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Exhibit 1
TERMINATION AGREEMENT
This Termination Agreement, dated as of the 19th day of May, 1998,
("Agreement"), by and between American Greetings Corporation, an Ohio
corporation ("AG") and Artistic Greetings Incorporated, a Delaware corporation
("AGI").
WHEREAS, AG and AGI are parties to that certain Stock Purchase
Agreement dated May 15, 1990 ("Stock Purchase Agreement"); and
WHEREAS, in connection with the execution of the Stock Purchase
Agreement, the parties executed the following agreements: a Standstill Agreement
dated May 15, 1990, superseded by a Standstill Agreement dated as of June 1,
1992 ("Standstill Agreement"); a Supplemental Agreement, supplementing the
Standstill Agreement, effective of even date therewith ("Supplemental
Agreement"); a Direct Mail Agreement dated as of June 1,1992 ("Direct Mail
Agreement"); a vendor Agreement, contemplated by the Direct Mail Agreement,
dated of even date therewith ("Vendor Agreement"); and two Trademark License
Agreements dated May 15, 1990 and January 31, 1991, respectively ("License
Agreements") (all of the foregoing are collectively hereafter referred to as the
"Agreements");
NOW, THEREFORE, in consideration of the premises and the mutual and
dependent promises hereinafter contained and subject to the conditions contained
herein, and intending to be legally bound hereby, the parties agree as follows:
1. AGREEMENTS.
1.1 TERMINATION OF THE AGREEMENTS. Upon the date of the
effectiveness of the merger (the "Termination Date") pursuant
to the Agreement and Plan of Merger by and among MDC
Communications Corporation, AGI Acquisition Co. and AGI, dated
as of December 21, 1997 (the "Merger Agreement") the
Standstill Agreement, the Supplemental Agreement, the Direct
Mail Agreement, the Vendor Agreement and the License
Agreements shall terminate and be of no further force and
effect and neither of the parties shall have any further
rights or obligations with respect thereto as of the
Termination Date; provided, however, that, for a period of two
(2) years from the Termination Date, Artistic Direct
Incorporated ("ADI") shall be entitled to use designs
previously obtained from AG in connection with the
distribution and sale of greeting cards pursuant to the
License Agreements.
1.2 RELEASE OF OBLIGATIONS UNDER THE AGREEMENTS. Upon the
Termination Date, each party, with the intention of binding
itself and its successors, assigns, agents, officers,
directors and employees ("Releasor") expressly and fully
releases, acquits and forever discharges the other and its
respective successors, assigns, agents, officers, directors
and employees ("Releasee") from and against any and all
claims, demands, actions, judgments, executions and causes of
action of whatsoever nature, whether known or unknown, that
Releasor ever had or now has or ever will have
against Releasee, connected with or arising out of, directly
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or indirectly, the Standstill Agreement, the Supplemental
Agreement, the Direct Mail Agreement, Vendor Agreement and
License Agreements; provided, however, that for a period of
two (2) years from the date of the Merger, ADI shall be
entitled to use designs previously obtained from AG pursuant
to the License Agreements in connection with the distribution
and sale of greeting cards.
2. REPRESENTATIONS AND WARRANTIES.
2.1 AGI. AGI represents and warrants as follows: the execution,
delivery and performance of this Agreement and the
transactions contemplated hereby have been duly authorized by
the Board of Directors of AGI, and all corporate actions of
AGI required to authorize such execution, delivery and
performance and such transactions, other than obtaining
shareholder approval, have been taken. This Agreement has been
duly and validly executed and delivered by AGI and constitutes
the valid and binding obligation of AGI, enforceable against
AGI according to its terms. No consent, authorization, or
approval of any third party, other than as set forth in the
preceding sentence, is required in connection with the
execution, delivery and performance of this Agreement by AGI.
2.2 AG. AG represents and warrants as follows: the execution,
delivery and performance of this Agreement and the
transactions contemplated hereby have been duly authorized by
the Board of Directors of AG, and all corporate actions of AG
required to authorize such execution, delivery and performance
and such transactions, other than obtaining shareholder
approval, have been taken. This Agreement has been duly and
validly executed and delivered by AG and constitutes the valid
and binding obligation of AG, enforceable against AG according
to its terms. No consent, authorization, or approval of any
third party, other than as set forth in the preceding
sentence, is required in connection with the execution,
delivery and performance of this Agreement by AG.
3.0 MISCELLANEOUS.
3.1 AMENDMENTS. No amendment to this Agreement shall be effective
unless in writing and signed by the parties.
3.2 ASSIGNMENT. Neither party shall assign this Agreement, in
whole or in part, without the prior written consent of the
other.
3.3 ENTIRE AGREEMENT. This Agreement contains the entire agreement
between the parties with respect to the subject matter hereof
and supersedes any and all prior oral or written agreements.
3.4 GOVERNING LAW. This Agreement shall be governed by and
interpreted in accordance with the internal substantive laws
of the State of New York.
3.5 DISPUTE RESOLUTION. The parties will attempt to settle all
disputes amicably within
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30 days of receipt of written notice of a dispute through
non-binding mediation. However, if they are unsuccessful, any
dispute arising out of or relating to this Agreement shall be
settled by binding arbitration in Cleveland under Ohio law if
AGI demands arbitration and in Elmira under New York law if AG
demands arbitration. Such arbitration shall be administered by
the American Arbitration Association under its Commercial
Arbitration Rules, and judgment on the award rendered by the
arbitrators may be entered in any court having jurisdiction
thereof.
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute this agreement as of the date set forth above.
ARTISTIC GREETINGS INCORPORATED
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title: Chief Operating Officer
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AMERICAN GREETINGS CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
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Title: President
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