EXHIBIT 2
STOCKHOLDER AGREEMENT
AGREEMENT, dated as of October 27, 2000 among REH Mergersub Inc.,
a Delaware corporation ("Purchaser"), Reed Elsevier Inc., a Massachusetts
corporation ("Parent") and each of the other parties signatory hereto (each a
"Stockholder" and collectively the "Stockholders").
WHEREAS, Parent, Purchaser and Harcourt General, Inc. (the "Company")
have entered into an Agreement and Plan of Merger, dated as of the date hereof
(the "Merger Agreement"; terms defined in the Merger Agreement and not
otherwise defined herein being used herein as therein defined), pursuant to
which, among other things, the Purchaser will make the Offer and, after
consummation thereof, merge with and into the Company (the "Merger") and each
issued and outstanding share (other than shares cancelled pursuant to Section
2.6(c) of the Merger Agreement, Dissenting Shares and shares owned by the
Company, Parent or Purchaser) of (i) Company Common Stock will be converted
into the Common Stock Merger Consideration and (ii) Series A Stock will be
converted into the Series A Stock Merger Consideration.
WHEREAS, as of October 20, 2000 the Stockholders owned of record and
beneficially 19,955,998 shares (and each Stockholder owned the number of such
shares set forth beside such Stockholder's name on the signature page hereto)
of Class B Stock (such Class B Stock, together with any (A) other Class B Stock
acquired by any Stockholder by purchase or otherwise and (B) Company Common
Stock acquired by any Stockholder by conversion of Class B Stock, in each case
from October 20, 2000 through the term of this Agreement, are collectively
referred to herein as the Stockholders' "Subject Shares").
WHEREAS, as a condition and inducement to Parent's and Purchaser's
willingness to enter into the Merger Agreement, Parent has requested that the
Stockholders agree, and each of the Stockholders has agreed, to enter into this
Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
<PAGE>
ARTICLE 1
VOTING AGREEMENT; GRANT OF PROXY; AGREEMENT TO TENDER
SECTION 1.01. Voting Agreement; Conversion of Class B Stock. (a) Each
Stockholder hereby agrees to vote all Subject Shares that such Stockholder is
entitled to vote at the time of any vote to approve and adopt the Merger
Agreement and the Merger at any meeting of the stockholders of the Company, and
at any adjournment thereof, at which the Merger Agreement (or any amended
version thereof) and the Merger are submitted for the consideration and vote of
the stockholders of the Company.
(b) Without limiting the generality of the foregoing, (i) each
Stockholder hereby agrees to approve and to take all actions necessary, proper
or advisable to effect (including, in the case of clause (B) below, calling and
holding a special meeting of the holders of Class B Stock to the extent
required under the Company's Restated Certificate, By-Laws or applicable laws)
the conversion of all of the Class B Stock into Common Stock pursuant to (A)
Article Fourth, Section 4(a) of the Company's Restated Certificate or (B) in
the event any Stockholder fails to perform its obligations under this Agreement
to effect a conversion in accordance with clause (A) before the expiration of
the Offer, under Article Fourth, Section 3(e) of the Company's Restated
Certificate (such conversion of all the Class B Stock pursuant to either clause
(A) or (B) being referred to hereinafter as a "Class B Conversion") immediately
upon request by Parent or Purchaser; provided that in no event will any
Stockholder be required to effect the Class B Conversion until immediately
prior to the expiration of the Offer and after Parent and Purchaser shall have
delivered an irrevocable binding notice to the Stockholders and the Company
that each of the Offer Conditions have been satisfied (or would be satisfied,
in the case of the Minimum Condition, upon the Class B Conversion and the
tender of the Subject Shares issuable upon such conversion) or waived in
accordance with the Merger Agreement together with a certificate of the
depositary of the Offer setting forth the number of shares of Company Common
Stock validly tendered and not withdrawn in the Offer as immediately prior to
such time as practicable and (ii) no Stockholder shall approve, nor take any
action that would result in, a Class B Conversion except in accordance with the
preceding sentence.
(c) Each Stockholder hereby agrees that it shall vote its Subject
Shares against the approval of (i) any Acquisition Proposal, (ii) any
extraordinary dividend or distribution by the Company or any Subsidiary, (iii)
any change in the capital structure of the Company or any Subsidiary (other
than pursuant to the Merger Agreement) and (iv) any other action that would
reasonably be expected to, in any material respect, prevent, impede, interfere
with, delay, postpone,
<PAGE>
frustrate the purposes of or attempt to discourage the transactions
contemplated by the Merger Agreement.
(d) Each Stockholder hereby agrees that any agreements among the
Stockholders or any of them which could be construed to limit their respective
rights to enter into this Agreement or perform hereunder are amended to the
full extent necessary to assure that entering into this Agreement and
performance hereunder are permitted under each such agreement without breach
thereof.
SECTION 1.02. Irrevocable Proxy. Each Stockholder hereby irrevocably
and unconditionally revokes any and all previous proxies granted with respect
to its Subject Shares. By entering into this Agreement, each Stockholder hereby
irrevocably and unconditionally grants a proxy appointing Purchaser as such
Stockholder's attorney-in-fact and proxy, with full power of substitution, for
and in such Stockholder's name, to vote, express, consent or dissent, or
otherwise to utilize such voting power in the manner contemplated by Section
1.01 as Purchaser or its proxy or substitute shall, in Purchaser's sole
discretion, deem proper with respect to such Stockholder's Subject Shares. The
proxy granted by such Stockholder pursuant to this Article 1 is coupled with an
interest and is irrevocable and is granted in consideration of Parent and
Purchaser entering into this Agreement and the Merger Agreement and incurring
certain related fees and expenses. Each Stockholder shall perform such further
acts and execute such further documents as may be required to vest in Purchaser
the sole power to vote such Stockholder's Subject Shares. Notwithstanding the
foregoing, the proxy granted by each Stockholder shall be revoked upon
termination of this Agreement in accordance with its terms.
SECTION 1.03. Agreement to Tender. Immediately after the Class B
Conversion has occurred and prior to the expiration of the Offer, subject to
Section 1.01, each Stockholder hereby agrees to validly tender and sell (or
cause the record owner of such shares to validly tender and sell) and not
withdraw, promptly upon the request of Parent or Purchaser, all of its Subject
Shares pursuant to and in accordance with the terms of the Offer. Immediately
after the Class B Conversion has occurred and prior to the expiration of the
Offer, subject to Section 1.01, each Stockholder shall deliver to the
depositary designated in the Offer (i) a letter of transmittal with respect to
its Subject Shares complying with the terms of the Offer, (ii) certificates
representing such Subject Shares and (iii) all other documents or instruments
required to be delivered pursuant to the terms of the Offer.
<PAGE>
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF STOCKHOLDERS
Each Stockholder, severally and not jointly, represents and warrants
to Parent and Purchaser that:
SECTION 2.01. Authorization. (a) If such Stockholder is not an
individual, the execution, delivery and performance by such Stockholder of this
Agreement and the consummation by such Stockholder of the transactions
contemplated hereby are within the corporate or similar powers of Stockholder
and have been duly authorized by all necessary corporate or similar action.
This Agreement constitutes a valid and binding Agreement of such Stockholder.
(b) If such Stockholder is married and the Subject Shares set forth on
the signature page hereto opposite such Stockholder's name constitute community
property under applicable laws, this Agreement has been duly authorized,
executed and delivered by, and constitutes the valid and binding agreement of,
such Stockholder's spouse. If this Agreement is being executed in a
representative or fiduciary capacity, the Person signing this Agreement has
full power and authority to enter into and perform this Agreement
SECTION 2.02. Non-Contravention. If such Stockholder is not an
individual, the execution, delivery and performance by such Stockholder of this
Agreement and the consummation by such Stockholder of the transactions
contemplated hereby do not and shall not (i) violate any organizational
documents of such Stockholder, (ii) violate any applicable law, rule,
regulation, judgment, injunction, order or decree, (iii) require any consent or
other action by any Person under, constitute a default under, or give rise to
any right of termination, cancellation or acceleration or to a loss of any
benefit to which such Stockholder is entitled under any provision of any
agreement or other instrument binding on such Stockholder (iv) result in the
imposition of any Lien on any asset of Stockholder or (v) violate any other
agreement, arrangement or instrument to which such Stockholder is a party or by
which such Stockholder (or any of its assets) is bound.
SECTION 2.03. Ownership of Subject Shares. Such Stockholder is the
record and beneficial owner of the Subject Shares, free and clear of any Lien
and any other limitation or restriction (including any restriction on the right
to vote or otherwise dispose of the Subject Shares) (other than (i) with
respect to the Subject Shares subject to the Pledge Agreements (as defined in
Exhibit A) only (the "Pledged Shares"), any limitations or restrictions under
such Pledge Agreements and (ii) those which would not impede in any manner such
Stockholder's ability to perform this Agreement; provided that, for the
avoidance of doubt, any
<PAGE>
limitation or restriction on such Stockholder's right to transfer or vote such
Stockholder's Subject Shares shall be deemed to materially impede such
Stockholder's ability to perform this Agreement). None of the Subject Shares is
subject to any voting trust or other agreement, arrangement or instrument with
respect to the voting of such shares.
SECTION 2.04. Pledged Shares. If such Stockholder is a holder of
Pledged Shares, that (i) there are no facts, events, conditions, situations or
set of circumstances which would reasonably be expected to result in or be the
basis for an event of default under the terms of either of the Pledge
Agreements and (ii) to such Stockholder's knowledge, there are no facts,
events, conditions, situations or set of circumstances which would reasonably
be expected to result in or be the basis for an event of default under the
terms of the Loan Agreements (as defined in Exhibit A).
SECTION 2.05. Total Subject Shares. Except for the Subject Shares set
forth beside such Stockholder's name on the signature page hereto or any
beneficial interest in Subject Shares that are set forth beside another
Stockholder's name on the signature page hereto and except for the Company
Common Stock and Options referred to in the immediately following sentence,
such Stockholder does not beneficially own any (i) Subject Shares of capital
stock or voting securities of the Company, (ii) securities of the Company
convertible into or exchangeable for Subject Shares of capital stock or voting
securities of the Company or (iii) options or other rights to acquire from the
Company any capital stock, voting securities or securities convertible into or
exchangeable for capital stock or voting securities of the Company. The
Stockholders beneficially own a number of shares of Company Common Stock,
including shares issuable upon exercise of Options, not exceeding in the
aggregate one million shares (excluding any Subject Shares).
SECTION 2.06. Finder's Fees. No investment banker, broker, finder or
other intermediary is entitled to a fee or commission from Parent, Purchaser or
the Company in respect of this Agreement based upon any arrangement or
agreement made by or on behalf of such Stockholder.
SECTION 2.07. Reliance by Parent and Purchaser. Such Stockholder
understands and acknowledges that Parent and Purchaser is entering into the
Merger Agreement in reliance upon such Stockholder's execution and delivery of
this Agreement.
<PAGE>
ARTICLE 3
COVENANTS OF STOCKHOLDERS
Each Stockholder hereby covenants and agrees that:
SECTION 3.01. No Interference; No Transfers. Except pursuant to the
terms of this Agreement, such Stockholder shall not, without the prior written
consent of Parent or Purchaser, directly or indirectly, (i) grant any proxies
or enter into any voting trust or other agreement or arrangement with respect
to the voting of any Subject Shares in a manner inconsistent with the terms of
this Agreement, (ii) voluntarily take any action that would or is reasonably
likely to (A) make any representation or warranty contained herein untrue or
incorrect in any material respect or (B) have the effect in any material
respect of preventing such Stockholder from performing its obligations under
this Agreement or (iii) voluntarily sell, assign, transfer, encumber or
otherwise dispose of, or enter into any contract, option or other arrangement
or understanding with respect to the direct or indirect sale, assignment,
transfer, encumbrance or other disposition of, any Subject Shares during the
term of this Agreement except for transfers (i) to any person or entity who is
subject to this Agreement or who becomes bound hereby as a Stockholder by
operation of law or by becoming party to and being bound by the terms of this
Agreement as a Stockholder incident to such transfer or (ii) to charitable
organizations of Company Common Stock converted from Class B Stock provided
such Company Common Stock constitutes, in the aggregate (including all shares
so transferred to charitable organizations by all Stockholders from the date
hereof), not more than 100,000 shares of the outstanding Company Common Stock.
For purposes of this Section 3.01, the term "sell" or "sale" or any derivatives
thereof shall include (i) a sale, transfer or disposition of record or
beneficial ownership, or both and (ii) a short sale with respect to Company
Common Stock or substantially identical property, entering into or acquiring an
offsetting derivative contract with respect to Company Common Stock or
substantially identical property, entering into or acquiring a futures or
forward contract to deliver Company Common Stock or substantially identical
property or entering into any transaction that has the same effect as any of
the foregoing.
SECTION 3.02. Other Offers. Such Stockholder shall not, directly or
indirectly, (i) take any action to solicit or initiate any Acquisition Proposal
or (ii) engage in negotiations with, or disclose any nonpublic information
relating to the Company or any of its Subsidiaries or afford access to the
properties, books or records of the Company or any of its Subsidiaries to, any
Person that may be considering making, or has made, an Acquisition Proposal or
has agreed to endorse an Acquisition Proposal. Such Stockholder shall promptly
notify Parent and Purchaser after receipt of an Acquisition Proposal or any
request for nonpublic information relating to the Company or any of its
Subsidiaries or for
<PAGE>
access to the properties, books or records of the Company or any of its
Subsidiaries by any Person that may be considering making, or has made, an
Acquisition Proposal and shall advise Purchaser of the status and material
details of any such Acquisition Proposal or request.
SECTION 3.03. Appraisal Rights. Such Stockholder shall not exercise
any rights (including, without limitation, under Section 262 of the General
Corporation Law of the State of Delaware) to demand appraisal of any Subject
Shares which may arise with respect to the Merger.
SECTION 3.04. Pledged Shares. Each of the Stockholders of the Pledged
Shares agrees that it will use its reasonable efforts to cause the lenders
described in Exhibit A to agree to become party to this Agreement so that such
lenders will be bound by the terms and conditions of this Agreement upon an
event of default or upon the lenders otherwise becoming entitled to exercise
their rights in respect of the Pledged Shares under either of the Pledge
Agreements or the Loan Agreements; provided that such Stockholder's efforts
pursuant to this Section 3.04 shall not require such Stockholder to offer or
grant any financial accommodations to such lenders.
SECTION 3.05. Further Assurances. Parent, Purchaser and Stockholder
shall each execute and deliver, or cause to be executed and delivered, all
further documents and instruments and use its reasonable best efforts to take,
or cause to be taken, all actions and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws and regulations, to
consummate and make effective the transactions contemplated by this Agreement.
ARTICLE 4
MISCELLANEOUS
SECTION 4.01. Amendments; Termination. Any provision of this Agreement
may be amended or waived if, but only if, such amendment or waiver is in
writing and is signed, in the case of an amendment, by each party to this
Agreement or in the case of a waiver, by the party against whom the waiver is
to be effective. This Agreement shall terminate on the earlier of (i) the
Effective Time and (ii) the date of termination of the Merger Agreement in
accordance with its terms; provided that this Article 4 shall survive any such
termination.
SECTION 4.02. Expenses. All costs and expenses incurred in connection
with this Agreement shall be paid by the party incurring such cost or expense.
<PAGE>
SECTION 4.03. Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; provided that no party may assign, delegate
or otherwise transfer any of its rights or obligations under this Agreement
without the consent of the other parties hereto, except that each of Parent and
Purchaser may transfer or assign its rights and obligations to any Affiliate of
Parent; provided further that no such transfer or assignment shall relieve
Parent or Purchaser of its obligations hereunder.
SECTION 4.04. Governing Law. This Agreement shall construed in
accordance with and governed by the laws of the State of Delaware.
SECTION 4.05. Counterparts; Effectiveness. This Agreement may be
signed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each party hereto shall
have received counterparts hereof signed by all of the other parties hereto.
SECTION 4.06. Severability. If any term, provision or covenant of this
Agreement is held by a court of competent jurisdiction or other authority to be
invalid, void or unenforceable, the remainder of the terms, provisions and
covenants of this Agreement shall remain in full force and effect and shall in
no way be affected, impaired or invalidated.
SECTION 4.07. Interpretation. The headings contained in this Agreement
are for convenience of reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement. Whenever the words "include,"
"includes," or "including" are used in this Agreement, they shall be deemed to
be followed by the words "without limitation." Other than Section 1.01(d), this
Agreement is an agreement between each of the Stockholders, on the one hand,
and the Parent and Purchaser, on the other hand, and is not an agreement among
the Stockholders.
SECTION 4.08. Specific Performance. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement is
not performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof in addition to any other
remedy to which they are entitled at law or in equity.
SECTION 4.09. Acknowledgment. Each of Parent and Purchaser
acknowledges that (i) each Stockholder signs solely in its capacity as the
record and/or beneficial (as applicable) owner of the Subject Shares and
nothing herein shall limit or affect any actions taken by such Stockholder, or
require such
<PAGE>
Stockholder to take any action, in his or her capacity as an officer or
director of the Company including to disclose information acquired solely in
his or her capacity as an officer or director, (ii) if the event of default
referred to in Exhibit A occurs and the lenders require proxies or otherwise
exercise their rights to exercise voting powers over the Pledged Shares, or
sell the Pledged Shares, and as a result the Stockholders owning the Pledged
Shares are unable to comply with the obligations and covenants as set forth in
Article 1 of this Agreement, such noncompliance shall not constitute a breach
of this Agreement and (iii) pursuant to Section 3 of the Family Agreement,
certain of the Stockholders are required to sell to the Company certain of
their Subject Shares and such sale shall not constitute a breach of any of the
terms of this Agreement; provided that (A) such sale takes place immediately
prior to the expiration of the Offer, (B) prior to such sale the Subject Shares
are first converted into Company Common Stock and (C) such sale is otherwise in
accordance with the terms and conditions of Section 3 of the Family Agreement.
SECTION 4.10. Merger Agreement. (a) (i) The material terms of the
Merger Agreement shall not be changed, by amendment or waiver, in a manner
materially adverse to the Stockholders without the prior written consent of
Stockholders holding a majority of the Subject Shares and (ii) the obligations
of the Stockholders hereunder are subject to there not having been any change,
by amendment or waiver, by any party to the Merger Agreement to the material
terms of the Merger Agreement in a manner materially adverse to the
Stockholders without the prior written consent of Stockholders holding a
majority of the Subject Shares. For purposes of this Section 4.10(a), each of
the following changes, by amendment or waiver (as applicable), in the following
terms and conditions of the Offer which require the Company's consent shall,
without excluding other possibilities, be deemed to be a change to the material
terms of the Merger Agreement in a manner materially adverse to the
Stockholders: (A) a waiver by Purchaser of the Minimum Condition; (B) a change
in the Outside Date; (C) a change which decreases the price per Share payable
in the Offer; (D) a change to the form of consideration payable in the Offer
(other than by adding consideration); (E) a reduction in the maximum number of
Shares to be purchased in the Offer and (F) an imposition of any condition to
the Offer in addition to those set forth in the Merger Agreement.
(b) Parent and Purchaser hereby agree to pay for all shares tendered
by the Stockholders in accordance with the terms of the Offer.
SECTION 4.11. Performance by Parent and Purchaser. Whenever this
Agreement requires Parent or Purchaser to take any action, such requirement
shall be deemed to include an undertaking of Reed Elsevier plc to cause Parent
and Purchaser, as applicable, to take such action.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
REED ELSEVIER INC.
By: /s/ Henry Z. Horbaczewski
--------------------------
Name: Henry Z. Horbaczewski
Title: Senior Vice President
REH MERGERSUB INC.
By: /s/ Henry Z. Horbaczewski
--------------------------
Name: Henry Z. Horbaczewski
Title: Vice President
<PAGE>
Subject Shares
Class of Stock Owned STOCKHOLDERS
-------------- -------------- ------------
Class B 200,960 /s/ Richard A. Smith
--------------------
Richard A. Smith
Class B 256,827 /s/ Susan F. Smith
--------------------
Susan F. Smith
Class B 1,345,502 /s/ Nancy L. Marks
--------------------
Nancy L. Marks
Class B 629,840 SMITH MANAGEMENT COMPANY LLC*
SMITH MANAGEMENT COMPANY
TRUST, SOLE MEMBER
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, Trustee
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, Trustee
*Successor by merger to Smith
Management Company; record
ownership in the name of
Smith Management Company
1 As of October 20, 2000, the Stockholder owned an additional 610,000
shares which were substantially converted to Common Stock and transferred to
the Richard and Susan Smith Family Foundation, described below.
2 As of October 20, 2000, the Stockholder owned an additional 805,000
shares which were substantially converted to Common Stock and transferred to
the Richard and Susan Smith Family Foundation, described below.
3 As of October 20, 2000, the Stockholder owned an additional 443,818
shares which were substantially converted to Common Stock and transferred to
the Richard and Susan Smith Family Foundation, described below.
<PAGE>
Class B 288,720 MARIAN REALTY COMPANY LLC*
MARIAN REALTY COMPANY TRUST,
SOLE MEMBER
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, Trustee
By: /s/ Nancy L. Marks
-------------------------
Nancy L. Marks, Trustee
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, Trustee
*Successor by merger to
Marian Realty Company; record
ownership in the name of
Marian Realty Company
Class B 441,595 SUSAN F. SMITH GRANTOR
RETAINED ANNUITY TRUST - 15
YEARS
By: /s/ Susan F. Smith
-------------------------
Susan F. Smith, as Trustee
and not individually
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
Class B 224,189 SUSAN F. SMITH GRANTOR
RETAINED ANNUITY TRUST - 7
YEARS
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
<PAGE>
Class B 318,005 SUSAN F. SMITH GRANTOR
RETAINED ANNUITY TRUST - 5
YEARS
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
Class B 376,182 NANCY LURIE MARKS GRANTOR
RETAINED ANNUITY TRUST
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
Class B 378,875 AMY SMITH BERYLSON GRANTOR
RETAINED ANNUITY TRUST
By: /s/ Amy Smith Berylson
--------------------------
Amy Smith Berylson, as
Trustee and not
individually
By: /s/ John G. Berylson
--------------------------
John G. Berylson, as
Trustee and not
individually
Class B 128,906 AMY SMITH BERYLSON 1998
GRANTOR RETAINED ANNUITY
TRUST
By: /s/ John G. Berylson
-------------------------
John G. Berylson, as
Trustee and not
individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
<PAGE>
Class B 400,000 AMY SMITH BERYLSON 2000
GRANTOR RETAINED ANNUITY
TRUST
By: /s/ John G. Berylson
-------------------------
John G. Berylson, as
Trustee and not
individually
By: /s/ Mark D. Balk
--------------------------
Mark D. Balk, as Trustee
and not individually
Class B 10,295 J-J-E 1988 TRUST f/b/o
JENNIFER L. BERYLSON U/D/T
dated 11/1/88
By: /s/ John G. Berylson
--------------------------
John G. Berylson, as
Trustee and not
individually
By: /s/ Mark D. Balk
--------------------------
Mark D. Balk, as Trustee
and not individually
Class B 10,295 J-J-E 1988 TRUST f/b/o
ELIZABETH s. BERYLSON U/D/T
dated 11/1/88
By: /s/ John G. Berylson
-------------------------
John G. Berylson, as
Trustee and not
individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
<PAGE>
Class B 10,295 J-J-E 1988 TRUST f/b/o JAMES
T. BERYLSON U/D/T dated
11/1/88
By: /s/ John G. Berylson
-------------------------
John G. Berylson, as
Trustee and not
individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
Class B 372,438 ROBERT A. SMITH GRANTOR
RETAINED ANNUITY TRUST
By: /s/ Robert A. Smith
-------------------------
Robert A. Smith, as
Trustee and not
individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
Class B 114,966 ROBERT A. SMITH 2000 GRANTOR
RETAINED ANNUITY TRUST
By: /s/ Dana A. Weiss
-------------------------
Dana A. Weiss, as Trustee
and not individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
<PAGE>
Class B 400,000 ROBERT A. SMITH 2000 GRANTOR
RETAINED ANNUITY TRUST
By: /s/ Dana A. Weiss
-------------------------
Dana A. Weiss, as Trustee
and not individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
Class B 8,185 ROBERT SMITH AND DANA WEISS
1994 CHILDREN'S TRUST f/b/o
MADELINE W. SMITH U/D/T dated
12/1/94
By: /s/ Dana A. Weiss
-------------------------
Dana A. Weiss, as Trustee
and not individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
Class B 8,185 ROBERT SMITH AND DANA WEISS
1994 CHILDREN'S TRUST f/b/o
RYAN A. SMITH U/D/T dated
12/1/94
By: /s/ Dana A. Weiss
-------------------------
Dana A. Weiss, as Trustee
and not individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
<PAGE>
Class B 260,633 DEBRA A. SMITH GRANTOR
RETAINED ANNUITY TRUST
By: /s/ Debra Smith
-------------------------
Debra Smith, as Trustee
and not individually
By: /s/ Brian J. Knez
-------------------------
Brian J. Knez, as Trustee
and not individually
Class B 113,485 DEBRA SMITH KNEZ 1998 GRANTOR
ANNUITY TRUST
By: /s/ Brian J. Knez
-------------------------
Brian J. Knez, as Trustee
and not individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
Class B 400,000 DEBRA SMITH KNEZ 2000 GRANTOR
RETAINED ANNUITY TRUST
By: /s/ Brian J. Knez
-------------------------
Brian J. Knez, as Trustee
and not individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
<PAGE>
Class B 13,025 DEBRA AND BRIAN KNEZ 1988
CHILDREN'S TRUST f/b/o
JESSICA M. KNEZ U/D/T dated
11/1/88
By: /s/ Brian J. Knez
-------------------------
Brian J. Knez, as Trustee
and not individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
Class B 13,025 DEBRA AND BRIAN KNEZ 1988
CHILDREN'S TRUST f/b/o ANDREW
P. KNEZ U/D/T dated 11/1/88
By: /s/ Brian J. Knez
-------------------------
Brian J. Knez, as Trustee
and not individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
Class B 3,233,104 TRUST U/W/O PHILIP SMITH
f/b/o RICHARD A. SMITH
By: /s/ Brian J. Knez
-------------------------
Brian J. Knez, as Trustee
and not individually
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
<PAGE>
Class B 3,233,104 TRUST U/W/O PHILIP SMITH
f/b/o NANCY L. MARKS
By: /s/ Nancy L. Marks
-------------------------
Nancy L. Marks, as Trustee
and not individually
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
Class B 166,067 A-D-R TRUST f/b/o DEBRA SMITH
KNEZ U/I/T dated 2/9/67
By: /s/ Susan F. Smith
-------------------------
Susan F. Smith, a/k/a
Susan M. Smith, as Trustee
and not individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
Class B 610,000 C-J-P TRUST f/b/o CATHY LURIE
U/I/T dated 12/10/73
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
Class B 610,000 C-J-P TRUST f/b/o PETER LURIE
U/I/T dated 12/10/73
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
<PAGE>
Class B 80,000 RICHARD A. SMITH 1976 TRUST
f/b/o AMY SMITH BERYLSON
U/D/T dated 12/16/76
By: /s/ Susan F. Smith
-------------------------
Susan F. Smith a/k/a Susan
M. Smith, as Trustee and
not individually
Class B 240,000 RICHARD A. SMITH 1976 TRUST
f/b/o DEBRA SMITH KNEZ U/D/T
dated 12/16/76
By: /s/ Susan F. Smith
-------------------------
Susan F. Smith a/k/a Susan
M. Smith, as Trustee and
not individually
Class B 240,000 RICHARD A. SMITH 1976 TRUST
f/b/o ROBERT A. SMITH U/D/T
dated 12/16/76
By: /s/ Susan F. Smith
-------------------------
Susan F. Smith a/k/a Susan
M. Smith, as Trustee and
not individually
Class B 40,000 MARIAN SMITH D-R-A 1976 TRUST
f/b/o DEBRA SMITH KNEZ U/D/T
dated 12/16/76
By: /s/ Susan F. Smith
-------------------------
Susan F. Smith a/k/a Susan
M. Smith, as Trustee and
not individually
<PAGE>
Class B 120,000 MARIAN SMITH D-R-A 1976 TRUST
f/b/o DEBRA SMITH KNEZ U/D/T
dated 12/16/76
By: /s/ Susan F. Smith
-------------------------
Susan F. Smith a/k/a Susan
M. Smith, as Trustee and
not individually
Class B 120,000 MARIAN SMITH D-R-A 1976 TRUST
f/b/o ROBERT A. SMITH U/D/T
dated 12/16/76
By: /s/ Susan F. Smith
-------------------------
Susan F. Smith a/k/a Susan
M. Smith, as Trustee and
not individually
Class B 320,000 NANCY LURIE MARKS 1976 TRUST
f/b/o JEFFREY R. LURIE U/D/T
dated 12/16/76
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
By: /s/ Darline M. Lewis
-------------------------
Darline M. Lewis, as
Trustee and not
individually
<PAGE>
Class B 320,000 NANCY LURIE MARKS 1976 TRUST
f/b/o CATHY J. LURIE U/D/T
dated 12/16/76
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
By: /s/ Darline M. Lewis
-------------------------
Darline M. Lewis, as
Trustee and not
individually
Class B 320,000 NANCY LURIE MARKS 1976 TRUST
f/b/o PETER A. LURIE U/D/T
dated 12/16/76
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
By: /s/ Darline M. Lewis
-------------------------
Darline M. Lewis, as
Trustee and not
individually
Class B 160,000 MARIAN SMITH J-C-P 1976 TRUST
f/b/o JEFFREY R. LURIE U/D/T
dated 12/16/76
By: /s/ Nancy Lurie Marks
-------------------------
Nancy Lurie Marks, as
Trustee and not
individually
Class B 160,000 MARIAN SMITH J-C-P 1976 TRUST
f/b/o CATHY J. LURIE U/D/T
dated 12/16/76
By: /s/ Nancy Lurie Marks
-------------------------
Nancy Lurie Marks, as
Trustee and not
individually
<PAGE>
Class B 160,000 MARIAN SMITH J-C-P 1976 TRUST
f/b/o PETER A. LURIE U/D/T
dated 12/16/76
By: /s/ Nancy Lurie Marks
-------------------------
Nancy Lurie Marks, as
Trustee and not
individually
Class B 66,572 RICHARD A. SMITH FAMILY TRUST
U/W/O MARIAN J. SMITH f/b/o
ROBERT A. SMITH
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
By: /s/ Nancy L. Marks
-------------------------
Nancy L Marks, as Trustee
and not individually
Class B 66,572 RICHARD A. SMITH FAMILY TRUST
U/W/O MARIAN J. SMITH f/b/o
DEBRA SMITH KNEZ
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
By: /s/ Nancy L. Marks
-------------------------
Nancy L Marks, as Trustee
and not individually
Class B 66,570 NANCY S. LURIE FAMILY TRUST
U/W/O MARIAN J. SMITH f/b/o
CATHY J. LURIE
By: /s/ Nancy L. Marks
-------------------------
Nancy L. Marks, as Trustee
and not individually
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
<PAGE>
Class B 99,816 PETER A. LURIE TRUST U/W/O
MARIAN J. SMITH
By: /s/ Nancy L. Marks
-------------------------
Nancy L. Marks, as Trustee
and not individually
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
Class B 34,480 A-D-R CHARITABLE FOUNDATION
AND TRUST U/D/T dated 11/1/68
By: /s/ Susan F. Smith
-------------------------
Susan F. Smith a/k/a Susan
M. Smith, as Trustee and
not individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
Class B 198,040 MORRIS J. LURIE FAMILY TRUST
U/I/T dated 4/15/58 f/b/o
CATHY J. LURIE, ET AL.
By: /s/ Nancy L. Marks
-------------------------
Nancy L. Marks, as Trustee
and not individually
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
Class B 198,040 MORRIS J. LURIE FAMILY TRUST
U/I/T dated 4/15/58 f/b/o
PETER A. LURIE, ET AL.
By: /s/ Nancy L. Marks
-------------------------
Nancy L. Marks, as Trustee
and not individually
<PAGE>
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
Class B 160,000 AMY SMITH BERYLSON 1978
INSURANCE TRUST
By: /s/ Amy Smith Berylson
-------------------------
Amy Smith Berylson, as
Trustee and not
individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
Class B 70,000 ROBERT A. SMITH 1978
INSURANCE TRUST
By: /s/ Robert A. Smith
-------------------------
Robert A. Smith, as
Trustee and not
individually
By: /s/ Mark D. Balk
-------------------------
Mark D. Balk, as Trustee
and not individually
Common 1,415,000* RICHARD AND SUSAN SMITH
FAMILY FOUNDATION
By: /s/ Susan F. Smith
-------------------------
Susan F. Smith, as Trustee
and not individually
By: /s/ Richard A. Smith
-------------------------
Richard A. Smith, as
Trustee and not
individually
------------
* converted from Class B Stock and transferred to Stockholder on October 25,
2000.
<PAGE>
Common 443,818* NANCY LURIE MARKS FAMILY
FOUNDATION
By: /s/ Nancy Lurie Marks
-------------------------
Nancy Lurie Marks, as
Trustee and not
individually
Class B 122,774 /s/ Amy Smith Berylson
----------------------------
Amy Smith Berylson
Class B 22,191 /s/ Amy Smith Berylson
----------------------------
Amy Smith Berylson, as
Guardian of Elizabeth S.
Berylson
/s/ John G. Berylson
----------------------------
John G. Berylson, as Guardian
of Elizabeth S. Berylson
Class B 22,190 /s/ Jennifer L. Berylson
----------------------------
Jennifer L. Berylson
Class B 7,666 /s/ Robert A. Smith
----------------------------
Robert A. Smith
Class B 15,205 /s/ Debra Smith Knez
----------------------------
Debra Smith Knez
Class B 1,600 /s/ Cathy J. Lurie
----------------------------
Cathy J. Lurie
Class B 122,774 /s/ Jeffrie R. Lurie
----------------------------
Jeffrie R. Lurie, as Guardian
of Julian M.J. Lurie
Class B 33,285 /s/ Jeffrey R. Lurie
------- ----------------------------
Jeffrey R. Lurie, as Guardian
of Milena C. Lurie
TOTAL 19,955,998
For purposes of Section 4.11
only:
REED ELSEVIER PLC
By: /s/ Henry Z. Horbaczewski
--------------------------
Name: Henry Z. Horbaczewski
Title: Attorney-in-fact
<PAGE>
Exhibit A
1,345,502 shares of Class B Stock owned by Nancy Lurie Marks and 1,250,000
shares of Class B Stock owned by Nancy Lurie Marks and Richard A. Smith not in
their individual capacities but as Trustees under the trust established f/b/o
Nancy Lurie Marks under Article VIII of the will, dated December 24, 1959 of
Philip Smith, are pledged under Pledge Agreements dated May 13, 1994 (the
"Pledge Agreements"), to secure certain loans made by certain lenders to
finance, in part, the acquisition of the Philadelphia Eagles Football Team (the
"Pledged Shares").
If there is an event of default under the terms of the loan agreements
relating to such acquisition (the "Loan Agreements"), the lenders have the
right to vote the Pledged Shares and to require proxies from the pledgers to
enable the lenders to exercise voting power over the Pledged Shares.
