Exhibit 2.2
FIRST AMENDMENT (the "Amendment"), dated as of October 29,
1997, by and among Big Flower Holdings, Inc., a Delaware
corporation ("Holdings"), Big Flower Press Holdings, Inc., a
Delaware corporation and a wholly-owned subsidiary of
Holdings ("Big Flower Press"), Columbine JDS Systems, Inc.,
a Delaware corporation (the "Company"), Columbine BIAS,
Ltd., a Texas limited partnership, Xxxxxxx X. Xxxx,
Xxxxxxxxx X. Xxxx, Xxxxxxxxx X. Xxxx Trust, Xxxxx X. Xxxxxx,
Xxxx Xxxxxx and Xxxxxx Xxxxxx (individually, a "Share
Seller" and, collectively, "Share Sellers"), and each of the
optionees that is a signatory hereto (the "Option Holders"),
to the Stock Purchase Agreement, dated September 19, 1997,
among Buyer, the Company, Share Sellers and Option Holders
(the "Original Agreement").
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INTRODUCTION
Big Flower Press, the Company, Share Sellers, Option Holders entered
into the Original Agreement relating to the sale to Big Flower Press (or its
permitted assigns) of all of the Common Stock and Preferred Stock of the Company
and the sale or exchange of all of the outstanding Options to purchase the
Common Stock.
The Original Agreement provided that a portion of the consideration to
be paid by Big Flower Press for the Common Stock and Options would be in the
form of shares of Buyer Common Stock, in amounts to be determined as set forth
in the Original Agreement.
The Original Agreement also provided that Option Holders who so
elected could exchange their Options for Buyer Options.
The Buyer, effective October 17, 1997, created a new holding company
structure pursuant to Section 251(g) of the Delaware General Corporation Law by
merging (the "Merger") Buyer with and into Big Flower Merger Co., a Delaware
corporation and, prior to such merger, a direct, wholly-owned subsidiary of
Holdings ("Mergeco"), with Buyer being the surviving corporation in the Merger.
As a result of the Merger, each share of Buyer Common Stock outstanding
immediately prior to the effective time of the Merger as of the date hereof
represents a like number of shares of Holdings Common Stock (as defined below),
all in accordance with the terms of the Agreement and Plan of Reorganization,
dated as of October 17, 1997, among Buyer, Holdings and Mergeco attached hereto
as Exhibit A. Accordingly, in connection with the Original Agreement, shares of
Holdings Common Stock will be issued and Holdings Options (as defined below)
will be granted in lieu of Buyer Common Stock and Buyer Options, respectively.
Big Flower Press desires to assign to Holdings, and Holdings desires
to assume from Big Flower Press, all of Big Flower Press's rights and
obligations under the Original Agreement.
The parties desire to amend the Original Agreement in certain respects
as hereinafter set forth.
Capitalized terms used herein and not otherwise defined shall have the
respective meanings set forth in the Original Agreement. References to the
"Agreement" contained in the Original Agreement and this Amendment shall mean
the Original Agreement as amended by this Amendment.
In consideration of the mutual covenants and promises contained herein, and for
other good and valuable consideration, the parties agree as follows:
1. (a) Big Flower Press hereby assigns, transfers and sets off onto
Holdings, its successors and assigns all rights, benefits and privileges of Big
Flower Press as Buyer under the Original Agreement (the "Assignment"). Holdings
hereby accepts the Assignment, and assumes and agrees to perform, pay, discharge
and comply with all of the covenants, conditions, agreements, terms, obligations
and restrictions to be performed or complied with on the part of Big Flower
Press, as Buyer, under the Original Agreement (the "Assumption").
Notwithstanding this Assignment and Assumption, Big Flower Press is in no way
relieved of its obligations under the Original Agreement.
(b) The parties hereto agree to the Assignment and Assumption.
2. (a) Section 1.1 of the Original Agreement is hereby amended by
adding the following defined terms and the meanings specified below:
"HOLDINGS" means Big Flower Holdings, Inc., a Delaware corporation
"HOLDINGS COMMON STOCK" means the common stock, par value $0.01 per
share, of Holdings.
"HOLDINGS OPTIONS" means stock options to purchase from Holdings
shares of Holdings Common Stock.
"HOLDINGS PREFERRED STOCK" means the preferred stock, par value $0.01
per share, of Holdings.
"HOLDINGS SHARE PRICE" means the average of the per share closing
price of a share of Holdings Common Stock (or Buyer Common Stock with respect to
any trading day occurring prior to October 20, 1997), on the NYSE Composite Tape
for the 20 consecutive trading days immediately prior to the Closing Time.
(b) Section 1.1 of the Original Agreement is hereby amended by
amending and restating the definitions of "Buyer Common Stock" and "Buyer
Options" as follows:
"BUYER COMMON STOCK" means the common stock, par value $0.01 per
share, of Buyer.
"BUYER OPTIONS" means the stock options to purchase from Buyer shares
of Buyer Common Stock.
3. The parties hereby acknowledge and confirm that, except with
respect to Section 5.8(a) of the Original Agreement and except for the
definition of "Holdings Share Price," each reference in the Original Agreement
to "Buyer Common Stock," "Buyer Options" and "Buyer Share
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Price" shall hereby be amended to read "Holdings Common Stock," "Holdings
Options" and "Holdings Share Price," respectively.
4. Section 8.8 of the Original Agreement is amended by adding the
following:
"(e) Certificates, dated the Closing Time, from Holdings, duly
executed by the Chief Executive Officer and the Chief Financial Officer of
Holdings, and a certificate, dated the Closing Time and executed by the
Secretary or an Assistant Secretary of Holdings, substantially in the form and
to the effect of Exhibits M and N to this Agreement, respectively."
5. Section 9.4 of the Original Agreement is deleted in its entirety
and replacing therefor the following:
"9.4. ASSUMED OPTIONS. (a) In the event that Buyer is notified on
or before the earlier to occur of (i) October 24, 1997 and (ii) three business
days prior to the Closing, that any or all of the Option Holders elect to have
their Options exchanged for Holdings Options, Buyer and Holdings shall take all
necessary actions to cause the exchange of the Options held by such Option
Holder for Holdings Options. As a result of such exchange, each Option Holder
shall receive for each Option, that amount of Holdings Options in which the
excess of the (x) Holdings Share Price over the (y) exercise price of such
Holdings Option shall equal the Option Spread, all in accordance with Section
424(a) of the Internal Revenue Code and the regulations promulgated thereunder,
without regard to whether the Option qualifies as an incentive stock option
within the meaning of Section 422 of the Internal Revenue Code.
(b) The provisions of Section 9.4(a) may be amended as reasonably
required so that the exchange of Options thereunder complies with the
requirements of Section 424(a) of the Internal Revenue Code and the regulations
promulgated thereunder. After the Closing Time, Holdings will deliver to each
holder of an Option a document evidencing the foregoing exchange by Holdings.
Holdings will take all corporate and other action necessary to reserve and make
available sufficient shares of Holdings Common Stock for issuance upon the
exercise of the Holdings Options.
(c) As promptly as reasonably practicable after the completion of the
exchange of Options for Holdings Options pursuant to this Section 9.4, Holdings
shall file a new Registration Statement on Form S-8 (or any successor or other
appropriate forms) with respect to, the shares of Holdings Common Stock subject
to the Holdings Options issued pursuant to this Section 9.4 and shall use
reasonable efforts to maintain the effectiveness of such registration statement
or registration statements (and maintain the current status of the prospectus or
prospectuses relating thereto) for so long as such Holdings Options remain
outstanding."
6. Exhibit L to the Original Agreement is amended by deleting it in
its entirety and substituting therefor Exhibit D hereto. The Original Agreement
is amended by adding Exhibits M and N thereto, which Exhibits are attached to
this Agreement as Exhibits B and C, respectively.
7. Buyer hereby represents and warrants to the Company, Sellers and
Columbine BIAS, Ltd., as attorney-in-fact of the Option Holders, as follows:
(a) Holdings is a corporation duly organized, validly existing, and
in good standing under the laws of the state of its incorporation.
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(b) Holdings has the full right, power and authority to execute and
deliver this Agreement and to perform its obligations under this Agreement.
This Agreement constitutes the legal, valid and binding obligation of
Holdings, enforceable against Holdings in accordance with its terms.
(c) (i) Neither the execution and delivery of this Agreement by
Holdings nor the consummation or performance of any of the transactions
contemplated hereby by Holdings will (A) conflict with or violate any
provision of the corporate charter or bylaws of Holdings; (B) violate,
conflict with, nor result in any default, violation, breach or
contravention of, nor permit the acceleration of the maturity of, or the
creation or imposition of any lien under, any material indenture, contract,
agreement, lease or instrument to which Holdings is a party or by which
Holdings is bound, nor constitute such an event, except for approvals
required under the HSR Act and except for violations, conflicts and other
matters that will not have a material adverse effect on the business,
assets, liabilities, operations, financial condition or prospects of
Holdings and consents, approvals, orders, authorizations, filings and
permits, which the failure to obtain or make will not have a material
adverse effect on the business, assets, liabilities, operations, financial
condition or prospects of Holdings; or (C) violate any statute, law,
judgment, decree, order, writ, injunction, rule or regulation of any court
or governmental authority to which Holdings may be subject.
(ii) Except for approvals required under the HSR Act, there is no
requirement applicable to Holdings to make any filing with, or to obtain
any permit, authorization, consent or approval of any Governmental Entity
or any other Person in connection with the execution, delivery, or
performance of this Agreement or as a condition to the lawful consummation
by Holdings of the transactions contemplated by this Agreement.
(iii) There is no Proceeding pending or, to the knowledge of
Holdings, threatened against Holdings that seeks to prevent the
consummation of the transactions contemplated by the Agreement.
(d) (i) The authorized capital stock of Holdings consists of (A)
50,000,000 shares of Holdings Common Stock; of which, as of October 23,
1997, 18,506,736 shares were issued and outstanding; 4,478,463 shares were
reserved for issuance under Holdings' Restated 1993 Stock Award and
Incentive Plan, a copy of which has been previously provided to the Company
and each of the Option Holders (the "Holdings Approved Plan"), of which,
options for 2,483,031 shares of Holdings Common Stock have been granted and
are outstanding and 83,306 options granted under the Holdings Approved Plan
have been exercised and up to 21,668 shares of Holdings Common Stock were
reserved for issuance in exchange for shares of Scanforms, Inc. and no
shares were held in treasury and (B) 10,000,000 shares of Holdings
Preferred Stock, none of which is outstanding but of which 250,000 shares
have been designated as Series A Junior Preferred Stock. Except as set
forth above and except as required by this Agreement, at the time of
execution of this Amendment, no shares of capital stock or other voting
securities of Holdings are issued, reserved for issuance or outstanding.
All outstanding shares of capital stock of Holdings are, and all shares
which may be issued pursuant to this Agreement or pursuant to the exercise
of Holdings Options will be, when issued, duly authorized, validly issued,
fully paid and non-assessable and not subject to preemptive rights. Except
as set forth above, as of the date of this Amendment, except for
transactions contemplated by this Agreement and except for 270,206 shares
of Holdings Common Shares to be issued in connection with Holdings
acquisition of substantially all of the assets of Gamma One, Inc., there
are no outstanding securities, options or agreements to which Holdings or
any of its subsidiaries is a party or by which any of them is bound
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obligating Holdings or any of its subsidiaries to issue or cause to be
issued additional shares of capital stock of Holdings or of any of its
subsidiaries.
(ii) The shares of Holdings Common Stock being issued as part of the Share
and Option Purchase Price have been duly authorized and, when issued in
connection with the consummation of the transactions contemplated by this
Agreement, will be validly issued, fully paid and non-assessable and free
of preemptive rights. None of the shares of Holdings Common Stock being
issued as part of the Share and Option Purchase Price will be subject to
restrictions imposed by any agreements entered into by Holdings prior to
the Closing Time for financing or otherwise, other than this Agreement.
8. Holdings Common Stock is registered under the Exchange Act of
1934.
9. Buyer and Holdings hereby agree to take all such other actions as
are reasonably necessary to effect the issuance of Holdings Common Stock and
Holdings Options pursuant to this Agreement.
10. All provisions of the Agreement not specifically amended by this
Amendment shall remain in full force and effect.
11. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF DELAWARE OTHER THAN THE CONFLICT OF LAWS RULES
THEREOF.
12. This Amendment may be executed in multiple counterparts, each of
which shall be deemed to be an original, and all of which together shall
constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties to this Amendment have caused this
Amendment to be executed as of the date first above written.
HOLDINGS:
BIG FLOWER HOLDINGS, INC.
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Vice President
BUYER:
BIG FLOWER PRESS HOLDINGS, INC.
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Vice President
THE COMPANY:
COLUMBINE JDS SYSTEMS, INC.
By: /s/ Xxxx X. Hobby
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Name: Xxxx X. Hobby
Title: Chairman
S-1
SHARE SELLERS:
COLUMBINE BIAS, LTD.
By: Columbine BIAS, Partners,
Its: General Partner
By: Hobby Media Services, Inc.
Its: General Partner
By: /s/ Xxxx X. Hobby
--------------------------
Name: Xxxx X. Hobby
Title: Chairman
/s/ Xxxxxxx X. Xxxx
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XXXXXXX X. XXXX
/s/ Xxxxxxxxx X. Xxxx
----------------------------------------
XXXXXXXXX X. XXXX
XXXXXXXXX X. XXXX TRUST*
By: /s/ Xxxxxxxxx X. Xxxx ,Trustee
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/s/ Xxxxx X. Xxxxxx
----------------------------------------
XXXXX X. XXXXXX
/s/ Xxxx Xxxxxx
----------------------------------------
XXXX XXXXXX
*By: COLUMBINE BIAS, LTD., as attorney-in-fact
By: Columbine BIAS, Partners,
Its: General Partner
By: Hobby Media Services, Inc.
Its: General Partner
By: /s/ Xxxx X. Hobby
--------------------------
Name: Xxxx X. Hobby
Title: Chairman
S-2
/s/ Xxxxxx Xxxxxx
----------------------------
XXXXXX XXXXXX
By: Columbine BIAS, Ltd., as
attorney-in-fact
By: Columbine BIAS, Partners,
Its: General Partner
By: Hobby Media Services, Inc.
Its: General Partner
By: /s/ Xxxx X. Hobby
-------------------------
Name: Xxxx X. Hobby
Title: Chairman
OPTION HOLDERS,
as listed on Schedule 3.2 to the
Original Agreement
By: Columbine BIAS, Ltd., as
attorney-in-fact
By: Columbine BIAS, Partners,
Its: General Partner
By: Hobby Media Services, Inc.
Its: General Partner
By: /s/ Xxxx X. Hobby
----------------------
Name: Xxxx X. Hobby
Title: Chairman
S-3
