AMCE RIGHT TO PURCHASE AGREEMENT
THIS RIGHT TO PURCHASE AGREEMENT (the "Agreement"), dated November __,
1997, is made and entered into among AMC ENTERTAINMENT INC., a Delaware
corporation (including its consolidated subsidiaries, hereinafter referred to as
"Grantor"), and ENTERTAINMENT PROPERTIES TRUST, a Maryland real estate
investment trust (hereinafter referred to as "Offeree"). Grantor and Offeree are
sometimes collectively referred to herein as the "Parties" and each of the
Parties is sometimes singularly referred to herein as a "Party".
WHEREAS, Grantor may in the future acquire or develop megaplex theatre
and related entertainment property owned (or ground-leased) by the Grantor (the
"Property");
WHEREAS, Grantor may from time to time sell, transfer, convey or
otherwise dispose of (which may include a leaseback, but not a mortgage)
("Transfer") any or all such Property during a period of five (5) years from
and including the date hereof (the "Right to Purchase Period"); and
WHEREAS, Grantor desires to grant to Offeree a personal non-assignable
right of first offer and right of first refusal relating to the Transfer of any
Property, exercisable under the terms and conditions hereinafter set forth.
NOW, THEREFORE, Grantor and Offeree hereby agree as follows:
1. RIGHT OF FIRST OFFER.
(a) GRANT OF RIGHT OF FIRST OFFER. Subject to the terms and
conditions set forth in this Agreement, Grantor hereby grants to Offeree a right
of first offer ("First Offer Right") relating to the Transfer of all or any
Property. If, at any time during the Right to Purchase Period, Grantor desires
to Transfer all or any portion of a Property (the "Offered Property"), Grantor
shall first deliver to Offeree written notice (the "Notice of Transfer"), which
Notice of Transfer shall state Grantor's desire to Transfer the Offered Property
and contain an accurate description of the Offered Property and its proposed
operations.
(b) ELECTION TO OFFER. (i) If Offeree elects to make an offer to
purchase the Offered Property, Offeree shall deliver to Grantor within sixty
(60) days following
the date the Notice of Transfer was received by Offeree (the "Offer Date") a
written offer (the "Offeree Offer"), which Offeree Offer shall offer to
purchase the Offered Property on the terms and conditions, including price,
timing and lease terms (if applicable), specified therein. The Offeree Offer
shall disclose all material facts relating to the proposed transaction and,
at Offeree's option, may include a form purchase agreement or lease, as
applicable. Each Offeree Offer shall be an irrevocable commitment by Offeree
to purchase the Offered Property on the terms and conditions set forth
therein.
(ii) If Offeree does not elect to make an offer to purchase the
Offered Property by the Offer Date or if Offeree makes an offer to purchase the
Offered Property by the Offer Date and Grantor elects not to Transfer the
Offered Property on the terms offered by Offeree, Grantor (A) shall be under no
obligation to Transfer any portion of the Offered Property to any person, unless
Grantor so elects, and (B) may, within a period of 6 months from and after the
Offer Date, solicit offers relating to the Transfer of such Offered Property;
provided, however, any Transfer of the Property within a period of 6 months from
and after the Offer Date not on terms and conditions and at a price more
favorable to those offered by Offeree shall be subject to the First Refusal
Right set forth in paragraph 2 of this Agreement. The First Offer Right granted
to Offeree under the terms and conditions of this Agreement shall revive in the
event that Grantor fails to Transfer the Offered Property within the six
(6) months from and after the Offer Date.
(iii) Notwithstanding Offeree's election not to make an offer to
purchase the Offered Property by the Offer Date or Grantor's election not to
Transfer the Offered Property on the terms offered by Offeree, Grantor shall be
obligated to submit a Grantor Offer to Offeree following receipt of a Bona Fide
Offer from a Proposed Transferee pursuant to paragraph 2 of this Agreement.
(c) ACCEPTANCE OF OFFEREE OFFER. If Grantor elects to Transfer the
Offered Property on the terms offered by the Offeree, Grantor shall deliver in
writing its election to Transfer the Offered Property to Offeree within thirty
(30) days following the date the Offeree Offer was received by Grantor. Such
communication shall, when taken in conjunction with the Offeree Offer, be deemed
to constitute a valid, legally binding and enforceable
agreement for the Transfer of the Property. Such agreement may be evidenced
by, but, unless otherwise agreed, shall not be subject to, execution of a
purchase agreement or lease, as applicable.
2. RIGHT OF FIRST REFUSAL.
(a) GRANT OF RIGHT OF FIRST REFUSAL. Subject to the terms and
conditions set forth in this Agreement, Grantor hereby grants to Offeree a
right of first refusal ("First Refusal Right") relating to the Transfer of
all or any Property. If, at any time during the Right to Purchase Period,
Grantor desires to Transfer any Offered Property pursuant to a bona fide
offer (the "Bona Fide Offer") from a third party (the "Proposed Transferee"),
Grantor shall first deliver to Offeree a written offer (the "Grantor Offer"),
which Grantor Offer shall offer to Transfer the Offered Property to the
Offeree on terms and conditions, including price, timing and lease terms (if
applicable), not less favorable to the Offeree than the terms and conditions
which Grantor proposes to Transfer such Property to the Proposed Transferee.
The Grantor Offer shall disclose the identity of the Proposed Transferee, the
person or persons, if any, that control such Proposed Transferee to the
extent known by Grantor, the terms and conditions, including price, timing and
lease terms (if applicable), of the proposed Transfer, any proposed form
purchase agreement or lease and any other material facts relating to the
proposed transaction. Each Grantor Offer is an irrevocable commitment by
Grantor to sell the Offered Property on the terms and conditions set forth
therein.
(b) CONFIRMATION OF BONA FIDE OFFER. The Offeree shall be permitted
to confirm that the Bona Fide Offer is firm and subject only to conditions that
could reasonably be expected to be satisfied, by (i) review of the documents
involved in such Bona Fide Offer and (ii) requiring that the Grantor cause the
Proposed Transferee to submit evidence reasonably satisfactory to the Offeree of
financing for such purchase, but only to the extent that the Bona Fide Offer has
a financing contingency. If review of such documents and of such evidence of
financing by the Offeree would violate a confidentiality obligation of Grantor
to the Proposed Transferee, or of the Proposed Transferee to any third party,
Grantor shall designate a recognized accounting or investment banking firm or
similar third party reasonably satisfactory to the Offeree, who shall at
Offeree's expense (i) certify that the terms set forth in
the written documents are as described in the Offer or are no more favorable
to the Proposed Transferee than the terms described in the Offer, and (ii)
certify that financing has been obtained, subject to no condition which, in
such third party's reasonable judgment, is likely to be unsatisfied, or based
on the evidence provided, such third party expects that financing for the
sale to the Proposed Transferee will be obtained.
(c) ACCEPTANCE OF GRANTOR OFFER. (i) If Offeree elects to purchase
the Offered Property on the terms set forth in the Grantor Offer, Offeree shall
deliver in writing its election to purchase the Offered Property to Grantor
within forty-five (45) days following the date the Grantor Offer was received by
the Offeree (the "Acceptance Date"), but not less than five days prior to the
expiration date of the Bona Fide Offer, provided such election in any
circumstance will not be due prior to the expiration of 10 business days
following the date the Grantor's Offer was received by Offeree. Such
communication shall, when taken in conjunction with the Grantor Offer, be deemed
to constitute a valid, legally binding and enforceable agreement for the
Transfer of the Property. Such agreement may be evidenced by, but, unless
otherwise agreed, shall not be subject to, execution of a purchase agreement or
lease, as applicable.
(ii) If Offeree does not elect to purchase the Offered Property by
the Acceptance Date, Grantor (i) shall be under no obligation to Transfer any
portion of the Offered Property to any person, unless Grantor so elects, and
(ii) may, within a period of 6 months from and after the date the Grantor
Offer was received by the Offeree, Transfer the Offered Property to any
person, including the Proposed Transferee, at a price at least equal to that
offered to Offeree in the Grantor Offer and on the terms and conditions
substantially consistent to those included in the Grantor Offer and Grantor
shall be under no obligation to submit a Grantor Offer to Transfer such
Offered Property to the Offeree in connection therewith. The First Refusal
Right granted to the Offeree under the terms and conditions of this Agreement
shall revive in the event that Grantor fails to Transfer the Offered Property
within the six (6) month period specified above.
3. DUE DILIGENCE. During the periods following the date the Notice of
Transfer was received by Offeree and prior to the Offer Date, following the date
the Grantor Offer was received by Offeree and prior to the Acceptance
Date and following any agreement to Transfer a Property, Grantor shall
provide Offeree access to the Offered Property, its books and records related
thereto and its officers and employees with knowledge thereof during
reasonable hours for purposes of conducting a due diligence investigation of
the Offered Property and its proposed operations.
4. CLOSING. (a) The closing of any Transfer of Offered Property pursuant
to this Agreement shall be determined by the Parties (which, unless otherwise
agreed, shall be within 90 days of the acceptance of any offer hereunder).
5. NO ASSIGNMENT. The First Refusal Right and First Offer Right
granted hereby are personal to Offeree, and, as an inducement to Grantor to
enter into this Agreement, it is expressly agreed that Offeree has no right,
directly or indirectly, to assign in whole or in part any rights granted by
this Agreement. Grantor shall have no obligation or requirement to deal with
any party other than Offeree in all matters relating to this Agreement. Any
purchase agreement or lease hereunder may be made with a subsidiary of
Grantor acceptable to Offeree. The First Refusal Right and First Offer Right
shall terminate if there is a Change of Control of Offeree as defined in
Annex I hereto.
6. NO BROKER. Offeree represents that it has dealt with no broker in
connection with the First Refusal Right and First Offer Right granted hereby,
and agrees to indemnify and hold Grantor harmless from the claims of any broker
in connection with the transactions contemplated hereby.
7. NOTICES. All notices, requests and other communications under this
Agreement shall be in writing and shall be either (a) delivered in person,
(b) sent by certified mail, return-receipt requested, (c) delivered by a
recognized delivery service or (d) sent by facsimile transmission and addressed
as follows:
If intended for Offeree: Entertainment Properties Trust
One Kansas City Place
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attention: Xxxxxx X. Xxxxxx,
President
With a copy to: Xxxxxxx, Mag & Fizzell, P.C.
0000 Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attention: Xxxxxxx X. X'Xxxxxxxx
If intended for Grantor: AMC Entertainment Inc.
000 Xxxx 00xx Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attention: Xxxxx X. Xxxxx,
President
With a copy to: Xxxxxxx & Xxxx X.X.
0000 Xxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attention: E.T. Xxxxxxx
or at such other address, and to the attention of such other person, as the
parties shall give notice as herein provided. A notice, request and other
communication shall be deemed to be duly received if delivered in person or
by a recognized delivery service, when delivered to the address of the
recipient, if sent by mail, on the date of receipt by the recipient as shown
on the return-receipt card, or if sent by facsimile, upon receipt by the
sender of an acknowledgment or transmission report generated by the machine
from which the facsimile was sent indicating that the facsimile was sent in
its entirety to the recipient's facsimile number; provided that if a notice,
request or other communication is
served by hand or is received by facsimile on a day which is not a Business
Day, or after 5:00 P.M. on any Business Day at the addressee's location, such
notice or communication shall be deemed to be duly received by the recipient
at 9:00 A.M. on the first Business Day thereafter.
8. WAIVER OF CONDITIONS. Any Party may at any time or times, at its
election, waive any of the conditions to its obligations hereunder, but any such
waiver shall be effective only if contained in a writing signed by such Party.
No waiver by a Party of any breach of this Agreement by the other Party shall be
deemed to be a waiver of any other breach by such other Party (whether preceding
or succeeding and whether or not of the same or similar nature), and no
acceptance of payment or performance by a Party after any breach by the other
Party shall be deemed to be a waiver of any breach of this Agreement by such
other Party, whether or not the first Party knows of such breach at the time it
accepts such payment or performance. No failure or delay by a Party to exercise
any right it may have by reason of the default of the other Party shall operate
as a waiver of default or modification of this Agreement or shall prevent the
exercise of any right by the first Party while the other Party continues to be
so in default.
9. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Missouri. The Parties agree that
jurisdiction and venue for any litigation arising out of this Agreement shall be
in the Courts of Xxxxxxx County, Missouri or the U.S. District Court for the
Western District of Missouri and, accordingly, consent thereto.
10. ATTORNEYS' FEES. If either Party obtains a judgment against the other
Party by reason of a breach of this Agreement, a reasonable attorneys' fee as
fixed by the court shall be included in such judgment.
11. REMEDIES CUMULATIVE. Except as herein expressly set forth, no remedy
conferred upon a Party by this Agreement is intended to be exclusive of any
other remedy herein or by law provided or permitted, but each shall be
cumulative and shall be in addition to every other remedy given herein or now or
hereafter existing at law, in equity or by statute.
12. SPECIFIC PERFORMANCE. The Parties agree that if any of the provisions
of this Agreement were not performed in accordance with their specific terms or
were otherwise breached, irreparable damage would occur, and no adequate remedy
at law would exist and damages would be difficult to determine, and that the
Parties shall be entitled to specific performance hereof (without requirement to
post bond), in addition to any and all other remedies at law or in equity. The
Parties agree that in connection with the enforcement of any agreement to
Transfer a Property created hereunder, the terms to be enforced shall be in the
following order of priority: (i) those terms contained in any executed purchase
agreement or lease; (ii) in the absence of (i), those contained in the
communications that constituted the agreement between the parties; and (iii) in
the absence of (i) or (ii), those contained in the Agreement of Sale and
Purchase, dated November __, 1997, among American Multi-Cinema, Inc., AMC
Realty, Inc. and Entertainment Properties Trust or the Lease, dated November __,
1997, between Entertainment Properties Trust and American Multi-Cinema, Inc., as
applicable.
13. COMPLETE AGREEMENT. This Agreement constitutes the entire
understanding between Grantor and Offeree with respect to the subject matter
hereof and no representations, warranties, promises, guarantees or agreements,
oral or written, express or implied, have been made by Grantor with respect to
this Agreement except as expressly provided in this Agreement. The Agreement
may not be modified, amended or waived except by a written instrument executed
by both Grantor and Offeree. A waiver on one occasion shall not be construed to
be a waiver with respect to any other occasion.
14. WAIVER OF JURY TRIAL. EACH PARTY HEREBY WAIVES TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY
ON ANY MATTER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS AGREEMENT OR THE
OTHER AGREEMENTS.
15. CAPTIONS. The captions in this Agreement are inserted for convenience
of reference only and in no way define, describe or limit the scope or intent of
this Agreement or any of the provisions hereof.
16. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which counterparts, when executed and delivered, shall be
deemed to be an original
and all of which counterparts, when taken together, shall constitute one and
the same Agreement.
IN WITNESS WHEREOF, Grantor and Offeree have executed this Agreement as of
the day and year first above written.
GRANTOR: OFFEREE:
AMC ENTERTAINMENT INC., ENTERTAINMENT PROPERTIES TRUST,
a Delaware corporation a Maryland real estate investment trust
By:_______________________________ By:__________________________________
Name: __________________________ Name: _____________________________
Title: __________________________ Title: _____________________________
ANNEX I
"Change in Control" shall mean the occurrence of any one of the
following events:
(i) individuals who, on the Effective Date, constitute the Board
of Trustees (the "Board") of Offeree (the "Incumbent Trustees") cease
for any reason to constitute at least a majority of the Board, provided
that any person becoming a trustee subsequent to November __, 1997,
whose election or nomination for election was approved by a vote of at
least two-thirds of the Incumbent Trustees then on the Board (either by
a specific vote or by approval of the proxy statement of the Offeree in
which such person is named as a nominee for trustee, without written
objection to such nomination) shall be an Incumbent Trustee; provided,
however, that no individual initially elected or nominated as a trustee
of the Offeree as a result of an actual or threatened election contest
with respect to trustees or as a result of any other actual or
threatened solicitation of proxies or consents by or on behalf of any
person other than the Board shall be deemed to be an Incumbent Trustee;
(ii) any "person" (as such term is defined in Section 3(a)(9) of
the Securities Exchange Act of 1934 (the "Exchange Act") and as used in
Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Offeree representing 25% or
more of the combined voting power of the Offeree's then outstanding
securities eligible to vote for the election of the Board (the "Offeree
Voting Securities"); provided, however, that the event described in this
paragraph (ii) shall not be deemed to be a Change in Control by virtue
of any of the following acquisitions: (A) by the Offeree or any
corporation or other entity in which the Offeree owns, directly or
indirectly, stock or other equity interests possessing 50% or more of
the total combined voting power of all classes of stock or other
interests in such corporation or other entity (a "Subsidiary"), (B) by
any employee benefit plan (or related trust) sponsored or maintained by
the Offeree or any Subsidiary, (C) by any underwriter temporarily
holding securities pursuant to an offering of such securities, or (D)
pursuant to a Non-Qualifying Transaction (as defined in paragraph (iii));
(iii) the shareholders of the Offeree approve a merger,
consolidation, statutory share exchange or similar form of corporate
transaction involving the Offeree or any of its Subsidiaries that
requires the approval of the Offeree's shareholders, whether for such
transaction or the issuance of securities in the transaction (a
"Business Combination"), unless immediately following such Business
Combination: (A) more than 50% of the total voting power of (x) the
corporation resulting from such Business Combination (the "Surviving
Corporation"), or (y) if applicable, the ultimate parent corporation
that directly or indirectly has beneficial ownership of 100% of the
voting securities eligible to elect directors of the Surviving
Corporation (the "Parent Corporation"), is represented by Offeree Voting
Securities that were outstanding immediately prior to such Business
Combination (or, if applicable, is represented by shares into which such
Offeree Voting Securities were converted pursuant to such Business
Combination), and such voting power among the holders thereof is in
substantially the same proportion as the voting power of such Offeree
Voting Securities among the holders thereof immediately prior to the
Business Combination, (B) no person (other than any employee benefit
plan (or related trust) sponsored or maintained by the Surviving
Corporation or the Parent Corporation or any person which beneficially
owned, immediately prior to such Business Combination, directly or
indirectly, 25% or more of the Offeree Voting Securities (an "Offeree
25% Shareholder")) would become the beneficial owner, directly or
indirectly, of 25% or more of the total voting power of the outstanding
voting securities eligible to elect directors of the Parent Corporation
(or, if there is no Parent Corporation, the Surviving Corporation) and
no Offeree 25% Shareholder would increase its percentage of such total
voting power and (C) at least a majority of the members of the board of
directors of the Parent corporation (or, if there is no Parent
Corporation, the Surviving Corporation) following the consummation of
the Business Combination were Incumbent Trustees at the time of the
Board's approval of the execution of the initial agreement providing for
such Business Combination (any Business Combination which satisfies all
of the criteria specified in (A), (B) and (C) above shall be deemed to
be a "Non-Qualifying Transaction"); or
(iv) the shareholders of the Offeree approve a plan of complete
liquidation or dissolution of the Offeree or a sale of all or
substantially all of the Offeree's assets.
Notwithstanding the foregoing, a Change in Control of the Offeree shall
not be deemed to occur solely because any person acquires beneficial
ownership of more than 25% of the Offeree Voting Securities as a result of
the acquisition of Offeree Voting Securities by the Offeree which reduces the
number of Offeree Voting Securities outstanding; provided, that if after such
acquisition by the Offeree such person becomes the beneficial owner of
additional Offeree Voting Securities that increases the percentage of
outstanding Offeree Voting Securities beneficially owned by such person, a
Change in Control of the Offeree shall then occur.
