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SHAREHOLDERS AGREEMENT
This Shareholders Agreement (this "Agreement") is entered into as of
this 9th day of June, 1997 by and among Cyrk, Inc., a Delaware corporation (the
"Company"), Xxxxx Xxxxx, Xxxx Xxxxxxx, Xxxxxxx Xxxxxxx, and Xxxxxxx Xxxxx (each
a "Shareholder", and together the "Shareholders").
INTRODUCTION
The Company, Xxxxx Xxxxx and Xxxx Xxxxxxx, along with Simon Marketing,
Inc., a Nevada corporation, and SMI Merger, Inc., a Delaware corporation, are
parties to an Agreement and Plan of Merger, dated as of May 7, 1997 (as amended
from time to time, the "Merger Agreement"), pursuant to which, INTER ALIA, Xxxxx
Xxxxx and Xxxx Xxxxxxx have acquired shares of common stock, par value $.01 per
share, of the Company (the "Common Stock"). The execution of this Agreement is a
condition precedent to the Closing of the transaction contemplated under the
Merger Agreement. Capitalized terms used herein and not otherwise defined shall
have the meanings given to them in the Merger Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
SECTION 1. APPOINTMENT OF DIRECTOR.
(a) Promptly upon the execution of this Agreement, the Board of
Directors of the Company (the "Board") shall take all necessary action to
increase the size of the Board to six and to appoint Xxxxx Xxxxx to be a member
of the Board as a class I director; PROVIDED, HOWEVER, that Xxxxx Xxxxx'x
appointment to be a member of the Board shall be effective as soon as determined
by Xxxxx Xxxxx to be reasonably practicable but no later than January 1, 1998.
At each election thereafter of class I directors, and provided that Xxxxx Xxxxx
beneficially owns at least five percent (5%) of the issued and outstanding
Common Stock of the Company as of the date of such election, the Shareholders
shall nominate Xxxxx Xxxxx for election as a class I director.
(b) At any time following the execution of this Agreement, Xxxx Xxxxxxx
shall have the right, upon his request, to be appointed a member of the Board
(and to be a class I, II or III director, as determined by Xxxx Xxxxxxx in his
sole discretion and set forth in such request). Within ninety (90) days
following the Board's receipt of such request of Xxxx Xxxxxxx, the Board shall
take all necessary action to increase the size of
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the board by one (1) and appoint Xxxx Xxxxxxx to be a member of the Board as a
class I, II, or III director in accordance with Xxxx Xxxxxxx'x request referred
to above. At each election thereafter of the class of directors of the Board to
which Xxxx Xxxxxxx is appointed, and provided that Xxxx Xxxxxxx beneficially
owns at least five percent (5%) of the issued and outstanding Common Stock of
the Company as of the date of such election, the Shareholders shall nominate
Xxxx Xxxxxxx for election as a class I, II or III director, as the case may be.
SECTION 2. VOTING. At all meetings (and written actions in lieu of
meetings) of the stockholders of the Company at which directors are to be
elected, and at which Xxxxx Xxxxx, Xxxx Xxxxxxx, Xxxxxxx Xxxxxxx or Xxxxxxx
Xxxxx have been nominated for election, each Shareholder shall vote all of such
Shareholder's stock to elect Xxxxx Xxxxx, Xxxx Xxxxxxx, Xxxxxxx Xxxxxxx and
Xxxxxxx Xxxxx, as the case may be, as directors of the Company.
SECTION 3. MEETINGS. The Company will cause its Board of Directors to
meet on a regular basis, not less often than quarterly, and will give each
director at least 7 days prior notice of the time and place of any meeting.
SECTION 4. REPRESENTATIONS. Each Shareholder represents and warrants to
each other party that such Shareholder is not bound by any agreement or
commitment that conflicts with or would interfere with the performance of such
Shareholder's obligations under this Agreement.
SECTION 5. MISCELLANEOUS. This Agreement shall survive indefinitely and
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Delaware. If any
provision of this Agreement is rendered void, invalid or unenforceable by any
court of law for any reason, such invalidity or unenforceability shall not void
or render invalid or unenforceable any other provision of this Agreement. This
Agreement may be changed, waived, discharged or terminated only with the written
consent of each party hereto. This Agreement may be executed in one or more
counterparts, and with counterpart signature pages, each of which shall be an
original, but all of which together shall constitute one in the same Agreement.
SECTION 6. NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered personally,
telecopied (which is confirmed) or mailed by registered or certified mail
(return receipt requested) to the parties at the following addresses (or at such
other address for a party as shall be specified by like notice):
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(a) if to Xxxxx Xxxxx or Xxxx Xxxxxxx, to:
Xxxxx Xxxxx
c/o Simon Marketing, Inc.
1900 Avenue of the Stars
0xx Xxxxx, Xxxxx 000
Xxx Xxxxxxx, XX 00000
Xxxx Xxxxxxx
x/x Xxxxx Xxxxxxxxx Xxxx Xxxx Ltd.
Xxxxxx Xxxxx, 0xx Xxxxx
00 Xxxxxxxxxx Xxxx
Xxxxxxx, Xxxx Xxxx
with a copy to:
Irell & Xxxxxxx
1800 Avenue of the Stars
Xxxxx 000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxx, Esq.
Xxxxxx, Xxxxxxxx & Xxxxxxxx
0000 Xxxxxxx Xxxx Xxxx
Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxx, Esq.
Shearman & Sterling
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx, Esq.
(b) if to the Company, Xxxxxxx Xxxxx or to Xxxxxxx
Xxxxxxx, to:
Cyrk, Inc.
0 Xxxx Xxxx
Xxxxxxxxxx, XX 00000
Xxxxxxx Xxxxx
c/o Cyrk, Inc.
0 Xxxx Xxxx
Xxxxxxxxxx, XX 00000
Xxxxxxx Xxxxxxx
c/o Cyrk, Inc.
0 Xxxx Xxxx
Xxxxxxxxxx, XX 00000
with a copy to:
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Xxxxxx, Hall & Xxxxxxx
Exchange Place
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Cameron Read, Esq.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.
CYRK, INC.
By: /s/Xxxxxxx Xxxxxxx
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Xxxxxxx Xxxxxxx
/s/Xxxxx Xxxxx
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Xxxxx Xxxxx
/s/Xxxx Xxxxxxx
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Xxxxx Xxxxx
/s/Xxxxxxx Xxxxxxx
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Xxxxxxx Xxxxxxx
/s/Xxxxxxx Xxxxx
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Xxxxxxx Xxxxx
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