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| JAX > SEC Filings for JAX > Form 8-K on 2-Aug-2012 | All Recent SEC Filings |
2-Aug-2012
Entry into a Material Definitive Agreement, Material Modification to Rights of
The Restated Merger Agreement
On July 30, 2012, J. Alexander's Corporation, a Tennessee corporation ("J. Alexander's" or the "Company"), entered into an Amended and Restated Agreement and Plan of Merger (the "Restated Merger Agreement"), by and among J. Alexander's, Fidelity National Financial, Inc., a Delaware corporation ("Fidelity" or "Parent"), New Athena Merger Sub, Inc., a Tennessee corporation and an indirect, wholly owned subsidiary of Fidelity ("Merger Sub"), American Blue Ribbon Holdings, Inc., a Delaware corporation and an indirect, majority-owned subsidiary of Parent ("ABRH"), Athena Merger Sub, Inc., a Tennessee corporation and a direct, wholly owned subsidiary of ABRH ("Old Merger Sub"), and Fidelity Newport Holdings, LLC, a Delaware limited liability company and an indirect, majority-owned restaurant operating subsidiary of Fidelity (the "Operating Company"). The Restated Merger Agreement amends and restates in its entirety that certain Agreement and Plan of Merger, dated June 22, 2012, by and among J. Alexander's, Fidelity, ABRH, Old Merger Sub, and the Operating Company (the "Prior Merger Agreement") previously described in the Company's Current Report on Form 8-K filed on June 28, 2012. The merger and related transactions contemplated by the Restated Merger Agreement are intended to and will supersede the transactions intended by the Prior Merger Agreement.
The Offer and the Merger
Pursuant to the Restated Merger Agreement, upon the terms and subject to the conditions thereof, Merger Sub will commence a tender offer (the "Offer") to acquire all of the outstanding shares of common stock, $0.05 par value per share, of the Company ("Company Common Stock") at a purchase price of $13.00 per share, net to the seller thereof in cash (the "Offer Price"), without interest and subject to any required withholding of taxes. The Restated Merger Agreement provides that the Offer will commence no later than August 6, 2012. The Restated Merger Agreement provides that the initial tender offer period of the Offer will remain open until 5:00 p.m., New York City time, on the 21st business day following the commencement of the Offer, subject to certain extension rights and obligations set forth in the Restated Merger Agreement, provided that the expiration date of the Offer may not be extended beyond November 30, 2012. The time at which the shares of Company Common Stock tendered in the initial tender offer period are accepted for payment is referred to as the "Acceptance Time."
The Restated Merger Agreement provides that after the Acceptance Time and
subject to statutory waiting periods and the satisfaction or waiver of certain
conditions set forth in the Restated Merger Agreement, Merger Sub will merge
with and into the Company (the "Merger") and the Company will become an
indirect, wholly owned subsidiary of Parent. In the Merger, each outstanding
share of Company Common Stock that was not tendered pursuant to the Offer, other
than shares of Company Common Stock owned by the Company or Merger Sub, will be
converted into the right to receive cash in an amount equal to the Offer Price,
subject to any required withholding of taxes and without interest. The closing
of the Merger (the "Effective Time") is subject to approval of the Merger by the
holders of a majority of the Company Common Stock; however, if Merger Sub holds
at least 90% of the outstanding Company Common Stock immediately prior to the
Merger, Merger Sub may effect the Merger as a short-form merger pursuant to
Section 48-21-105 of the Tennessee Business Corporation Act, without additional
approval by the Company's shareholders. Otherwise, the Company will hold a
shareholders' meeting to obtain shareholder approval of the Merger and related
matters. The Merger is also conditioned upon the absence of certain legal
restraints and the acceptance of payment by Merger Sub of all the shares of
Company Common Stock validly tendered pursuant to the Offer.
Immediately prior to the Acceptance Time, each outstanding option to purchase Company Common Stock, whether vested or unvested, shall become fully vested and exercisable and, to the extent not exercised prior to the Acceptance Time, shall be canceled in exchange for a payment of cash by the Company equal to the product of (a) the excess, if any, of $13.00 over the exercise price per share of Company Common Stock for such option and (b) the number of shares of Company Common Stock then subject to such option. Each option to purchase Company Common Stock having an exercise price greater than $13.00 shall be cancelled at the Acceptance Time without any cash payment in respect thereof.
Offer Conditions and Closing Conditions
The obligation of Merger Sub to purchase shares tendered in the Offer is not subject to a financing condition, but is subject to the satisfaction or waiver of various customary conditions set forth in the Restated Merger Agreement, including (i) the expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), and certain other antitrust laws, (ii) the absence of any restraint or law preventing or prohibiting the consummation of the Offer, the Merger or the exercise of the Top-Up Option (discussed below), (iii) subject to certain exceptions, the accuracy of the Company's representations and warranties, (iv) the Company's compliance in all material respects with its obligations under the Restated Merger Agreement, and (v) the Restated Merger Agreement not being terminated in accordance with its terms. Furthermore, it is a condition to Merger Sub's obligation to purchase the shares tendered in the Offer that the number of the outstanding shares of Company Common Stock that have been validly tendered and not validly withdrawn equals at least a majority of the Company Common Stock outstanding as of the expiration of the Offer on a fully-diluted basis (as determined under the Restated Merger Agreement to include, in addition to shares outstanding, shares reserved for issuance pursuant to stock options and other convertible securities, if any). Because certain filings were already made in connection with the Prior Merger Agreement, the applicable waiting period under the HSR Act has already expired.
Top-Up Option
The Company has also granted to Parent an irrevocable right (the "Top-Up Option"), which Parent may exercise following consummation of the Offer, if necessary, to purchase from the Company, at a price per share equal to the Offer Price, up to that number of newly issued shares of Company Common Stock (the "Top-Up Shares") that, when added to the number of shares of Company Common Stock owned by Parent (or any of its subsidiaries) at the time of exercise of . . .
Immediately prior to the execution of the Restated Merger Agreement, the Company amended the Rights Agreement, dated as of March 5, 2012, between the Company and Computershare Trust Company, N.A., as amended by that certain First Amendment to the Rights Agreement, effective June 22, 2012 (the "Rights Agreement"), excepting the Restated Merger Agreement and the carrying out of the transactions, including the Offer and the Merger, in the manner contemplated thereby from the provisions of the Rights Agreement.
The foregoing description of the Second Amendment to the Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Second Amendment to the Rights Agreement, which is filed as Exhibit 4.1 hereto and is incorporated herein by reference.
In connection with the execution of the Restated Merger Agreement, the Company, Parent, ABRH and the Operating Company entered into amended letter agreements with each of the Company's executive officers, respectively (the "Amended Letter Agreements"), which amended and restated those prior letter agreements entered into on June 22, 2012 in connection with the Prior Merger Agreement, and provide that, subject to the consummation of the Merger described in Item 1.01 above, certain provisions of employment, severance and/or retirement agreements between the Company and each executive would be amended.
Pursuant to the Amended Letter Agreements, conditioned upon the consummation of the Merger, the provision permitting termination of employment by the employee for "good reason" included in Employment Agreements between the Company and Messrs. Lonnie J. Stout II and J. Michael Moore, and in a Severance Benefits Agreement between the Company and Mr. Stout, will be revised to exclude from the definition of "Good Reason" the assignment of the executive officer to a position at the Operating Company in its main corporate office or upscale division office in Nashville, Tennessee with similar duties and responsibilities and substantially similar salary and benefits or their equivalent value as the executive's salary and benefits prior to the Merger.
In addition, the Amended Letter Agreements will amend certain Salary Continuation Agreements between the Company and each of its executive officers, conditioned upon the consummation of the Merger, (i) with respect to Messrs. Stout and Moore, to amend the definition of "Base Salary" included in the Salary Continuation Agreement so that it will be fixed as of the date of the Merger and, (ii) with respect to Messrs. Stout, R. Gregory Lewis, Moore and Mark A. Parkey, to suspend the obligation of the Company and its successors to establish and fund a "rabbi trust" with respect to certain retirement benefits upon a change in control of the Company, in exchange for Parent's guarantee of the Company's obligations under the Salary Continuation Agreements until (a) the Operating Company beneficially owns any interest in the Company, at which time the Operating Company will also guarantee the performance of the obligations of the Company under the Salary Continuation Agreements, and (b) Parent no longer retains direct or indirect beneficial ownership of at least 40% of the Company, at which time, upon the occurrence of both (a) and (b), the Company's obligations under the Salary Continuation Agreement to fund a rabbi trust shall resume, and upon the establishment and funding by the Company of the "rabbi trust," Parent's guarantee shall terminate; provided, however, that the Operating Company's guarantee of the Company's obligations under the Salary Continuation Agreements will continue in force until all such obligations are satisfied.
Each of the foregoing Amended Letter Agreements was required by Parent, ABRH and the Operating Company prior to their entry into the Restated Merger Agreement and effectively limits the contractual benefits to the executive officers under the amended agreements.
The foregoing description of the Amended Letter Agreements does not purport to be complete and is qualified in its entirety by reference to the full text of each Letter Agreement, which are filed as Exhibits 10.2, 10.3, 10.4, and 10.5 hereto and are incorporated herein by reference.
(d) Exhibits. The following exhibits are filed as part of this report:
2.1 Amended and Restated Agreement and Plan of Merger, dated as of July 30, 2012, by and among Fidelity National Financial, Inc., New Athena Merger Sub, Inc., Fidelity Newport Holdings, LLC, American Blue Ribbon Holdings, Inc., Athena Merger Sub, Inc., and J. Alexander's Corporation*
4.1 Second Amendment to the Rights Agreement, dated as of July 30, 2012, between J. Alexander's Corporation and Computershare Trust Company, N.A.
10.1 Omnibus Termination and Release Agreement, dated as of July 30, 2012, by and among Fidelity National Financial, Inc., Fidelity National Special Opportunities, Inc., Newport Global Opportunities Fund, LP, American Blue Ribbons Holdings, Inc., Fidelity Newport Holdings, LLC and J. Alexander's Corporation
10.2 Letter Agreement, dated as of July 30, 2012, by and among J. Alexander's Corporation, Fidelity National Financial, Inc., Fidelity Newport Holdings, LLC, American Blue Ribbon Holdings, Inc. and Lonnie J. Stout II
10.3 Letter Agreement, dated as of July 30, 2012, by and among J. Alexander's Corporation, Fidelity National Financial, Inc., Fidelity Newport Holdings, LLC, American Blue Ribbon Holdings, Inc. and R. Gregory Lewis
10.4 Letter Agreement, dated as of July 30, 2012, by and among J. Alexander's Corporation, Fidelity National Financial, Inc., Fidelity Newport Holdings, LLC, American Blue Ribbon Holdings, Inc. and J. Michael Moore
10.5 Letter Agreement, dated as of July 30, 2012, by and among J. Alexander's Corporation, Fidelity National Financial, Inc., Fidelity Newport Holdings, LLC, American Blue Ribbon Holdings, Inc. and Mark A. Parkey
*Certain schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Company agrees to furnish a supplemental copy of any omitted schedule to the Securities and Exchange Commission upon request.
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