AMENDMENT NO. 1 TO
AGREEMENT AND PLAN OF MERGER
THIS AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER (this "Amendment")
is dated as of April 29, 1998, by and among HIGHWOODS PROPERTIES, INC., a
Maryland corporation ("Highwoods"), JACKSON ACQUISITION CORP., a Maryland
corporation ("Sub"), and J.C. NICHOLS COMPANY, a Missouri corporation ("JCN").
Capitalized terms used but not defined herein shall have the meanings set forth
in the Agreement and Plan of Merger dated as of December 22, 1997 and entered
into among Highwoods, Sub, and JCN (the "Agreement").
WHEREAS, the Parties wish to amend the Agreement, which contemplates
the merger of JCN with and into Sub (the "Merger"), in order to provide to JCN
shareholders greater certainty in determining the amount and form of
consideration to be received in the Merger; and
WHEREAS, Highwoods wishes to waive a condition to its obligation to
consummate the Merger.
NOW, THEREFORE, in consideration of the foregoing premises, covenants,
and agreements contained herein, and other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties to this Amendment,
intending to be legally bound, hereby agree as follows:
SECTION I
AMENDMENT TO ARTICLE 3
Section 1.1 Conversion of Shares. Section 3.1 (c) is hereby amended in
its entirety to read as follows:
(c) Subject to the right granted in Section 3.2, each share of
JCN Common Stock (including any associated JCN Rights, but
excluding shares held by any JCN Entity or any Highwoods
Entity and excluding shares held by shareholders who perfect
their statutory dissenters' rights as provided in Section 3.5)
issued and outstanding immediately prior to the Effective Time
shall cease to be outstanding and shall be converted into a
fixed number of shares of Highwoods Common Stock. The number
of shares of Highwoods Common Stock to be issued for each
share of JCN Common Stock (the "Per Share Stock
Consideration") shall be determined by reference to a ratio
(the "Exchange Ratio") that shall be equal to the greater of:
(i) 1.84, or (ii) the quotient of $65 divided by the average
of the daily average high and low sale price for shares of
Highwoods Common Stock on the NYSE for each of the twenty (20)
trading days immediately preceding the Effective Time;
provided, however, that at no time shall the Exchange Ratio
exceed 2.03. Pursuant to the Highwoods Rights Agreement, each
share of Highwoods Common Stock issued in connection with the
Merger upon conversion of JCN Common Stock shall be
accompanied by a Highwoods Right.
Section 1.2 Cash Election. Section 3.2 is hereby amended in its
entirety to read as follows:
3.2 Cash Election. Holders of JCN Common Stock shall
be provided with an opportunity to elect to receive cash
consideration in lieu of receiving Highwoods Common Stock in
the Merger, in accordance with the election procedures set
forth below in this Section 3.2. Holders who are to receive
cash in lieu of exchanging their shares of JCN Common Stock
for Highwoods Common Stock as specified below shall receive
$65 per share of JCN Common Stock in cash (the "Per Share Cash
Consideration"). The amount determined by multiplying $65 by
the number of Dissenting Shares shall be defined herein as the
"Dissenting Share Amount." The aggregate Per Share Cash
Consideration to be paid in the Merger, plus the Dissenting
Share Amount, shall be limited to 40% of the aggregate
consideration paid in exchange for shares of JCN Common Stock
and shall be defined herein as the "Cash Amount."
A form for use by JCN shareholders to elect to
receive cash and other appropriate and customary transmittal
material (which shall specify that delivery shall be effected
only upon proper delivery of the certificates theretofore
representing JCN Common Stock ("Old Certificates") to an
exchange agent designated by Highwoods (the "Exchange Agent"))
in such form as Highwoods and JCN shall mutually
agree ("Election Form") shall be mailed concurrently with the
mailing of the Proxy Statement required by Section 8.1 hereof,
or on such other date as Highwoods and JCN shall mutually
agree ("Mailing Date") to each holder of record of JCN Common
Stock on the record date ("Record Date") for the JCN
shareholders entitled to vote at the shareholders meeting to
approve the Merger as required by Section 8.1 (the "JCN
Shareholders Meeting").
Each Election Form shall permit a holder (or the
beneficial owner through appropriate and customary
documentation and instructions) of JCN Common Stock to elect
to receive cash with respect to all or a portion of such
holder's JCN Common Stock.
Any shares of JCN Common Stock with respect to which
the holder (or the beneficial owner, as the case may be)
elects to receive cash and does not dissent shall be referred
to herein as the "Cash Election Shares." Any shares of JCN
Common Stock with respect to which the holder (or the
beneficial owner, as the case may be) either does not submit
an Election Form or does not elect to receive cash and does
not dissent, shall be collectively referred to herein as
"Stock Election Shares."
Any of the elections set forth in the foregoing
paragraph shall have been properly made only if the Exchange
Agent shall have actually received an effective, properly
completed Election Form on or before 5:00 p.m. on the fifth
business day prior to the date of the JCN Shareholders Meeting
(or such other time and date as Highwoods and JCN may mutually
agree, including as a result of any adjournment or
postponement of the JCN Shareholders Meeting) (the "Election
Deadline") which is not revoked or changed prior to the
Election Deadline. Any Election Form may be revoked or changed
by the person submitting a subsequent Election Form at or
prior to the Election Deadline. In the event an Election Form
is revoked prior to the Election Deadline, the shares of JCN
Common Stock represented by such Election Form shall become
Stock Election Shares unless the Exchange Agent shall have
actually received an effective, properly completed Election
Form prior to the Election Deadline and such Election Form is
not revoked or changed prior to the Election Deadline. Subject
to the terms of this Agreement and of the Election Form, the
Exchange Agent shall have reasonable discretion to determine
whether any election, revocation or change has been properly
or timely made and to disregard immaterial defects in the
Election Forms, and any good faith decisions of the Exchange
Agent regarding such matters shall be binding and conclusive.
The Exchange Agent shall promptly notify JCN of any defect in
an
Election Form other than an immaterial defect disregarded in
good faith by the Exchange Agent. Subject to the foregoing
sentence, neither Highwoods nor the Exchange Agent shall be
under any obligation to notify any person of any defect in an
Election Form.
Within three business days after the Election
Deadline, Highwoods shall cause the Exchange Agent to effect
the allocation among the holders of JCN Common Stock in
accordance with the Election Forms; provided, however, if the
amount of cash that would be issued upon the conversion of the
Cash Election Shares is greater than the amount by which the
Cash Amount exceeds the Dissenting Share Amount (the "Maximum
Cash Election Amount"), then the Exchange Agent shall convert
a sufficient number of Cash Election Shares (other than
Dissenting Shares) into the right to receive the Per Share
Stock Consideration, which Cash Election Shares shall be
selected pro rata from among all of the holders thereof, based
upon the aggregate number of Cash Election Shares held by each
of such holders, such that the amount of cash that will be
issued in the Merger to satisfy the non-converted Cash
Election Shares equals as closely as practicable the Maximum
Cash Election Amount.
Highwoods shall, at least two business days prior to
the date of the JCN Shareholders Meeting, communicate to JCN
the aggregate allocation of stock and cash, the amount of
stock and cash going to each of JCN's shareholders, and the
method in which such amounts were calculated.
SECTION II
AMENDMENT TO ARTICLE 9
Section 2.1 Waiver by Highwoods of Certain Obligations. The
introductory paragraph to Section 9.1 of the Agreement is hereby amended in its
entirety to read as follows:
9.1 Conditions to Obligations of Each Party. The
respective obligations of each Party to perform this Agreement
and consummate the Merger and the other transactions
contemplated hereby are subject to the satisfaction of the
conditions set forth below in this Section 9.1. JCN may waive,
pursuant to Section 11.6, one or more of the following
conditions. Highwoods hereby irrevocably waives and agrees to
waive immediately prior to Closing, pursuant to Section 11.6,
all of the conditions set forth in Section 9.1(b) (except for
the filing of the Articles of Merger as contemplated by
Section 1.1) and the condition
set forth in Section 9.1(c) that JCN obtain from Principal
Mutual Insurance Company the Consent to the Merger referred to
in Section 9.1 of the JCN Disclosure Memorandum.
SECTION III
AMENDMENT TO ARTICLE 10
Section 3.1 Waiver by Highwoods of Certain Termination Rights. Section
10.1(d)(i) is hereby amended in its entirety to read as follows:
(i) Highwoods shall, after using its best
efforts, have been unable to satisfy the condition to
closing set forth in either Section 9.1(e) or (f), to
the extent required for consummation of the Merger
and the other transactions contemplated hereby, or
SECTION IV
AMENDMENT TO ARTICLE 11.1
Section 4.1 Definitions.
(a) Section 11.1(a) is hereby amended by adding the phrase
",as such Section has been amended by Amendment No. 1 to this
Agreement" to the end of the definition of "Per Share Stock
Consideration".
(b) Section 11.1(b) is hereby amended by adding the phrase "as
amended by Amendment No. 1 to this Agreement" after the end of each of
the definitions of "Cash Election Shares" and "Maximum Cash Election
Amount".
SECTION V
GENERAL PROVISIONS
Section 5.1 Entire Agreement. Except as otherwise expressly provided
herein, this Amendment (including the Agreement and the documents and
instruments referred to therein) constitutes the entire agreement between the
Parties with respect to the transactions contemplated hereunder and in the
Agreement and supersedes all other arrangements or understandings with respect
thereto, written or oral (except for the Confidentiality Agreement referred to
in Section 8.6(b) of the Agreement and any correspondence from any Party waiving
any rights or obligations or consenting to any actions taken by or on behalf of
another party).
Section 5.2 Counterparts. This Amendment may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
Section 5.3 Captions, Articles and Sections. The captions contained in
this Amendment are for reference purposes only and are not part of this
Amendment. Unless otherwise indicated, all references to particular Articles or
Sections shall mean and refer to the referenced Articles and Sections of this
Amendment.
Section 5.4 References to the Agreement. From and after the execution
of this Amendment, all references in the Agreement to "this Agreement,"
"hereof," "herein" and similar terms shall mean and refer to the Agreement as
amended by this Amendment, and all references in other documents to the
Agreement shall mean the Agreement as amended by this Amendment. This Amendment
shall not be modified, supplemented or terminated in any manner whatsoever
except by written instrument signed by the party against which such
modification, supplement or termination is sought to be enforced.
Section 5.5 Ratification and Confirmation. The Agreement is hereby
ratified and confirmed and, except as herein amended, remains in full force and
effect.
Section 5.6 Governing Law. This Amendment shall be governed by and
construed in accordance with the Laws of the State of Missouri, without regard
to any applicable conflicts of Laws.
IN WITNESS WHEREOF, Highwoods, Sub, and JCN have caused this Amendment
to be signed by their respective duly authorized officers as of the date first
written above.
HIGHWOODS PROPERTIES, INC.
By: /s/ Ronald P. Gibson
Name: Ronald P. Gibson
Title: President/CEO
JACKSON ACQUISITION CORP.
By: /s/ Ronald P. Gibson
Name: Ronald P. Gibson
Title: President/CEO
J.C. NICHOLS COMPANY
By: /s/ Barrett Brady
Name: Barrett Brady
Title: President and
Chief Executive Officer