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and approved of the merger agreement, determined that $22.50 a
share was a fair price, and recommended acceptance of the offer
to the shareholders of AHC. The obligation of AHC to effect the
merger was subject to various conditions, including approval of
the merger agreement by shareholders owning a majority of AHC
stock. The authority of AHC shareholders to withhold approval of
the merger was limited by the right of DC Acquisition and CDI to
proceed with the merger upon acquisition of a majority of the
outstanding shares. The terms of the tender offer provided:
Pursuant to the Certificate of Incorporation, as
amended, of the Company [AHC] and the Delaware Law, if
the Purchaser [DC Acquisition] acquires pursuant to the
Offer a majority of the outstanding Shares, then the
Purchaser will be able to assure that the requisite
number of affirmative votes in favor of the Merger will
be received even if no other stockholder votes in favor
of the Merger. Pursuant to the short form merger
provisions of the Delaware law, if the Purchaser holds
90% or more of the outstanding Shares, the Merger can
be effected, and the Purchaser intends to effect the
Merger, without a meeting or vote of the stockholders
of the Company.
The obligation of DC Acquisition and CDI to effect the
merger was also subject to various conditions. On August 3,
1988, pursuant to a tender offer, DC Acquisition offered to
purchase all of the issued and outstanding AHC stock for $22.50 a
share. The tender offer was conditioned on DC Acquisition’s
acquiring and owning at least 85 percent of the AHC stock upon
consummation of the tender offer (minimum tender condition). The
minimum tender condition could be waived by DC Acquisition in its
sole discretion. DC Acquisition and CDI also had the right to
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