FIRST AMENDMENT TO
ASSET PURCHASE AGREEMENT
This First Amendment (this "Amendment") to that certain
Asset Purchase Agreement (the "Asset Purchase Agreement"), dated
as of August 20, 1998, between Image Newco, Inc., a California
corporation (the "Buyer") and ▇▇▇ ▇▇▇▇▇'▇ Magnavox City, Inc., a
California corporation (the "Seller"), is entered into as of this
3rd day of October 1998 by and between the Buyer and the Seller
(collectively, the "Parties"). Capitalized of Mandalay Sports
Enterprises LLC, dated as of January 8, 1997 (as amended, the
"Operating Agreement"). Capitalized terms used in this Amendment
without definition shall have the meanings assigned to such terms
in the Asset Purchase Agreement.
WHEREAS, the Parties desire to amend the Asset Purchase
Agreement as hereinafter provided.
NOW THEREFORE, in consideration of the mutual premises
contained herein, and for other good and valuable consideration,
the receipt of which is hereby acknowledged, the Parties hereby
agree as follows:
1. Amendment to Asset Purchase Agreement. Section 9.1 is
hereby amended by replacing it in its entirety with the
following:
"9.1 Termination of Agreement.
Anything herein to the contrary notwithstanding, this
Agreement (except to the extent provided in Section 9.2) and the
transactions contemplated by this Agreement may be terminated
prior to the Closing by written notice by either party after
January 15, 1999 unless this date is extended by mutual consent
in writing of Buyer and Seller and may otherwise be terminated at
any time before the Closing as follows and in no other manner:
(a) Mutual Consent. By mutual consent in writing of
Buyer and Seller.
(b) Conditions to Buyer's Performance Not Met. By
Buyer upon written notice to Seller if any event
occurs which would render impossible the
satisfaction of one or more conditions to the
obligations of Buyer to consummate the
transactions contemplated by this Agreement as set
forth in Section 8.1 or 8.2.
(c) Conditions to Seller's Performance Not Met. By
Seller upon written notice to Buyer if any event
occurs which would render impossible the
satisfaction of one or more conditions to the
obligation of Seller to consummate the
transactions contemplated by this Agreement as set
forth in Section 8.1 or 8.3.
(d) Inaccurate Information. By Buyer if any material
information (whether or not in writing) delivered
by or on behalf of Seller to Buyer is inaccurate
or incomplete in any material respect.
(e) Certain Conditions. By Seller if the Closing has
not occurred by that date which is five (5)
business days after the date of receipt by Buyer
of the Financing by Buyer as contemplated by
Section 6.12 and the Nasdaq listing contemplated
by Section 8.2(n), provided Seller has performed
all obligations of Seller and has delivered the
documents to be delivered by or on behalf of
Seller under Section 8.2.
(f) Material Breach. By Seller or Buyer if there has
been a material misrepresentation or material
breach on the part of Buyer (in the case of a
termination by Seller) or Seller (in the case of a
termination by Buyer) in its representations,
warranties or covenants set forth herein;
provided, however, that if such breach or
misrepresentation is susceptible to cure, Seller
or Buyer, as the case may be, shall have 10
business days after receipt of notice from the
other party of its intention to terminate this
Agreement pursuant to this Section 9.1(f) if such
misrepresentation or breach continues in which to
cure such breach or misrepresentation before the
other party may so terminate this Agreement.
(g) Pursuit of Other Offers. By Buyer, if Seller
solicits, encourages, initiates or negotiates any
other sale or combination of Seller's businesses
or of the Business or any substantial part
thereof.
(h) Destruction or Condemnation. By Buyer, if any of
the Purchased Assets are damaged, destroyed or
taken, and if such damage, destruction or
condemnation is not "Non-Material" as such term is
described in Section 6.11.
(i) Diligence Investigation. By Buyer upon delivery
of written notice of termination to Seller (A) no
later than 10 business days after the delivery by
Seller of the last of the documents requested
prior to the date hereof by Buyer to complete its
diligence, or (B) if Buyer in the reasonable
exercise of its judgment in the course of its
ongoing business investigation of Seller shall
determine after reviewing information, projections
and assumptions developed by Seller and their
representatives and delivered to Buyer that such
information, projections and assumptions are not
commercially reasonable in light of current
business conditions or otherwise are likely to be
so materially inaccurate that Buyer does not have
reasonable assurance that such projections are in
a range in which it is probable that such
projections will be met."
2. No Other Changes. Except as modified by the provisions of
this Amendment, the Asset Purchase Agreement shall remain
unchanged and in full force and effect.
3. Counterparts. This Amendment may be executed in one or more
counterparts, all of which shall be considered one and the same
agreement, and shall become effective when one or more
counterparts have been signed by each of the Parties and
delivered to the other Party. Any actions previously taken on
behalf of the Parties by their respective officers consistent
with the terms of the Asset Purchase Agreement as amended by this
Amendment are hereby ratified, confirmed and approved as the
proper and valid actions of the applicable Party.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
IN WITNESS WHEREOF, each of the Parties hereto has
caused this Amendment to be duly executed as of the date first
above written.
"Seller"
▇▇▇ ▇▇▇▇▇'▇ MAGNAVOX CITY, INC.,
a California corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
"Buyer"
IMAGE NEWCO, INC.,
a California corporation
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: President
The undersigned, on its own behalf and as sole
shareholder of the Seller, hereby confirms its approval of the
foregoing Amendment.
APPROVED:
CRANE FAMILY TRUST,
established December 22, 1984
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Trustee