Item 1.01 Entry into a Material Definitive Agreement.






Merger Agreement

On January 20, 2020, CSS Industries, Inc., a Delaware corporation (the "Company"), entered into an Agreement and Plan of Merger (the "Merger Agreement") with IG Design Group Americas, Inc., a Georgia corporation ("Parent"), TOM MERGER SUB INC., a Delaware corporation and direct, wholly owned subsidiary of Parent ("Merger Sub"), and IG Design Group Plc, a public limited company incorporated and registered in England and Wales ("TopCo Parent"). Pursuant to the Merger Agreement, and upon the terms and subject to the conditions thereof, Merger Sub will, as promptly as practicable, commence a tender offer (the "Offer") to purchase all of the outstanding shares of the Company's common stock, par value $0.10 per share ("Company Common Stock"), at a price per share equal to $9.40 (the "Offer Price"), net to the seller in cash, without interest and subject to any applicable tax deduction or withholding.

The obligation of Merger Sub to purchase shares of Company Common Stock tendered in the Offer is subject to the satisfaction or waiver of certain conditions set forth in the Merger Agreement, including (i) a minimum of 51% of the shares of Company Common Stock then outstanding being tendered in the Offer, (ii) the accuracy of the Company's representations and warranties contained in the Merger Agreement, subject to certain specified materiality qualifiers, (iii) the Company's performance in all material respects of its obligations under the Merger Agreement, (iv) TopCo Parent's receipt (either directly or indirectly through any of its subsidiaries) of the proceeds of the debt and equity financing or confirmation by the financing sources that the debt and equity financing will be available at the consummation of the Offer (the "Funding Condition"), and (v) each of the other conditions set forth in Exhibit B to the Merger Agreement.

The Offer will expire at midnight (New York City time) on the date that is 20 business days following the commencement of the Offer, unless extended in accordance with the terms of the Offer and the Merger Agreement and the applicable rules and regulations of the United States Securities and Exchange Commission (the "SEC").

Subject to the provisions of the Merger Agreement and in accordance with Section 251(h) of the Delaware General Corporation Law, immediately following Merger Sub's acceptance for payment (the "Acceptance Time") of all shares of Company Common Stock validly tendered pursuant to the Offer (the "Offer Closing"), Merger Sub will merge with and into the Company, with the Company surviving the merger as the surviving corporation (the "Merger"), without a meeting of the stockholders of the Company.

The board of directors of the Company (the "Board") and the special committee of the Board have each unanimously approved the Merger Agreement, the Merger and the other transactions contemplated by the Merger Agreement.

At the effective time of the Merger (the "Effective Time"), each share of Company Common Stock (except for shares owned, directly or indirectly, by Parent, Merger Sub or the Company (including shares held as treasury stock or otherwise), which will be cancelled without any consideration in exchange therefor, and by stockholders who have perfected their appraisal rights under Delaware law) will be converted into the right to receive the Offer Price in cash, without interest and subject to any applicable tax deduction or withholding.

The Merger Agreement provides that, at the Effective Time, (i) each outstanding stock option to acquire shares of Company Common Stock (each, a "Company Stock Option"), whether or not then vested or exercisable, will be cancelled in exchange for a cash payment, without interest and less applicable tax withholding, equal to the product of (A) the excess, if any, of the Offer Price over the exercise price per share of such Company Stock Option, multiplied by (B) the number of shares of Company Common Stock issuable upon the exercise of such Company Stock Option as of immediately prior to the Effective Time; (ii) each outstanding restricted stock unit that is not subject to performance-based vesting (each, a "Company RSU") will fully vest and be cancelled in exchange for a cash payment, without interest and less applicable tax withholding, equal to the product of (A) the Offer Price, multiplied by (B) the number of shares of Company Common Stock subject to such Company RSU; and (iii) each outstanding restricted stock unit that is subject to performance-based vesting (each, a "Company PSU") will be cancelled in exchange for a cash payment, without interest and less applicable tax withholding, equal to the product of (A) the Offer Price, multiplied by (B) the number of shares of Company Common Stock subject to such Company PSU (as determined after giving effect to the deemed achievement at target performance levels). Any Company Stock Option that has an exercise price per share that is greater than or equal to the Offer Price will be cancelled at the Effective Time without payment of any consideration.

The Merger Agreement contains representations, warranties and covenants by the parties customary for a transaction of this nature. Among other things, during the period between the execution of the Merger Agreement and the earlier of the consummation of the Merger or termination of the Merger Agreement, the Company has agreed to conduct its business in the ordinary course consistent with past practice and has agreed to certain other operating covenants, as set forth more fully in the Merger Agreement.

The Company has also agreed not to (i) solicit proposals relating to alternative competing transactions, (ii) enter into discussions or negotiations or provide . . .

Item 3.03 Material Modification to Rights of Security Holders.

The disclosure set forth under the heading "Rights Agreement Amendment" in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.03.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors;


          Appointment of Certain Officers; Compensatory Arrangements of Certain
          Officers.

On January 17, 2020, the Human Resources Committee of the Board approved, subject to and contingent upon the consummation of the Merger, the payment, in the form of cash, of (i) the 30% discretionary component under the Company's Management Incentive Program (the "MIP") and (ii) the performance component under the MIP, the amount of which shall be determined based on fiscal year 2020 financial metrics, in each case to all participants in the MIP employed by the Company as of the closing of the Merger. All such payments will be paid in June 2020.




Item 8.01 Other Events.

On January 20, 2020 the Company issued a press release announcing entry into the Merger Agreement. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein.

Item 9.01 Financial Statements and Exhibits.






(d) Exhibits



Exhibit No.                                  Description

  2.1               Agreement and Plan of Merger, dated as of January 20, 2020, by
                  and among CSS Industries, Inc., IG Design Group Americas, Inc.,
                  TOM MERGER SUB INC. and IG Design Group Plc.*

  4.1               Amendment to Rights Agreement, dated as of January 20, 2020,
                  between CSS Industries, Inc. and American Stock Transfer & Trust
                  Company, LLC.

  99.1              Press Release, dated January 20, 2020.

* Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Company agrees to furnish a copy of any omitted schedule to the SEC upon request.




Cautionary Statement

This document contains forward-looking statements, including statements regarding the proposed acquisition of the Company by Parent and TopCo Parent. From time to time, oral or written forward-looking statements may also be included in other information released to the public. These forward-looking statements are intended to provide management's current expectations or plans for our future operating and financial performance, based on assumptions currently believed to be valid. Forward-looking statements often contain words such as "may," "can," "could," "would," "should," "expects," "anticipates," "estimates," "intends," "plans," "believes," "seeks," "will," "is likely to," "scheduled," "positioned to," "continue," "forecast," "aim," "goal," "target," "predicting," "projection," "potential" or similar expressions, although not all forward-looking statements contain these words. Forward-looking statements may include references to goals, plans, strategies, objectives, projected costs or savings, anticipated future performance, results, events or transactions of the Company and the expected timing of the proposed transaction with Parent and other statements that are not strictly historical in nature. These forward-looking statements are based on management's current expectations, forecasts and assumptions and could ultimately prove inaccurate. This means the forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, including, but not limited to: uncertainties as to the timing of the tender offer and the subsequent merger; uncertainties as to how many of the Company's stockholders will tender their shares in the offer; the possibility that competing offers will be made; the ability to receive the required consents and regulatory approvals for the proposed transaction and to satisfy the other conditions to the closing of the transaction on a timely basis or at all; the occurrence of events that may give rise to a right of one or both of the Company and Parent to terminate the merger agreement; the risk that, prior to the completion of the transaction, the Company's business and its relationships with employees, collaborators, vendors and other business partners could experience significant disruption due to transaction-related uncertainty; the risk that stockholder litigation in connection with the Offer or the Merger may result in significant costs of defense, indemnification and liability; negative effects of the announcement of the transaction on the market price of Company Common Stock and/or on the Company's business, financial condition, results of operations and financial performance; risks associated with transaction-related litigation; and the ability of the Company to retain and hire key personnel; and the risks and uncertainties pertaining to the Company's business, including those detailed under "Risk Factors" and elsewhere in the Company's public periodic filings with the SEC. There can be no assurance that the proposed transaction or any other transaction described above will in fact be consummated in the manner described or at all. Stockholders, potential investors and other readers are urged to consider these risks and uncertainties in evaluating forward-looking statements and are cautioned not to place undue reliance on the forward-looking statements. It is not possible to anticipate or foresee all risks and uncertainties, and investors should not consider any list of risks and uncertainties to be exhaustive or complete. For additional information on identifying factors that may cause actual results to vary materially from those stated in forward-looking statements, please see the Company's statements and reports on Forms 10-K, 10-Q and 8-K and Schedule 14D-9 filed with or furnished to the SEC and other written statements made by the Company from time to time. The forward-looking information herein is given as of this date only and is qualified in its entirety by this cautionary statement, and the Company undertakes no obligation to revise or update it.

Additional Information and Where to Find It

The tender offer for the outstanding shares of Company Common Stock has not yet commenced. This announcement is for informational purposes only and is neither an offer to purchase nor a solicitation of an offer to sell shares of the Company, nor is it a substitute for the tender offer materials that Parent, TopCo Parent and/or Merger Sub will file with the SEC upon commencement of the tender offer. At the time the tender offer is commenced, TopCo Parent, Parent and/or Merger Sub will file tender offer materials on Schedule TO, including the offer to purchase, letter of transmittal and other related materials, with respect to the tender offer, and Company will file a Solicitation/Recommendation Statement on Schedule 14D-9 (the "Solicitation/Recommendation Statement") with the SEC with respect to the tender offer. The solicitation and offer to buy Company Common Stock will be made only pursuant to an offer to purchase and related materials that TopCo, Parent and Merger Sub intend to file with the SEC. THE TENDER OFFER MATERIALS (INCLUDING AN OFFER TO PURCHASE, A RELATED LETTER OF TRANSMITTAL AND CERTAIN OTHER TENDER OFFER DOCUMENTS) AND THE SOLICITATION/RECOMMENDATION STATEMENT WILL CONTAIN IMPORTANT INFORMATION. INVESTORS AND STOCKHOLDERS ARE ADVISED TO READ THESE DOCUMENTS CAREFULLY WHEN THEY BECOME AVAILABLE (AS EACH MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME) BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION THAT HOLDERS OF COMPANY COMMON STOCK SHOULD CONSIDER BEFORE MAKING ANY DECISION REGARDING TENDERING THEIR SHARES. The Offer to Purchase, the related Letter of Transmittal and certain other tender offer documents, as well as the Solicitation/Recommendation Statement, will be made available to all holders of shares of Company Common Stock at no expense to them. Investors and stockholders may obtain the Schedule TO, the Schedule 14D-9 and other relevant documents filed with the SEC free of charge from the SEC's website at www.sec.gov. The documents filed by the Company with the SEC may also be obtained free of charge at the Company's website at http://www.cssindustries.com/investor-relations.

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