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EXECUTION COPY
SUPPORT AGREEMENT dated as of October 27,
1996, among REVCO D.S., INC., a Delaware corporation
("Parent"), RDS ACQUISITION INC., a Delaware
corporation ("Sub") and a wholly owned subsidiary of
Parent, and the parties listed on Schedule A hereto
(each a "Shareholder" and, collectively, the
"Shareholders").
WHEREAS Parent, Sub and Big B, Inc., an Alabama corporation
(the "Company"), are concurrently entering into an Agreement and Plan of Merger
dated as of the date hereof (as the same may be amended or supplemented, the
"Merger Agreement") providing for the making of a cash tender offer (as such
offer may be amended or supplemented from time to time, the "Offer") by Sub for
all outstanding shares of Common Stock, par value $0.001 per share (the "Common
Stock"), of the Company together with the associated Rights (as defined in the
Merger Agreement) (the Common Stock, together with the associated Rights,
collectively, the "Shares") and the merger of the Company and Sub or another
subsidiary of Parent (the "Merger");
WHEREAS each Shareholder owns not less than the number of
Shares of the Company set forth opposite his or its name on Schedule A hereto;
such number of Shares, as it may be adjusted by conversion or by any stock
dividend, stock split, recapitalization, combination or exchange of Shares,
merger, consolidation or reorganization of or by the Company, being referred to
herein as the "Subject Shares"; and
WHEREAS, as a condition to their willingness to enter into the
Merger Agreement, Parent and Sub have requested that the Shareholders enter
into this Agreement.
NOW, THEREFORE, the parties hereto agrees as follows:
SECTION 1. Representations and Warranties of the Shareholder.
Each Shareholder hereby, severally and not jointly, represents and warrants to
Parent in respect of himself or itself as follows:
(a) Authority. Such Shareholder has all requisite power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. This Agreement has been duly executed and delivered by
such Shareholder and constitutes a valid and binding obligation of such
Shareholder enforceable in accordance with its terms. The execution and
delivery of this Agreement does not, and the consummation of the transactions
contemplated hereby and compliance with the terms hereof will not, conflict
with, or result in any violation of, or default (with or without notice or
lapse of time or both) under any provision of, any trust agreement, loan or
credit agreement, note, bond, mortgage, indenture, lease or other agreement,
instrument, permit, concession, franchise, license, judgment, order, notice,
decree, statute, law, ordinance, rule or regulation applicable to such
Shareholder or to such Shareholder's property or assets. Except for filings
with the Securities and Exchange Commission under Sections 13(d) and 16 of the
Securities Exchange
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Act of 1934, as amended, no consent, approval, order or authorization of, or
registration, declaration or filing with, any court, administrative agency or
commission or other governmental authority or instrumentality, domestic,
foreign or supranational, is required by or with respect to such Shareholder in
connection with the execution and delivery of this Agreement or the
consummation by such Shareholder of the transactions contemplated hereby.
(b) The Subject Shares. Such Shareholder has good and
marketable title to the Subject Shares, free and clear of any claims, liens,
encumbrances and security interests whatsoever.
(c) Revocation of Prior Proxies. Such Shareholder has
validly revoked any and all prior proxies granted with respect to the Subject
Shares.
SECTION 2. Representations and Warranties of Parent and Sub.
Parent and Sub hereby represent and warrant to each Shareholder that each of
Parent and Sub has all requisite corporate power and authority to enter into
this Agreement and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement by Parent and Sub, and the
consummation of the transactions contemplated hereby, have been duly authorized
by all necessary corporate action on the part of Parent and Sub. This
Agreement has been duly executed and delivered by Parent and Sub and
constitutes a valid and binding obligation of Parent and Sub enforceable in
accordance with its terms.
SECTION 3. Covenants of the Shareholder. Each Shareholder,
severally and not jointly, agrees as follows:
(a) Approval of Merger. At any meeting of shareholders
called to vote upon the Merger and the Merger Agreement or at any adjournment
thereof or in any other circumstances upon which a vote, consent or other
approval with respect to the Merger and the Merger Agreement is sought, such
Shareholder shall vote (or cause to be voted) all Shares then beneficially
owned by such Shareholder in favor of the Merger, the adoption by the Company
of the Merger Agreement and the approval of the terms thereof and each of the
other transactions contemplated by the Merger Agreement.
(b) Rejection of Other Proposals. At any meeting of
shareholders or at any adjournment thereof or in any other circumstances upon
which such Shareholder's vote, consent or other approval is sought, such
Shareholder shall vote (or cause to be voted) all Shares then beneficially
owned by such Shareholder against (i) any merger agreement or merger (other
than the Merger Agreement and the Merger), consolidation, combination, sale of
substantial assets, reorganization, recapitalization, dissolution, liquidation
or winding up of or by the Company or any other Takeover Proposal (as defined
in the Merger Agreement), (ii) any amendment of the Company's Articles
(Certificate) of Incorporation or By-laws or other proposal or transaction that
could impede, interfere with, prevent or materially delay the Merger or that
could reasonably be expected to dilute materially the benefits to Parent or
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Sub of the transactions contemplated by the Merger Agreement and (iii) against
any candidate for election to the Board of Directors of the Company not
approved by Parent.
(c) Negative Pledge. Such Shareholder shall not (i) sell,
transfer, pledge, assign or otherwise dispose of, or enter into any contract,
option or other arrangement (including any profit sharing arrangement) with
respect to the sale, transfer, pledge, assignment or other disposition of, the
Subject Shares to any person (A) other than Sub or Sub's designee or (B) by
operation of law upon the death of such Shareholder or (ii) enter into any
voting arrangement, whether by proxy, voting agreement or otherwise, in
connection, directly or indirectly, with any Takeover Proposal.
(d) No Solicitation. Such Shareholder shall not, nor shall
it permit any investment banker, attorney or other advisor or representative of
such Shareholder to, (i) directly or indirectly solicit, initiate or encourage
the submission of, any Takeover Proposal or (ii) directly or indirectly
participate in any discussions or negotiations regarding, or furnish to any
person any information with respect to, or take any other action to facilitate
any inquiries or the making of any proposal that constitutes, or may reasonably
be expected to lead to, any Takeover Proposal.
(e) Proxy. Such Shareholder hereby grants to Sub, with full
power of substitution, a proxy covering all the Subject Shares of such
Shareholder to vote such Subject Shares in accordance with this Section 3.
This proxy is coupled with an interest and shall be irrevocable to the maximum
extent permitted by the Alabama Business Corporation Act.
(f) Termination. The obligations of such Shareholder under
this Section 3, including the proxy granted pursuant to Section 3(e), shall
terminate on the termination of the Merger Agreement (the "Expiration Date");
provided, however, that, if any Shareholder fails to comply with Section 3(a),
the obligations of such Shareholder under this Section 3 shall not terminate
until the third anniversary of the date of this Agreement.
SECTION 4. Shareholder Capacity. No person executing this
Agreement who is or becomes during the term hereof a director or officer of the
Company makes any agreement or understanding herein in his or her capacity as
such director or officer. Each Shareholder signs solely in his or her capacity
as the record holder and beneficial owner of, or the trustee of a trust whose
beneficiaries are the beneficial owners of, such Shareholder's Subject Shares
and nothing herein shall limit or affect any actions taken by a Shareholder in
such Shareholder's capacity as an officer or director of the Company to the
extent specifically permitted by the Merger Agreement, including without
limitation Section 5.02 thereof.
SECTION 5. Further Assurances. Each Shareholder shall, from
time to time, execute and deliver, or cause to be executed and delivered, such
additional or further instruments as Parent or Sub may reasonably request for
the purpose of effectively carrying out the transactions contemplated by this
Agreement.
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SECTION 6. Assignment. Neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned by any of the
parties without the prior written consent of the other parties, except that Sub
may assign, in its sole discretion, any or all of its rights, interests and
obligations hereunder to Parent or to any direct or indirect subsidiary of
Parent. Subject to the preceding sentence, this Agreement shall be binding
upon, inure to the benefit of and be enforceable by the parties and their
respective successors and assigns.
SECTION 7. Enforcement. The parties agree that irreparable
damage would occur in the event that any of the provisions of this Agreement
were not performed in accordance with their specific terms or were otherwise
breached. It is accordingly agreed that the parties shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions of this Agreement in any court of the
United States located in the State of New York, this being in addition to any
other remedy to which they are entitled at law or in equity. In addition, each
of the parties hereto (i) consents to submit such party to the personal
jurisdiction of any Federal court in the event any dispute arises out of this
Agreement or any of the transactions contemplated hereby, (ii) agrees that such
party will not attempt to deny or defeat such personal jurisdiction by motion
or other request for leave from any such court, (iii) agrees that such party
will not bring any action relating to this Agreement or any of the transactions
contemplated hereby in any court other than a Federal court sitting in the
state of New York and (iv) waives any right to trial by jury with respect to
any claim or proceeding related to or arising out of this Agreement or any of
the transactions contemplated hereby. Each Shareholder shall pay all
reasonable fees and expenses of counsel to Parent and Sub incurred in enforcing
this Agreement against such Shareholder.
(b) Expenses. Except as set forth in Section 7(a), all costs
and expenses incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such expense.
(c) Amendments. This Agreement may not be amended except by
an instrument in writing signed by each of the parties hereto.
(d) Notice. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered personally or sent
by overnight courier
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(providing proof of delivery) or faxed to the parties at the following
addresses or fax numbers (or at such other address for a party as shall be
specified by like notice):
(i) if to Parent or Sub, to:
Revco D.S., Inc.
0000 Xxxxxxxxxx Xxxxxxx
Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
Attention: Xxxx X. Staph, Esq.
with a copy to:
Cravath, Swaine & Xxxxx
Worldwide Plaza
000 Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Fax: (000) 000-0000
Attention: Xxxxxxx Xxxx, Esq.
(ii) if to a Shareholder, to the address set forth under the
name of such Shareholder on Schedule A hereto
with copies to:
Sirote & Permutt
0000 Xxxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Fax: (000) 000-0000
Attention: Xxxxxxx Xxxx, Esq.
and
Skadden, Arps, Slate, Xxxxxxx & Xxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Fax (000) 000-0000
Attention: Xxxxxxx X. Xxxx, Esq.
(e) Interpretation. When a reference is made in this
Agreement to Sections, such reference shall be to a Section to this Agreement
unless otherwise indicated. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Wherever the words "include",
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"includes" or "including" are used in this Agreement, they shall be deemed to
be followed by the words "without limitation".
(f) Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same agreement,
and shall become effective when one or more of the counterparts have been
signed by each of the parties and delivered to the other party, it being
understood that each party need not sign the same counterpart.
(g) Entire Agreement; No Third-Party Beneficiaries. This
Agreement (including the documents and instruments referred to herein) (i)
constitutes the entire agreement and supersedes all prior agreements and
understandings, both written and oral, among the parties with respect to the
subject matter hereof and (ii) is not intended to confer upon any person other
than the parties hereto any rights or remedies hereunder.
(h) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware (except to the
extent Alabama law mandatorily applies), regardless of the laws that might
otherwise govern under applicable principles of conflicts of laws thereof.
(i) Severability. If any provision of this Agreement or the
application of any such provision to any person or circumstance shall be held
invalid, illegal or unenforceable in any respect by a court of competent
jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision hereof.
SECTION 8. Performance by Sub. Parent shall cause Sub to
perform in full each obligation of Sub set forth in this Agreement.
IN WITNESS WHEREOF, each party has duly executed this
Agreement as of the date first written above.
REVCO D.S., INC.,
by /s/ XXXXX X. XXXXXX
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Name: Xxxxx X. Xxxxxx
Title: Senior Vice President,
Finance
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RDS ACQUISITION INC.,
by /s/ XXXXX X. XXXXXX
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Name: Xxxxx X. Xxxxxx
Title: Treasurer
/s/ XXXXXXX X. XXXXX
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Xxxxxxx X. Xxxxx
/s/ XXXXXX X. XXXXX, XX.
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Xxxxxx X. Xxxxx, Xx.
/s/ XXXXX X. XXXXX
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Xxxxx X. Xxxxx
/s/ XXXXXXX X. XXXXX
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Xxxxxxx X. Xxxxx, in his individual
capacity and in his capacity as
custodian for the entities listed on
Schedule B.
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Schedule A
List of Shareholders
Subject Shares
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Xxxxxxx X. Xxxxx 636,504
0000 Xxxxx Xxxx Xxxx
Xxxxxxxxxx, XX 00000
Xxxxxx X. Xxxxx, Xx. 60,508
0000 Xxxxxx Xxxx Xxxxx
Xxxxxx, XX 00000
Xxxxxxx X. Xxxxx 418,854
0000 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Xxxxx X. Xxxxx 71,620
0000 Xxx Xxxxxxx Xxxx Xxxxx
Xxxxxxxx Xxxxx, XX 00000
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Schedule B
List of Shareholder Trusts
Xxxxxxx Xxxxx, C/F Xxx Xxxx Xxxxx AUGMA 48,300
Xxxxxxx Xxxxx, C/F Xxxxxxx Xxxxx AUGMA 26,200
Xxxxxxx Xxxxx, C/F Xxxx Xxxxxxx Xxxxx AUGMA 24,200
Xxxxxxx Xxxxx, C/F Xxxxxxx Xxxxxx Xxxxx AUGMA 15,400
