APPENDIX A
AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER, dated as of July 1, 1999,
amending and restating the AGREEMENT AND PLAN OF MERGER dated as of May 14, 1999
(this "Agreement"), among THE NEIMAN MARCUS GROUP, INC., a Delaware corporation
(the "Company"), HARCOURT GENERAL, INC., a Delaware corporation ("Harcourt
General") and SPRING MERGER CORPORATION, a Delaware corporation and a
wholly-owned subsidiary of Harcourt General ("Merger Sub").
WHEREAS, Harcourt General will own 21,440,960 shares of common stock, par
value $.01 per share, of the Company ("Common Stock") immediately prior to the
Merger (as defined below), and Harcourt General will own through HGI Investment
Trust, a wholly owned subsidiary of Harcourt General ("HGI"), 4,988,542 shares
of Common Stock (the "Retained Shares") immediately prior to the Merger,
totaling 26,429,502 shares of Common Stock;
WHEREAS, Harcourt General owns all of the issued and outstanding shares of
common stock, par value $.01 per share, of Merger Sub ("Merger Sub Common
Stock");
WHEREAS, prior to the effectiveness of the Merger, Harcourt General plans
to contribute to Merger Sub 21,440,960 of its 26,429,502 shares of Common Stock
(the "Contributed Shares");
WHEREAS, Harcourt General and the Company desire that Merger Sub merge with
and into the Company (the "Merger") upon the terms and subject to the conditions
set forth in this Agreement in accordance with the General Corporation Law of
the State of Delaware (the "DGCL"), pursuant to which all the issued and
outstanding shares of Merger Sub Common Stock shall be converted into shares of
a new class of common stock designated as Class B Common Stock, par value $.01
per share, of the Company ("Class B Common Stock") and all the issued and
outstanding shares of Common Stock (other than the Contributed Shares held by
Merger Sub, which shall be canceled with no securities or other consideration
issued in exchange therefor) shall be converted into Class A Common Stock
("Class A Common Stock") and shall remain issued and outstanding;
WHEREAS, Harcourt General has announced its intention, subject to the
satisfaction of certain conditions, to distribute all the shares of Class B
Common Stock, on a pro rata basis, to the holders of the common stock of
Harcourt General following consummation of the Merger (the "Distribution");
WHEREAS, simultaneously with the execution hereof, the Company and Harcourt
General are entering into a Distribution Agreement dated as of the date hereof
(the "Distribution Agreement"), which provides for the Distribution and certain
other matters;
WHEREAS, the Boards of Directors of the Company and Merger Sub by
resolutions duly adopted have approved the terms of this Agreement and of the
Merger, have declared the advisability of this Agreement and of the Merger and
determined them to be fair to and in the best interests of the Company and
Merger Sub and their respective subsidiaries, and have directed the submission
of this Agreement to their respective stockholders for approval; and
WHEREAS, the Merger is intended to constitute a reorganization within the
meaning of Section 368(a)(1)(E) of the Internal Revenue Code of 1986, as
amended.
NOW, THEREFORE in consideration of the premises and the mutual agreements
and provisions herein contained, the parties hereto agree as follows:
ARTICLE I
THE MERGER
SECTION 1.1. The Merger. (a) Upon the terms and subject to the conditions
of this Agreement, at the Effective Time (as defined below), Merger Sub shall be
merged with and into the Company in accordance
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with the DGCL, whereupon the separate corporate existence of Merger Sub shall
cease, and the Company shall be the surviving corporation (the "Surviving
Corporation").
(b) Following satisfaction or waiver of all conditions to the Merger, the
Company and Merger Sub shall file a certificate of merger with the Secretary of
State of the State of Delaware and make all other filings or recordings required
by the DGCL in connection with the Merger. The Merger shall become effective at
such time as the certificate of merger is duly filed with the Secretary of State
of the State of Delaware or at such later time as is specified in the
certificate of merger (the "Effective Time").
(c) At and after the Effective Time, the Merger shall have the effects set
forth in the DGCL. Without limiting the foregoing and subject thereto, from and
after the Effective Time, the Surviving Corporation shall possess all the
rights, privileges, powers and franchises and be subject to all of the
restrictions, disabilities and duties of the Company and Merger Sub, all as
provided under the DGCL.
SECTION 1.2. Effect on Capital Stock. At the Effective Time:
(a) All of the shares of Merger Sub Common Stock outstanding immediately
prior to the Effective Time shall be converted in the aggregate into and become
21,440,960 fully paid and non-assessable shares of Class B Common Stock of the
Surviving Corporation, and shall have the rights and privileges as set forth in
the Surviving Corporation Certificate of Incorporation (as defined in Section
2.1);
(b) Each of the Contributed Shares shall automatically be canceled and
shall cease to exist and no stock of the Surviving Corporation or other
consideration shall be delivered in exchange therefor; and
(c) Each share of Common Stock (other than the Contributed Shares to be
canceled in accordance with Section 1.2(b)), including shares held in the
treasury, if any, and shares held by HGI, shall be converted into "Class A
Common Stock."
SECTION 1.3. Share Certificates. (a) As soon as practicable after the
Effective Time:
(i) the Surviving Corporation shall deliver, or cause to be delivered,
to Harcourt General a number of certificates issued in the names of such
persons, in each case, as Harcourt General shall direct, representing in
the aggregate 21,440,960 shares of Class B Common Stock which Harcourt
General has the right to receive upon conversion of shares of Merger Sub
Common Stock pursuant to the provisions of Section 1.2(a) hereof;
(ii) the Surviving Corporation shall cancel the share certificate or
certificates representing the shares of Common Stock owned directly by
Merger Sub; and
(iii) the share certificates representing shares of Common Stock that
remain issued and outstanding under Section 1.2(c) hereof or that remain
treasury shares under Section 1.2(c) hereof shall not be exchanged and
shall continue to represent an equal number of shares of Class A Common
Stock of the Surviving Corporation without physical substitution of share
certificates of the Surviving Corporation for existing share certificates
of the Company.
(b) Any dividend or other distribution declared or made with respect to any
shares of capital stock of the Company, whether the record date for such
dividend or distribution is before or after the Effective Time, shall be paid to
the holder of record of such shares of capital stock on such record date,
regardless of whether such holder has surrendered its certificates representing
Class A Common Stock or received certificates representing Class B Common Stock
pursuant to Section 1.3(a)(i).
ARTICLE II
THE SURVIVING CORPORATION
SECTION 2.1. Certificate of Incorporation. At the Effective Time, the
Certificate of Incorporation of the Company as in effect immediately prior to
the Effective Time shall be the Certificate of Incorporation of the Surviving
Corporation, except that such Certificate of Incorporation shall be amended as
set forth in Exhibit A-1 hereto, with such changes thereto as are set forth in
Exhibit A-1 to reflect, if approved by the vote
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of the holders of a majority of the outstanding Common Stock, each of the Board
Size Amendment, the Supermajority Voting Amendment and the Authorized Capital
Amendment (as defined in Section 3.1 below). The Certificate of Incorporation of
the Surviving Corporation that becomes effective pursuant to this Section 2.1 is
herein referred to as the "Surviving Corporation Certificate of Incorporation."
SECTION 2.2. By-Laws. (a) At the Effective Time, the By-Laws of the
Company as in effect immediately prior to the Effective Time shall be the
By-Laws of the Surviving Corporation. The By-Laws of the Surviving Corporation
are herein referred to as the "Surviving Corporation By-Laws."
SECTION 2.3. Directors and Officers. (a) The Surviving Corporation's
Board of Directors initially shall consist of eight members as identified on
Exhibit B-1 hereto. From and after the Effective Time, until the earlier of
their removal or resignation or until their successors are duly elected or
appointed and qualified in accordance with applicable law, the directors of the
Surviving Corporation shall consist of the directors of the Company in office at
the Effective Time. At the Effective Time, the directors of the Surviving
Corporation shall be divided into two classes pursuant to the Surviving
Corporation Certificate of Incorporation. One director of the Surviving
Corporation shall be designated a "Class A Director" and will remain in the
class of which such director is currently a member that designates the
expiration of such director's term. Each of the remaining seven directors of the
Surviving Corporation shall be designated a "Class B Director" and each will
remain in the class of which each such director is currently a member that
designates the expiration of such director's term. The director of the Company
that is expected to be designated as the "Class A Director" shall be identified
by the Board of Directors of the Company from the directors of the Company that
are not affiliated with Harcourt General on or prior to the date on which the
Proxy Statement referred to in Section 3.2 is mailed to the Company's
stockholders.
(b) From and after the Effective Time, until the earlier of their removal
or resignation or until their successors are duly appointed and qualified in
accordance with applicable law and the Surviving Corporation By-Laws, the
officers of the Company shall be the officers of the Surviving Corporation.
ARTICLE III
COVENANTS
SECTION 3.1. Stockholders Meeting. The Company shall, as soon as
practicable following the date of this Agreement, duly call, give notice of,
convene and hold, a meeting of its stockholders (the "Stockholders Meeting") for
the purpose of considering, as four separate proposals, (i) the adoption of this
Agreement; (ii) the approval of an amendment to the Certificate of Incorporation
of the Company establishing a range for the number of directors on the Surviving
Corporation's Board of Directors from six to nine, the actual number to be
determined exclusively by resolution of the Surviving Corporation's Board of
Directors, a provision that prohibits the alteration or repeal of this provision
without the vote of at least 66- 2/3% of the total voting power of the
outstanding shares of the Surviving Corporation's voting stock, voting together
as a single class, and related provisions in Article Twelfth of the Certificate
of Incorporation as set forth in Exhibit A-1 hereto to become effective in the
Merger at the Effective Time (the "Board Size Amendment"); (iii) the approval of
an amendment to the Certificate of Incorporation of the Company providing for a
requirement that the approval of 66- 2/3% of the total voting power of the
outstanding shares of the Surviving Corporation's common stock is necessary to
approve any merger or consolidation, any sale, lease, exchange or other
disposition of all or substantially all of the Surviving Corporation's assets
and, unless approved by two-thirds of the Surviving Corporation's Board of
Directors, any issuance of voting securities of the Surviving Corporation that
would require stockholder approval and related provisions in Article Thirteenth
of the Certificate of Incorporation as set forth in Exhibit A-1 hereto to become
effective in the Merger at the Effective Time (the "Supermajority Voting
Amendment") and (iv) the approval of an amendment to the Certificate of
Incorporation of the Company providing for an increase in authorized capital and
the creation of a new Class C Common Stock having one-tenth ( 1/10) of one vote
per share and related provisions in Article Fourth of the Certificate of
Incorporation as set forth in Exhibit A-1 hereto to become effective in the
Merger at the Effective Time (the "Authorized Capital Amendment"). The Company
hereby represents and warrants to Harcourt General that a committee of
independent directors of the Company's Board of Directors has approved the
Merger, this
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Agreement, the Board Size Amendment, the Supermajority Voting Amendment and the
Authorized Capital Amendment, has determined that the Merger, this Agreement,
the transactions contemplated by the Distribution Agreement, the Board Size
Amendment, the Supermajority Voting Amendment and the Authorized Capital
Amendment are advisable and favorable to and, therefore, fair to and in the best
interests of the stockholders of the Company other than Harcourt General, and
has recommended that the stockholders of the Company vote in favor of the
adoption of this Agreement, the Board Size Amendment, the Supermajority Voting
Amendment and the Authorized Capital Amendment. The Company shall, through a
committee of independent directors of its Board of Directors, continue to
recommend to its stockholders adoption of this Agreement, the Board Size
Amendment, the Supermajority Voting Amendment and the Authorized Capital
Amendment and shall not withdraw such recommendation.
SECTION 3.2. Filings; Other Actions. (a) Subject to the provisions of
this Agreement and the Distribution Agreement, the Company shall prepare and
file with the Securities and Exchange Commission (the "SEC") as soon as
reasonably possible following the execution hereof a proxy statement for the
solicitation of proxies in favor of (i) the adoption of this Agreement, (ii) the
approval of the Board Size Amendment as an amendment to the Certificate of
Incorporation of the Company to become effective in the Merger at the Effective
Time, (iii) the approval of the Supermajority Voting Amendment as an amendment
to the Certificate of Incorporation of the Company to become effective in the
Merger at the Effective Time and (iv) the approval of the Authorized Capital
Amendment as an amendment to the Certificate of Incorporation of the Company to
become effective in the Merger at the Effective Time (the "Proxy Statement").
The Company shall use all reasonable efforts to have the Proxy Statement cleared
by the SEC for mailing in definitive form as promptly as practicable after such
filing. The Company and Harcourt General shall cooperate with each other in the
preparation of the Proxy Statement and any amendment or supplement thereto, and
the Company shall notify Harcourt General of the receipt of any comments of the
SEC with respect to the Proxy Statement and of any requests by the SEC for any
amendment or supplement thereto or for additional information, and shall provide
to Harcourt General promptly copies of all correspondence between the SEC and
the Company or any of its advisors with respect to the Proxy Statement. The
Company shall give Harcourt General and its counsel appropriate advance
opportunity to review the Proxy Statement and all responses to requests for
additional information by and replies to comments of the SEC, and shall
incorporate therein any comments Harcourt General may deliver to the Company
with respect thereto, before such Proxy Statement, response or reply is filed
with or sent to the SEC. The Company agrees to use its best efforts, after
consultation with Harcourt General and its advisors, to respond promptly to all
such comments of, and requests by, the SEC and to cause the Proxy Statement to
be mailed to the holders of its common stock entitled to vote at the
Stockholders Meetings at such time as shall be requested by Harcourt General.
(b) The Company agrees promptly to furnish to Harcourt General all copies
of written communications (and summaries of the substance of all oral
communications) received by it, or any of its affiliates or representatives
from, or delivered by any of the foregoing to, any federal, state or local or
international court, commission, governmental body, agency, authority, tribunal,
board or other governmental entity (each a "Governmental Entity") in respect of
the transactions contemplated hereby.
SECTION 3.3. Best Efforts. Except in the case of Harcourt General to the
extent that it shall have exercised its right to terminate the Distribution
Agreement in accordance with the terms thereof, upon the terms and subject to
the conditions set forth in this Agreement, each of the parties hereto agrees to
use its best efforts to take, or cause to be taken, all actions, and to do, or
cause to be done, and to assist and cooperate with the other party in doing, all
things necessary, proper or advisable to consummate and make effective, in the
most expeditious manner practicable, the Merger and the other transactions
contemplated by this Agreement and the Distribution Agreement, including, but
not limited to (i) the obtaining of all necessary actions or non-actions,
waivers, consents and approvals from all Governmental Entities and the making of
all necessary registrations and filings (including filings with Governmental
Entities) and the taking of all reasonable steps as may be necessary to obtain
an approval or waiver from, or to avoid an action or proceeding by, any
Governmental Entity, (ii) the obtaining of all necessary consents, approvals or
waivers from third parties, (iii) the defending of any lawsuits or other legal
proceedings, whether judicial or administrative, challenging this Agreement or
the consummation of the transactions contemplated hereby, including seeking to
have any
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stay or temporary restraining order entered by any court or other Governmental
Entity with respect to the Merger or this Agreement vacated or reversed, (iv)
the execution and delivery of any additional instruments necessary to consummate
the transactions contemplated by this Agreement and (v) taking such other
actions as are necessary, including agreeing to such other amendments to or
modifications of this Agreement to obtain a favorable tax ruling from the
Internal Revenue Service as to the Federal income tax consequences of the Merger
and Distribution.
SECTION 3.4. Merger Sub Approval. The Board of Directors of Merger Sub
has approved and declared advisable the Merger and this Agreement, has
determined that the Merger is fair to and in the best interests of its
stockholders and has recommended that its stockholders adopt this Agreement. As
promptly as possible following the execution of this Agreement, Harcourt
General, as sole stockholder of Merger Sub, shall execute a written consent
adopting this Agreement.
SECTION 3.5. Harcourt General Approval. Harcourt General agrees to vote,
or cause to be voted, all of the shares of Common Stock owned by it and any of
its subsidiaries in favor of the adoption of this Agreement, the Board Size
Amendment, the Supermajority Voting Amendment and the Authorized Capital
Amendment.
SECTION 3.6. Stockholders Rights Plan. The Company agrees that prior to
the Distribution, it will adopt a stockholders rights plan substantially in the
form attached hereto as Exhibit D-1.
ARTICLE IV
CONDITIONS TO THE MERGER
SECTION 4.1. Conditions to the Obligations of the Company. The
obligations of the Company to consummate the Merger are subject to the
satisfaction (or waiver by the Company, except that the condition set forth in
Section 4.1(a) may not be waived) of the following conditions:
(a) a proposal to adopt this Agreement has been approved by the
holders of (i) two-thirds of the shares of Common Stock outstanding and
entitled to vote thereon and (ii) a majority of the shares of Common Stock
(other than shares held directly or indirectly by Harcourt General) present
in person or by proxy at the Stockholders Meeting and voting on such
proposal;
(b) no court, arbitrator or governmental body, agency or official
shall have issued any order, and there shall not be any statute, rule or
regulation, restraining or prohibiting the consummation of the Merger or
the Distribution and no proceeding challenging this Agreement or the
transactions contemplated hereby or seeking to prohibit, alter, prevent or
materially delay the Merger or the Distribution shall have been instituted
by any Governmental Entity before any court, arbitrator or governmental
body, agency or official and be pending;
(c) all actions by or in respect of or filings with any Governmental
Entity required to permit the consummation of the Merger shall have been
obtained, except those that would not reasonably be expected to have a
material adverse affect on any party's ability to consummate the
transactions contemplated by this Agreement; and
(d) all the conditions to the Distribution set forth in the
Distribution Agreement, other than the consummation of the Merger, shall
have been satisfied.
SECTION 4.2. Conditions to the Obligations of Harcourt General and Merger
Sub. The obligations of Harcourt General and Merger Sub to consummate the
Merger are subject to the satisfaction (or waiver by Merger Sub, except that the
condition set forth in Section 4.2(a) may not be waived) of the following
conditions:
(a) a proposal to adopt this Agreement has been approved by the
holders of (i) two-thirds of the shares of Common Stock outstanding and
entitled to vote thereon and (ii) a majority of the shares of Common Stock
(other than shares held directly or indirectly by Harcourt General) present
in person or by proxy at the Stockholders Meeting and voting on such
proposal;
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(b) Harcourt General shall have received a favorable tax ruling from
the Internal Revenue Service as to the Federal income tax consequences of
the Merger and the Distribution;
(c) no court, arbitrator or Governmental Entity shall have issued any
order, and there shall not be any statute, rule or regulation, restraining
or prohibiting the consummation of the Merger or the Distribution and no
proceeding challenging this Agreement or the transactions contemplated
hereby or seeking to prohibit, alter, prevent or materially delay the
Merger or the Distribution shall have been instituted by any Governmental
Entity before any court, arbitrator or governmental body, agency or
official and be pending;
(d) the Class B Common Stock shall have been approved for listing on
the New York Stock Exchange, subject to official notice of issuance;
(e) all actions by or in respect of or filings with any governmental
body, agency, official, or authority required to permit the consummation of
the Merger and the Distribution shall have been obtained, except those that
would not reasonably be expected to have a material adverse affect on any
party's ability to consummate the transactions contemplated by this
Agreement;
(f) the stockholders of Harcourt General shall have approved the
amendment to Harcourt General's Restated Certificate of Incorporation
attached hereto as Exhibit C-1; and
(g) all the conditions to the Distribution set forth in the
Distribution Agreement, other than the consummation of the Merger, shall
have been satisfied.
ARTICLE V
TERMINATION
SECTION 5.1. Termination. This Agreement may be terminated and the Merger
may be abandoned at any time prior to the Effective Time (notwithstanding any
approval of this Agreement by the stockholders of the Company):
(a) by mutual written consent of the Company and Harcourt General;
(b) by either the Company or Harcourt General, if there shall be any
law or regulation that makes consummation of the Merger illegal or
otherwise prohibited or if any judgment, injunction, order or decree
enjoining the Company or Merger Sub from consummating the Merger is entered
and such judgment, injunction, order or decree shall become final and
nonappealable;
(c) by the Company, Merger Sub or Harcourt General, if there shall be
any law or regulation that makes consummation of the Distribution illegal
or otherwise prohibited or if any judgment, injunction, order or decree
enjoining Harcourt General from consummating the Distribution is entered;
(d) by Harcourt General or the Company in the event the Distribution
Agreement is terminated;
(e) by Harcourt General or the Company if, after a vote on the matter
by the Company's stockholders at the Stockholders Meeting, the condition
set forth in Sections 4.1(a) and 4.2(a) is not satisfied; or
(f) by Harcourt General if, after a vote on the matter by Harcourt
General's stockholders at a meeting called for such purpose, the condition
set forth in Section 4.2(f) is not satisfied.
SECTION 5.2. Effect of Termination. If this Agreement is terminated
pursuant to Section 5.1, this Agreement shall become void and of no effect with
no liability on the part of any party hereto.
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ARTICLE VI
MISCELLANEOUS
SECTION 6.1. Notices. All notices and other communications hereunder
shall be in writing and hand delivered or mailed by registered or certified mail
(return receipt requested) or sent by any means of electronic message
transmission with delivery confirmed (by voice or otherwise) to the parties at
the following addresses (or at such other addresses for a party as shall be
specified by like notice) and will be deemed given on the date on which such
notice is received:
To Harcourt General or Merger Sub:
c/o Harcourt General, Inc.
00 Xxxxxxxx Xxxxxx
Xxxxxxxx Xxxx, Xxxxxxxxxxxxx 00000
Telecopy: (000) 000-0000
Attn: Chief Executive Officer
with a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
Attn: Xxxx X. Xxxxxx, Esq.
To the Company:
The Neiman Marcus Group, Inc.
00 Xxxxxxxx Xxxxxx
Xxxxxxxx Xxxx, Xxxxxxxxxxxxx 00000
Telecopy: (000) 000-0000
Attn: Chief Executive Officer
and:
The Independent Directors of the Company
c/o The Secretary of the Company
The Neiman Marcus Group, Inc.
00 Xxxxxxxx Xxxxxx
Xxxxxxxx Xxxx, Xxxxxxxxxxxxx 00000
Telecopy: (000) 000-0000
with a copy to:
Xxxxxx Xxxx & Xxxxxxx
Exchange Place
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Telecopy: (000) 000-0000
Attn: Xxxxxx X. Xxxxxxx, Esq.
SECTION 6.2. Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; provided that no party may assign, delegate
or otherwise transfer any of its rights or obligations under this Agreement
without the consent of the other party hereto, except that Merger Sub may at any
time prior to the mailing of the Proxy Statement assign all of its rights and
obligations under this Agreement to any other wholly-owned subsidiary of
Harcourt General, and in the case of such assignment, the parties hereto agree
to amend this Agreement to so provide.
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SECTION 6.3. Governing Law. This Agreement shall be construed in
accordance with and governed by the laws of the State of Delaware.
SECTION 6.4. Counterparts; Effectiveness. This Agreement may be signed in
any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
This Agreement shall become effective when each party hereto shall have received
counterparts hereof signed by the other party hereto.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
THE NEIMAN MARCUS GROUP, INC.
By /s/ XXXX X. XXXXXX
------------------------------------
Name: Xxxx X. Xxxxxx
Title: Senior Vice President,
General Counsel and Secretary
HARCOURT GENERAL, INC.
By /s/ XXXX X. XXXX
------------------------------------
Name: Xxxx X. Xxxx
Title: Senior Vice President and
Chief Financial Officer
SPRING MERGER CORPORATION
By /s/ XXXX X. XXXX
------------------------------------
Name: Xxxx X. Xxxx
Title: President
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