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Exhibit 31
XXXXXX GENERAL CORPORATION AGREES TO BE ACQUIRED
BY GLOBEGROUND GMBH, A UNIT OF DEUTSCHE LUFTHANSA AG, FOR
$76.00 PER SHARE IN CASH
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Great Neck, New York -- February 16, 1999 -- Xxxxxx General Corporation
(AMEX:HGC) announced today that it has entered into a definitive merger
agreement pursuant to which GlobeGround GmbH, a wholly-owned subsidiary of
Deutsche Lufthansa AG, will acquire all of Xxxxxx General's outstanding shares
of Common Stock. The merger agreement provides for a subsidiary of GlobeGround
to commence promptly a tender offer for all of Xxxxxx General's shares at a
price of $76.00 per share in cash. The tender offer will be followed as soon as
possible by a second-step merger in which each share of Xxxxxx General Common
Stock not acquired in the tender offer will be converted into the right to
receive $76.00 per share in cash.
The tender offer is conditioned on the approval of Deutsche Lufthansa's
Supervisory Board not later than March 15, 1999, the valid tender of a majority
of Xxxxxx General's outstanding shares on a fully diluted basis, the expiration
or termination of any applicable waiting periods under the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976 and certain other customary conditions. The
transactions provided for in the merger agreement have been approved by Deutsche
Lufthansa's Executive Board, and Deutsche Lufthansa's Supervisory Board is
currently scheduled to meet on March 10, 1999.
LAGS (USA) Inc., a wholly-owned subsidiary of GlobeGround, holds a
49% interest in Xxxxxx General LLC, Xxxxxx General's 51%-owned affiliate, which
provides services at airports throughout the United States and Canada.
The merger agreement with GlobeGround was approved by Xxxxxx
General's Board of Directors, acting upon the unanimous recommendation of a
Special Committee of the Board comprised of three independent, unaffiliated
directors. In reaching its decision, the Special Committee was advised by its
financial advisor, Xxxxx & Company Incorporated, which rendered a written
opinion that the $76.00 per share price is fair to the holders of Common Stock
of Xxxxxx General from a financial point of view.
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The merger agreement provides, among other things, that GlobeGround
will receive a termination fee of $2.625 million and the reimbursement of
expenses up to $875,000 if the merger agreement is terminated under certain
circumstances prior to approval by Deutsche Lufthansa's Supervisory Board. The
termination fee and maximum expense reimbursement amount will increase to $3.5
million and $1.75 million, respectively, following approval by Deutsche
Lufthansa's Supervisory Board. The merger agreement also provides that in the
event of any superior third party offers for Xxxxxx General, GlobeGround will
have an opportu nity to match or exceed such competing bids before Xxxxxx
General may terminate the merger agreement.
As previously announced, Xxxxxx General recently has received two
other acquisition proposals. On February 12, 1999, Ranger Aerospace Corporation
proposed, subject to certain conditions, to acquire Xxxxxx General at a price of
$72.00 per share in cash, and on February 9, 1999, Xxxxx Corporation proposed,
subject to certain conditions, to acquire Xxxxxx General at a price of $65.00
per share either in cash or in common shares of Xxxxx.
Also, as previously announced, on November 22, 1998, Xxxxxx General
entered into a definitive agreement to be acquired by a management-led buyout
group. That agreement, as amended on February 9, 1999, contemplates a one-step
merger in which all outstanding shares of Xxxxxx General Common Stock would be
acquired for $61.00 per share in cash. Xxxxxx General said today that the
management-led buyout group has waived, until March 17, 1999, its right to termi
nate its merger agreement with Xxxxxx General by reason of Xxxxxx General
entering into the definitive merger agreement with GlobeGround, and such agree
ment remains in effect at the present time.
In addition to its 51% ownership interest in Xxxxxx General LLC,
Xxxxxx General is a participant in a joint venture to develop 4,000 acres of
land in Hawaii. Xxxxxx General shares are traded on the American Stock Exchange
under the ticker symbol HGC.
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