SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. ___)*
McM CORPORATION
(Name of Issuer)
COMMON STOCK
(Title of class of securities)
552674103
(CUSIP NUMBER)
McM Acquisition Corporation
M. Roland Britt
1005 Wade Avenue
Raleigh, North Carolina 27605
Telephone No. 919-787-8837
(Name, address and telephone number of person authorized to
receive notices and communications)
Copy to:
William S. Patterson
Hunton & Williams
Post Office Box 109
Raleigh, North Carolina 27602
January 24, 1997
(Date of event which requires filing of this statement)
If the filing person has previously filed a statement
on Schedule 13G to report the acquisition which is the
subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4),
check the following box [ ].
Check the following box if a fee is being paid with
this statement [ X ].
Page 1 of 7 Pages
<PAGE>
CUSIP NO. 13D Page 2 of 7 Pages
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
McM Acquisition Corporation
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a)
(b) X
3 SEC USE ONLY
4 SOURCE OF FUNDS*
00 (option acquired in exchange for willingness to pursue
acquisition)
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
North Carolina
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
7 SOLE VOTING POWER
3,087,500 shares that McM Acquisition Corporation may acquire
pursuant to an option to purchase from the Wilmington Trust
Company, as Trustee for the McMillen Trust
8 SHARED VOTING POWER
9 SOLE DISPOSITIVE POWER
3,087,500 shares that McM Acquisition Corporation may acquire
pursuant to an option to purchase from the Wilmington Trust
Company, as Trustee for the McMillen Trust
10 SHARED DISPOSITIVE POWER
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
3,087,500
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
66%
14 TYPE OF REPORTING PERSON*
CO
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
CUSIP NO. 13D Page 3 of 7 Pages
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
M. Roland Britt
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a)
(b) X
3 SEC USE ONLY
4 SOURCE OF FUNDS*
00 (option acquired in exchange for willingness to pursue
acquisition)
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
7 SOLE VOTING POWER
3,087,500 shares that McM Acquisition Corporation may acquire
pursuant to an option to purchase from the Wilmington Trust
Company, as Trustee for the McMillen Trust
8 SHARED VOTING POWER
9 SOLE DISPOSITIVE POWER
3,087,500 shares that McM Acquisition Corporation may acquire
pursuant to an option to purchase from the Wilmington Trust
Company, as Trustee for the McMillen Trust
10 SHARED DISPOSITIVE POWER
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
3,087,500
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
66%
14 TYPE OF REPORTING PERSON*
IN
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
Item 1. Security and Issuer.
This statement relates to the Common Stock (the "Common
Stock") of McM Corporation (the "Issuer"), a North Carolina
corporation, having its principal executive offices at 702 Oberlin
Road, Raleigh, North Carolina 27605.
Item 2. Identity and Background.
McM Acquisition Corporation (the "Corporation") is a North
Carolina corporation formed on November 4, 1996, and it is not yet
engaged in business. The principal office of the Corporation is
located at 1005 Wade Avenue, Raleigh, North Carolina 27605.
M. Roland Britt is a citizen of the United States and is the
President and sole director and shareholder of the Corporation. His
business address is the same as that of the Corporation. He is a
private investor and real estate developer.
Neither M. Roland Britt nor the Corporation has been
convicted in any criminal proceeding in the last five years, nor
has either been, during the last five years, a party to
any civil proceeding of a judicial or administrative body of
competent jurisdiction, as a result of which proceedings either was
or is subject to a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities
subject to, federal or state securities laws or finding any
violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
This filing is made in connection with the acquisition of an
option to purchase for $6.20 per share the 3,087,500 shares of
Common Stock of the Issuer (the "Shares") currently held by the
Wilmington Trust Company as Trustee of the McMillen Trust (the
"Trustee"). This option (the "Option") was granted pursuant to a
First Amendment to Agreement dated January 24, 1997 (amending an
Agreement dated November 22, 1996). The Corporation has
not yet arranged for financing of any exercise of the Option, but
in connection with a possible acquisition of the Issuer or an
exercise of the Option, the Corporation expects to seek bank loans
and equity participation from parties not yet identified.
Item 4. Purpose of Transaction.
The option to purchase was obtained in connection with an
effort to acquire the Issuer. In order to encourage the
Corporation to continue with its due diligence investigation and
financing efforts with respect to such acquisition, the Trustee
agreed to give the Corporation the Option. The Corporation still
intends to pursue a merger pursuant to which all of the outstanding
Common Stock of the Issuer is exchanged for cash. If the
Corporation is unsuccessful in acquiring the Issuer by merger, the
Corporation reserves the right to pursue other methods of acquiring
control or otherwise influencing the Issuer.
Item 5. Interest in Securities of the Issuer.
(a) The Option is for 3,087,500 shares of Common Stock,
which represents 66% of the outstanding shares of Common Stock.
(b) The Corporation would acquire sole voting and
dispositive power for 3,087,500 shares of Common Stock upon
exercise of the Option.
(c) On January 24, 1997, the Corporation acquired the
Option. There have been no other transactions in the past 60 days.
(d) Not applicable.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities of the Issuer.
The Corporation and the Trustee have entered into the
Agreement and the First Amendment described in Section 4 above. In
addition, the Corporation and the Issuer have entered into a letter
agreement dated January 31, 1997 pursuant to which, among other
things, the Issuer has granted to the Corporation an Exclusive
Period during which the Issuer agreed not to solicit other
acquisition offers.
Item 7. Material to be Filed as Exhibits.
Agreement dated November 22, 1996 and Amendment dated
January 24, 1997 between the Corporation and the Trustee concerning
the Issuer, and Agreement between the Issuer and the Corporation
dated January 31, 1997.
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of his knowledge
and belief, the undersigned certify that the information set forth
in this statement is true, complete and correct.
Dated: February 3, 1997 /s/ M. Roland Britt
M. Roland Britt
McM Acquisition Corporation
By: /s/ M. Roland Britt
Name: M. Roland Britt
Title: President
<PAGE>
Exhibit Index
Exhibit 1 Agreement between McM Acquisition Corporation and M.
Roland Britt with respect to the filing of this form.
Exhibit 2 Agreement between Wilmington Trust Company as Trustee
of the McMillen Trust and McM Acquisition Corporation
dated November 22, 1996.
Exhibit 3 First Amendment to Agreement between Wilmington Trust
Company as Trustee of the McMillen Trust and McM
Acquisition Corporation dated January 24, 1997.
Exhibit 4 Letter agreement between McM Acquisition Corporation
and McM Corporation dated January 31, 1997.
EXHIBIT 1
We, the undersigned, hereby express our agreement that
the attached Schedule 13D is filed on behalf of each of the
undersigned.
Date: February 3, 1997
/s/ M. Roland Britt
M. Roland Britt
McM Acquisition Corporation
By: /s/ M. Roland Britt
Name: M. Roland Britt
Title: President
EXHIBIT 2
AGREEMENT
THIS AGREEMENT entered into this 22nd day of November, 1996,
by McM Acquisition Corporation, a North Carolina corporation with
its principal offices and place of business in Raleigh, North
Carolina ("MAC"), and the Wilmington Trust Company (solely in its
capacity as Trustee as described below) a Delaware corporation
with its principal offices and place of business in Wilmington,
Delaware (the "Trustee").
R E C I T A L S:
WHEREAS, the Trustee serves as trustee under a Trust
Agreement dated February 28, 1927, which was established for the
benefit of certain descendants of the McMillen family (the
"McMillen Trust"); and
WHEREAS, the McMillen Trust owns 3,087,500 shares of common
stock of McM Corporation, a publicly-traded, North Carolina
corporation operating as an insurance holding company under the
laws of North Carolina ("McM"); and
WHEREAS, the Trustee has been ordered by the Delaware
Chancery Court to sell its McM shares in order to diversify the
McMillen Trust assets; and
WHEREAS, MAC desires to acquire all, but not less than all,
of the outstanding stock of McM through a merger on the terms and
conditions described herein; and
WHEREAS, the Trustee desires that the Trust shares be
converted into cash pursuant to a merger on the terms and
conditions described herein.
NOW, THEREFORE, the parties agree as follows:
1. Proposal of Merger. MAC and the Trustee will present
a proposed plan of merger (the "Plan") to the McM Board of
Directors pursuant to which McM and MAC will merge (the
"Merger"). The Plan will contain, among other terms and
conditions, the following:
a. Consideration. Each share of McM stock will be
exchanged for a cash payment of $6.20.
b. Payment. Shareholders will receive the entire amount
of cash due them at the time the merger is consummated.
c. Conditions Precedent to Merger Closing. Consummation
of the merger will be subject to, among other things,
satisfaction of the following conditions precedent:
(i) adoption of a Plan of Merger by the McM
Board of Directors pursuant to N.C.G.S. Section 55-
11-01(a);
(ii) approval of the Plan of Merger by the
McM shareholders pursuant to N.C.G.S. Section 55-
11-03(b)(2);
(iii) approval of the proposed merger by
the North Carolina Commissioner of Insurance
pursuant to N.C.G.S. Section 58-19-15;
(iv) expiration of the notice period after
filing by McM and MAC under the Hart-Scott-
Rodino Act, 15 USC Section 18A;
(v) execution of employment agreements
between McM and George King, Stephen
Stephano, Michael Blinson, and Kevin Hamm,
having a term of employment with McM or its
corporate successor of at least three years
and being otherwise acceptable to MAC;
(vi) execution of employment agreements
between McM and Deborah Wrinkle, Jerry
Ferguson and Gene Barrett acceptable to MAC;
(vii) completion of due diligence
investigation with findings satisfactory to
MAC in its sole discretion;
(viii) completion of financing
arrangements and receipt of funds;
(ix) no material adverse change occurring in
the business of properties of McM;
(x) completion of all necessary governmental
filings and approvals, including but not
limited to filings with the United States
Securities and Exchange Commission; and
(xi) closing of the Merger by June 30, 1997
(unless waived by MAC).
2. Plan Adoption and Approval. The Trustee will use its
best efforts to have the Board of Directors adopt the Plan, to
obtain a favorable shareholder vote on the approval of the Plan
and to assist in satisfaction of any other conditions to the
consummation of the Merger. The Trustee also agrees that it will
vote its shares in a shareholder vote in favor of approval of the
Plan.
3. Third Party Negotiations. The Trustee agrees not to
solicit other offers for its McM stock and not to involve itself
in any discussions regarding the sale or transfer of its McM
shares with any party other than MAC. The obligation not to
solicit or consider offers from third parties or enter into
discussions with third parties shall be effective from the time
of execution of this Agreement until the earlier of the closing
of the Merger or June 30, 1997.
4. Termination Fee. Should the Trustee fail to fulfill
its obligations under this Agreement, the Trustee shall reimburse
expenses incurred by MAC or its affiliates in an amount not to
exceed $100,000 and shall pay MAC or its designee a cash amount
of $1,000,000.
5. The Trustee's Representations and Warranties. The
Trustee represents and warrants to MAC as follows:
(a) It is the owner, free and clear of any liens, claims
or encumbrances, of 3,087,500 shares of McM common stock and that
such shares comprise its entire beneficial and legal ownership of
McM.
(b) Except for approval of this Agreement by the Delaware
Chancery Court, the Trustee has full power and authority to
transfer its shares of McM stock and to otherwise fulfill its
duties and obligations set forth in this Agreement.
(c) To the best of its knowledge, all information provided
to MAC or its affiliates or representatives by the Trustee, the
agents and employees of the Trustee, and by the officers,
directors, employees and agents of McM Corporation are true,
correct and complete in every respect.
6. Survival of Representations. The parties have not
made any representation, warranty or covenant not set forth herein
and this Agreement constitutes the entire agreement between the
parties. All representations and warranties and agreements shall
survive the merger of McM into MAC.
7. Benefit. This Agreement shall inure to the benefit
of, and be binding upon, the Trustee and MAC and their respective
heirs, executors, administrators, successors and assigns.
8. Notice. Any notice, report or demand required or
permitted by any provision of this Agreement shall be deemed to
have been sufficiently given for all purposes if it is sent by
registered or certified mail, postage prepaid, addressed as
follows:
If to the Trustee:
Wilmington Trust Company
c/o Michael A. DiGregorio
Senior Trust Counsel
Rodney Square North
1100 N. Market Street
Wilmington, DE 19890-0001
If to MAC:
McM Acquisition Corporation
c/o William S. Patterson
Hunton & Williams
Post Office Box 109
Raleigh, North Carolina 27602-0109
9. Termination. MAC may terminate this Agreement upon
delivery of written notice to the Trustee of occurrence of either
of the following events:
(a) failure of the McM Board of Directors to adopt the
Plan within 15 days after the execution of this Agreement; or
(b) the closing of the Merger not occurring by June 30,
1997.
10. Construction. This Agreement has been executed in
the State of North Carolina and shall be construed in accordance
with the laws of North Carolina.
11. Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original,
but all of which shall constitute one and the same instrument.
12. Fees and Commissions. The Trustee has retained the
services of Paine Webber Incorporated to assist it in the
transactions herein contemplated. MAC has retained the services
of Scott & Stringfellow, Inc. to assist it in the transactions
herein contemplated. The Trustee is solely liable for any fees
and commissions due Paine Webber Incorporated and MAC is solely
liable for any fees and commissions due Scott & Stringfellow,
Inc. The Trustee and MAC agree to indemnify and hold each other
harmless from and against any loss, liability or damage,
including expenses, arising out of any claim for any commission,
fee or charge arising by reason of services alleged to have been
rendered at the request or with the knowledge of the indemnifying
party.
13. Actions Necessary to Complete Transaction. Each party
hereby agrees to execute and deliver all such other documents or
instruments and to take any action that may be reasonably
required in order to effectuate the transaction contemplated by
this Agreement.
14. Waiver. Any waiver by either party of any breach of
any term or condition of this Agreement shall not be deemed a
waiver of any other breach of such term or condition, nor shall
the failure of either party to enforce any provision constitute a
waiver of such provision or any other provision, nor shall such
action be deemed a waiver or release of any party for any claims
arising out of or connected with this Agreement.
<PAGE>
IN WITNESS WHEREOF, the parties have duly executed this
Agreement on the date first above written.
McMILLEN TRUST
Wilmington Trust Company as Trustee
By:
Title:
McM ACQUISITION CORPORATION
By: /s/ M. Roland Britt
M. Roland Britt, President
EXHIBIT 3
FIRST AMENDMENT TO AGREEMENT BETWEEN
McM ACQUISITION CORPORATION AND THE WILMINGTON TRUST COMPANY
THIS FIRST AMENDMENT TO AGREEMENT is entered into this 24th
day of January, 1997, by McM Acquisition Corporation, a North
Carolina corporation with its principal offices and place of
business in Raleigh, North Carolina ("MAC") and the Wilmington
Trust Company (solely in its capacity as Trustee of the McMillen
Trust), a Delaware corporation with its principal offices and
place of business in Wilmington, Delaware (the "Trustee").
R E C I T A L S:
WHEREAS, the parties entered into an Agreement dated
November 22, 1996 (the "Agreement") concerning the stock of McM
Corporation ("McM"); and
WHEREAS, representatives of MAC have met with McM and,
pursuant to Section 1 of the Agreement and together with the
Trustee, presented a draft Agreement of Merger between McM and
MAC to the Board of Directors of McM; and
WHEREAS, the McM Board has declined to agree to enter into
the proposed Agreement of Merger, citing certain closing
conditions contained therein; and
WHEREAS, the Trust wants MAC to continue to do its due
diligence investigation and analysis of possible financing in
connection with the transaction contemplated by the Agreement;
and
WHEREAS, MAC is unwilling to undertake its additional due
diligence investigation and financing investigations without
further assurances from the Trustee concerning the shares of McM
stock held by the Trustee.
NOW, THEREFORE, in consideration of the premises, the
Agreement, the mutual covenants contained herein, and other
valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties agree as follows:
1. Conditions Precedent. Section 1(c)(xi) is hereby
amended so that the reference to "June 30, 1997" is changed to
"March 1, 1998".
2. Plan Adoption and Approval. Section 2 of the
Agreement is hereby amended so as to add the following sentence at
the end:
"The Trustee further agrees that in the event of a
tender offer for the common stock of McM made by MAC
for cash consideration greater than or equal to $6.20
per share, the Trustee will tender its shares to MAC."
3. Third Party Negotiations. The first sentence of
Section 3 of the Agreement is hereby amended and restated as
follows:
"The Trustee agrees not to solicit other offers for its
McM stock, not to involve itself in any discussions
regarding the sale or transfer of its McM stock with
any party other than MAC, not to vote its shares in
favor of any merger, consolidation or share exchange
involving McM other than the Merger, and not to sell
any of its shares of McM stock to any third party prior
to expiration of the Option Period (as defined below)."
Section 3 of the Agreement is hereby amended so that the
reference to "June 30, 1997" is changed to "March 1, 1998".
4. The Trustee's Representations and Warranties. Section
5(b) of the Agreement is amended by deleting the phrase "Except
for approval of this Agreement by the Delaware Chancery Court."
The Trustee hereby reconfirms the representations and warranties
in Section 5 of the Agreement as of the date hereof.
5. Termination. Section 9(a) of the Agreement is hereby
amended and restated as follows: "Failure of the McM Board of
Directors to adopt the Plan during the Option Period." Section
9(b) of the Agreement is hereby amended so that the reference to
"June 30, 1997" is changed to "March 1, 1998".
6. Fees and Commissions. Section 12 of the Agreement is
amended to add the words "Berwind Corporation" after both
references to "PaineWebber, Incorporated."
7. Option to Purchase Shares. The Trustee hereby grants
to MAC an option to purchase all of its shares of common stock of
McM at any time prior to March 1, 1998 (the "Option Period").
The exercise price under the option will be $6.20 per share. The
Option may be exercised on three days written notice from MAC to
the Trustee specifying its intent to exercise the Option and the
time and place of closing. Payment for the shares will be by
certified check or wire transfer. The Trustee shall deliver
certificates representing the shares, duly endorsed by the
Trustee, to MAC.
The option granted in this Section shall apply to the shares
of McM common stock now held by the Trustee, any shares or voting
securities which may be substituted therefor by reason of any
recapitalization, reorganization, merger or consolidation of McM,
and any shares issued as a share dividend. In the event of any
such recapitalization, reorganization, merger, consolidation or
share dividend, the option price will be equitably adjusted.
8. No Further Amendment. Except as expressly provided
herein, the Agreement remains in full force and effect.
9. Capitalized Terms. Capitalized terms used but not
defined herein shall have the meanings given them in the
Agreement.
IN WITNESS WHEREOF, the parties have executed this First
Amendment to Agreement as of the date first above written.
McMILLEN TRUST
Wilmington Trust Company as Trustee
By:
Title:
McM ACQUISITION CORPORATION
By: /s/ M. Roland Britt
M. Roland Britt, President
EXHIBIT 4
McM ACQUISITION CORPORATION
1005 Wade Avenue
Raleigh, North Carolina 27605
(919) 676-6397
January 31, 1997
Private and Confidential
Mr. George E. King
Chairman Emeritus
Chief Executive Officer
McM Corporation
Post Office Box 12317
Raleigh, North Carolina 27605
Re: Review of McM Corporation Matters
Dear Mr. King:
Following our various discussions, we propose the following
procedure for our newly formed entity, McM Acquisition Corporation
("MAC"), in completing a confidential review of the financial
condition and operations of McM Corporation ("McM") and the
finalization of funding arrangements, including commitment letters
from established financial institutions, with the intention or
purpose of making an offer to acquire all of the shares of McM.
Before MAC proceeds further with its due diligence and
financing efforts, it requires that McM grant an exclusive period
of time (the "Exclusive Period") during which MAC can carry out its
activities in a deliberate, confidential and appropriate manner
without fear of wasting the time and effort necessary to complete
such activities. The Exclusive Period shall begin on the day that
this letter agreement is signed on behalf of McM and shall continue
for 120 days.
Except as set forth herein, during the Exclusive Period McM
shall not, nor shall McM authorize or permit any of its affiliates,
officers, directors, employees, representatives or agents to,
directly or indirectly, encourage, solicit or initiate discussions
or negotiations with any third party with respect to any proposal
to acquire McM or any McM subsidiary or 10% or more of McM's total
assets or of McM's insurance in-force or of the outstanding
shares of McM or of any McM subsidiary. McM may, directly or
indirectly, furnish information and access, in response to
unsolicited requests therefor, to any third party pursuant to
written confidentiality agreements, and may participate in
discussions and negotiate with such person concerning an
acquisition proposal, if McM determines in its good faith judgment
that it is required to do so in order to comply with its legal or
fiduciary duties.
MAC will undertake its final due diligence review of the
current operating, financial and business position of McM and each
of its subsidiaries. In connection with such review, you will use
your best efforts to provide MAC access to the financial
statements, actuarial records, reinsurance treaties and financial
books and records of the McM Group as MAC may reasonably request
from time to time.
Simultaneously with our due diligence review, we will
proceed to complete the necessary arrangements with financial
institutions and equity participants to the extent that
commitment letters can be presented to McM to establish our clear
and present capacity to comply with the financial requirements of
any proposed acquisition.
McM will cause such senior executives, financial personnel
and professional advisors as McM may reasonably designate from time
to time to confer with MAC designees and third parties (both at
McM's offices and elsewhere) and to disclose, explain and clarify
such information relating to the business, operations and
investments of McM as MAC may reasonably request.
If this procedure is acceptable to you, please sign and
return the enclosed copy of this letter to indicate your
acceptance, and have it signed by PaineWebber.
Sincerely,
/s/ M. Roland Britt
M. Roland Britt
President
Accepted and Agreed: Acknowledged:
McM CORPORATION PAINEWEBBER
INCORPORATED
By: By:
Title: Title:
Date: Date:
