Introductory Note
As previously disclosed in the Current Report on Form 8-K filed by J. Alexander’s Holdings, Inc., a Tennessee corporation (the “Company”), with the Securities and Exchange Commission (the “SEC”) on July 6, 2021, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”), dated as of July 2, 2021, by and among the Company, SPB Hospitality LLC, a Delaware limited liability company (“Parent”), and Titan Merger Sub, Inc., a Tennessee corporation and an indirect, wholly-owned subsidiary of Parent (“Merger Sub”), which provided for Merger Sub to be merged with and into the Company (the “Merger”), with the Company surviving as an indirect, wholly-owned subsidiary of Parent. On September 30, 2021, the Merger became effective and the Company and Parent took various other actions, as discussed further below.
| Item 1.02 | Termination of a Material Definitive Agreement |
On September 30, 2021, in connection with the consummation of the Merger, all outstanding obligations in respect of principal, interest, expenses, fees and other charges under that certain Fourth Amended and Restated Loan Agreement, dated as of October 28, 2020 (the “Loan Agreement”), between J. Alexander’s, LLC, a Tennessee limited liability company (the “Borrower”), and Pinnacle Bank (the “Lender”) were paid in full. The aggregate prepayment amount was $13,065,650.52 (the “Payoff Amount”) and, upon payment of the Payoff Amount, the obligations of the Borrower, including the Company and its other subsidiaries, to the Lender thereunder were satisfied in full, the Loan Agreement and all related loan documents were terminated and all liens and security interests granted thereunder were released and terminated.
| Item 2.01 | Completion of Acquisition or Disposition of Assets. |
On September 30, 2021, pursuant to the terms of the Merger Agreement, the Merger was completed, with Merger Sub being merged with and into the Company, with the Company surviving the Merger as an indirect, wholly-owned subsidiary of Parent. At the effective time of the Merger, each outstanding share of the Company’s common stock, par value $0.001 per share (the “Common Stock”), was cancelled and converted into the right to receive an amount in cash equal to $14.00 per share, without interest, pursuant to the Merger Agreement. A description of the consideration payable to holders of the Company’s options, performance share awards and restricted share awards and to holders of certain Class B Units of J. Alexander’s Holdings, LLC is set forth under the heading “The Merger Agreement—Treatment of Equity Awards” in the Company’s Definitive Proxy Statement filed with the SEC on August 23, 2021 (the “Proxy Statement”), and such description is incorporated herein by reference.
The total purchase price paid in connection with the Merger was approximately $220 million. The source of funds for the consideration paid in the Merger was a combination of equity contributions from funds and accounts managed by affiliates of Fortress Investment Group LLC, which is an affiliate of Parent and Merger Sub, as well as proceeds from debt financings.
The foregoing description, including the portions incorporated by reference herein, does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Merger Agreement, which is incorporated by reference as Exhibit 2.1 hereto and incorporated herein by reference.
| Item 3.01 | Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing. |
In connection with the completion of the Merger, on September 30, 2021, the Company (i) notified the New York Stock Exchange (the “NYSE”) that the Merger has been completed and (ii) submitted a written request to the NYSE for the NYSE to cease trading of the Common Stock on the NYSE and to suspend the listing of the Common Stock, in each case prior to market open on September 30, and to file with the SEC an application on Form 25 to delist the Common Stock from the NYSE and deregister the Common Stock under Section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
The Company intends to file with the SEC a certification on Form 15 with respect to the Common Stock requesting the deregistration of the Common Stock under Section 12(g) of the Exchange Act and the suspension of the Company’s reporting obligations under Sections 13 and 15(d) of the Exchange Act.
The information set forth in Item 2.01 above (including the section of the Proxy Statement listed therein) is incorporated herein by reference.
| Item 3.03 | Material Modifications to Rights of Security Holders. |
Upon the effective time of the Merger on September 30, 2021, each issued and outstanding share of Common Stock was canceled and ceased to exist, and holders of Common Stock immediately prior to the effective time of the Merger ceased to have any rights as shareholders of the Company (other than their right to receive the merger consideration of $14.00 per share in cash, without interest, pursuant to the Merger Agreement). The foregoing description does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Merger Agreement, which is incorporated by reference as Exhibit 2.1 hereto and incorporated herein by reference.
The information set forth in Item 2.01, Item 3.01, Item 5.01 and Item 5.02 is incorporated herein by reference.
