EXHIBIT 2.1
EXECUTION COPY
TRANSFER AGREEMENT
THIS TRANSFER AGREEMENT ("Agreement"), dated as of December 23, 2002,
by and among Playboy Enterprises, Inc., a Delaware corporation ("PEI"), Playboy
Entertainment Group, Inc., a Delaware corporation ("PEGI"), Playboy Enterprises
International, Inc., a Delaware corporation ("PEII"), Claxson Interactive Group
Inc., a British Virgin Islands corporation ("Claxson"), Carlyle Investments LLC,
a Delaware limited liability company ("Carlyle") (in its own right and as a
successor in interest to Victoria Springs Investments Ltd., a British Virgin
Islands corporation ("VSI")), Carlton Investments LLC, a Delaware limited
liability company ("Carlton", and together with Carlyle, "Carlton and Carlyle")
(in its own right and as a successor in interest to VSI), Lifford International
Co. Ltd. (BVI), a British Virgin Islands corporation ("Lifford"), and Playboy TV
International, LLC, a Delaware limited liability company ("PTVI"). Terms used
but not defined herein shall have the meaning set forth in Section 10.
WHEREAS, concurrently with the execution of this Agreement, the parties
hereto are closing the restructuring (the "Restructuring") of the joint venture
relationships among PEI and its Affiliates, on the one hand, and Claxson and its
Affiliates, on the other hand;
WHEREAS, Carlton and Carlyle are presently the beneficial owners of an
80.1% membership interest (the "PTVI Interest") in PTVI;
WHEREAS, Lifford is presently the record and beneficial owner of
728,112 shares of Series A Preferred Stock (the "Xxxxxxx.xxx Interest") of
Xxxxxxx.xxx, Inc., a Delaware corporation ("Xxxxxxx.xxx");
WHEREAS, pursuant to the terms of the PTVI Operating Agreement, Carlton
and Carlyle are presently obligated to make additional mandatory capital
contributions to PTVI up to the maximum amount specified in the PTVI Operating
Agreement (the "Carlton and Carlyle Capital Contribution") which amounts will be
used, among other things, to cover operating losses and to enable PTVI to
satisfy the PTVI Payment Obligation;
WHEREAS, Lifford desires to assign, transfer and convey the Xxxxxxx.xxx
Interest to PEI, and PEI has agreed to accept such assignment, transfer and
conveyance;
WHEREAS, Carlton and Carlyle desire not to make the Carlton and Carlyle
Capital Contribution and, instead, desire to surrender the PTVI Interest to
PTVI, and PEGI has agreed to accept Carlton and Carlyle's surrender of the PTVI
Interest to PTVI in lieu of pursuing any other course of action available to it
under the PTVI Operating Agreement, the PTVI Program Supply Agreement, the PTVI
Trademark License Agreement, the Carlyle Guaranty or the Carlton Guaranty;
WHEREAS, the parties hereto desire to effect the transactions
contemplated hereby upon the terms set forth herein;
NOW THEREFORE, in consideration of the premises, the mutual promises of
the parties hereto and the mutual benefits to be gained by the performance
thereof, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, PEI, PEII, PEGI, Claxson, Xxxxxxx, Xxxxxxx,
Lifford and PTVI, for their respective successors and permitted assigns, hereby
agree as follows:
Section 1. PEI's Representations and Warranties.
PEI, PEII and PEGI, jointly and severally, represent and warrant to
Claxson, Xxxxxxx, Xxxxxxx and Lifford as follows:
(a) Authority. Each of PEI, PEII and PEGI has been duly
organized, and is validly existing and in good standing, under the laws of its
jurisdiction of formation, has the power and authority to execute, deliver and
carry out the terms and provisions of this Agreement and each other
Restructuring Agreement and to consummate the transactions contemplated hereby
and thereby, and has taken all necessary action to authorize the execution,
delivery and performance of this Agreement and each other Restructuring
Agreement. No vote of any class or series of stock issued by PEI, PEII or PEGI
or any other corporate action on the part of PEI, PEII or PEGI is necessary to
approve the Restructuring or any of the Restructuring Agreements.
(b) Enforceability. This Agreement and each of the
Restructuring Agreements (as applicable) has each been duly executed and
delivered by each of PEI, PEII and PEGI, and, assuming due and legal, valid
authorization, execution and delivery hereof and thereof by Claxson, Xxxxxxx,
Xxxxxxx, Lifford and PTVI and the other parties thereto (other than PEI, PEII,
PEGI and any Affiliates of PEI, PEII or PEGI), constitutes a legal, valid and
binding obligation of each of PEI, PEII and PEGI, enforceable against each of
PEI, PEII and PEGI in accordance with its terms.
(c) Consents and Approvals; No Violations. Except for the
filings, permits, authorizations, consents and approvals as may be required
under, and other applicable requirements of, the Exchange Act, and state
securities or blue sky laws, none of the execution, delivery or performance of
this Agreement or any other Restructuring Agreement by PEI, PEII and PEGI, the
consummation by PEI, PEII and PEGI of the Restructuring or compliance by PEI,
PEII and PEGI with any of the provisions hereof or thereof will (i) conflict
with or result in any breach of any provision of the certificate of
incorporation, the by-laws or similar organizational documents of PEI or its
Subsidiaries, (ii) require any filing with, or permit, authorization, consent or
approval of, any Governmental Entity or other Person (including consents from
parties to Contracts to which PEI or any of its Subsidiaries or Affiliates is a
party or is bound or subject), (iii) require any consent, approval or notice
under, or result in a violation or breach of, or constitute (with or without due
notice or the passage of time or both) a default (or give rise to any right of
termination, amendment, cancellation or acceleration) under, any of the terms,
conditions or provisions of any Contract to which PEI or any of
2
its Subsidiaries or Affiliates is a party or is bound or subject, or (iv)
violate any order, writ, injunction, decree, statute, law, rule or regulation
applicable to PEI or its Subsidiaries or Affiliates or any of their respective
properties or assets.
Section 2. Claxson's Representations and Warranties.
Claxson, Xxxxxxx, Xxxxxxx and Lifford, jointly and severally, represent
and warrant to PEI, PEII and PEGI as follows:
(a) Authority. Each of Claxson, Xxxxxxx, Xxxxxxx and Lifford
has been duly organized, and is validly existing and in good standing, under the
laws of its jurisdiction of formation, has the power and authority to execute,
deliver and carry out the terms and provisions of this Agreement and each other
Restructuring Agreement to which it is a party and to consummate the
transactions contemplated hereby and thereby, and has taken all necessary action
to authorize the execution, delivery and performance of this Agreement and each
other Restructuring Agreement to which it is a party. No vote of any class or
series of stock issued by Claxson, Xxxxxxx, Xxxxxxx and Lifford or any of their
Subsidiaries (excluding PTVI and PTVLA) or any other corporate action on the
part of Claxson, Xxxxxxx, Xxxxxxx and Lifford or any of their Subsidiaries
(excluding PTVI and PTVLA) is necessary to approve the Restructuring or any of
the Restructuring Agreements.
(b) Enforceability. This Agreement and each of the
Restructuring Agreements (as applicable) has each been duly executed and
delivered by each of Claxson, Xxxxxxx, Xxxxxxx and Lifford, and, assuming due
and legal, valid authorization, execution and delivery hereof and thereof by
PEI, PEII and PEGI and the other parties thereto (other than Claxson, Xxxxxxx,
Xxxxxxx and Lifford and any of their respective Affiliates), constitutes a
legal, valid and binding obligation of Claxson, Xxxxxxx, Xxxxxxx and Lifford,
enforceable against each of Claxson, Xxxxxxx, Xxxxxxx and Lifford in accordance
with its terms.
(c) Consents and Approvals; No Violations. Except for the
filings, permits, authorizations, consents and approvals as may be required
under, and other applicable requirements of, the Exchange Act, and state
securities or blue sky laws, none of the execution, delivery or performance of
this Agreement or any other Restructuring Agreement by Claxson and its
Subsidiaries and Affiliates (excluding PTVI and PTVLA), the consummation by
Claxson and its Subsidiaries and Affiliates (excluding PTVI and PTVLA) of the
Restructuring or compliance by Claxson and its Subsidiaries and Affiliates
(excluding PTVI and PTVLA) with any of the provisions hereof will (i) conflict
with or result in any breach of any provision of the certificate of
incorporation, the by-laws or similar organizational documents of Claxson or its
Subsidiaries (excluding PTVI and PTVLA), (ii) require any filing with, or
permit, authorization, consent or approval of, any Governmental Entity or other
Person (including consents from parties to Contracts to which Claxson or any of
its Subsidiaries or Affiliates (excluding PTVI and PTVLA) is a party or is bound
or subject), (iii) require any consent, approval or notice under, or result in a
violation or breach of, or constitute (with or without due notice or the passage
of time or both) a default (or give rise to any
3
right of termination, amendment, cancellation or acceleration) under, any of the
terms, conditions or provisions of any Contract to which Claxson or its
Subsidiaries or Affiliates (excluding PTVI and PTVLA) is a party or is bound or
subject, or (iv) violate any order, writ, injunction, decree, statute, law, rule
or regulation applicable to Claxson or its Subsidiaries or Affiliates (excluding
PTVI and PTVLA) or any of their respective properties or assets.
(d) Representation of Ownership. Carlton and Carlyle are the
sole record and beneficial owners of the PTVI Interest free and clear of any and
all liens, charges, security interests, claims, mortgages, pledges, proxies,
voting trusts or agreements, obligations, understandings or arrangements or
other restrictions on title or transfer of any nature whatsoever (collectively,
"Encumbrances"), other than Encumbrances imposed by the PTVI Operating Agreement
and restrictions on transfer imposed by applicable federal and state securities
laws. Lifford is the sole record and beneficial owner of the Xxxxxxx.xxx
Interest free and clear of any and all Encumbrances, other than Encumbrances
imposed by the Investors' Rights Agreement, dated as of August 13, 2001 (the
"Investors' Rights Agreement"), by and between Xxxxxxx.xxx and the Investors (as
defined therein), the Right of First Refusal and Co-Sale Agreement (the "Co-Sale
Agreement"), dated as of August 13, 2001, by and among Xxxxxxx.xxx, PEI and the
Stockholders (as defined therein) and restrictions on transfer imposed by
applicable federal and state securities laws. Upon consummation of the
transactions contemplated by this Agreement, PTVI will acquire the PTVI Interest
free and clear of all Encumbrances other than Encumbrances imposed by the PTVI
Operating Agreement and restrictions on transfer imposed by applicable federal
and state securities laws, and neither Claxson nor any of its Subsidiaries or
Affiliates will own any Equity Interest or have any other rights in PTVI. Upon
consummation of the transactions contemplated by this Agreement, PEI will
acquire the Xxxxxxx.xxx Interest free and clear of all Encumbrances other than
Encumbrances imposed by the Investors' Rights Agreement, the Co-Sale Agreement
and restrictions on transfer imposed by applicable federal and state securities
laws, and neither Claxson nor any of its Subsidiaries or Affiliates will own any
Equity Interest or have any other rights in Xxxxxxx.xxx. No person has any
rights as a successor or assignee under any of the agreements entered into by
Lifford in connection with the issuance by Xxxxxxx.xxx of 782,112 shares of its
Series A Preferred Stock to Lifford on August 13, 2001 (including, without
limitation, the Investors' Rights Agreement and the Co-Sale Agreement).
(e) No Undisclosed Liabilities. Except as reflected or
reserved against in the March Balance Sheet, there are no Liabilities, other
than Liabilities which, individually or in the aggregate, are not material to
the business or condition of PTVI and its Subsidiaries, arising out of, relating
to or resulting from the ownership or operations of the business, properties and
assets of PTVI and its Subsidiaries on or prior to March 31, 2002. To the
knowledge of Claxson and its Subsidiaries after due inquiry, except as reflected
or reserved against in the September Balance Sheet, there are no Liabilities,
other than Liabilities which, individually or in the aggregate, are not material
to the business or condition of PTVI and its Subsidiaries, arising out of,
relating to or resulting from the ownership or operations of the business,
properties and assets of PTVI and its Subsidiaries from April 1, 2002 to the
date of this Agreement. Notwithstanding the
4
foregoing, no representations or warranties are made with respect to Liabilities
(x) owed to PEI or its Subsidiaries or Affiliates pursuant to any contract or
agreement or (y) related to or arising out of the ownership or operations of the
business, properties or assets of Playboy TV UK Limited, Playboy TV/UK Benelux
Ltd. or The Playboy Channel Japan, Inc.
(f) Affiliated Transactions. Schedule 2(f) contains a complete
and accurate listing of any current officer, director, key employee or Affiliate
of Claxson or any of its Subsidiaries or the Xxxxxxxx Group who is, directly or
indirectly, a party to any Contract or transaction (other than with respect to
compensation or travel expense account reimbursement in the ordinary course of
business consistent with past practice) with, or has any loan obligation to or
from, PTVI or any of its Subsidiaries (or for which any of them is or may be
liable under any guarantee or otherwise) or has any interest in any property
used by PTVI or any of its Subsidiaries. Schedule 2(f) sets forth a brief
description of each such transaction, including, without limitation, any
Contract providing for the furnishing of services (other than employment
contracts), or the rental of real or personal property from, or otherwise
requiring payments to, any such Person.
Section 3. Transfer.
In consideration of the closing of the Restructuring and the
transactions pursuant to the terms hereof and the other Restructuring
Agreements, (a) Carlton and Carlyle hereby assign, transfer and convey to PTVI
all of their right, title and interest in the PTVI Interest, free and clear of
all Encumbrances other than Encumbrances imposed by the PTVI Operating Agreement
and restrictions on transfer imposed by applicable federal and state securities
laws, and (b) Lifford hereby assigns, transfers and conveys all of Lifford's
right, title and interest in the Xxxxxxx.xxx Interest to PEI, free and clear of
all Encumbrances other than Encumbrances imposed by the Investors' Rights
Agreement or the Co-Sale Agreement and restrictions on transfer imposed by
applicable federal and state securities laws. The conveyance of the PTVI
Interest to PTVI pursuant to the terms hereof shall be deemed effective as of
April 1, 2002 upon the execution and delivery by each of Carlton and Carlyle to
PTVI of the Certificate attached as Exhibit A hereto. The conveyance of the
Xxxxxxx.xxx Interest to PEI pursuant to the terms hereof will be effective upon
the delivery by Lifford to PEI of certificates representing the Xxxxxxx.xxx
Interest, accompanied by irrevocable stock powers duly endorsed in blank in the
form attached as Exhibit B hereto.
Section 4. Affiliated Transactions.
Except as set forth on Schedule 4, Claxson shall cause all Contracts
and transactions (including loan obligations) between PTVI and any of its
Subsidiaries (or for which any of them is or may be liable under any contract or
otherwise) and any current officer, director, key employee or Affiliate of
Claxson or any of its Subsidiaries (excluding PTVI and its Subsidiaries) or the
Xxxxxxxx Group, including, without limitation, those Contracts and transactions
set forth on Schedule 2(f) hereto, to be terminated effective as of April 1,
2002, and shall deliver to PEI evidence of such terminations that is reasonably
acceptable to PEI.
5
Section 5. Indemnification and Mutual Releases.
(a) (i) Claxson, Xxxxxxx, Xxxxxxx and Lifford agree to
indemnify and hold PEI and its Subsidiaries and their respective stockholders,
members, directors, officers, employees, attorneys, agents and Affiliates
(collectively, the "PEI Indemnified Parties") harmless from and against the
aggregate of all Losses incurred or suffered by the PEI Indemnified Parties
arising out of, relating to, or resulting from (i) any breach of a
representation or warranty (other than the representations and warranties set
forth in Section 2(e)) made by Claxson, Xxxxxxx, Xxxxxxx or Lifford in or
pursuant to this Agreement (determined in all cases as if the terms "material"
or "materially" were not included therein), (ii) any breach of the covenants or
agreements made by Claxson, Xxxxxxx, Xxxxxxx or Lifford in or pursuant to this
Agreement and (iii) any inaccuracy in any certificate, instrument or other
document delivered by Claxson, Xxxxxxx, Xxxxxxx or Lifford as required by this
Agreement.
(ii) Claxson, Xxxxxxx, Xxxxxxx and Lifford also agree to
indemnify and hold the PEI Indemnified Parties harmless from and against the
aggregate of 80.1% of all Losses incurred or suffered by the PEI Indemnified
Parties related to, arising out of or resulting from any breach of the
representations and warranties set forth in Section 2(e) hereof (determined in
all cases as if the phrase "other than Liabilities which, individually or in the
aggregate, are not material to the business or condition of PTVI and its
Subsidiaries" were not included therein) (the "Indemnifiable Losses"), provided,
however, that Claxson, Xxxxxxx, Xxxxxxx and Lifford shall not be required to
indemnify and hold the PEI Indemnified Parties harmless under this Section
5(a)(ii) until the Indemnifiable Losses singly or in the aggregate exceed
$500,000, at which point Claxson, Xxxxxxx, Xxxxxxx and Lifford shall be required
to indemnify and hold the PEI Indemnified Parties harmless for all Indemnifiable
Losses up to $10,000,000 (the "Cap"). Claxson shall satisfy its obligation to
pay Indemnifiable Losses pursuant to this Section 5(a)(ii) by Transferring (as
defined in the PTVLA Operating Agreement), or causing to be Transferred, to the
applicable PEI Indemnified Parties, Membership Interests (as defined in the
PTVLA Operating Agreement) in PTVLA equal to the Indemnifiable Losses divided by
the Fair Market Value (as defined in the PTVLA Operating Agreement) of PTVLA at
the time of the Transfer (determined in accordance with Exhibit C to the PTVLA
Operating Agreement). Notwithstanding the foregoing sentence, if Claxson or its
Affiliates Transfer any Membership Interests in PTVLA to a third party in
accordance with the terms of the PTVLA Operating Agreement, the PEI Indemnified
Parties shall have recourse to Claxson's and its Subsidiaries' remaining assets
up to the Cap; provided, however, that the parties hereto expressly acknowledge
that all indemnification obligations of Claxson, Xxxxxxx, Xxxxxxx or Lifford
under this Section 5(a)(ii), shall terminate pursuant to the terms of Section 7
herein.
6
(b) PEI, PEII and PEGI agree to indemnify and hold Claxson and
its Subsidiaries and their respective stockholders, members, directors,
officers, employees, attorneys, agents and Affiliates (collectively, the
"Claxson Indemnified Parties") harmless from and against the aggregate of all
Losses incurred or suffered by the Claxson Indemnified Parties arising out of,
relating to, or resulting from (i) any breach of a representation or warranty
made by PEI, PEII or PEGI in or pursuant to this Agreement (determined in all
cases as if the terms "material" or "materially" were not included therein),
(ii) any breach of the covenants or agreements made by PEI, PEII or PEGI in or
pursuant to this Agreement, and (iii) any inaccuracy in any certificate,
instrument or other document delivered by PEI, PEII or PEGI as required by this
Agreement.
(c) The right to indemnification, payment of Losses or for
other remedies based on any representation, warranty, covenant or obligation of
any of PEI, PEII, PEGI, Claxson, Xxxxxxx, Xxxxxxx or Lifford contained in or
made pursuant to this Agreement shall not be affected by any investigation
conducted with respect to, or any knowledge acquired (or capable of being
acquired) at any time, whether before or after the execution and delivery of
this Agreement or the closing of the Restructuring, with respect to the accuracy
or inaccuracy of or compliance with, any such representation, warranty, covenant
or obligation.
(d) (i) Claxson, on behalf of itself and the other Claxson
Indemnified Parties (collectively, the "Claxson Releasing Parties"), for good
and sufficient consideration, the receipt of which is acknowledged, releases
absolutely and forever discharges the PEI Indemnified Parties (the "PEI Released
Parties"), from any and all actual or possible claims, charges, damages,
demands, debts, liabilities, losses, accounts, reckonings, obligations, suits,
actions and causes of action of every kind and nature whatsoever, including, but
not limited to, those arising under contract, statute or common law, whether or
not known or suspected at this time, which the Claxson Releasing Parties have,
or ever had, owned or held, or hereafter can, shall or may have against any or
all of the PEI Released Parties, based upon, arising out of, related to, or by
reason of any cause, occurrence, event, act, fact, circumstance, thing,
statement or omission occurring before the date of this Agreement relating to,
arising from or in connection with PTVI (collectively, "Claxson Claims"), other
than Claxson Claims relating to, arising out of, or in connection with (i) the
matters set forth in any Restructuring Agreement or (ii) the willful malfeasance
or intentional misconduct of, or fraud by, any PEI Released Party.
(ii) PEI, on behalf of itself and the other PEI
Indemnified Parties (collectively, the "PEI Releasing Parties"), for good and
sufficient consideration, the receipt of which is acknowledged, releases
absolutely and forever discharges the Claxson Indemnified Parties (the "Claxson
Released Parties"), from any and all actual or possible claims, charges,
damages, demands, debts, liabilities, losses, accounts, reckonings, obligations,
suits, actions and causes of action of every kind and nature whatsoever,
including, but not limited to, those arising under contract, statute or common
law, whether or not known or suspected at
7
this time, which the PEI Releasing Parties have, or ever had, owned or held, or
hereafter can, shall or may have against any or all of the Claxson Released
Parties, based upon, arising out of, related to, or by reason of any cause,
occurrence, event, act, fact, circumstance, thing, statement or omission
occurring before the date of this Agreement relating to, arising from or in
connection with PTVI (collectively, "PEI Claims"), other than PEI Claims
relating to, arising out of or in connection with (i) the matters set forth in
any Restructuring Agreement or (ii) the willful malfeasance or intentional
misconduct of, or fraud by, any Claxson Released Party. Notwithstanding the
generality of the foregoing, the PEI Releasing Parties hereby expressly release
the Claxson Released Parties from any PEI Claims related to or arising from any
Claxson Released Party's election not to attend any board meetings of PTVI.
Section 6. Method of Asserting Claims.
All claims for indemnification by any party under Section 5 will be
asserted and resolved as follows:
(a) In the case of any claim asserted by a third party (a
"Third Party Claim") against a party entitled to indemnification under this
Agreement (the "Indemnified Party"), notice (a "Claim Notice") shall be given by
the Indemnified Party to the party required to provide indemnification (the
"Indemnifying Party") with reasonable promptness after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, and the
Indemnified Party shall permit the Indemnifying Party (at the expense of such
Indemnifying Party) to assume, direct and control the defense of any claim or
any litigation resulting therefrom, (a) the counsel for the Indemnifying Party
who shall conduct the defense of such claim or litigation shall be reasonably
satisfactory to the Indemnified Party, (b) the Indemnified Party may participate
in such defense at such Indemnified Party's expense, and (c) the failure by any
Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its indemnification obligation under this Agreement except
to the extent that such failure results in a failure of actual notice to the
Indemnifying Party and such Indemnifying Party is irreparably and materially
prejudiced as a result of such failure to give notice. Except with the prior
written consent of the Indemnified Party, such consent not to be unreasonably
withheld, no Indemnifying Party, in the defense of any such claim or litigation,
shall consent to entry of any judgment or enter into any settlement. In the
event that the Indemnified Party shall in good faith determine (x) that the
conduct of the defense of any claim by the Indemnifying Party might be expected
to (i) affect adversely the ability of an Indemnified Party to conduct its
businesses, (ii) result in the finding or admission of any violation of
applicable law by the Indemnified Party or (iii) result in the imposition of
injunctive or other equitable relief against the Indemnified Party or (y) that
the Indemnified Party may have available to it one or more defenses or
counterclaims that are inconsistent with one or more of those that may be
available to the Indemnifying Party in respect of such claim or any litigation
relating thereto, the Indemnified Party shall have the right at all times to
take over and assume control over the defense, settlement, negotiations or
litigation relating to any such claim, provided that
8
if the Indemnified Party does so take over and assume control, the Indemnified
Party shall not settle such claim or litigation without the written consent of
the Indemnifying Party, such consent not to be unreasonably withheld and unless
prior thereto or in connection therewith the Indemnified Party unconditionally
releases the Indemnifying Party. In the event that the Indemnified Party takes
over and assumes control over the defense, settlement, negotiations or
litigations relating to any such claim the Indemnifying Party shall pay
reasonable fees and expenses of counsel for the Indemnified Party. In the event
that the Indemnifying Party does not accept the defense of any matter as above
provided, the Indemnified Party shall have the full right to defend against any
such claim or demand and shall be entitled to settle or agree to pay in full
such claim or demand. In any event, the Indemnifying Party and the Indemnified
Party shall cooperate in the defense of any claim or litigation subject to this
Section 6 and the records of each shall be available to the other with respect
to such defense.
(b) In the event any Indemnified Party should have a claim
under Section 5 against an Indemnifying Party that does not involve a Third
Party Claim, the Indemnified Party shall deliver a written notification of the
indemnification claim specifying the nature of and basis for such
indemnification claim (the "Indemnity Notice") with reasonable promptness to the
Indemnifying Party. If an Indemnifying Party notifies the Indemnified Party that
it does not dispute the claim described in such Indemnity Notice or fails to
notify the Indemnified Party within forty-five (45) days following receipt of
the Indemnity Notice whether the Indemnifying Party disputes the claim described
in such Indemnity Notice, the Loss arising from the claim specified in such
Indemnity Notice will be conclusively deemed a liability of the Indemnifying
Party under Section 5 and the Indemnifying Party shall pay the amount of such
Loss to the Indemnified Party on demand following the final determination
thereof. If the Indemnifying Party has timely disputed its liability with
respect to such claim, the Indemnifying Party and the Indemnified Party will
resolve such dispute in accordance with Section 8 herein.
Section 7. Survival of Representations and Warranties, etc.
The covenants and agreements of the parties contained in this Agreement
and the representations and warranties contained in Sections 1(a), 1(b), 2(a),
2(b) and 2(d) will survive the consummation of the Restructuring without
limitation; and all other representations and warranties of PEI, PEII, PEGI,
Claxson, Xxxxxxx, Xxxxxxx and Lifford contained in this Agreement will survive
the consummation of the Restructuring until the date that is 45 days after the
completion of the full audit of PTVI's consolidated financial statements for the
fiscal year ending December 31, 2003, but in no event later than June 1, 2004;
provided, however, that any representation or warranty that would otherwise
terminate will continue to survive, with respect to such claim only, if a Claim
Notice or Indemnity Notice (as applicable) shall have been timely given in good
faith based on facts reasonably expected to establish a valid claim under
Section 5 on or prior to such termination date, until the related claim for
indemnification has been satisfied or otherwise resolved as provided in Section
6.
9
Section 8. Dispute Resolution.
(a) If any dispute or difference of any kind whatsoever shall
arise between the parties in connection with, arising out of or relating to this
Agreement (including any schedule or exhibit hereto), or the breach, termination
or validity thereof (a "Dispute"), the parties shall attempt to settle such
Dispute in the first instance by mutual discussions. For the purpose of this
Section 8, PEI and its Subsidiaries and Affiliates shall act and be treated as
one party, and Claxson and its Subsidiaries and Affiliates shall act and be
treated as one party. Within ten (10) business days of the receipt by a party of
a notice of the existence of a Dispute ("Notice"), the receiving party shall
submit a written response to the other party ("Response"). Both the Notice and
the Response shall include (i) a statement of each party's position with regard
to the Dispute and a summary of arguments supporting that position; and (ii) the
name and title of the senior executive who will represent that party in
attempting to resolve the Dispute pursuant to this Section 8(a). Within five (5)
business days of receipt of the Response, the designated executives shall meet
and attempt to resolve the Dispute. All negotiations pursuant to this clause
shall be confidential and shall be treated as compromise and settlement
negotiations, and no oral or documentary representations made by the parties
during such negotiations shall be admissible for any purpose in any subsequent
proceedings. If any Dispute is not resolved for any reason within twenty (20)
days of receipt of the Response (or within such longer period as to which the
parties have agreed in writing), then, on the request of any party the Dispute
shall be submitted to arbitration in accordance with Sections 8(b)-(e) herein.
(b) Any Dispute not timely resolved in accordance with Section
8(a) shall be finally and exclusively settled by arbitration in accordance with
the International Arbitration Rules of the American Arbitration Association
("AAA") then in effect (the "Rules"), except as modified herein. The arbitration
shall be held in Los Angeles, California. The arbitration proceedings shall be
conducted, and the award shall be rendered, in the English language.
(c) If the Dispute (including claims and counterclaims) is for
less than $5 million, there shall be one arbitrator. The parties shall have
fifteen (15) days from the receipt by the respondent of the demand for
arbitration to agree on an arbitrator. If the parties fail to timely agree, on
the request of any party such arbitrator shall be appointed by the AAA in
accordance with the Rules and the procedures set forth herein. If the Dispute
(including claims and counterclaims) is for more than $5 million, there shall be
three neutral and impartial arbitrators of whom the claimant and the respondent
shall each appoint one, within fifteen (15) days of the receipt by respondent of
a copy of the demand for arbitration. The two arbitrators so appointed shall
select a third arbitrator to serve as presiding arbitrator, such selection to be
made within twenty (20) days of the selection of the second arbitrator. If any
arbitrator is not appointed within the time limits set forth herein, such
arbitrator(s) shall be appointed by the AAA in accordance with the Rules and the
procedures set forth herein. There shall be no restriction on the nationality of
any arbitrator. Any arbitrator appointed by the AAA shall be either a retired
judge with experience in international commercial cases or a practicing attorney
with at least 15 years experience with large commercial cases and experience as
an international
10
arbitrator. The AAA shall send simultaneously to each party an identical list of
at least nine arbitrator candidates, and each party shall be permitted to strike
two names from the list, rank the remaining arbitrators in order of preference
and return the list to the AAA within ten (10) days of the transmittal date. If
a party does not return the list within the time specified, all persons named
therein shall be considered acceptable. From among the persons who remain on
both lists and in accordance with the designated order of mutual preference, the
AAA shall invite the acceptance of an arbitrator to serve. There shall be no
restrictions on the nationality of any arbitrator.
(d) The hearing on the merits shall be held as expeditiously as
possible, if practicable no later than four months after the appointment of a
single arbitrator or five months after the appointment of the third arbitrator,
as applicable. The hearing shall, if practicable, last no longer than ten days,
which shall be consecutive, if possible. The award, which shall be in writing
and shall briefly and concisely state the findings of fact and conclusions of
law on which it is based, shall be rendered, if practicable, within twenty (20)
days of the close of the hearing. In rendering an award, the arbitrator(s) shall
be required to follow the law of the State of New York. The arbitrator(s) are
not empowered to award damages in excess of compensatory damages and each party
hereby irrevocably waives any right to recover such damages with respect to any
dispute resolved by arbitration. The arbitrator(s) shall have the authority to
award the costs of the arbitration (including attorneys' fees and expenses) to
the prevailing party. The award shall be final and binding upon the parties and
shall be the sole and exclusive remedy between the parties regarding any claims,
counterclaims, issues or accounting presented to the arbitral tribunal. Judgment
upon any award may be entered in any court having jurisdiction thereof. Any
costs or fees (including attorney's fees and expenses) incident to enforcing the
award shall be charged against the party resisting such enforcement.
(e) By agreeing to arbitration, the parties do not intend to
deprive any court of its jurisdiction to issue a pre-arbitral injunction,
pre-arbitral attachment or other order in aid of arbitration proceedings and the
enforcement of any award. Without prejudice to such provisional remedies as may
be available under the jurisdiction of a national court, the arbitral tribunal
shall have full authority to grant provisional remedies or modify or vacate any
temporary or preliminary relief issued by a court, and to award damages for the
failure of any party to respect the arbitral tribunal's orders to that effect.
Section 9. Maintenance of Books and Records.
Within thirty (30) days after the consummation of the
Restructuring, Claxson shall cause all of the Books and Records relating to PTVI
and its Subsidiaries and their businesses, properties and assets held by Claxson
or its Subsidiaries or Affiliates to be transferred to PEGI. Each of the parties
hereto shall preserve, and shall cause its Subsidiaries and Affiliates to
preserve, until at least June 1, 2004, all pre-Restructuring records possessed
or to be possessed by such party relating to PTVI and its business, properties
and assets (provided that the foregoing shall not abridge Claxson's
11
obligation to transfer all Books and Records relating to PTVI and its
Subsidiaries to PEGI within thirty (30) days after consummating the
Restructuring).
Section 10. Definitions.
When used in this Agreement, the following terms shall have
the meanings set forth below:
"AAA" has the meaning set forth in Section 8(b).
"Affiliate" means any Person, directly or indirectly through
one or more intermediaries, controlling, controlled by, or under common control
with the specified Person. The term "control" (and "controlled" and
"controlling," respectively), means the possession, direct or indirect, of the
power to direct or cause the direction of the management and policies of the
specified Person (whether by Contract, the holding of shares or other Equity
Interests, the possession of voting rights or otherwise).
"Agreement" has the meaning set forth in the Preamble.
"Amended Program Supply Agreement" means the Amended Program
Supply Agreement, executed concurrently herewith and effective as of April 1,
2002, between PEGI and PTVLA with respect to the supply of programming for and
the licensing of trademarks to PTVLA.
"Books and Records" means, for any Person, all files,
documents, instruments, papers, books and records relating to the business,
operations, condition of (financial or other), results of operations and assets
and properties of such Person, including without limitation financial
statements, tax returns and related work papers and letters from accountants,
budgets, pricing guidelines, ledgers, journals, deeds, title policies, minute
books, stock certificates and books, stock transfer ledgers, contracts,
licenses, customer lists, computer files and programs, operating data and plans.
"California Courts" has the meaning set forth in Section
11(g).
"Carlton" has the meaning set forth in the Preamble.
"Carlton and Carlyle Capital Contribution" has the meaning set
forth in the Recitals.
"Carlton Guaranty" means the Guaranty, dated as of December
28, 2000, by Carlton Investments LLC in favor of and for the benefit of PTVI,
Playboy Enterprises International, Inc. and PEGI.
"Carlyle" has the meaning set forth in the Preamble.
"Carlyle Guaranty" means the Guaranty, dated as of December
28, 2000, by Carlyle Investments LLC in favor of and for the benefit of PTVI,
Playboy Enterprises International, Inc. and PEGI.
12
"Cap" has the meaning set forth in Section 5(a)(ii).
"Xxxxxxxx Group" means (i) Xxxxxxx X. Xxxxxxxx, Xxxxxxx X.
Xxxxxxxx, their respective wives and direct descendants or any entity, including
trusts, in which Xxxxxxx X. Xxxxxxxx and/or Xxxxxxx X. Xxxxxxxx or their
respective wives and direct descendants hold, directly or indirectly, at least
50.1% of the economic benefit or the total shares, participations or interests
in (however designated) corporate stock, partnership interests, limited
liability company interests, or any equivalents thereof of such entity, and
which is controlled, directly or indirectly, by any of such persons; or (ii) any
entity, including trusts, which is controlled, directly or indirectly, by any of
Xxxxxxx X. Xxxxxxxx and/or Xxxxxxx X. Xxxxxxxx or their respective wives and
direct descendants.
"Claim Notice" has the meaning set forth in Section 6(a).
"Claxson" has the meaning set forth in the Preamble.
"Claxson Claims" has the meaning set forth in Section 5(d)(i).
"Claxson Indemnified Parties" has the meaning set forth in
Section 5(b).
"Claxson Released Parties" has the meaning set forth in
Section 5(d)(ii).
"Claxson Releasing Parties" has the meaning set forth in
Section 5(d)(i).
"Contract" means any agreement, lease, license, evidence of
indebtedness, indenture, security agreement or other contract (whether written
or oral).
"Co-Sale Agreement" has the meaning set forth in Section 2(d).
"Dispute" has the meaning set forth in Section 8(a).
"Encumbrances" has the meaning set forth in Section 2(d).
"Equity Interest" means any and all shares, interests, rights
to purchase, warrants, options, participations or other equivalents of, rights
to acquire, or interests in (however designated) corporate stock, partnership
interests, limited liability company interests, trusts or any equivalents
thereof, including, without limitation, any security which is convertible into
or exercisable for such stock or interests.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Governmental Entity" means any (a) nation, state, county,
city, town, village, district or other jurisdiction of any nature, (b) federal,
state, provincial, local, county, municipal, foreign or other government, (c)
governmental or quasi-governmental authority of any nature (including any
governmental agency branch, department, official or entity and any court or
other tribunal), (d) multi-national organization or body, or (e) body
exercising, or entitled or purporting to exercise, any administrative,
executive, judicial, legislative, police, regulatory or taxing authority or
power of any nature.
13
"Indemnifiable Losses" has the meaning set forth in Section
5(a)(ii).
"Indemnified Party" has the meaning set forth in Section 6(a).
"Indemnifying Party" has the meaning set forth in Section
6(a).
"Indemnity Notice" has the meaning set forth in Section 6(b).
"Investors' Rights Agreement" has the meaning set forth in
Section 2(d).
"Liabilities" means all liabilities, obligations or
indebtedness (whether absolute, accrued, contingent, fixed or otherwise, or
whether due or to become due).
"Lifford" has the meaning set forth in the Preamble.
"Losses" means any and all claims, Liabilities, obligations,
losses, fines, costs, proceedings or damages (whether absolute, accrued,
conditional or otherwise), including out-of-pocket expenses and reasonable
attorneys' and accountants' fees incurred in the investigation, defense or
settlement of any of the same or in asserting any rights hereunder.
"March Balance Sheet" means the consolidated balance sheet of
PTVI and its Subsidiaries as of March 31, 2002 attached as Exhibit D hereto.
"Notice" has the meaning set forth in Section 8(a).
"PEGI" has the meaning set forth in the Preamble.
"PEI" has the meaning set forth in the Preamble.
"PEII" has the meaning set forth in the Preamble.
"PEI Claims" has the meaning set forth in Section 5(d)(ii).
"PEI Indemnified Parties" has the meaning set forth in Section
5(a)(i).
"PEI Released Parties" has the meaning set forth in Section
5(d)(i).
"PEI Releasing Parties" has the meaning set forth in Section
5(d)(ii).
"Person" means an individual, general partnership, limited
partnership, limited liability company, corporation, trust, estate, real estate
investment trust, association or any other entity.
"Xxxxxxx.xxx" has the meaning set forth in the Recitals.
"Xxxxxxx.xxx Interest" has the meaning set forth in the
Recitals.
"PTVI" has the meaning set forth in the Preamble.
14
"PTVI Interest" has the meaning set forth in the Recitals.
"PTVI Operating Agreement" means the Operating Agreement for
PTVI, dated as of August 31, 1999, by and between PEGI and VSI, as amended by
the First Amendment thereto, dated as of September 24, 1999, by and between PEGI
and VSI, and the Second Amendment to Operating Agreement, Release of Guaranty
and Consent to Transfer for PTVI, dated as of December 28, 2000, by and among
PEI, Playboy Enterprises International, Inc., a Delaware corporation ("PEII"),
VSI, Hampstead Management Company, Ltd., a British Virgin Islands corporation,
Carlton and Carlyle.
"PTVI Payment Obligation" means PTVI's obligation to make
additional library license and programming output payments pursuant to the PTVI
Program Supply Agreement to PEGI in the amount of $57.5 million through
September 2004.
"PTVI Program Supply Agreement" means the Program Supply
Agreement, dated as of August 31, 1999, by and among PEGI, PTVI and PTV U.S.,
LLC, a Delaware limited liability company.
"PTVI Trademark License Agreement" means the Trademark License
Agreement, dated as of August 31, 1999, by and among Playboy Enterprises
International, Inc. and PTVI.
"PTVLA" means Playboy TV - Latin America, LLC, a California
limited liability company.
"PTVLA Operating Agreement" means the Second Amended and
Restated Operating Agreement for PTVLA, effective as of April 1, 2002, by and
between PEGI and Lifford.
"Response" has the meaning set forth in Section 8(a).
"Restructuring" has the meaning set forth in the Recitals.
"Restructuring Agreements" means those agreements set forth on
Exhibit C hereto.
"Rules" has the meaning set forth in Section 8(b).
"September Balance Sheet" means the consolidated balance sheet
of PTVI and its Subsidiaries as of September 30, 2002, attached as Exhibit E
hereto.
"Subsidiary" means, with respect to any Person at any time,
any corporation, partnership, limited liability company or other entity, a
majority of the Equity Interests of which shall, at the time as of which any
determination is made, be owned, controlled or held by such Person either
directly or through Subsidiaries of such Person.
"Third Party Claim" has the meaning set forth in Section 6(a).
15
"Transfer" or "Transferred" have the meaning given them in the
PTVLA Operating Agreement.
"Venus Contribution Agreement" means the Venus Contribution
Agreement, dated as of December 23, 2002, by and between Claxson, Lifford, PTVLA
and PEGI.
"VSI" has the meaning set forth in the Preamble.
Section 11. Miscellaneous Provisions.
(a) Amendment and Modification. This Agreement may be
amended, modified and supplemented only by written agreement of each of the
parties hereto.
(b) Notices. All notices, requests, demands and other
communications required or permitted shall be made in writing by hand-delivery,
telecopier (with written confirmation) or air courier guaranteeing overnight
delivery:
if to PEI or PEII, to:
Playboy Enterprises, Inc.
Attention: General Counsel
000 Xxxxx Xxxx Xxxxx Xxxxx
Xxxxxxx, XX 00000
Xxxxxx Xxxxxx of America
Fax Number: (000) 000-0000
with a copy to:
Xxxx X. Xxxxxxxxx
Skadden, Arps, Slate, Xxxxxxx & Xxxx (Illinois)
000 X. Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Xxxxxx Xxxxxx of America
Fax Number: (000) 000-0000
if to PEGI or PTVI, to:
Playboy Entertainment Group, Inc.
Attention: President
0000 Xxxxx Xxxxxx Xx.
Xxx Xxxxxxx, XX 00000
United States of America
Fax Number: (000) 000-0000
16
with a copy to:
Playboy Enterprises, Inc.
Attention: General Counsel
000 Xxxxx Xxxx Xxxxx Xxxxx
Xxxxxx Xxxxxx xx Xxxxxxx
Fax Number: (000) 000-0000
if to Claxson, Xxxxxxx, Xxxxxxx or Lifford, to:
Claxson Interactive Group Inc.
Attention: Chairman and Chief Executive Officer
000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxx Xxxxx, Xxxxxxx 00000
United States of America
Fax Number: (000) 000-0000
With a copy to:
Claxson Interactive Group Inc.
Attention: General Counsel
000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxx Xxxxx, Xxxxxxx 00000
United States of America
Fax Number: (000) 000-0000
with a copy to:
L. Xxxxx X'Xxxx
Xxxxxxxx Chance US LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Xxxxxx of America
Fax Number: (000) 000-0000
or to such other address or facsimile transmission number as the relevant
addressee may hereafter by notice hereunder substitute.
All such notices, requests, demands and other communications
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; when receipt acknowledged, if telecopied; and on the next
business day, if timely delivered to an air courier guaranteeing overnight
delivery.
(c) Post-Restructuring Cooperation. In case at any
time after the consummation of the Restructuring any further action is
necessary, proper or advisable to carry out the purposes of this Agreement or
any other Restructuring Agreement, as soon
17
as reasonably practicable, each party hereto shall take, or cause its
Subsidiaries or Affiliates and their respective proper officers or directors to
take, all such necessary, proper or advisable actions.
(d) Severability. Whenever possible, each provision
of this Agreement shall be interpreted in such a manner as to be effective and
valid under applicable law, but if any provision of this Agreement is held to be
prohibited by or invalid under applicable law, such provision shall fail to be
in effect only to the extent of such prohibition or invalidity, without
invalidating the remainder of this Agreement or of any such provision.
(e) Assignment. This Agreement and all of the
provisions hereof shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted assigns, but except as
otherwise provided for or permitted herein neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned by any party hereto
without the prior written consent of each of the other parties hereto.
(f) Governing Law. This Agreement and the legal
relations among the parties hereto shall be governed by and construed in
accordance with the laws of the State of New York.
(g) Jurisdiction and Venue. SUBJECT TO SECTION 8
HEREIN, EACH OF PEI, PEII, PEGI, CLAXSON, XXXXXXX, XXXXXXX, LIFFORD AND PTVI
HEREBY IRREVOCABLY AGREE THAT ANY ACTION OR PROCEEDING TO COMPEL ARBITRATION, IN
AID OF ARBITRATION, OR FOR PRELIMINARY RELIEF IN AID OF ARBITRATION, TO PREVENT
IRREPARABLE HARM OR TO PRESERVE THE STATUS QUO PENDING THE APPOINTMENT OF AN
ARBITRAL TRIBUNAL, SHALL BE HEARD AND DETERMINED ONLY IN A CALIFORNIA STATE
COURT SITTING IN THE CITY OF LOS ANGELES OR, TO THE EXTENT PERMITTED BY LAW, IN
THE UNITED STATES DISTRICT COURT FOR THE CENTRAL DISTRICT OF CALIFORNIA SITTING
IN THE CITY OF LOS ANGELES (THE "CALIFORNIA COURTS"), AND EACH OF PEI, PEII,
PEGI, CLAXSON, XXXXXXX, XXXXXXX, LIFFORD AND PTVI HEREBY AGREE NOT TO BRING AN
ACTION IN ANY OTHER COURT, EXCEPT THAT AN ACTION TO ENFORCE A FINAL ARBITRAL
AWARD MAY BE ENFORCED IN ANY COURT HAVING JURISDICTION. EACH OF PEI, PEII, PEGI,
CLAXSON, XXXXXXX, XXXXXXX, LIFFORD AND PTVI HEREBY IRREVOCABLY SUBMIT TO AND
ACCEPT THE JURISDICTION OF THE CALIFORNIA COURTS, AND EACH OF PEI, PEII, PEGI,
CLAXSON, XXXXXXX, XXXXXXX, LIFFORD AND PTVI HEREBY IRREVOCABLY WAIVE, TO THE
FULLEST EXTENT THAT IT MAY EFFECTIVELY DO SO, ANY DEFENSE OR OBJECTION
(INCLUDING, WITHOUT LIMITATION, ANY DEFENSE OR OBJECTION TO VENUE BASED ON THE
GROUNDS OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
MAINTENANCE OF ANY ACTION IN SUCH JURISDICTIONS. EACH OF PEI, PEII, PEGI,
CLAXSON, XXXXXXX, XXXXXXX, LIFFORD AND PTVI HEREBY
18
IRREVOCABLY AGREE THAT THE SUMMONS AND COMPLAINT OR ANY OTHER PROCESS IN ANY
ACTION MAY BE SERVED BY MAILING (USING CERTIFIED OR REGISTERED MAIL, POSTAGE
PREPAID RETURN RECEIPT REQUESTED) TO THE NOTICE ADDRESS FOR SUCH PARTY SPECIFIED
ABOVE OR BY HAND DELIVERY TO A PERSON OF SUITABLE AGE AND DISCRETION AT SUCH
ADDRESS.
(h) Counterparts. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
(i) Headings. The headings of the Sections of this
Agreement are inserted for convenience only and shall not constitute a part
hereof or affect in any way the meaning or interpretation of this Agreement.
(j) Entire Agreement. This Agreement and the other
Restructuring Agreements set forth the entire agreement and understanding of the
parties hereto in respect of the subject matter contained herein and therein,
and supersede all prior agreements, promises, covenants, arrangements,
communications, representations or warranties, whether oral or written, relating
to the subject matter hereof and thereof.
(k) Specific Performance. Each of the parties hereto
recognizes and acknowledges that a breach by a party of any covenants or
agreements contained in this Agreement will cause the other party to sustain
injury for which it would not have an adequate remedy at law for money damages.
Therefore, each of the parties hereto agrees that in the event of any such
breach, the aggrieved party shall be entitled to the remedy of specific
performance of such covenants and agreements and preliminary and permanent
injunctive and other equitable relief in addition to any other remedy to which
it may be entitled, at law or in equity, and the parties hereto further agree to
waive any requirement for the securing or posting of any bond in connection with
the obtaining of any such injunctive or other equitable relief.
(l) Third Parties. Nothing herein expressed or
implied is intended or shall be construed to confer upon or give to any person
or corporation, other than the parties hereto and their successors or assigns,
any rights or remedies under or by reason of this Agreement.
19
EXHIBIT 2.1
EXECUTION COPY
IN WITNESS WHEREOF, PEI, PEII, PEGI, Claxson, Xxxxxxx,
Xxxxxxx, Lifford and PTVI have executed this Agreement effective as of the date
and year first above written.
PLAYBOY ENTERPRISES, INC.
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
PLAYBOY ENTERPRISES
INTERNATIONAL, INC.
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
PLAYBOY ENTERTAINMENT
GROUP, INC.
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
CLAXSON INTERACTIVE GROUP INC.
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
CARLYLE INVESTMENTS LLC
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
CARLTON INVESTMENTS LLC
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
LIFFORD INTERNATIONAL CO. LTD. (BVI)
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
PLAYBOY TV INTERNATIONAL, LLC
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
SCHEDULE 2(F)
AFFILIATED TRANSACTIONS
[SCHEDULE OMITTED]
Schedule 2(f)
EXHIBIT 2.1
EXECUTION COPY
SCHEDULE 4
SURVIVING AFFILIATED TRANSACTIONS
[SCHEDULE OMITTED]
Schedule 4
EXHIBIT A
TRANSFER OF MEMBERSHIP INTERESTS
[EXHIBIT OMITTED]
A-1
EXHIBIT B
STOCK POWER
[EXHIBIT OMITTED]
B-1
EXHIBIT C
SCHEDULE OF RESTRUCTURING AGREEMENTS
[EXHIBIT OMITTED]
C-1
EXHIBIT D
MARCH BALANCE SHEET
[CHART OMITTED]
D-1
EXHIBIT E
SEPTEMBER BALANCE SHEET
[CHART OMITTED]
E-1
