J2 Communications Signs Definitive Agreement Under Which Two of Its Shareholders Will Acquire Controlling Interest In J2
Transaction Subject to Financing and Due Diligence Contingencies
LOS ANGELES, March 6 /PRNewswire/ -- J2 Communications (Nasdaq: JTWO - news), owner of the National Lampoon trademark, today announced that it has signed a definitive agreement with two of its shareholders, Daniel S. Laikin and Paul Skjodt, under which Messrs. Laikin and Skjodt and their affiliates will acquire a controlling interest in the Company.
Completion of the transaction, which has been approved by the Company's board of directors, is subject to due diligence and financing contingencies, shareholder approval and customary closing conditions and regulatory approvals. The transaction is expected to close in the second calendar quarter of 2001. Messrs. Jimirro, Laikin and Skjodt, collectively holders of over 39% of the Company's outstanding common stock have agreed to vote in favor of the transaction if it is submitted to the Company's shareholders.
Under the terms of the agreement, Messrs. Laikin and Skjodt and their affiliates will purchase (1) all of the interests of James P. Jimirro, current chairman, president and CEO of the Company; (2) 227,273 common shares directly from the Company; and, (3) at the option of Messrs. Laikin and Skjodt, up to an additional 300,000 common shares directly from the Company. As of the closing, after giving effect to the purchase of all the shares of common stock that Messrs Laikin and Skjodt and their affiliates are obligated to purchase or may elect to purchase, Messrs. Laikin and Skjodt and their affiliates will beneficially own at least 53% of the fully diluted common shares then outstanding. In addition, pursuant to the transactions, Mr. Jimirro will resign his officer and director positions with the Company, receive deferred compensation owned to him and enter into a consulting and non-compete agreement with the Company. The Company's obligations under the consulting agreement will be secured by a lien on certain of its assets.
Messrs. Laikin and Skjodt have agreed to a ``standstill'' agreement effective during the period prior to the closing of the transactions which in general precludes them from purchasing or selling the Company's securities or exerting influence over the Company's governance, by solicitation of proxies or otherwise, and have agreed to the same standstill agreement in the event that the closing does not occur. However, the Company has consented to a waiver of the standstill commitment in order to allow Messrs. Laikin and Skjodt to purchase up to an additional 67,700 common shares.
The agreement also provides for a tender offer by Messrs. Laikin and Skjodt for all the remaining outstanding common shares of the Company, under certain circumstances, not later than the first anniversary of the closing of the transactions.
The agreement resolves the proxy solicitation commenced by Mr. Laikin on or about August 11, 2000.
Mr. Jimirro said ``I have been at J2 for 15 years and this is a terrific opportunity for me to leave the company in good hands while still being involved as a consultant. Once this transaction closes, I intend to take some time off. After that, I plan to become involved in a number of new projects in music and media.''
Mr. Laikin said that following the closing of the transactions, the Company will embark on a number of projects to build upon and leverage the strength of the historic ``National Lampoon'' brand with new business development endeavors in all media.
``We are very excited about the prospects of this company,'' he said, ``and the opportunities the future provides.'' |
