SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported) May 20, 1997
Toy Biz, Inc.
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(Exact Name of Registrant as Specified in its Charter)
Delaware 1-13638 13-3711775
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(State or Other (Commission (I.R.S. Employer
Jurisdiction of File Number) Identification
incorporation) No.)
333 East 38th Street, New York, New York 10016
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(Address of Principal Executive Offices) (Zip Code)
(212) 682-4700
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(Registrant's Telephone Number, Including Area Code)
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(Former Name or Former Address, If Changed Since Last Report.)
495430.1
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ITEM 5. Other Events.
On May 20, 1997, the Registrant issued a press release, a copy
of which is attached hereto as Exhibit 99.1, announcing that it had terminated
its letter of intent, dated April 28, 1997, with Marvel Entertainment Group,
Inc. ("Marvel") with respect to Toy Biz's participation in a plan of
reorganization of Marvel and certain of its subsidiaries (collectively with
Marvel, the "Debtors") and will withdraw from the plan of reorganization filed
on a joint basis by Marvel and the Registrant on May 15, 1997 in the jointly
administered chapter 11 cases of the Debtors currently pending in the United
States Bankruptcy Court for the District of Delaware. On May 21, 1997, the
Registrant issued a press release, a copy of which is attached hereto as Exhibit
99.2, announcing that it had signed a proposed term sheet with the Official
Bondholders Committee of the holding companies of Marvel, pursuant to which
Marvel and Toy Biz would combine to become separate subsidiaries of a new
holding company. A copy of the proposed term sheet is attached hereto as Exhibit
99.3.
ITEM 7. Financial Statements and Exhibits.
(c) Exhibits.
99.1. Press release of the Registrant, dated May 20, 1997.
99.2. Press release of the Registrant, dated May 21, 1997.
99.3. Proposed Term Sheet, dated May 21, 1997, between the Official
Bondholders Committee of Marvel Holdings Inc. et al. and the
Registrant.
495430.1
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
TOY BIZ, INC.
(Registrant)
Date: May 22, 1997
By /s/ Joseph M. Ahearn
-----------------------------
Name: Joseph M. Ahearn
Title: President and Chief
Executive Officer
495430.1
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EXHIBIT INDEX
Exhibit
99.1. Press release of the Registrant, dated May 20, 1997.
99.1. Press release of the Registrant, dated May 21, 1997.
99.3. Proposed Term Sheet, dated May 21, 1997, between the Official
Bondholders Committee of Marvel Holdings Inc. et al. and the Registrant.
495430.1
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FOR IMMEDIATE RELEASE
Contact: Diane Perry or Joseph Kist
Edelman Financial
212-704-8293 or 212-704-8239
TOY BIZ, INC. TERMINATES PLAN TO COMBINE WITH MARVEL
ENTERTAINMENT GROUP, INC.
New York, NY, May 20, 1997. Toy Biz, Inc. (NYSE:TBZ) announced today that Toy
Biz has terminated its letter of intent, dated April 28, 1997, with Marvel
Entertainment Group, Inc. (NYSE:MRV) with respect to Toy Biz's participation in
a plan of reorganization of Marvel and certain of its direct and indirect
subsidiaries and will withdraw from the plan of reorganization jointly filed by
Toy Biz and Marvel on May 15, 1997 in U.S. Bankruptcy Court for the District of
Delaware.
Toy Biz intends to engage in discussions with various parties in interest in
Marvel's Chapter 11 case towards reaching a new understanding reflecting the
terms upon which Toy Biz can proceed with a Marvel plan of reorganization. There
can be no assurance that a new understanding will be reached. As a matter of
policy, Toy Biz will not comment on ongoing discussions nor any rumors with
respect to the foregoing.
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495616.1
FOR IMMEDIATE RELEASE
Contact: Diane Perry or Joseph Kist
Edelman Financial
212-704-8293 or 212-704-8239
TOY BIZ, INC. ANNOUNCES PROPOSED ARRANGEMENT WITH
MARVEL BONDHOLDERS COMMITTEE
New York, NY, May 21, 1997. Toy Biz, Inc. (NYSE:TBZ) announced today that Toy
Biz has signed a proposed term sheet with the Official Bondholders Committee of
the holding companies of Marvel Entertainment Group, Inc. (NYSE:MRV) pursuant to
which Marvel and Toy Biz would combine to become separate subsidiaries of a new
holding company.
Holders of bonds issued by the Marvel holding companies and other Marvel
stockholders will invest $300 to $500 million in the combined company in a
rights offering for which certain of the bondholders will act as standby
purchasers. In connection with the combination, Toy Biz stockholders other than
Marvel will receive 40% of the capital stock of the combined company and Marvel
stockholders, including holders of the Marvel holding companies bonds, will
receive 60% of the capital stock of the combined company.
The proposed arrangement is not legally binding and is subject to approval of
Toy Biz's board of directors and shareholders.
As a matter of policy, Toy Biz will not comment on ongoing discussions or rumors
with respect to the foregoing.
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495620.1
Proposed Terms
The following sets forth a proposal providing for a
combination of Toy Biz, Inc. ("Toy Biz") and Marvel Entertainment Group, Inc.
("Marvel") which shall form the basis for a revised joint chapter 11 plan of
reorganization to be proposed by Toy Biz and the Official Bondholders Committee
of Marvel Holdings, Inc. et. al. (the "Bondholders Committee"):
1. Marvel and Toy Biz will combine to become separate
subsidiaries of a new holding company ("Newco"). In connection with the
combination, Toy Biz shareholders will receive 40% of the capital stock of Newco
on a fully diluted basis in exchange for their interests in Toy Biz, and Marvel
shareholders (including holders of Marvel parent company bonds in their capacity
as pledgees of Marvel stock) ("Marvel Equity Holders") will receive 60% of the
capital stock of Newco on a fully diluted basis in exchange for their interests
in Marvel.
2. Pursuant to a rights offering, Marvel Equity Holders will
contribute $200 million in new equity into Newco and will purchase $300 million
(or $100 million as provided in 3(b) below) in new notes to be issued by Newco.
To the extent the rights offering is not fully subscribed, High River Limited
Partnership, Westgate International, L.P. and United Equities Commodities
Company will fund the shortfall.
3. (a) If the holders of the Marvel secured bank claims
("Marvel Secured Claims") accept the terms described in this proposal, the
holders of Marvel Secured Claims will receive, under a joint plan to be proposed
by the Bondholders Committee and Toy Biz, $300 million in cash and the equity
interests and assets of Fleer/Skybox and Panini in satisfaction of the Marvel
Secured Claims.
(b) If the holders of the Marvel Secured Claims do not accept
the above-described terms, the Marvel Secured Claims will be reinstated as
obligations of the Marvel subsidiary of Newco. Such reinstated claims shall be
secured by the same assets that secured the Marvel Secured Claims at the
commencement of these cases. In addition, Newco shall guarantee the reinstated
Marvel Secured Claims for a period not to exceed two years. In this case, the
debt portion of the rights offering shall be reduced to $100 million.
4. The debt offered in the rights offering shall be
subordinated to the working capital financing of Newco.
5. Former holders of Toy Biz Class A common stock will be
afforded generally the same governance rights in Newco as they currently hold in
Toy Biz, subject to certain exceptions agreed upon by Toy Biz and the
Bondholders Committee.
494881.4
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6. Toy Biz and members of the Bondholders Committee shall work
diligently to document and implement this proposal and Toy Biz's management will
recommend this proposal to Toy Biz's board; provided that this proposal is not
legally binding on any party and is subject to the approval of Toy Biz's board
of directors and shareholders.
Date: May 21, 1997
TOY BIZ, INC.
By /s/Joseph M. Ahearn
________________________________
Joseph M. Ahearn
President
OFFICIAL BONDHOLDERS COMMITTEE OF
MARVEL HOLDINGS, INC. ET. AL.
By /s/Carl C. Icahn
________________________________
Carl C. Icahn
Its Chairman
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