AGREEMENT
THIS AGREEMENT ("Agreement"), dated as of March 15, 2005 ("Effective
Date") by and among SPARKS EXHIBITS & ENVIRONMENTS CORP., a Pennsylvania
corporation located at 0000 Xxxxxxx Xxxx, Xxxxxxxxxxxx, XX 00000 ("Sparks"),
ARGOSY INVESTMENT PARTNERS II, L.P., a Pennsylvania limited partnership located
at 000 Xxxx Xxxxxx Xxxx, Xxxxx 0000, Xxxxx, XX 00000 ("Argosy"), and ALLIANCE
MEZZANINE INVESTORS, L.P., a New Jersey limited partnership located at 00
Xxxxxxx Xxxxxx, Xxxxxx, XX 00000 ("Alliance"). Argosy and Alliance are
collectively referred to herein as the "Investors".
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
contained herein and other good and valuable consideration, intending to be
legally bound, the parties to this Agreement hereby agree as follows:
1. Sale. The Investors own the securities and instruments set forth on
Schedule A (collectively, the "Securities") issued by Showtime Enterprises, Inc.
and Showtime Enterprises West, Inc. (collectively, the "Companies") pursuant to
the agreements set forth on Schedule A and agreements and documents ancillary
thereto (collectively, the "Showtime Agreements"). Subject to the satisfaction
of the terms and conditions of this Agreement, the Investors hereby sell,
transfer all of its right, title and interest to and deliver, and Sparks hereby
purchases, the Securities and Showtime Agreements free and clear of any liens,
claims and encumbrances (the "Sale Transaction") for the consideration set forth
in Section 2 hereof.
2. Consideration. As consideration to the Investors for consummation of
the Sale Transaction, Sparks shall:
a. pay the Investors $387,500 in cash (64.286%% to Argosy and
35.714% to Alliance) on or before March 23, 2005;
b. deliver to the Investors its promissory notes ("Notes") in the
aggregate principal amount of $400,000 (64.286%% to Argosy and 35.714% to
Alliance) in substantially the form set forth in Exhibit A;
c. deliver to the Investors warrants ("Warrants") to acquire a total
of 600,000 shares (64.286%% to Argosy and 35.714% to Alliance) of Marlton
Technologies, Inc., trading as MTY on the American Stock Exchange ("Marlton")
Common Stock pursuant to a Warrant Agreement (the "Warrant Agreement"), in
substantially the form set forth in Exhibit B; and
d. deliver to the Investors the Royalty Agreement (the "Royalty
Agreement") in substantially the form set forth in Exhibit C.
3. Representations.
a. Each of the Investors hereby warrants and represents that (i) it
has not previously sold, pledged nor encumbered such party's Securities and
Showtime Agreements, (ii) it has the full power and authority to sell and
transfer the Securities and Showtime Agreements, (iii) the outstanding principal
balance on the Securities is $4,650,000 and (iv) upon satisfaction of the
conditions precedent, it shall transfer all of its right, title and interest to
the Securities and Showtime Agreements to Sparks, free and clear of any liens,
claims and encumbrances.
b. Each of the Investors hereby represents and warrants to Sparks
and Marlton that it is an "accredited investor" within the meaning of Rule
501(a) of the Securities Act (as such term is defined in the Warrant Agreement)
and is acquiring the Warrants for investment for its own account, with no
present intention of dividing or participating its participation with others
(except as contemplated herein and except for assignments by an Investor to its
limited partners that are "accredited investors") or reselling or otherwise
distributing the same in violation of the Securities Act or any applicable state
securities laws.
4. Miscellaneous.
4.1 Events of Default. The occurrence of the following shall
constitute an Event of Default hereunder: default in payment by Sparks as and
when due under Section 2a hereof.
4.2 Notices. All notices, requests, demands, consents or other
communications required or permitted to be given under this Agreement shall be
in writing and shall be deemed to have been duly given if and when (i) delivered
personally, (ii) mailed by first class certified mail, return receipt requested,
postage prepaid, or (iii) sent by a nationally recognized overnight courier
service, postage or delivery charges prepaid, to the parties at their respective
addresses set forth on the first page of this Agreement or to such other
addresses of which the parties may give notice in accordance with this Section
4.1.
4.3 Entire Understanding; Modification. This Agreement sets forth
the understanding between the parties with respect to the subject matter hereof
and supersedes all prior and contemporaneous, written, oral, expressed or
implied, communications, agreements and understandings with respect to the
subject matter hereof. This Agreement shall not be amended, modified,
supplemented or terminated except in writing signed by both parties.
4.4 Parties in Interest. This Agreement shall inure to the benefit
of, bind and be enforceable by Sparks and the Investors. This Agreement shall
not be assignable or delegable by any party, provided Sparks may assign its
rights and duties hereunder without the Investors' consent to a successor in the
event of a sale, merger, consolidation or similar transaction of Sparks or its
parent entities. This agreement shall inure to the benefit of the successors and
permitted assigns of Sparks.
4.5 Severability. If any provision of this Agreement is construed to
be invalid, illegal or unenforceable, then the remaining provisions hereof shall
not be affected thereby and shall be enforceable without regard thereto.
4.6 Counterparts. This Agreement may be fully executed in any number
of counterparts, each of which when so executed and delivered shall be an
original hereof, and it shall not be necessary in making proof of this Agreement
to produce or account for more than one counterpart hereof.
4.7 Section Headings; References. Section and subsection headings in
this Agreement are inserted for convenience of reference only, and shall neither
constitute a part of this Agreement nor affect its construction, interpretation,
meaning or effect. All words used in this Agreement shall be construed to be of
such number and gender as the context requires or permits.
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4.8 Waivers. Neither the failure nor delay on the part of either
party to exercise any right, remedy, power or privilege under this Agreement
shall operate as a waiver thereof, nor shall the single or partial exercise of
any right, remedy, power or privilege preclude any other or further exercise of
the same or any other right, remedy, power or privilege, nor shall any waiver of
any right, remedy, power or privilege with respect to any occurrence be
construed as a waiver of such right, remedy, power or privilege with respect to
any other occurrence. No waiver shall be effective unless it is in writing and
is signed by the party asserted to have granted such waiver.
4.9 Controlling Law. This agreement is made under, and shall be
governed by, construed and enforced in accordance with, the substantive laws of
the Commonwealth of Pennsylvania applicable to agreements made and to be
performed entirely therein without giving effect to principles of conflicts of
laws.
4.10 EXCLUSIVE JURISDICTION. IN ANY ACTION OR PROCEEDING BETWEEN THE
PARTIES HERETO, THE PARTIES IRREVOCABLY CONSENT AND AGREE TO THE EXCLUSIVE
JURISDICTION OF THE FEDERAL AND STATE COURTS LOCATED IN PENNSYLVANIA; AND
SERVICE OF PROCESS BY HAND DELIVERY OR BY CERTIFIED MAIL, TO THE ADDRESSES SET
FORTH ABOVE FOR EACH PARTY.
4.11 Survival. The provisions of this Agreement shall survive and
continue in full force in accordance with their terms, notwithstanding
completion of the Sale Transaction hereunder.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the date above written.
Sparks Exhibits & Environments Corp.
By:
----------------------------------------
Argosy Investment Partners II, L.P.
By: Argosy Associates II, L.P., its general
partner
By: Argosy Associates II, Inc., its
general partner
By:
--------------------------------
Name: Xxxx Xxxxxxxx
Title: Vice President
Alliance Mezzanine Investors, L.P.
By: AMI Advisors, LLC, its general partner
By:
--------------------------------
Name: Xxxxx X. Xxxxxx
Title: Director
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SCHEDULE A
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Securities Outstanding Balance Agreements
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12.5% Senior Subordinated Securities Purchase
Debentures Agreement
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$1,607,000 Argosy $1,607,000 Argosy dated December 31, 2002
----------------------------------------------------------------------------------------------------------
$893,000 Alliance $893,000 Alliance
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Warrants
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Series A 87.7 shares
Argosy
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Series A 48.7 shares
Alliance
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Series B 44.0 shares
Argosy
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Series B 24.4 shares
Alliance
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Series C 49.6 shares
Argosy
----------------------------------------------------------------------------------------------------------
Series C 27.6 shares
Alliance
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12.5% Senior Subordinated First Amendment to
Debentures Securities
----------------------------------------------------------------------------------------------------------
$643,000 Argosy $643,000 Argosy Purchase Agreement dated
----------------------------------------------------------------------------------------------------------
$357,000 Alliance $357,000 Alliance September 11, 2003
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Warrants - Series D
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55.23 shares Argosy
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30.67 shares Alliance
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13.5% Senior Subordinated Second Amendment to
Debentures Securities
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$417,950 Argosy $417,950 Argosy Purchase Agreement dated
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$232,050 Alliance $232,050 Alliance February 4, 2004
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Warrants
Series E + Series F
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75.39 + 152.31 Argosy
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41.86 + 84.57 Alliance
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13.5% Senior Subordinated Third Amendment to
Debentures Securities
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$321,500 Argosy $321,500 Argosy Purchase Agreement dated
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$178,500 Alliance $178,500 Alliance August 23, 2004
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