EXHIBIT 10.3
AGREEMENT
This AGREEMENT ("Agreement"), made as of this 2nd day of July, 2001, by and
between WOW ENTERTAINMENT, INC., a Delaware corporation ("Entertainment"), Women
of Wrestling, Inc. ("WOW"), an Indiana corporation, and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (
"Fortune").
W I T N E S S E T H :
WHEREAS, Fortune owns 20,000 shares of Series A Preferred Stock, $100.00 par
value, in WOW, a wholly-owned subsidiary of Entertainment; and
WHEREAS, Fortune holds promissory notes and other indebtedness ("Debt") from WOW
in the total principal amount of Five Million Two Hundred and Fifty Thousand
Dollars, with accrued interest of One Hundred Eighteen Thousand Five Hundred and
Eighty Dollars and Thirty Five Cents ($118,580.35); and with accrued dividends
of Fifty Five Thousand Four Hundred and Two Dollars and Sixty Six Cents
($55,402.66);
WHEREAS, on June 28, 2001 Fortune agreed to exchange all of his WOW Series A
Preferred Stock and the Debt, for the Entertainment common shares as described
below; and
WHEREAS, the Board of Directors of Entertainment and WOW have approved and
adopted this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual agreements,
provisions and conditions contained herein, and for other good and valuable
consideration, the adequacy and receipt of which are hereby acknowledged, the
parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement, the following terms shall have the following
meanings, unless the context shall otherwise require:
(a) WOW Preferred Stock shall mean the 20,000 shares of Series A
Preferred Stock, $100.00 par value, of WOW owned by Fortune.
(b) Debt shall mean the WOW promissory notes and other indebtedness
held by Fortune in the total principal amount of Five Million Two
Hundred and Fifty Thousand Dollars ($5,250,000), with accrued
interest of One Hundred Eighteen Thousand Five Hundred and Eighty
Dollars and Thirty Five Cents ($118,580.35) and with accrued
dividends of Fifty Five Thousand Four Hundred and Two Dollars and
Sixty Six Cents ($55,402.66).
Fortune Agreement - Page 1
(c) Entertainment Common Stock shall mean the 16,250,000 shares of
Common Stock, $0.01 par value, of Entertainment, to be issued to
Fortune in accordance with this Agreement at the June 28, 2001
closing price of $0.20 per share.
(d) Closing shall mean the consummation of this Agreement in
accordance with the provisions hereof to be held on or before
July 2, 2001 unless changed by the mutual agreement of the
parties hereto.
ARTICLE II
EXCHANGE OF DEBT AND SECURITIES
At the Closing, the WOW Preferred Stock and the Debt shall be exchanged for the
Entertainment Common Stock. Upon the exchange, the WOW Preferred Stock and the
Debt shall no longer be outstanding and shall automatically be canceled and
retired and shall cease to exist. Fortune as holder of the certificate
previously evidencing the WOW Preferred Stock shall cease to have any rights
with respect to the WOW Preferred Stock. Fortune as holder of the Debt shall
cease to have any rights with respect to the Debt. Such certificate previously
evidencing the WOW Preferred Stock and the Debt shall be exchanged for a
certificate evidencing the Entertainment Common Stock.
The Entertainment Common Stock certificate shall bear the usual restrictive
legend pertaining to Rule 144 of the General Rules and Regulations promulgated
under the Securities Act of 1933. At the Closing, all transactions shall be
deemed to have been simultaneous and none shall become effective until all have
been completed.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF FORTUNE
The following representations and warranties are hereby made by Fortune to
Entertainment and WOW:
3.01 Authorization. Fortune has full power and authority to enter into this
Agreement and to carry out the transaction contemplated herein. This
Agreement constitutes the valid and legally binding obligation of
Fortune, enforceable in accordance with its terms and conditions.
3.02 Noncontravention. Neither the execution and the delivery of this
Agreement, nor the consummation of the transactions contemplated hereby
and thereby, will (a) violate any constitution, statute, regulation,
rule, injunction, judgment, order, decree, ruling, charge or other
restriction of any government, governmental entity, or court to which
Fortune is subject or (b) conflict with, result in a breach of,
constitute a default under, result in the acceleration of, create in
any party the right to accelerate, terminate, modify or cancel, or
require any notice under any agreement, contract, lease, license,
instrument or other arrangement to which Fortune is a party.
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3.03 Lack of Restrictions. Fortune holds of record and owns beneficially the
WOW Preferred Stock and the Debt, free and clear of any restrictions on
transfer (other than any restrictions under the Securities Act and
state securities laws) encumbrances, security interests, options,
warrants, purchase rights, contracts, commitments and/or equities.
Fortune is not a party to any option, warrant, purchase right or other
contract or commitment that could require Fortune to sell, transfer or
otherwise dispose of the WOW Preferred Stock or the Debt (other than
this Agreement).
3.04 Accredited Investor. Fortune is an "accredited investor" as that term
is defined in Regulation D of the Securities Act and has sufficient
knowledge and experience in financial and business matters that he is
capable of evaluating the merits and risks of the transaction
contemplated by this Agreement and making an informed business
decision.
3.05 Investment Intention. Fortune has no present intention to dispose of
any shares of Entertainment Common Stock, except for sales of shares
pursuant to Rule 144 promulgated under the Securities Act.
3.06 No Brokerage Fees. No agent, broker, investment banker, person or firm
acting on behalf of Fortune to the best of his knowledge, is or will be
entitled to any broker's or finder's fee or any other commission or
fee, directly or indirectly, in connection with any of the transactions
contemplated hereby.
3.07 Representations True. No representation or warranty contained herein,
nor any statement or certificate furnished hereunder or in connection
herewith, contains or will contain any untrue statement of a material
fact or omits or will omit to state a material fact necessary to make
the statements contained herein or therein not misleading.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF ENTERTAINMENT
The following representations and warranties are hereby made by Entertainment to
Fortune and WOW:
4.01 Organization; Authorization. Entertainment is a corporation duly
organized, validly existing and in good standing under the laws of its
state of incorporation and has full power and authority to enter into
this Agreement and to carry out the transaction contemplated herein.
This Agreement constitutes the valid and legally binding obligation of
Entertainment, enforceable in accordance with the terms and conditions.
4.02 Noncontravention. Neither the execution and the delivery of this
Agreement, nor the consummation of the transactions contemplated hereby
and thereby, will (a) violate any constitution, statute, regulation,
rule, injunction, judgment, order, decree, ruling, charge or other
restriction of any government, governmental entity, or court to which
Entertainment is subject or (b) conflict with, result in a breach of,
constitute a default under, result in the acceleration of, create in
any party the right to accelerate, terminate, modify or cancel, or
Fortune Agreement - Page 3
require any notice under any agreement, contract, lease, license,
instrument or other arrangement to which Entertainment is a party.
4.03 Capital Stock. Entertainment's authorized capital stock consists of
150,000,000 shares of Common Stock, $.01 par value, and 1,000,000
shares of Preferred Stock, $0.01 par value. Entertainment has full
right and authority to issue to Fortune, upon the terms and conditions
set forth in this Agreement, the shares specified by this Agreement
and, subject to the receipt of the consideration therefor pursuant to
the terms and conditions hereof, the shares will be duly and validly
issued as fully paid and nonassessable shares of Entertainment common
stock.
4.04 No Brokerage Fees. No agent, broker, investment banker, person or firm
acting on behalf of it to the best of its knowledge, is or will be
entitled to any broker's or finder's fee or any other commission or
fee, directly or indirectly, in connection with any of the transactions
contemplated hereby.
4.05 Representations True. No representation or warranty contained herein,
nor any statement or certificate furnished hereunder or in connection
herewith, contains or will contain any untrue statement of a material
fact or omits or will omit to state a material fact necessary to make
the statements contained herein or therein not misleading.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF WOW
The following representations and warranties are hereby made by WOW to Fortune
and Entertainment:
5.01 Organization; Authorization. WOW is a corporation duly organized,
validly existing and in good standing under the laws of its state of
incorporation and has full power and authority to enter into this
Agreement and to carry out the transaction contemplated herein. This
Agreement constitutes the valid and legally binding obligation of WOW,
enforceable in accordance with the terms and conditions.
5.02 Noncontravention. Neither the execution and the delivery of this
Agreement, nor the consummation of the transactions contemplated hereby
and thereby, will (a) violate any constitution, statute, regulation,
rule, injunction, judgment, order, decree, ruling, charge or other
restriction of any government, governmental entity, or court to which
WOW is subject or (b) conflict with, result in a breach of, constitute
a default under, result in the acceleration of, create in any party the
right to accelerate, terminate, modify or cancel, or require any notice
under any agreement, contract, lease, license, instrument or other
arrangement to which WOW is a party.
5.03 No Brokerage Fees. No agent, broker, investment banker, person or firm
acting on behalf of it to the best of its knowledge, is or will be
entitled to any broker's or finder's fee or any
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other commission or fee, directly or indirectly, in connection with
any of the transactions contemplated hereby.
5.04 Representations True. No representation or warranty contained herein,
nor any statement or certificate furnished hereunder or in connection
herewith, contains or will contain any untrue statement of a material
fact or omits or will omit to state a material fact necessary to make
the statements contained herein or therein not misleading.
ARTICLE VI
MISCELLANEOUS
6.01 Tax Consequences. Each party represents that it/he has consulted with
its/his own tax advisors and has made has made its/his own independent
conclusion regarding the tax consequences of the intended transaction.
6.02 Survival. All agreements, representations and warranties made hereunder
or in connection with the transactions contemplated hereby shall
survive the Closing and remain effective in accordance with the terms
hereof regardless of any investigation at any time made by or on behalf
of any of the parties.
6.03 Assignment. This Agreement may not be assigned nor any of the
performances hereunder delegated by operation of law or otherwise by
any party hereto, and any purported assignment or delegation shall be
void.
6.04 Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective heirs, successors,
legal representatives, assigns and transferors.
6.05 Entire Agreement. This Agreement constitutes the entire agreement of
the parties hereto with respect to the subject matter hereof. There are
no representations, warranties, conditions or other obligations except
as specifically provided. Any waiver, amendment or modification hereof
must be in writing. A waiver in one instance shall not be deemed to be
a continuing waiver or waiver in any other instance.
6.06 Arbitration. Any and all disputes, claims and controversies arising
under or by reason of this agreement shall be settled by arbitration in
accordance with the rules of the American Arbitration Association and
any award rendered in such arbitration shall be binding and conclusive
upon the parties. The arbitrators may decree specific performance or
grant injunctions or any other equitable relief deemed proper by the
arbitrators under the circumstances. Such arbitration shall be held in
Indianapolis, Indiana. Judgment on any award may be entered and
enforced in any court located in Indianapolis, Indiana.
6.07 Governing Law. This Agreement shall be construed and interpreted in
accordance with the laws of the State of Indiana.
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6.08 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. This
Agreement may be deemed executed upon receipt of a facsimile copy
bearing signatures of the parties, provided that a complete document
bearing original signatures is assembled within five business days of
such execution.
6.09 Effective Date. The Effective date of the Closing shall be July 2,
2001.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day
and year first above written.
WOW ENTERTAINMENT, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. May
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▇▇▇▇▇▇▇ ▇. May, CFO
WOMEN OF WRESTLING, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. May
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▇▇▇▇▇▇▇ ▇. May, CFO
/s/ Carter Fortune
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Carter Fortune, Individually
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