Exhibit 3.15
SHAREHOLDER RIGHTS AGREEMENT
----------------------------
This Agreement is dated as of 17 June, 1997 between Sky Games International Ltd.
("Sky Games"), a Bermuda exempted company, and ▇▇▇▇▇▇'▇ Interactive Investment
Company, a Nevada corporation ("HIIC").
WHEREAS:
A. Interactive Entertainment Limited ("IEL"), a Bermuda exempted company,
proposes to amalgamate with and into SGI Holding Corporation Limited
("SGIHC"), a Bermuda exempted company (the "Amalgamation"), pursuant to a
Plan and Agreement of Merger and Amalgamation dated 13 May, 1997 (the
"Amalgamation Agreement"), whereby each issued and outstanding share of
common stock, US$1.00 par value per share of IEL will be cancelled and, in
respect of such shares owned by HIIC, which will be converted into shares of
common stock of US$.01 par value each of the Sky Games;
B. SGIHC will amalgamate with and into Sky Games immediately after the
Amalgamation (the "Parent Amalgamation"; the company continuing therefrom is
hereafter referred to as the "Amalgamated Company").
NOW, THEREFORE, in consideration of the premises, representations, warranties
and agreements herein contained, the receipt and sufficiency of which are hereby
acknowledged, each party hereto agrees as follows:
2
I. TERMS
-----
Capitalised terms not defined herein shall have the same meanings ascribed to
them as set out in the Bye-laws of Sky Games as in effect upon the closing of
the Amalgamation (the "Bye-laws").
II. BOARD APPROVAL RIGHTS
---------------------
(A) As long as the HIIC Entities own 20% or more of the outstanding Voting
Shares of the Amalgamated Company on a "fully diluted basis" (as such term is
defined in the Bye-laws), none of the following actions shall be taken by the
Amalgamated Company unless the same shall first be approved by a Special Board
Majority:
(a) the sale of all or any material portion of the assets of the
Amalgamated Company together with any corporation, partnership, joint
venture or other legal entity of which the Amalgamated Company (either
alone or through or together with any other of its Subsidiaries),
owns, directly or indirectly, fifty percent (50%) or more of the
capital stock or other equity interest the holders of which are
generally entitled to vote with respect to the election of directors
or other managing authority and/or other matters to be voted on in
such corporation, partnership, joint venture or other legal entity
(each a "Subsidiary").
(b) the incurrence, renewal, refinancing, prepayment or amendment of the
terms of indebtedness of the Amalgamated Company together with its
Subsidiaries in excess of US$5 million in any one fiscal year;
(c) the Amalgamated Company or any of its Subsidiaries entering into any
material joint venture or partnership agreement which is beyond
activities on board commercial
3
aircraft through the use of in-flight entertainment hardware and
software installed or installable on aircraft seats and in aircraft
cabins;
(d) any material acquisition of assets by the Amalgamated Company or any
of its Subsidiaries, including by lease or otherwise (other than by
merger, consolidation or amalgamation) and other than pursuant to a
previously approved budget or plan, or the acquisition by the
Amalgamated Company or any of its Subsidiaries of the stock of another
entity, in each case involving an acquisition valued at US$5 million
or more;
(e) any material change in the nature of the business conducted by the
Amalgamated Company or any of its Subsidiaries;
(f) any material amendments to the MIP (as defined in the Amalgamation
Agreement) for 12 months following the closing of the Parent
Amalgamation;
(g) the adoption of any stock option plans for greater than 5% of the then
outstanding Common Shares of the Amalgamated Company on a
fully-diluted basis other than the MIP in any one fiscal year;
(h) material changes in accounting policies; and
(i) the creation or adoption of any shareholder rights plan.
4
(B) As long as the HIIC Entities own 10% or more of the outstanding Voting
Shares of the Amalgamated Company on a fully diluted basis, none of the
following actions shall be taken by the Amalgamated Company unless the same
shall first be approved by a Special Board Majority:
(a) any change in or conduct of the Amalgamated Company's or any of its
Subsidiaries' business or proposed business (including, but not limited to,
the terms of repurchase or redemption of any debt from any holder thereof
if such holder would be a Disqualified Holder (as defined in the Bye-laws)
if such Person held shares of the Amalgamated Company) that would
constitute or result in; or (b) any action or inaction of or by the
Amalgamated Company or any of its Subsidiaries
which HIIC or the Affiliates of HIIC determine in their reasonable business
judgement would result in, in the case of either (a) or (b), any actual or
threatened disciplinary action or any actual or threatened regulatory sanctions
with respect to or affecting the loss of, or the inability to obtain or failure
to secure the reinstatement of, any registration, certification, license or
other regulatory approval held by HIIC or the Affiliates of HIIC in any
jurisdiction in which HIIC or any of the Affiliates of HIIC are actively
conducting business or as to which any of them has received final approval or
authorisation or proceed, even on a preliminary basis, from its respective board
of directors (or any appropriate committee established by such board of
directors) of plans to conduct business (each such change, conduct, action or
inaction referred to herein as a "Disqualifying Action"); provided, the
reasonable business judgement to be exercised by HIIC and the Affiliates of HIIC
in determining whether a Disqualifying Action has occurred or would result need
not involve any consideration of the effect of the Disqualifying Action on the
Amalgamated Company alone or together with its Subsidiaries because the purpose
of the protections afforded by the determination of a Disqualifying Action is
for the benefit of the separate businesses and investments of HIIC and the
Affiliates of HIIC.
5
III. ENTIRE AGREEMENT; AMENDMENT
---------------------------
This Agreement constitutes the entire agreement between the parties in respect
of the subject matter hereof. No provision of this Agreement may be amended or
waived except by an instrument in writing executed by the parties.
IV. GOVERNING LAW
-------------
This Agreement shall be governed by and construed in accordance with the laws of
Bermuda, regardless of the laws that might otherwise govern under applicable
principles of conflict of laws of such country, and the parties hereby submit
expressly to the non-exclusive jurisdiction of the courts of Bermuda.
V. HEADINGS
--------
The headings appearing above certain paragraphs of this Agreement are for
convenience only and shall not affect the construction or interpretation hereof.
VI. ASSIGNMENT
----------
Neither this Agreement nor any of the rights, interests, or obligations
hereunder shall be assigned by operation of law or otherwise by any party hereto
without the prior written consent of the other party, and any purported
assignment without such consent shall be void; provided that HIIC may assign
this Agreement to any of its Affiliates without consent. Subject to the
foregoing sentence, this Agreement shall be binding upon and inure to the
benefit of the successors and assigns of the parties.
VII. SEVERABILITY
------------
If any term or provision of this Agreement is invalid, illegal or incapable of
being enforced by any rule of law, or public policy, all other terms, provisions
and conditions of this Agreement shall nevertheless
6
remain in full force and effect so long as the economic and legal substance of
the transactions contemplated hereby are not affected in any manner materially
adverse to any party hereto. Upon any determination that any term or other
provision hereof is invalid, illegal or incapable of being enforced, the parties
hereto shall negotiate in good faith to modify this Agreement so as to effect
the original intent of such parties as closely as possible in a mutually
acceptable manner in order that the transactions contemplated by this Agreement
may be consummated as originally contemplated to the fullest extent possible.
VIII. ENFORCEMENT OF THIS AGREEMENT
The parties hereto agree that irreparable damage would occur in the event that
any of the terms or provisions of this Agreement were not performed in
accordance with their specific wording or were otherwise breached. It is
accordingly agreed that each of the parties hereto shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions hereof in any court of Bermuda or the
United States of America or any state having jurisdiction, such remedy being in
addition to any other remedy to which any party may be entitled at law or in
equity. In any action to enforce its rights hereunder, the prevailing party
shall be entitled to recover its reasonable fees and expenses (including
reasonable attorney's fees and expenses) from the non-prevailing party.
IX. COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of which
shall be considered one and the same agreement.
SIGNED by )
for and on behalf of SKY GAMES ) /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
INTERNATIONAL LTD. in the )
presence of ) /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
SIGNED by )
for and on behalf of ▇▇▇▇▇▇'▇ ) /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
INTERACTIVE INVESTMENT COMPANY )
in the presence of ) /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇