such number shall refer to calendar days unless business
days are specified.
ARTICLE II
COVENANTS OF EACH STOCKHOLDER IN CONNECTION WITH THE OFFER AND THE MERGER
2.01 OWNERSHIP OF SHARES; AGREEMENT TO TENDER; APPROVAL OF MERGER
AGREEMENT.
(a) Until the Effective Time or the earlier termination of this
Agreement in accordance with its terms, each Stockholder agrees (for itself and
not as to any other Stockholder) that he or she will not Dispose of any of the
Shares or any interest therein, deposit any of the Shares into a voting trust or
enter into a voting agreement or arrangement (other than that certain 1997 Leeds
Family Stockholders' Agreement, dated as of June 30, 1997 and as amended (the
"LEEDS FAMILY AGREEMENT ")) or grant any proxy with respect thereto or enter
into any other contract, option or other arrangement or undertaking with respect
to the direct or indirect Disposition of any of the Shares.
(b) Each Stockholder hereby agrees that, if the Company commences the
Offer, such Stockholder will tender, or cause to be tendered, as soon as
practicable (and in any event within ten business days) after the commencement
of the Offer, in accordance with the terms and conditions of the Offer, all
Shares that the Stockholder either owns of record or of which the Stockholder
has the power to control the Disposition as set forth on SCHEDULE I. Each
Stockholder further agrees that he or she will not withdraw such tendered Shares
unless the Offer is terminated by the Company.
(c) Each Stockholder agrees (for itself and not as to any other
Stockholder) that he or she, with respect to those Shares that the Stockholder
either owns of record on the record date for voting at any annual or special
meeting of CMP stockholders to be held for the purpose of voting on the adoption
of the Merger Agreement or for granting any written consent in connection with
the solicitation of written consents in lieu of such a meeting (collectively,
the "STOCKHOLDERS' MEETING") or with respect to which the Stockholder otherwise
controls the vote, will vote or cause to be voted such shares (or execute
written consents with respect to such shares) (i) in favor of the adoption of
the Merger Agreement and the approval of the Merger and the other transactions
contemplated by the Merger Agreement, (ii) against any proposal or offer
(including, without limitation, any proposal or offer to the stockholders of
CMP) with respect to a merger, consolidation or other business combination
including CMP or any of its Subsidiaries or any acquisition or similar
transaction (including, without limitation, a tender or exchange
-3-
<PAGE>
offer) involving the purchase of all or any significant portion of the assets of
CMP and its Subsidiaries taken as a whole or any outstanding shares of the
capital stock of CMP or any Subsidiary of CMP, (iii) against any action which
would result in any of the conditions of the Company's obligation under the
Merger Agreement not being fulfilled and (iv) in favor of any other matter
necessary for the consummation of the transactions contemplated by the Merger
Agreement, including without limitation at the Stockholders' Meeting.
2.02 DIRECTOR ACTIONS. Notwithstanding any other provision of this
Agreement to the contrary, the covenants and agreements set forth herein shall
not prevent each Stockholder from taking any action, subject to the applicable
provisions of the Merger Agreement, while acting in his or her capacity as a
director of CMP in accordance with his or her fiduciary duties.
2.03 NO ALTERNATIVE PROPOSALS. Until the Effective Time or the earlier
termination of this Agreement in accordance with its terms, each Stockholder
agrees (for itself and not as to any other Stockholder) that he or she will not
directly or indirectly through his or her agents and representatives, initiate,
solicit or encourage, any inquiries or the making or implementation of any
alternative proposal (an "ALTERNATIVE PROPOSAL") to acquire the Shares or engage
in any negotiations concerning, or provide any confidential information or data
to, or have any discussions with, any person relating to an Alternative Proposal
or any effort or attempt to make or implement any Alternative Proposal; and such
Stockholder shall (i) immediately cease and cause to be terminated any existing
activities, including discussions or negotiations with any parties, conducted
heretofore with respect to any of the foregoing and will take the necessary
steps to inform his or her agents and representatives of the obligations
undertaken in this Section 2.03, and (ii) notify the Company immediately if any
such inquiries or proposals are received by, any such information is requested
from, or any such negotiations or discussions are sought to be initiated or
continued with, him or her.
2.04 DELIVERY OF CERTIFICATES. Each Stockholder agrees to (i) deliver
one or more certificates evidencing all of such Stockholder's Shares (together
with any replacement certificates or certificates reflecting additional Shares
hereafter acquired by such Stockholder (the "SHARE CERTIFICATES")) to American
Stock Transfer and Trust Company, transfer agent for the Shares, for placement
of an appropriate legend reflecting this Agreement and (ii) keep the Share
Certificates at all times prior to the expiration date of the Offer in the
safekeeping of the Depositary; provided that the Depositary has delivered to
such Stockholder an agreement in form acceptable to such Stockholder and the
Company that the Depositary shall notify such Stockholder and the Company five
business days prior to the date such Share Certificates are to be removed from
the Depositary's safekeeping.
2.05 CONSENTS.
(a) Notwithstanding any pledge agreement or supplement thereto executed
by a Stockholder in favor of Gerard G. Leeds or Liselotte J. Leeds, each of
Gerard G. Leeds and Liselotte J. Leeds hereby consents to the execution,
delivery and performance by any Stockholder of this Agreement and the Merger
Agreement and all transactions contemplated hereby or thereby or necessary in
connection herewith or therewith.
-4-
<PAGE>
(b) Each of Gerard G. Leeds, Liselotte J. Leeds, Michael S. Leeds and
Daniel H. Leeds shall obtain, no later than the date that is twenty business
days after the date hereof, all requisite consents to the execution, delivery or
performance by any Stockholder of this Agreement from Fleet National Bank in
connection with that certain Amended and Restated Negative Pledge Agreement (the
"FLEET AGREEMENT").
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF EACH STOCKHOLDER
Each Stockholder, as to such Stockholder only, hereby represents and
warrants to the Company as follows:
3.01 OWNERSHIP OF SHARES. The Stockholder is the sole beneficial and
record holder of, and has the sole right to vote with respect to, as of the date
hereof, the number of Shares set forth opposite such Stockholder's name on
SCHEDULE I hereto (collectively, the "SHARES"), subject to no rights of others
and free and clear of any Lien (except pursuant to the Fleet Agreement). The
Stockholder's right to vote or Dispose of the Shares is not subject to any
voting trust, voting agreement, voting arrangement or proxy (other than the
Leeds Family Agreement), and such Stockholder has not entered into any other
contract, option or other arrangement or undertaking with respect thereto.
Except for the Shares listed on SCHEDULE I hereto, such Stockholder does not
have any right to acquire, nor does he or she beneficially own any other shares
of any class of capital stock of CMP or any securities convertible into or
exchangeable or exercisable for any shares of any class of capital stock of CMP
(other than shares subject to options or other rights granted by CMP, which
options shall be canceled as contemplated under Section 3.1(d) of the Merger
Agreement).
3.02 AUTHORITY. This Agreement has been duly and validly executed and
delivered by the Stockholder and constitutes a legal, valid and binding
obligation of the Stockholder enforceable against the Stockholder in accordance
with its terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or other similar
laws affecting the enforcement of creditors' rights generally and by general
equitable principles (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
3.03 NO CONFLICTS. The execution and delivery by the Stockholder of
this Agreement do not, and the performance by the Stockholder of his or her
obligations under this Agreement and (other than referred to in Section 2.05
hereof) the consummation of the transactions contemplated hereby will not:
(a) conflict with or result in a violation or breach of any term or
provision of any law, statute, rule or regulation or any order, judgment or
decree of any Governmental or Regulatory Authority applicable to the Stockholder
or any of his or her properties or assets; or
-5-
<PAGE>
(b) (i) conflict with or result in a violation or breach of, (ii)
constitute (with or without notice or lapse of time or both) a default under,
(iii) require the Stockholder to obtain any consent, approval or action of, make
any filing with or give any notice to any Person as a result or under the terms
of, or (iv) result in the creation or imposition of any Lien upon any of the
Stockholder's properties or assets under, any contract, agreement, plan, permit
or license to which the Stockholder is a party, including, but not limited to,
the Leeds Family Agreement.
3.04 OPTIONS AND WARRANTS. Each of Michael S. Leeds and Daniel H. Leeds
hereby represents and warrants as to himself only that he has consented to the
cancellation, prior to the expiration date of the Offer and without payment
therefor (except for any payments to be made pursuant to their respective
employment agreements), of all vested and unvested options and warrants held by
him to purchase Shares.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to the Stockholders as
follows:
4.01 INCORPORATION. The Company is a corporation duly incorporated,
validly existing and in good standing under the laws of the State of Delaware.
The Company has the requisite corporate power and authority to execute and
deliver this Agreement, to perform its obligations hereunder and to consummate
the transactions contemplated hereby.
4.02 AUTHORITY. The execution and delivery by the Company of this
Agreement, and the performance by the Company of its obligations hereunder, have
been duly and validly authorized by the Board of Directors of the Company, no
other corporate action on the part of the Company or its stockholders being
necessary. This Agreement has been duly and validly executed and delivered by
the Company and constitutes a legal, valid and binding obligation of the Company
in accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or
other similar laws affecting the enforcement of creditors' rights generally and
by general equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
4.03 NO CONFLICTS. The execution and delivery by the Company of this
Agreement do not, and the performance by the Company of its obligations under
this Agreement and the consummation of the transactions contemplated hereby will
not:
(a) conflict with or result in a violation or breach of any of the
terms, conditions or provisions of the certificate of incorporation or bylaws of
the Company;
(b) conflict with or result in a violation or breach of any term or
provision of any law, statute, rule or regulation or any order, judgment or
decree of any Governmental or Regulatory Authority applicable to the Company or
any of its properties or assets; or
-6-
<PAGE>
(c) (i) conflict with or result in a violation or breach of, (ii)
constitute (with or without notice or lapse of time or both) a default under,
(iii) require the Company to obtain any consent, approval or action of, make any
filing with or give any notice to any Person as a result or under the terms of,
or (iv) result in the creation or imposition of any Lien upon the Company or any
of its properties or assets under, any contract, agreement, plan, permit or
license to which the Company is a party.
ARTICLE V
GENERAL PROVISIONS
5.01 SURVIVAL OF REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS.
Notwithstanding any right of any party (whether or not exercised) to investigate
the accuracy of the representations and warranties of the other party contained
in this Agreement, each party hereto has the right to rely fully upon the
representations and warranties of the other contained in this Agreement. The
representations and warranties contained herein shall be made as of the date
hereof and as of the consummation of the Offer. Except as provided in SECTION
5.02, the representations, warranties, covenants and agreements of each party
hereto contained in this Agreement will survive until the termination of this
Agreement.
5.02 TERMINATION. This Agreement and all rights and obligations of the
parties hereunder, including, without limitation, the provisions of SECTION
2.01, shall automatically terminate, and shall cease to be of any further force
and effect, upon the earlier to occur of (i) the termination of (a) the Offer in
accordance with its terms and conditions without the Company having purchased
any shares of Stock or (b) the Merger Agreement in accordance with its terms,
and (ii) the mutual written agreement of the Stockholders and the Company.
Notwithstanding the termination of this Agreement, nothing contained herein
shall relieve any party hereto from liability for breach of any of his, her or
its representations, warranties, covenants or agreements contained in this
Agreement.
5.03 AMENDMENT AND WAIVER. (a) This Agreement may be amended,
supplemented or modified only by a written instrument duly executed by or on
behalf of each party hereto.
(b) Any term or condition of this Agreement may be waived at any time
by the party that is entitled to the benefit thereof, but no such waiver shall
be effective unless set forth in a written instrument duly executed by or on
behalf of the party waiving such term or condition. No waiver by any party of
any term or condition of this Agreement, in any one or more instances, shall be
deemed to be or construed as a waiver of the same or any other term or condition
of this Agreement on any future occasion. All remedies, either under this
Agreement or by law or otherwise afforded, will be cumulative and not
alternative.
-7-
<PAGE>
5.04 NOTICES. All notices, requests, demands or other communications
required by or otherwise given with respect to this Agreement shall be in
writing and shall be deemed to have been duly given to any party when delivered
personally (by courier service or otherwise), or three business days after being
sent by registered or certified mail with postage prepaid, return receipt
requested (provided, however, that in the case of international mailings, such
time period shall instead be the seventh day after deposit by insured delivery
into the national postal system of the country of origin or on the second
business day after delivery to an overnight courier of recognized international
standing), in each case to the applicable addresses set forth below or to such
other address as such party shall have designated by notice so given to each
other party:
If to the Stockholders, to:
the addresses set forth on SCHEDULE I hereto
with a copy to:
Dow, Lohnes & Albertson, PLLC
1200 New Hampshire Avenue, N.W.
Suite 800
Washington, D.C. 20036-6802
Facsimile No.: (202) 776-2222
Attn: Edward J. O'Connell, Esq.
If to the Company, to:
Miller Freeman Worldwide, plc
530 Chiswick High Road
London W4 5BG
England
Facsimile No.: 011 44 181 987 7756
Attention: Ms. Emma Lewis
with a copy to:
Carter, Ledyard & Milburn
2 Wall Street
New York, NY 10005
Facsimile No.: (212) 732-3232
Attention: James Abbott, Esq.
-8-
<PAGE>
All such notices, requests and other communications will (i) if delivered
personally to the address as provided in this Section 5.04, be deemed given upon
delivery, (ii) if delivered by facsimile transmission to the facsimile number as
provided in this Section 5.04, be deemed given upon receipt, and (iii) if
delivered by mail in the manner described above to the address as provided in
this Section 5.04, be deemed given upon receipt (in each case regardless of
whether such notice, request or other communication is received by any other
person to whom a copy of such notice, request or other communication is to be
delivered pursuant to this Section 5.04). Any party from time to time may change
its address, facsimile number or other information for the purpose of notices to
that party by giving notice specifying such change to the other parties hereto.
5.05 ENTIRE AGREEMENT. This Agreement supersedes all prior discussions
and agreements among the parties hereto with respect to the subject matter
hereof and contains the sole and entire agreement among the parties hereto with
respect to the subject matter hereof.
5.06 NO THIRD PARTY BENEFICIARY. The terms and provisions of this
Agreement are intended solely for the benefit of each party hereto, and it is
not the intention of the parties to confer third-party beneficiary rights upon
any other Person.
5.07 NO ASSIGNMENT; BINDING EFFECT. Neither this Agreement nor any
right, interest or obligation hereunder may be assigned by any party hereto
without the prior written consent of the other party hereto and any attempt to
do so will be void. Subject to the preceding sentence, this Agreement is binding
upon, inures to the benefit of and is enforceable by the parties hereto and
their respective successors and assigns and legal representatives.
5.08 SPECIFIC PERFORMANCE; LEGAL FEES. The parties acknowledge that
money damages are not an adequate remedy for violations of any provision of this
Agreement and that any party may, in his, her or its sole discretion, apply to a
court of competent jurisdiction for specific performance for injunctive or such
other relief as such court may deem just and proper in order to enforce any such
provision or prevent any violation hereof and, to the extent permitted by
applicable law, each party waives any objection to the imposition of such
relief.
5.09 HEADINGS. The headings used in this Agreement have been inserted
for convenience of reference only and do not define or limit the provisions
hereof.
5.10 INVALID PROVISIONS. If any provision of this Agreement is held to
be illegal, invalid or unenforceable under any present or future law, and if the
rights or obligations of any party hereto under this Agreement will not be
materially and adversely affected thereby, (i) such provision will be fully
severable, (ii) this Agreement will be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part hereof
and (iii) the remaining provisions of this Agreement will remain in full force
and effect and will not be affected by the illegal, invalid or unenforceable
provision or by its severance herefrom.
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<PAGE>
5.11 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware applicable to a contract
executed and performed in such State, without giving effect to the conflicts of
laws principles thereof.
5.12 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.
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<PAGE>
IN WITNESS WHEREOF, each party hereto has signed this Agreement, or
caused this Agreement to be signed by its officer thereunto duly authorized, as
of the date first above written.
MFW ACQUISITION CORP.
By: /s/ Donald A. Pazour
---------------------------------------
Name: Donald A. Pazour
Title: Chief Executive Officer
GERARD G. LEEDS LIFETIME TRUST
By: /s/ Gerard G. Leeds
---------------------------------------
Gerard G. Leeds, as Trustee
LISELOTTE J. LEEDS LIFETIME TRUST
By: /s/ Liselotte J. Leeds
---------------------------------------
Liselotte J. Leeds, as Trustee
/s/ Michael S. Leeds
------------------------------------------
MICHAEL S. LEEDS
/s/ Richard A. Leeds
------------------------------------------
RICHARD A. LEEDS
/s/ Daniel H. Leeds
------------------------------------------
DANIEL H. LEEDS
/s/ Greg Jobin-Leeds
------------------------------------------
GREG JOBIN-LEEDS
/s/ Jennifer Leeds
------------------------------------------
JENNIFER LEEDS
<PAGE>
THE MICHAEL S. LEEDS 1997 GRAT
By: /s/ Michael S. Leeds
----------------------------------------
Michael S. Leeds, as Trustee
THE MICHAEL S. LEEDS 1999 GRAT
By: /s/ Michael S. Leeds
----------------------------------------
Michael S. Leeds, as Trustee
THE RICHARD A. LEEDS 1997 GRAT
By: /s/ Richard A. Leeds
----------------------------------------
Richard A. Leeds, as Trustee
THE DANIEL H. LEEDS 1997 GRAT
By: /s/ Daniel H. Leeds
----------------------------------------
Daniel H. Leeds, as Trustee
THE GREG JOBIN-LEEDS 1997 GRAT
By: /s/ Greg Jobin-Leeds
----------------------------------------
Greg Jobin-Leeds, as Trustee
KALEIDOSCOPE FOUNDATION
By: /s/ Richard A. Leeds
----------------------------------------
Name: Richard A. Leeds
Title: Co-President
<PAGE>
THE GIANT STEPS FOUNDATION
By: /s/ Jennifer Leeds
----------------------------------------
Name: Jennifer Leeds
Title: President
ACCESS FUND, INC.
By: /s/ Greg Jobin-Leeds
----------------------------------------
Name: Greg Jobin-Leeds
Title: Secretary
THE ANDREA AND MICHAEL LEEDS FAMILY
FOUNDATION
By: /s/ Michael S. Leeds
----------------------------------------
Name: Michael S. Leeds
Title: Trustee
THE SUNITA AND DANIEL LEEDS FAMILY
FOUNDATION
By: /s/ Daniel H. Leeds
----------------------------------------
Name: Daniel H. Leeds
Title: Trustee
<PAGE>
SCHEDULE I
SHARES OF COMMON STOCK OWNED BY EACH STOCKHOLDER
4/28/99
<TABLE>
<CAPTION>
STOCKHOLDER NUMBER OF SHARES
CLASS A CLASS B
<S> <C> <C>
Gerard G. Leeds Lifetime Trust -- 1,111,342
c/o CMP Media Inc.
600 Community Drive
Manhasset, NY 11030
Facsimile: (516) 562-7123
Liselotte J. Leeds Lifetime Trust -- 1,106,342
c/o CMP Media Inc.
600 Community Drive
Manhasset, NY 11030
Facsimile: (516) 562-7123
Michael S. Leeds 370,638 1,987,640(1)
c/o CMP Media Inc.
600 Community Drive
Manhasset, NY 11030
Facsimile: (516) 562-7123
Richard A. Leeds 9,300 1,412,737(2)
c/o CMP Media Inc.
600 Community Drive
Manhasset, NY 11030
Facsimile: (516) 562-7123
</TABLE>
- --------
1 Includes 207,504 shares owned by the Michael S. Leeds 1997 GRAT, 750,000
shares owned by the Michael S. Leeds 1999 GRAT and 1,030,136 shares owned by
Michael S. Leeds directly.
2 Includes 975,760 shares owned by the Richard A. Leeds 1997 GRAT and 436,977
shares owned by Richard A. Leeds directly.
<PAGE>
<TABLE>
<S> <C> <C>
Daniel H. Leeds 392,620 1,705,999(3)
c/o CMP Media Inc.
600 Community Drive
Manhasset, NY 11030
Facsimile: (516) 562-7123
Greg Jobin-Leeds -- 1,392,567(4)
c/o CMP Media Inc.
600 Community Drive
Manhasset, NY 11030
Facsimile: (516) 562-7123
Jennifer Leeds -- 1,378,597
c/o CMP Media Inc.
600 Community Drive
Manhasset, NY 11030
Facsimile: (516) 562-7123
Kaleidoscope Foundation 530,820 30,000
c/o CMP Media Inc.
600 Community Drive
Manhasset, NY 11030
Facsimile: (516) 562-7123
The Giant Steps Foundation 303,330 27,586
405 El Camino Real #514
Menlo Park, CA 94025
(650) 332-3112
(no fax)
The Andrea and Michael Leeds 130,000 --
Family Foundation
c/o CMP Media Inc.
Manhasset, NY 11030
Facsimile: (516) 562-7123
</TABLE>
- --------
3 Includes 195,171 shares owned by the Daniel H. Leeds 1997 GRAT and 1,510,828
shares owned by Daniel H. Leeds directly.
4 Includes 330,740 shares owned by the Greg Jobin-Leeds 1997 GRAT and 1,061,827
shares owned by Greg Jobin-Leeds directly.
<PAGE>
<TABLE>
<S> <C> <C>
The Sunita and Daniel Leeds 256,000 --
Family Foundation
c/o Miller Ellin & Co.
750 Lexington Ave
New York, NY 10022
Facsimile: (212) 750-2727
Access Fund, Inc. 256,000 --
c/o Schott Foundation
678 Massachusetts Avenue
Cambridge, MA 02139
Facsimile: (617) 876-7702
</TABLE>
