AMENDMENT TO STOCK PURCHASE AGREEMENT
AMENDMENT
TO
This
Amendment, dated as of October 23, 2008, is between Mandalay Media, Inc., a
Delaware corporation (“Buyer”) and Xxxxxxxxx XxxXxxxxx as the Sellers’
Representative.
1.
Reference
to Purchase Agreement. Reference is made to the Stock Purchase Agreement,
dated as of October 8, 2008, by and among Buyer, Xxxxxxxx Xxxxxxxxx (a/k/a
Xxxx
Xxxxxxxxx), Xxxxxxxxx XxxXxxxxx and the shareholders of AMV signatories thereto
(the “Purchase Agreement”). Capitalized terms used herein and not otherwise
defined herein shall have the meanings ascribed to them in the Purchase
Agreement.
2.
Amendment
to Section 1.1 of the Purchase Agreement. The following language is hereby
added to the end of the definition of “Working Capital” in Section 1.1 of the
Purchase Agreement:
“For
purposes of the determination of Working Capital, any costs, expenses or
liabilities incurred by AMV in connection with that certain Senior Secured
Note,
issued by Twistbox Entertainment, Inc. to ValueAct Smallcap Master
Fund, L.P., due January 30, 2010, as amended on February 12, 2008 and
October 23, 2008, shall not be considered to be current liabilities of AMV.”
3.
Amendment
to Section 2.4 of the Purchase Agreement.
Section
2.4(a) of the Purchase Agreement is hereby amended by adding the following
subsection (iv): “ and/or (iv) any costs, expenses or liabilities incurred by
AMV in connection with that certain Senior Secured Note issued by Twistbox
Entertainment, Inc. to ValueAct Smallcap Master Fund, L.P., due
January 30, 2010, as amended on February 12, 2008 and October 23, 2008, shall
be
excluded from the EBITDA determination.", such that Section 2.4(a) reads as
follows:
“(a)
Delivery
of Financial Information.
Within
90 days after the last Business Day of each Earn-Out Period (as defined below),
Buyer shall deliver to Sellers’ Representative (at Buyer’s cost and expense) a
worksheet (the “Earn-Out Worksheet”) prepared by AMV’s accountants or Buyer’s
accountants (or its designee), setting forth Buyer’s determination of earnings
before interest, tax, depreciation and amortization (each measured in accordance
with UK GAAP) as determined from the Seller Companies’ historical financial
statements consistent with past practice (“EBITDA”). Notwithstanding the
foregoing, the determination of EBITDA for any Earn-Out Period shall be made
using the following guidelines: (i) except as set forth below, any profits,
losses or other items relating to Fierce shall be excluded from the EBITDA
determination, (ii) any payments or management charges made by AMV at the
written direction of Buyer or the board of directors of AMV, which are outside
of the normal course of operations of AMV shall be excluded from the EBITDA
determination, (iii) any revenue from any source, except as contemplated by
the
parties, other than the existing business of the Acquired Companies on the
date
hereof shall not be included in the EBITDA determination and/or (iv) any costs,
expenses or liabilities incurred by AMV in connection with that certain Senior
Secured Note, issued by Twistbox Entertainment, Inc. to
ValueAct Smallcap Master Fund, L.P., due January 30, 2010, as amended
on February 12, 2008 and October 23, 2008, shall be excluded from the EBITDA
determination. Subject to execution of a Non-Disclosure Agreement in customary
form, Sellers shall have the right, at Sellers’ expense, during each Earn-Out
Period, at reasonable times and upon reasonable notice, to examine, and to
have
the Sellers’ Representative and their advisors examine, the books and records of
the Seller Companies to determine whether the calculation and payment of the
Earn-Out Payment are being conducted in accordance with the provisions of this
Agreement.”
4. Miscellaneous.
Except as otherwise set forth herein, the Purchase Agreement shall remain in
full force and effect without change or modification. This Amendment may be
executed in any number of counterparts, which together shall constitute one
instrument, and shall bind and inure to the benefit of the parties and their
respective successors and assigns.
[Remainder
of page intentionally left blank]
2
IN
WITNESS WHEREOF, the parties hereto have executed this Amendment as of the
day
and year first above written.
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By:
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/s/
Xxxxx Xxxxxxxxx
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Name:
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Xxxxx
Xxxxxxxxx
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Title:
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President
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SELLERS’
REPRESENTATIVE:
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/s/
Xxxxxxxxx XxxXxxxxx
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Xxxxxxxxx
XxxXxxxxx
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