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Title: |
Agreement and Plan of Merger |
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Entities: |
Citibank, NA; Donna Karan International Inc; LVMH Moet Hennessy LV |
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Date: |
2001 |
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Size: |
Preview shows 10KB of 181KB total |
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Price: |
$43 |
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ID: |
#1630438 |
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AGREEMENT AND PLAN OF MERGER
DATED AS OF MARCH 31, 2001
BY AND AMONG
DONNA KARAN INTERNATIONAL INC.,
LVMH MOET HENNESSY LOUIS VUITTON INC.
AND
DKI ACQUISITION, INC.
<PAGE>
<TABLE>
TABLE OF CONTENTS
<S> <C> <C>
1. CERTAIN DEFINED TERMS..............................................2
2. THE MERGER.........................................................7
2.1. The Merger.........................................................7
2.2. Closing............................................................8
2.3. Effective Time of the Merger.......................................8
2.4. Effects of the Merger..............................................8
3. EFFECT OF THE MERGER ON THE CAPITAL STOCK OF THE
CONSTITUENT CORPORATIONS; EXCHANGE OF CERTIFICATES.................9
3.1. Effect on Capital Stock............................................9
3.2. Conversion of Shares...............................................9
3.3. Payment for Shares................................................10
3.4. Stock Transfer Books..............................................11
3.5. STOCK OPTION PLANS AND OTHER EQUITY-BASED AWARDS..................11
3.6. Dissenting Shares.................................................12
4. REPRESENTATIONS AND WARRANTIES....................................13
4.1. General Statement.................................................13
4.2 Representations and Warranties of the Company.....................13
4.3. Representations and Warranties of LVMH and Acquisition Sub........25
5. COVENANTS RELATING TO CONDUCT OF BUSINESS.........................27
5.1. Affirmative Covenants of the Company..............................27
5.2. Certain Other Covenants of the Company............................28
5.3. LVMH Consents.....................................................31
6. ADDITIONAL AGREEMENTS.............................................31
6.1. Access to Information; Confidentiality............................31
6.2. Acquisition Proposal..............................................32
6.3. Fees and Expenses.................................................33
6.4. Brokers or Finders................................................33
6.5. Indemnification and Insurance.....................................33
6.6. Reasonable Best Efforts; Cooperation..............................35
6.7. Publicity.........................................................36
6.8. Intentionally Omitted.............................................36
6.9. Notification of Certain Matters...................................36
6.10. Trustees..........................................................37
6.11. Preparation and Filing of Proxy Statement and
Schedule 13E-3; Stockholders' Meeting.............................37
6.12. Intentionally Omitted.............................................37
6.13. Employment Matters................................................38
6.14. Covenants of LVMH.................................................38
6.15. Obligations of LVMH and Acquisition Sub...........................38
7. CONDITIONS PRECEDENT..............................................38
7.1. Conditions to the Company's Obligations...........................38
7.2. Conditions to LVMH's and Acquisition Sub's Obligations............39
7.3. Conditions to Each Party's Obligations............................39
8. TERMINATION AND AMENDMENT.........................................40
8.1. Termination.......................................................40
8.2. Effect of Termination.............................................41
8.3. Amendment.........................................................42
8.4. Extension; Waiver.................................................42
8.5. Special Committee.................................................43
9. MISCELLANEOUS.....................................................43
9.1. Notices...........................................................43
9.2. Nonsurvival of Covenants and Agreements...........................44
9.3. Entire Agreement; No Third Party Beneficiaries....................44
9.4. Assignment........................................................45
9.5. Director, Officer and Stockholder Liability.......................45
9.6. Specific Performance..............................................45
9.7. Effectiveness.....................................................45
9.8. Legal Holiday.....................................................45
9.9. Construction......................................................45
9.10. Governing Law.....................................................46
9.11. Remedies Cumulative...............................................46
9.12. Counterparts......................................................46
9.13. Severability......................................................46
9.14. Submission to Jurisdiction; Waivers...............................46
9.15. Definition of Knowledge...........................................46
</TABLE>
ii
<PAGE>
AGREEMENT AND PLAN OF MERGER
----------------------------
THIS AGREEMENT AND PLAN OF MERGER (this "AGREEMENT"), made as of March 31,
2001, by and among Donna Karan International Inc., a Delaware corporation (the
"COMPANY"), LVMH Moet Hennessy Louis Vuitton Inc., a Delaware corporation
("LVMH"), and DKI Acquisition, Inc., a Delaware corporation and a direct
wholly-owned subsidiary of LVMH ("ACQUISITION SUB"),
W I T N E S S E T H: T H A T
----------------------------
WHEREAS, the Boards of Directors of each of LVMH, Acquisition Sub and the
Company have approved, and each deems it advisable and in the best interests of
its stockholders to consummate, the acquisition of the Company by LVMH by means
of the merger (the "MERGER") of Acquisition Sub with and into the Company, upon
the terms and subject to the conditions set forth herein, and
WHEREAS, as a result of the Merger, Acquisition Sub will be merged with
and into the Company, and the Company will be the surviving corporation (the
Company, as such surviving corporation, the "SURVIVING CORPORATION"), and
WHEREAS, as a result of the Merger, the outstanding shares of the
Common Stock of the Company, the Class A Common Stock and the Class B Common
Stock of the Company (each as hereafter defined) (collectively, the "COMPANY
COMMON STOCK") will be converted into the right to receive, and become
exchangeable for, the Merger Consideration (as hereafter defined), and
WHEREAS, as a condition and inducement to the Company's, LVMH's and
Acquisition Sub's entering into this Agreement and incurring the obligations set
forth herein, concurrently with the execution and delivery of this Agreement,
the Company, LVMH, Acquisition Sub, Donna Karan, Stephan Weiss and the Trusts
(as hereafter defined and, collectively with Donna Karan and Stephan Weiss, the
"DK/SW STOCKHOLDERS") are entering into a voting agreement (the "DK AGREEMENT")
pursuant to which the DK/SW Stockholders have agreed to vote their respective
shares of Company Common Stock in favor of the Merger, and
WHEREAS, as a condition and inducement to LVMH and Acquisition Sub's
entering into this Agreement and incurring the obligations set forth herein,
concurrently with the execution and delivery of this Agreement, LVMH,
Acquisition Sub, Takihyo Inc., Tomio Taki, and Frank Mori are entering into a
voting agreement (collectively with the DK Agreement, the "VOTING AGREEMENTS")
pursuant to which, among other things, they have agreed to vote their respective
shares of Company Common Stock in favor of the Merger, and
WHEREAS, as a result of the Merger, the outstanding shares of
Acquisition Sub will be converted into shares of stock of the Surviving
Corporation, and
WHEREAS, after the Merger, the merger of Karma Acquisition, Inc. with
and into the Surviving Corporation and assuming the exercise of all options by
the DK/SW Stockholders,
<PAGE>
LVMH will beneficially own 85.7% of the issued and outstanding common stock of
the Surviving Corporation and 100% of the issued and outstanding shares of the
Series A Preferred Stock of the Surviving Corporation and the DK/SW Stockholders
will, collectively, beneficially own 14.3% of the issued and outstanding common
stock of the Surviving Corporation, and
WHEREAS, LVMH, Acquisition Sub and the Company desire to make certain
representations, warranties, covenants and agreements in connection with the
Merger and also to prescribe various conditions to the consummation thereof,
NOW, THEREFORE, in consideration of the foregoing premises and the
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