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EXHIBIT 3.4
AGREEMENT
This Agreement (this "Agreement") is entered into as of July 2, 1996
by and between ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LITTLE and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, husband and wife,
residing at ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (together, the
"▇▇▇▇▇▇▇") and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, an individual residing at ▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
▇▇▇▇ ▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("▇▇▇▇▇▇▇").
WHEREAS, the ▇▇▇▇▇▇▇ own, as community property, 92.14672 shares (the
"Little Shares") of the outstanding common stock of Overseas Filmgroup, Inc., a
Delaware corporation (the "Company"), and ▇▇▇▇▇▇▇ owns 7.85328 shares of the
outstanding common stock of the Company (the "▇▇▇▇▇▇▇ Shares"); and
WHEREAS, the Little Shares and the ▇▇▇▇▇▇▇ Shares constitute all of
the issued and outstanding common stock of the Company; and
WHEREAS, pursuant to an Agreement of Merger dated as of July 2, 1996
(the "Merger Agreement") by and among Entertainment/Media Acquisition
Corporation ("EMAC"), the Company and the ▇▇▇▇▇▇▇, the parties thereto have
agreed that, subject to certain conditions, the Company shall be merged (the
"Merger") with and into EMAC, with EMAC being the surviving corporation (the
"Surviving Corporation") which will be renamed "Overseas Filmgroup, Inc." at
the effective time of the Merger; and
WHEREAS, pursuant to the Merger Agreement, the Little Shares shall be
converted into 2,928,218 shares of common stock of the Surviving Corporation,
$1,225,135 cash (subject to adjustment in certain circumstances) and a
promissory note in the principal amount of $2,000,000, and the ▇▇▇▇▇▇▇ Shares
will be converted into 249,560 shares of common stock of the Surviving
Corporation (the "Converted ▇▇▇▇▇▇▇ Shares") and $274,865 cash (subject to
adjustment in certain circumstances); and
WHEREAS, in light of the contemplated Merger, the ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇
seek to modify and/or affirm certain rights of first refusal and repurchase,
options to purchase and proxies with respect to the ▇▇▇▇▇▇▇ Shares and
Converted ▇▇▇▇▇▇▇ Shares, and otherwise provide for certain agreements with
respect to the Converted ▇▇▇▇▇▇▇ Shares.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ hereby
agree as follows:
1. General Agreement.
The parties hereto acknowledge and agree that (i) the Merger shall not
constitute an event permitting a right of first refusal or option to purchase
under that certain Stock Sale Agreement dated as of January 1, 1996 by and
between ▇▇▇▇▇▇▇ and the ▇▇▇▇▇▇▇ (the "Stock Agreement"), (ii) the Converted
▇▇▇▇▇▇▇ Shares shall constitute Collateral under that certain Security and
Stock Pledge Agreement dated as of January 1, 1996 by and between ▇▇▇▇▇▇▇ and
the ▇▇▇▇▇▇▇ (the "Pledge Agreement") and such Pledge Agreement shall continue
in full force and effect (with
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the terms and provisions of such Pledge Agreement independent of the terms of
this Agreement), (iii) the "S Election" as defined in the Stock Agreement shall
be terminated in connection with the Merger, (iv) ▇▇▇▇▇▇▇ and the Converted
▇▇▇▇▇▇▇ Shares shall be subject to the terms and conditions of this Agreement,
and (v) ▇▇▇▇▇▇▇ shall execute such additional instruments and documents and
take such other actions as from time to time requested by the ▇▇▇▇▇▇▇ to
confirm or effectuate the foregoing or the other purposes and provisions of
this Agreement. Until the Merger (and if the Merger does not occur) the
provisions of the Stock Agreement shall continue in full force and effect.
Upon consummation of the Merger, the Stock Agreement shall be superseded to the
extent set forth herein.
2. Transfer of Rights Hereunder.
The ▇▇▇▇▇▇▇ may at any time transfer and assign their rights
and delegate their obligations under this Agreement to any other person,
corporation, firm or entity, with or without consideration, provided such
transferee, assignee or delegee is an Affiliate of the ▇▇▇▇▇▇▇. No such
assignment shall relieve ▇▇▇▇▇▇▇ of his obligations hereunder. ▇▇▇▇▇▇▇ may not
assign any rights, or delegate any obligations or duties hereunder without the
prior written consent of the ▇▇▇▇▇▇▇. For purposes hereof, "Affiliate of the
▇▇▇▇▇▇▇" shall mean Persons controlling, controlled by or under common control
with any of the ▇▇▇▇▇▇▇ (including, without limitation, trusts or other
entities established by the ▇▇▇▇▇▇▇ for estate planning purposes) and "Person"
shall mean any natural person, corporation, partnership, limited liability
company, proprietorship, association, trust or other legal entity.
3. Irrevocable Proxy.
▇▇▇▇▇▇▇ hereby acknowledges and agrees that the irrevocable
proxy (the "Irrevocable Proxy") granted to the ▇▇▇▇▇▇▇ or their nominee
pursuant to the Stock Agreement shall remain in full force and effect following
the Merger with respect to the Converted ▇▇▇▇▇▇▇ Shares, that such proxy shall
remain irrevocable for the maximum period permitted by law, and that such
proxy shall terminate at the earlier of (a) such time as the ▇▇▇▇▇▇▇ (including
for this purpose, their Affiliates) beneficially own or control less than five
percent of the outstanding voting power of the Surviving Corporation, or (b)
the sale of such Converted ▇▇▇▇▇▇▇ Shares in the public market or pursuant to a
public offering (i.e. not a private sale or placement or involuntary transfer)
but only with respect to the shares so sold. Such proxy shall also remain
effective following the expiration of the proxy provisions of Paragraph 5.1 of
the Pledge Agreement. In the event that the Irrevocable Proxy is deemed for
any reason to be unenforceable as a result of the Merger or this Agreement,
then ▇▇▇▇▇▇▇ hereby grants to the ▇▇▇▇▇▇▇ an irrevocable proxy with respect to
the Converted ▇▇▇▇▇▇▇ Shares to take effect at the effective time of the Merger
and with terms equivalent to the Irrevocable Proxy as modified by this
Paragraph 3. Such proxy shall also be referred to for purposes of this
Agreement as an "Irrevocable Proxy." From time to time as requested by the
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ agrees to execute such additional instruments and documents
separate from this Agreement to acknowledge the grant of the Irrevocable Proxy
to the ▇▇▇▇▇▇▇ or their nominee and to confirm that the Irrevocable Proxy is
coupled with an interest sufficient in law to support an irrevocable power.
The provisions of this Paragraph are expressly made binding upon the heirs,
estates, beneficiaries, assigns, successors and representatives of ▇▇▇▇▇▇▇.
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4. Restriction on Transfer of Converted ▇▇▇▇▇▇▇ Shares; Right of
First Refusal.
a. Restriction on Transfer of Converted ▇▇▇▇▇▇▇ Shares.
(1) Restriction on Converted ▇▇▇▇▇▇▇ Shares.
None of the Converted ▇▇▇▇▇▇▇ Shares owned or held by ▇▇▇▇▇▇▇, nor any right or
interest in the Converted ▇▇▇▇▇▇▇ Shares, may be sold, assigned, transferred,
pledged, hypothecated, or in any other way disposed of or encumbered,
voluntarily or involuntarily, by operation of law, by gift or otherwise, except
in accordance with the terms of this Agreement.
(2) No Liens, Etc. Other than pursuant to the
Pledge Agreement or unless otherwise consented to in writing by the ▇▇▇▇▇▇▇, no
Converted ▇▇▇▇▇▇▇ Shares may be encumbered or subjected to a lien or security
interest of any kind by ▇▇▇▇▇▇▇ and any such encumbrance, lien or security
interest shall be null and void and of no force and effect,
b. Right of First Refusal
(1) Applicable Restrictions. After the Merger,
the provisions of Paragraph 4 and Paragraph 7 of the Stock Agreement shall no
longer apply and ▇▇▇▇▇▇▇'▇ rights and obligations with respect to sales and
transfers of Converted ▇▇▇▇▇▇▇ Shares shall be governed by this Paragraph 4 of
this Agreement.
(2) Right of First Refusal. If at any time after
the Merger, ▇▇▇▇▇▇▇ shall decide to sell or transfer any of the Converted
▇▇▇▇▇▇▇ Shares (and such sale or transfer is not prohibited by any federal or
state securities laws or any agreement to which ▇▇▇▇▇▇▇ is a party) ▇▇▇▇▇▇▇
shall give written notice to the ▇▇▇▇▇▇▇ of such intended sale or transfer
(including the number of Converted ▇▇▇▇▇▇▇ Shares which ▇▇▇▇▇▇▇ intends to sell
or transfer), and the ▇▇▇▇▇▇▇ shall have the right and option to purchase any
or all of the Converted ▇▇▇▇▇▇▇ Shares which ▇▇▇▇▇▇▇ has indicated in the
written notice that he intends to sell or transfer, at the price and upon the
terms hereafter provided in this Agreement. ▇▇▇▇▇▇▇ may not sell any Converted
▇▇▇▇▇▇▇ Shares if the sale or transfer thereof is prohibited by any federal or
state securities laws or any agreement to which ▇▇▇▇▇▇▇ is a party.
c. Other Events.
(1) Triggering Events. Upon the happening of any
of the following events ("Triggering Events") with respect to ▇▇▇▇▇▇▇ or with
respect to any of the Converted ▇▇▇▇▇▇▇ Shares held by ▇▇▇▇▇▇▇, the ▇▇▇▇▇▇▇
shall have the right and option to purchase any or all Converted ▇▇▇▇▇▇▇ Shares
of ▇▇▇▇▇▇▇ at the price and upon the terms hereafter provided in this
Agreement:
(a) Death of ▇▇▇▇▇▇▇. The death of
▇▇▇▇▇▇▇.
(b) Involuntary Transfers. Any purported
involuntary transfer, sale or other disposition of any Converted ▇▇▇▇▇▇▇
Shares, whether by operation of law, pursuant to court order, foreclosure of a
security interest, attachment, execution of a judgment or other
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legal process, or otherwise, and including but not limited to, a purported
transfer to a trustee in bankruptcy, receiver, or assignee for the benefit of
creditors.
(c) Bankruptcy. The entry of an order
for relief against ▇▇▇▇▇▇▇ under federal bankruptcy law or if ▇▇▇▇▇▇▇ (i) makes
a general assignment for the benefit of creditors, (ii) files a voluntary
petition under federal bankruptcy law, (iii) consents to the filing of an
involuntary petition in bankruptcy against ▇▇▇▇▇▇▇ or fails to obtain dismissal
of such bankruptcy proceeding against ▇▇▇▇▇▇▇ within sixty days following
commencement thereof, (iv) files a petition or answer seeking for ▇▇▇▇▇▇▇ any
reorganization, arrangement, composition, readjustment, liquidation,
dissolution or similar relief under any statute, law or regulation, or files an
answer or other pleading admitting or failing to contest the material
allegations of a petition filed against ▇▇▇▇▇▇▇ in any proceeding of this
nature, or (v) seeks, consents to, acquiesces in or otherwise suffers the
appointment of a trustee, receiver, or liquidator for ▇▇▇▇▇▇▇ or of all or any
part of ▇▇▇▇▇▇▇'▇ properties.
(d) ▇▇▇▇▇▇▇ ceases to be employed by the
Surviving Corporation at any time from and after the effective date of the
Merger by reason of termination by the Surviving Corporation for Employee's
Material Breach or for any other reason other than (i) "Death," (ii)
"Disability," or (iii) termination of employment by ▇▇▇▇▇▇▇ for "Company's
Material Breach." For purposes of this Paragraph 4.c.(1)(d), "Death,"
"Disability," "Employee's Material Breach," and "Company's Material Breach"
shall have the meanings given to such terms in the "▇▇▇▇▇▇▇ Employment
Agreement" (as such "▇▇▇▇▇▇▇ Employment Agreement" is defined in the Merger
Agreement).
(e) The Merger is not consummated by the
"drop dead" date set forth in the Merger Agreement.
(f) Other Transfers. The occurrence of
any other event which, were it not for the provisions of this Agreement, would
cause any Converted ▇▇▇▇▇▇▇ Shares or any part of ▇▇▇▇▇▇▇'▇ interest therein to
be sold, transferred or otherwise disposed of, voluntarily or involuntarily,
under circumstances that would not bring the transfer within any other
Paragraph of this Agreement which provides for a right of first refusal or
option to purchase in favor of the ▇▇▇▇▇▇▇.
(2) Marital Dissolution or Death of a Spouse.
(a) Marital Dissolution. Upon the
dissolution of the marital relationship of ▇▇▇▇▇▇▇ or execution of a binding
agreement or issuance of an order with respect to marital property of ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ and his spouse shall use their best efforts to cause the Converted
▇▇▇▇▇▇▇ Shares held by either of them, including the former spouse's interest
therein, if any (community or otherwise), to be distributed or transferred to
▇▇▇▇▇▇▇. If such distribution or transfer cannot be accomplished for any
reason, ▇▇▇▇▇▇▇ shall purchase the Converted ▇▇▇▇▇▇▇ Shares of his former
spouse and such former spouse shall sell the Converted ▇▇▇▇▇▇▇ Shares to
▇▇▇▇▇▇▇ on the same terms and at the same price as set forth in this Agreement
with respect to a sale by ▇▇▇▇▇▇▇ to the ▇▇▇▇▇▇▇. If such distribution or sale
does not occur for any reason whatsoever within 180 days after division of the
community, the ▇▇▇▇▇▇▇ shall have the right and
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option to purchase the remaining interest in the Converted ▇▇▇▇▇▇▇ Shares
retained by the former spouse at the same price and upon the same terms as
hereafter set forth in this Agreement with respect to a sale by ▇▇▇▇▇▇▇ to the
▇▇▇▇▇▇▇. ▇▇▇▇▇▇▇ shall promptly notify the ▇▇▇▇▇▇▇ in writing of any
dissolution of his marital relationship, any disposition of the Converted
▇▇▇▇▇▇▇ Shares by reason thereof and any property settlement proceedings which
provide the ▇▇▇▇▇▇▇ any purchase rights hereunder.
(b) Death of Spouse. Upon the death of a
spouse of ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ shall use his best efforts to cause the deceased
spouse's interest in the Converted ▇▇▇▇▇▇▇ Shares (community or otherwise), if
any, to be distributed or transferred to him. If the interest of the deceased
spouse is not held by ▇▇▇▇▇▇▇ directly or in trust whereby ▇▇▇▇▇▇▇ is the sole
trustee and has the sole beneficial interest in the trust, then ▇▇▇▇▇▇▇ shall
purchase the Converted ▇▇▇▇▇▇▇ Shares of his deceased spouse and the estate or
successor in interest of such deceased spouse's interest shall sell the
interest to ▇▇▇▇▇▇▇ on the same terms and at the same price as set forth in
this Agreement with respect to a sale by ▇▇▇▇▇▇▇ to the ▇▇▇▇▇▇▇. If such
disposition or sale does not occur for any reason whatsoever within 180 days
after the date of death, the ▇▇▇▇▇▇▇ shall have the right and option to
purchase the remaining interest in the Converted ▇▇▇▇▇▇▇ Shares of the deceased
spouse at the same price and upon the same terms as hereafter set forth in this
Agreement with respect to a sale by ▇▇▇▇▇▇▇ to the ▇▇▇▇▇▇▇. ▇▇▇▇▇▇▇ shall
promptly notify the ▇▇▇▇▇▇▇ in writing of the death of ▇▇▇▇▇▇▇'▇ spouse and the
disposition of any Converted ▇▇▇▇▇▇▇ Shares by reason thereof which provide the
▇▇▇▇▇▇▇ any purchase rights hereunder. If any Converted ▇▇▇▇▇▇▇ Shares are
held in a trust for the benefit of ▇▇▇▇▇▇▇ by virtue of the death of ▇▇▇▇▇▇▇'▇
spouse, upon the earlier of ▇▇▇▇▇▇▇'▇ death, ▇▇▇▇▇▇▇ ceasing to act as sole
trustee, or ▇▇▇▇▇▇▇ ceasing to have the sole beneficial interest in the trust,
then the ▇▇▇▇▇▇▇ shall have the right to purchase the Converted ▇▇▇▇▇▇▇ Shares
so held in trust upon the same terms and same conditions as set forth in this
Agreement with respect to a sale by ▇▇▇▇▇▇▇ to the ▇▇▇▇▇▇▇.
d. Terms of Right to Purchase.
(1) Period of Right to Purchase. Subject to the
other provisions of this Paragraph 4.d, upon the receipt by the ▇▇▇▇▇▇▇ of a
written notice pursuant to Paragraph 4.b or 4.c.(2) above, or upon receipt of
actual notice of any other Triggering Event set forth in Paragraph 4.c.(1)
above as determined in good faith by the ▇▇▇▇▇▇▇, the ▇▇▇▇▇▇▇ shall have the
right and option for a period ending 30 calendar days (90 calendar days in the
event of the Triggering Event set forth in paragraph 4.c.(1)(d) or (e), with
such 90 day period tolled in the case of the Triggering Event set forth in
Paragraph 4.c.(1)(d) during any period in which the ▇▇▇▇▇▇▇ may not freely
purchase the Converted ▇▇▇▇▇▇▇ Shares due to restrictions or limitations
imposed by any federal or state securities laws or regulations including,
without limitation, Section 16(b) of the Securities Exchange Act of 1934, as
amended) thereafter to purchase any or all of the Converted ▇▇▇▇▇▇▇ Shares that
▇▇▇▇▇▇▇ intends to sell or transfer in the case of Paragraph 4.b or available
for purchase in accordance herewith in other events, at the price and upon the
terms hereafter provided in this Agreement.
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(2) Termination of Rights.
(a) Voluntary Transfers. If the ▇▇▇▇▇▇▇
fail to exercise their option or purchase right within the applicable time
periods or if the ▇▇▇▇▇▇▇ do not purchase all of the Converted ▇▇▇▇▇▇▇ Shares
subject to the right of first refusal pursuant to Paragraph 4.b above, ▇▇▇▇▇▇▇
may sell or transfer on the open market such unpurchased portion of the
Converted ▇▇▇▇▇▇▇ Shares for which ▇▇▇▇▇▇▇ gave written notice of the intent to
sell or transfer. Concurrent with a sale of such Converted ▇▇▇▇▇▇▇ Shares on
the open market pursuant to the foregoing sentence, the Irrevocable Proxy
pertaining to such Converted ▇▇▇▇▇▇▇ Shares shall terminate and shall be of no
further force and effect. Any voluntary transfer permitted hereunder must be
effected within thirty calendar days after the date of the termination of the
purchase options provided herein to the ▇▇▇▇▇▇▇. If, at the expiration of such
thirty day period, any Converted ▇▇▇▇▇▇▇ Shares proposed to be sold or
transferred have not been sold or transferred, such Converted ▇▇▇▇▇▇▇ Shares
shall continue to be subject to all of the provisions of this Agreement, and
may not thereafter be sold or transferred except in the manner and upon the
terms herein provided.
(b) Other Events. In all other events,
the ▇▇▇▇▇▇▇ shall be entitled to purchase all or any portion of the Converted
▇▇▇▇▇▇▇ Shares available for purchase. Any transferee of such Converted
▇▇▇▇▇▇▇ Shares shall hold the Converted ▇▇▇▇▇▇▇ Shares subject to all of the
provisions of this Agreement including, without limitation, the Irrevocable
Proxy; provided, however, that in the case of a transfer pursuant to Paragraph
4(c)(1)(a) as a result of the death of ▇▇▇▇▇▇▇, the transferee shall hold the
Converted ▇▇▇▇▇▇▇ Shares subject to the Irrevocable Proxy (which shall expire
in accordance with the terms of this Agreement) but not subject in the case of
a subsequent transfer by such transferee to the rights of first refusal or
options to purchase set forth herein.
e. Purchase Price.
(1) Purchase Price. When any right of first
refusal or option to purchase Converted ▇▇▇▇▇▇▇ Shares arises under Paragraphs
4.b, 4.c or 4.d of this Agreement, the purchase price for such Shares shall be
the Market Price (i) with respect to Paragraph 4.b.(2), on the date of the
written notice specified therein (or, if such day is not a Trading Day (as
defined below), the immediately preceding Trading Day), (ii) with respect to
Paragraph 4.c.(1), on the date of the Triggering Event, (iii) with respect to
Paragraph 4.c.(2), on the date of the written notice specified therein (or, if
such day is not a Trading Day, the immediately preceding Trading Day);
provided, however, that in the event of a Triggering Event specified in
Paragraph 4.c.(1)(d) or (e) the purchase price for the Converted ▇▇▇▇▇▇▇
Shares shall be $2.00 per share as adjusted pursuant to Paragraph 5 hereof (the
"Repurchase Price"). The purchase price (or Repurchase Price) may be paid by
the ▇▇▇▇▇▇▇ by first applying the purchase price to the balance of that certain
Secured Recourse Promissory Note dated as of January 1, 1996 made by ▇▇▇▇▇▇▇ in
favor of the ▇▇▇▇▇▇▇ (the "Promissory Note").
(2) Determination of Market Price. "Market
Price" shall mean the reported last sale price per share of common stock
regular way or, in case no such sale takes place on such day, the average of
the reported closing bid and asked prices regular way, in each
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case on the New York Stock Exchange Composite Tape, or, if the shares of Common
Stock are not listed or admitted to trading on such exchange, on the American
Stock Exchange Composite Tape, or, if the shares of common stock are not listed
or admitted to trading on such exchange, the principal national securities
exchange (or the National Association of Securities Dealers Automated Quotation
System ("NASDAQ") National Market System) on which the shares of common stock
are listed or admitted to trading, or, if the shares of common stock are not
listed or admitted to trading on any national securities exchange (or on the
NASDAQ National Market System), the closing sales price, or, if there is no
closing sales price, the average of the closing bid and asked prices, in the
over-the-counter market as reported by NASDAQ or any comparable system, or, if
not so reported, the average of the closing bid and asked prices in the
domestic over-the-counter market as reported on the NASD Electronic Bulletin
Board, or, if not so reported, the average of the closing bid and asked prices
in the "pink sheets" published by the National Quotation Bureau, Incorporated
or any successor thereto, or, if not so reported, the average of the closing
bid and asked prices as furnished by any member of the National Association of
Securities Dealers, Inc. selected from time to time by the ▇▇▇▇▇▇▇ for that
purpose, or, if no such prices are furnished, the fair market value of a share
of Common Stock as estimated by a nationally recognized investment banking firm
selected by the ▇▇▇▇▇▇▇.
(3) Trading Day. For purposes hereof "Trading
Day" shall mean a day on which the principal national securities exchange on
which the shares of common stock are listed or admitted to trading is open for
the transaction of business, or, if the shares of common stock are not listed
or admitted to trading on any national securities exchange, a Monday, Tuesday,
Wednesday, Thursday or Friday on which prices in the over-the-counter market
are reported by NASDAQ.
f. Termination of Right of First Refusal. After a period
of five years from the effective date of the Merger, the ▇▇▇▇▇▇▇' rights of
first refusal and repurchase hereunder shall terminate, ▇▇▇▇▇▇▇ (or any
transferee who holds any Converted ▇▇▇▇▇▇▇ Shares subject to this Agreement)
shall be free to transfer such shares in the open market, and the Irrevocable
Proxy shall be of no further force and effect.
g. Consummation of Sale. Unless the parties involved
mutually agree otherwise, delivery to the ▇▇▇▇▇▇▇ of the share certificates
representing the Converted ▇▇▇▇▇▇▇ Shares to be sold pursuant to this Agreement
and payment of the purchase price therefor shall take place at a closing to be
held at the principal office of the Company at 10:00 a.m., Pacific Time,
within ten (10) calendar days following the termination of the applicable
option or right of first refusal period. At such closing (the "Closing"),
▇▇▇▇▇▇▇ or the ▇▇▇▇▇▇▇'▇ executor or administrator, or the transferee, as the
case may be, shall deliver to the ▇▇▇▇▇▇▇ all share certificates representing
the Converted ▇▇▇▇▇▇▇ Shares to be purchased by the ▇▇▇▇▇▇▇, and any other
documents requested by the ▇▇▇▇▇▇▇ to effectuate the purchase and the purposes
of this Agreement.
h. Transfer Rights Subject to Pledge Agreement. In
addition to the provisions of this Paragraph 4, all rights of ▇▇▇▇▇▇▇ to
transfer shares of Converted ▇▇▇▇▇▇▇ Shares shall also be subject to the
provisions of the Pledge Agreement and any and all restrictions on transfer
contained therein.
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5. Changes in Shares.
If, from time to time after the Merger, there is any stock
dividend, stock split, recapitalization, merger, consolidation or other similar
change in the character or amount of any of the outstanding securities of the
Surviving Corporation, then in such event any and all new, substituted or
additional securities issued with respect to the Converted ▇▇▇▇▇▇▇ Shares shall
be immediately subject to the terms of this Agreement (and the Irrevocable
Proxy) with the same force and effect as the Converted ▇▇▇▇▇▇▇ Shares presently
subject hereto. After each such event the Repurchase Price shall be
appropriately adjusted.
6. Legends.
The certificate or certificates representing the Converted
▇▇▇▇▇▇▇ Shares shall bear the legend referred to in the following paragraph in
addition to a legend stating that such shares are subject to the Irrevocable
Proxy, legends required by the Merger Agreement or the Lock-up and Registration
Rights Agreement (attached as Exhibit E to the Merger Agreement), and any
legends required by state or federal law:
"The Shares represented by this certificate are subject to
restrictions on transfer, including, without limitation,
rights of first refusal and rights of certain persons to
repurchase such Shares, as stated in that certain Agreement
dated as of July ____, 1996 between ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇ Little and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, a copy of which may be
inspected at the principal office of this Corporation and all
of the provisions of which are incorporated herein by this
reference."
The parties hereto agree that the Company shall remove the legend set forth
immediately above and the legend stating that the Converted ▇▇▇▇▇▇▇ Shares are
subject to the Irrevocable Proxy when the transfer restrictions, rights of
first refusal and repurchase, options to purchase and Irrevocable Proxy
contained or affirmed herein have terminated and such legends are no longer
required hereunder.
7. Rules of Construction and Enforcement; Miscellaneous.
This Agreement, all amendments hereto and the rights and
obligations of the parties hereunder shall be governed by, and construed in
accordance with, the laws of the State of California without regard to the law
of choice of law or conflicts of law of that or any other jurisdiction. This
Agreement shall be binding upon, and shall enure to the benefit of, the parties
hereto and their heirs, successors and assigns. Paragraph headings are for
convenience only and shall not be used in construing this Agreement. The
parties hereby consent to the exclusive jurisdiction of the State or Federal
Courts located in the State of California, County of Los Angeles for the
resolution of any disputes arising out of this Agreement. This Agreement may be
executed in counterparts, each of which will be an original but all of which,
taken together, will constitute one and the same instrument. This Agreement,
together with the Promissory Note and the Pledge Agreement, constitutes the
entire agreement and understanding of the parties and
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supersedes any and all prior or contemporary agreements and understandings
(whether oral or written, formal or informal) regarding the subject matter of
this Agreement; provided, however, that the Stock Agreement is superseded only
at such time and to such extent as set forth herein. No remedy conferred by
this Agreement, the Promissory Note or the Pledge Agreement is intended to be
exclusive and all rights and remedies are intended to be cumulative. In the
event of any litigation between the parties hereto to enforce any provision or
right hereunder, the unsuccessful party to such litigation shall pay to the
prevailing party therein all costs and expenses actually incurred therein,
including, but not limited to, reasonable attorneys' fees and court costs. A
copy of this Agreement shall be delivered to the Secretary of the Company and
to the Secretary of the Surviving Corporation.
8. Enforcement.
The transfer restrictions of this Agreement shall be deemed to
be of the essence of the ownership of the Converted ▇▇▇▇▇▇▇ Shares. The parties
hereto acknowledge and agree that irreparable damage would occur in the event
any of the provisions of this Agreement were not performed in accordance with
their specific terms or were otherwise breached and that such damage would not
be compensable in money damages and that it would be extremely difficult or
impracticable to measure the resultant damages. It is accordingly agreed that
the ▇▇▇▇▇▇▇ and/or the ▇▇▇▇▇▇▇ shall be entitled to an injunction or
injunctions to prevent breaches of the provisions of the Agreement (including,
without limitation, to prohibit a transfer or disposition of Converted ▇▇▇▇▇▇▇
Shares in violation of this Agreement) and to enforce specifically the terms
and provisions hereof (including, without limitation, the provisions of this
Agreement requiring ▇▇▇▇▇▇▇ to sell the Converted ▇▇▇▇▇▇▇ Shares or any part
thereof to the ▇▇▇▇▇▇▇) in addition to any other remedy to which they may be
entitled at law or equity, and such party that is sued for breach of this
Agreement expressly waives any defense that a remedy in damages would be
adequate and expressly waives any requirement in an action for specific
performance for the posting of a bond by the party bringing such action.
9. Severability.
If any term, provision or covenant in this Agreement is held
to be invalid, void or unenforceable, (i) the remainder of the terms,
provisions and covenants in this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and (ii) to
the fullest extent possible, the provisions of this Agreement (including,
without limitation, all portions of any section of this Agreement containing
any such provision held to be invalid, void or unenforceable that are not
themselves invalid, void or unenforceable) shall be construed so as to give
effect to the intent manifested by the provision held invalid, void or
unenforceable.
10. Notices.
Any notice that ▇▇▇▇▇▇▇ is required or may desire to give to the
▇▇▇▇▇▇▇ hereunder shall be in writing and may be served by delivering it to the
▇▇▇▇▇▇▇, or by sending it to the ▇▇▇▇▇▇▇ by certified mail, return receipt
requested (effective five days after mailing) or overnight delivery of the same
by delivery service capable of providing verified receipt (effective the next
business day), or facsimile (effective twenty-four hours after receipt is
confirmed by person or machine),
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at the address set forth below, or such substitute address as the ▇▇▇▇▇▇▇ may
from time to time designate by notice to ▇▇▇▇▇▇▇. Any notice that the ▇▇▇▇▇▇▇
are required or may desire to serve upon ▇▇▇▇▇▇▇ hereunder shall be in writing
and may be served by delivering it personally or by sending it certified mail,
return receipt requested, or overnight delivery, or facsimile (with receipt
confirmed by person or machine) to the address set forth below, or such other
substitute address as ▇▇▇▇▇▇▇ may from time to time designate by notice to the
▇▇▇▇▇▇▇. Such notices by the ▇▇▇▇▇▇▇ shall be effective at the same times as
specified in this Paragraph 10 for notices by ▇▇▇▇▇▇▇.
▇▇▇▇▇▇▇: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇: ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
IN WITNESS WHEREOF the parties have executed this Stock Sale Agreement
as of the date first above written.
Lischak: ▇▇▇▇▇▇▇:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LITTLE
------------------------------- -----------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Little
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
The undersigned acknowledges and understands the terms of this Agreement
and agrees to take such actions as may be necessary to effectuate the legend
requirement set forth in Paragraph 6 hereof.
Overseas Filmgroup, Inc., a
Delaware corporation
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LITTLE
--------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Little
Title: President
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