UNITED NEWS & MEDIA PLC
XXXXXX XXXXXXX WORLDWIDE PLC
MFW ACQUISITION CORP.
Xxxxxxx Xxxxx
000 Xxxxxxxxxxx Xxxx
Xxxxxx XX0 0XX
June 3, 1999
CMP Media Inc.
000 Xxxxxxxxx Xxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Dear Sirs:
The Agreement and Plan of Merger dated as of April 28, 1999
(the "Agreement") by and among United News & Media plc ("United"), Xxxxxx
Xxxxxxx Worldwide plc ("Parent"), MFW Acquisition Corp. ("Merger Sub") and CMP
Media Inc. (the "Company") states, in Section 9.3, that Parent is to cause
certain funds to be set aside in an escrow. This letter sets forth our mutual
agreement that, instead of the escrow arrangement contemplated by Section 9.3,
Parent will cause certain payments to be made directly to the Company. (All
capitalized terms not otherwise defined in this letter have the respective
meanings set forth in the Agreement.)
Accordingly, Section 9.3 of the Agreement is hereby amended to
read in its entirety as follows:
9.3 TRANSACTION COSTS. (a) On the day of the
consummation of the Offer, Parent shall cause a wire transfer
to the account of the Company, in same day funds, of fifty
nine million dollars ($59,000,000). Merger Sub will cause and
authorize the Company to use such funds to pay (i) the fees
and costs of all financial and accounting advisors retained by
the Company in connection with the negotiation and/or
consummation of the Offer and the Merger, (ii) all amounts due
to holders of Options and to employees participating in the
ESPP pursuant to Section 3.1(d) hereof, (iii) all amounts due
to Company Employees and former employees of the Company under
the Company's 1988 Equity Appreciation Plan and (iv) all
amounts due to Company Employees under the Company's 1998
Annual Incentive Compensation Plan. Any such funds not
required for such
payments shall be returned to Parent. The Company hereby
represents that a true and complete estimate of such fees,
costs and amounts is attached hereto as Exhibit A, and that
the total amount of such fees, costs and amounts will not
exceed eighty three million nine hundred nineteen thousand
dollars ($83,919,000).
(b) Prior to the date on which any amounts set forth
on Exhbit B, including any retention bonuses and
transaction-based bonuses associated with the Merger, are
contractually payable by the Company to Company Employees, to
former employees of the Company or to governmental
authorities, Parent shall cause a wire transfer to the Company
of the amount payable; provided, however, that in no event
shall the total amount of all transfers under this Section
9.3(b) exceed thirty five million one hundred nineteen
thousand dollars ($35,119,000). The Company hereby represents
that a true and complete estimate of such bonuses and benefits
is attached hereto as Exhibit B, and that the total amount of
such bonuses and benefits will not exceed thirty five million
one hundred nineteen thousand dollars ($35,119,000).
(c) Each Company Employee, former employee or advisor
referenced in Section 9.3(a) or Section 9.3(b) is intended to
be a third party beneficiary of the covenants set forth in
this Section 9.3 and of the guaranty of United set forth in
Section 6.9 to the extent that such guaranty relates to this
Section 9.3.
[The remainder of this page has been left blank intentionally.]
Please indicate your acceptance of, and agreement with, the
foregoing by signing and returning one copy of this letter.
UNITED NEWS & MEDIA PLC
By: /s/ X. X. Xxxxx
--------------------------------
Name: X. X. Xxxxx
Title: Finance Director
XXXXXX XXXXXXX WORLDWIDE PLC
By: /s/ A.M. Tillin
---------------------------------
Name: A. M. Tillin
Title: Chief Executive Officer
MFW ACQUISITION CORP.
By: /s/ Xxxxxx Xxxxxx
----------------------------------
Name: Xxxxxx Xxxxxx
Title: Chief Executive Officer
ACCEPTED AND AGREED:
CMP MEDIA INC.
By: /s/ Xxxxxxx X. Xxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxx
Title: President and CEO
EXHIBIT A
$(000'S)
Payments to stock option holders $45,964
Payments to employees participating in the ESPP 666
Payments to employees and former employees under the 1988 Equity 13,228
Appreciation Plan
1998 Annual Incentive Compensation Plan bonuses 2,482
Estimated employer payroll taxes on above payments 1,425
Lazard fees and expenses 19,416
Accounting and tax fees 488
Other 250
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$83,919
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EXHIBIT B
$(000'S)
Executive retention and transaction bonuses $17,274
Other retention and transaction bonuses 5,645
Estimated gross up payments 11,000
Estimated employer payroll taxes on above payments 1,200
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$35,119
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