EXHIBIT 10.34
EXECUTION COPY
STOCK PURCHASE AGREEMENT
DATED AS OF JANUARY 15, 2002
BY AND AMONG
GC COMPANIES, INC.
(THE "Seller")
AND
AMC ENTERTAINMENT INC.
AMERICAN MULTI-CINEMA, INC.
AND
CENTERTAINMENT DEVELOPMENT, INC.
(COLLECTIVELY, THE "PURCHASERS")
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT, dated as of January 15, 2002,
is entered into by and among GC COMPANIES, INC., a Delaware corporation ("GCX"
or "SELLER"), and AMC ENTERTAINMENT INC., a Delaware corporation ("AMCE"),
AMERICAN MULTI-CINEMA, INC., a Missouri corporation ("AMC"), and CENTERTAINMENT
DEVELOPMENT, INC., a Delaware corporation ("CDI"), (AMCE, AMC and CDI being
hereinafter referred to collectively as the "PURCHASERS" and individually from
time to time as a "PURCHASER").
Recitals
WHEREAS, GCX and certain of its subsidiaries (collectively,
the "DEBTORS") are the debtors and debtors-in-possession in chapter 11
proceedings pending in the United States Bankruptcy Court for the District of
Delaware (the "BANKRUPTCY COURT") as case numbers 00-3897 through 00-3927 (as
administratively consolidated, the "CHAPTER 11 CASES"); and
WHEREAS, GCX is a holding company engaged in three primary
lines of business (collectively, the "GC BUSINESS") through its Subsidiaries and
Affiliates: (i) a wholly-owned domestic movie theatre exhibition business (the
"DOMESTIC THEATRE BUSINESS") conducted through General Cinema Theatres, Inc.
("GCT") and its Subsidiaries, (ii) the 50% interest of General Cinema
International, Inc. ("GC INTERNATIONAL") in a South American movie theatre
exhibition business (the "SA THEATRE BUSINESS") owned by and conducted through
Hoyts General Cinema South America, Inc. ("HGCSA") and its Affiliates
(collectively, the "SA JOINT VENTURE"), and (iii) a private investment business
(the "INVESTMENT PORTFOLIO") conducted through GCC Investments, Inc. ("GCC
INVESTMENTS") and its Affiliates; and
WHEREAS, AMCE has entered into a letter of intent dated
December 6, 2001 (as amended, the "LOI") with GCX whereby AMCE, through its
designees, would acquire the GC Business (the "TRANSACTION") through the
acquisition of 100% of the stock of reorganized GCX under a plan of
reorganization for the Debtors in the Chapter 11 Cases; and
WHEREAS, AMCE desires that AMC and CDI, each wholly owned
subsidiaries of AMCE, act as its designees pursuant to the LOI, and,
accordingly, AMC will acquire 100% of the newly issued common stock of GCX (the
"NEW GCX COMMON STOCK") and CDI will acquire 100% of the GC International stock
(the "GC INTERNATIONAL STOCK") and 100% of the of the GCC Investments stock (the
"GCC INVESTMENTS STOCK"), (the New GCX Shares, GC International Stock and the
GCC Investments Stock shall be collectively referred to as the "PURCHASED
SHARES").
Agreements
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements contained in this Agreement and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties to this Agreement agree as follows:
ARTICLE I
DEFINITIONS
1.01 DEFINITIONS. Unless the context otherwise requires, the terms
defined in this Section 1.01 shall have the meanings specified for all purposes
of this Agreement. Capitalized terms used and not defined in this Agreement have
the meaning ascribed thereto in the Plan.
"ACTIONS OR PROCEEDINGS" means any action, suit, proceeding,
arbitration or Governmental or Regulatory Authority investigation.
"AFFILIATE" means, as applied to any Person, any other Person directly
or indirectly controlling, controlled by or under common control with that
Person. For the purposes of this definition, "control" (including with
correlative meanings, the terms "controlling", "controlled by", and "under
common control with") as applied to any Person, means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of that Person, whether through ownership of voting securities or
by contract otherwise.
"AGREEMENT" means this Stock Purchase Agreement, the Exhibits and the
Data Room Index and the certificates delivered in connection herewith, as the
same may be amended from time to time in accordance with the terms hereof.
"AMC" has the meaning ascribed to it in the Preamble.
"AMCE" has the meaning ascribed to it in the Preamble.
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"AMENDED AND RESTATED CERTIFICATE OF INCORPORATION OR CHARTER" means,
with respect to each Reorganized Debtor, the amended and restated certificate or
articles of incorporation or charter (or document of similar effect with respect
to any Debtor that is not a corporation) for such Reorganized Debtor, which
shall be substantially in the forms of the example set forth in the Plan
Documentary Supplement.
"AMENDED AND RESTATED BYLAWS" means, with respect to each Reorganized
Debtor, the amended and restated bylaws for such Reorganized Debtor that is a
corporation, which shall be substantially in the forms of the examples set forth
in the Plan Documentary Supplement.
"ASSETS AND PROPERTIES" of any Person means all assets and properties
of every kind, nature, character and description (whether real, personal or
mixed, whether tangible or intangible, whether absolute, accrued, contingent,
fixed or otherwise and wherever situated), including the goodwill related
thereto, operated, owned or leased by such Person, including without limitation
cash, cash equivalents, Investment Assets, accounts and notes receivable,
chattel paper, documents, instruments, general intangibles, real estate,
equipment, inventory, goods and Intellectual Property.
"ASSOCIATE" means, with respect to any Person, any corporation or other
business organization of which such Person is an officer or partner or is the
beneficial owner, directly or indirectly, of 10% or more of any class of equity
securities or similar interests, any trust or estate in which such Person has a
substantial beneficial interest or as to which such Person serves as a trustee
or in a similar capacity and any relative or spouse of such Person.
"AUDITED FINANCIAL STATEMENTS" has the meaning ascribed to it in
Section 3.08.
"BANKRUPTCY CODE" means the Bankruptcy Reform Act of 1978, as amended,
as set forth in Title 11 of the United States Code, 11 U.S.C. Sections 101 et
seq., as applicable to the GC Chapter 11 Cases.
"BANKRUPTCY COURT" has the meaning ascribed to it in the Recitals.
"BUSINESS COMBINATION" means with respect to any Person any (a) merger,
consolidation or combination to which such Person is a party, (b) any sale,
dividend, split or other disposition of any capital stock or other equity
interests of such Person, (c) any tender offer (including without limitation a
self-tender), exchange offer, recapitalization, liquidation, dissolution or
similar transaction, (d) any sale, dividend or other disposition of all or a
material portion of the Assets and Properties of such Person or (e) the entering
into of any agreement or understanding, or the granting of any rights or
options, with respect to any of the foregoing.
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"BUSINESS DAY" means any day other than a Saturday, a Sunday or a
weekday on which banks in the City of New York or the City of Boston are
authorized to be closed.
"CDI" has the meaning ascribed to it in the Preamble.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended, and the rules and regulations promulgated
thereunder.
"CERCLIS" means the Comprehensive Environmental Response, Compensation
and Liability Information System list of sites maintained by the United States
Environmental Protection Agency under the provisions of CERCLA.
"CHAPTER 11 CASES" has the meaning ascribed to it in the Recitals.
"CLOSING" has the meaning ascribed to it in Section 2.03.
"COMMITTEE" means the Official Committee of Unsecured Creditors of the
Debtors appointed in the Chapter 11 Cases pursuant to Section 1102 of the
Bankruptcy Code.
"CONFIRMATION ORDER" means the order entered by the Bankruptcy Court
confirming the Reorganization Plan in accordance with the provisions of Chapter
11 of the Bankruptcy Code, which order must be in form and substance reasonably
satisfactory to AMCE and GCX and consistent with the Plan.
"CONTRACT" means any agreement, lease, license, evidence of
Indebtedness, mortgage, indenture, security agreement or other contract,
commitment or understanding (whether written or oral).
"CONTRACT SCHEDULE" means "Schedule G - Executory Contracts and
Unexpired Leases" filed by the Debtors in the Chapter 11 Cases, as amended, a
true and correct of which has been provided by GCX to the Purchasers.
"DATA ROOM INDEX" means that certain index of the documents,
information and other materials related to the GC Business that has been
provided by the Seller to the Purchasers and annexed hereto as Exhibit A and the
leases files for the Real Property Leases listed on Exhibit C. All of the
documents, agreements and other materials listed on the Data Room Index shall be
deemed furnished and made available to the Purchasers for all purposes of this
Agreement; provided, that documents, information and other materials listed in
the Data Room Index shall not be deemed to include any documents, information or
other materials referenced within the content of any of such items (e.g., a
reference to an agreement in the corporate minute book of a GC Entity
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shall not be deemed to constitute a disclosure with respect to such agreement,
unless such agreement was listed separately on the Data Room Index).
"DEBTOR(S)" means, individually or collectively, GCX, and each of its
subsidiaries that is a debtor and debtor-in-possession under Chapter 11 of the
Bankruptcy Code in the Chapter 11 Cases as set forth in footnote 1 of the Plan,
but does not include the GC Chapter 7 Debtors, the GC Non-Debtors or the SA
Joint Venture.
"DIP FACILITY" means that certain Debtor in Possession Agreement dated
October 11, 2000, by and between GCX, General Electric Capital Corporation,
Fleet National Bank, and the Bank of Nova Scotia, as amended.
"DOMESTIC THEATRE BUSINESS" has the meaning ascribed to it in the
Recitals.
"EFFECTIVE DATE" has the meaning ascribed to it in Section 2.03.
"EMPLOYEES" has the meaning ascribed to it in Section 3.13.
"EMPLOYEE PLAN(S)" means all employee pension plans, any bonus,
incentive compensation, deferred compensation, profit sharing, pension,
retirement, savings, stock purchase, stock option, stock ownership, stock
appreciation rights, phantom stock, leave of absence, layoff, vacation, day or
dependent care, legal services, cafeteria, life, medical, dental, health,
accident, disability, workers compensation or other insurance, severance,
separation or other employee benefit plan, practice, policy, program or group or
individual arrangement of any kind providing money (other than as current salary
or wages), services, property or other benefits, written or oral, funded or
unfunded, and including all that have been frozen, and all trusts, escrow or
similar agreements related thereto which are maintained by any of the GC
Entities or any ERISA Affiliate with respect to any one or more of its present
or former employees, independent contractors, directors, officers or
shareholders or with respect to which any of the GC Entities or any ERISA
Affiliate has made or may be, now or in the future, required to make payments,
transfer or contributions.
"ENVIRONMENTAL, HEALTH AND SAFETY REQUIREMENTS" shall mean all Laws
concerning public health and safety, worker health and safety, and pollution or
protection of the environment including without limitation all those relating to
the presence, use, production, generation, handling, transportation, treatment,
storage, disposal, distribution, labeling, testing, processing, discharge,
release, threatened release, control, or cleanup of any hazardous materials,
substances or wastes, as such requirements are enacted and in effect on or prior
to the date of this Agreement.
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"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and the rules and regulations promulgated thereunder.
"ERISA AFFILIATE" means any other Person that, together with GCX, GCC
Investments or GC International, would be treated as a single employer under
section 414 of the Code.
"FINAL ORDER" has the meaning ascribed to it in the Plan.
"FINANCIAL STATEMENTS" has the meaning ascribed to it in Section 3.08.
"GAAP" means United States generally accepted accounting principles, as
in effect as of the relevant date.
"GC BUSINESS" has the meaning ascribed to it in the Recitals.
"GC CHAPTER 7 DEBTORS" means General Cinema Theatres of Florida, Inc.,
General Cinema Corp. of Georgia, General Cinema Corp. of Louisiana, General
Cinema Corp. of Rhode Island, General Cinema Corp. of Tennessee and General
Cinema Corp. of West Palm Beach, which are excluded from the Transaction.
"GC ENTITIES" means (i) the Debtors, (ii) the GC Non-Debtors, and (iii)
the SA Joint Venture Entities.
"GC INTERNATIONAL" has the meaning ascribed to it in the Recitals.
"GC INTERNATIONAL STOCK" has the meaning ascribed to it in the
Recitals.
"GC NON-DEBTORS" means the United States GCX Affiliates other than the
Debtors, to wit: (i) GC International, (ii) GC Security Corp., (iii) GCC
Investments, LLC and its Affiliates, (iii) the Premium - Liquor License Holders,
(iv) the Inactive Corporations, and (v) the Joint Venture Partners, each as
defined by and shown on the Organizational Chart.
"GCC INVESTMENTS" has the meaning ascribed to it in the Recitals. "GCC
Investments Stock" has the meaning ascribed to it in the Recitals. "GCT" has the
meaning ascribed to it in the Recitals.
"GCX" has the meaning ascribed to it in the Preamble.
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"GOVERNMENTAL OR REGULATORY AUTHORITY" means any court, tribunal,
arbitrator, authority, agency, commission, official or other instrumentality of
any federal, national, state, municipal, county, city or other political
subdivision with jurisdiction over any of the GC Entities or the GC Business.
"XXXXXX DOCUMENTS" means that certain Lease and Security Agreement
dated as of October 28, 1999 by and between Xxxxxx EMX, Inc. and GCX, as
amended, and any documents related thereto.
"HSR ACT" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976, as amended, and the rules and regulations thereunder.
"INDEBTEDNESS" of any Person means all obligations of such Person (a)
for borrowed money, (b) evidenced by notes, bonds, debentures or similar
instruments and (c) in the nature of guarantees of the obligations described in
clauses (a) and (b) above of any other Person.
"INTELLECTUAL PROPERTY" means all United States and foreign trademarks
and trademark rights, trade name rights, service marks and service xxxx rights,
service names and service name rights, copyrights and copyright rights, patents
and patent rights, business and product names, logos and slogans and computer
programs (including all source codes, object codes, firmware, development tools,
files, records and data) whether or not subject to statutory registration, and
all common law and world-wide rights to, pending United States and foreign
applications for and registrations of, patents (including all reissues,
divisions, renewals, extensions, provisionals, continuations and continuations
in part), trademarks, service marks and copyrights.
"INTELLECTUAL PROPERTY AGREEMENTS" has the meaning ascribed to it in
Section 3.17.
"INTERIM OPERATING AGREEMENT" means that certain Interim Operating
Agreement dated December 6, 2001 by and between GCX and AMCE, as such agreement
is amended from time to time or modified by the Bankruptcy Court with AMCE's
consent.
"INVESTMENT ASSETS" means all debentures, notes and other evidences of
Indebtedness, stocks, securities (including rights to purchase and securities
convertible into our exchangeable for other securities), interests in joint
ventures and general and limited partnerships, mortgage loans and other
investment or portfolio assets owned of record or beneficially by GCC
Investments and its Affiliates, as disclosed under Data Room Index Item X.
"INVESTMENT PORTFOLIO" has the meaning ascribed to it in the Recitals.
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"KNOWLEDGE" as used in connection with GCX or the GC Entities means the
actual knowledge of the officers and directors of the GC Entities.
"LAST STATEMENT DATE" means July 31, 2001.
"LAW" means all laws, statutes, rules, regulations, ordinances and
other pronouncements having the effect of law of any political instrumentality
with jurisdiction over any of the GC Entities or the GC Business.
"LIABILITY" means all indebtedness, obligations and other liabilities
of a Person (whether absolute, accrued, contingent, fixed or otherwise, or
whether due or to become due), including, without limitation, any fines,
penalties, judgments, awards, settlements respecting any judicial,
administrative or arbitration proceedings, damages, losses, claims or demands.
"LIEN" means any mortgage, pledge, assessment, security interest, lien,
levy, charge or other encumbrance of any kind.
"LOI" has the meaning ascribed to it in the Preamble.
"LOI ORDER" means an order of the Bankruptcy Court approving the LOI
and Interim Operating Agreement.
"MATERIAL ADVERSE EFFECT" means, with respect to the GC Business or the
Assets or Properties of the GC Business, any change in the condition (financial
or other), business, results of operations, prospects, assets, Liabilities or
operations of the GC Business and/or the Assets or Properties of the GC Business
taken as a whole that, individually or in the aggregate, has an adverse effect
of at least $1.5 million, or that substantially impairs the ability of the
Seller to consummate the Transaction, or any event or condition which would,
with the passage of time, constitute such a "Material Adverse Effect," except
for such changes that (i) are in the Ordinary Course of Business of the GC
Entities, (ii) are contemplated by the Plan, or (iii) occur as a result of the
September 11, 2001 terrorist attacks, general economic conditions in South
America or currency fluctuations with respect to South American countries.
"NEW GCX STOCK" has the meaning ascribed to it in the Recitals.
"ORDINARY COURSE OF BUSINESS" means a reasonable action taken by a
Person only if (taking into account the seasonality of the Person's business
and, in the case of GCX, the Chapter 11 Cases, (a) such action is consistent
with the past practices of such Person and is taken in the ordinary course of
normal day-to-day operations of such Person; and (b) such action is not required
to be authorized by the board of directors of such Person (or by any Person or
group of
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Persons exercising similar authority) and such Person is not otherwise required
to obtain the approval of AMCE or any other person as may be required by the
Interim Operating Agreement; except to the extent such action is provided for or
contemplated by the Plan, the LOI, the Interim Operating Agreement or this
Agreement.
"ORGANIZATIONAL CHART" means the organizational chart of GCX and its
Affiliates attached hereto as Exhibit B.
"ORGANIZATIONAL DOCUMENTS" means with respect to any entity: (a) the
articles or certificate of incorporation and the bylaws of a corporation; (b)
the partnership agreement and any statement of partnership of a general
partnership; (c) the limited partnership agreement and the certificate of
limited partnership of a limited partnership; (d) the certificate of formation
and limited liability company agreement of any limited liability company; (e)
any charter or similar document adopted or filed in connection with the
creation, formation, or organization of a Person; and (f) any amendment to any
of the foregoing.
"OPTION" with respect to any Person means any security, right,
subscription, warrant, option, "phantom" stock right or other Contract that
gives the right to (a) purchase or otherwise receive or be issued any shares of
capital stock or other equity interests of such Person or any security of any
kind convertible into, exchangeable or exercisable for any shares of capital
stock or other equity interests of such Person or (b) receive any benefits or
rights similar to any rights enjoyed by or accruing to the holder of shares of
capital stock or other equity interests of such Person, including without
limitation any rights to participate in the equity, income or election of
directors or officers of such Person.
"ORDER" means any writ, judgment, decree, injunction or similar order
of any Governmental or Regulatory Authority (in each such case whether
preliminary or final).
"PERMITTED LIENS" means (a) Liens for Taxes or governmental
assessments, charges or claims the payment of which is not yet due, or for Taxes
the validity of which are being contested in good faith by appropriate
proceedings, (b) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and other similar Persons imposed by
applicable Law and incurred in the Ordinary Course of Business; (c) Liens
relating to deposits made in the Ordinary Course of Business in connection with
workers compensation, unemployment insurance and other types of social security;
(d) minor defects of title, easements, rights-of-way, restrictions and other
similar charges or encumbrances not materially detracting from the value of the
property or interfering with the ordinary conduct of the GC Business; (e) Liens
not created by the GC Entities which affect the underlying fee interest of any
leased Real Property; (f) Liens related to the Xxxxxx Documents; (g) Liens of
the SA Lenders against certain stock and property of GCC Hoyts Chile, Inc.,
Hoyts Cinemas Chile SA, Boca Holdings, Inc. and Hoyts General Cinema de
Argentina, S.A.;
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and (h) the Lien of Bank of Nova Scotia against a $1.2 million certificate of
deposit securing that certain letter of credit issued by Bank of Nova Scotia in
favor of Fleet National Bank, which letter of credit secures one-half of the
letter of credit issued by Fleet National Bank or its Affiliates for the benefit
of the landlord of the SA Joint Venture's La Reina Alianza lease in Chile.
"PERSON" means any natural person, corporation, joint stock
corporation, general partnership, limited partnership, limited liability company
or partnership, proprietorship, other business organization, trust, union,
association or Governmental or Regulatory Authority.
"PLAN" means that certain Joint Plan of Reorganization of Debtors and
Official Committee of Unsecured Creditors for GC Companies, Inc. and its Jointly
Administered Subsidiaries filed with the Bankruptcy Court on December 21, 2001,
as the same may be amended with AMCE's consent.
"PLAN DOCUMENTARY SUPPLEMENT" means a supplement to the Plan,
containing the Plan Documents, to be filed with the Bankruptcy Court no later
than ten (10) Business Days prior to the commencement of the Confirmation
Hearing, as said supplement may be amended from time to time at any time prior
to the Effective Date.
"PLAN DOCUMENTS" has the meaning ascribed to it in the Plan.
"PROPONENTS" means those parties in interest proposing the Plan, i.e.,
the Debtors and the Committee.
"PURCHASED SHARES" has the meaning ascribed to it in the Recitals.
"PURCHASERS" has the meaning ascribed to it in the Recitals.
"QUARTERLY STATEMENTS" has the meaning ascribed to it in Section 3.08.
"Real Property" has the meaning ascribed to it in Section 3.14(a). "Real
Property Leases" has the meaning ascribed to it in Section 3.14(a).
"REIMBURSEMENT AGREEMENT" means that certain Amended and Restated
Reimbursement and Security Agreement dated January 26, 1999 between GCX and
Harcourt General, Inc.
"REORGANIZED DEBTORS" means, collectively, all of the Debtors or any
successors thereto by merger, consolidation, acquisition, or otherwise on and
after the Effective Date.
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"REPRESENTATIVES" means Purchaser and its Affiliates and each of their
respective officers, employees, agents, counsel, accountants, financial
advisors, consultants and other representatives.
"SA JOINT VENTURE" has the meaning ascribed to it in the Recitals.
"SA JOINT VENTURE ENTITIES" means HGCSA and its Affiliates, as shown on
the Organizational Chart.
"SA LENDERS" has the meaning ascribed to it in the Plan.
"SA THEATRE BUSINESS" has the meaning ascribed to it in the Recitals.
"SELLER" has the meaning ascribed to it in Preamble.
"SUBSIDIARY" means, with respect to any Person, (a) any corporation as
to which more than 50% of the outstanding stock having ordinary voting rights or
power (and excluding stock having voting rights only upon the occurrence of a
contingency unless and until such contingency occurs and such rights may be
exercised) is owned or controlled, directly or indirectly, by such Person and/or
by one or more of such Person's Subsidiaries, and (b) any partnership, joint
venture or other similar relationship between such Person (or any Subsidiary
thereof) and any other Person (whether pursuant to a written agreement or
otherwise) if such Person has a more than 50% equity interest therein.
"TAX" OR "TAXES" means any and all United States and foreign federal,
state, municipal or local net or gross income, gross receipts, net proceeds,
sales, use, ad valorem, value added, transfer, franchise, recapture,
withholding, payroll, employment, excise, premium, property, alternative or
add-on minimum, environmental or other taxes, assessments, duties, fees, levies
or other governmental charges of any nature whatsoever, but shall not include
any assessment or other charges of guaranty funds or similar organizations.
"TAX CODE" means the Internal Revenue Code of 1986, as amended, and the
rules and regulations promulgated thereunder.
"TAX RETURN" means any returns, reports, statements (including any
estimated reports, returns or statements) and other similar filings required to
be filed for purposes of a particular Tax.
"THIRD PARTY CLAIM" has the meaning ascribed to it in Section 8.02.
"TRANSACTION" has the meaning ascribed to it in the Recitals.
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1.02 INTERPRETATION. As used in this Agreement, the words "include" and
"including," are not words of limitation and should be read to also add "without
limitation." The word "or" is not exclusive and the words "herein", "hereof",
"hereby", "hereto" and "hereunder" refer to this Agreement as a whole. Any
reference to any applicable Law shall be deemed also to refer to all rules and
regulations promulgated thereunder unless the context otherwise requires.
Whenever required by the context, any gender shall include any other gender, the
singular shall include the plural and the plural shall include the singular.
Unless the context otherwise requires, references herein (a) to Articles,
Sections, Exhibits and Schedules mean the Articles and Sections of and the
Exhibits and Schedules attached to this Agreement and (b) to an agreement,
instrument or other document means such agreement, instrument or other document
as amended, supplemented and modified through the date hereof unless the context
otherwise requires and thereafter from time to time to the extent permitted by
this Agreement. The Schedules and Exhibits referred to herein shall be construed
with and as an integral part of this Agreement to the same extent as if they
were set forth verbatim herein. The Table of Contents and titles to Articles and
headings of Sections or Schedules are inserted for convenience of reference only
and shall not be deemed a part of or to affect the meaning or interpretation of
this Agreement.
1.03 ACCOUNTING RULES. Except as otherwise expressly provided, all
accounting terms used in this Agreement, whether or not defined in Section 1.01,
shall be construed in accordance with GAAP. If and so long as any Person has one
or more Subsidiaries, such accounting terms shall be determined on a
consolidated basis for the Person and each of its Subsidiaries, and the
financial statements and other financial information to be furnished by any
Person pursuant to this Agreement shall be consolidated and presented in
consolidating financial statements in accordance with GAAP.
ARTICLE II
SALE OF PURCHASED SHARES; CLOSING
2.01 PURCHASE AND SALE OF PURCHASED SHARES.
(a) GCX agrees to sell to AMC, and AMC agrees to purchase from GCX, the
New GCX Stock at the Closing on the terms and subject to the conditions set
forth in this Agreement.
(b) GCX agrees to sell to CDI, and CDI agrees purchase from GCX, the GC
International Stock at the Closing on the terms and subject to the conditions
set forth in this Agreement.
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(c) GCX agrees to sell to CDI, and CDI agrees purchase from GCX, the
GCC Investments Stock at the Closing on the terms and subject to the conditions
set forth in this Agreement.
2.02 PURCHASE PURSUANT TO PLAN. The Purchased Shares are being sold
pursuant to and in consideration of the Plan and consideration provided for
therein, and no additional consideration shall be paid at Closing.
2.03 CLOSING. The Closing (the "CLOSING") of the purchase and sale of
the Purchased Shares shall occur at the offices of Xxxxxxx Procter LLP, Xxxxxxxx
Xxxxx, Xxxxxx, XX 00000, at 10:00 A.M. local time, (a) on the first Business Day
following the date the Confirmation Order shall have become a Final Order or (b)
such other date as the Purchasers and the Seller shall mutually agree (the date
on which the Closing takes place being the "EFFECTIVE DATE"). At the Closing,
the Seller will sell and the Purchasers shall purchase the Purchased Shares,
free and clear of all Liens, and the Seller shall deliver to Purchasers a stock
certificate or certificates evidencing the Purchased Shares, duly endorsed to
the appropriate Purchaser with all required stock transfer tax stamps affixed or
provided for. At the Closing, there shall also be delivered by the Purchasers
and the Seller the certificates and other agreements, documents and instruments
to be delivered under Article V or as conditions to Closing under Article VI.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
Each of the representations and warranties set forth in this Article
III is qualified by the agreements and other documents listed on the Data Room
Index. Furthermore, no agreement, document or Lien for which no GC Entity has
any obligations after the Effective Date as a result of its rejection or
termination pursuant to the Plan shall be deemed to breach any of such
representations or warranties, regardless of whether such agreement, document or
Lien is listed on the Data Room Index. Subject to the foregoing, the Seller
hereby represents and warrants to the Purchasers as follows:
3.01 ORGANIZATION AND QUALIFICATION. Each of the GC Entities is duly
organized, validly existing and in good standing under the laws of its
jurisdiction of organization and has full entity power and authority to conduct
the GC Business conducted by it and to own, use and lease its Assets and
Properties. Each of the GC Entities is duly qualified or licensed to do business
and is in good standing in each jurisdiction where the nature of the GC Business
conducted by it or the Assets and Properties owned or leased by it makes such
qualification or license necessary, except where the failure to be qualified or
licensed (individually or in the aggregate) would not have a Material Adverse
Effect.
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3.02 CAPITALIZATION.
(a) The authorized capital stock of the Reorganized Debtors, including
with respect to the New GCX Stock, will be set forth in the Amended and Restated
Certificate of Incorporation or Charter of such Reorganized Debtor as of the
Effective Date.
(b) The authorized capital stock of GC International consists of 3,000
shares of common stock, no par value per share, all of which shares are issued
and outstanding and are owned by GCX, free and clear of all Liens except for
Liens arising under the DIP Facility and the Reimbursement Agreement. There are
no outstanding Options with respect to GC International or agreements,
arrangements or understandings to issue Options with respect to the GC
International, and there are no preemptive rights or agreements, arrangements or
understandings to issue preemptive rights with respect to the issuance or sale
of GC International capital stock.
(c) The authorized capital stock of GCC Investments consists of 100
shares of common stock, no par value per share, 10 of which shares are issued
and outstanding and are owned by GCX, free and clear of all Liens except for
Liens arising under the DIP Facility. There are no outstanding Options with
respect to GCC Investments or agreements, arrangements or understandings to
issue Options with respect to the GCC Investments, and there are no preemptive
rights or agreements, arrangements or understandings to issue preemptive rights
with respect to the issuance or sale of GCC Investments capital stock.
(d) The authorized capital stock of each of the GC Non-Debtors
(excluding GC International) is set forth in the Organizational Documents
included in the Data Room Index, and such Organizational Documents have not been
amended or modified and remain in full force and effect. The issued and
outstanding capital stock of the GC Non-Debtors (excluding GC International) are
owned as set forth on the Organizational Chart, free and clear of all Liens
except under the DIP Facility and the Reimbursement Agreement. There are no
outstanding Options with respect to any capital stock of the GC Non-Debtors
(excluding GC International) or agreements, arrangements or understandings to
issue Options with respect thereto, and there are no preemptive rights or
agreements, arrangements or understandings to issue preemptive rights with
respect to the issuance or sale of the GC Non-Debtors' (excluding GC
International) capital stock.
(e) The authorized capital stock of each of the SA Joint Venture
Entities is set forth in the Organizational Documents listed in the Data Room
Index, and such Organizational Documents have not been amended or modified and
remain in full force and effect. The issued and outstanding capital stock of the
SA Joint Venture Entities are owned as set forth on the Organizational Chart,
free and clear of all Liens except the Liens of the SA Lenders against certain
stock of GCC Hoyts Chile, Inc., Hoyts Cinemas Chile SA, Boca Holdings, Inc. and
Hoyts General Cinema de
15
Argentina, S.A. Except as provided by Data Room Index, there are no outstanding
Options with respect to or agreements, arrangements or understandings to issue
Options with respect thereto, and there are no preemptive rights or agreements,
arrangements or understandings to issue preemptive rights with respect to the
issuance or sale of the SA Joint Venture Entities' capital stock.
3.03 AUTHORIZATION AND ENFORCEABILITY. The Seller has the full
corporate power and authority to execute and deliver this Agreement, to perform
its obligations hereunder and to consummate the Transaction. The execution,
delivery and performance of this Agreement by the Seller and the consummation by
the Seller of the Transaction has been duly and validly approved by the Seller,
and no other corporate action on the part of any Seller is necessary to
authorize the execution, delivery and performance of this Agreement and the
consummation of the Transaction. This Agreement has been duly and validly
executed and delivered by each Seller and constitutes the legal, valid and
binding obligation of the Seller enforceable against the Seller in accordance
with its terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
other similar laws relating to the enforcement of creditors' rights generally
and by general principles of equity.
3.04 CORPORATE STRUCTURE. Except as shown on the Organizational Chart,
as disclosed by Data Room Index and the Investment Assets, no GC Entity holds
any equity, partnership, limited liability company, joint venture or other
interest in any other Person. The minute books and other similar records of the
Seller and GC Entities as provided pursuant to Data Room Index contain true and
complete records, in all material respects, of all actions taken at all meetings
and by all written consents in lieu of meetings of the stockholders or members
(as the case may be), the board of directors and any committee of the board of
directors of each of the GC Entities.
3.05 NO CONFLICTS. Subject to confirmation of the Plan by the
Bankruptcy Court, the execution and delivery by the Seller of this Agreement,
the performance by the Seller of its obligations under this Agreement, and the
consummation of the Transaction does not and will not, except in each case where
such conflict, breach or Lien creation individually or in the aggregate would
not be reasonably expected to have a Material Adverse Effect: (a) conflict with
or result in a violation or breach of any of the terms, conditions or provisions
of Organizational Documents of any GC Entity; (b) conflict with or result in a
violation or breach of any term or provision of any Law or Order applicable to
any GC Entity or any of GC Entities' Assets and Properties; (c) conflict with or
result in a violation or breach of, constitute (with or without notice or lapse
of time or both) a default under, require any GC Entity to obtain any consent,
approval or action of, make any filing with or give any notice to, any Person as
a result or under the terms of, or result in or give to any person any right of
termination, cancellation, acceleration or modification in or with respect to,
any material Contract or Permit to which any GC Entity is a party or by which
its respective Assets and Properties are bound (which for purposes hereof shall
exclude any executory contract or unexpired lease listed in the Contract
Schedule that is rejected pursuant to the Plan); or (d) result
16
in the creation or imposition of any Lien upon the Purchased Shares or any Lien
upon the Assets and Properties of any of the GC Entities.
3.06 GOVERNMENTAL APPROVALS AND FILINGS. Except for expiration or early
termination of the waiting period under the HSR Act, confirmation of the Plan by
the Bankruptcy Court and certain consent and approvals that may be needed to
transfer certain liquor licenses, no consent, approval or action of, filing with
or notice to, any Governmental or Regulatory Authority on the part of any GC
Entity is required in connection with the execution, delivery and performance of
this Agreement or the consummation of the Transaction.
3.07 SEC DOCUMENTS. Since October 31, 1997, GCX has timely filed all
reports, schedules, forms, statements and other documents required to be filed
by GCX with the Securities and Exchange Commission ("SEC") pursuant to the
reporting requirements of the Securities Exchange Act of 1934, as amended (the
"EXCHANGE ACT") (all of the foregoing filed prior to the date hereof and after
October 31, 1997, and all exhibits included therein and the financial statements
and schedules thereto and documents incorporated by reference therein, the "SEC
DOCUMENTS"). As of their respective date or as heretofore amended, the SEC
Documents complied in all material respects with the reporting requirements of
the Exchange Act or with the requirements of the Securities Act of 1933 with
respect to documents filed thereunder.
3.08 FINANCIAL STATEMENTS. The Seller has furnished or made available
to the Purchasers true and complete copies of the following financial
statements: (a) the audited consolidated financial statements of GCX and its
Subsidiaries included in GCX's Annual Report on Form 10-K for the fiscal year
ended October 31, 2000, with the report thereon of GCX's independent auditor
(the "AUDITED FINANCIAL STATEMENTS"); (b) the quarterly unaudited consolidated
financial statements of GCX and its Subsidiaries included in GCX's Quarterly
Reports on Form 10-Q for the fiscal quarters ended January 31, 2001, April 30,
2001 and July 31, 2001 (the "QUARTERLY STATEMENTS"); and (c) unaudited
theatre-by-theatre profit and loss statements for the nine month period ended
July 31, 2001 (collectively, the "DOMESTIC FINANCIAL STATEMENTS"). All of the
Domestic Financial Statements are true and correct in all material respects and
were prepared from the books of account or other financial records of the GC
Entities. The Audited Financial Statements and Quarterly Financial Statements
(i) have been prepared in accordance with GAAP and the published rules and
regulations of the SEC applicable thereto applied on a consistent basis, except
as may be indicated in the notes thereto and except, in the case of unaudited
Financial Statements, year-end adjustments and (ii) fairly present the
consolidated financial position of the GC Entities included in each such
Domestic Financial Statement.
The Seller has also furnished or made available to the Purchasers true
and complete copies of the following financial statements of the SA Joint
Venture: (a) the audited consolidated financial
17
statements of the SA Joint Venture in each country that it operates for the year
ended [DECEMBER 31, 2000], with the report thereon of the SA Joint Venture's
independent auditor (the "SA AUDITED FINANCIAL STATEMENTS"); and (b) the
unaudited financial statements and comparison to budget of the SA Joint Venture
for the year to date ended September 30, 2001 (the "SA INTERIM FINANCIAL
STATEMENTS") (collectively, the "SA FINANCIAL STATEMENTS"). All of the SA
Financial Statements are true and correct in all material respects, were
prepared from the books of account or other financial records of the SA Joint
Venture Entities and fairly present the consolidated financial position of the
SA Joint Venture Entities included in each such SA Financial Statement. The SA
Audited Financial Statements have been prepared in accordance with generally
accepted accounting principles of the country to which such statements relate
applied on a consistent basis, except as may be indicated in the notes thereto.
3.09 ABSENCE OF CHANGES. Since the Last Statement Date, the GC Entities
have been operated in all material respects in the Ordinary Course of Business
and there has not been any change or any event or development which,
individually or together with other such events or development, has had a
Material Adverse Effect. In addition, without limiting the foregoing, except in
the Ordinary Course of Business or except as otherwise expressly contemplated by
this Agreement or the Interim Operating Agreement or otherwise disclosed in
writing to the Purchasers, there has not occurred since the Last Statement Date:
(a) any amendment or change to the Organizational Documents of the GC
Entities;
(b) any direct or indirect redemption, purchase or other acquisition by
any GC Entity of any equity securities of any other GC Entity;
(c) any authorization, issuance, sale or other dispositions by any GC
Entity of any shares of capital stock of any other GC Entity, or any Option
relating to such capital stock or any modification or amendment of any right
of any holder of any outstanding shares of capital stock of any GC Entity;
(d) except for GCX's Bankruptcy Court approved severance and retention
or incentive programs, (i) any increase in the salary or bonus of any director
or officer of the GC Entities, other than salary increases in the Ordinary
Course of Business, (ii) any payment of consideration of any nature whatsoever
(other than salary, bonus or dividend equivalent salary paid in the Ordinary
Course of Business) to any officer, director or stockholder of any of the GC
Entities, (iii) any grant of any severance, continuation or termination pay to
any director, officer, stockholder or employee of the GC Entities, or (iv) any
adoption, entering into, amendment, modification or termination (partial or
complete) of any Employee Plan or employment contract with respect to any
director, officer or stockholder of the GC Entities;
18
(e) except for under the DIP Facility, (i) any incurrence by any GC
Entity of any Indebtedness or (ii) any voluntary purchase, cancellation,
prepayment or complete or partial discharge in advance of a scheduled payment
date with respect to, or written waiver of any right of any GC Entity under, any
Indebtedness owing to any GC Entity;
(f) any physical damage, destruction or other casualty loss (whether or
not covered by insurance) affecting any of the GC Entities' Assets and
Properties in an aggregate amount exceeding $100,000;
(g) excluding with respect to the SA Joint Venture, any write-off or
write-down of or any determination to write off or write down any of the Assets
and Properties of the GC Entities in an aggregate amount exceeding $5,000,000;
(h) any purchase of any material Assets and Properties of any GC Entity
or any sale, license or other disposition of, or incurrence of a Lien (other
than a Permitted Lien) on, any material Assets and Properties of the GC
Entities;
(i) except for the documents and agreements listed in the Data Room
Index and except pursuant to the Plan, any entering into any amendment,
modification, termination (partial or complete) or granting of a written waiver
under (i) any material Contract or (ii) any material Permit held by any of the
GC Entities;
(j) any capital expenditures or commitments for additions to property,
plant or equipment of any of the GC Entities constituting capital assets in an
aggregate amount exceeding $25,000.
(k) any transaction by any of the GC Entities with any officer,
director, stockholder, Affiliate or Associate of any of the GC Entities other
than (i) any transaction that would not constitute a breach of subsection (d) or
(e) above, or (ii) pursuant to any Contract listed within the Data Room Index;
(l) the commencement of any Action or Proceedings against, or
investigation of, any of the GC Entities or their respective affairs (of which
any of the GC Entities has received written notice);
(m) written notice of any claim of ownership by a third party of any of
the GC Entities' Intellectual Property or written notice of infringement by any
of the Seller or GC Entities of any third party's Intellectual Property rights;
19
(n) any loan or advance by any of the GC Entities to any Person, except
for advances to employees for travel and business expenses;
(o) any material change in the accounting method or procedures of any
of the GC Entities, or
(p) any entering into of an agreement to do or engage in any of the
foregoing, including any Business Combination not otherwise restricted by the
foregoing paragraphs.
3.10 NO UNDISCLOSED LIABILITIES. Except as reflected or reserved
against in the Financial Statements or as disclosed in the Schedule of Assets
and Liabilities filed with respect to the Debtors in the Chapter 11 Cases or as
disclosed in the Data Room Index, there are no Liabilities of any of the GC
Entities or relating to or affecting any of their Assets and Properties required
to be reflected in Financial Statements in accordance with GAAP, other than
Liabilities incurred in the Ordinary Course of Business since the Last Statement
Date.
3.11 LEGAL PROCEEDINGS. Except as disclosed by Data Room Index: (a)
there are no Actions or Proceedings pending against any GC Entity or any of the
respective Assets and Properties; (b) there are no Orders outstanding against
any GC Entity; and (c) there have been no notices, complaints or other forms of
written inquiry received by any GC Entity from any Governmental or Regulatory
Authority charged with the regulation of any of the GC Entities' respective
operations and affairs, the adverse determination of which, individually or in
the aggregate, would reasonably be expected to have a Material Adverse Effect.
3.12 COMPLIANCE WITH LAWS AND ORDERS. Except as disclosed under Data
Room Index, none of the GC Entities is in violation of or in default under any
Law or Order applicable to such GC Entity or any of their respective Assets and
Properties that would reasonably be expected to have a Material Adverse Effect.
3.13 EMPLOYEE PLANS.
(a) Except as described in Section 5.05 hereof, set forth in Data Room
Index is a complete and correct list of all Employee Plans maintained or
contributed to by the GC Entities or any ERISA Affiliate or pursuant to which
the GC Entities or any ERISA Affiliate may have any Liability or covering
employees or former or retired employees of the GC Entities ("EMPLOYEES") with
respect to their employment with the GC Entities. Except as disclosed in Data
Room Index, each such Employee Plan is in writing and true and complete copies
of the following items relating to each Employee Plan, where applicable, have
heretofore been furnished or made available to Purchasers: (i) the Employee Plan
and any trust, custodial or other funding agreement, including all amendments
thereto: (ii) the three most recent actuarial reports and annual reports filed
with any
20
relevant Governmental or Regulatory Authority for the three (3) most recent plan
years; (iii) the most recent summary plan description, summary of material
modifications to such summary plan descriptions and all material Employee
communications relating to such Employee Plans distributed within the last 12
months; and (iv) the most recent custodian or trustee reports or other financial
statement for funded Employee Plans.
(b) No oral or written promise, commitment or representation has been
made by any GC Entity (i) to amend any of the Employee Plans or to provide
increased benefits thereunder to any of the GC Entities' present or former
employees, independent contractors, directors, officers or shareholders, except
pursuant to the requirements, if any, of the Employee Plans, any collective
bargaining agreements or as otherwise provided in this Agreement or the Plan,
(ii) to establish any new Employee Plan or (iii) to fund or continue any
Employee Plan beyond the Effective Date. To the Seller's Knowledge, each
Employee Plan can be terminated on or immediately after the Effective Date
without making any additional contribution to such Employee Plan other than
normal contributions with respect to the 2002 plan year prorated through the
Effective Date.
(c) Each Employee Plan has been maintained, operated and administered
in compliance with its terms and all related documents or agreements and in
compliance with all applicable Laws, except where the failure to comply would
not have a Material Adverse Effect. Each Employee Plan that is an "employee
pension benefit plan" within the meaning of ERISA Section 3(2) is a qualified
plan under Tax Code Section 401, and nothing has occurred with respect to such
plan that would cause the loss of such qualification. Without limiting the
foregoing, the Seller has amended the GC Companies, Inc. Retirement Plan
(effective December 16, 1993) and the GC Companies, Inc. 401(k) Savings Plan
(Amended and Restated effective September 1, 1999) to comply with the statutory
changes applicable thereto known as "GUST" and shall has submitted the plans to
the IRS for favorable determination letters. Any non-compliance or failure
properly to administer a Plan or related trust or fund has not exposed such
Employee Plan or related trust or fund or any GC Entity, nor would it be
reasonably likely to result in any exposure of the Purchasers or the GC
Entities, to any Taxes, penalties or Liabilities to any Person or expose the
Employee Plan to disqualification of the trust or fund or to loss of tax exempt
status.
(d) There have been, as of the Effective Date, no prohibited
transactions as described in Tax Code Section 4975 or Title I, Part 4 of ERISA
involving any Employee Plan. The Seller is not aware of any facts or
circumstances that could give rise to any Tax imposed by Tax Code Section 4975
with respect to any Employee Plan. There is no pending or, to the Knowledge of
Seller, threatened claim (other than claims for benefits in the ordinary
course), assessment, complaint, proceeding or investigation of any kind before
any Governmental or Regulatory Authority with respect to any Employee Plan.
21
(e) All insurance premiums required with respect to any Employee Plan
up to the Effective Date have been or shall be paid on or prior to the Effective
Date and, with respect to any such insurance policy, there shall be no Liability
of any of the GC Entities in the nature of a retroactive rate adjustment, loss
sharing arrangement or other actual or contingent Liability arising wholly or
partially out of events occurring prior to the Effective Date.
(f) All benefits, expenses and other amounts due and payable to or
under any Employee Plan on or prior to the Effective Date and all contributions
(including Employee contributions), transfers or payments required to be made to
any Employee Plan on or prior to the Effective Date, have been paid or shall be
paid prior to the Effective Date.
(g) No Employee Plan provides benefits, including without limitation
death or medical benefits, beyond termination of service or retirement other
than (i) coverage mandated by Law or (ii) as disclosed in Data Room Index.
(h) Except as disclosed in Data Room Index, no GC Entity maintains or
participates in, nor is obligated to contribute to, nor has ever maintained or
participated in, nor been obligated to contribute to, any "MULTIEMPLOYER PLAN"
within the meaning of Section 3(37) of ERISA or any "defined benefit pension
plan" within the meaning of ERISA Section 3(35).
(i) The Audited Domestic Financial Statements fully and accurately
reflect all unfunded Liability under, in connection with or relating to the
Employee Plans.
3.14 REAL PROPERTY.
(a) Data Room Index Item XI and the GC Companies list of active theatre
and office properties, dark leased properties and inactive owned properties
attached hereto as Exhibit C contains a true and correct list, as of the date of
this Agreement, of all real property owned, leased, subleased or otherwise
occupied by any the GC Entities (as lessor or lessee), together with a brief
description of the location thereof (the "REAL PROPERTY", and the leases or
subleases relating thereto, including any amendments and renewal letters, are
herein called the "REAL PROPERTY LEASES"). Each of the Real Property Leases
provided for review by the Purchasers' Representatives in the Data Room was a
correct and complete copy of such Real Property Lease, and none of the Real
Property Leases has been amended or modified except as set forth in Data Room
Index.
(b) Subject to the terms of the Real Property Leases, the GC Entities
have a valid and subsisting leasehold estate in and the right to quiet enjoyment
of each of the Real Properties leased by them for the full term of the lease
thereof. Subject to assumption pursuant to the Plan of each Real Property Lease
not previously assumed by a GC Entity, each Real Property Lease is in full
22
force and effect and is a legal, valid and binding agreement, of the GC Entity
that is a party thereto, and, assuming that it is a legal, valid and binding
agreement of the other party thereto, is enforceable in accordance with its
terms against the parties thereto except as the enforceability thereof may be
limited by bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or other similar laws relating to the enforcement of creditors'
rights generally and by general principles of equity. Except for the Chapter 11
Cases, there is no material default by the GC Entities under any Real Property
Lease or, to the Knowledge of any of the GC Entities, any material default
thereunder by the other party thereto. None of the GC Entities owe brokerage,
commissions or finders fees with respect to any such Real Property Lease or
leased Real Property, except to the extent that the any of the GC Entities may
renew the term of any such Real Property Lease, in which case any such
commissions and fees would be in amounts that are reasonable and customary for
premises similar to those leased, given their intended use and terms. Since the
Last Statement Date, none of the GC Entities, has exercised any option or right
to (i) cancel or terminate any Real Property Lease, (ii) lease additional
premises, (iii) materially reduce or relocate the premises demised under any
Real Property Lease, (ii) lease additional premises, (iii) reduce or relocate
the premises demised under any Real Property Lease or (iv) purchase any real
property, which transaction is pending.
(c) None of the GC Entities has received notice of any pending zoning
or other land-use regulation Actions or Proceedings applicable to the Real
Property that would have a Material Adverse Effect.
3.15 TANGIBLE PERSONAL PROPERTY. The GC Entities are in possession of
and have good and marketable title to, or have valid leasehold interests in or
valid rights under contract to use, all material tangible personal property used
in the conduct of their respective businesses, including all tangible personal
property reflected on the Financial Statements for the period ended on the Last
Statement Date and tangible personal property acquired since that date, other
than property disposed of since such date in the Ordinary Course of Business.
All such tangible personal property is free and clear of all Liens, other than
Permitted Liens or as disclosed in Data Room Index.
3.16 INTELLECTUAL PROPERTY RIGHTS.
(a) Data Room Index is a GC Companies, Inc. Trademark Status Report and
lists all of the GC Entities United States or foreign registrations or
applications issued by, filed with or recorded by any Governmental or Regulatory
Authority as of the date listed on such report; all of such registrations and
applications are in full force and effect and all necessary registration,
maintenance and renewal fees in connection therewith have been paid and all
necessary documents and certificates in connection therewith have been filed
with the relevant patent, copyright, trademark or other authority in the United
States or foreign jurisdictions, as the case may be, for
23
the purpose of maintaining the registrations or applications for registration of
such Intellectual Property, except as otherwise disclosed in such report. All
the Intellectual Property owned by the GC Entities is free and clear of any and
all Liens, other than Permitted Liens or the lien imposed by any license or
other permission to use itself. None of the GC Entities has any Knowledge that
such Intellectual Property is being infringed by any other Person or that the GC
Entities are infringing any Intellectual Property of any other Person. As of the
date of this Agreement, no material claim is pending or, to the Knowledge of any
GC Entity, threatened to such effect or with respect to the ownership, validity,
license or use of, or any infringement resulting from, the GC Entities'
Intellectual Property.
(b) All material licenses, agreements and permissions pertaining to
Intellectual Property owned, licensed or otherwise used by the GC Entities (the
"INTELLECTUAL PROPERTY AGREEMENTS") are contained in the Data Room Index and
have been made available to the Purchasers' Representatives. The consummation of
the transactions contemplated by this Agreement will neither violate nor result
in the breach, modification, cancellation, termination or suspension of the
Intellectual Property Agreements and the GC Entities are in compliance with, and
have not breached any term of, the Intellectual Property Agreements and, to the
Knowledge of the Seller, all of the other parties to such Intellectual Property
Agreement are in compliance with, and have not breached, any of the terms
thereof. Each GC Entity owns all right, title and interest in and to, or has
rights sufficient to use, as currently used by such GC Entity, to all
Intellectual Property used the GC Entities.
3.17 CONTRACTS.
(a) The Data Room Index and the Contracts Schedule contains a correct
and complete list of each of the following Contracts or other arrangements
(correct and complete copies or, if not in writing, reasonably complete and
accurate written descriptions of which, together with all material amendments
and supplements thereto and all written waivers of any terms thereof were
furnished or made available to the Purchasers' Representatives in the Data Room
or, with respect to Contracts not listed in the Data Room Index, upon the
Purchasers' request), to which any GC Entity is a party or by which any of its
Assets and Properties is bound, including:
(i) (A) all Contracts providing for a commitment of employment
or consultation services for a special term that involve the payment or
potential payment pursuant to the terms of any GC Entity of more than
$100,000 and that are not cancelable without penalty within ninety (90)
days and (B) all Contracts involving an obligation of any GC Entities
to make material severance or other payments (with or without notice,
passage of time or both) to any Person in connection with, or as a
consequence of, the transactions contemplated hereby or to any
employee, other than with respect to salary payments in the Ordinary
Course of Business;
24
(ii) all Contracts with any Person containing any provision or
covenant prohibiting or limiting the ability of any Seller or GC Entity
to engage in any business activity or compete with any Person or
prohibiting or limiting the ability of any Person to compete with the
Seller or GC Entity.
(iii) all partnership, joint venture, shareholders' or other
similar Contracts with any Person;
(iv) all material Contracts with independent contractors,
sales agents, insurance agents, insurance brokers, and other types of
insurance producers and distributors;
(v) all material Contracts relating to any prospective
Business Combination;
(vi) all material Contracts between or among any GC Entity, on
the one hand, and any current or former officer, director, stockholder,
Affiliate or Associate of any Seller or GC Entity, or any Associate of
any such officer, director, stockholder or Affiliate on the other hand;
(vii) all collective bargaining Contracts;
(viii) all leases of material personal property;
(ix) any Contract or series of related Contracts that involves
receipts, expenditures, performance of services or delivery of goods or
material by the GC Entities of an amount or value in excess of $20,000,
except for film licensing contracts and orders for trade goods,
services and supplies in the Ordinary Course of Business;
(x) any fidelity or surety bond;
(xi) all Contracts that (A) limit or contain restrictions on
the ability of the GC Entities to declare or pay dividends on, to make
any other distribution in respect of, or to issue or purchase, redeem
or otherwise acquire, its capital stock, to incur Indebtedness, to
incur or suffer to exist any Lien, to purchase or sell any Assets and
Properties, to change the lines of business in which it participates or
engages or to engage in any Business Combination, (B) require any GC
Entity to maintain specified financial ratios or levels of net worth or
other indicia of financial condition or (C) require any GC Entity to
maintain insurance in certain amounts or with certain coverages;
(xiii) all powers of attorney or comparable delegations of
authority; and
25
(xiv) all other Contracts or series of related Contracts that
involve the payment or potential payment pursuant to the terms of any
such Contract by the GC Entity of more than $50,000 for a term longer
than six months from the date of this Agreement and that are not
cancelable without penalty upon the GC Entity giving at least 30 days
notice.
(b) Subject to the Chapter 11 Cases, each Contract required to be
disclosed in the Data Room Schedule pursuant to subsection (a) above is in full
force and effect and is a legal, valid and binding agreement of the GC Entities
party thereto, and, assuming that it is a legal, valid and binding agreement of
the other party thereto, is enforceable in accordance with its terms against the
parties thereto, except as the enforceability thereof may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
other similar laws relating to the enforcement of creditors' rights generally
and by general principles of equity and except for such Contracts, the
non-enforceability of which would not reasonably be expected to have a Material
Adverse Effect. Subject to the Chapter 11 Cases, there is no default by the GC
Entity party thereto under any such Contract nor, to the Knowledge of the
Seller, any default thereunder by the other party thereto that would reasonably
be expected to have a Material Adverse Effect.
3.18 PERMITS AND LICENSES. The Data Room Index contains a true and
complete list of all material Permits issued to the GC Entities, as of the date
of this Agreement, setting forth the owner, the function and the expiration and
renewal date of each. Each such Permit is in full force and effect; and none of
the GC Entities is in default (or with the giving of notice or lapse of time or
both, would be in default) under any such Permit, except where such default
would not result in a Material Adverse Effect.
3.19 INSURANCE. The Data Room Index contains a correct and complete
list of all liability, property, workers' compensation, fidelity, directors' and
officers' liability, social, welfare pension and other insurance policies in
effect on the date of this Agreement that are issued to the GC Entities and that
insure the business, operations or employees of the GC Entities. The insurance
coverage provided by the policies issued to the GC Entities will not terminate
or lapse by reason of the Transaction. Each such policy is in full force and
effect, all premiums due thereunder have been paid when due and no GC Entity has
received any notice of cancellation or termination in respect of any such policy
or is in default thereunder. To the Knowledge of the Seller, no insurer under
any policy referred to in this Section is denying liability with respect to a
claim thereunder or defending under a reservation of rights clause.
3.20 RELATED PARTY TRANSACTIONS. Except for intercompany payables,
there is no Indebtedness between any of the GC Entities on the one hand, and any
officer, director, stockholder (including any GC Entity), Affiliate or Associate
of any of the GC Entities, or any Associate of any such officer, director,
stockholder or Affiliate, on the other hand, (b) none of the
26
GC Entities provides any assets, services or facilities to any such officer,
director, stockholder (including any GC Entity) or any such Affiliate or
Associate, (c) no officer, director, stockholder (including any GC Entity) or
any such Affiliate or Associate has any interest, directly or indirectly, in any
entity which furnishes or sells any goods or services or provides any facilities
to any Affiliate, except that ownership of no more than 5% of the outstanding
capital stock of a publicly traded corporation shall not be deemed to be an
interest for the purposes of this Section 3.20.
3.21 EMPLOYEES; LABOR RELATIONS. Except as disclosed by the Data Room
Index, no unfair labor practice complaint or sex or age discrimination or
harassment claim is pending against the GC Entities before any Governmental or
Regulatory Authority. There has been no material work stoppage or strike by
employees of any of the GC Entities, and to the Seller' Knowledge, none have
been threatened.
3.22 ENVIRONMENTAL MATTERS. Except as disclosed under the Data Room
Index:
(a) All of the Assets and Properties (including underlying groundwater)
owned or leased by the GC Entities have been, and continue to be, owned or
leased by the GC Entities in material compliance with all Environmental, Health
and Safety Requirements.
(b) There have been no past, and there are no pending or threatened
(i) claims, complaints, notices or requests for
information received by any of the GC Entities with
respect to any alleged violation of any
Environmental, Health and Safety Requirement that,
singly or in the aggregate, would reasonably be
expected to have a Material Adverse Effect, or
(ii) complaints, notices or inquiries to any of the GC
Entities regarding potential liability under any
Environmental, Health or Safety Requirement that,
singly or in the aggregate, would reasonably be
expected to have a Material Adverse Effect.
(c) There have been no releases of hazardous materials at, on or under
any property now or previously owned or leased by any GC Entity that, singly or
in the aggregate, have or may be reasonably be expected to have a Material
Adverse Effect.
(d) No property now or previously owned or leased by any GC Entity is
listed or proposed for listing on the National Priorities List pursuant to
CERCLA or, to the Seller's Knowledge, on the CERCLIS or any similar federal or
state list of sites requiring investigation or clean-up under any Environmental,
Health or Safety Requirement.
27
(e) There are no underground storage tanks, active or abandoned,
including petroleum storage tanks, on or under any property now or previously
owned or leased by any GC Entity that, singly or in the aggregate, have or may
be reasonably be expected to have a Material Adverse Effect.
(f) None of the GC Entities has directly transported or directly
arranged for the transportation of any hazardous material to any location that
is listed or proposed for listing on the National Priorities List pursuant to
CERCLA, on the CERCLIS or on any similar federal or state list or that is the
subject of federal, state or local enforcement actions or other investigations,
which may lead to material claims against any GC Entity for any remedial work,
damage to natural resources or personal injury, including claims under CERCLA.
(g) There are no polychlorinated biphenyls or friable asbestos
present at any property now or previously owned or leased by any GC Entity that,
singly or in the aggregate, have or may be reasonably be expected to have a
Material Adverse Effect.
(h) No conditions exist at, on or under any property now or
previously owned or leased by any GC Entity that, with the passage of time, the
giving of notice or both, would give rise to liability under any Environmental,
Health and Safety Requirement that, singly or in the aggregate, have or may be
reasonably be expected to have a Material Adverse Effect.
3.23 OTHER NEGOTIATIONS; BROKERS. No agent, broker, finder,
investment banker, financial advisor or other similar third party will be
entitled to any fee, commission or other compensation from any GC Entity in
connection with the Transaction based upon arrangements made by or on behalf of
the Seller.
3.24 BANK AND BROKERAGE ACCOUNTS. The Data Room Index sets forth:
(a) a true and complete list of the names and locations of all banks, trust
companies, securities brokers and other financial institutions at which the GC
Entities have an account or safe deposit box or maintains a banking, custodial
or trading relationship, and (b) a true and complete list and description of
each such account, box and relationship, indicating in each case the account
number.
3.25 TAX With respect to each GC Entity, except as would not
reasonably be expected to have a Material Adverse Effect: (i) all Tax Returns
required to be filed on or before the Effective Date by it with respect to any
Taxes have been timely filed with the appropriate governmental agencies in all
jurisdictions in which such Tax Returns are required to be filed, and all such
Tax Returns correctly reflect, in all material respects its liability for Taxes
for the periods, properties, or events covered thereby; (ii) all Taxes payable
with respect to the Tax returns referred to in the preceding clause, all Taxes
accruable prior to the Effective Date, whether disputed or not, whether or not
shown on any Tax Return, and whether or not currently due or payable, will have
28
been paid in full prior to the Effective Date, or an adequate accrual will have
been made in accordance with GAAP; (iii) Seller have no Knowledge of any
unassessed Tax deficiencies or of any audits or investigations pending or
threatened against it with respect to any Taxes; (iv) there is in effect no
extension for the filing of any Tax Return and it has not extended or waived the
application of any statute of limitations of any jurisdiction regarding the
assessment or collection of any Tax; (v) no claim has ever been made by any Tax
authority in a jurisdiction in which it does not file Tax returns that it is or
may be subject to taxation by that jurisdiction; (vi) there are no Liens for
Taxes upon any of its assets except for Permitted Liens; and (vii) it has timely
made all deposits required by Law to be made with respect to employees
withholding and other payroll, employment, or other withholding Taxes, including
the portions of such Taxes imposed upon it.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PURCHASERS
Each Purchaser hereby represents and warrants to each Seller as
follows:
4.01 ORGANIZATION. Each of the Purchasers is duly organized,
validly existing and in good standing under the laws of its jurisdiction of
organization and has full entity power and authority to conduct its business and
to own, use and lease its Assets and Properties.
4.02 AUTHORITY. Each of the Purchasers has the full corporate power
and authority to execute and deliver this Agreement, to perform its obligations
hereunder, and to consummate the Transaction. The execution, delivery and
performance of this Agreement by each Purchaser and the consummation by each
Purchaser of the Transaction has been duly and validly approved by the Board of
Directors of each Purchaser and by AMCE's preferred stockholder, and no other
corporate action on the part of any Purchaser is necessary to authorize the
execution, delivery and performance by any Purchaser of this Agreement and the
consummation by any Purchaser of the Transaction. This Agreement has been duly
and validly executed and delivered by each Purchaser and constitutes the legal,
valid and binding obligation of such Purchaser enforceable against such
Purchaser in accordance with its terms, except as the enforceability thereof may
be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or other similar laws relating to the enforcement of creditors'
rights generally and by general principles of equity.
4.03 NO CONFLICTS. Subject to confirmation of the Plan by the
Bankruptcy Court, the execution and delivery by each Purchaser of this
Agreement, the performance by each Purchaser of its obligations under this
Agreement, and the consummation of the Transaction does not and will not, except
in each case where such conflict, breach or Lien creation individually or in the
aggregate would not be reasonably expected to have a Material Adverse Effect:
(a) conflict with or result in a violation or breach of any of the terms,
conditions or provisions of Organizational Documents of
29
such Purchaser; (b) conflict with or result in a violation or breach of any term
or provision of any Law or Order applicable to such Purchaser or any of its
Assets and Properties; (c) conflict with or result in a violation or breach of,
constitute (with or without notice or lapse of time or both) a default under,
require such Purchaser to obtain any consent, approval or action of, make any
filing with or give any notice to, any Person as a result or under the terms of,
or result in or give to any person any right of termination, cancellation,
acceleration or modification in or with respect to, any material Contract or
Permit to which any such Purchaser is a party or by which its respective Assets
and Properties are bound; or (d) result in the creation or imposition of any
Lien upon any of the Assets and Properties of such Purchaser.
4.04 LEGAL PROCEEDINGS . Except for the objection of Fleet National
Bank, N.A. and the Acting U.S. Trustee entered in the Chapter 11 Cases, there
are no Actions or Proceedings pending against such Purchaser or any of its
Assets and Properties which (a) could reasonably be expected to result in the
issuance of an Order restraining, enjoining or otherwise prohibiting or make
illegal the consummation of any of the Transaction or (b) could reasonably be
expected, individually or in the aggregate with other such Actions or
Proceedings, to have a Material Adverse Effect on the ability of the Purchasers
to consummate the Transaction or to hinder or delay such consummation.
4.05 FINANCING. The Purchasers have sufficient cash or cash
equivalents on hand or available under its revolving credit facility to fund the
cash requirements of the Plan.
4.06 NEW AMCE STOCK . Upon issuance and delivery of the New AMCE
Stock as contemplated by the Plan, such New AMCE Stock will be duly authorized,
validly issued, fully paid and non-assessable, free of all preemptive or similar
rights.
4.07 SEC DOCUMENTS. Since October 31, 1997, AMCE has timely filed
all reports, schedules, forms, statements and other documents required to be
filed by AMCE with the SEC pursuant to the reporting requirements of the
Exchange Act (all of the foregoing filed prior to the date hereof and after
October 31, 1997, and all exhibits included therein and the financial statements
and schedules thereto and documents incorporated by reference therein, the "AMCE
SEC DOCUMENTS"). As of their respective date or as heretofore amended, the AMCE
SEC Documents complied in all material respects with the reporting requirements
of the Exchange Act or with the requirements of the Securities Act of 1933 with
respect to documents filed thereunder.
ARTICLE V
COVENANTS OF THE PARTIES
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5.01 CONDUCT OF BUSINESS PRIOR TO THE CLOSING. From the date hereof
until Closing, the Seller covenants and agrees to conduct the GC Business in the
Ordinary Course of Business and in accordance with the Interim Operating
Agreement, except as may be otherwise expressly provided for by this Agreement
or the Plan or by the Bankruptcy Court.
5.02 LOI PROVISIONS. From the date hereof until the Closing, the
binding provisions of the LOI in Section 3 (except for Section 3(c))thereof
shall remain in full force and effect.
5.03 NOTICE OF CERTAIN MATTERS. Each of the Seller and Purchasers
covenant and agree to give prompt notice in writing to the other. (a) if it
becomes actually aware that any representation or warranty of it contained
herein was not true and correct in any material respect as of the date hereof or
will not be true and correct in any material respect as of the Effective Date,
(b) if it becomes actually aware of the occurrence of any event which will
result in the failure to satisfy a condition specified in Article VI hereof, and
(c) of any written notice or other communication in writing from any third party
alleging that the consent of such third party is or may be required in
connection with the Transaction. The party giving such notice will use all
reasonable efforts, and shall be entitled to use, any and all efforts, to cure
any such inaccuracy or failure or to obtain such consent prior to the Closing.
5.04 FURTHER ACTION. Prior to the Closing, each of the parties
hereto shall execute and deliver such documents and other papers and take such
further actions as may be reasonably required or advisable to carry out the
provisions hereof and give effect to the Transaction.
5.05 SEVERANCE. Subject to Closing, the Reorganized Debtors will
provide severance benefits in accordance with GCX's existing severance policy to
GCX Home Office, National Office and VIP Ticket Office employees if (i) their
employment is terminated on the Effective Date, (ii) their employment is
terminated at a date beyond the Effective Date specified by the Reorganized
Debtors (in which case they must work the specified time period after the
Effective Date to be eligible for severance) or (iii) they are offered a
continuing position at their current compensation level, no later than June 30,
2002, but the position offered is not located in Boston and they choose within
two weeks after such offer not to accept the offer of employment. The provisions
of this Section shall supercede and replace that certain letter agreement
regarding severance dated December 6, 2001 between AMCE and GCX. In addition,
the provisions of AMCE's letter dated December 19, 2001 (a copy of which is
attached hereto as Exhibit D) delivered pursuant to Interim Operating Agreement
Section 2(r) shall be unaffected.
ARTICLE VI
CONDITIONS TO CLOSING
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6.01 CONDITIONS TO OBLIGATIONS OF SELLER. The obligations of Seller
to consummate the transactions contemplated by this Agreement shall be subject
to the fulfillment and satisfaction of each of the following conditions prior to
the Effective Date, excluding only such conditions as may be waived by Seller:
(a) REPRESENTATIONS AND WARRANTIES; COVENANTS. (i) The
representations and warranties of Purchasers contained in this Agreement shall
be true and correct in all material respects as of the Closing with the same
force and effect as if made as of the Closing (other than such representations
and warranties which address matters only as of a particular date, which shall
be true and correct in all material respects as of such date), except for
breaches that individually or in the aggregate would not reasonably be expected
to have a Material Adverse Effect, (ii) all of the covenants contained in this
Agreement to be complied with by Purchasers on or before the Closing shall have
been complied with before the Closing, except for breaches that individually or
in the aggregate would not reasonably be expected to have a Material Adverse
Effect, and (iii) Seller shall have received a certificate of the Purchasers to
such effect signed by a duly authorized officer thereof.
(b) LEGAL ACTION OR PROCEEDING. There shall be no Action or
Proceeding pending or threatened seeking to enjoin, restrain, prohibit or make
illegal or impose any materially adverse conditions in connection with, the
consummation of the Transaction.
(c) CONFIRMATION ORDER. The Plan shall have been confirmed by the
Bankruptcy Court and the Confirmation Order shall have become a Final Order.
(d) GOVERNMENTAL FILINGS AND CONSENTS. All governmental orders,
approvals and consents to the transactions contemplated by this Agreement
relating to the Transaction shall have been obtained and be in effect on the
Closing Date, except to the extent that the failure to obtain any such consent
would not be considered material by a reasonable seller or have the effect of
making the Transactions contemplated by this Agreement illegal or otherwise
prohibit consummation of such Transactions. Any applicable waiting periods
(including any extensions thereof) under the HSR Act relating to the Transaction
contemplated hereby shall have expired or otherwise been terminated.
(e) ADDITIONAL DOCUMENTATION. Each of the following documents must
have been delivered to Seller by the Purchasers:
(i) a certificate of each Purchaser's Secretary or an
Assistant Secretary certifying the resolutions of the Purchaser's Board
of Directors approving the Transaction and the names and signatures of
its officers authorized to sign this Agreement and any other document
required to be delivered hereunder;
32
(ii) a certificate certifying the accuracy of the
Purchasers' representations and warranties as described in Section
6.01(a) of this Agreement; and
(iii) such other documents as Seller may reasonably request
for the purpose of (A) evidencing the accuracy of any Purchasers'
representations and warranties, (B) evidencing the performance by
either Purchaser of, or the compliance by either Purchaser with, any
covenant or obligation required to be performed or complied with by
such Purchaser, (C) evidencing the satisfaction of any condition
referred to in this Section 6.01, or (D) otherwise facilitating the
consummation or performance of the Transaction.
6.02 CONDITIONS TO OBLIGATIONS OF PURCHASERS. The obligations of
the Purchasers to consummate the Transaction shall be subject to the fulfillment
and satisfaction of each of the following conditions prior to the Effective
Date, excluding only such conditions as may be waived by the Purchasers.
(a) REPRESENTATIONS AND WARRANTIES; COVENANTS. (i) The
representations and warranties of Seller contained in this Agreement shall be
true and correct in all material respects as of the Closing with the same force
and effect as if made as of the Closing (other than such representations and
warranties which address matters only as of a particular date, which shall be
true and correct in all material respects as of such date), except for breaches
that individually or in the aggregate would not reasonably be expected to have a
Material Adverse Effect (ii) all of the covenants contained in Article 5 of this
Agreement to be complied with by Seller on or before the Closing shall have been
complied with before the Closing, except for breaches that individually or in
the aggregate would not reasonably be expected to have a Material Adverse
Effect, and (iii) Purchasers shall have received a certificate of Seller to such
effect signed by Seller and a duly authorized officer thereof.
(b) LEGAL ACTION OR PROCEEDING. There shall be no Action or
Proceeding pending or threatened seeking to enjoin, restrain, prohibit or make
illegal or impose any materially adverse conditions in connection with, the
consummation of the Transaction, or shall otherwise have a Material Adverse
Effect.
(c) CONFIRMATION ORDER. The Plan shall have been confirmed by the
Bankruptcy Court and the Confirmation Order shall have become a Final Order.
(d) GOVERNMENTAL FILINGS AND CONSENTS. All governmental orders,
approvals and consents to the transactions contemplated by this Agreement
relating to the Transaction shall have been obtained and be in effect on the
Closing Date, except to the extent that the failure to obtain any such consent
would not be considered material by a reasonable seller or have the effect of
33
making the Transactions contemplated by this Agreement illegal or otherwise
prohibit consummation of such Transactions. Any applicable waiting periods
(including any extensions thereof) under the HSR Act relating to the Transaction
contemplated hereby shall have expired or otherwise been terminated.
(e) ADDITIONAL DOCUMENTATION. Each of the following documents must
have been delivered to Purchasers:
(i) a certified copy of the Amended and Restated
Certificate of Incorporation of GCX as filed with the Delaware
Secretary of State;
(ii) a certificate of the Seller's Secretary or an
Assistant Secretary certifying the resolutions of the Seller's Board of
Directors approving the Transaction and names and signatures of its
officers authorized to sign this Agreement and any other document
required to be delivered hereunder;
(iii) a certificate certifying the accuracy of the Seller's
representations and warranties as described in Section 6.02(a) of this
Agreement;
(iv) stock certificates evidencing the Purchased Shares,
duly endorsed to the appropriate Purchaser with all required stock
transfer tax stamps affixed or provided for in order to transfer such
Purchased Shares to Purchasers pursuant to this Agreement;
(v) certified copies of the Confirmation Order and the
docket in the Chapter 11 Cases demonstrating that the Confirmation
Order has become a Final Order of the Bankruptcy Court; and
(vi) such other documents as Purchasers may reasonably
request for the purpose of (A) evidencing the accuracy of the Seller's
representations and warranties, (B) evidencing the performance by the
Seller of, or the compliance by the Seller with, any covenant or
obligation required to be performed or complied with by the Seller, (C)
evidencing the satisfaction of any condition referred to in this
Section 6.02, or (D) otherwise facilitating the consummation or
performance of the Transaction.
(f) BANKRUPTCY ASSUMPTION; REJECTION. Each material executory
contract and unexpired lease (which includes all theatre leases) of any Debtor
not previously assumed, rejected or deemed to have been rejected shall have been
assumed, rejected or assumed and assigned to a GCX or AMCE Subsidiary designated
by AMCE, as determined by AMCE in its sole discretion, except (i) as otherwise
provided in the Plan or (ii) if the counterparty to such a contract or lease
objects to any such assignment and the Bankruptcy Court does not approve such
assignment. Each
34
such executory contract and unexpired lease shall have been assumed, rejected or
assumed and assigned, as the case may be, as designated by AMCE, by a Final
Order satisfactory to AMCE, which may be the Confirmation Order.
(g) LEASE AMENDMENTS. Each of the lease amendments referenced in
the table below shall have become effective:
PROPERTY STATUS OF AMENDMENT
-------------------------------- --------------------------------------------
Irving Mall, Irving, Texas (Unit Fully executed, but not effective until
984) Tenant assumes the Lease; but if the Lease
is not assumed on or before December 31,
2001, the Amendment is null and void.
Xxxxxx Creek, Austin, Texas Fully executed, but not effective until
(Unit 982) Tenant assumes the Lease; but if the Lease
is not assumed on or before December 31,
2001, the Amendment is null and void.
Xxxxxxxx Xxxxx, Philadelphia, Amendment is fully executed but not
Pennsylvania (Unit 965) effective until Tenant assumes Lease in
bankruptcy.
ARTICLE VII
TERMINATION
7.01 GROUNDS FOR TERMINATION. This Agreement may be terminated at
any time prior to the Closing:
(a) by mutual agreement of AMCE and GCX;
(b) by AMCE, if the Seller materially breaches this Agreement,
including (i) if the representations and warranties of the Seller are materially
incorrect; (ii) a material breach by the Seller of any of its covenants
contained in this Agreement; and (iii) if any of the conditions in Section 6.02
has not been satisfied as of the Effective Date and AMCE has not waived such
condition on or before the Effective Date, and the Seller fails to cure such,
and any one, of the breaches outlined above within thirty (30) days after AMCE
gives GCX written notice of such breach;
(c) by AMCE, if the Seller materially breaches the LOI, the
Interim Operating Agreement, the Plan or Bankruptcy Court order executed and or
entered, as applicable, in connection with the Transaction and Seller fail to
cure such, and any one, of the breaches outlined above within thirty (30) days
after AMCE gives GCX written notice of such breach;
35
(d) by GCX, if any of the Purchasers materially breaches this
Agreement, including (i) if the representations and warranties of the Purchasers
are materially incorrect; (ii) a material breach by any of the Purchasers of any
of its covenants contained in this Agreement; and (iii) if any of the conditions
in Section 6.01 has not been satisfied as of the Effective Date and GCX has not
waived such condition on or before the Effective Date, and Purchasers fail to
cure such, and any one, of the breaches outlined above within thirty (30) days
after GCX gives AMCE written notice of such breach;
(e) by GCX if any of the Purchasers materially breaches the LOI,
the Interim Operating Agreement, the Plan, or any Bankruptcy Court order
executed and or entered, as applicable, in connection with the Transaction and
Purchasers fail to cure such, and any one, of the breaches outlined above within
thirty (30) days after GCX gives AMCE written notice of such breach;
(f) by either party upon termination of the LOI or the Interim
Operating Agreement.
7.02 REMEDIES.
(a) EFFECT OF TERMINATION. If this Agreement is terminated as
permitted by Section 7.01, such termination shall be without liability of any
party to any other party to this Agreement except as provided within Section
3(f)(ii) of the LOI.
(b) SPECIFIC PERFORMANCE. The parties hereto recognize that any
breach of the terms of this Agreement may give rise to irreparable harm for
which money damages would not be an adequate remedy, and accordingly agree,
that, in addition to other remedies, the non-breaching party will be entitled to
enforce the terms of this Agreement by a decree of specific performance without
the necessity of proving the inadequacy of a remedy of money damages and without
the posting of any bond or other security.
ARTICLE VIII
MISCELLANEOUS
8.01 NONSURVIVAL OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties made herein or in any certificate, instrument or
document delivered pursuant hereto shall expire with and not survive beyond the
Closing and thereafter no party hereto or any shareholder, director, officer,
employee or Affiliate of such party shall be under any liability whatsoever
(whether under this Agreement or otherwise) with respect to any representations
or warranties.
36
8.02 NOTICES. All notices, requests and other communications
hereunder must be in writing and will be deemed to have been duly given only if
delivered personally against written receipt or by facsimile transmission or
mailed by prepaid first class certified mail, return receipt requested, or
delivered by a recognized overnight courier service prepaid, to the parties at
the following addresses or facsimile numbers:
(a) If to Purchasers, to:
AMC Entertainment Inc.
000 X. 00xx Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxx
Facsimile: (000) 000-0000
with a copy to (which will not itself constitute notice):
Xxxxxxx & Xxxx X.X.
0000 Xxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxx, Xx., Esq.
Facsimile: (000) 000-0000
(b) If to Seller, to:
GC Companies, Inc.
0000 Xxxxxxxx Xxxxxx
Xxxxxxxx Xxxx, Xxxxxxxxxxxxx 00000
Attention: G. Xxxx Xxxxxxx
With a copy to: Xxxxxx X. Xxxxxx, Esq.
Facsimile: (000) 000-0000
with a copy to (which will not itself constitute notice):
Xxxxxxx Procter LLP
Exchange Place
Boston, Massachusetts 01209
Attention: Xxxxxx X. Xxxxxxxx, P.C.
Facsimile: (000) 000-0000
37
All such notices, requests and other communications will (a) if delivered
personally to the address as provided in this Section, be deemed given upon
delivery, (b) if delivered by facsimile transmission to the facsimile number as
provided for in this Section, be deemed given upon receipt, (c) if delivered by
mail in the manner described above to (i) an address in the United States as
provided in this Section, be deemed given on the earlier of the third Business
Day following mailing or upon receipt or (ii) an address outside of the United
States as provided in this Section, be deemed given on the earlier of the tenth
Business Day following mailing or upon receipt and (d) if delivered by overnight
courier to the address as provided for in this Section, be deemed given on the
earlier of the first Business Day following the date sent by such overnight
courier or upon receipt (in each case regardless of whether such notice request
or other communication is received by any other Person to whom a copy of such
notice is to be delivered pursuant to this Section). A party from time to time
may change its address, facsimile number or other information for the purpose of
notices to that party by giving notice specifying such change to the other party
hereto.
8.03 ENTIRE AGREEMENT. Except for the LOI and the Interim Operating
Agreement and except as provided in Article V above or in Section 8.05 below,
this Agreement supersedes all prior discussions and agreements between the
parties with respect to the subject matter hereof and thereof and contain the
sole and entire agreement between the parties hereto with respect to the subject
matter hereof.
8.04 EXPENSES. Except as otherwise expressly provided in this
Agreement, each party will pay its own costs and expenses incurred in connection
with this Agreement and the transactions contemplated hereby.
8.05 CONFIDENTIALITY. The Purchasers agree that, except as provided
in the LOI or this Agreement, that certain letter agreement respecting
confidentiality and nondisclosure dated June 29, 2001 between GCX and AMCE shall
remain in effect. The provisions of this Section shall survive the termination
of this Agreement, but such letter agreement shall terminate and be merged into
the Closing.
8.06 AMENDMENT AND WAIVER. Any provision of this Agreement may be
amended or waived if, and only if, such amendment or waiver is in writing and
signed, in the case of an amendment, by each of the parties, or in the case of a
waiver, by the party against whom the waiver is to be effective, subject in each
case to approval of the Bankruptcy Court where required. No failure or delay by
any party in exercising any right, power or privilege under this Agreement will
operate as a waiver of such right, power privilege nor will any single or
partial exercise of such right, power or privilege preclude any other or further
exercise of such right, power or privilege or the exercise of any other right,
power or privilege.
38
8.07 NO THIRD PARTY BENEFICIARY. The terms and provisions of this
Agreement are intended solely for the benefit of each party hereto and their
respective successors or permitted assigns. It is not the intention of the
parties to confer third-party beneficiary rights, and this Agreement does not
confer any such rights upon any other Person.
8.08 NO ASSIGNMENT BINDING EFFECT. Neither this Agreement nor any
rights, interest, or obligation hereunder may be assigned (by operation of law
or otherwise) by any Seller without the prior written consent of AMC, and any
attempt to do so will be void; provided, however, that Purchaser may assign all
of its rights and obligations under this Agreement to a wholly-owned subsidiary
to Purchaser without obtaining the consent of Seller as long as such assignment
does not relieve Purchaser of its obligations under this Agreement and is
evidenced by a written assignment agreement in which the assignee expressly
assumes such rights and obligations. Subject to the preceding sentence, this
Agreement is binding upon, inures to the benefit of and is enforceable by the
parties hereto and their respective heirs, executors, personal representatives,
successors and assigns.
8.09 SEVERABILITY. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under any present or future Law and if the
rights or obligations of any party hereto under this Agreement will not be
materially and adversely affected thereby, (a) such provision will be fully
severable, (b) this Agreement will be construed and enforced as if such illegal,
invalid or unenforceable provision had never comprised a part hereof, (c) the
remaining provisions of this Agreement will remain in full force and effect and
will not be affected by the illegal, invalid or unenforceable provision or by
its severance here from and (d) in lieu of such illegal, invalid or
unenforceable provision, there will be added automatically as a part of this
Agreement a legal, valid and enforceable provision as similar in terms to such
illegal, invalid or unenforceable provision as may be possible.
8.10 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the domestic laws of the State of New York, without
giving effect to any choice of law or conflict of law provision or rule (whether
of the State of New York or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of New York.
8.11 CONSTRUCTION. The parties hereto agree that this Agreement is
the product of negotiation between parties and individuals, all of whom were
represented by counsel, and each of whom had an opportunity to participate in
and did participate in the drafting of each provision hereof. Accordingly,
ambiguities in this Agreement, if any, shall not be construed strictly or in
favor of or against any party hereto but rather shall be given a fair and
reasonable construction.
39
8.12 COUNTERPARTS. This Agreement may be executed in any number of
counterparts each of which will be deemed an original, but all of which together
will constitute one and the same instrument.
*** SIGNATURE PAGE FOLLOWS ***
40
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
"SELLER"
GC COMPANIES, INC.
By:________________________________
G. Xxxx Xxxxxxx, President and
Chief Operating Officer
"PURCHASERS"
AMC ENTERTAINMENT INC.
By:________________________________
Xxxxx X. Xxxxxx
Senior Vice President and Chief
Financial Officer
AMERICAN MULTI-CINEMA, INC.
By:________________________________
Xxxxx X. Xxxxxx
Senior Vice President and Chief
Financial Officer
CENTERTAINMENT
DEVELOPMENT, INC.
By:________________________________
Xxxxx X. Xxxxxx
Senior Vice President and Chief
Financial Officer
Exhibit A
DATA ROOM INDEX
Attached
Exhibit B
ORGANIZATIONAL CHART
Attached
Exhibit C
REAL PROPERTY
Attached
Exhibit D
RETENTION LETTER
Attached
