VOTING AGREEMENT
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VOTING AGREEMENT (the "Agreement"), dated as of July 20, 2005, by
and among Sheridan Square Entertainment, Inc., a Delaware corporation
("Sheridan"), Xxxxxx International Corp., a Delaware corporation ("Xxxxxx"), and
the individuals listed on Schedule A attached hereto (each a "Stockholder" and
collectively, the "Stockholders").
RECITALS
WHEREAS, Sheridan and Xxxxxx are parties to that certain
Agreement and Plan of Merger of even date herewith (the "Merger Agreement"),
pursuant to which SSE Acquisition Corp., a wholly-owned subsidiary of Xxxxxx,
shall merge with and into Sheridan, with Sheridan being the surviving
corporation and becoming a wholly-owned subsidiary of Xxxxxx (the "Merger
Transaction"); and
WHEREAS, as an inducement for Sheridan to enter into the
Merger Agreement, the Stockholders have agreed to vote their shares of Xxxxxx
stock in favor of the Merger Transaction;
WHEREAS, a condition precedent to the execution and delivery
of the Merger Agreement is the execution and delivery of this Agreement; and
WHEREAS, as of the date hereof, each Stockholder is the
registered owner of, or has the power to vote, the number of shares of common
stock of Xxxxxx ("Xxxxxx Stock") as indicated on Schedule A.
NOW, THEREFORE for valuable consideration, including the
execution and delivery of the Merger Agreement, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree as follows:
AGREEMENT
1. Voting of Shares.
a. Voting of Shares. At every meeting of the Stockholders of Xxxxxx called, and
at every adjournment thereof, and on every action or approval by written consent
of the Stockholders of Xxxxxx, each Stockholder shall vote (or cause to be
voted) the Shares (as defined in Section 1(b) below) owned by such Stockholder:
(i) in favor of the adoption of the Merger Agreement and all of the other
transactions contemplated by the Merger Agreement; (ii) against any proposal for
any merger, consolidation, sale of assets, recapitalization or other business
combination involving Xxxxxx (other than the Merger Transaction) or any other
action or agreement that would result in a breach of any covenant,
representation or warranty or any other obligation or agreement of Xxxxxx under
the Merger Agreement or which would result in any of the conditions to Hirsch's
obligations under the Merger Agreement not being fulfilled; and (iii) in favor
of any other matter relating to consummation of the transactions contemplated by
the Merger Agreement provided, however, that the agreements of any such
Stockholder described in (i) through (iii) above shall not apply where such
Stockholder is also a director of Xxxxxx and, Xxxxxx has received a Superior
Proposal (as such term is defined in Section 4.14(d) of the Merger Agreement).
b. "Shares" shall mean: (i) all securities of Xxxxxx (including all shares of
Xxxxxx Stock and all options, warrants and other rights to acquire Xxxxxx Stock)
owned by each Stockholder as of the date of this Agreement; and (ii) all
additional securities of Xxxxxx (including all shares of Xxxxxx Stock and all
additional options, warrants and other rights to acquire Xxxxxx Stock) of which
each Stockholder acquires ownership during the period from the date of this
Agreement through the termination of this Agreement. In the event of a stock
dividend or distribution, or any change in Xxxxxx Stock by reason of any stock
dividend or distribution, or any change in Xxxxxx Stock by reason of any
split-up, recapitalization, combination, exchange of shares or the like, the
term "Shares" shall be deemed to refer to and include the Shares as well as all
such stock dividends and distributions and any securities into which or for
which any or all of the Shares may be changed or exchanged or which are received
in such transaction.
c. Each Stockholder hereby gives any consents or waivers that are reasonably
required for the approval of the Merger Transaction under the terms of any
agreements to which the Stockholder is a party.
d. Nothing in this Agreement shall limit or restrict any Stockholder in acting
in his capacity as a director of Xxxxxx or any Subsidiary of Xxxxxx and
exercising his fiduciary responsibilities, it being understood that this
Agreement shall apply to each Stockholder solely in his capacity as a
stockholder of the Company, and shall not apply to such stockholders actions,
judgment or decisions as a director of Xxxxxx or any Subsidary of Xxxxxx.
e. Promptly following the execution of this Agreement, the
parties hereto shall use their reasonable efforts to cause Xxxx Xxxxxx, a
substantial shareholder of Xxxxxx, to execute and become a party to this
Agreement.
2. Restrictions on Transfer of Shares.
a. Prior to the consummation of the Merger Transaction, each Stockholder hereby
agrees not to take any of the following actions, except in accordance with
subsection (b) of this Section 2: (i) tender any of the Stockholder's Shares or
any securities convertible into or exchangeable or exercisable for the
Stockholder's Shares to any person; (ii) sell, transfer, distribute, pledge,
encumber, assign or otherwise dispose of (or enter into any transaction or
device that is designed to, or could reasonably be expected to, result in the
disposition by any person at any time in the future of) any of the Stockholder's
Shares or any securities convertible into, exchangeable or exercisable for the
Stockholder's Shares; (iii) enter into any swap or other derivatives transaction
that transfers to another, in whole or in part, any of the economic benefits or
risks of ownership of any of the Stockholder's Shares; (iv) enforce or permit
the execution of the provisions of any redemption, share purchase or sale,
recapitalization or other agreement with Xxxxxx (except pursuant to the Merger
Transaction), (v) deposit any of the Stockholder's Shares into a voting trust or
depositary facility or enter into a voting agreement or arrangement with respect
to any Shares or grant any proxy with respect thereto; or (vi) enter into any
contract, option or other arrangement or understanding with respect to or
consent to the offer for sale, sale, transfer, pledge, encumbrance, assignment
or other disposition of, any of its Shares, any securities convertible into,
exchangeable or exercisable for shares of Xxxxxx Stock or any other capital
stock of Xxxxxx or any interest in any of the foregoing with any person (any
transaction referred to in clause (i), (ii), (iii), (iv), (v) or (vi) is
hereinafter referred to as a "Transfer").
b. Notwithstanding subsection (a) above, each Stockholder may take an action
described in subsection (a) of this Section 2 if (i) Sheridan gives its prior
written consent to such action or (ii) the proposed transferee shall have
executed a counterpart of this Agreement and shall have agreed to hold such
Shares or interest in such Shares subject to all of the terms and provisions of
this Agreement.
c. No Stockholder shall request that Xxxxxx or its transfer agent register the
Transfer (book-entry or otherwise) of any certificate or uncertificated interest
representing any of such Stockholder's Shares, and each Stockholder hereby
consents to the entry of stop transfer instructions by Xxxxxx of any Transfer of
such Stockholder's Shares, unless such Transfer is made in compliance with this
Agreement.
x. Xxxxxx will not register the Transfer (book-entry or otherwise) of any
certificate or uncertified interest representing any of the Stockholder's Shares
and will enter a stop transfer instruction on any Transfer attempted in
violation of this Agreement.
3. Representations and Warranties; Additional Covenants of the Stockholders.
Each Stockholder hereby represents and warrants, severally and not jointly, and
covenants to Sheridan as follows:
a. Authorization. Stockholder has the power, corporate or otherwise, and
authority to enter into this Agreement and to carry out its obligations
hereunder. The execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby by each Stockholder have been duly and
validly authorized by such Stockholder and no other proceedings, corporate or
otherwise, on the part of the Stockholder is necessary to authorize the
execution and delivery of this Agreement or the performance by the Stockholder
of its obligations hereunder. This Agreement has been duly and validly executed
and delivered by the Stockholder and constitutes the legal, valid and binding
obligation of such Stockholder, enforceable against such Stockholder in
accordance with its terms.
b. No Conflict. The execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated hereby will not (i) conflict
with or result in any breach of any provision of the certificate of
incorporation, bylaws or similar organizational documents, if any, of each
Stockholder, (ii) result in a violation or breach of, or constitute (with or
without due notice or lapse of time or both) a default (or give rise to any
right of termination, amendment, cancellation or acceleration) under any of the
terms, conditions or provisions of any note, bond, mortgage, indenture, lease,
license, contract, agreement or other instrument or obligation to which such
Stockholder is a party or by which any of its properties or assets including the
Shares may be bound, or (iii) violate any order, writ, injunction, decree,
judgment, permit, license, ordinance, law, statute, rule or regulation
applicable to such Stockholder or any of its properties or assets, including the
Shares.
c. Title to Shares. Stockholder is the registered or beneficial owner of its
Shares free and clear of any lien or encumbrance, proxy or voting restriction
other than pursuant to this Agreement. Such Shares are all the securities of
Xxxxxx owned of record or beneficially by such Stockholder on the date of this
Agreement.
d. Accredited Investor. Stockholder is an "accredited investor" within the
meaning of the United States Securities and Exchange Commission ("SEC") Rule 501
of Regulation D, as presently in effect.
e. Reliance by Sheridan. Stockholder acknowledges that the execution and
delivery of this Agreement is a material and substantial inducement for Sheridan
to execute and deliver the Merger Agreement.
f. Certain Actions. Prior to the termination of this Agreement, each Stockholder
agrees not to, directly or indirectly, take any other action that would make any
representation or warranty of such Stockholder contained herein untrue or
incorrect.
g. Acknowledgment and Approval of the Merger Agreement. The Stockholder hereby
acknowledges and agrees that the Stockholder has received a copy of the Merger
Agreement and that the Stockholder has reviewed and understands the terms
thereof.
h. Ownership. Nothing contained in this Agreement shall be deemed to vest in
Sheridan any direct or indirect ownership or incidence of ownership of or with
respect to any of the Stockholder's Shares. Except as otherwise provided herein,
all rights, ownership and economic benefits of and relating to the Stockholder's
Shares shall remain and belong to the Stockholder, and Sheridan shall not have
any authority to manage, direct, superintend, restrict, regulate, govern, or
administer any of the policies or operations of Xxxxxx or exercise any power or
authority to direct such Stockholder in the voting of any of such Stockholder's
Shares, except as otherwise provided herein, or the performance of the
Stockholder's duties or responsibilities as a Stockholder of Xxxxxx.
i. No Solicitation. Stockholder will not, directly or indirectly, and will
instruct its agents, representatives, affiliates, employees, officers and
directors not to, directly or indirectly, solicit or initiate any proposal or
offer (including, without limitation, any proposal or offer to the Stockholders
of Xxxxxx) that constitutes, or may reasonably be expected to lead to, any
acquisition of Xxxxxx (an "Acquisition"). Stockholder shall notify Sheridan
immediately after receipt by such Stockholder or any of such Stockholder's
agents, representatives, affiliates, employees, officers and directors, of any
proposal for, or inquiry respecting, an Acquisition or any request for nonpublic
information in connection with such a proposal or inquiry, or for access to the
properties, books or records of Xxxxxx by any person or entity that informs or
has informed Xxxxxx or any Stockholder that it is considering making or has made
such a proposal or inquiry provided, that if Stockholder is a director or
officer of Xxxxxx, such disclosure does not, in the opinion of counsel to
Xxxxxx, violate any fiduciary duty or obligation which Stockholder, in his
capacity as a director or officer of Xxxxxx, may owe to Xxxxxx or the other
stockholders of Xxxxxx. Such notice to Sheridan shall indicate in reasonable
detail the identity of the person making the proposal or inquiry and the terms
and conditions of such proposal or inquiry. Stockholder immediately shall cease
and cause to be terminated all existing discussions or negotiations with any
parties conducted heretofore with respect to an Acquisition, except in respect
of the transactions contemplated by this Agreement, to the extent that such
Stockholder is also an officer or director of Xxxxxx.
4. General Provisions.
a. Notices. All notices and other communications given or made pursuant this
Agreement shall be in writing and shall be deemed given, (i) five business days
following sending by registered or certified mail, postage prepaid, (ii) when
sent if sent by facsimile; provided, however, that the facsimile is promptly
confirmed by telephone confirmation thereof, (iii) when delivered, if delivered
personally to the intended recipient, and (iv) one business day following
sending by overnight delivery via a national courier service, and in each case,
addressed to a party at the following address for such party (or at such other
addresses as shall be specified by notice given in accordance with this Section
4):
if to Xxxxxx: Xxxxxx International Corp.
000 Xxxxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxxxx
Facsimile No.: (000) 000-0000
with a copy to: Ruskin Xxxxxx Xxxxxxxxxx, X.X.
Xxxx Xxxxx, 00xx Xxxxx
000 XXX Xxxxx
Xxxxxxxxx, Xxx Xxxx 00000-0000
Attention: Xxxx Xxxxxxx, Esq.
Facsimile No.: (000) 000-0000
if to a Stockholder: then to the address listed opposite such
Stockholder's name on Schedule A attached hereto.
if to Sheridan: Sheridan Square Entertainment, Inc.
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxx
Facsimile No.: (000) 000-0000
with a copy to: Xxxxxx Xxxxxxxx Frome Xxxxxxxxxx & Xxxxxxx LLP
Park Avenue Tower
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxx, Esq.
Facsimile No.: (000) 000-0000
b. Descriptive Headings. The descriptive headings herein are inserted for
convenience of reference only and are not intended to be part of or to affect
the meaning or interpretation of this Agreement.
c. Severability. The provisions of this Agreement shall be deemed severable and
the invalidity or unenforceability of any provision shall not affect the
validity or enforceability of the other provisions hereof. If any provision of
this Agreement, or the application hereof to any person or any circumstance, is
invalid or unenforceable, (i) a suitable and equitable provision shall be
substituted therefor in order to carry out, so far as may be valid and
enforceable, the intent and purpose of such invalid or unenforceable provision
and (ii) the remainder of this Agreement and the application of such provision
to other persons or circumstances shall not be affected by such invalidity or
unenforceability, nor shall such invalidity or unenforceability affect the
validity or enforceability of such provision, or the application hereof, in any
other jurisdiction.
d. Entire Agreement; Amendment; Waiver. This Agreement constitutes the entire
agreement of the parties and supersede all prior agreements and undertakings,
both written and oral, between the parties, or any of them, with respect to the
subject matter hereof. This Agreement may not be amended or modified except in
an instrument in writing signed by, or on behalf of, the parties hereto. No
failure or delay by any party in exercising any right, power or privilege
hereunder shall operate as a waiver hereof, nor shall any single or partial
exercise hereof preclude any other or further exercise hereof or the exercise of
any other right, power or privilege.
e. Assignment. This Agreement and all of the provisions hereof shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns; provided, however, that neither this Agreement nor any
of the rights, interests or obligations of the parties hereto may be assigned by
any of the parties by operation of law or otherwise without the prior written
consent of the other parties.
f. Specific Performance. The parties agree that irreparable damage would occur
in the event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. It is
accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement, this being in addition to any other
remedy to which they are entitled at law or in equity.
g. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without giving effect to the
choice of law principles hereof.
h. Parties in Interest. This Agreement shall be binding upon and inure solely to
the benefit of each party hereto and its successors and permitted assigns, and
nothing in this Agreement, express or implied, is intended to or shall confer
upon any other person any rights, benefits or remedies of any nature whatsoever
under or by reason of this Agreement.
i. Submission to Jurisdiction; Waivers; Consent to Service of Process. Each of
the parties hereto irrevocably agrees that any legal action or proceeding with
respect to this Agreement or for recognition and enforcement of any judgment in
respect hereof brought by another party hereto or its successors or assigns
shall be brought and determined only in a United States or New York State Court
sitting in the counties of New York or Suffolk, State of New York. Each of the
parties hereby irrevocably submits with regard to any such action or proceeding
for itself and in respect to its property, generally and unconditionally, to the
personal jurisdiction of the aforesaid courts in the event that any dispute
arises out of this Agreement or any transaction contemplated hereby. Any service
of process to be made in such action or proceeding may be made by delivery of
process in accordance with the notice provisions contained in Section 4(a). Each
of the parties hereby irrevocably waives, and agrees not to assert, by way of
motion, as a defense, counterclaim or otherwise, in any action or proceeding
with respect to this Agreement, (i) any claim that it is not personally subject
to the jurisdiction of the above-named courts for any reason other than the
failure to serve process in accordance with this Section 4(i), (ii) that it or
its property is exempt or immune from jurisdiction of any such court or from any
legal process commenced in such courts (whether through service of notice,
attachment prior to judgment, attachment in aid of execution of judgment,
execution of judgment or otherwise), and (iii) to the fullest extent permitted
by applicable law that (A) the suit, action or proceeding in any such court is
brought in an inconvenient forum, (B) the venue of such suit, action or
proceeding is improper and (C) this Agreement, or the subject matter hereof, may
not be enforced in or by such courts.
j. Counterparts. This Agreement may be executed in one or more counterparts, all
of which shall be considered one and the same agreement and shall become
effective when one or more counterparts have been signed by each of the parties
and delivered to the other parties.
k. WAIVER OF JURY TRIAL. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY
THAT MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED ISSUES AND,
THEREFORE, SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT
THAT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND
ACKNOWLEDGES (i) THAT SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS
OF THIS WAIVER, (ii) THAT SUCH PARTY MAKES THIS WAIVER VOLUNTARILY AND (iii)
SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 4(k).
l. Termination. This Agreement and all obligations of the parties hereunder and
thereunder, shall terminate immediately, without any further action being
required, upon the earlier of (i) any termination of the Merger Agreement or
(ii) the consummation of the Merger Transaction.
m. Further Assurances. Each party to this Agreement agrees (i) to furnish upon
request to the other party such further information, (ii) to execute and deliver
to the other party such other documents and (iii) to do such other acts and
things as the other party reasonably requests for the purpose of carrying out
the intent of this Agreement and the documents and instruments referred to
herein.
n. Interpretation. The words "hereof," "herein," "herewith" and words of similar
import shall, unless otherwise stated, be construed to refer to this Agreement
as a whole and not to any particular provision of this Agreement. Section and
exhibit references are to the sections and exhibits of this Agreement unless
otherwise specified. Whenever the words "include," "includes," or "including"
are used in this Agreement, they shall be deemed to be followed by the words
"without limitation." All terms defined in this Agreement shall have the defined
meanings contained herein when used in any certificate or other document made or
delivered pursuant hereto unless otherwise defined therein. The definitions
contained in this Agreement are applicable to the singular as well as the plural
forms of such terms and to the masculine as well as to the feminine and neuter
genders of such terms. Any agreement, instrument, or statute defined or referred
to herein or in any agreement or instrument that is referred to herein means
such agreement, instrument, or statute as from time to time, amended, qualified
or supplemented, including (in the case of agreements and instruments) by waiver
or consent and (in the case of statutes) by succession of comparable successor
statutes and all attachments thereto and instruments incorporated therein.
References to a person are also to its permitted successors and assigns. The
parties have participated jointly in the negotiation and drafting of this
Agreement. In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by the parties
and no presumption or burden of proof shall arise favoring or disfavoring any
party by virtue of the authorship of any provisions of this Agreement.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
"Sheridan" "Xxxxxx"
Xxxxxxxx Square Entertainment, Inc. Xxxxxx International Corp.
By: /s/ Xxxxxx X. Xxxxxx By: /s/ Xxxx Xxxxxxxxx
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Name: Xxxxxx X. Xxxxxx Name: Xxxx Xxxxxxxxx
Title: Co-Chief Executive Officer Title: President and Cheif CEO
"STOCKHOLDERS"
By: /s/ Xxxx Xxxxxxxxx
-----------------------
Name: Xxxx Xxxxxxxxx
Title: President and Cheif CEO
By: /s/ Xxxxx Xxxxxxx
------------------------
Name: Xxxxx Xxxxxxx
Title: Chairman of the Board
[Signature Page to Voting Agreement]
SCHEDULE A
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STOCKHOLDERS
Name Address Number and Type of Shares
---- ------- -------------------------
Xxxxx Xxxxxxx c/x Xxxxxx International Corp. 981, 659 shares - Class A
Common Stock
200 Wireless Boulevard 400,018 shares - Class X
Xxxxxx Xxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Xxxx Xxxxxxxxx c/o Hirsch International Corp. 295,000 shares - Class A
Common Stock
000 Xxxxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
