EXECUTION COPY
AGREEMENT
Agreement dated as of August 30, 2011 (this "Agreement"), by and among Lions
Gate Entertainment Corp. and its subsidiaries ("Lions Gate"), 0918988 B.C. Ltd,
a wholly owned subsidiary of Lions Gate ("BC 1"), 0918989 B.C. Ltd, a wholly
owned subsidiary of Lions Gate ("BC 2" and together with BC 1, jointly and
severally, the "Acquiror"), and Xxxx X. Icahn, Xxxxx Xxxxx and their affiliates
("Icahn"). The parties hereby agree as follows:
1. Simultaneously with the execution and delivery of this Agreement, the
Acquiror irrevocably purchases from Icahn and Icahn irrevocably sells to the
Acquiror 11,040,493 common shares, no par value per share ("Shares"), of Lions
Gate free and clear of all Encumbrances at $7.00 per Share in cash for aggregate
cash consideration of $77,283,451.00. Lions Gate, the Acquiror and Icahn shall
use best efforts to cause such transaction to settle as soon as possible, but in
no event shall such transaction settle later than September 2, 2011. Lions Gate
Entertainment Corp. shall take all necessary actions to cause the Acquiror to
perform its obligations under this pargraph 1 in accordance with the terms
hereof. Icahn shall deliver such Shares as directed by Lions Gate (via DTC book
entry transfer, by delivering stock certificates or through a combination of the
foregoing) immediately following confirmation of receipt of a wire transfer, to
an account designated by Icahn, of the purchase price set forth above. For the
avoidance of doubt, Lions Gate Entertainment Corp. shall not purchase any Shares
pursuant to this paragraph 1.
2. Lions Gate, or any direct or indirect subsidiary of Lions Gate designated by
Lions Gate, shall have the right, for 35 business days following the date of
this Agreement, to designate one or more parties including pursuant to a
registered offering (each a "Purchaser", provided that Lions Gate may not
designate itself or any of its direct or indirect subsidiaries) to purchase from
Icahn up to 22,080,985 Shares in the aggregate, free and clear of all
Encumbrances, at $7.00 per Share in cash. Any brokerage commissions will be paid
by Purchaser to a registered broker-dealer. As soon as possible following each
such designation by Lions Gate or its designee but in no event later than the
second business day following such designation, the applicable Purchaser shall
purchase from Icahn and Icahn shall sell to such Purchaser the relevant number
of Shares (not to exceed 22,080,985 Shares in the aggregate to all Purchasers
collectively) at $7.00 per Share in cash. Lions Gate will not, and will not
cause or assist any other Person, to obtain any payment or consideration in
connection with the sale of Shares pursuant to paragraph 2, other than the
payment of brokerage commissions to a registered broker-dealer.
3. The parties acknowledge and agree that the 1,236,938 Shares purchased by
Icahn in February 2010 shall not be sold pursuant to this Agreement and that
Icahn will not sell such Shares during the shorter of (the "Specified Period"):
(i) the 35 business day period referenced in paragraph 2; and (ii) such shorter
period, if any, ending on the date that all 22,080,985 Shares referenced in
paragraph 2 are sold. Lions Gate represents, warrants, covenants and agrees
that: (i) Icahn shall have no obligation or liability for any brokerage fees,
commissions, underwriting discounts or other similar fees or expenses relating
to the transactions contemplated by this Agreement incurred by any Person; and
(ii) all amounts payable to Icahn hereunder (including any amounts payable to
Icahn pursuant to one or more transactions contemplated by Section 2) shall be
delivered to Icahn without any deductions or withholdings by any Personfor
brokerage fees, commissions, underwriting discounts, taxes or otherwise.
4. The parties will cooperate to make all filings in all courts and tribunals of
Canada, the United States and New York State, and will take all other actions,
as are necessary to cause all currently pending litigation between or among the
parties to be dismissed with prejudice as soon as possible following the
settlement of the transactions contemplated by paragraph 1 above and paragraph 1
of that certain agreement dated as of the date hereof, between Icahn and Xxxx
Xxxxxxxx and his affiliated funds (the "Settlement Time"). Lions Gate
acknowledges and reasonably believes that the Claims and Expenses it is
releasing and the cases it is dismissing (including the matters set forth in the
last paragraph of Section 5 below) are no more valuable than those Icahn is
releasing and dismissing, and Icahn acknowledges and reasonably believes that
the Claims and Expenses it is releasing and the cases it is dismissing are no
more valuable than those Lions Gate is releasing and dismissing (including the
matters set forth in the last paragraph of Section 5 below).
5. Effective as of the Settlement Time, each party shall, and hereby does,
release each of the other parties and each of their present and former officers,
directors, shareholders, partners (limited or general), members, managers,
investment advisors, investment managers, employees, agents, attorneys,
successors and assigns from any and all liability, actions, charges, causes of
action, demands, damages, or claims, of any kind or character, in any way
relating to Lions Gate, any securities of Lions Gate, any disclosures made by
Lions Gate or any of its affiliates, any actions, decisions, or deliberations of
Lions Gate or its officers or directors or any of its affiliates, any purchase
or sale of Lions Gate securities, any filing, statement, action, discussion or
activity relating to or concerning Lions Gate, or any matter relating to or
arising from or in connection with any investment in Lions Gate (any of the
foregoing, "Claims"), including but not limited to all Claims for relief,
remuneration, sums of money, accounts or expenses of any kind whatsoever,
whether known or unknown, accrued or unaccrued or contingent or absolute(the
foregoing,including, without limitation, attorneys' fees and costs, including
any award of costs made in any proceeding in favor of any party, referred to
herein as "Expenses"), which heretofore has been or which hereafter may be
suffered or sustained, directly or indirectly, by the releasing party by reason
of any matter, fact or cause whatsoever relating to Lions Gate, any securities
of Lions Gate, any disclosures made by Lions Gate or any of its affiliates, any
actions, decisions, or deliberations of Lions Gate or its officers or directors
or any of its affiliates, any purchase or sale of Lions Gate securities, any
filing, statement, action, discussion or activity relating to or concerning
Lions Gate, or any matter relating to or arising from or in connection with any
investment in Lions Gate,from the beginning of time to the date of this
Agreement (but, subject to paragraph 8 hereof, this paragraph 5 does not apply
to any Claims arising under this Agreement). The release contemplated by this
paragraph 5 is intended to be as broad as permitted by law and is intended to,
and does, extinguish all Claims and Expenses of any kind whatsoever, whether in
law or equity or otherwise, that are based on facts or conditions or actions
that have existed or occurred at any time from the beginning of time to the date
of this Agreement. It is the intention of the parties to extinguish all Claims
and Expenses and, consistent with such intention, the parties waive any and all
rights, to the extent permitted by law, under Section 1542 of the California
Civil Code, if applicable, or any other applicable similar state law, federal
law or principle of common law, which may have the effect of limiting the
releases set forth in Sections 1 and 2 above. Section 1542 of the California
Code provides: "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR
DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING
THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR
HER SETTLEMENT WITH THE DEBTOR."
Lions Gate will use reasonable best efforts to secure from Xxxx Xxxxxxxxx,
Xxxxxxxxx Capital Management and their respective affiliates ("Xxxxxxxxx") and
each director of Lions Gate named in litigation referenced in paragraph 4 (each
a "Specified Director") a release in favor of Icahn in the same form as set
forth in the paragraph above and which includes a corresponding release of
Xxxxxxxxx or such Specified Director by Icahn. Lions Gate will, and hereby does,
indemnify (and will advance expenses on behalf of) Icahn for the amount of any
and all Claims or Expenses awarded to, or sought by, Xxxxxxxxx or any Specified
Director, or incurred by Icahn (whether before or after the date of this
Agreement) in any threatened, pending or completed claim, action, suit,
arbitration or other proceeding relating to Lions Gate. Lions Gate's indemnity
obligations with respect to Xxxxxxxxx or any Specified Director will cease with
respect to all Claims or Expenses following the date that Xxxxxxxxx or such
Specified Director provides such release to Icahn.
6. Effective as of the date hereof and ending on the last day of the Specified
Period, each party hereby agrees that it shall not, directly or indirectly,
make, or cause to be made, any statement or announcement that relates to and
constitutes an ad hominem attack on, or relates to and disparages, any of the
other parties or their directors, officers, employees or affiliates, on or
following the date of this Agreement with respect to any matter directly or
indirectly relating to Lions Gate: (A) in any document or report filed with or
furnished to the SEC or any other governmental agency, (B) in any press release
or other publicly available format, or (C) to any journalist or member of the
media (including without limitation, in a television, radio, newspaper or
magazine interview).
7. The parties will reasonably cooperate and consult with one another with
respect to regulatory and other filings in connection with this Agreement and
the transactions contemplated hereby. Each party shall execute such other
documents and take such other actions as are reasonably requested by another
party hereto to carry out the provisions hereof and the transactions
contemplated hereby. Each party acknowledges that the other parties are
obligated to disclose and file a copy of this Agreement pursuant to US and
Canadian securities laws and agrees that nothing in this Agreement shall
restrict the parties' ability to make such disclosures or filings.
8. Each party has conducted its own investigation with respect to the Shares,
acknowledges that the other parties may be in possession of material, nonpublic
information regarding Lions Gate and agrees that no other party shall have any
obligation to disclose such information to such party.
9. Representations and Warranties of Icahn. Icahn hereby represents and warrants
to Lions Gate that:
(a) Neither Icahn nor, if applicable, any fund, account or other Person on
behalf of which it is selling, is Canadian. Icahn is not a nominee, agent,
trustee, executor, administrator or other legal representative for one or more
other Canadian Persons having a direct beneficial interest in the Shares. Icahn
did not acquire the Shares, including from an Affiliated fund or account of
Icahn, in order to sell such Shares to Lions Gate. "Canadian" shall mean any
Person who is a resident of or otherwise in Canada or is, to Icahn's knowledge,
shown on the books of Lions Gate as having an address in Canada. "Person" shall
mean any individual, corporation, company, association, partnership, limited
liability company, joint venture, trust or unincorporated organization, or a
government or any agency or political subdivision thereof.
(b) Icahn has good, valid and marketable title to all of the Shares, free and
clear of any and all Encumbrances. Icahn has the sole right to dispose or direct
the disposition of the Shares. "Encumbrance" shall mean any security interest,
claim, pledge, lien, charge, voting agreement, proxy, mortgage, conditional sale
agreement, title retention agreement, option, adverse claim of ownership or use,
any restriction on ownership, use, voting or transfer, or any other encumbrance
of any kind, character or description whatsoever.
(c) Icahn is not as of the date hereof, and will not become, a party to any
agreement, arrangement or understanding with any Person which could result in
Lions Gate having any obligation or liability for any brokerage fees,
commissions, underwriting discounts or other similar fees or expenses relating
to the transactions contemplated by this Agreement.
10. Icahn will cause all Shares as to which Icahn has voting rights to be
present at the annual general meeting of shareholders to be held September 13,
2011, or any adjournment or postponement thereof (provided that Icahn shall have
no obligations under this Section 10 after October 1, 2011) and will abstain
from voting in the election of directors and may vote his shares or abstain from
voting in his discretion on any other matter before such meeting. For the
avoidance of doubt, Icahn agrees not to propose any business to such meeting.
11. Each party agrees that, in the event that any of them were to violate any
provision of this Agreement or fail to perform any obligation under this
Agreement in accordance with its specific terms, the other parties would suffer
irreparable injury, for which there may be no adequate remedy at law.
Consequently, each party agrees that, in the event of a breach or threatened
breach of this Agreement by any party, the other parties shall be entitled, in
addition to any other remedies to which they may be entitled at law, to
equitable relief, including an injunction, to prevent any breaches and to
enforce specifically this Agreement's terms and provisions. Each party also
agrees that any such equitable relief may be sought without the obligation of
posting any bond or surety. This Agreement shall be governed by the laws of the
State of New York and applicable federal United States laws. Each party agrees
to submit to personal and exclusive jurisdiction of the courts located in New
York County, New York.
LIONS GATE ENTERTAINMENT CORP.
By: ________________________________ __________________________________
Name: XXXX X. ICAHN, individually and on
Title: behalf of his affiliated funds
__________________________________
XXXXX XXXXX, individually and on
behalf of his affiliated funds
0918988 B.C. Ltd
By: _____________________________
Name:
Title:
0918989 B.C. Ltd
By: _____________________________
Name:
Title:
