EXHIBIT 2.3
AGREEMENT AND PLAN OF MERGER, dated as of July 29, 1997 (this
"AGREEMENT") by and between Discovery Zone, Inc. a Delaware corporation (the
"PARENT COMPANY"), and Discovery Zone Children's Amusement Corporation a
Delaware corporation and a wholly owned subsidiary of the Parent Company (the
"Operating Company" and together with the Parent Company, the "COMPANIES").
WHEREAS, on March 25, 1996, each of the Companies filed a petition for
relief under Chapter 11 of Title 11, United States Code, 11 U.S.C. Section 101,
ET SEQ. (the "BANKRUPTCY CODE") in the United States Bankruptcy Court for the
District of Delaware (the "BANKRUPTCY COURT").
WHEREAS, on July 18, 1997 the Bankruptcy Court entered the Order
Confirming Third Amended Joint Plan of Reorganization (the "Confirmation
Order"), a copy of which is attached hereto as Exhibit A.
WHEREAS, the Confirmation Order, INTER ALIA, confirmed the Third
Amended Plan of Reorganization Pursuant to 11 U.S.C. Section 1129 (the "PLAN")
and authorized the Parent Company merge with and into the Operating Company (the
"MERGER"), on the terms and subject to the conditions contained herein and in
accordance with the General Corporation Law of Delaware ("DGCL"), including but
not limited to Section 303 of the DGCL.
NOW, THEREFORE, in consideration of the mutual agreements contained
herein, and in order to set forth the terms and conditions of the Merger and the
mode of carrying the same into effect, the Companies hereby agree as follows:
ARTICLE I
THE MERGER
SECTION 1.1. THE MERGER. At the Effective Time (as defined in
Section 1.2), the Parent Company shall merge into the Operating Company, the
separate corporate existence of the Parent Company shall cease, and the
Operating Company shall continue as the surviving corporation (hereinafter
sometimes referred to as the "SURVIVING CORPORATION") which from the Effective
Time shall operate as the new parent/holding company.
SECTION 1.2. EFFECTIVE TIME OF THE MERGER. The Merger shall become
effective immediately upon the simultaneous filing of a Certificate of Merger or
Articles of Merger relating to the Merger or this Agreement, as appropriate,
with the Secretary of State
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of Delaware, in each case in such form as is required by, and executed in
accordance with, the relevant provisions of the DGCL (the time of such
simultaneous filing being the "EFFECTIVE TIME").
SECTION 1.3. EFFECT OF THE MERGER. At the Effective Time, the effect
of the Merger shall be as provided in the relevant provisions of the DGCL. The
title to any real estate vested by deed or otherwise in the Companies shall not
revert or be in any way impaired by reason of the Merger, but shall be vested in
the Surviving Corporation. The Surviving Corporation shall continue to be
governed by the laws of Delaware. Without limiting the generality of the
foregoing, and subject thereto, at the Effective Time all property (real,
personal and mixed), claims, rights, intellectual property rights, privileges,
powers, franchises and every other interest of the Companies shall vest in the
Surviving Corporation, and all debts, obligations, restrictions, disabilities
and duties of the Companies shall become debts, obligations, restrictions,
disabilities and duties of the Surviving Corporation.
SECTION 1.4. CERTIFICATE OF INCORPORATION AND BY-LAWS. The Amended
and Restated Certificate of Incorporation of the Parent Company, as in effect on
the Effective Time, shall be the Certificate of Incorporation of the Surviving
Corporation until thereafter amended as provided by law or such Amended and
Restated Certificate of Incorporation. The name of the Surviving Corporation
shall be Discovery Zone, Inc. as set forth in such Certificate of Incorporation.
The Amended and Restated By-laws of the Parent Company, as in effect on the
Effective Time, shall be the By-laws of the Surviving Corporation until
thereafter amended as provided by law, the Amended and Restated Certificate of
Incorporation of the Surviving Corporation or such Amended and Restated By-laws.
SECTION 1.5. DIRECTORS AND OFFICERS. The directors of the Parent
Company on the Effective Date, shall be the initial directors of the Surviving
Corporation, each to hold office in accordance with the Amended and Restated
Certificate of Incorporation and Amended and Restated By-laws of the Surviving
Corporation, and the officers of the Parent Company on the Effective Date shall
be the initial officers of the Surviving Corporation, in each case until their
respective successors are duly elected or appointed and qualified.
SECTION 1.6. CONVERSION OF SECURITIES. (a) each issued and
outstanding share of Common Stock, $0.01 par value of the Parent Company, shall
automatically, without further action by the Surviving Corporation, be converted
into one validly issued, fully paid and nonassessable share of Common Stock, par
value $0.001, of the Surviving Corporation; (b) each issued and outstanding
Warrant to purchase shares of Common Stock, with an expiration date of May 1,
2007 of the Parent Company, shall automatically, without further action by the
Surviving Corporation, be converted into one Warrant of the Surviving
Corporation with the same rights, designations and preferences; (c) each issued
and outstanding share of Series A Convertible Preferred Stock, par value $0.01
per share of the
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Parent Company shall automatically, without further action by the Surviving
Corporation, be converted into one share of same Series A Convertible
Preferred Stock of the Surviving Corporation; (d) each issued and
outstanding Unit consisting of 13 1/2% Senior Secured Notes due 2002 with
Warrants to purchase shares of Common Stock of the Parent Company shall
automatically, without further action by the Surviving Corporation, be
converted into one Unit with the same rights, designations and preferences of
the Surviving Corporation; (e) each issued and outstanding 13 1/2% Senior
Secured Note due 2002 of the Parent Company shall automatically, without
further action by the Surviving Corporation, be converted into one Note with
the same rights, designations and preferences of the Surviving Corporation;
(f) each issued and outstanding Warrant to purchase shares of Common Stock,
with an expiration date of August 1, 2007 of the Parent Company shall
automatically,without further action by the Surviving Corporation, be
converted into one Warrant of the Surviving Corporation; (g) each issued and
outstanding debt security representing tax obligations of the Parent Company
shall automatically, without further action by the Surviving Corporation, be
converted into one debt security of the Surviving Corporation with the same
rights, designations and preferences; (h) each issued and outstanding Note
held the XxXxxxxx'x Corporation representing certain secured claims against
the Parent Company shall automatically, without further action by the
Surviving Corporation, be converted into one Note with the same rights,
designations and preferences of the Surviving Corporation; (i) each issued
and outstanding Note held by the XxXxxxxx'x Corporation representing
restructuring of rent deferrals which McDonald's granted to the Parent
Company shall automatically, without further action by the Surviving
Corporation, be converted into one Note with the same rights, designations
and preferences of the Surviving Corporation.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE PARENT COMPANY
The Parent Company represents and warrants that (A) it is a
corporation duly incorporated, validly existing and in good standing under the
laws of the jurisdiction of its incorporation, with all necessary corporate
power and authority to enter into and perform its obligations under this
Agreement and (B) this Agreement has been duly and validly authorized, executed
and delivered by the Parent Company and is binding on and enforceable against
the Parent Company in accordance with its terms.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE OPERATING COMPANY
The Operating Company represents and warrants that (A) it is a
corporation duly incorporated, validly existing and in good standing under the
laws of Delaware, with all necessary corporate power and authority to enter into
and perform its obligations under this Agreement and (B) this Agreement has been
duly and validly authorized, executed and delivered by the Operating Company and
is binding on and enforceable against the Operating Company in accordance with
its terms.
ARTICLE IV
SURVIVAL OF REPRESENTATIONS AND WARRANTIES
The parties hereto each agree that all representations and warranties
contained herein shall not survive the Effective Time indefinitely.
ARTICLE V
GENERAL PROVISIONS
SECTION 5.1. GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of Delaware applicable to contracts
executed in and performed in that State, without regard to principles of
conflicts of law thereof.
SECTION 5.2. COUNTERPARTS. This Agreement may be executed in one or
more counterparts (including by facsimile transmission), and by different
parties hereto in separate counterparts, each of which when executed shall be
deemed to be an original but all of which taken together shall constitute one
and the same agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the date first above written by their respective officers.
DISCOVERY ZONE, INC.
By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: Senior Vice President/Chief
Financial and Administrative
Officer
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the date first above written by their respective officers.
DISCOVERY ZONE CHILDREN'S
AMUSEMENT CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: Vice President,
Secretary &
Treasurer
