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SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF
THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting material under Rule 14a-12
APPLICA INCORPORATED
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(Name of Registrant as Specified In Its Charter)
N/A
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
PAYMENT OF FILING FEE (Check the appropriate box):
[_] No fee required.
[X] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
COMMON STOCK, PAR VALUE $0.10 PER SHARE, OF APPLICA INCORPORATED
("APPLICA COMMON STOCK")
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(2) Aggregate number of securities to which transaction applies:
15,164,300 SHARES OF APPLICA COMMON STOCK
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935,796 OPTIONS TO PURCHASE SHARES OF APPLICA COMMON STOCK
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11(set forth the amount on which the
filing fee is calculated and state how it was determined):
$6.50 PER SHARE OF APPLICA COMMON STOCK
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$6.50 MINUS WEIGHTED AVERAGE EXERCISE PRICE OF OUTSTANDING OPTIONS
OF $4.25 PER SHARE SUBJECT TO OPTION
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(4) Proposed maximum aggregate value of transaction:
$100,713,616
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(5) Total fee paid:
$10,776.36
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[_] Fee paid previously with preliminary materials.
[X] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
$9,910.49
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(2) Form, schedule or registration statement no.:
SCHEDULE 14A
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(3) Filing party:
APPLICA INCORPORATED
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(4) Date Filed:
NOVEMBER 2, 2006
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[GRAPHIC OMITTED]
APPLICA INCORPORATED
3633 Flamingo Road
Miramar, Florida 33027
SUPPLEMENT TO PROXY STATEMENT
Dear Fellow Shareholder: December 15, 2006
On or about December 6, 2006, we mailed to you a definitive proxy
statement relating to a special meeting of our shareholders to be held on
December 28, 2006 for the purpose of considering and voting on a proposal to
adopt the Agreement and Plan of Merger, dated as of October 19, 2006, among
Applica and APN Holding Company, Inc. and APN Mergersub, Inc. (which are
subsidiaries of Harbinger Capital Partners Master Fund I, Ltd. and Harbinger
Capital Partners Special Situations Fund, L.P., and which we refer to, along
with such funds, as Harbinger), pursuant to which, among other things, upon
the merger becoming effective, each outstanding share of Applica common stock,
par value $0.10 per share (other than shares owned by Applica or Harbinger),
would be converted into the right to receive $6.00 in cash, without interest,
and Applica would become an indirect wholly owned subsidiary of the Harbinger
funds.
On December 14, 2006, the parties to the merger agreement amended the
original merger agreement to provide for an increase of $0.50 in cash per
share over the $6.00 in cash per share provided for in the original merger
agreement, such that upon completion of the merger, each outstanding share of
our common stock (other than shares owned by Applica or Harbinger) will be
converted into the right to receive $6.50 in cash, without interest. No other
amendments were made to the original merger agreement previously submitted to
our shareholders. The original merger agreement as so amended is referred to
as the amended merger agreement. The amendment to the merger agreement is
attached to the attached supplement as Annex A.
The attached supplement contains additional information about the
amended merger agreement. We urge you to read this document carefully and in
its entirety. We also encourage you, if you have not done so already, to
review the definitive proxy statement. You should consider the matters
discussed under "Special Note Regarding Forward-Looking Statements" on page 2
of the attached supplement before voting. You may also obtain additional
information from documents we have filed with the Securities and Exchange
Commission.
The time, date and place of the special meeting to consider and vote
upon the adoption of the amended merger agreement remain the same and are as
follows:
11:00 a.m., Eastern Standard Time, on December 28, 2006
3633 Flamingo Road, Miramar, Florida 33027
The record date for the special meeting has not changed. Only holders
of our common stock at the close of business on November 27, 2006 are entitled
to notice of the special meeting and to vote at the special meeting, except
that shares of our common stock that are beneficially owned by Harbinger are
not eligible or entitled to vote at the special meeting. All shareholders of
record are cordially invited to attend the special meeting in person.
YOUR VOTE IS VERY IMPORTANT, REGARDLESS OF THE NUMBER OF SHARES OF OUR
COMMON STOCK YOU OWN. The merger cannot be completed unless holders of a
majority of the outstanding shares of our common stock entitled to vote at the
special meeting vote for the adoption of the amended merger agreement. If you
do not vote, it will have the same effect as a vote against the merger.
Whether or not you plan to attend the special meeting in person,
please complete, sign, date and return promptly the proxy card enclosed with
the definitive proxy statement. If you have already submitted a proxy, you do
not need to submit another proxy unless you wish to change your vote. If you
hold shares through a broker or other nominee, you should follow the
procedures provided by your broker or nominee. These actions will not limit
your right to vote in person if you wish to attend the special meeting and
vote in person.
After careful consideration, our board of directors approved the
amended merger agreement and the merger and unanimously declared that the
amended merger agreement and the transactions contemplated by the amended
merger agreement, including the merger, were advisable for, fair to and in the
best interest of Applica shareholders. THE BOARD OF DIRECTORS UNANIMOUSLY
RECOMMENDS THAT YOU VOTE "FOR" THE ADOPTION OF THE MERGER AGREEMENT, AS
AMENDED.
Thank you in advance for your cooperation and continued support.
By Order of the Board of Directors,
/s/ Harry D. Schulman
---------------------------------
Harry D. Schulman Chairman of the Board,
President and Chief Executive Officer
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
REGULATORY AGENCY HAS APPROVED OR DISAPPROVED THE MERGER, PASSED UPON THE
MERITS OR FAIRNESS OF THE MERGER OR PASSED UPON THE ADEQUACY OR ACCURACY OF
THE DISCLOSURE IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
This supplement is dated December 15, 2006 and is first being mailed to
shareholders on or about December 16, 2006.
TABLE OF CONTENTS
PAGE
----
INTRODUCTION..................................................................1
UPDATE TO SUMMARY.............................................................1
PURPOSE OF THE MEETING.....................................................1
REQUIRED VOTE..............................................................1
RECOMMENDATION OF OUR BOARD OF DIRECTORS...................................1
MARKET PRICE OF OUR COMMON STOCK...........................................2
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS.............................2
THE MERGER....................................................................3
UPDATE TO BACKGROUND OF THE MERGER.........................................3
RECOMMENDATION OF OUR BOARD OF DIRECTORS...................................3
SUMMARY OF THE AMENDMENTS TO THE MERGER AGREEMENT.............................4
UPDATE TO QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER......5
WHERE YOU CAN FIND MORE INFORMATION...........................................7
ANNEX:
Annex A - Amendment to Agreement and Plan of Merger
INTRODUCTION
The information provided in the definitive proxy statement dated
December 4, 2006, which we refer to in this supplement as the definitive proxy
statement, previously mailed to our shareholders on or about December 6, 2006,
continues to apply, except as described in this supplement. To the extent
information in this supplement differs from, updates or conflicts with
information contained in the definitive proxy statement, the information in
this supplement is the more current information. If you would like additional
copies of the definitive proxy statement, this supplement or a new proxy card
or if you have questions about the merger, you should contact our proxy
solicitor, Georgeson Inc. at 17 State Street, New York, New York 10004 or call
them toll-free at (866) 857-2634. Banks and brokerage firms, please call (212)
440-9800. You may also contact our Investor Relations Department at (954)
883-1000. The definitive proxy statement may also be found on the Internet at
www.sec.gov. See "Where You Can Find More Information" on page 7 of this
supplement. In this supplement, the terms "we," "our," "ours," and "us" refer
to Applica Incorporated and its subsidiaries.
UPDATE TO SUMMARY
This update to the summary, together with the following updated
question and answer section, highlights important information discussed in
more detail elsewhere in this supplement and in the definitive proxy
statement. This updated summary does not contain all of the information you
should consider before voting on the amended merger agreement and the merger.
To understand the merger more fully, you are urged to read carefully this
entire supplement and the amendment to the merger agreement, a copy of which
is attached as Annex A to this supplement, the definitive proxy statement and
all of its annexes before voting on whether to approve the amended merger
agreement and the merger. The amended merger agreement is the legal document
that governs the merger.
PURPOSE OF THE MEETING
You will be asked to consider and vote on a proposal to adopt the
Agreement and Plan of Merger, dated as of October 19, 2006, among Applica and
Buyer and Merger Co (which are subsidiaries of the Harbinger Funds), as
amended by Amendment No. 1 to the Agreement and Plan of Merger, dated as of
December 14, 2006, among Applica and Buyer and Merger Co, pursuant to which,
upon the merger becoming effective, each outstanding share of Applica common
stock, par value $0.10 per share, (other than shares owned by Applica or
Harbinger) will be converted into the right to receive $6.50 in cash, without
interest.
REQUIRED VOTE
Under Florida law, the affirmative vote of holders of a majority of
the outstanding shares of our common stock entitled to vote at the special
meeting is necessary to adopt the amended merger agreement. Thus, the
affirmative vote of holders of common stock representing at least 7,585,151
votes will be required to approve the merger. A failure to vote your shares of
our common stock or an abstention will have the same effect as voting against
the merger.
Shares of our common stock that are beneficially owned by Harbinger
are not eligible or entitled to vote on the merger at the special meeting.
RECOMMENDATION OF OUR BOARD OF DIRECTORS
After careful consideration, our board of directors approved the
amended merger agreement and the merger and unanimously declared that the
amended merger agreement and the transactions contemplated by the amended
merger agreement, including the merger, were advisable for, fair to and in the
best interest of Applica shareholders. ACCORDINGLY, OUR BOARD OF DIRECTORS
RECOMMENDS THAT YOU VOTE "FOR" THE ADOPTION OF THE MERGER AGREEMENT, AS
AMENDED.
1
MARKET PRICE OF OUR COMMON STOCK
Our common stock is listed on the NYSE under the trading symbol "APN".
The closing price of our common stock on the NYSE as of December 14, 2006, the
last trading day prior to the public announcement of our execution of the
amended merger agreement was $5.76.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This supplement, and the documents to which we refer you in this
supplement, contain forward-looking statements about our plans, objectives,
expectations and intentions. Forward-looking statements include information
concerning possible or assumed future results of operations of our company,
the expected completion and timing of the merger and other information
relating to the merger. Generally these forward-looking statements can be
identified by the use of forward-looking terminology such as "anticipate,"
"believe," "estimate," "expect," "may," "should," "plan," "intend," "project"
and similar expressions. For each of these statements, we claim the protection
of the safe harbor for forward-looking statements contained in the Private
Securities Litigation Reform Act of 1995. You should read statements that
contain these words carefully. They discuss our future expectations or state
other forward-looking information, and may involve known and unknown risks
over which we have no control. Those risks include, without limitation:
o the ability to obtain governmental approvals of the merger on
the proposed terms and schedule;
o failure to obtain the approval of the merger proposal at the
special meeting of shareholders;
o the occurrence of any event, change or other circumstances
that could give rise to the termination of the amended merger
agreement, including a termination under circumstances that
could require us to pay a termination fee to Buyer in the
amount of $4.0 million plus up to $2.0 million of reasonable
documented, third party, out of pocket expenses;
o the amount of the costs, fees, expenses and charges related to
the merger;
o the failure of the merger to close for any reason;
o disruption from the announcement of the merger, and the
merger, making it more difficult to maintain relationships
with customers, employees or suppliers;
o the risk that the merger may not be completed in a timely
manner or at all, which may adversely affect our business and
the price of our common stock;
o the potential adverse effect on our business, properties and
operations because of certain covenants we agreed to in the
amended merger agreement;
o the uncertainty as to the outcome of the pending litigation
filed by NACCO Industries, Inc. and HB-PS Holding Company,
Inc. related to the termination of their merger agreement with
us and the impact of such litigation on the merger; and
o other risks detailed in our filings with the Securities and
Exchange Commission (the "SEC"), including "Item 1A. Risk
Factors" in our Annual Report on Form 10-K for our fiscal year
ended December 31, 2005. See "Where You Can Find More
Information" on page 7.
2
THE MERGER
UPDATE TO BACKGROUND OF THE MERGER
THE DISCUSSION BELOW SUPPLEMENTS THE DESCRIPTION IN THE DEFINITIVE
PROXY STATEMENT OF THE BACKGROUND OF THE MERGER.
Late in the evening of December 13, 2006, we received a letter from
NACCO Industries, Inc. offering to acquire our common stock for $6.50 per
share in cash (and on December 15, 2006, NACCO publicly announced that,
through a subsidiary, it had commenced a tender offer to purchase all of our
outstanding common stock at an offer price of $6.50 per share). In accordance
with the terms of the merger agreement, we promptly notified Harbinger on
December 14, 2006 of our receipt of the offer from NACCO.
Subsequently, Harbinger submitted to us a definitive binding offer to
enter into an amendment to its merger agreement that provides for our
shareholders to receive $6.50 in cash per share if the Harbinger merger is
completed. Our board held a meeting that same day and discussed the offers
from NACCO and Harbinger and its obligations under the Harbinger merger
agreement. The meeting was attended by our senior management and legal and
financial advisors, as well as a representative of the board's independent
legal counsel. At the meeting, the board reviewed and discussed the offers
from NACCO and Harbinger with management and the legal and financial advisors.
The board also discussed with the legal advisors the provisions of the
Harbinger merger agreement relating to competing transactions.
After consultation with the legal and financial advisors, our board
unanimously determined that the merger agreement, as amended, is at least as
favorable to our shareholders as the offer made by NACCO, is advisable for,
fair to and in the best interests of our shareholders (other than Harbinger
and its affiliates) and voted to approve and adopt, and authorized senior
management to enter into, the amendment proposed by Harbinger. On December 14,
2006, we executed Amendment No. 1 to the Agreement and Plan of Merger with
Harbinger and thereafter issued a press release announcing the amendment.
RECOMMENDATION OF OUR BOARD OF DIRECTORS
After careful consideration, the board of directors unanimously
approved the amended merger agreement and the merger. THE BOARD OF DIRECTORS
RECOMMENDS THAT OUR SHAREHOLDERS VOTE "FOR" THE ADOPTION OF THE MERGER
AGREEMENT, AS AMENDED.
3
SUMMARY OF THE AMENDMENTS TO THE MERGER AGREEMENT
THE FOLLOWING DISCUSSION SUMMARIZES THE MATERIAL PROVISIONS OF THE
AMENDMENT TO THE MERGER AGREEMENT AND IS QUALIFIED BY REFERENCE TO THE
AMENDMENT, A COPY OF WHICH IS ATTACHED AS ANNEX A TO THIS SUPPLEMENT AND IS
INCORPORATED BY REFERENCE INTO THIS SUPPLEMENT. THE RIGHTS AND OBLIGATIONS OF
THE PARTIES ARE GOVERNED BY THE EXPRESS TERMS AND CONDITIONS OF THE MERGER
AGREEMENT (WHICH IS INCLUDED AS ANNEX A TO THE DEFINITIVE PROXY STATEMENT), AS
WELL AS THE AMENDMENT, AND NOT BY THIS SUMMARY OR ANY OTHER INFORMATION
CONTAINED IN THIS SUPPLEMENT. WE URGE YOU TO READ THE MERGER AGREEMENT AND THE
AMENDMENT CAREFULLY AND IN THEIR ENTIRETY, AS WELL AS THE DEFINITIVE PROXY
STATEMENT AND THIS SUPPLEMENT, BEFORE MAKING ANY DECISIONS REGARDING THE
MERGER.
On December 14, 2006, Applica and Buyer and Merger Co (which are
subsidiaries of the Harbinger Funds) entered into an amendment to the
Agreement and Plan of Merger, dated as of October 19, 2006. A complete copy of
the amendment is included as Annex A to this supplement and is incorporated by
reference into this discussion. The following discussion summarizes the
material changes to the merger agreement made by the amendment.
INCREASE IN MERGER CONSIDERATION
The amendment to the merger agreement provides for a $0.50 per share
increase in the cash consideration to be received by our shareholders in the
merger, from $6.00 to $6.50 in cash, without interest, for each share of our
common stock outstanding (other than shares owned by Applica or Harbinger).
4
UPDATE TO QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER
The following questions and answers are intended to address some
commonly asked questions regarding the amendment to the merger agreement, the
merger and the special meeting. These questions and answers may not address
all questions that may be important to you as our shareholder. Please refer to
the more detailed information contained elsewhere in this supplement and in
the definitive proxy statement.
Q: WHY ARE YOU SENDING ME THIS SUPPLEMENT TO THE DEFINITIVE PROXY
STATEMENT?
A: We are sending you this supplement to the definitive proxy statement
because on December 14, 2006, we entered into an amendment to the
merger agreement. This supplement provides information with respect to
the amendment to the merger agreement and certain other matters and
updates the definitive proxy statement which was previously mailed to
you.
Q: WHAT WILL I NOW RECEIVE IN THE MERGER?
A: Pursuant to the amendment to the merger agreement, upon completion of
the merger, you will receive $6.50 in cash, without interest, for each
share of our common stock that you own.
Q: DOES THE BOARD OF DIRECTORS SUPPORT THE AMENDED MERGER AGREEMENT?
A: Yes. Our board unanimously recommends that our shareholders vote "FOR"
the adoption of the merger agreement, as amended.
Q: WHEN AND WHERE IS THE SPECIAL MEETING?
A: The special meeting of shareholders will be held at our executive
offices located at 3633 Flamingo Road, Miramar, Florida 33027, on
December 28, 2006, at 11:00 a.m., Eastern Standard Time.
Q: WHO CAN VOTE AT THE SPECIAL MEETING?
A: The record date for the special meeting has not changed. All
shareholders of record at the close of business on November 27, 2006,
the record date for the special meeting, will be entitled to vote at
the special meeting, except that shares of our common stock that are
beneficially owned by Harbinger are not eligible or entitled to vote
at the special meeting.
Q: WHAT IF I ALREADY VOTED USING THE PROXY YOU SENT ME EARLIER?
A: First, carefully read and consider the information contained in this
supplement. If you have already delivered a properly executed proxy,
you will be considered to have voted on the amended merger agreement,
and you do not need to do anything unless you wish to change your
vote.
Q CAN I CHANGE MY VOTE AFTER I HAVE MAILED IN MY PROXY CARD?
A: Yes. You can change your vote at any time before we vote your proxy at
the special meeting. You can do so by:
o delivering a written notice to the corporate secretary of
Applica before the special meeting that states that you revoke
your proxy;
o delivering a signed and dated new proxy card before the
special meeting in accordance with the instructions included
with the proxy card; or
o attending the special meeting and voting in person.
5
Simply attending the special meeting will not revoke your proxy. If
your shares are held in "street name" by your broker, bank, dealer or
other nominee, you must follow instructions received from such broker,
bank or nominee with this supplement or the definitive proxy statement
in order to revoke your vote or to vote at the special meeting.
Q: WHAT DO I DO IF I HAVE NOT VOTED YET?
A: After carefully reading and considering the information contained in
this supplement and the definitive proxy statement, please complete,
sign and date your proxy and return it in the postage-paid return
envelope enclosed with the definitive proxy statement as soon as
possible, so that your shares may be represented at the special
meeting. If you sign and send in your proxy and do not indicate how
you want to vote, we will vote your proxy in favor of approval of the
amended merger agreement. Because the required vote of our
shareholders is based upon the number of outstanding shares of our
common stock entitled to vote at the special meeting, rather than upon
the shares actually voted, the failure by the holder of any such
shares to submit a proxy or to vote in person at the special meeting,
including abstentions and broker non-votes, will have the same effect
as a vote against approval of the amended merger agreement.
Q: WHAT IS THE STATUS OF NACCO'S OFFER?
A: Please read the section entitled "Background of the Merger" on pages
19-28 of the definitive proxy statement for a summary of our prior
dealings with the NACCO Industries, Inc. On December 13, 2006, we
received a letter from NACCO offering to acquire our common stock for
$6.50 per share in cash. On December 14, 2006, our board unanimously
determined that the merger agreement, as amended, is at least as
favorable to our shareholders as the offer made by NACCO, is advisable
for, fair to and in the best interests of our shareholders (other than
Harbinger and its affiliates) and voted to approve and adopt, and
authorized senior management to enter into, the amendment proposed by
Harbinger. On December 15, 2006, NACCO publicly announced that,
through a subsidiary, it had commenced a tender offer to purchase all
of our outstanding common stock at an offer price of $6.50 per share.
Q: WHO CAN ANSWER FURTHER QUESTIONS?
A: If you would like additional copies of this supplement or the
definitive proxy statement or a new proxy card or if you have
questions about the merger, you should contact our proxy solicitor,
Georgeson Inc. at 17 State Street, New York, New York 10004 or call
them toll-free at (866) 857-2634. Banks and brokerage firms, please
call (212) 440-9800. You may also contact our Investor Relations
Department at (954) 883-1000.
6
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and
other information with the SEC. You may read and copy any reports, proxy
statements or other information that we file with the SEC at its Public
Reference Room, 100 F Street, N.E., Washington, D.C. 20549. Please call the
SEC at 1-800-SEC-0330 for further information on the public reference rooms.
You may also obtain copies of this information by mail from the Public
Reference Section of the SEC, 100 F Street, N.E., Washington, D.C. 20549, at
prescribed rates. Our public filings are also available to the public from
document retrieval services and the Internet website maintained by the SEC at
WWW.SEC.GOV.
Reports, proxy statements or other information concerning us may also
be inspected at the offices of the NYSE at 20 Broad Street, New York, NY
10005.
Any person, including any beneficial owner, to whom this supplement is
delivered may request copies of proxy statements and any documents filed with
the SEC or other information concerning us, without charge, by written or
telephonic request directed to us at:
Applica Incorporated
3633 Flamingo Road
Miramar, Florida 33027
Attention: Investor Relations
Telephone: (954) 883-1000
investor.relations@applicamail.com
If you would like to request documents from us, please do so by December 20,
2006 to receive them before the special meeting.
You should rely only on the information contained in this supplement,
the definitive proxy statement and the annexes to this supplement and the
definitive proxy statement, as well as the documents which we refer to in the
definitive proxy statement to vote on the merger agreement, as amended. We
have not authorized anyone to provide you with information that is different
from what is contained in this supplement or the definitive proxy statement.
This supplement does not constitute a solicitation of a proxy in any
jurisdiction where, or to or from any person to whom, it is unlawful to make a
proxy solicitation.
* * * * *
YOUR VOTE IS IMPORTANT. To vote your shares, please complete, date,
sign and return the proxy card enclosed with the definitive proxy statement as
soon as possible. Please contact our proxy solicitor, Georgeson Inc. at 17
State Street, New York, New York 10004 or call them toll-free at (866)
857-2634 if you have any questions about this supplement, the definitive proxy
statement or the merger or need assistance with the voting procedures.
7
ANNEX A
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AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER
AMENDMENT NO. 1, dated as of December 14, 2006 (this "FIRST
AMENDMENT"), to the Agreement and Plan of Merger, dated as of October 19, 2006
(the "MERGER AGREEMENT"), by and among APN Holding Company, Inc., a Delaware
corporation ("PARENT"), APN Mergersub, Inc., a Florida corporation and a
wholly owned direct subsidiary of Parent ("MERGERSUB"), and Applica
Incorporated, a Florida corporation (the "COMPANY"). Capitalized terms used
herein and not defined herein have the meanings ascribed thereto in the Merger
Agreement.
WHEREAS, pursuant to, and subject to the limitations set forth in,
Section 9.2 of the Merger Agreement, the Merger Agreement may be amended,
modified, or supplemented only by the written agreement of the parties
thereto; and
WHEREAS, the parties hereto wish to amend the Merger Agreement as set
forth below.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein, the receipt and adequacy of which are hereby
acknowledged, the parties hereby agree as follows:
1. AMENDMENT. Section 3.1(a) of the Merger Agreement is hereby
amended by deleting the word "$6.00" in both instances and replacing each with
the word "$6.50."
2. MISCELLANEOUS.
(a) GOVERNING LAW. This First Amendment shall be governed
by and construed in accordance with the internal Laws of the State of Delaware
applicable to Contracts made and wholly performed in such state, without
regard to any applicable conflict of laws principles; provided, however, that
the Merger will also be governed by the applicable provisions of the FCBA to
the extent required thereby.
(b) COUNTERPARTS. This First Amendment may be executed in
two or more counterparts, all of which will be considered one and the same
instrument and will become effective when counterparts have been signed by
each of the parties and delivered to the other parties, it being understood
that each party need not sign the same counterpart.
(c) CONTINUED FORCE AND EFFECT. Except as expressly
amended or modified herein, the provisions of the Merger Agreement are and
shall remain in full force and effect.
(d) AUTHORIZATION AND VALIDITY OF AGREEMENT. The execution
and delivery of this First Amendment by each of the parties hereto have been
duly authorized and approved by their respective boards of directors and no
other corporate action on the part of the parties hereto is necessary to
authorize the execution and delivery of this First Amendment. This First
Amendment has been, or will be when executed and delivered, duly executed and
delivered by each of the parties hereto, and a valid and binding obligation of
each of the parties hereto enforceable against each of the parties hereto in
accordance with its terms, except to the extent that its enforceability may be
subject to applicable bankruptcy, insolvency, reorganization, moratorium and
similar Laws affecting the enforcement of creditors' rights generally and by
general equitable principles.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the undersigned has executed, or has caused to be
executed, this First Amendment on the date first written above.
APN HOLDING COMPANY, INC.
By: /s/ Philip Falcone
----------------------------
Name: Philip Falcone
Title: Vice President and Senior
Managing Director
APN MERGERSUB, INC.
By: /s/ Philip Falcone
----------------------------
Name: Philip Falcone
Title: Vice President and Senior
Managing Director
APPLICA INCORPORATED
By: /s/ Harry D. Schulman
----------------------------
Name: Harry D. Schulman
Title: Chairman and Chief
Executive Officer