SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 4)
Mafco Consolidated Group Inc.
(Name of issuer)
Common Stock, par value $.01 per share
(Title of class of securities)
559025 10 1
(CUSIP number)
Barry F. Schwartz
35 East 62nd Street
New York, New York 10021
(212) 572-8500
(Name, address and telephone number of person
authorized to receive notices and communications)
with a copy to:
Alan C. Myers, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
919 Third Avenue
New York, New York 10022
(212) 735-3000
February 20, 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 |_|.
This statement amends and supplements the Statement on
Schedule 13D, as amended (the "Schedule 13D"), filed with the Securities
and Exchange Commission by Mafco Holdings Inc., a Delaware corporation
("Mafco Holdings"), and Mafco Consolidated Holdings Inc., a Delaware
corporation ("Mafco Consolidated Holdings"), in connection with their
ownership of shares of common stock, par value $.01 per share, of Mafco
Consolidated Group Inc., a Delaware corporation ("Mafco"). Unless
otherwise defined herein, all capitalized terms used herein shall have
the meanings ascribed to them in the Schedule 13D.
Item 4. Purpose of Transaction.
Item 4 is hereby amended to add the following at the end
thereof:
"On February 20, 1997, Mafco Consolidated Holdings entered
into an Agreement and Plan of Merger (the "Merger Agreement"), dated
February 19, 1997, with Mafco and MCG Acquisition Inc. (the "Purchaser"),
pursuant to which the Purchaser will be merged with and into Mafco (the
"Merger") with Mafco being the surviving corporation, the directors of
the Purchaser becoming the directors of Mafco and Mafco becoming a wholly
owned subsidiary of Mafco Consolidated Holdings. Pursuant to the Merger
Agreement, each share of Common Stock (other than shares held by Mafco
Consolidated Holdings or any of its subsidiaries) will be converted into
the right to receive the Merger Consideration.
The "Merger Consideration" shall be equal to the sum of
(x) $33.50 and (y) if the average of the per share closing prices of the
common stock, par value $.01 per share ("Cigar Common Stock"), of
Consolidated Cigar Holdings Inc., a Delaware corporation and a subsidiary
of Mafco ("Consolidated Cigar"), on the New York Stock Exchange for the
ten trading days ending two trading days prior to the effectiveness of
the Merger (the "Average"), exceeds $33.00 (the amount by which the
Average exceeds $33.00, the "Excess"), then:
(i) if Mafco shall not have sold shares of Cigar Common
Stock in an underwritten secondary offering (the "Cigar Secondary
Offering") or shall have sold shares of Cigar Common Stock in the
Cigar Secondary Offering at a gross sales price per share in
excess of $33.00, an amount equal to the Excess; or
(ii) if Mafco shall have sold shares of Cigar Common Stock
in the Cigar Secondary Offering at a gross sales price per share
of $33.00 or less, an amount equal to the Excess multiplied by a
fraction, the numerator of which shall be the number of shares of
Cigar Common Stock beneficially owned by the Company immediately
following, and the denominator of which shall be the number of
shares of Cigar Common Stock beneficially owned by Mafco
immediately prior to, the consummation of the Cigar Secondary
Offering.
On February 20, 1997, Mafco's board of directors declared
a special cash dividend of $10.00 per share, payable on March 14, 1997 to
stockholders of record as of the close of business on March 10, 1997. As
a result of the Merger and the dividend, Mafco stockholders will receive
$43.50 in cash for each share of Common Stock, subject to upward
adjustment as described above. The payment of the special cash dividend
is not conditioned upon the consummation of the Merger.
The Merger Agreement has been unanimously approved by the
boards of directors of each company and, in the case of Mafco, by a
special committee of independent directors formed to consider the
transaction. The consummation of the Merger is subject to the approval of
Mafco stockholders, the filing with and review by the Securities and
Exchange Commission of an information statement to be sent to Mafco
stockholders, and other customary conditions. Mafco Consolidated
Holdings, which owns approximately 85% of the outstanding shares of
Common stock, has agreed to vote in favor of the transaction. The Merger
is expected to close during the second quarter of 1997.
A copy of the Merger Agreement is attached hereto as
Exhibit 6 and is incorporated herein by reference. The foregoing summary
of the Merger Agreement does not purport to be complete and is qualified
in its entirety by reference to the provisions of such agreement.
Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities of the Issuer.
Item 6 is hereby amended as follows:
The information set forth in Item 4 is hereby incorporated
by reference.
Item 7. Material to be Filed as Exhibits.
Item 7 is hereby amended to add the following at the end
thereof:
Exhibit 6. Agreement and Plan of Merger, dated
February 20, 1997, by and among
Mafco Consolidated Group Inc., Mafco
Consolidated Holdings Inc. and MCG
Acquisition Inc.
SIGNATURES
After reasonable inquiry and to the best of my knowledge
and belief, I certify that the information in this statement is true,
complete and correct.
Dated: February 24, 1997
MAFCO HOLDINGS INC.
MAFCO CONSOLIDATED HOLDINGS INC.
By: /s/ Barry F. Schwartz
Name: Barry F. Schwartz
Title: Executive Vice President
Exhibit Index
Exhibit 6: Agreement and Plan of Merger, dated
February 20, 1997, by and among Mafco Con-
solidated Group Inc., Mafco Consolidated
Holdings Inc. and MCG Acquisition Inc.
AGREEMENT AND PLAN OF MERGER
by and among
MAFCO CONSOLIDATED GROUP INC.,
MAFCO CONSOLIDATED HOLDINGS INC.
and
MCG ACQUISITION INC.
dated as of
February 20, 1997
TABLE OF CONTENTS
ARTICLE I
THE MERGER
Section 1.1 The Merger..................................... 1
Section 1.2 Effective Time................................. 2
Section 1.3 Closing........................................ 2
Section 1.4 Certificate of Incorporation;
By-Laws............................................... 2
Section 1.5 Directors and Officers of the
Surviving Corporation................................. 3
ARTICLE II
CONVERSION OF SHARES
Section 2.1 Conversion of Capital Stock.................... 3
Section 2.2 Exchange of Certificates....................... 4
Section 2.3 Company Stock Options.......................... 6
Section 2.4 Dissenter's Rights............................. 7
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Section 3.1 Organization................................... 7
Section 3.2 Capitalization................................. 8
Section 3.3 Authorization; Validity of
Agreement............................................. 9
Section 3.4 No Violations; Consents and
Approvals............................................. 10
Section 3.5 SEC Reports and Financial
Statements............................................ 11
Section 3.6 Information Statement; Schedule
13E-3................................................. 12
Section 3.7 Opinion of Financial Advisor................... 12
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT
AND THE PURCHASER
Section 4.1 Organization................................... 13
Section 4.2 Authorization; Validity of
Agreement............................................. 13
Section 4.3 Consents and Approvals; No
Violations............................................ 14
Section 4.4 Information in Information
Statement; Schedule 13E-3............................. 15
ARTICLE V
COVENANTS
Section 5.1 Interim Operations of the Company.............. 16
Section 5.2 Further Action; Reasonable Efforts............. 16
Section 5.3 Action by Written Consent;
Information Statement................................. 17
Section 5.4 Notification of Certain Matters............... 18
Section 5.5 Publicity...................................... 19
Section 5.6 Directors' and Officers' Insurance
and Indemnification................................... 19
Section 5.7 Brokers or Finders............................. 19
ARTICLE VI
CONDITIONS
Section 6.1 Conditions to Each Party's Obligation
To Effect the Merger.................................. 20
Section 6.2 Conditions to the Obligation of
the Company to Effect the Merger...................... 20
Section 6.3 Conditions to Obligations of
Parent and the Purchaser to Effect the Merger......... 21
ARTICLE VII
TERMINATION
Section 7.1 Termination.................................... 22
Section 7.2 Effect of Termination.......................... 23
ARTICLE VIII
MISCELLANEOUS
Section 8.1 Fees and Expenses.............................. 23
Section 8.2 Amendment; Waiver; Termination................. 23
Section 8.3 Nonsurvival of Representations and
Warranties............................................ 25
Section 8.4 Notices........................................ 25
Section 8.5 Interpretation................................. 26
Section 8.6 Headings....................................... 26
Section 8.7 Counterparts................................... 26
Section 8.8 Entire Agreement; No Third Party
Beneficiaries; Rights of Ownership.................... 26
Section 8.9 Severability................................... 27
Section 8.10 Governing Law................................. 27
Section 8.11 Assignment.................................... 27
TABLE OF DEFINED TERMS
Acquisition Proposal.............................................. 17
affiliates........................................................ 26
Applicable Amount................................................. 6
beneficial ownership.............................................. 26
Board ..............................................................9
By-laws........................................................... 2
Certificate of Incorporation...................................... 2
Certificate of Merger............................................. 2
Certificates...................................................... 4
Cigar Common Stock................................................ 3
Cigar Secondary Offering.......................................... 8
Closing........................................................... 2
Closing Date...................................................... 2
Company........................................................... 1
Company Common Stock.............................................. 3
Company SEC Documents............................................. 11
Consolidated Cigar................................................ 3
DGCL ............................................................ 1
Dissenting Shares................................................. 6
Effective Time.................................................... 2
Exchange Act...................................................... 10
GAAP ............................................................ 11
Governmental Entity............................................... 10
include............................................................26
Information Statement............................................. 18
Laws.............................................................. 10
made available.....................................................26
Material Adverse Effect........................................... 7
Merger............................................................ 1
Merger Consideration.............................................. 4
Parent............................................................ 1
Paying Agent...................................................... 4
Person............................................................ 8
Public Subsidiary................................................. 8
Purchaser......................................................... 1
Purchaser Common Stock............................................ 3
Preferred Stock.....................................................8
Schedule 13E-3.................................................... 12
SEC ............................................................ 4
Secretary of State................................................ 2
Securities Act.................................................... 11
Shares............................................................ 3
Special Committee................................................. 1
Stock Option...................................................... 6
Surviving Corporation............................................. 1
Subsidiary........................................................ 8
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of February 20, 1997, by
and among Mafco Consolidated Group Inc., a Delaware corporation (the
"Company"), Mafco Consolidated Holdings Inc., a Delaware corporation
("Parent"), and MCG Acquisition Inc., a wholly owned subsidiary of Parent
and a Delaware corporation (the "Purchaser").
WHEREAS, the Boards of Directors of Parent and the Purchaser
and the Board of Directors of the Company, upon the recommendation of its
special committee (the "Special Committee"), have each approved, and deem
it advisable and in the best interests of their respective stockholders to
consummate, the acquisition of the Company by Parent upon the terms and
subject to the conditions set forth herein; and
WHEREAS, in furtherance of such acquisition, the Boards of
Directors of Parent, the Purchaser and the Company and Parent as the sole
stockholder of the Purchaser have each approved this Agreement and the
merger of the Purchaser with and into the Company in accordance with the
terms, and subject to the conditions, of this Agreement and in accordance
with the General Corporation Law of the State of Delaware (the "DGCL");
NOW, THEREFORE, in consideration of the foregoing and the
respective representations, warranties, covenants and agreements set forth
herein, the parties hereto agree as follows:
ARTICLE I
THE MERGER
Section 1.1 The Merger. Upon the terms and subject to the
conditions of this Agreement and in accordance with the DGCL, at the
Effective Time (as defined in Section 1.2 hereof), the Purchaser shall be
merged with and into the Company (the "Merger") and the separate corporate
existence of the Purchaser shall cease. After the Merger, the Company shall
continue as the surviving corporation (sometimes hereinafter referred to as
the "Surviving Corporation"). The Merger shall have the effect as provided
in the applicable provisions of the DGCL. Without limiting the generality
of the foregoing, upon the Merger, all the rights, privileges, immunities,
powers and franchises of the Company and the Purchaser shall vest in the
Surviving Corporation and all obligations, duties, debts and liabilities of
the Company and the Purchaser shall be the obligations, duties, debts and
liabilities of the Surviving Corporation.
Section 1.2 Effective Time. On or as promptly as practicable
following the Closing Date (as defined in Section 1.3), the Purchaser and
the Company will cause an appropriate Certificate of Merger (the
"Certificate of Merger") to be executed and filed with the Secretary of
State of the State of Delaware (the "Secretary of State") in such form and
executed as provided in the DGCL. The Merger shall become effective on the
date on which the Certificate of Merger has been duly filed with the
Secretary of State or such time as is agreed upon by the parties and
specified in the Certificate of Merger, and such time is hereinafter
referred to as the "Effective Time."
Section 1.3 Closing. The closing of the Merger (the "Closing")
will take place at 10:00 a.m., New York time, on a date to be specified by
the parties, which shall be no later than the second business day after
satisfaction or waiver of all of the conditions set forth in Article VI
hereof (the "Closing Date"), at the offices of Skadden, Arps, Slate,
Meagher & Flom LLP, 919 Third Avenue, New York, New York 10022-3897, unless
another date, time or place is agreed to in writing by the parties hereto.
Section 1.4 Certificate of Incorporation; ByLaws. Pursuant to
the Merger, (x) the certificate of incorporation of the Company, as
amended, as in effect immediately prior to the Effective Time (the
"Certificate of Incorporation"), shall be amended as set forth in Exhibit A
hereto and such Certificate of Incorporation, as so amended at the
Effective Time, shall be the certificate of incorporation of the Surviving
Corporation until thereafter amended in accordance with applicable law and
(y) the by-laws of the Purchaser, as in effect immediately prior to the
Effective Time (the "By-laws"), shall be the by-laws of the Surviving
Corporation until thereafter amended in accordance with applicable law.
Section 1.5 Directors and Officers of the Surviving
Corporation. The directors and officers of the Purchaser immediately prior
to the Effective Time shall, from and after the Effective Time, be the
directors and officers of the Surviving Corporation until their successors
shall have been duly elected or appointed and qualified or until their
earlier death, resignation or removal in accordance with the Surviving
Corporation's certificate of incorporation and by-laws.
ARTICLE II
CONVERSION OF SHARES
Section 2.1 Conversion of Capital Stock. As of the Effective
Time, by virtue of the Merger and without any action on the part of the
holders of any shares of common stock, par value $.0l per share, of the
Company (referred to herein as "Shares" or "Company Common Stock") or the
common stock, par value $.01 per share, of the Purchaser (the "Purchaser
Common Stock"):
(a) Each issued and outstanding share of Company Common Stock
(other than Shares to be cancelled in accordance with Section 2.1(c) and
other than Dissenting Shares covered by Section 2.4) shall be converted
into the right to receive the sum of:
(x) $33.50; and
(y) if the average of the per share closing prices of the
common stock, par value $.01 per share ("Cigar Common Stock"), of
Consolidated Cigar Holdings Inc., a Delaware corporation and a subsidiary
of the Company ("Consolidated Cigar"), on the New York Stock Exchange for
the ten trading days ending two trading days prior to effectiveness of the
action by written consent contemplated by Section 5.3 hereof (the
"Average") exceeds $33 (the amount by which the Average exceeds $33, the
"Excess"), then
(i) if the Company shall not have sold shares of Cigar
Common Stock in the Cigar Secondary Offering (as defined in Section
3.2 hereof) or shall have sold shares of Cigar Common Stock in the
Cigar Secondary Offering at a gross sales price per share in excess of
$33, an amount equal to the Excess, or
(ii) if the Company shall have sold shares of Cigar
Common Stock in the Cigar Secondary Offering at a gross sales price
per share of $33 or less, an amount equal to the Excess multiplied by
a fraction, the numerator of which shall be the number of shares of
Cigar Common Stock beneficially owned by the Company immediately
following, and the denominator of which shall be the number of shares
of Cigar Common Stock beneficially owned by the Company immediately
prior to, the consummation of the Offering ((x) and (y), collectively,
the "Merger Consideration").
All such shares of Company Common Stock, when so converted, shall no longer
be outstanding and shall automatically be cancelled and retired and shall
cease to exist, and each holder of a certificate representing any such
Shares shall cease to have any rights with respect thereto, except the
right to receive the Merger Consideration therefor upon the surrender of
such certificate in accor- dance with Section 2.2. Any payment made
pursuant to this Section 2.1(a) shall be made net of applicable withholding
taxes to the extent such withholding is required by law.
(b) Each issued and outstanding share of the Purchaser Common
Stock shall be converted into and become one fully paid and nonassessable
share of common stock of the Surviving Corporation.
(c) All shares of Company Common Stock that are held by the
Company as treasury stock and any shares of Company Common Stock owned by
Parent, the Purchaser or any other subsidiary of Parent shall be cancelled
and retired and shall cease to exist and no Merger Consideration shall be
delivered in exchange therefor.
Section 2.2 Exchange of Certificates.
(a) Prior to the Effective Time, Parent shall designate a bank
or trust company to act as agent for the holders of the Shares in
connection with the Merger (the "Paying Agent") to receive the funds, as
needed, to which holders of the Shares shall become entitled pursuant to
Section 2.1(a). Such funds shall be invested by the Paying Agent as
directed by Parent or the Surviving Corporation. All interest earned on
such funds shall be paid to Parent.
(b) At the Effective Time, Parent will instruct the Paying
Agent to promptly, and in any event not later than three business days
following the Effective Time, mail to each holder of record of a
certificate or certificates, which immediately prior to the Effective Time
represented outstanding shares of Company Common Stock (the
"Certificates"), whose Shares were converted pursuant to Section 2.1(a)
into the right to receive the Merger Consideration (i) a letter of
transmittal (which shall specify that delivery shall be effected, and risk
of loss and title to the Certificates shall pass, only upon delivery of the
Certificates to the Paying Agent and shall be in such form and have such
other provisions as Parent and the Company may reasonably specify) and (ii)
instructions for use in effecting the surrender of the Certificates in
exchange for payment of the Merger Consideration. Upon surrender of a
Certificate for cancellation to the Paying Agent or to such other agent or
agents as may be appointed by the Company, together with such letter of
transmittal, duly executed, the holder of such Certificate shall be
entitled to receive in exchange therefor the Merger Consideration for each
share of Company Common Stock formerly represented by such Certificate, to
be mailed within three business days of receipt thereof, and the
Certificate so surrendered shall forthwith be cancelled. If payment of the
Merger Consideration is to be made to a person other than the person in
whose name the surrendered Certificate is registered, it shall be a
condition of payment that the Certificate so surrendered shall be properly
endorsed or shall be otherwise in proper form for transfer and that the
person requesting such payment shall have paid any transfer and other taxes
required by reason of the payment of the Merger Consideration to a person
other than the registered holder of the Certificate surrendered or shall
have established to the satisfaction of the Surviving Corporation that such
tax either has been paid or is not applicable. Until surrendered as
contemplated by this Section 2.2, each Certificate (other than Certificates
representing Company Common Stock held by Parent or the Purchaser, or any
subsidiary of Parent or the Purchaser, or Dissenting Shares (as defined in
Section 2.4)) shall be deemed at any time after the Effective Time to
represent only the right to receive the Merger Consideration as
contemplated by this Section 2.2.
(c) In the event any Certificate shall have been lost, stolen
or destroyed, upon the making of an affidavit of that fact by the Person
(as defined in Section 3.1) claiming such Certificate to be lost, stolen or
destroyed, the Paying Agent will issue in exchange for such lost, stolen or
destroyed Certificate the Merger Consideration deliverable in respect
thereof as determined in accordance with this Article II, provided that the
Person to whom the Merger Consideration is paid shall, as a condition
precedent to the payment thereof, give the Surviving Corporation a bond in
such sum as it may direct or otherwise indemnify the Surviving Corporation
in a manner satisfactory to it against any claim that may be made against
the Surviving Corporation with respect to the Certificate claimed to have
been lost, stolen or destroyed.
(d) After the Effective Time, the stock transfer books of the
Company shall be closed and there shall be no transfers on the stock
transfer books of the Surviving Corporation of Shares which were
outstanding immediately prior to the Effective Time. If, after the
Effective Time, Certificates are presented to the Surviving Corporation,
they shall be cancelled and exchanged for the Merger Consideration as
provided in this Article II.
Section 2.3 Company Stock Options. Except as Parent or the
Purchaser and the holder of any option ("Stock Option") to purchase Company
Common Stock otherwise agree, the Company shall take all actions necessary
to provide that, upon the Effective Time, (i) each outstanding Stock
Option, whether or not then exercisable or vested, shall become fully
exercisable and vested, (ii) each outstanding Stock Option shall be
cancelled and (iii) in consideration of such cancellation the Company shall
pay to the holder of each Stock Option an amount in respect thereof equal
to the product of (A) the Applicable Amount, multiplied by (B) the number
of shares subject thereto; provided that the foregoing shall not require
any action which violates any agreement in effect in respect thereof. The
term "Applicable Amount" shall mean the excess, if any, of (A) the sum of
(x) the dividend referred to in Section 6.2(c) and (y) the Merger
Consideration over (B) the applicable exercise price of each such Stock
Option.
Section 2.4 Dissenter's Rights. Notwithstanding anything in
this Agreement to the contrary, Shares outstanding immediately prior to the
Effective Time and held by a holder who has not voted in favor of the
Merger or consented thereto in writing and who has delivered a written
demand for appraisal of such shares in accordance with Section 262 of the
DGCL ("Dissenting Shares"), shall not be converted into the right to
receive the Merger Consideration, as provided in Section 2.1(a) hereof,
unless and until such holder fails to perfect or effectively withdraws or
otherwise loses his right to appraisal and payment under the DGCL. If,
after the Effective Time, any such holder fails to perfect or effectively
withdraws or loses his right to appraisal, such Dissenting Shares shall
thereupon be treated as if they had been converted as of the Effective Time
into the right to receive the Merger Consideration to which such holder is
entitled, without interest or dividends thereon. The Company shall give the
Purchaser prompt notice of any demands received by the Company for
appraisal of Shares, and, prior to the Effective Time, the Purchaser shall
have the right to participate in all negotiations and proceedings with
respect to such demands. Prior to the Effective Time, the Company shall
not, except with the prior written consent of the Purchaser, make any
payment with respect to or offer to settle, any such demands.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Parent and the
Purchaser, as of the date hereof and as of and at the Closing Date, except
as disclosed in the Company SEC Documents (as defined in Section 3.5), as
follows:
Section 3.1 Organization. Each of the Company and its Public
Subsidiaries (as defined below) is a corporation duly organized, validly
existing, and in good standing under the laws of Delaware, and has all
requisite corporate power and authority to own, lease, use and operate its
properties and to carry on its business as it is now being conducted. Each
of the Company and its Public Subsidiaries is qualified or licensed to do
business as a foreign corporation and is in good standing in each
jurisdiction in which it owns real property or in which the nature of the
business conducted by it makes such qualification or licensing necessary,
except where the failure to be so qualified or licensed individually and in
the aggregate would not have or result in a Material Adverse Effect. The
term "Material Adverse Effect" means a material adverse effect on the
business, assets, liabilities, results of operations or financial condition
of the Company, its Public Subsidiaries and their respective Subsidiaries,
taken as a whole. None of the Company or any of its Public Subsidiaries is
in breach or violation of any of its certificate of incorporation, by-laws
or other organizational documents. The term "Public Subsidiary" means
Consolidated Cigar and Power Control Technologies, Inc. The term
"Subsidiary" means, with respect to any Person, any corporation or other
entity of which 50% or more of the securities or other interests having by
their terms ordinary voting power for the election of directors or others
performing similar functions with respect to such entity is directly or
indirectly owned by such Person. The term "Person" means any natural
person, firm, individual, partnership, joint venture, business trust,
trust, association, corporation, company, unincorporated entity or
Governmental Entity (as defined in Section 3.4(b)).
Section 3.2 Capitalization.
(a) The authorized capital stock of the Company consists of
250,000,000 shares of Company Common Stock and 100,000,000 preferred
shares, par value $.01 per share (the "Preferred Stock"). The number of
shares of Company Common Stock issued and outstanding is 23,224,307 shares
on the date hereof. There are 1,484,850 shares of Company Common Stock
issued and held in the treasury of the Company, and there are no shares of
Preferred Stock issued and outstanding. All the outstanding shares of the
Company's capital stock are duly authorized, validly issued, fully paid and
nonassessable. Except as dis- closed in the Company SEC Documents or
pursuant to the Stock Options or the offering by the Company of shares of
Cigar Common Stock (the "Cigar Secondary Offering") to be made pursuant to
a registration statement on Form S-1 filed by Consolidated Cigar with the
Securities and Exchange Commission (the "SEC"), there are no existing (i)
options, warrants, calls, preemptive rights, sub- scriptions or other
rights, convertible securities, agreements or commitments of any character
obligating the Company or any of its Subsidiaries to issue, transfer or
sell any shares of capital stock or other equity interest in, the Company
or any of its Subsidiaries or securities convertible into or exchangeable
for such shares or equity interests, (ii) contractual obligations of the
Company or any of its Subsidiaries to repurchase, redeem or otherwise
acquire any capital stock of the Company or any of its Subsidiaries or
(iii) voting trusts or similar agreements to which the Company or any of
its Subsidiaries is a party with respect to the voting of the capital stock
of the Company or any of its Subsidiaries.
Section 3.3 Authorization; Validity of Agreement.
(a) The Company has the requisite corporate power and authority
to execute and deliver this Agreement and, subject to approval of its
stockholders as contemplated by Section 5.3 hereof, to consummate the
transactions contemplated hereby. The execution, delivery and performance
by the Company of this Agreement and the consummation by the Company of the
transactions contemplated hereby have been duly authorized by the Board of
Directors of the Company (the "Board") and, other than approval and
adoption of this Agreement by the holders of a majority of the outstanding
shares of Company Common Stock, no other corporate proceedings on the part
of the Company are necessary to authorize the execution, delivery and
performance of this Agreement by the Company and the consummation by the
Company of the transactions contemplated hereby. This Agreement has been
duly executed and delivered by the Company and, assuming due authorization,
execution and delivery of this Agreement by Parent and the Purchaser, is a
valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms, except that such enforcement may be
subject to or limited by (i) bankruptcy, insolvency or other similar laws,
now or hereafter in effect, affecting creditors' rights generally, and (ii)
the effect of general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity).
(b) The provisions of Section 203 of the DGCL are inapplicable
to the transactions contemplated by this Agreement.
Section 3.4 No Violations; Consents and Approvals.
(a) Neither the execution, delivery and performance of this
Agreement by the Company nor the consummation by the Company of the
transactions contemplated hereby will (i) violate any provision of the
certificate of incorporation or by-Laws of the Company or its Public
Subsidiaries, (ii) conflict with, 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, amendment, cancellation or
acceleration or to the imposition of any lien) under, or result in the
acceleration or trigger of any payment, time of payment, vesting or
increase in the amount of any compensation or benefit payable pursuant to,
the terms, conditions or provisions of any note, bond, mortgage, indenture,
guarantee or other evidence of indebtedness, lease, license, contract,
agreement, plan or other instrument or obligation to which the Company or
any of its Public Subsidiaries is a party or by which any of them or any of
their assets may be bound or (iii) conflict with or violate any federal,
state, local or foreign order, writ, injunction, judgment, award, decree,
statute, law, rule or regulation (collectively, "Laws") applicable to the
Company, any of its Public Subsidiaries or any of their properties or
assets; except in the case of clauses (ii) or (iii) for such conflicts,
violations, breaches, defaults or liens which individually and in the
aggregate would not have or result in a Material Adverse Effect or
materially impair or delay the consummation of the transactions
contemplated hereby.
(b) No filing or registration with, declaration or notification
to, or order, authorization, consent or approval of, any federal, state,
local or foreign court, legislative, executive or regulatory authority or
agency (a "Governmental Entity") or any other Person is required in
connection with the execution, delivery and performance of this Agreement
by the Company or the consummation by the Company of the transactions
contemplated hereby, except (i) applicable requirements under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), (ii) the
filing of the Certificate of Merger with the Secretary of State and (iii)
such other consents, approvals, orders, authorizations, notifications,
registrations, declarations and filings the failure of which to be obtained
or made individually and in the aggregate would not have or result in a
Material Adverse Effect or materially impair or delay the consummation of
the transactions contemplated hereby.
Section 3.5 SEC Reports and Financial Statements. The Company
has filed with the SEC, all forms and documents required to be filed by it
since January 1, 1994 under the Exchange Act and has heretofore made
available to Parent (i) its Annual Reports on Form 10-K for the years ended
December 31, 1993, December 31, 1994 and December 31, 1995, respectively,
and (ii) all proxy statements relating to meetings of stockholders of the
Company since January 1, 1994 and (iii) all other forms, reports and
registration statements filed by the Company with the SEC since January 1,
1994. The documents described in clauses (i)-(iii) above (whether filed
before, on or after the date hereof) are referred to in this Agreement
collectively as the "Company SEC Documents". As of their respective dates,
the Company SEC Documents (a) did not contain any untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading and (b)
complied in all material respects with the applicable requirements of the
Exchange Act and the Securities Act of 1933 (the "Securi- ties Act"), as
the case may be, and the applicable rules and regulations of the SEC
thereunder. The consolidated financial statements included in the Company
SEC Documents have been prepared in accordance with United States generally
accepted accounting principles ("GAAP") applied on a consistent basis
during the periods involved and fairly present the consolidated financial
position and the consolidated results of operations and cash flows of the
Company and its consolidated Subsidiaries as of and at the dates thereof or
for the periods presented therein.
Section 3.6 Information Statement; Schedule 13E-3.
(a) The Information Statement (as defined in Section 5.3(b))
(and any amendment thereof or supplement thereto), at the date mailed to
stockholders of the Company and at the Effective Time, (i) will not contain
any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they are made, not
mislead- ing and (ii) will comply in all material respects with the
provisions of the Exchange Act and the rules and regulations thereunder;
except that no representation is made by the Company with respect to
statements made in the Information Statement based on information supplied
by Parent or the Purchaser specifically for inclusion therein.
(b) The information provided by the Company specifically for
use in any Rule 13e-3 Transaction Statement on Schedule 13E-3 required to
be filed with the SEC under the Exchange Act and mailed to the stockholders
of the Company in connection with the Merger (the "Schedule 13E-3") (and
any amendment thereto or supplement thereof), at the date filed with the
SEC and at the time mailed to the stockholders of the Company, will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make
the statements therein, in light of the circumstances under which they are
made, not misleading.
Section 3.7 Opinion of Financial Advisor. The Company has
received an opinion of Morgan Stanley & Co. Incorporated to the effect
that, as of the date hereof, the Merger Consideration to be received by the
holders of Shares (other than Parent and its affiliates) in the Merger is
fair, from a financial point of view, to such holders.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT
AND THE PURCHASER
Parent and the Purchaser represent and warrant to the Company,
as of the date hereof and as of and at the Closing Date, as follows:
Section 4.1 Organization. Each of Parent and the Purchaser is a
corporation duly organized, validly existing and in good standing under the
laws of Delaware. Each of Parent and the Purchaser has all requisite corpo-
rate power and authority to own, lease, use and operate its properties and
to carry on its business as it is now being conducted. Each of Parent and
the Purchaser is qualified or licensed to do business as a foreign
corporation and is in good standing in each jurisdiction in which it owns
real property or in which the nature of the business conducted by it makes
such qualification or licensing necessary, except where the failure to be
so qualified or licensed individually and in the aggregate would not have
or result in a material adverse effect on the business, assets,
liabilities, results of operations or financial condition of Parent and the
Purchaser, taken as a whole.
Section 4.2 Authorization; Validity of Agreement. Each of
Parent and the Purchaser has the requisite corporate power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby. The execution, delivery and performance by Parent and
the Purchaser of this Agreement and the consummation by Parent and the
Purchaser of the transactions contemplated hereby have been duly authorized
by the respective Boards of Directors of Parent and the Purchaser and by
Parent as the sole stockholder of Purchaser and no other corporate
proceedings on the part of Parent or the Purchaser are necessary to
authorize the execution, delivery and performance of this Agreement by
Parent and the Purchaser and the consummation by Parent and the Purchaser
of the transactions contemplated hereby. This Agreement has been duly
executed and delivered by Parent and the Purchaser and, assuming due
authorization, execution and delivery of this Agreement by the Company, is
a valid and binding obligation of each of Parent and the Purchaser,
enforceable against each of them in accordance with its terms, except that
such enforcement may be subject to or limited by (i) bankruptcy, insolvency
or other similar laws, now or hereafter in effect, affecting creditors'
rights generally, and (ii) the effect of general principles of equity
(regardless of whether enforceability is considered in a proceeding at law
or in equity). Parent is the legal and beneficial owner of 19,777,752
Shares, all of which Parent has the right to vote with respect to the
transaction contemplated hereby.
Section 4.3 Consents and Approvals; No Violations.
(a) Neither the execution, delivery and performance of this
Agreement by Parent and the Purchaser nor the consummation by Parent and
the Purchaser of the transactions contemplated hereby will (i) violate any
provision of the respective certificate of incorporation or by-laws of
Parent or the Purchaser, (ii) conflict with, 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, amendment,
cancellation or acceleration or to the imposition of any lien) under, or
result in the acceleration or trigger of any payment, time of payment,
vesting or increase in the amount of any compensation or benefit payable
pursuant to, the terms, conditions or provisions of any note, bond,
mortgage, indenture, guarantee or other evidence of indebtedness, lease,
license, contract, agreement, plan or other instrument or obligation to
which Parent or the Purchaser is a party or by which any of them or any of
their assets may be bound or (iii) conflict with or violate any Laws
applicable to Parent, the Purchaser or any of their properties or assets;
except in the case of clauses (ii) and (iii) for such conflicts,
violations, breaches, defaults or liens which individually and in the
aggregate would not have or result in a material adverse effect on the
business, results of operations or financial condition of Parent and the
Purchaser, taken as a whole, or materially impair or delay the consummation
of the transactions contemplated hereby.
(b) No filing or registration with, declaration or notification
to, or order, authorization, consent or approval of, any Governmental
Entity is required in connection with the execution, delivery and
performance of this Agreement by Parent or the Purchaser or the
consummation by Parent or the Purchaser of the transactions contemplated
hereby, except (i) applicable requirements under the Exchange Act, (ii) the
filing of the Certificate of Merger with the Secretary of State and (iii)
such other consents, approvals, orders, authorizations, notifications,
registrations, declarations and filings the failure of which to be obtained
or made individually and in the aggregate would not have a material adverse
effect on the business, results of operations or financial condition of
Parent and the Purchaser, taken as a whole, or materially impair or delay
the consummation of the transactions contemplated hereby.
Section 4.4 Information in Information Statement; Schedule
13E-3.
(a) The information supplied in writing by Parent or the
Purchaser specifically for inclusion in the Information Statement (and any
amendment thereof or supplement thereto), at the date mailed to
stockholders of the Company and at the Effective Time, will not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they are made, not
misleading.
(b) The Schedule 13E-3 (and any amendment thereto or supplement
thereof,) at the date filed with the SEC and at the time mailed to
stockholders of the Company, (i) will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading and (ii) will
comply in all material respects with the provisions of the Exchange Act and
the rules and regulations thereunder; except that no representation is made
by Parent or the Purchaser with respect to statements made in the Schedule
13E-3 based on information supplied by the Company specifically for
inclusion therein.
ARTICLE V
COVENANTS
Section 5.1 Interim Operations of the Company. The Company
covenants and agrees that, except (i) as expressly contemplated by this
Agreement or (ii) as agreed to in writing by Parent and the Purchaser,
after the date hereof and prior to the Effective Time, the business of the
Company, its Public Subsidiaries and their Subsidiaries shall be conducted
only in the ordinary and usual course, and, in particular: the Company will
not, directly or indirectly, (a) sell, transfer or pledge or agree to sell,
transfer or pledge any of the Shares or capital stock of its Subsidiaries
beneficially owned by it (other than pursuant to the Cigar Secondary
Offering); (b) amend its Certificate of Incorporation or By-laws; (c)
split, combine or reclassify the outstanding Shares; (d) declare, set aside
or pay any dividend or other distribution payable in cash, stock or
property with respect to its capital stock (other than a special cash
dividend in the amount of $10 per share of Company Common Stock); or (e)
redeem, purchase or otherwise acquire directly or indirectly any of its
capital stock.
Section 5.2 Further Action; Reasonable Efforts.
(a) Upon the terms and subject to the conditions herein
provided, each of the parties hereto shall use its reasonable efforts to
take, or cause to be taken, all action 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, including using reasonable efforts to satisfy the conditions
precedent to the obligations of any of the parties hereto, to obtain all
necessary authorizations, consents and approvals, and to effect all
necessary registrations and filings. Each of the parties hereto shall
promptly consult with the other parties with respect to, provide any
necessary information that is not subject to legal privilege with respect
to, and provide the other parties (or their counsel) copies of, all filings
made by such party with any Governmental Entity or any other information
supplied by such party to a Governmental Entity in connection with this
Agreement and the transactions contemplated hereby. Each of the parties
hereto shall promptly inform the other of any communication from any
Governmental Entity regarding any of the transactions contemplated by this
Agreement. If such party receives a request from any such Governmental
Entity with respect to the transactions contemplated by this Agreement,
then such party will endeavor in good faith to make, or cause to be made,
as soon as reasonably practicable and after consultation with the other
parties, an appropriate response in compliance with such request.
(b) Parent, the Purchaser and the Company shall use their
respective reasonable efforts to resolve such objections, if any, as may be
asserted with respect to the transactions contemplated hereby under the
laws, rules, guidelines or regulations of any Governmental Entity.
Section 5.3 Action by Written Consent; Information Statement.
(a) As promptly as practicable after the date hereof, Parent
will (i) vote, or cause to be voted, by written consent, all of the Shares
owned by it or the Purchaser in favor of the approval and adoption of this
Agreement and the transactions contemplated hereby and (ii) provide the
Company with all information concerning Parent or the Purchaser necessary
or reasonably appropriate to be included in the Information Statement.
(b) As promptly as practicable after the date hereof, the
Company shall prepare and file with the SEC, and Parent and the Purchaser
shall cooperate with the Company in such preparation and filing, a
preliminary information statement relating to this Agreement and the
transactions contemplated hereby and use its best efforts to furnish the
information required to be included by the SEC in the Information Statement
and, after consultation with Parent, to respond promptly to any comments
made by the SEC with respect to the preliminary information statement and
cause a definitive Information Statement (the "Information Statement") to
be mailed to its stock- holders.
(c) The Company, Parent and Purchaser shall cooperate with one
another in the preparation and filing of the Schedule 13E-3 and shall use
all reasonable efforts to promptly obtain and furnish the information
required to be included in the Schedule 13E-3 and to respond promptly to
any comments or requests made by the SEC with respect to the Schedule
13E-3. Each party hereto shall promptly notify the other parties of the
receipt of comments of, or any requests by, the SEC with respect to the
Schedule 13E-3, and shall promptly supply the other parties with copies of
all correspondence between such party (or its representatives) and the SEC
(or its staff) relating thereto. The Company, Parent and Purchaser each
shall correct any information provided by it for use in the Schedule 13E-3
which shall have become, or is, false or misleading.
Section 5.4 Notification of Certain Matters.
(a) The Company shall give prompt notice to Parent and Parent
shall give prompt notice to the Company, of (i) the occurrence or
nonoccurrence of any event the occurrence or nonoccurrence of which would
cause any representation or warranty of the Company, or of Parent and the
Purchaser, as the case may be, contained in this Agreement to be untrue or
inaccurate in any material respect at the Effective Time and (ii) any
material failure of the Company, or Parent or the Purchaser, as the case
may be, to comply with or satisfy any covenant, condition or agreement to
be complied with or satisfied by it hereunder.
(b) If at any time prior to the Effective Time any event or
circumstance relating to the Company or any of its Subsidiaries or
affiliates, or their respective officers or directors, should be discovered
by the Company that is required to be set forth in a supplement to the
Information Statement, the Company shall promptly inform Parent and the
Purchaser, so supplement the Information Statement and mail such supplement
to its stockholders. If at any time prior to the Effective Time any event
or circumstance relating to Parent or the Purchaser or their respective
officers or directors, should be discovered by Parent that is required to
be set forth in a supplement to the Information Statement, Parent shall
promptly inform the Company; and upon receipt of such information the
Company shall promptly supplement the Information Statement and mail such
supplement to its stockholders.
Section 5.5 Publicity. Neither the Company, Parent nor any of
their respective affiliates shall issue or cause the publication of any
press release or other announcement with respect to the Merger, this
Agreement or the other transactions contemplated hereby without the prior
consultation of the other party, except as may be required by law or by any
listing agreement with a national securities exchange if all reasonable
efforts have been made to consult with the other party.
Section 5.6 Directors' and Officers' Insurance and
Indemnification. (a) Parent shall cause the Surviving Corporation (or any
successor to the Surviving Corporation) to indemnify, defend and hold
harmless the present and former officers, directors, employees and agents
of the Company and its Subsidiaries against all losses, claims, damages,
liabilities, fees and expenses arising out of actions or omissions
occurring at or prior to the Effective Time to the fullest extent permitted
under Delaware law as in effect at the date hereof.
(b) Parent or the Surviving Corporation shall maintain the
Company's existing officers' and directors' liability insurance for a
period of not less than 7 years after the Effective Time; provided, that
the Parent may substitute therefor policies of substantially similar
coverage and amounts containing terms no less favorable to such former
directors or officers; provided, further, that in no event shall Parent or
the Surviving Corporation be required to pay annual premiums for insurance
under this Section in excess of that which is commercially reasonably; and
provided further, however, that if the annual premiums for such insurance
coverage exceed that which is commercially reasonable, Parent or the
Surviving Corporation shall be obligated to obtain a policy with the
greatest coverage at a cost which is commercially reasonable.
Section 5.7 Brokers or Finders. Each of Parent and the Company
represents, as to itself, its Subsidiaries and its affiliates (other, than
in the case of Parent, the Company and its Subsidiaries, and in the case of
the Company, Parent or any of its affiliates, other than the Company and
its Subsidiaries), that no agent, broker, investment banker, financial
advisor or other firm or person is or will be entitled to any brokers' or
finders' fee or any other commission or similar fee in connection with any
of the transactions contemplated by this Agreement and each of Parent and
the Company shall indemnify and hold the other harmless from and against
any and all claims, liabilities or obligations with respect to any other
fees, commissions or expenses asserted by any person on the basis of any
act or statement alleged to have been made by such party or its affiliates.
ARTICLE VI
CONDITIONS
Section 6.1 Conditions to Each Party's Obligation To Effect the
Merger. The respective obligation of each party to effect the Merger shall
be subject to the satisfaction on or prior to the Closing Date of each of
the following conditions (any or all of which may be waived by the parties
hereto in writing, in whole or in part, to the extent permitted by
applicable law):
(a) No statute, rule, regulation, order, decree or injunction
shall have been enacted, entered, promulgated or enforced by a Governmental
Entity which prohibits the consummation of the Merger and shall be in
effect, and no proceeding which has a reasonable probability of resulting
in such relief shall be pending;
(b) Other than filing the Certificate of Merger in accordance
with the DGCL, all authorizations, consents and approvals required to be
obtained prior to consummation of the Merger shall have been obtained,
except for such authorizations, consents, and approvals the failure of
which to be obtained individually and in the aggregate would not have or
result in a Material Adverse Effect; and
(c) This Agreement shall have been approved and adopted by the
affirmative vote of the holders of a majority of the outstanding shares of
Company Common Stock.
Section 6.2 Conditions to the Obligation of the Company to
Effect the Merger. The obligation of the Company to effect the Merger is
further subject to the satisfaction or waiver at or prior to the Closing
Date of the following conditions:
(a) The representations and warranties of Parent and the
Purchaser contained in this Agreement shall be true and correct in all
material respects at and as of the date hereof, and true and correct in all
material respects at and as of the Closing Date as if made at and as of
such time;
(b) Each of Parent and the Purchaser shall have performed in
all material respects its obligations under this Agreement required to be
performed by it at or prior to the Closing Date pursuant to the terms
hereof; and
(c) A special cash dividend of $10.00 per share of Company
Common Stock shall have been paid; provided, however, if such dividend
shall not have been paid, this condition shall be satisfied if the Merger
Consideration shall have been increased by $10.00 per share in cash.
Section 6.3 Conditions to Obligations of Parent and the
Purchaser to Effect the Merger. The obligations of Parent and the Purchaser
to effect the Merger are further subject to the satisfaction or waiver at
or prior to the Closing Date of the following conditions:
(a) The representations and warranties of the Company contained
in this Agreement shall be true and correct in all material respects at and
as of the date hereof, and true and correct in all material respects at and
as of the Closing Date as if made at and as such time; provided, however,
that, for purposes of this Section, such representations and warranties
shall be deemed to be true and correct in all material respects unless the
failure or failures of such representations and warranties to be so true
and correct, individually or in the aggregate, would result in a Material
Adverse Effect;
(b) The Company shall have performed in all material respects
each of its obligations under this Agreement required to be performed by it
at or prior to the Closing Date pursuant to the terms hereof; provided,
however, that, for purposes of this Section, such obligations shall be
deemed to have been performed in all material respects unless the failure
or failures to so perform, individually or in the aggregate, would result
in a Material Adverse Effect; and
(c) No proceeding not pending on the date hereof shall be
pending which has a reasonable probability of having, singularly or in the
aggregate with all such proceedings, a Material Adverse Effect.
ARTICLE VII
TERMINATION
Section 7.1 Termination. Subject to Section 8.2(c), this
Agreement may be terminated and the Merger may be abandoned at any time
prior to the Effective Time, whether before or after stockholder approval
thereof:
(a) By the mutual consent of Parent, the Purchaser and the
Company.
(b) By either the Company, on the one hand, or Parent and the
Purchaser, on the other hand, if:
(i) the Merger has not been consummated on or prior to
September 30, 1997; provided, however, that the right to terminate
this Agreement under this Section 7.1(b)(i) shall not be available to
any party whose failure to fulfill any obligation under this Agreement
has been the cause of, or resulted in, the failure of the Merger to
occur on or prior to such date;
(ii) the stockholders of the Company fail to approve and
adopt this Agreement and the transactions contemplated hereby;
provided, however, that the right to terminate this Agreement under
this Section 7.1(b)(ii) shall not be available to any party whose
failure to fulfill any obligation under this Agreement has been the
cause of, or resulted in, the failure of the stockholders of the
Company to approve and adopt this Agreement;
(iii) any Governmental Entity shall have issued a
statute, order, decree or regulation or taken any other action, in
each case permanently restraining, enjoining or otherwise prohibiting
the Merger and such statute, order, decree, regulation or other action
shall have become final and non-appealable; or
(iv) if, prior to the consummation of the Merger, the
Special Committee shall have withdrawn, or modified or changed in any
manner adverse to Parent or the Purchaser its approval of this
Agreement or the Merger after having concluded in good faith after
consultation with independent legal counsel that there is a reasonable
probability that the failure to take such action would result in a
violation of fiduciary obligations under applicable law; provided,
however, that the Special Committee shall not be entitled to exercise
a right of termination pursuant to this Section 7.1(b)(iv) based upon
a change in the trading price per share of Cigar Common Stock, it
being understood that the effect of such change on the Merger
Consideration has been specifically addressed in Section 2.1(a)
hereof.
Section 7.2 Effect of Termination. In the event of the
termination of this Agreement as provided in Section 7.1, written notice
thereof shall forthwith be given by the terminating party or parties to the
other party or parties specifying the provision hereof pursuant to which
such termination is made, and this Agreement shall forthwith become null
and void, and there shall be no liability on the part of Parent, the
Purchaser or the Company (except as set forth in this Section 7.2 and
Section 8.1 hereof; each which shall survive any termination of this
Agreement); provided that nothing herein shall relieve any party from any
liability or obligation with respect to any willful breach of this
Agreement.
ARTICLE VIII
MISCELLANEOUS
Section 8.1 Fees and Expenses. Except as contemplated by this
Agreement, all costs and expenses incurred in connection with this
Agreement and the consummation of the transactions contemplated hereby
shall be paid by the party incurring such expenses.
Section 8.2 Amendment; Waiver; Termination.
(a) Subject to Section 8.2(c), this Agreement may be amended by
the parties hereto at any time before or after approval by the stockholders
of the Company of the matters presented in connection with the Merger, but
after any such approval no amendment shall be made without the approval of
such stockholders if required by law or if such amendment changes the
Merger Consideration or alters or changes any of the other terms or
conditions of this Agreement if such alteration or change would adversely
affect the rights of stockholders unaffiliated with Parent. This Agreement
may not be amended except by an instrument in writing signed on behalf of
each of the parties hereto.
(b) Subject to Section 8.2(c), at any time prior to the
Effective Time, the parties may (i) extend the time for the performance of
any of the obligations or other acts of the other parties hereto, (ii)
waive any inaccuracies in the representations and warranties of the other
parties contained herein or in any document, certificate or writing
delivered pursuant hereto or (iii) waive compliance with any of the
agreements or conditions of the other parties hereto contained herein. Any
agreement on the part of any party to any such extension or waiver shall be
valid only if set forth in an instrument in writing signed on behalf of
such party. Any such waiver shall constitute a waiver only with respect to
the specific matter described in such writing and shall in no way impair
the rights of the party granting such waiver in any other respect or at any
other time. Neither the waiver by any of the parties hereto of a breach of
or a default under any of the provisions of this Agreement, nor the failure
by any of the parties, on one or more occasions, to enforce any of the
provisions of this Agreement or to exercise any right or privilege
hereunder, shall be construed as a waiver of any other breach or default of
a similar nature, or as a waiver of any of such provisions, rights or
privileges hereunder. The rights and remedies herein provided are
cumulative and none is exclusive of any other, or of any rights or remedies
that any party may otherwise have at law or in equity.
(c) Notwithstanding any provision of this Agreement to the
contrary, without the approval of the Special Committee, the Company shall
not amend, terminate or waive any right under this Agreement (including any
right to terminate or any actual or potential cause of action).
Section 8.3 Nonsurvival of Representations and Warranties. None
of the representations and warranties in this Agreement or in any schedule,
instrument or other document delivered pursuant to this Agreement shall
survive the Effective Time.
Section 8.4 Notices. All notices and other communications
hereunder shall be in writing and shall be deemed given upon (a)
transmitter's confirmation of a receipt of a facsimile transmission, (b)
confirmed delivery by a standard overnight carrier or when delivered by
hand, (c) the expiration of five business days after the day when mailed in
the United States by certified or registered mail, postage prepaid, or (d)
delivery in person, addressed at the following addresses (or at such other
address for a party as shall be specified by like notice):
(a) if to the Company, to:
Mafco Consolidated Group Inc.
35 East 62nd Street
New York, New York 10021
Telephone: (212) 572-8600
Facsimile: (212) 572-5056
Attention: General Counsel
with a copy to:
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019-6150
Telephone: (212) 403-1000
Facsimile: (212) 403-2000
Attention: Adam O. Emmerich, Esq.
(b) if to the Parent or the Purchaser, to:
Mafco Consolidated Holdings Inc.
35 East 62nd Street
New York, New York 10021
Telephone: (212) 572-8600
Facsimile: (212) 572-5056
Attention: General Counsel
with a copy to:
Skadden, Arps, Slate, Meagher & Flom
919 Third Avenue
New York, New York 10022
Telephone: (212) 735-3000
Facsimile: (212) 735-2001
Attention: Alan C. Myers, Esq.
Section 8.5 Interpretation. When a reference is made in this
Agreement to Sections, such reference shall be to a Section of this
Agreement unless otherwise indicated. Whenever the words "include",
"includes" or "including" are used in this Agreement they shall be deemed
to be followed by the words "without limitation". The phrase "made
available" when used in this Agreement shall mean that the information
referred to has been made available to the party to whom such information
is to be made available. The word "affiliates" when used in this Agreement
shall have the meaning ascribed to it in Rule 12b-2 under the Exchange Act.
The phrase "beneficial ownership" and words of similar import when used in
this Agreement shall have the meaning ascribed to it in Rule 13d-3 under
the Exchange Act.
Section 8.6 Headings. The headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning
or interpretation of this Agreement.
Section 8.7 Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original but all of
which shall be considered one and the same agreement.
Section 8.8 Entire Agreement; No Third Party Beneficiaries;
Rights of Ownership. This Agreement (including the documents and the
instruments referred to herein): (a) constitutes the entire agreement and
supersedes all prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof, and (b) except
as provided in Section 5.6 is not intended to confer upon any person other
than the parties hereto any rights or remedies hereunder.
Section 8.9 Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction
or other authority to be invalid, void, unenforceable or against its
regulatory policy, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and
shall in no way be affected, impaired or invalidated.
Section 8.10 Governing Law. This Agreement shall be governed,
construed and enforced in accordance with the laws of the State of Delaware
without giving effect to the principles of conflicts of law thereof.
Section 8.11 Assignment. Neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned by any of the
parties hereto (whether by operation of law or otherwise) without the prior
written consent of the other parties; provided, however, Parent or the
Purchaser may assign this Agreement to any Subsidiary of Parent or the
Purchaser. No such assignment shall relieve either Parent or the Purchaser
of its obligations under this Agreement. Subject to the first sentence of
this Section 8.11, this Agreement will be binding upon, inure to the
benefit of and be enforceable by, the parties hereto and their respective
successors and assigns.
IN WITNESS WHEREOF, Parent, the Purchaser and the Company have
caused this Agreement to be signed by their respective officers thereunto
duly authorized as of the date first written above.
MAFCO CONSOLIDATED GROUP INC.
By: /s/ Glenn P. Dickes
----------------------------
Name: Glenn P. Dickes
Title: Vice President
MAFCO CONSOLIDATED HOLDINGS INC.
By: /s/ Glenn P. Dickes
----------------------------
Name: Glenn P. Dickes
Title: Vice President
MCG ACQUISITION INC.
By: /s/ Glenn P. Dickes
----------------------------
Name: Glenn P. Dickes
Title: Vice President
EXHIBIT A
RESTATED CERTIFICATE OF INCORPORATION
OF
MAFCO CONSOLIDATED GROUP INC.
FIRST: The name of the Corporation is Mafco Consolidated Group
Inc. (hereinafter the "Corporation").
SECOND: The address of the registered office of the Corporation
in the State of Delaware is 1013 Centre Road, in the City of Wilmington,
County of New Castle. The name of its registered agent at that address is
The Prentice-Hall Corporation System, Inc.
THIRD: The purpose of the Corporation is to engage in any
lawful act or activity for which a corporation may be organized under the
General Corporation Law of the State of Delaware as set forth in Title 8 of
the Delaware Code (the "GCL").
FOURTH: The total number of shares of stock which the
Corporation shall have authority to issue is 1,000 shares of Common Stock,
each having a par value of one dollar ($1.00).
FIFTH: The following provisions are inserted for the management
of the business and the conduct of the affairs of the Corporation, and for
further definition, limitation and regulation of the powers of the
Corporation and of its directors and stockholders:
(1) The business and affairs of the Corporation shall be
managed by or under the direction of the Board of Directors.
(2) The directors shall have concurrent power with the
stockholders to make, alter, amend, change, add to or repeal the
By-Laws of the Corporation.
(3) The number of directors of the Corporation shall be as from
time to time fixed by, or in the manner provided in, the By-Laws of
the Corporation. Election of directors need not be by written ballot
unless the By-Laws so provide.
(4) No director shall be personally liable to the Corporation
or any of its stockholders for monetary damages for breach of
fiduciary duty as a director, except for liability (i) for any breach
of the director's duty of loyalty to the Corporation or its
stockholders, (ii) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, (iii)
pursuant to Section 174 of the Delaware General Corporation Law or
(iv) for any transaction from which the director derived an improper
personal benefit. Any repeal or modification of this Article FIFTH by
the stockholders of the Corporation shall not adversely affect any
right or protection of a director of the Corporation existing at the
time of such repeal or modification with respect to acts or omissions
occurring prior to such repeal or modification.
(5) In addition to the powers and authority hereinbefore or by
statute expressly conferred upon them, the directors are hereby
empowered to exercise all such powers and do all such acts and things
as may be exercised or done by the Corporation, subject, nevertheless,
to the provisions of the GCL, this Certificate of Incorporation, and
any By-Laws adopted by the stockholders; provided, however, that no
By-Laws hereafter adopted by the stockholders shall invalidate any
prior act of the directors which would have been valid if such By-Laws
had not been adopted.
SIXTH: Meetings of stockholders may be held within or without
the State of Delaware, as the By-Laws may provide. The books of the
Corporation may be kept (subject to any provision contained in the GCL)
outside the State of Delaware at such place or places as may be designated
from time to time by the Board of Directors or in the By-Laws of the
Corporation.
SEVENTH: The Corporation reserves the right to amend, alter,
change or repeal any provision contained in this Certificate of
Incorporation, in the manner now or hereafter prescribed by statute, and
all rights conferred upon stockholders herein are granted subject to this
reservation.
