Mr. Brigley says in his testimony that he does not recall reading the lockup provision in the prospectus.

The agreement contains a number of lockup provisions, including a requirement that the fund pay a $1 million fee if it terminates the merger.

But if they can't break the lockup provision, $115 a share is not enough for people to wait until 1999.

Although another bidder could emerge for Paramount, the companies agreed on a lockup provision that would make an acquisition much more expensive for an outsider.

There is also a "lockup" provision of the merger agreement, meant to discourage other suitors.

A person close to Kohlberg, Kravis said the firm would seek to enforce its right to buy four assets covered by the lockup provision.

The Supreme Court decision came just 24 hours after Judge Jacobs upheld the lockup provision.

That decision, if upheld on appeal, spells an almost definite victory for Kohlberg because the lockup provision is costly to any other buyer.

Maxwell contested not only the lockup provision, but also the fees that Kohlberg was to receive if the sale did not go through.

The lockup provision has discouraged several foundations from putting money into ESL, according to one hedge fund manager who serves on some foundation boards.