UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
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CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT: February 17, 2003
(Date of earliest event reported)
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INSIGNIA FINANCIAL GROUP, INC.
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE 1-14373 56-2084290
(State of Incorporation) (Commission File Number) (I.R.S. Employer Identification No.)
200 PARK AVENUE, NEW YORK, NEW YORK 10166
(Address of Principal Executive Offices) (Zip Code)
(212) 984-8033
(Registrant's Telephone Number, Including Area Code)
ITEM 5. OTHER EVENTS
Insignia Financial Group, Inc. ("Insignia"), CBRE Holding, Inc. ("Holding"), CB
Richard Ellis Services, Inc. ("CB") and Apple Acquisition Corp., a wholly owned
subsidiary of CB, have entered into an Agreement and Plan of Merger, dated as of
February 17, 2003 (the "Merger Agreement"), pursuant to which, upon the terms
and subject to the conditions set forth therein, Apple Acquisition Corp. will be
merged with and into Insignia (the "Merger"), with Insignia being the surviving
corporation in the Merger and becoming a wholly owned subsidiary of CB. The
Merger Agreement provides that Insignia's Certificate of Incorporation and the
Bylaws of Apple Acquisition Corp. will be the Certificate of Incorporation and
the Bylaws, respectively, of the surviving corporation. Under the Merger
Agreement, at closing each share of common stock, par value $0.01 per share, of
Insignia (the "Common Stock") will be converted into the right to receive $11.00
in cash (the "Common Merger Consideration"). In addition, Insignia has the
right, but not the obligation, to sell certain real estate assets prior to the
closing of the Merger. To the extent that Insignia receives more than a
specified amount of cash net proceeds (generally $45 million (net of expenses)
plus any amounts contributed or transferred to the entities holding these assets
between February 17, 2003, and the closing of the Merger) for these assets,
these excess cash net proceeds will be paid to holders of Common Stock,
options and warrants as additional Common Merger Consideration, up to an
additional $1.00 per share of Common Stock. There can be no assurance that
Insignia will sell any of these assets or, if it does, that it will receive more
than the specified amount of cash net proceeds through the asset sales. The
Merger Agreement further provides that all of Insignia's directors will resign
immediately prior to the completion of the Merger. Following the Merger,
Insignia will cease to be a reporting company under the Securities Exchange Act
of 1934, as amended, and its Common Stock will cease to be traded on the New
York Stock Exchange. The Merger is subject to approval by Insignia's
shareholders, receipt of debt financing, the receipt of regulatory approvals and
other customary closing conditions. The foregoing description of the Merger
Agreement is qualified in its entirety by reference to the Merger Agreement,
which is filed as an exhibit to this Form 8-K and is incorporated by reference
herein.
In connection with the Merger Agreement, several members of senior management of
Insignia entered into Voting Agreements with CB and Insignia (the "Voting
Agreements"). Pursuant to the terms and subject to the conditions of the Voting
Agreements, these individuals agreed to vote their shares in favor of approving
the Merger Agreement, the Merger and the other transactions contemplated by the
Merger and the Merger Agreement and to vote their shares against any acquisition
proposal from a third-party.
In order to finance the Merger and the other transactions contemplated by the
Merger Agreement, Blum Strategic Partners, L.P., Blum Strategic Partners II,
L.P. and Blum Strategic Partners II GmbH & Co. KG committed to make an aggregate
of up to $145 million of cash contributions to Holding, subject to the prior
satisfaction or waiver of each of the conditions to the Merger Agreement. In
addition, Credit Suisse First Boston committed to arrange up to $610,000,000 of
debt financing. The funding of this debt financing is subject to (i) there not
having occurred any event, change or condition that has had, or is reasonably
expected to have, a material adverse effect on the business, assets, operations,
conditions (financial or otherwise) or prospects of CB and its subsidiaries
after giving effect to the Merger (disregarding for this purpose certain real
estate related assets of Insignia), (ii) there not having occurred a Company
Material Adverse Effect (as defined in the Merger Agreement), (iii) CSFB having
received a certificate from CB certifying that the 2002 EBITDA of CB and its
subsidiaries and Insignia and its subsidiaries, as well as expected costs
savings from the Merger, is greater than a specified amount, (iv) the receipt by
CSFB of certain financial
information from CB and Insignia, (v) the securities to be issued by CB in the
CSFB financing, if any, and the loans to be made by CSFB and the other lenders,
each achieving a specified minimum rating from Moody's and S&P, (vi) the receipt
of regulatory approvals, (vii) the negotiation, execution and delivery of
definitive documentation with respect to the financing reasonably satisfactory
to CSFB and its counsel, and (viii) certain other customary conditions. CSFB,
commitment will expire if the initial borrowing does not occur on or before
July 14, 2003.
ITEM 7. EXHIBITS
10.1 Agreement and Plan of Merger, dated February 17, 2003, by and
among Insignia Financial Group, Inc., CBRE Holding, Inc., CB
Richard Ellis Services, Inc. and Apple Acquisition Corp.
99.1 Joint press release, dated February 18, 2003.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereto duly authorized.
INSIGNIA FINANCIAL GROUP, INC.
February 19, 2003
By: /s/ Adam B. Gilbert
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Name: Adam B. Gilbert
Title: Executive Vice President