Commonwealth - Citizens (M&A)

Commonwealth Telephone Enterprises (CTCO)
Citizens Communications Co (CZN)
$1.16B Taxable Cash - Stock Merger

Summary

Will create 7^th largest local telephone exchange

$31.31 plus 0.768 CZN share, per CTCO share; $1.16B total

Valued at $41.72 per CTCO share
Taxable transaction
CZN stock chart
CTCO stock chart

Announced 9.18.06

Developments

Tender Offer Expires 4.23.07

Press release
Schedule TO Amendment #1

Advisors

Financial

CZN :Citigroup
CTCO : Evercore Partners

Legal

CZN : Cravath
CTCO : Davis Polk & Wardell

Merger Agreement

General

EDGAR filing
Hyperlinked version
Detailed hyperlinked index follows

Article 1 The Merger

1.01 The Merger
1.02 Conversion of Shares
1.03 Surrender and Payment
1.04 Treatment of Equity Compensation Awards
1.05 Adjustments
1.06 Fractional Shares
1.07 Withholding Rights
1.08 Lost Certificates

Article 2 The Surviving Corporation

2.01 Articles of Incorporation
2.02 Bylaws
2.03 Directors and Officers

Article 3 Company Reps

3.01 Organization and Authority
3.02 No Breach
3.03 Consents and Approvals
3.04 Approval of Board; Fairness Opinion; Vote Req
3.05 Capitalization
3.06 Subsidiaries
3.07 SEC Filings and the Sarbanes-Oxley Act
3.08 Financial Statements
3.09 Disclosure Documents
3.10 Absence of Certain Changes or Events
3.11 No Undisclosed Material Liabilities
3.12 Litigation
3.13 Taxes
3.14 Employee Benefit Matters
3.15 Labor Matters
3.16 Compliance with Laws
3.17 Finders Fees
3.18 Title to Properties; Encumbrances; Intellectual
Property
3.19 Environmental Matters
3.20 Contracts
3.21 Antitakeover Statutes
3.22 No Other Representations

Article 4 Parent Reps

4.01 Organization and Authority
4.02 No Breach
4.03 Consents and Approvals
4.04 Approval of the Board; No Vote Required
4.05 Capitalization
4.06 SEC Filings and the Sarbanes-Oxley Act
4.07 Financial Statements
4.08 Disclosure Documents
4.09 Absence of Certain Changes or Events
4.10 No Undisclosed Material Liabilities
4.11 Litigation
4.12 Taxes
4.13 Compliance with Laws
4.14 Finders Fees
4.15 Environmental Matters
4.16 Financing
4.17 Ownership of Shares
4.18 No Other Representations

Article 5 Covenants of the Company

5.01 Conduct of the Company
5.02 Stockholder Meeting; Board Recommendation
5.03 Non-Solicitation; Other Offers
5.04 Affiliates

Article 6 Covenants of Parent

6.01 Conduct of Parent
6.02 Obligations of Merger Subsidiary
6.03 Voting of Shares
6.04 Director and Officer Liability
6.05 Stock Exchange Listing
6.06 Personnel Matters

Article 7 Other Agreements of Parent and the Company

7.01 Proxy Statement; Registration Statement
7.02 Reasonable Best Efforts
7.03 Certain Filings
7.04 Public Announcements
7.05 Notices of Certain Events
7.06 Further Assurances
7.07 Access to Information
7.08 Section 16 Matters
7.09 Company Convertible Notes
7.10 Performance Awards
7.11 Stockholder Litigation
7.12 Cooperation with Respect to Financing

Article 8 Closing; Conditions to the Merger

8.01 Closing
8.02 Each Party
8.03 Parent and Merger Subsidiary
8.04 Company

Article 9 Termination

9.01 Termination
9.02 Effect of Termination

Article 10 Miscellaneous

10.01 Notices
10.02 Survival of Representations, Warranties and
Covenants
10.03 Amendments; No Waivers
10.04 Expenses
10.05 Parties in Interest; Successors and Assigns
10.06 No Personal Liability
10.07 Governing Law
10.08 Jurisdiction
10.09 Waiver of Jury Trial
10.10 Interpretation
10.11 Specific Performance
10.12 Entire Agreement; Schedules
10.13 Counterparts; Effectiveness
10.14 Severability

Article 11 Definitions

11.01 Definitions

Proxy Solicitation

Form S-4 11.07.06

Table of contents

Amendment #1 12.20.06

Table of contents

Deal Protection

No shop covenant

Merger agreement §5.3
Proxy statement disclosure

Break-up fee

$37mm, plus out-of-pocket expenses
Agreement §9.2

Proxy statement disclosure

Regulatory Approvals

HSR Act

Merger agreement §7.3
Proxy statement disclosure

Fairness Opinion

Evercore fairness opinion

Proxy statement disclosure

Tax Matters

Disclosure

Proxy statement disclosure

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