STOCKHOLDER SUPPORT AGREEMENT
STOCKHOLDER SUPPORT AGREEMENT, dated as of December 13, 1998 (this
'Agreement'), by the stockholders listed on the signature page(s) hereto
----------
(collectively, 'Stockholders' and each individually, a 'Stockholder') to and for
------------ -----------
the benefit of MATTEL, INC., a Delaware corporation ('Acquiror'). Capitalized
--------
terms used and not otherwise defined herein shall have the respective meanings
assigned to them in the Merger Agreement referred to below.
WHEREAS, as of the date hereof, the Stockholders collectively own of
record and beneficially shares of capital stock of The Learning Company, Inc., a
Delaware corporation (the 'Company'), as set forth on Schedule I hereto (such
-------
shares or any other voting or equity of securities of the Company, hereafter
acquired by any Stockholder prior to the termination of this Agreement, being
referred to herein collectively as the 'Shares');
------
WHEREAS, concurrently with the execution of this Agreement, Acquiror
and the Company are entering into an Agreement and Plan of Merger, dated as of
the date hereof (the 'Merger Agreement'), pursuant to which, upon the terms and
----------------
subject to the conditions thereof, the Company will be merged with and into
Acquiror, and Acquiror will be the surviving corporation (the 'Merger'); and
------
WHEREAS, as a condition to the willingness of the Company and Acquiror
to enter into the Merger Agreement, Acquiror has requested that the Stockholders
agree, and in order to induce Acquiror to enter into the Merger Agreement, the
Stockholders are willing to agree to vote in favor of adopting the Merger
Agreement and approving the Merger, upon the terms and subject to the conditions
set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements contained herein, and intending to be legally bound
hereby, the parties hereby agree, severally and not jointly, as follows:
Section 1. Voting of Shares. Each Stockholder covenants and agrees
----------------
that until the termination of this Agreement in accordance with the terms
hereof, at the Company Stockholder Meeting or any other meeting of the
stockholders of the Company, however called, and in any action by written
consent of the stockholders of the Company, such Stockholder will vote, or cause
to be voted, all of his, her or its respective Shares in favor of adoption of
the Merger Agreement and approval of the Merger contemplated by the Merger
Agreement, as the Merger Agreement may be modified or amended from time to time
in a manner not adverse to the Stockholders. In addition, such Stockholder
agrees that it will, upon request by Acquiror, furnish written confirmation, in
form and substance reasonably acceptable to Acquiror, of such Stockholder's vote
in favor of the Merger Agreement and the Merger. Each Stockholder covenants and
agrees to deliver to Acquiror upon request immediately prior to any vote
contemplated by the first sentence of this Section 1, a proxy substantially in
the form attached hereto as Annex A (a 'Proxy'), which Proxy shall be
-----
irrevocable during the term of this Agreement to the extent permitted under
Delaware law, and Acquiror agrees to vote the Shares subject to such Proxy in
favor of the approval and adoption of the Merger Agreement and the Merger. Each
Stockholder acknowledges receipt and review of a copy of the Merger Agreement.
Each Stockholder acknowledges and agrees that this proxy, if and when given,
shall be coupled with an interest, shall constitute, among other things, an
inducement for Acquiror to enter into the Merger Agreement, shall be irrevocable
and shall not be terminated by operation of law or otherwise upon the occurrence
of any event and that no subsequent proxies with respect to such Shares shall be
given (and if given shall not be effective); provided, however, that any such
-------- -------
proxy shall terminate automatically and without further action on behalf of the
Stockholders upon the termination of this Agreement.
Section 2. Transfer of Shares. Each Stockholder covenants and agrees
------------------
that such Stockholder will not directly or indirectly, (a) sell, assign,
transfer (including by merger, testamentary disposition, interspousal
disposition pursuant to a domestic relations proceeding or otherwise by
operation of law), pledge, encumber or otherwise dispose of any of the Shares,
(b) deposit any of the Shares into a voting trust or enter into a voting
agreement or arrangement with respect to the Shares or grant any proxy or power
of attorney with respect thereto which is inconsistent with this Agreement or
(c) enter into any contract, option or other arrangement or undertaking with
respect to the direct or indirect sale, assignment, transfer (including by
merger, testamentary disposition, interspousal disposition pursuant to a
domestic relations proceeding or otherwise by operation of law) or other
disposition of any Shares.
Section 3. Treatment of Company Preferred Stock. (a) Subject to the
------------------------------------
terms and conditions of this Agreement, each Stockholder agrees that,
immediately prior to the Effective Time, each share of the Series A Convertible
Participating Preferred Stock, par value $.01 per share, of the Company (the
'Company Preferred Stock'), beneficially owned by such Stockholder shall be
------------------------
converted into shares of Company Common Stock in accordance with the Company's
Certificate of Designation for the Company Preferred Stock, which shares shall
then, in accordance with the terms of the Merger Agreement, be converted in the
Merger into the right to receive shares of Acquiror Common Stock equal to the
product of (i) the Exchange Ratio and (ii) the number of shares of Company
Common Stock issuable upon conversion of such share of Company Preferred Stock
immediately prior to the Effective Time (such conversion by any holder of
Company Common Stock is hereby referred to as the 'Company Preferred Stock
-----------------------
Conversion'). Each Stockholder agrees to deliver the certificates evidencing
----------
its Company Preferred Stock to the Company on or prior to the fifth business day
preceding the Effective Time, along with appropriate instructions and
authorization to cause such shares of the Company Preferred Stock to be
converted to Company Common Stock as contemplated hereby.
(b) In the event that any holder of Company Preferred Stock has
not agreed to make a Company Preferred Stock Conversion, as provided above, or
fails to perform the obligations set forth above, each Stockholder hereby agrees
to vote all of its Shares in favor of an amendment to the Certificate of
Designation or to the Restated Certificate of Incorporation of the Company, as
amended as of the date hereof (the 'Certificate of Incorporation'), in order to
----------------------------
cause the conversion of all outstanding Company Preferred Stock in the Merger as
contemplated by Section 2.7(b) of the Merger Agreement.
2
Section 4. Representations and Warranties of the Stockholders. Each
--------------------------------------------------
Stockholder on its own behalf hereby represents and warrants to Acquiror with
respect to itself and its or her ownership of the Shares as follows:
(a) Ownership of Shares. On the date hereof, the Shares are
-------------------
owned beneficially by Stockholder or its nominee. Stockholder has sole voting
power, without restrictions, with respect to all of the Shares.
(b) Power, Binding Agreement. Stockholder has the legal
------------------------
capacity, power and authority to enter into and perform all of its obligations
under this Agreement. The execution, delivery and performance of this Agreement
by Stockholder will not violate any material agreement to which Stockholder is a
party, including, without limitation, any voting agreement, stockholders'
agreement, partnership agreement or voting trust. This Agreement has been duly
and validly executed and delivered by Stockholder and constitutes a valid and
binding obligation of Stockholder, enforceable against Stockholder in accordance
with its terms, subject to applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws affecting creditors'
rights and remedies generally and subject, as to enforceability, to general
principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).
(c) No Conflicts. The execution and delivery of this
------------
Agreement do not, and the consummation of the transactions contemplated hereby
will not, conflict with or result in any violation of, or default (with or
without notice or lapse of time, or both) under, or give rise to a right of
termination, cancellation or acceleration of any obligation or to loss of a
material benefit under, any provision of any loan or credit agreement, note,
bond, mortgage, indenture, lease, or other agreement, instrument, permit,
concession, franchise, license, judgment, order, decree, statute, law,
ordinance, rule or regulation applicable to Stockholder or any of its properties
or assets, other than such conflicts, violations or defaults or terminations,
cancellations or accelerations which individually or in the aggregate do not
materially impair the ability of Stockholder to perform its obligations
hereunder.
Section 5. No Solicitation. Prior to the termination of this
---------------
Agreement in accordance with its terms, each Stockholder agrees, in its
individual capacity as a stockholder of the Company that (i) it will not, nor
will it authorize or permit any of its employees, agents and representatives to,
directly or indirectly, (a) initiate, solicit or encourage any inquiries or the
making of any Acquisition Proposal (as defined in the Merger Agreement), (b)
enter into any agreement with respect to any Acquisition Proposal, or (c)
participate in any discussions or negotiations regarding, or furnish to any
person any information with respect to, or take any other action to facilitate
any inquiries or the making of any proposal that constitutes, or may reasonably
be expected to lead to, any Acquisition Proposal, and (ii) it will notify
Acquiror as soon as possible if any such inquiries or proposals are received by,
any information or documents is requested from, or any negotiations or
discussions are sought to be initiated or continued with, it or any of its
affiliates in its individual capacity; provided, that, notwithstanding the
foregoing, each Stockholder shall not be prohibited from taking any such actions
to the extent that the
3
Company or its Board of Directors is permitted to take such actions under the
Merger Agreement, including without limitation Section 6.3 thereof.
Section 6. Termination. This Agreement shall terminate upon the
-----------
earliest to occur of (i) the Effective Time (as such term is defined in the
Merger Agreement) or (ii) any termination of the Merger Agreement in accordance
with the terms thereof; provided that the provisions of Section 9 of this
Agreement shall survive any termination of this Agreement; and provided further
that no such termination shall relieve any party of liability for a willful or
intentional breach hereof prior to termination.
Section 7. Specific Performance. The parties hereto agree that
--------------------
irreparable damage would occur in the event any provision of this Agreement was
not performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in addition to any other
remedy at law or in equity.
Section 8. Fiduciary Duties. Each Stockholder is signing this
----------------
Agreement solely in such Stockholder's capacity as an owner of his, her or its
respective Shares, and nothing herein shall prohibit, prevent or preclude such
Stockholder from taking or not taking any action in his or her capacity as an
officer or director of the Company, to the extent permitted by the Merger
Agreement.
Section 9. Miscellaneous.
-------------
(a) This Agreement constitutes the entire agreement between
the parties hereto with respect to the subject matter hereof and supersedes all
prior agreements and understandings, both written and oral, between the parties
with respect thereto. This Agreement may not be amended, modified or rescinded
except by an instrument in writing signed by each of the parties hereto.
(b) If any term or other provision of this Agreement is invalid,
illegal or incapable of being enforced by any rule of law, or public policy, all
other conditions and provisions of this Agreement shall nevertheless remain in
full force and effect. Upon such determination that any term or other provision
is invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible to the fullest extent permitted by
applicable law in a mutually acceptable manner in order that the terms of this
Agreement remain as originally contemplated to the fullest extent possible.
(c) This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without regard to the
principles of conflicts of law thereof.
(d) This Agreement may be executed in counterparts, each of
which shall be deemed an original and all of which together shall constitute one
and the same instrument.
[Signature pages to follow]
4
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be signed individually or by its respective duly authorized officer
as of the date first written above.
MATTEL, INC.
By:______________________________
Name:
Title:
_________________________________
Michael J. Perik
_________________________________
Kevin O'Leary
_________________________________
Lamar Alexander
_________________________________
Michael A. Bell
_________________________________
Robert Gagnon
_________________________________
Carolynn N. Reid-Wallace
_________________________________
Robert A. Rubinoff
_________________________________
Paul J. Zepf
S-1
CENTRE CAPITAL INVESTORS II, L.P.
CENTRE CAPITAL TAX-EXEMPT
INVESTORS II, L.P.
CENTRE CAPITAL OFFSHORE INVESTORS II, L.P.
By: Centre Partners II, L.P., as General Partner
By: Centre Partners Management LLC,
as Attorney-in-Fact
By: ________________________________________
Name:
Title:
CENTRE PARALLEL MANAGEMENT
PARTNERS, L.P.
CENTRE PARTNERS COINVESTMENT, L.P.
By: Centre Partners II LLC, as General Partner
By: ________________________________________
Name:
Title:
S-2
STATE BOARD OF ADMINISTRATION OF
FLORIDA
By: Centre Parallel Management Partners, L.P.,
as Manager
By: Centre Partners Management LLC,
as Attorney-in-Fact
By: ______________________________________
Name:
Title:
S-3
SCHEDULE I
----------
-------------------------------------------------------------------------------------------
Number of shares of
Number of shares of Company Company Series A Convertible
Common Stock, par value Participating Preferred Stock,
Name of Stockholder $.01 per share par value $.01 per share
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Total
-------------------------------------------------------------------------------------------
ANNEX A
FORM OF PROXY
The undersigned, for consideration received, hereby appoints Mattel, Inc., a
Delaware corporation ('Acquiror'), its proxy to vote the shares of capital stock
--------
of The Learning Company, Inc., a Delaware corporation (the 'Company') (the
-------
'Shares'), owned by the undersigned and described on Schedule I to the
-------
Stockholder Support Agreement referred to below and which the undersigned is
entitled to vote at any meeting of stockholders of the Company, and at any
adjournment thereof, to be held for the purpose of considering and voting upon a
proposal to approve and adopt the Agreement and Plan of Merger, dated as of
December 13, 1998 (the 'Merger Agreement'), by and among the Company and
----------------
Acquiror, providing for the merger (the 'Merger') of the Company with and into
------
Acquiror, FOR such proposal. This proxy is subject to the terms of the
Stockholder Support Agreement, is coupled with an interest and revokes all prior
proxies granted by the undersigned with respect to the Shares, is irrevocable
and shall terminate and be of no further force or effect automatically at such
time as the Stockholder Support Agreement, dated as of December 13, 1998,
between the undersigned and Acquiror, a copy of such Agreement being attached
hereto, terminates in accordance with its terms.
________________________
Name:
Stockholder Support Agreement - Mattel Inc.
Was this helpful?