EXHIBIT 3
AGREEMENT AND PLAN OF MERGER
This AGREEMENT AND PLAN OF MERGER (this "Agreement") is made and entered
into as of May __, 1998 by and between Star Theatres, Inc., a Delaware
corporation ("Star Theatres"), Loews Theatre Enterprises, Inc., a Delaware
corporation ("Loews Theatre Enterprises") and Sony Pictures Entertainment Inc.,
a Delaware corporation ("SPE").
BACKGROUND
Star Theatres is a wholly owned subsidiary of SPE and Loews Theatre
Enterprises is a wholly owned subsidiary of LTM Holdings, Inc., a Delaware
corporation ("Loews Theatres" and, together with SPE, the "Shareholders"). The
Boards of Directors and shareholders of each of Star Theatres and Loews Theatre
Enterprises have approved the merger (the "Merger") of Star Theatres with and
into Loews Theatre Enterprises pursuant to the terms of this Agreement. The
Board of Directors of Star Theatres has approved and adopted this Agreement as a
plan of reorganization within the meaning of Section 368(a) of the Internal
Revenue Code of 1986, as amended (the "Code"). Prior to the date hereof, Loews
Theatres transferred 2,373,217 shares of its common stock (the "LTM Merger
Shares") to Loews Theatre Enterprises.
NOW, THEREFORE, in consideration of the foregoing, and of the
representations, warranties and agreements contained herein, and intending to be
legally bound hereby, the parties hereby agree as follows:
I. THE MERGER
1.1 The Merger. Upon the terms hereof, and in accordance with the
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relevant provisions of Section 251 of the Delaware General Corporation Law (the
"DGCL"), Star Theatres shall be merged with and into Loews Theatre Enterprises.
Following the Merger, Loews Theatre Enterprises shall continue as the surviving
corporation (the "Surviving Corporation") and shall continue its existence under
the laws of the State of Delaware, and the separate existence of Star Theatres
shall cease.
1.2 Effective Time. The Merger shall be consummated by filing with the
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Secretary of State of the State of Delaware a certificate of merger (the
"Certificate of Merger") in accordance with Section 251 of the DGCL. The Merger
shall become effective at such time (the "Effective Time") as the Certificate of
Merger is duly filed.
1.3 Effects of the Merger. The Merger shall have the effects set forth in
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Section 259 of the DGCL.
1.4. Certificate of Incorporation and By-Laws. The Certificate of
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Incorporation and the By-Laws of Loews Theatre Enterprises shall be the
Certificate of Incorporation and By-Laws of the Surviving Corporation until
thereafter changed or amended as provided therein or by applicable law.
1.5 Directors and Officers. The directors and officers of Loews Theatre
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Enterprises immediately prior to the Effective Time shall be the directors and
officers of the Surviving Corporation until the earlier of their resignation or
removal or until their respective successors are duly elected and qualified.
1.6 Conversion of Shares. At the Effective Time, by virtue of the Merger
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and without any action on the part of any of the holders of any capital stock of
Star Theatres, the shares of common stock of Star Theatres issued and
outstanding immediately prior to the Effective Time, in the aggregate, shall be
converted into the right to receive, in the aggregate, the LTM Merger Shares.
1.7 Closing Deliveries. At the closing of the Merger (the "Closing"), SPE
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shall deliver to Loews Theatre Enterprises the minute books, stock transfer
records and all other corporate books and records of Star Theatres.
1.8 Intention. The parties hereto intend that the Merger will be treated
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as a transaction that qualifies under Code Sections 368(a)(1)(A) and
368(a)(2)(D) and agree to so report the Merger for all tax purposes to the
extent permitted by applicable law.
II. REPRESENTATIONS AND WARRANTIES
SPE hereby represents and warrants to Loews Theatre Enterprises as follows:
(a) SPE owns directly all the outstanding shares of capital stock of Star
Theatres (the "Star Shares").
(b) Each of the Star Shares is duly authorized, validly issued, fully paid
and nonassessable.
(c) Each of the Star Shares is owned directly by SPE free and clear of all
encumbrances.
(d) Immediately following the Closing, Loews Theatres will have good and
marketable title to all of the issued and outstanding shares of capital stock of
the Surviving Corporation, free and clear of all liens, pledges, security
interests,
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rights of first refusal, options, claims, hypothecs or other encumbrances, other
than LTM Permitted Encumbrances, as such term is defined in that certain Amended
and Restated Master Agreement dated as of September 30, 1997 by and among SPE,
Loews Theatres and Cineplex Odeon Corporation (the "Master Agreement").
(e) Immediately following the Closing, all of the motion picture exhibition
assets owned by Star Theatres and used in connection with or relating to Star
Theatres' motion picture exhibition business will be owned by Loews Theatre
Enterprises.
III. MISCELLANEOUS
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns. No representations
and warranties set forth in this Agreement shall survive the Closing. All
covenants and agreements set forth in this Agreement shall survive the Closing.
This Agreement and the rights and obligations of the parties hereto shall be
governed by, and construed in accordance with, the laws of the State of
Delaware, without giving effect to the principles of conflict of law thereof.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first above written.
LOEWS THEATRE
ENTERPRISES, INC.
BY /s/ Xxxx X. XxXxxxx, Xx.
________________________________
Name: Xxxx X. XxXxxxx, Xx.
Title: Senior Vice President, General
Counsel and Assistant Secretary
STAR THEATRES, INC.
BY /s/ Xxxxxx X. Xxxxxx
_________________________________
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President and
General Counsel
SONY PICTURES
ENTERTAINMENT INC.
BY /s/ Xxxxxx X. Xxxxxx
_________________________________
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President and
General Counsel
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