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CONTRIBUTION AGREEMENT
by and among
HALLMARK ENTERTAINMENT INVESTMENTS CO.,
HALLMARK ENTERTAINMENT HOLDINGS, INC.
and
THE OTHER SIGNATORIES HERETO
dated as of
March 11, 2003
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TABLE OF CONTENTS
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Page
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ARTICLE I - DEFINITIONS...............................................................................................1
1.1 Definitions.........................................................................................1
ARTICLE II - THE CLOSING..............................................................................................4
2.1 The Closing.........................................................................................4
2.2 Related Documents...................................................................................4
ARTICLE III - THE EXCHANGES...........................................................................................4
3.1 The Exchanges.......................................................................................4
3.2 Delivery of Share Certificates......................................................................4
ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF HEH....................................................................4
4.1 Corporate Existence.................................................................................4
4.2 Power and Authority.................................................................................4
4.3 Enforceability, etc.................................................................................5
4.4 Capitalization......................................................................................5
4.5 Consents and Approvals..............................................................................6
4.6 No Liabilities......................................................................................6
4.7 Brokers, etc........................................................................................6
ARTICLE V - REPRESENTATIONS AND WARRANTIES OF THE MINORITY CONTRIBUTORS...............................................6
5.1 Existence; Power and Authority......................................................................6
5.2 Enforceability, etc.................................................................................7
5.3 Ownership...........................................................................................7
5.4 Consents and Approvals..............................................................................7
5.5 Purchase for Investment.............................................................................7
5.6 Financial Matters...................................................................................7
5.7 Brokers, etc........................................................................................8
ARTICLE VI - INDEMNIFICATION..........................................................................................8
6.1 Indemnification.....................................................................................8
6.2 Procedure for Indemnification.......................................................................8
6.3 Time Limitations on Indemnity.......................................................................9
6.4 Limitations on Indemnity............................................................................9
ARTICLE VII - GENERAL PROVISIONS; OTHER AGREEMENTS....................................................................9
7.1 Expenses............................................................................................9
7.2. Governing Law; Jurisdiction and Forum...............................................................9
7.3. Further Assurances..................................................................................9
7.5 Headings...........................................................................................10
7.6 Notices............................................................................................10
7.7 Parties in Interest................................................................................10
7.8 Entire Agreement...................................................................................10
7.9 Counterparts.......................................................................................10
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7.10 Amendment..........................................................................................10
7.11 Gender, etc........................................................................................10
7.12 Severability.......................................................................................10
7.13 No Waiver..........................................................................................11
Item 4.4 Company Capitalization Schedule
Item 4.4(a) Liens on Crown Stock
Item 5.1 Jurisdiction of Organization
Item 5.4 Minority Shareholder Required Consents
Appendix I Contributors and Contributions
Appendix II Notices
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This CONTRIBUTION AGREEMENT, dated as of March 11, 2003, (this
"Agreement"), by and among Hallmark Entertainment Investments Co., a Delaware
corporation (the "Company"), Hallmark Entertainment Holdings, Inc., a Delaware
corporation ("HEH"), and the other parties hereto (each such other party a
"Minority Contributor," together with HEH, the "Contributors").
WHEREAS, the Parties desire to consummate the transactions
contemplated herein, pursuant to which each Contributor will contribute to the
Company the number of shares of Class A common stock, par value $.01 per share
("Crown Class A Stock"), of Crown Media Holdings, Inc., a Delaware corporation
("Crown"), and, if any, the number of shares of Class B common stock, par
value $.01 per share (" Crown Class B Stock"), of Crown set forth across from
its name in Appendix I in exchange for the number of shares of Class A common
stock, par value $.01 per share ("Class A Stock"), of the Company and, if any,
Class B common stock, par value $.01 per share ("Class B Stock"), of the
Company set forth across from its name in Appendix I; and
WHEREAS, for Federal income tax purposes, it is intended that the
contributions will qualify as transfers to a controlled corporation under the
provisions of Section 351 of the Internal Revenue Code of 1986, as amended
(the "Code"), and the Treasury Regulations thereunder;
NOW, THEREFORE, in consideration of the premises and the
representations, warranties and agreements herein contained, the Parties agree
as follows:
ARTICLE I - DEFINITIONS
1.1 Definitions. As used herein, the following terms shall have the
following meanings:
"Actions" means all complaints, actions, suits, proceedings or
investigations.
"Adverse Consequences" means all claims, judgments, damages,
penalties, fines, costs, losses, liabilities or other monetary obligations
(including all reasonable attorney and expert fees incurred to enforce the
terms of this Agreement) net of any recovery from any third party including,
without limitation, insurance proceeds.
"Agreement" has the meaning set forth in the Preamble.
"Blue Sky Laws" has the meaning set forth in Section 4.4(a).
"Class A Stock" has the meaning set forth in the Recitals.
"Class B Stock" has the meaning set forth in the Recitals.
"Closing" has the meaning set forth in Section 2.1.
"Closing Date" has the meaning set forth in Section 2.1.
"Code" has the meaning set forth in the Recitals.
"Commission" means the Securities and Exchange Commission.
"Common Stock" means, collectively, the Class A Stock and the Class B
Stock.
"Company" has the meaning set forth in the Preamble.
"Company Capitalization Schedule" has the meaning set forth in
Section 4.4(a).
"Company Indemnified Persons" has the meaning set forth in Section
6.1(c).
"Company Stockholders Agreement" means the Stockholders Agreement to
be entered into by and among the Company and the Contributors substantially in
the form set forth in Exhibit B.
"Consent and Waiver" means a consent and waiver pursuant to the Crown
Stockholders Agreement with respect to this Agreement and the transactions
contemplated hereunder.
"Contributor" has the meaning set forth in the Preamble.
"Contributor Indemnified Persons" has the meaning set forth in
Section 6.1(a).
"Crown" has the meaning set forth in the Recitals.
"Crown Class A Stock" has the meaning set forth in the Recitals.
"Crown Class B Stock" has the meaning set forth in the Recitals.
"Crown Stockholders Agreement" means the Second Amended and Restated
Stockholders Agreement, dated as of August 30, 2001, by and among HEH (as
transferee of the shares of Crown Class A Stock and Crown Class B Stock held
by Hallmark Entertainment, Inc.), Liberty Media Corporation, Liberty Crown,
Inc., VISN Management Corp., XX Xxxxxx Partners (BHCA), L.P., DIRECTV
Enterprises, Inc. and Crown.
"Encumbrance" means any security interest, mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory
or otherwise), charge against or interest in property to secure payment of a
debt or performance of an obligation or other priority or preferential
arrangement of any kind or nature whatsoever, including the interest of a
vendor, lessor or licensor under any conditional sale, capitalized lease,
exclusive license or other title retention agreement.
"Governmental Entity" means any Federal, state or local government or
any court, administrative agency or commission or other governmental authority
or agency, domestic or foreign.
"HEH" has the meaning set forth in the Preamble.
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"Indemnified Party" has the meaning set forth in Section 6.2.
"Indemnifying Party" has the meaning set forth in Section 6.2.
"Interest" means any evidence of equity ownership of any Person,
whether represented by common stock, preferred stock, securities, options,
warrants or other rights to repurchase or acquire any equity ownership of such
Person (including convertible debentures, notes or other securities
convertible or exchangeable into or exercisable for the purchase or other
acquisition of capital stock), trust certificates, general or limited
partnership interests or any other type of capital stock or equity interest.
"Law" means any law, statute, regulation, rule, ordinance,
requirement or other binding action or requirement of any governmental,
regulatory or administrative body, agency or authority or any court of
judicial authority.
"Material Adverse Effect" means a material adverse effect on (i) with
respect to the Company or HEH, the business, results of operation or financial
condition of the Company and its Subsidiaries taken as a whole or HEH and its
Subsidiaries taken as a whole, as applicable; and (ii) with respect to any of
the Contributors, the legal ability of such Contributor to consummate the
transactions contemplated by this Agreement, other than by reason of the
inability of the other Contributors to consummate such transactions.
"Minority Contributor" has the meaning set forth in the Preamble.
"Order" means any decree, order, judgment, writ, award, injunction,
stipulation or consent of or by any governmental, regulatory or administrative
body, agency or authority or any court or judicial authority.
"Party" means any of the Company or any of the Contributors.
"Person" means any individual, corporation, general or limited
partnership, joint venture, association, limited liability company, joint
stock company, trust, business trust, bank, trust company, estate (including
any beneficiaries thereof), unincorporated entity, cooperative, association,
government branch, agency or political subdivision thereof or organization of
any kind.
"Related Documents" means the Company Stockholders Agreement.
"Securities Act" means the Securities Act of 1933, as amended, and
the rules and regulations issued in respect thereto.
"Subsidiary" of any Person means any corporation or other entity of
which securities or other ownership interests having voting power to elect a
majority of the Board of Directors or other Persons performing similar
functions are at the time directly or indirectly owned or controlled by such
Person or one or more Subsidiaries of such Person.
"Written Notice" has the meaning set forth in Section 6.2.
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ARTICLE II - THE CLOSING
2.1 The Closing. The closing of the transactions contemplated herein
(the "Closing") shall take place at the offices of the Company, Kansas City,
Missouri, on the date of this Agreement (the "Closing Date").
2.2 Related Documents. Simultaneously, at the Closing, a Consent and
Waiver is being executed and delivered by DIRECTV Enterprises, Inc., and the
Company Stockholders Agreement is being executed and delivered by the Company,
HEH and the other signatories thereto.
ARTICLE III - THE EXCHANGES
3.1 The Exchanges. At the Closing, each of the Contributors shall
contribute to the Company the number of shares of Crown Class A Stock and, if
any, the number of shares of Crown Class B Stock set forth opposite its name
on Appendix I hereto, and the Company shall issue to such Stockholder the
number of shares of Class A Stock and, if any, Class B Stock set forth
opposite its name on Appendix I hereto.
3.2 Delivery of Share Certificates. At the Closing, each of the
Contributors will deliver to the Company share certificates or other
documents, which certificates or other documents shall be either duly endorsed
in blank or accompanied by stock powers duly executed in blank, representing
its respective shares of Crown Class A Stock and, if any, Crown Class B Stock
to be contributed to the Company pursuant to Section 3.1, and the Company will
deliver to the Contributors share certificates representing the Common Stock
to be issued to the Contributors pursuant to Section 3.1.
ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF HEH
HEH hereby represents and warrants as follows as of the date hereof:
4.1 Corporate Existence. Each of the Company and HEH is a corporation
duly incorporated, validly existing and in good standing under the laws of
Delaware, and is duly qualified to do business as a foreign corporation and is
in good standing in each jurisdiction in which the ownership or use of any of
its assets or properties, or the conduct or nature of its business, makes such
qualification necessary, except for any jurisdictions in which the failure to
be so qualified could not reasonably be expected to have a Material Adverse
Effect on HEH or the Company, respectively. The Company has all requisite
power and authority to conduct its business and own its properties as now
conducted and owned, except for such failure to have such power and authority
which could not reasonably be expected to have a Material Adverse Effect on
the Company. HEH has previously provided to each of the Contributors true and
complete copies of the Certificate of Incorporation and By-laws of the Company
as in effect on the date hereof.
4.2 Power and Authority. Each of the Company and HEH has the
requisite power and authority, and has taken all required action necessary, to
execute, deliver and perform this Agreement and all Related Documents to which
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it is a party. None of the foregoing actions will (i) violate any provision of
the By-laws, Certificate of Incorporation or other organizational document of
the Company or any of its Subsidiaries, or HEH (ii) result in the breach of or
constitute a default under any material contract, lease, license, franchise,
permit, indenture, mortgage, deed of trust, note, agreement or other
instrument to which the Company or any of its Subsidiaries is a party or by
which any of them is bound, (iii) result in the creation or imposition of any
material lien, claim or encumbrance on any asset of the Company or any of its
Subsidiaries, (iv) give any Person rights to terminate any contracts or
agreements of the Company or otherwise to exercise rights against the Company
or (v) to the knowledge of HEH, give any Person rights to terminate any
contracts or agreements of the Company's Subsidiaries or otherwise to exercise
rights against the Company's Subsidiaries or (vi) violate any Law or Order
applicable to or bearing upon the Company or any of its Subsidiaries or their
assets or businesses except, in the case of each of clauses (ii), (iii), (iv),
(v) or (vi) for such violations, breaches, defaults, rights and impairments
that could not reasonably be expected to have a Material Adverse Effect on the
Company and its Subsidiaries taken as a whole.
4.3 Enforceability, etc. Assuming the due authorization, execution
and delivery of each other party thereto, this Agreement and each of the
Related Documents have been duly executed and delivered by each of the Company
and HEH, and constitute the legal, valid and binding obligation of each of the
Company and HEH, as applicable, enforceable against them in accordance with
their respective terms, subject to (i) the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally and (ii) general
equitable principles (whether considered in a proceeding in equity or at law).
4.4 Capitalization.
(a) Item 4.4 of the Disclosure Schedule sets forth, as of the
date of this Agreement and, upon completion of the exchange set forth in
Section 3.1, a true and complete statement of the outstanding Interests of the
Company (the "Company Capitalization Schedule"). Except as set forth on the
Company Capitalization Schedule, the Company has not issued any Interests, nor
are any such Interests (or any rights to acquire or purchase any such
Interests) outstanding. Except for Encumbrances set forth on Item 4.4(a) of
the Disclosure Schedule, the shares of Crown Class A Stock and Crown Class B
Stock owned by HEH are owned, and will be delivered to the Company, free and
clear of any Encumbrances, preemptive rights, escrows, options, rights of
first refusal or other agreements, arrangements, commitments, understandings
or obligations, whether written or oral, or any other restrictions affecting
rights and other incidents of record and beneficial ownership, other than (i)
as set forth herein or in the Related Documents and (ii) restrictions on
transferability imposed generally under the Securities Act and under the
securities laws of the several states and the rules and regulations issued in
respect thereto (such state laws, rules and regulations being, collectively,
"Blue Sky Laws").
(b) The Class A Stock and Class B Stock to be delivered to the
Contributors, when issued and delivered to the Contributors pursuant to this
Agreement against payment of the consideration set forth herein, will be duly
authorized, validly issued, fully paid and non-assessable and will be free and
clear of any Encumbrances, preemptive rights, escrows, options, rights of
first refusal or other agreements, arrangements, commitments, understandings
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or obligations, whether written or oral, or any other restrictions affecting
rights and other incidents of record and beneficial ownership, other than (i)
as set forth herein or in the Related Documents and (ii) restrictions on
transferability imposed generally under the Securities Act and under Blue Sky
Laws.
(c) The issuance and delivery of the Common Stock to the
Contributors on the terms and conditions contemplated herein are exempt from
the registration requirements of the Securities Act and the Blue Sky Laws or
will be qualified as may be necessary.
4.5 Consents and Approvals. Except as set forth on Item 4.5 of the
Disclosure Schedule, neither the execution, delivery and performance of this
Agreement or any Related Documents by the Company or HEH, nor the consummation
by the Company or HEH of any transaction related hereto or thereto, nor the
issuance or delivery of the Common Stock will require any consent, approval,
Order or authorization of, filing, registration, declaration or taking of any
other action with, or notice to, any Person, other than such consents,
approvals, filings or actions (i) under the Federal securities laws or the
Blue Sky Laws, (ii) the failure of which to take or obtain would not
reasonably be expected to have a Material Adverse Effect on the Company or
HEH, as applicable or (iii) which have already been obtained.
4.6 No Liabilities. The Company was incorporated on July 14, 1998.
The Company currently has no liabilities (contingent or otherwise). There are
no actions, suits proceedings, orders, investigations or claims pending or
threatened against the Company.
4.7 Brokers, etc. None of HEH or the Company is obligated to pay any
fee or commission to any broker, finder or other similar Person in connection
with the transaction contemplated hereby or any of the transactions
contemplated by this Agreement or the Related Documents.
ARTICLE V - REPRESENTATIONS AND WARRANTIES OF THE MINORITY
CONTRIBUTORS
Each Minority Contributor, severally and not jointly, represents and
warrants as to those matters pertaining to itself only (and not the other
Minority Contributors) as follows as of the date hereof:
5.1 Existence; Power and Authority. Such Minority Contributor is duly
organized, validly existing and in good standing under the laws of the
jurisdiction set forth opposite its name as set forth on Item 5.1 of the
Disclosure Schedule. Such Minority Contributor has all requisite power and
authority and has taken all required action necessary to execute and deliver
and perform this Agreement, the Related Documents and each other document or
instrument related hereto or thereto to which it is a party, and to carry out
the terms hereof and thereof. None of the foregoing actions will (i) violate
any provision of the organizational documents of such Minority Contributor,
(ii) result in the breach of or constitute a default under any material
contract, lease, license, franchise, permit, indenture, mortgage, deed of
trust, note, agreement or other instrument to which such Minority Contributor
is a party or is bound, (iii) violate any Law or Order applicable to or
bearing upon such Minority Contributor or any of their respective assets or
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business, except, in the case of (ii) and (iii), for such conflicts,
violations, breaches, rights and impairments that could not reasonably be
expected to have a Material Adverse Effect on such Minority Contributor.
5.2 Enforceability, etc. Assuming the due authorization, execution
and delivery by each other party thereto, this Agreement and the Related
Documents have been duly executed and delivered by such Minority Contributor
and constitute the legal, valid and binding obligation of such Minority
Contributor, enforceable against it in accordance with their respective terms,
subject to (i) the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally and (ii) general equitable principles (whether
considered in a proceeding in equity or at law).
5.3 Ownership. The shares of Crown Class A Stock to be contributed by
such Minority Contributor to the Company are owned, and will be delivered to
the Company, free and clear of any Encumbrances, preemptive rights, escrows,
options, rights of first refusal or other agreements, arrangements,
commitments, understandings or obligations, whether written or oral, or any
other restrictions affecting rights and other incidents of record and
beneficial ownership, other than (i) as set forth herein or in the Related
Documents and (ii) restrictions on transferability imposed generally under the
Securities Act and under Blue Sky Laws.
5.4 Consents and Approvals. Except as set forth on Item 5.4 of the
Disclosure Schedule, neither the execution, delivery and performance of this
Agreement or any Related Document by such Minority Contributor, nor the
consummation by such Minority Contributor of any transaction related hereto or
thereto will require any consent, approval, Order or authorization of, filing,
registration, declaration or taking of any other action with, or notice to,
any Person, other than such consents, approvals, filings or actions (i) under
the Federal securities laws or the Blue Sky Laws, (ii) the failure of which to
take or obtain would not reasonably be expected to have a Material Adverse
Effect on such Minority Contributor or (iii) which have already been obtained.
5.5 Purchase for Investment. Such Minority Contributor, as
applicable, is acquiring the Class A Stock pursuant to Section 3.1 for its own
account for investment purposes and not as a nominee or agent for any other
Person and with no present intention of distribution thereof within the
meaning of the Securities Act. Such Minority Contributor understands that the
Class A Stock must be held indefinitely unless it is registered under the
Securities Act or an exemption from such registration becomes available.
5.6 Financial Matters. Such Minority Contributor acquiring Class A
Stock pursuant to Section 3.1 represents and understands that the acquisition
of the Class A Stock involves substantial risk and that such Minority
Contributor's financial condition and investments are such that it is in a
financial position to hold the Class A Stock for an indefinite period of time
and to bear the economic risk of, and withstand a complete loss of, such Class
A Stock. Such Minority Contributor that is acquiring Class A Stock pursuant to
Section 3.1 represents that it is an "accredited investor" as that term is
defined in Regulation D promulgated under the Securities Act, and that it is a
sophisticated investor, capable of evaluating the merits and risks of
investing in the Company given its current stage of development.
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5.7 Brokers, etc. Such Minority Contributor is not obligated to pay
any fee or commission to any broker, finder or other similar Person in
connection with the transaction contemplated hereby or any of the transactions
contemplated by this Agreement or the Related Documents.
ARTICLE VI - INDEMNIFICATION
6.1 Indemnification.
(a) HEH agrees from and after the Closing to (i) indemnify and
hold harmless the Minority Contributors, all of their respective officers,
directors, affiliates, employees and agents, and each of the successors and
assigns of any of the foregoing (the "Contributor Indemnified Persons") from
and against any Adverse Consequences (but excluding any consequential damages
of the Contributor Indemnified Persons), and (ii) defend the Contributor
Indemnified Persons against any Actions, to the extent such Adverse
Consequences or Actions arise out of or result from (A) the breach or
inaccuracy of any representation or warranty of HEH or the Company contained
in Article IV or the corresponding Items of the Disclosure Schedules hereto or
(B) activities of the Company prior to the date hereof.
(b) Each of the Minority Contributors, severally and not
jointly, agrees from and after Closing to (i) indemnify and hold harmless the
Company, all of its officers, directors, affiliates, employees and agents, and
each of the successors and assigns of any of the foregoing (the "Company
Indemnified Persons") from and against, and waive any claim for contribution
against the Company with respect to, any Adverse Consequences (but excluding
any consequential damages of the Company Indemnified Persons), and (ii) defend
the Company Indemnified Persons against any Actions, to the extent such
Adverse Consequences or Actions arise out of or result from the breach or
inaccuracy of any of its representations or warranties contained in Article V
or the corresponding Items of the Disclosure Schedule hereto.
To clarify the intention of the Parties with respect to the
indemnification obligations of the Company, HEH, and the Minority Contributors
under this Section 6.1, the Parties hereto acknowledge that if the
indemnification of any Indemnified Person(s) pursuant to this Section 6.1
directly or indirectly reduces or eliminates the Adverse Consequences suffered
by any other Indemnified Person(s), the Indemnifying Party shall not be
required to indemnify such other Indemnified Person(s) to the extent that such
Adverse Consequences have been reduced or eliminated. The Contributors will
have the right to cause the Company to assert a claim for indemnification
under this Section 6.1 and will have the right to conduct and control any
resulting action against the Indemnifying Party (at such Contributor(s)'
expense subject to any indemnification obligation of the Indemnifying Party in
respect thereof).
6.2 Procedure for Indemnification. If any Person shall claim
indemnification (the "Indemnified Party") hereunder for any claim other than a
third party claim, the Indemnified Party shall promptly give written notice to
the other party from whom indemnification is sought (the "Indemnifying Party")
of the nature and amount of the claim. If an Indemnified Party shall claim
indemnification hereunder arising from any claim or demand of a third party,
the Indemnified Party shall promptly give written notice (a "Written Notice")
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to the Indemnifying Party of the basis for such claim or demand, setting forth
the nature of the claim or demand in detail. The Indemnifying Party shall have
the right to compromise or, if appropriate, defend at its own cost and through
counsel of its own choosing (reasonably acceptable to the Indemnified Party),
any claim or demand set forth in a Written Notice giving rise to such claim
for indemnification. In the event the Indemnifying Party undertakes to
compromise or defend any such claim or demand, it shall promptly (and in any
event, no later than thirty (30) days after receipt of the Written Notice)
notify the Indemnified Party in writing of its intention to do so. If the
Indemnifying Party fails to notify the Indemnified Party of its intent to
undertake the compromise or defense of such claim or demand, then the
Indemnified Party may do so at the expense of the Indemnifying Party. The
parties shall fully cooperate in the defense or compromise of any indemnified
claim or demand. After the assumption of the defense by the Indemnifying
Party, the Indemnifying Party shall not be liable for any legal or other
expenses subsequently incurred by the Indemnified Party, in connection with
such defense, but the Indemnified Party may participate in such defense at its
own expense. No settlement of a third party claim or demand defended by the
Indemnifying Party shall be made without the written consent of the
Indemnified Party, such consent not to be unreasonably withheld. The
Indemnifying Party shall not, except with written consent of the Indemnified
Party, consent to the entry of a judgment or settlement which does not include
as an unconditional term thereof, the giving by the claimant or plaintiff to
the Indemnified Party of an unconditional release from all liability in
respect of such third party claim or demand.
6.3 Time Limitations on Indemnity. The representations and warranties
made herein by the Parties and the corresponding indemnifications contained in
Section 6.1 shall survive the Closing without limitation.
6.4 Limitations on Indemnity. The sole and exclusive remedies of the
Parties with respect to breaches of this Agreement shall be pursuant to this
Article VI; provided, that nothing herein shall limit the rights of any Party
to seek any relief in equity or limit in any way any Party's remedies in
respect of fraud by another party in connection herewith or the transactions
contemplated hereby.
ARTICLE VII - GENERAL PROVISIONS; OTHER AGREEMENTS
7.1 Expenses. The Company shall pay for all of its expenses incurred
in connection with the transactions contemplated by this Agreement. Each
Contributor shall bear its own expenses incurred in connection with the
transactions contemplated by this Agreement.
7.2 Governing Law; Jurisdiction; Forum. This Agreement shall be
governed by and construed in accordance with the laws of the State of New
York, including, without limitation, Sections 5-1401 and 5-1402 of the New
York General Obligations Law and New York Civil Practice Laws and Rules
327(b). The Parties agree that the appropriate and exclusive forum for any
disputes between the Parties arising out of this Agreement or the transactions
contemplated hereby will be any state or federal court in the States of New
York.
7.3 Further Assurances. Each Party agrees to use its reasonable best
efforts to take, or cause to be taken, all actions, and to do, or cause to be
done, and to assist and cooperate with the other Parties in doing, all things
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necessary, proper or advisable to consummate and make effective, in the most
expeditious manner practicable, the transactions contemplated by this
Agreement and the Related Documents to which it is a Party, including the
execution and delivery of any additional instruments necessary to consummate
the transactions contemplated by, and to fully carry out the purposes of, this
Agreement and the Related Documents.
7.4 Headings. Article and Section headings used in this Agreement are
for convenience only and shall not affect the meaning or construction of this
Agreement.
7.5 Notices. All notices, requests, demands or other communications
required by or otherwise with respect to this Agreement shall be in writing
and shall be deemed to have been duly given to any Party when delivered by
hand, by messenger or by a nationally recognized overnight delivery company,
when delivered by facsimile and confirmed by return facsimile, or when
delivered by first class mail, postage prepaid and return receipt requested,
in each case to the applicable addresses set forth on Appendix II.
7.6 Parties in Interest. All the terms and provisions of this
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the Parties and their respective successors and permitted assigns;
provided, that, except as otherwise expressly set forth in this Agreement,
neither the rights nor the obligations of any Party may be assigned or
delegated without the prior written consent of each of the other Parties and
any purported assignment in violation hereof shall be null and void.
7.7 Entire Agreement. This Agreement, the Related Documents, and any
agreements set forth as an exhibit to this Agreement or any Related Document
constitute the entire agreement between the Parties hereto and thereto and
supersede all prior agreements, representations, warranties and
understandings, both written and oral, with respect to the subject matter
hereof or thereof.
7.8 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be considered an original, but all of which
together shall constitute the same instrument.
7.9 Amendment. This Agreement may be modified or amended only by an
instrument in writing signed by all of the Parties.
7.10 Gender, etc. Whenever the context may require, any pronouns used
herein shall be deemed to refer to the masculine, feminine, or neuter forms,
and the singular form of nouns, pronouns and verbs shall include the plural,
and vice versa. Whenever used herein, the terms "include," "includes" and
"including" shall mean to include without limitation.
7.11 Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement shall be
prohibited by or invalid under applicable law, such provisions shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Agreement.
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7.12 No Waiver. No failure to exercise and no delay in exercising any
right, power or privilege granted under this Agreement shall operate as a
waiver of such right, power or privilege. No single or partial exercise of any
right, power or privilege granted under this Agreement shall preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege.
*************************************************
SIGNATURE PAGE FOLLOWS
11
IN WITNESS WHEREOF, the Parties hereto have duly executed this
Agreement as of the date first written above.
HALLMARK ENTERTAINMENT INVESTMENTS, CO.
By: /s/Xxxxxx Xxxxxxxxx/s/
-----------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Vice President
HALLMARK ENTERTAINMENT HOLDINGS, INC.
By: /s/Xxxxxx Xxxxxxxxx/s/
-----------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Vice President
LIBERTY CROWN, INC.
By: /s/Xxxxx X. Xxxx/s/
-----------------------------------
Name: Xxxxx X. Xxxx
Title: Senior Vice President
VISN MANAGEMENT CORP.
By: /s/Xxxxxxx X. Xxxx, Xx./s/
-----------------------------------
Name: Xxxxxxx X. Xxxx, Xx.
Title: Chair - VMC
XX XXXXXX PARTNERS (BHCA), L.P.,
By JPMP MASTER FUND MANAGER, L.P.,
its general partner
By JPMP CAPITAL CORP.,
its general partner
By: /s/Xxxxxxx X. Xxxxxx/s/
-----------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Managing Director
[SIGNATURE PAGE TO THE CONTRIBUTION AGREEMENT]
Item 4.4
Hallmark Entertainment Investments Co. Capitalization Schedule
--------------------------------------------------------------
---------------------------------------- ------------------- -------------------
Stockholder Class A Stock Class B Stock
---------------------------------------- ------------------- -------------------
Hallmark Entertainment Holdings, Inc. 39,260 30,670
---------------------------------------- ------------------- -------------------
Liberty Crown, Inc. 9,417
---------------------------------------- ------------------- -------------------
XX Xxxxxx Partners (BHCA), L.P. 3,837
---------------------------------------- ------------------- -------------------
VISN Management Corp. 634
---------------------------------------- ------------------- -------------------
Item 4.4(a)
Liens on Crown Stock
--------------------
The shares are subject to Xxxxxx Xxxxx, Xx.'s option to acquire 3.4 million
shares of Crown Class A Stock pursuant to his existing employment agreement
with Hallmark Entertainment Holdings, Inc.
Item 5.1
Jurisdiction of Organization
----------------------------
------------------------------------- ------------------------------------------
Minority Contributor Jurisdiction
------------------------------------- ------------------------------------------
Liberty Crown, Inc. Delaware corporation
------------------------------------- ------------------------------------------
XX Xxxxxx Partners (BHCA), L.P. Delaware limited partnership
------------------------------------- ------------------------------------------
VISN Management Corp. Delaware corporation
------------------------------------- ------------------------------------------
Item 5.4
Minority Shareholder Required Consents
--------------------------------------
None
APPENDIX I
------------------------- ---------------------------------------------- ---------------------------------------------
Shares of Crown Common Stock Contributed Shares of Common Stock to Be Received
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
Contributor Crown Class A Common Crown Class B Common Class A Stock Class B Stock
Stock Stock
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
Hallmark Entertainment 39,259,480 30,670,422 39,260 30,670
Holdings, Inc.
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
Liberty Crown, Inc. 9,416,746 9,417
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
XX Xxxxxx Partners 3,836,620 3,837
(BHCA), L.P.
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
VISN Management Corp. 633,803 634
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
APPENDIX II
Notices
-------
If to the Company or Hallmark Entertainment Holdings, Inc. to:
Hallmark Cards, Incorporated
Department 339
0000 XxXxx
Xxxxxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxxx, Executive Vice President, General Counsel
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With copies to:
Hallmark Entertainment, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxx, Xx.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to Liberty Crown, Inc. to:
Liberty Crown, Inc.
00000 Xxxxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxx, Senior Vice President
Facsimile: (000) 000-0000
With a copy to:
Liberty Media Corporation
00000 Xxxxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxx
Facsimile: (000) 000-0000
And to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000-0000
Attention: Xxx Xxxxxx
Facsimile: (000) 000-0000
If to XX Xxxxxx Partners (BHCA), L.P. to:
XX Xxxxxx Partners (BHCA), L.P.
0000 Xxxxxx xx xxx Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
Xxxxx, Xxxxx & Xxxxx
0000 Xxxxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxxxxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to VISN Management Corp. to:
VISN Management Corp.
000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
Cowan, DeBaets, Xxxxxxxx & Xxxxxxxx LLP
00 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
