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| Share Name | Share Symbol | Market | Type |
|---|---|---|---|
| Factory Card & Party Outlet (MM) | NASDAQ:FCPO | NASDAQ | Common Stock |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0 | - |
| Delaware | 333-21859 | 36-3652087 | ||
| (State or other jurisdiction | (Commission File | (IRS Employer | ||
| of incorporation) | Number) | Identification No.) |
-3-
-4-
Item 1.01 Entry into a Material Definitive Agreement
On November 6, 2007, in connection with the Offer described in Item 5.01 below, Factory Card &
Party Outlet Corp., a Delaware corporation (the “Company”), entered into a Third Amendment to that
certain Loan and Security Agreement dated as of April 9, 2002, as amended (the “Loan Agreement”),
among Factory Card Outlet of America, Ltd., as borrower, the lenders thereto as Well Fargo Retail
Finance, LLC, as arranger, collateral agent and administrative agent. The amendment provides that
all amounts outstanding under the Loan Agreement, together with a fee of $87,332.04, will be paid
off on or before January 2, 2008 and not upon consummation of the Offer (as defined below).
The foregoing summary of the amendment is not complete, and is qualified in its entirety by,
and should be read in conjunction with the third amendment to our Loan Agreement dated as of
November 6, 2007 which is attached hereto as Exhibit 99.1 and is incorporated by reference herein.
Item 5.01 Change in Control of Registrant
On November 6, 2007, the Company and AAH Holdings Corporation (“AAH Holdings”), the parent of
Amscan Holdings, Inc. (“Parent”) and Amscan Acquisition, Inc. (“Purchaser”), issued a press release
announcing that Parent and Purchaser had successfully completed its tender offer (the “Offer”) for
all outstanding shares of common stock, par value $.01 per share (each, a “Share”), of the Company
pursuant to the terms of the Agreement and Plan of Merger, dated as of September 17, 2007, between
Parent, Purchaser and the Company (the “Merger Agreement”). The Offer expired at midnight, Eastern
time, on November 5, 2007. According to the depositary for the Offer, Wells Fargo Bank, N.A., as of
the expiration of the Offer, a total of 2,989,073 shares (representing approximately 86% of the
outstanding Shares), including 76,581 shares subject to guarantees of delivery, were tendered and
not withdrawn prior to the expiration of the Offer. The Purchaser accepted for payment and
purchased all Shares validly tendered and not properly withdrawn pursuant to the Offer. AAH
Holdings also announced that, in accordance with the terms of the Merger Agreement, Purchaser has
commenced a subsequent offering period for all of the remaining untendered shares which will expire
at 11:59 p.m., Eastern time, on November 15, 2007, unless extended.
The information in Item 5.02 below is incorporated herein by reference. The other information
required by Item 5.01(a) of Form 8-K is contained in (i) the Company’s Solicitation/Recommendation
Statement on Schedule 14D-9 (the “Statement”) originally filed with the Securities and Exchange
Commission (the “SEC”) on October 1, 2007, as subsequently amended, and (ii) the Tender Offer
Statement on Schedule TO, originally filed by the Purchaser and Parent with the SEC on October 1,
2007, as subsequently amended, and such information is incorporated herein by reference.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain Officers
In connection with the Offer described in Item 5.01 above, Richard E. George, Peter Holmes,
Martin G. Mand and Robert S. Sandler resigned from the Board of Directors of the Company (the
“Board”), effective as of November 6, 2007. Pursuant to the terms of the Merger
Agreement, the resignations followed the Purchaser’s acceptance for payment and purchase of
all Shares validly tendered and not properly withdrawn pursuant to the Offer.
In accordance with the Merger Agreement, following completion of the Offer, four members of
the Company’s Board of Directors resigned, and the following designees of Parent were appointed to
the Company’s Board of Directors: Gerald C. Rittenberg, James M. Harrison and Robert J. Small.
In accordance with the Merger Agreement, four of the Company’s existing directors, Gary Rada, Ben
Evans, Mone Anathan and Patrick O’Brien, will remain on the Board pending completion of the Merger.
In addition, subject to the terms of the Merger Agreement, pending completion of the Merger,
Parent is entitled, at its request, to have its designees appointed to the appropriate committees
of the Board.
As previously disclosed, bonuses under the Company’s 2007 Management Incentive Program are
payable to eligible associates based on the level of achievement of pre-established Company
performance goals (earnings before taxes for officers). The Program provides that, in the event of
a Change in Control (the Offer constitutes a Change in Control), the bonuses thereunder shall be
based on actual results through the last completed fiscal month of fiscal 2007 preceding the Change
in Control plus budgeted results through the end of fiscal 2007. On November 1, 2007, the Board of
Directors of the Company, upon the recommendation of the Compensation Committee of the Board of
Directors, approved the payment of cash bonus awards under the Company’s 2007 Management Incentive
Program to certain officers and employees, including the below named executive officers. The
bonuses for the named executive officers are listed below: Gary W. Rada, $170,893; Timothy F.
Gower, $58,833; Timothy J. Benson, $40,323; and Michael Perri, $55,940. The payment of these cash
bonus awards was contingent upon the consummation of the Offer, which occurred on November 6, 2007
as described in Item 5.01 above.
Item 9.01 Financial Statements and Exhibits
(d)
Exhibits
.
Exhibit No.
Description
20.1
Solicitation/Recommendation Statement on Schedule 14D-9 of
Factory Card & Party Outlet Corp. (incorporated by reference
in its entirety as filed with the Securities and Exchange
Commission on October 1, 2007, as amended).
20.2
Section 14(f) Information Statement of Factory Card & Party
Outlet Corp., dated October 1, 2007 (incorporated by reference
to Schedule II of the Solicitation/Recommendation Statement on
Schedule 14D-9 of Factory Card & Party Outlet Corp. filed with
the Securities and Exchange Commission on October 1, 2007).
99.1
Third Amendment, dated as of November 6, 2007, to that certain
Loan and Security Agreement dated as of April 9, 2002, as
amended, among Factory Card Outlet of America, Ltd., as
borrower, the lenders thereto as Well Fargo Retail Finance,
LLC, as arranger, collateral agent and administrative agent.
Exhibit No.
Description
99.2
Tender Offer Statement on Schedule TO of Amscan Holdings, Inc.
and Amscan Acquisition, Inc. (incorporated by reference in its
entirety as filed with the Securities and Exchange Commission
on October 1, 2007, as amended).
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
FACTORY CARD & PARTY OUTLET CORP.
/s/ Gary W. Rada
Gary W. Rada
President and Chief Executive Officer
Dated: November 6, 2007
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