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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D/A
Under the Securities Exchange Act of 1934
(Amendment No.4)*
SCANFORMS, INC.
--------------------------------
(Name of Issuer)
COMMON STOCK, $.01 PAR VALUE
--------------------------------
(Title of Class of Securities)
806011 30 0
--------------------------------
(CUSIP Number)
WOLF, BLOCK, SCHORR AND SOLIS-COHEN
Twelfth Floor Packard Building
Philadelphia, PA 19102
Attention: Mark K. Kessler, Esquire
(215) 977-2000
--------------------------------
Authorized to Receive Notices and Communications)
June 14, 1996
(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 / /.
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Check the following box if a fee is being paid with the statement / /.
(A fee is not required only if the reporting person: (1) has a previous
statement on file reporting beneficial ownership of more than five percent of
the class of securities described in Item 1; and (2) has filed no amendment
subsequent thereto reporting beneficial ownership of five percent or less of
such class.) (See Rule 13d-7.)
Note: Six copies of this Statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Page 1 of 6 Pages
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SCHEDULE 13D/A
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CUSIP NO. 806011 30 0 Page 2 of 6 Pages
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1 NAME OF REPORTING PERSON
ROBERT A. SAMANS
S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) / /
(b) / /
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
N/A - Option and voting proxy with respect to shares of Common
Stock were granted
- ------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) / /
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
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NUMBER OF 7 SOLE VOTING POWER
SHARES 1,006,268
BENEFICIALLY -----------------------------------------------
OWNED BY 8 SHARED VOTING POWER
EACH 0
REPORTING -----------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH 1,006,268
-----------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- ------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,006,268
- ------------------------------------------------------------------------------
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* / /
- ------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
28.4%
- ------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- ------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
SCHEDULE 13D/A
Item 3. Source and Amount of Funds or Other Consideration.
The last paragraph of Item 3 of the Schedule 13D filing made
October 13, 1992 by the undersigned, Robert A. Samans (the "Reporting Person"),
as amended by the Schedule 13D filings made by the Reporting Person dated
February 1, 1996, February 15, 1996 and April 4, 1996 (collectively, the
"Schedule 13D"), is deleted in its entirety.
Item 4. Purpose of Transaction.
Item 4 of the Schedule 13D is amended and restated in its
entirety to provide as follows:
"The Reporting Person originally acquired the shares under the
1992 Stock Purchase Agreement for the purpose of maintaining control of the
Company and effecting an amicable termination of the Group's investment in the
Company.
On February 15, 1996, the Company entered into a merger
agreement with SCFM Corp., a Delaware corporation which is wholly owned by the
Reporting Person and Mr. Carcioppolo (the Reporting Person and Mr. Carcioppolo
are hereinafter referred to together as the "Management Group"), which would pay
$3.60 cash per share to the Company's public shareholders (including the
purchase at that price of an aggregate of $500,000 of common stock held by each
of the Reporting Person and Mr. Carcioppolo) and would result in the Company
becoming privately held by the Reporting Person and Mr. Carcioppolo. This action
resulted from a process commenced with a public announcement in March 1995 of
the Company's willingness to consider proposals for a significant transaction,
and subsequent efforts by Janney Montgomery Scott, the investment banking firm
retained for that purpose. The Management Group subsequently increased the cash
price per share to be paid to the Company's public shareholders in the merger
from $3.60 to $3.80. The increase resulted from further negotiations with the
Company's Independent Director in light of the Company's recent results of
operations.
On June 14, 1996, the merger agreement between SCFM and the
Company was terminated as part of an agreement in principle entered into between
the Company and Big Flower Press Holdings, Inc. ("Big Flower"), a Delaware
corporation, pursuant to which Big Flower would acquire the Company by merger in
a stock-for-stock exchange that values the Company at approximately $5.75 per
share, as determined specifically by the Big Flower common stock price for the
ten day period preceding the meeting of the Company's shareholders to approve
the merger. Also on June 14, 1996, as a condition to Big Flower's willingness to
enter into the agreement in principle, the Reporting Person granted to Big
Flower an option to purchase and a voting proxy, effective when the option
becomes exercisable, on 1,006,268 shares of Common Stock owned by the Reporting
Person and Mr. Carcioppolo granted to Big Flower an option to purchase and a
voting proxy, effective when the option becomes exercisable, on 550,620 shares
of Common Stock owned by Mr. Carcioppolo. See Item 6 for a description of the
option and voting proxy granted by each of the Reporting Person and Mr.
Carcioppolo to Big Flower.
At the present time, other than the actions described in the
preceding paragraphs, the Reporting Person has no specific plans or proposals
that would relate to or result in any of the actions specified in clauses (a)
through (j) of Item 4. However, the Reporting Person may consider any such plans
or proposals in the future, if deemed appropriate."
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Item 5. Interest in Securities of the Issuer.
Item 5 of the Schedule 13D is amended and restated in its
entirety to provide as follows:
"On the date of this Schedule 13D, the Reporting Person is the
beneficial owner of 1,006,268 shares of Common Stock. Based upon the 3,546,648
shares of Common Stock currently outstanding, as reported in the Company's
Quarterly Report on Form 10-Q for the twenty-six weeks ended March 31, 1996 (the
"Form 10-Q"), the Reporting Person beneficially owns 28.4% of the outstanding
Common Stock.
On June 14, 1996, as a condition to Big Flower's willingness
to enter into an agreement in principle with the Company in connection with its
proposed acquisition of the Company, the Reporting Person granted to Big Flower
an option to purchase and voting proxy, effective when the option becomes
exercisable, on 1,006,268 shares of Common Stock owned by the Reporting Person
and Mr. Carcioppolo granted to Big Flower an option to purchase and a voting
proxy, effective when the option becomes exercisable, on 550,620 shares of
Common Stock owned by Mr. Carcioppolo. See Item 6 for further discussion of the
option and voting proxy granted by each of the Reporting Person and Mr.
Carcioppolo to Big Flower. The Reporting Person has sole voting power and sole
dispositive power with respect to the 1,006,268 shares of Common Stock owned by
the Reporting Person."
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer.
Item 6 of the Schedule 13D is amended in its entirety to
provide as follows:
"As a condition to Big Flower's willingness to enter into an
agreement in principle with the Company in connection with its proposed
acquisition of the Company, the Reporting Person entered into the Option
Agreement dated as of June 14, 1996 by and among Big Flower, the Reporting
Person and Sebastian A. Carcioppolo (the "Option Agreement") pursuant to which
the Reporting Person granted to Big Flower an option to purchase and a voting
proxy, effective when the option becomes exercisable, on 1,006,268 shares of the
Common Stock owned by the Reporting Person and Mr. Carcioppolo granted to Big
Flower an option to purchase and a voting proxy, effective when the option
becomes exercisable, on 550,620 shares of Common Stock owned by Mr. Carcioppolo.
The proxy granted to Big Flower by each of the Reporting Person and Mr.
Carcioppolo entitles Big Flower to vote all of the shares of Common Stock owned
by the Reporting Person and by Mr. Carcioppolo at all times during which the
option granted pursuant to the Option Agreement is exercisable. In the Option
Agreement, Big Flower agrees to vote the optioned shares in favor of the merger
of the Company with Big Flower and each of the Reporting Person and Mr.
Carcioppolo agrees to vote his shares of Common Stock in favor of the merger
with Big Flower in the event the grant of the proxy is not effective. In the
Option Agreement, the Reporting Person also grants to Big Flower an option to
purchase 1,006,268 shares of Common Stock owned by the Reporting Person and Mr.
Carcioppolo grants to Big Flower an option to purchase 550,620 shares of Common
Stock owned by Mr. Carcioppolo, for $5.75 cash per share (the "Purchase Price").
<PAGE>
Big Flower may exercise the options granted by the Reporting
Person and Mr. Carcioppolo pursuant to the Option Agreement in whole but not in
part and at any time from the date of the Option Agreement until January 31,
1997 or such date to which the term of the Option Agreement is extended (the
"Expiration Date") if (a) a Takeover Proposal (as hereinafter defined) has been
made on terms which in the opinion of Big Flower, in its reasonable good faith
judgment, is for consideration of a higher value than the Purchase Price and (i)
Big Flower and the Company are proceeding to negotiate in good faith and execute
a definitive Agreement of Merger as provided in the agreement in principle (the
"Merger Agreement") or the Company has ceased to negotiate a Merger Agreement or
(ii) a Merger Agreement has been entered into by Big Flower and the Company and
the Takeover Proposal is made prior to the termination of the Merger Agreement
or (b) if a Takeover Proposal has been made by any person who is a director or
officer of the Company on the date of the Option Agreement or by an entity in
which any such person has an equity interest of 10% or more or a "group" (within
the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended), in which any such person is a participant. "Takeover Proposal" means,
with respect to the Company, any proposal or offer for, any tender or exchange
offer for 20% or more of the equity of the Company, any merger, consolidation or
other business combination involving the Company or any of its Significant
Subsidiaries, any acquisition in any manner of 20% or more of the equity of, or
20% or more of the assets of, the Company or any of its Significant Subsidiaries
(and "Significant Subsidiaries" shall have the meaning specified in Rule 1-02 of
Regulation S-X of the Securities and Exchange Commission). Notwithstanding the
foregoing, Big Flower may not exercise the options granted under the Option
Agreement if a preliminary or permanent injunction or other order against the
delivery of the optioned shares issued by any federal or state court of
competent jurisdiction shall be in effect, but in such event the Expiration Date
shall be extended until five business days after such impediment to exercise
shall have been removed. In the event that a Takeover Proposal is made during
the Term of the Option Agreement and Big Flower has exercised the option(s)
granted under the Option Agreement and an investment banking firm mutually
agreed upon by Big Flower and the Company renders its opinion that the Takeover
Proposal is more favorable to the shareholders of the Company than that being
offered by Big Flower in the merger, Big Flower agrees that it will vote or take
appropriate action in favor of the Takeover Proposal and, if a Merger Agreement
has been entered into with the Company, that it will take appropriate action to
terminate the Merger Agreement. The description of the Option Agreement
contained herein is qualified in its entirety by reference to the Option
Agreement which is filed with this Schedule 13D as Exhibit 15 and incorporated
in its entirety herein by reference."
Item 7. Exhibits. Page
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Exhibit 12 Scanforms, Inc. News Release dated June 6, 1996 **
Exhibit 13 Scanforms, Inc. News Release dated June 14, 1996 **
Exhibit 14 Agreement of Reporting Person to terminate
Merger Agreement **
Exhibit 15 Option Agreement dated as of June 14, 1996 by and
among Big Flower Press Holdings, Inc.,
Robert A. Samans and Sebastian A. Carcioppolo **
** Filed electronically herewith.
<PAGE>
Signature
After 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.
/s/ Robert A. Samans
-------------------------
Robert A. Samans
Dated: June 20, 1996
<PAGE>
SCANFORMS, INC.
181 Rittenhouse Circle
Bristol, PA 19007-0602
(215) 785-0101 1-800-523-3936
Fax: (215) 785-6451
NEWS RELEASE
FOR IMMEDIATE RELEASE
Contact: Emma Marie Cocci
Secretary
(215) 785-0101
SCANFORMS MANAGEMENT GROUP
INCREASES MERGER OFFER TO $3.80 PER SHARE
-----------------------------------------
Bristol, PA, June 6, 1996 -- Scanforms, Inc. (NASDAQ Small Cap:SCFM) today
reported that the management group with whom the Company has entered into a
merger agreement has increased the cash price to be paid to the Company's public
shareholders in the merger from $3.60 to $3.80. The increase resulted from
further negotiations with the Company's Independent Director in light of the
Company's recent results of operations. The management group consists of the
Company's Chairman and President, Robert A. Samans, and one of its Directors.
The merger agreement was entered into by the Company and the management group on
February 15, 1996 following a process commenced with a public announcement in
March 1995 of the Company's willingness to consider proposals for a significant
transaction, and subsequent efforts by Janney Montgomery Scott, an investment
banking firm retained for that purpose.
The merger is conditioned upon the completion of final documentation of a bank
financing, the receipt by the Board of Directors of a current fairness opinion
from Janney Montgomery Scott and the approval of the Company's shareholders. The
Company is in the process of finalizing its proxy materials with the Securities
and Exchange Commission.
Scanforms is a full-service manufacturer of direct mail advertising with
in-house forms manufacturing, laser computer personalization and mailing
services.
<PAGE>
Press Release
DATE: June 17, 1996
FOR FURTHER INFORMATION CONTACT:
Nancy S. Murrary Emma Marie Cocci
Big Flower Press Scanforms, Inc.
212.521.1606 215.785.0101
BIG FLOWER PRESS TO ACQUIRE DIRECT MAIL SPECIALIST
SCANFORMS, INC. IN STOCK TRANSACTION
New York City - Big Flower Press Holdings, Inc. (NYSE: BGF), a leading
advertising and information services company, and Scanforms, Inc. (Nasdaq:
SCFM), a full-service direct mail advertising company with revenues of $27
million for the 12 months ended March 31, 1996, announced today they have
entered into an agreement providing for the acquisition of Scanforms by Big
Flower Press.
Scanforms specializes in highly-targeted direct mail, which is complimentary to
Big Flower's Webcraft Technologies business, a market leader in producing
personalized, highly-customized direct mail.
Scanforms will be acquired in a stock-for-stock exchange which values the
company at $5.75 per share; provided that Big Flower would not issue more than
0.4259 nor less than 0.3966 shares of its common stock for each share of
Scanforms common stock. Total consideration for the company will be
approximately $26.5 million, including consideration paid for employee options,
and the assumption of approximately $5.1 million of debt. The acquisition,
subject to certain conditions including preparation of definitive documentation
and approval by Scanforms' shareholders, is expected to close by August 31,
1996. Big Flower has been granted a voting proxy on, and an option to purchase
approximately 43% of Scanforms outstanding shares by Scanforms' two principal
shareholders, including Chairman Robert A. Samans. Approval of the shareholders
of Big Flower Press is not required.
<PAGE>
"Strategically, Scanforms expands our customer base and adds new high-impact
products and services to our advertising and information services portfolio,"
and Theodore Ammon, Chairman and CEO of Big Flower Press.
"Scanforms' advanced direct mail technology and national customer base
complements our growing Webcraft business and our strategy of building a
comprehensive portfolio of broad-based advertising services," said Ed Reilly,
President and COO of Big Flower Press, adding "In addition, Scanforms' ability
to effectively produce highly personalized, fast-turnaround products gives Big
Flower a substantial competitive advantage in the marketplace."
Mr. Samans, Chairman of Scanforms, said, "This acquisition represents an ideal
culmination of all of our efforts in recent years. Now we are able to combine
with a truly great company, and expand our product line while continuing to
deliver high-quality services to our customers. In so doing, we are able to
deliver meaningful value to our shareholders."
Scanforms, Inc., a 27-year old company headquartered in Bristol, Pennsylvania,
counts among its growing customer base leading financial services corporations
and publishing companies.
Big Flower Press is a leading advertising and information services company with
expertise in advertising circulars, circulation-building newspaper products,
image management, specialized direct mail products, commercial games and
fragrance samplers. For the 12-month period ended March 31, 1996, Big Flower
generated pro forma net sales of approximately $1.3 billion, reflecting the
acquisition of Laser Tech Color in November 1995 and Webcraft Technologies in
March 1996.
<PAGE>
I hereby agree to the termination of the Agreement and Plan of Merger by and
between Scanforms, Inc. and SCFM Corp.
/s/ Robert A. Samans
- --------------------
Robert A. Samans
June 14, 1996
<PAGE>
Option Agreement
----------------
Option Agreement (the "Agreement") dated as of June 14, 1996
by and among Big Flower Press Holdings, Inc., a Delaware corporation ("Big
Flower"), and those stockholders of Scanforms, Inc., a Delaware corporation (the
"Company"), whose names are listed on Schedule 1 attached hereto and made a part
hereof (each of whom is referred to individually as a "Stockholder," and all of
whom are referred to together as the "Stockholders").
WHEREAS, Big Flower is concurrently herewith entering into a
letter of intent (the "Letter Agreement") with respect to the proposed
acquisition of the Company by Big Flower pursuant to a merger of a direct or
indirect subsidiary of Big Flower with the Company (the "Merger"); and
WHEREAS, as a condition to its willingness to enter into the
Letter Agreement, Big Flower has requested that the Stockholders agree, and each
of the Stockholders has agreed, to grant Big Flower an Option (as hereinafter
defined) to purchase all of the shares of common stock, par value $.01 per
share, of the Company ("Shares") owned by him.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein, the parties hereto agree as follows:
1. Grant of the Option. Each Stockholder hereby grants Big
Flower an irrevocable option (an "Option") to purchase all of the Shares set
forth opposite such Stockholder's name on Schedule 1 attached hereto at a price,
in cash, of $5.75 per Share (the "Purchase Price"). The Shares to which the
Option applies are referred to herein as the "Optioned Shares".
2. Exercise of the Option. (a) Big Flower may exercise the
Option in whole but not in part and at any time from the date hereof until the
Expiration Date (as defined below in Section 2(b)) (such period being the "Term"
of this Agreement) if after the date of this Agreement (i) a Takeover Proposal
(as hereinafter defined) has been made on terms which in the opinion of Big
<PAGE>
Flower, in its reasonable good faith judgment, is for consideration of a higher
value than the Purchase Price and (x) Big Flower and the Company are proceeding
to negotiate in good faith and execute a definitive Agreement of Merger as
provided in the Letter Agreement (the "Merger Agreement") or the Company has
ceased to negotiate a Merger Agreement or (y) a Merger Agreement has been
entered into by Big Flower and the Company and the Takeover Proposal is made
prior to the termination of the Agreement of Merger or (ii) if a Takeover
Proposal has been made by any person who is a director or officer of the Company
on the date hereof or by an entity in which any such person has an equity
interest of 10% or more or a "group" (within the meaning of Section 13(d)(3) of
the Exchange Act (as hereinafter defined)) in which any such person is a
participant. "Take-over Proposal" means, with respect to the Company, any
proposal or offer for, any tender or exchange offer for 20% or more of the
equity of the Company, any merger, consolidation or other business combination
involving the Company or any of its Significant Subsidiaries, any acquisition in
any manner of 20% or more of the equity of, or 20% or more of the assets of, the
Company or any of its Significant Subsidiaries and "Significant Subsidiary"
shall have the meaning specified in Rule 1-02 of Regulation S-X of the
Securities and Exchange Commission.
(b) Notwithstanding the foregoing, Big Flower may not exercise
the Option if a preliminary or permanent injunction or other order against the
delivery of the Shares issued by any federal or state court of competent
jurisdiction in the United States shall be in effect, but in such event the
Expiration Date of the Option shall be extended until five business days after
such impediment to exercise shall have been removed. For purposes of this
Agreement, the Expiration Date shall mean January 31, 1997 or such date to which
the Term of this Agreement has been extended.
(c) If Big Flower wishes to exercise the Option, Big Flower
shall give a written notice to the Stockholder of its intention to exercise the
Option and the closing of the purchase of the Optioned Shares (the "Closing")
shall take place in the offices of Skadden, Arps, Slate, Meagher & Flom, 919
Third Avenue, New York, New York 10022, on a date and at a time designated by
Big Flower at the time that it gives notice of its intention to exercise the
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Option (which date and time may be one day after the delivery of such notice or
earlier if reasonably practicable and shall not be more than five business days
after delivery of such notice). If the Option shall expire on the Expiration
Date without having been exercised, this Agreement shall expire and all of the
obligations of the parties under this Agreement shall be of no further force and
effect.
(d) In the event that a Takeover Proposal is made during the
Term of this Agreement and Big Flower has exercised the Option and an investment
banking firm mutually agreed upon by Big Flower and the Company (or if mutual
agreement can not be reached as to such firm, by an investment banking firm
mutually agreed upon by an investment banking firm chosen by Big Flower and an
investment banking firm chosen by the Company) renders its opinion that the
Takeover Proposal is more favorable to the shareholders of the Company than that
being offered by Big Flower in the Merger, Big Flower agrees that it will vote
or take appropriate action in favor of the Takeover Proposal and, if a Merger
Agreement has been entered into with the Company, that it will take appropriate
action to terminate the Merger Agreement.
3. Closing. At any Closing hereunder:
(a) Big Flower shall make payment to each Stockholder in the
aggregate amount equal to the product of (x) the Purchase Price and (y) the
number of Optioned Shares to be purchased from such Stockholder, by delivery of
a certified check or bank cashier's check payable to the order of such
Stockholder; and
(b) each Stockholder shall deliver to Big
Flower the certificate or certificates representing the Optioned Shares to be
purchased from such Stockholder, in form satisfactory to Big Flower, together
with stock powers endorsed in blank.
4. Negative Covenants of the Stockholders. Except in
accordance with the provisions of this Agreement, each Stockholder agrees during
the Term of this Agreement not to:
3
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(a) sell, transfer, pledge, assign or otherwise dispose of, or
enter into any contract, option or other arrangement or understanding with
respect to the sale, transfer, pledge, assignment or other disposition of any
Optioned Shares;
(b) grant any proxies, deposit or withdraw any Optioned Shares
into or from a voting or other trust or enter into a voting agreement with
respect to any Optioned Shares;
(c) solicit, encourage, participate in or initiate discussions
or negotiations with, or provide information to, any person or any entity or
group, other than Big Flower or any affiliate of Big Flower, concerning any
merger, sale of assets, lease of property, sale of shares of capital stock or
similar transactions involving the Company;
(d) take any other action which could reasonably result in
frustrating the exercise of the Option.
5. Affirmative Covenants of the Stockholders.
(a) Communication of Offers. Promptly following execution of
this Agreement, each Stockholder hereby covenants and agrees to immediately
communicate to Big Flower the terms (including the identity or identities of the
party or parties) and deliver a copy of, any proposal, discussion, negotiation
or inquiry which the Stockholder may receive, or which to the knowledge of the
Stockholder the Company has received, with respect to any of the transactions
set forth in Section 4(c) of this Agreement.
(b) Proxy. Each Stockholder constitutes and appoints, at all
times during which the Option is exercisable as provided in Section 2 hereof,
Big Flower to act as its true and lawful proxy and attorney-in-fact in the name
and on behalf of such Stockholder, with full power of substitution, to vote its
Optioned Shares at any meeting of shareholders of the Company or any adjournment
or adjournments thereof, or to give a consent with respect to its Optioned
Shares upon any and all such matters as each such proxy or his substitute shall
in his sole discretion deem proper. All power and authority hereby conferred is
coupled with an interest and is irrevocable.
4
<PAGE>
(c) Stockholder Agreement to Vote. Each Stockholder agrees,
provided his proxy has not been granted to Big Flower pursuant to Section 5(b)
hereof, to vote the Optioned Shares in favor of the Merger.
(d) Big Flower Agreement to Vote. Big Flower agrees, in the
event that it has acquired the proxy of a Stockholder pursuant to Section 5(b)
above and the Merger Agreement has not been terminated, that it will vote in
favor of approval of the Merger Agreement.
6. Representations and Warranties of the Stockholders. Each
Stockholder represents and warrants to Big Flower with respect to such
Stockholder and the Optioned Shares owned by such Stockholder as follows:
(a) Such Stockholders Optioned Shares are the only Shares
which such Stockholder has the right, power and authority to sell and such
Stockholder does not own or have any right to acquire any other Shares;
(b) Such Stockholder has the right, power and authority to
execute and deliver this Agreement and to sell such Stockholder's Optioned
Shares in accordance with the terms of this Agreement; such execution, delivery
and sale will not violate, or require any consent, approval, or notice under,
any provision of law; and this Agreement has been duly executed and delivered by
such Stockholder and constitutes a legal, valid and binding agreement of such
Stockholder, enforceable in accordance with its terms;
(c) Such Optioned Shares and the certificates representing
such Optioned Shares are now and will at all times during the term of this
Agreement be held by such Stockholder, free and clear of all liens, claims,
security interests, proxies, voting trusts or agreements or any other
encumbrances whatsoever ("Encumbrances") with respect to the ownership or voting
of the Optioned Shares or otherwise, other than Encumbrances created pursuant to
this Agreement; and there are no outstanding options, warrants or rights to
purchase or acquire, or agreements relating to, the Optioned Shares other than
this Agreement;
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<PAGE>
(d) upon the purchase of such Stockholder's Optioned Shares in
accordance with the terms hereof, Big Flower will be vested with good, valid and
marketable title to such Optioned Shares, free and clear of all Encumbrances;
(e) Other than the filings required by the Company pursuant to
Regulation 13D-G under and Section 16(a) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), no filing with, and no permit, authorization,
consent or approval of, any public body or authority is necessary for the
execution of this Agreement or the consummation by such Stockholder of the
transactions contemplated hereby; and
(f) neither the execution and delivery of this Agreement by
such Stockholder nor the consummation by the Stockholder of the transactions
contemplated hereby nor compliance by such Stockholder with any of the
provisions hereof will (i) conflict with or result in any breach of any
provision of the Certificate of Incorporation or ByLaws of the Company or any of
its subsidiaries, (ii) result in a violation or breach of, or constitute (with
or without due notice or lapse of time or both) a default (or give rise to any
right of termination, cancellation or acceleration) under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, license,
contract, lease, agreement or other instrument or obligation to which the
Company or any of its subsidiaries, or such Stockholder, is a party or by which
any of them or any of their properties or assets may be bound or (iii) violate
any order, writ, injunction, judgment, decree, statute, rule or regulation
applicable to the Company, any of its subsidiaries, any of their properties or
assets or the Stockholder, except (with respect to the Company and its
subsidiaries only) in the case of (ii) or (iii) for violations, breaches or
defaults (x) which are not in the aggregate material to the Company and its
subsidiaries taken as a whole and which will not prevent or delay the
consummation of the transactions contemplated hereby and (y) the fact that the
exercise of the Option will result in a default under the Company's loan and
credit facility with Mellon Bank and under a $560,000 equipment note with
Concord Commercial Corporation.
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7. Representations and Warranties of the Purchaser. Big Flower
hereby represents and warrants and to each Stockholder that:
(a) it has all requisite corporate power and authority to
execute and deliver this Agreement; such execution and delivery have been duly
authorized by all necessary corporate action on the part of Big Flower; and this
Agreement has been duly executed and delivered by Big Flower and constitutes a
legal, valid and binding agreement on the part of Big Flower, enforceable in
accordance with its terms;
(b) Other than the filings required by Big Flower pursuant to
Regulation 13D-G under and Section 16(a) of the Exchange Act, no filing with,
and no permit, authorization, consent or approval of, any public body or
authority is necessary for the execution of this Agreement or the consummation
by Big Flower of the exercise of the Option;
(c) it is acquiring the Optioned Shares to be delivered upon
the exercise of the Option for investment only and not with a view to the
distribution thereof and will not offer to sell or otherwise dispose of the
Shares so acquired in violation of the Securities Act of 1933, as amended; and
(d) neither the execution and delivery of this Agreement by
Big Flower nor the consummation by Big Flower of the transactions contemplated
hereby nor compliance by Big Flower with any of the provisions hereof will (i)
conflict with or result in any breach of any provision of the Certificate of
Incorporation or By-Laws of Big Flower or any of its subsidiaries, (ii) result
in a violation or breach of, or constitute (with or without due notice or lapse
of time or both) a default (or give rise to any right of termination,
cancellation or acceleration) under, any of the terms, conditions or provisions
of any note, bond, mortgage, indenture, license, contract, lease, agreement or
other instrument or obligation to which Big Flower or any of its subsidiaries is
a party or by which any of them or any of their properties or assets may be
bound or (iii) violate any order, writ, injunction, judgment, decree, statute,
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rule or regulation applicable to Big Flower, any of its subsidiaries or any of
their properties or assets, except in the case of (ii) or (iii) for violations,
breaches or defaults which are not in the aggregate material to Big Flower and
its subsidiaries taken as a whole and which will not prevent or delay the
consummation of the transactions contemplated hereby.
8. Adjustments. In the event of any change in the number of
shares of capital stock of the Company, by reason of stock dividends, split-ups,
recapitalizations, combinations, the number and kind of Optioned Shares of such
Stockholder subject to the Option and the Purchase Price therefor shall be
appropriately adjusted.
9. Legend. As soon as practicable after the execution of this
Agreement, each Stockholder shall cause his Optioned Shares to contain a legend
to the effect that such Shares are subject to the terms of this Agreement and
this Agreement places limits on the voting and transfer of such Shares.
10. Specific Performance. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed by each Stockholder in accordance with their
specific terms or were otherwise breached. Accordingly, each Stockholder agrees
that Big Flower shall be entitled to an injunction or injunctions to prevent
breaches of this Agreement and to enforce specifically the terms and provisions
hereof in any court of the United States or any state having jurisdiction, this
being in addition to any other remedy to which it is entitled at law or in
equity.
11. Further Assurances. Each Stockholder and Big Flower will
execute and deliver all such further documents and instruments and take all such
further action as may be necessary in order to consummate the transactions
contemplated hereby.
12. Expenses; No Brokerage Fees. Each party hereto shall pay
its own expenses incurred in connection with this Agreement whether or not Big
Flower purchases any Optioned Shares or acquires the Company. Each Stockholder
agrees to indemnify Big Flower, and Big Flower agrees to indemnify each
Stockholder against any liability for brokerage fees, finder's fees, or similar
forms of compensation incurred in connection with the execution of this
Agreement or the exercise of the Option by reason of action taken by such
indemnifying party.
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13. Parties in Interest; Assignment. This Agreement is binding
upon and is solely for the benefit of the parties hereto and their respective
successors, legal representatives and assigns, and nothing in this Agreement,
express or implied, is intended to or shall confer upon any other person any
rights, benefits or remedies of any nature whatsoever under or by reason of this
Agreement. Neither party shall have the right to assign its rights under this
Agreement, except that Big Flower shall have the right to assign to any
subsidiary of Big Flower any and all rights of Big Flower under this Agreement,
provided no such assignment shall relieve Big Flower of any of its obligations
hereunder.
14. Public Announcements. Each of the Stockholders agrees that
with respect to this Agreement or the transactions contemplated hereby, such
Stockholder shall not issue any press release or make any public statement
without the approval of Big Flower which approval shall not be unreasonably
withheld; provided that Big Flower shall be afforded a reasonable opportunity to
review and comment on the proposed press release or public statement prior to
its dissemination by any Stockholder.
15. Amendments. This Agreement may not be modified, amended,
altered or supplemented except upon the execution and delivery of a written
agreement executed by all of the parties hereto.
16. Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly given upon receipt) by delivery in person, by cable,
telegram or telex, or by registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
If to a Stockholder, at the address set forth opposite such
Stockholder's name on Schedule 1 attached hereto.
If to Big Flower:
Big Flower Press Holdings, Inc.
3 East 54th Street
New York, New York 10022
Telecopy: (212)223-4074
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Attention: General Counsel
or to such other address as any party may have furnished to the other parties in
writing in accordance herewith.
17. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard to
its conflict of law rules.
18. Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute but one agreement.
19. Effect of Headings. The descriptive headings contained
herein are for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
20. Partial Invalidity. The invalidity or unenforceability of
any provision of this Agreement shall not affect the validity or enforceability
of any other provisions of this Agreement, which shall remain in full force and
effect.
21. Dividends. Each Stockholder shall be entitled to receive
dividends, if any, declared as of a record date prior to the date of any notice
by Big Flower of its intention to exercise the Option with respect to the
Optioned Shares covered by such notice.
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IN WITNESS WHEREOF, each of the parties has caused this
Agreement to be duly executed as of the day and year first above written.
BIG FLOWER PRESS HOLDINGS, INC.
By: /s/ R. Theodore Ammon
-----------------------------
Name: R. Theodore Ammon
Title: Chairman of the Board
STOCKHOLDERS
/s/ Robert A. Samans
------------------------------
Robert A. Samans
/s/ Sebastian A. Carcioppollo
------------------------------
Sebastian A. Carcioppollo
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Schedule 1
Name Shares Address
---- ------ -------
Robert A. Samans 1,006,268
Sebastian A. Carcioppollo 550,620
