ADVO - Valassis (M&A)

Summary

Formation of Leading Media Services Company

$37 per share: $1.3B total

Announced 7.05.06

Proceedings scheduled to begin 12.11.06

Advo sues Valassis to enforce merger agreement 9.08.06

Advo responds to Valassis' meritless claims 9.01.06

Advo says Valassis lawsuit is without merit 8.30.06

Closed 2.22.07

Advisors

Financial

VCI: Bear Stearns
AD: Citigroup

Legal

VCI: McDermott Will & Emery
AD: Wachtell Lipton Rosen & Katz

Merger Agreement

General

EDGAR filing
Hyperlinked version
Detailed hyperlinked index follows

Article I The Merger

1.01 The Merger
1.02 Closing
1.03 Effective Time
1.04 Effects of the Merger
1.05 Certificate of Incorporation and Bylaws
1.06 Directors and Officers of Sub
1.07 Reservation of Right to Revise Transaction

Article II Effect of the Merger On the Capital Stock of the
Constituent Corporations; Exchange of
Certificates

2.01 Effect on Capital Stock
2.02 Exchange of Certificates
2.03 Stock Options
2.04 Stock Exchange Listing
2.05 Note Purchase Agreement

Article III Company Reps

3.01(a) Organization, Standing and Corporate Power
3.01(b) Subsidiaries
3.01(c) Capital Structure
3.01(d) Authority; Noncontravention
3.01(e) Company SEC Documents
3.01(f) Information Supplied
3.01(g) Absence of Certain Changes or Events
3.01(h) [INTENTIONALLY OMITTED]
3.01(i) Litigation
3.01(j) Material Contracts
3.01(k) Compliance with Laws; Environmental Matters
3.01(l) Labor Relations
3.01(m) ERISA Compliance
3.01(n) Golden Parachute Payments
3.01(o) Taxes
3.01(p) Title to Properties
3.01(q) Intellectual Property
3.01(r) Voting Requirements
3.01(s) State Takeover Laws
3.01(t) Brokers and Other Advisors
3.01(u) Opinion of Financial Advisor
3.01(v) Rights Agreement

Article III Parent Reps

3.02(a) Organization, Standing and Corporate Power
3.02(b) Authority; Noncontravention
3.02(c) Capital Structure
3.02(d) Information Supplied
3.02(e) Capital Resources
3.02(f) Brokers
3.02(g) Litigation
3.02(h) Ownership of Company Common Stock
3.02(i) No Vote of Parent Stockholders

Article IV Covenants Relating to Conduct of Business;
No Solicitation

4.01 Conduct of Business by the Company
4.02 No Solicitation

Article V Additional Agreements

5.01 Preparation of the Proxy Statement; Shareholders
Meeting
5.02 Access to Information; Confidentiality
5.03 Reasonable Best Efforts
5.04 Indemnification, Exculpation and Insurance
5.05 Fees and Expenses
5.06 Public Announcements
5.07 Shareholder Litigation
5.08 Employee Matters
5.09 Rights Agreement

Article VI Conditions Precedent

6.01 Each Party
6.02 Parent and Sub
6.03 Company

Article VII Termination, Amendment and Waiver

7.01 Termination
7.02 Effect of Termination
7.03 Amendment
7.04 Extension; Waiver
7.05 Procedure for Termination or Amendment

Article VIII General Provisions

8.01 Nonsurvival of Representations and Warranties
8.02 Notices
8.03 Definitions
8.04 Interpretation
8.05 Consents and Approvals
8.06 Counterparts
8.07 Entire Agreement; No Third-Party Beneficiaries
8.08 Governing Law
8.09 Assignment
8.10 Specific Enforcement; Consent to Jurisdiction
8.11 Waiver of Jury Trial
8.12 Severability
Annex I - Index of Defined Terms

Proxy Solicitation

Definitive proxy statement 8.10.06

Table of contents

Preliminary proxy statement 7.14.06

Table of contents

Deal Protection

No shop covenant

Merger agreement §4.2
Proxy statement disclosure scroll down

Break-up fee

$38 mm, plus out-of-pocket expenses
Agreement §7.2
Proxy statement disclosure

Regulatory Approvals

HSR Act

Merger agreement §5.3
Proxy statement disclosure

Fairness Opinion

Citigroup fairness opinion

Proxy statement disclosure

Tax Matters

Disclosure

Proxy statement disclosure

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