EXHIBIT A
THE OPTIONS AND THE SHARES OF COMMON STOCK AND PREFERRED STOCK SUBSCRIBED FOR
BY THIS AGREEMENT AND THE SHARES OF PREFERRED STOCK ISSUABLE UPON EXERCISE OF
SUCH OPTIONS WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY OTHER APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE OFFERED
OR SOLD UNLESS REGISTERED THEREUNDER OR UNLESS AN EXEMPTION FROM SUCH
REGISTRATION IS AVAILABLE. TRANSFER OF SUCH OPTIONS AND SHARES IS ALSO
RESTRICTED BY THE TERMS OF THIS AGREEMENT AND BY THE TERMS OF THE
STOCKHOLDERS AGREEMENT AND/OR OPTION AGREEMENT WITH CARSO HOLDINGS
CORPORATION.
AMENDED AND RESTATED OPTION EXCHANGE,
CONTRIBUTION AND SUBSCRIPTION AGREEMENT
This AMENDED AND RESTATED OPTION EXCHANGE, CONTRIBUTION AND
SUBSCRIPTION AGREEMENT (this "Agreement"), dated as of October 13, 2004, is
entered into by and among Xxxx Xxxxxxx, an individual (the "Investor"), Green
Equity Investors IV, L.P. ("GEI") and Carso Holdings Corporation, a Delaware
corporation (the "Company").
X. Xxxxxxxx, GEI and the Company entered into that certain Option
Exchange, Contribution and Subscription Agreement, dated as of March 28, 2004
(the "Original Agreement");
B. Investor is currently a shareholder in Hollywood Entertainment
Corporation, an Oregon corporation ("Hollywood"), and is the owner of the
number of shares of common stock of Hollywood ("Hollywood Common Shares") set
forth under the caption "Rollover Shares" in SCHEDULE 1 attached hereto (the
"Rollover Shares");
C. Investor is also an employee of Hollywood and is the holder of a
number of options ("Hollywood Options") to acquire the number of Hollywood
Common Shares set forth under the caption "Rollover Options" in SCHEDULE 1
attached hereto (the "Rollover Options") at the exercise prices per share set
forth under the caption "Exercise Price Per Share" therein;
D. Hollywood, the Company and Hollywood Merger Corporation, an
Oregon corporation and a wholly owned subsidiary of the Company formerly
named Cosar Corporation ("Merger Sub"), entered into that certain Agreement
and Plan of Merger, dated as of March 28, 2004 (the "Original Merger
Agreement");
E. Concurrently with the execution and delivery of this Agreement,
Hollywood, the Company and Merger Sub are entering into that certain Xxxxxxx
and Restated Agreement and Plan of Merger, dated contemporaneously herewith
(the "Merger Agreement"), pursuant to which Merger Sub shall merge with and
into Hollywood, with Hollywood as the surviving corporation (the "Merger");
F. In connection with the amendment and restatement of the Original
Merger Agreement, Investor, GEI and the Company are entering into this
Agreement.
G. In connection with the Merger, Investor has entered into that
certain Employment Agreement, dated as of March 28, 2004 (as modified by that
certain letter agreement dated as of the date hereof), with Merger Sub (the
"Employment Agreement").
H. Subject to the terms and conditions of this Agreement, Investor
desires, prior to the Merger, to contribute to the Company the Rollover
Shares in exchange (the "Contribution") for newly issued shares of common
stock, par value $0.01 per share (the "Common Shares"), of the Company and
newly issued shares of 10% junior redeemable cumulative participating
preferred stock, original liquidation preference $1,000 per share (the
"Junior Preferred Shares"), of the Company, in the amounts set forth under
the caption "Contribution Shares" in SCHEDULE 1 attached hereto;
F. Subject to the terms and conditions of this Agreement, Investor
also desires, prior to the Merger, to exchange (the "Exchange") the Rollover
Options for options (the "Exchange Options") to acquire Junior Preferred
Shares in the amount set forth under the caption "Exchange Options" in
SCHEDULE 1 attached hereto;
G. Subject to the terms and conditions of this Agreement, GEI
desires, prior to the Merger, to contribute cash to the Company in exchange
for newly issued Common Shares, Junior Preferred Shares and shares of senior
redeemable cumulative exchangeable preferred stock, original liquidation
preference $1,000 per share (the "Senior Preferred Shares"), of the Company;
H. For United States federal income tax purposes, it is intended
that the contribution of the Rollover Shares to the Company in exchange for
newly issued Common Shares and Junior Preferred Shares, taken together with
the contribution by GEI (or an affiliate GEI) of cash to the Company in
exchange for newly issued Common Shares, Junior Preferred Shares and Senior
Preferred Shares will qualify as a transaction described in Section 351(a) of
the Internal Revenue Code of 1986, as amended; and
I. In connection with the consummation of the transactions
contemplated by this Agreement and the Merger Agreement, the Company,
Investor, GEI and certain other persons will enter into a Stockholders
Agreement substantially in the form attached as EXHIBIT A hereto (the
"Stockholders Agreement");
NOW, THEREFORE, in order to implement the foregoing and in
consideration of the mutual representations, warranties, covenants and
agreements contained herein and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties hereto
agree as follows.
1. EXCHANGE, CONTRIBUTION AND SUBSCRIPTION.
1.1 CONTRIBUTION AND EXCHANGE.
(a) On the terms and conditions set forth herein, Investor
agrees to subscribe for, and the Company agrees to issue to Investor, the
number of Common Shares and Junior Preferred Shares (collectively, the
"Contribution Shares") set forth under the caption "Contribution Shares" in
SCHEDULE 1 in exchange for the Contribution by Investor of the number of
Rollover Shares set forth in SCHEDULE 1.
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(b) On the terms and conditions set forth herein, and in
connection with Investor's employment by the Company pursuant to the
Employment Agreement, the Company hereby agrees to issue to Investor a number
of Exchange Options set forth under the caption "Exchange Options" in
SCHEDULE 1 hereto in exchange for the surrender and cancellation of the
Rollover Options. The Exchange Options shall be issued pursuant to an Option
Agreement substantially in the form attached as EXHIBIT B hereto (the "Option
Agreement"). The Exchange Options shall be fully and immediately exercisable
upon issuance. The original exercise price per Junior Preferred Share
pursuant to each Exchange Option shall be as set forth under the caption
"Exchange Option Exercise Price Per Share" in SCHEDULE 1 and shall be
adjusted as provided in the Option Agreement.
(c) On the terms and conditions set forth herein, XXX agrees to
subscribe for, and the Company agrees to issue to GEI (the "GEI
Contribution"), (i) 32,000,000 Common Shares (the "GEI Common Shares") in
exchange for the contribution by GEI of $10,000,000, (ii) 49,640 Junior
Preferred Shares (the "GEI Junior Preferred Shares") in exchange for the
contribution by XXX of $49,640,000 and (iii) 100,360 Senior Preferred Shares
(the "GEI Senior Preferred Shares") in exchange for the contribution by GEI
of $100,360,000. For purposes of this Agreement, "GEI Cash" means the
aggregate amount of cash contributed by GEI to the Company pursuant to the
preceding sentence. Notwithstanding anything in this Agreement to the
Contrary, GEI may assign the right to acquire up to an aggregate of 50% of
each of the GEI Common Shares, GEI Junior Preferred Shares and GEI Senior
Preferred Shares to one or more equity participants who are either Accredited
Investors (as defined in Rule 501(a) promulgated under the Securities Act of
1933, as amended (the "Securities Act")) or Qualified Institutional Buyers
(as defined in Rule 144A promulgated under the Securities Act) (collectively
the "Equity Participants"); PROVIDED, that (A) such Equity Participants shall
be reasonably satisfactory to Investor, (B) such Equity Participants will
enter into a subscription agreement on substantially the same terms as the
GEI Contribution hereunder and (C) no such assignment shall relieve GEI of
its obligations under this Section 1.1(c).
1.2 CLOSING. The closing (the "Closing") of the Contribution, Exchange
and GEI Contribution shall occur immediately prior to the closing of the Merger;
provided that the Company shall provide at least three (3) business days
notice of such time and date to Investor and GEI. The Closing shall take
place at the offices of Xxxxxx & Xxxxxxx LLP, 000 Xxxx Xxxxx Xxxxxx, Xxxxx
0000, Xxx Xxxxxxx, XX 00000-2007 or such other place determined by the
parties.
1.3 FAILURE TO CONSUMMATE THE MERGER. In the event that after the
Contribution, Exchange and GEI Contribution, the Merger fails to be consummated
for any reason whatsoever and the Merger Agreement is terminated, the parties
hereto agree that concurrently with the termination of the Merger Agreement,
regardless of the price at which the Hollywood Common Shares are quoted at that
time on Nasdaq or any other national securities exchange on which the Hollywood
Common Shares are listed, (i) the Company shall return to Investor all of the
Rollover Shares and Rollover Options and Investor shall return to the Company
all of the Exchange Options and all of the Common Shares and Junior Preferred
Shares constituting the Contribution Shares and (ii) the Company shall return
the GEI Cash to GEI and GEI shall return to the Company all of the GEI Common
Shares, GEI Junior Preferred Shares and GEI Senior Preferred Shares. In such
event, (x) Investor shall have no claim against the Company other than (i) the
right to receive such Rollover Shares and Rollover Options upon return of the
Contribution Shares and Exchange Options and (ii) the right to have expenses
reimbursed pursuant to Section 15 hereof and (y) GEI shall have no claim against
the Company other than the right to receive the GEI Cash upon return of the GEI
Common Shares, GEI Junior Preferred Shares and GEI Senior Preferred Shares.
1.4 CONDITIONS TO CLOSING. The Closing of the Contribution, Exchange
and GEI Contribution shall be subject to the following conditions, unless
waived in writing by the Company and Investor (in the case of Sections 1.4(a),
(b), (c), (h), (i) and (j)) or by the Company (in the case of Sections 1.4(d)
and (e)) or by Investor and GEI (in the case of Section 1.4(f) and (g)):
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(a) NO LAW OR ORDER. No supranational, federal, state, local or
foreign law, rule, regulation, judgment, code, ruling, statute, order, decree,
injunction, ordinance or other legal requirement (including any arbitral
decision or award) ("Law") shall have been enacted, entered, issued or
promulgated (and remain in effect) by any supranational, federal, state,
local or foreign government, court, administrative agency or commission or
other governmental or regulatory authority or instrumentality ("Governmental
Entity") which prohibits or materially restricts the consummation of the
transactions contemplated hereby.
(b) WAITING PERIODS; NO LEGAL PROCEEDINGS. Any applicable waiting
periods or consents under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976, as amended (the "HSR Act"), relating to the Merger and/or the acquisition
by Investor and/or GEI of Common Shares, Junior Preferred Shares or Senior
Preferred Shares pursuant to this Agreement or upon exercise of the Exchange
Options, as applicable, shall have expired, been terminated or been granted,
as applicable and no Governmental Entity (as defined in the Merger Agreement)
shall have notified any party to this Agreement that it intends to commence
proceedings to restrain or prohibit the transactions contemplated hereby or
force rescission, unless such Governmental Entity shall have withdrawn such
notice and abandoned any such proceedings prior to the time which otherwise
would have been the Closing date.
(c) MERGER AGREEMENT CONDITIONS. The conditions to the Merger
Agreement shall have been satisfied or waived and the parties to the Merger
Agreement shall have represented that they intend to consummate the Merger
immediately following consummation of the Contribution, Exchange and GEI
Contribution.
(d) REPRESENTATIONS AND WARRANTIES OF INVESTOR. All
representations and warranties in this Agreement by Investor shall be true and
correct in all material respects on the date when made and on and as of the
Closing date with the same effect as if made on and as of the Closing date.
(e) COVENANTS AND AGREEMENTS OF INVESTOR. Investor shall have
performed or complied in all material respects with all covenants and
conditions contained in this Agreement or in any agreement, certificate or
instrument to be executed pursuant hereto which are required to be performed or
complied with at or prior to the Closing.
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(f) REPRESENTATIONS AND WARRANTIES OF THE COMPANY. All
representations and warranties in this Agreement by the Company shall be true
and correct in all material respects on the date when made and on and as of the
Closing date with the same effect as if made on and as of the Closing date.
(g) COVENANTS AND AGREEMENTS OF THE COMPANY. The Company shall
have performed or complied in all material respects with all covenants and
conditions contained in this Agreement or in any agreement, certificate or
instrument to be executed pursuant hereto which are required to be performed
or complied with at or prior to the Closing.
(h) STOCKHOLDERS AGREEMENT. Investor and the other parties to the
Stockholders Agreement shall have executed and delivered the Stockholders
Agreement to the Company.
(i) REPRESENTATIONS AND WARRANTIES OF GEI. All representations
and warranties in this Agreement by GEI shall be true and correct in all
material respects on the date when made and on and as of the Closing date with
the same effect as if made on and as of the Closing date.
(j) COVENANTS AND AGREEMENTS OF GEI. GEI shall have performed or
complied in all material respects with all covenants and conditions contained
in this Agreement or in any agreement, certificate or instrument to be executed
pursuant hereto which are required to be performed or complied with at or
prior to the Closing.
1.5 COMPANY DELIVERIES.
(a) At the Closing, the Company shall deliver to Investor the
following:
(i) stock certificates representing the Common Shares and
Junior Preferred Shares to be received by Investor;
(ii) an Option Agreement with respect to the Exchange Options
to be received by Investor;
(iii) a certificate of the Company confirming the fulfillment
of the conditions set forth in Sections 1.4(f) and (g);
and
(iv) a check for $400.00 made out to Investor.
(b) At the Closing, the Company shall deliver to GEI the following:
(i) stock certificates for the GEI Common Shares, GEI Junior
Preferred Shares and GEI Senior Preferred Shares; and
(ii) a certificate of the Company confirming the fulfillment
of the conditions set forth in Sections 1.4(f) and (g).
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1.6 INVESTOR DELIVERIES. At the Closing, Investor shall deliver to the
Company the following:
(a) certificate(s) evidencing the Rollover Shares, endorsed in
blank (or together with duly executed stock powers in form and substance
reasonably satisfactory to the Company);
(b) option agreement(s) evidencing the Rollover Options and any
other documents reasonably requested by the Company with respect to the
Rollover Options and the Exchange Options;
(c) a copy of the Stockholders Agreement, duly executed by
Xxxxxxxx; and
(d) a certificate of Investor confirming the fulfillment of the
conditions set forth in Sections 1.4(d) and (e).
1.7 GEI DELIVERIES. At the Closing, GEI shall deliver to the Company:
(a) $160,000,000 by wire transfer of immediately available funds;
and
(b) a copy of the Stockholders Agreement, duly executed by XXX.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
hereby represents and warrants to Investor and GEI as follows:
2.1 ORGANIZATIONAL MATTERS. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, having full corporate power and authority to own its properties and
to carry on its business as conducted. The Company has made available to
Investor true and correct copies of the Certificate of Incorporation and
By-laws of the Company as in effect on the date hereof. Since its formation,
the Company has conducted no business or operations other than the
negotiation, execution and delivery of the Original Merger Agreement, the
Merger Agreement and the Ancillary Documents (as defined in the Merger
Agreement) and the consummation of the transactions contemplated hereby and
thereby and actions incident thereto.
2.2 AUTHORITY. The Company has the requisite corporate power and
authority to enter into and deliver this Agreement, perform its obligations
herein, and consummate the transactions contemplated hereby. The Company has
duly executed and delivered this Agreement. This Agreement is a valid, legal
and binding obligation of the Company enforceable against the Company in
accordance with its terms, except to the extent that enforceability may be
limited by applicable bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally and subject to general principles
of equity (regardless of whether such enforcement is considered in a
proceeding at law or at equity).
2.3 SHARES DULY AUTHORIZED. All of the Common Shares, Junior Preferred
Shares and Senior Preferred Shares to be issued to Investor and GEI pursuant
to this Agreement, when issued and delivered in accordance with the terms of
this Agreement, will be duly authorized, validly issued, fully paid and
non-assessable and shall be free and clear of all Liens (as defined in
Section 3.1(b)), other than Liens created pursuant to the Stockholders
Agreement. All of the Exchange Options to be issued to Investor pursuant to
this Agreement, when issued and delivered in accordance with the terms of
this Agreement, will be duly authorized. All of the Junior Preferred Shares
issuable upon exercise of the Exchange Options, will upon payment of the
exercise price therefore, be duly authorized, validly issued, fully paid and
non-assessable and shall be free and clear of all Liens (as defined in
Section 3.1(b)), other than Liens created pursuant to the Stockholders
Agreement.
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2.4 GOVERNMENTAL AUTHORITIES. The execution, delivery and performance
by the Company of this Agreement, and the consummation by the Company of the
transactions contemplated hereby will not require any consent, approval,
action, order, authorization, or permit of, or registration or filing with,
any Governmental Entity (as defined in the Merger Agreement), other than (a)
compliance with any applicable requirements of the HSR Act; (b) compliance
with any applicable requirements of the Securities Act and the Securities
Exchange Act of 1934, as amended (the "Exchange Act"); (c) such as may be
required under any applicable state securities or Blue Sky Laws; and (d)
other consents, approvals, actions, orders, authorizations, registrations,
declarations, filings and permits which, if not obtained or made, would not
have a material adverse effect on the ability of the Company to consummate
the transactions contemplated by this Agreement.
2.5 NON-CONTRAVENTION. The execution, delivery and performance the
Company of this Agreement and the consummation by the Company of the
transactions contemplated hereby do not and will not (a) contravene or conflict
with the Company's Certificate of Incorporation or By-laws, (b) assuming
compliance with the matters referred to in Section 2.4, contravene or conflict
with or constitute a violation of any provision of any law binding upon or
applicable to the Company or by which any of its properties is bound or
affected, (c) constitute a default under (or an event that with notice or lapse
of time or both could reasonably be expected to become a default) or give rise
(with or without notice or lapse of time or both) to a right of termination,
amendment, cancellation or acceleration under any agreement, contract, note,
bond, mortgage, indenture, lease, franchise, permit or other similar
authorization or joint venture, limited liability or partnership agreement or
other instrument binding upon the Company, other than, in the case of clauses
(b) and (c) any items that have not had, and would not be reasonably expected
to have, individually or in the aggregate, a material adverse effect on the
ability of the Company to consummate the transactions contemplated by this
Agreement.
2.6 NO GENERAL SOLICITATION. The Company has not conducted any general
solicitation or general advertisement in connection with the Contribution,
the Exchange, the GEI Contribution or an investment in the Company by any
person.
2.7 CAPITALIZATION. After giving effect to the Contribution, the GEI
Contribution and the Exchange, respectively, (a) there will be 64,000,000
Common Shares outstanding on a fully-diluted basis, and (b) GEI and its
affiliates (together with the Equity Participants, as applicable) will own,
in the aggregate, (i) 32,000,000 Common Shares; (ii) Junior Preferred Shares
with an aggregate original liquidation preference equal to the sum of (A) the
aggregate liquidation preference of the Junior Preferred Shares acquired by
Investor at the Closing pursuant to this Agreement plus (B) an amount equal
to the product of (x) the aggregate number of Junior Preferred Shares
issuable upon exercise of the Exchange Options multiplied by (y) the amount
of the original liquidation preference per Junior Preferred Share minus the
original Exchange Option exercise price per share specified on Schedule 1;
and (iii) all of the outstanding Senior Preferred Shares.
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2.8 ACCURACY OF INFORMATION. As of the date hereof and as of the
Closing, the representations and warranties of the Company contained herein and
all information provided by the Company to the Investor and GEI concerning the
Company prior to the effective time of the Merger do not contain any untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in light of the circumstances under
which they were made, not misleading. If there should be any material
changes in such information prior to the Company issuing the Contribution
Shares or Exchange Options, the Company will promptly provide Investor and
GEI with such information, provided that the Company makes no representations
about information in public documents filed by Hollywood.
3. REPRESENTATIONS AND WARRANTIES OF INVESTOR AND GEI.
3.1 REPRESENTATIONS AND WARRANTIES OF INVESTOR. Investor hereby
represents and warrants to the Company and GEI as follows.
(a) CAPACITY. Investor, if a natural person, is of legal age,
competent to enter into a contractual obligation, and a citizen
of the United States of America. The principal place of
business or principal residence of Investor is as shown on the
signature page of this Agreement.
(b) OWNERSHIP OF THE ROLLOVER SHARES AND ROLLOVER OPTIONS. Except
as set forth in SCHEDULE 1 hereto, Investor is the sole record
and beneficial owner of the Rollover Shares and Rollover
Options set forth in SCHEDULE 1 hereto, free and clear of any
claim, lien, security interest, mortgage, deed of trust,
pledge, charge, conditional sale or other title retention
agreement, lease, preemptive right, right of first refusal,
option, restriction, tenancy, easement, license or other
encumbrance of any kind ("Liens") other than Liens created by
or under (i) this Agreement, (ii) the Amended and Restated
Voting Agreement, dated as of the date hereof, between Investor
and the Company (the "Voting Agreement") and (iii) the Security
Agreement, dated as of July 15, 2003 (the "Security
Agreement") by and between Investor and Zions First National
Bank ("Lender") relating to a loan by Lender to Boards Video
Company, LLC (the "Loan"). Prior to the Closing, Investor
shall take such steps as may be necessary so that, as of the
Closing Date, Investor shall be the sole record and beneficial
owner of the Rollover Shares and Rollover Options set forth in
SCHEDULE 1 hereto, free and clear of all Liens other than
Liens created by or under this Agreement and the Voting
Agreement. Neither Investor nor any of its affiliates is a
party to, or bound by, any contract, arrangement, agreement,
instrument or order (other than this Agreement, the Voting
Agreement, and the Security Agreement) (i) relating to the
issuance, sale, repurchase, assignment, or other transfer of
any capital stock or equity securities of Hollywood (including
securities convertible into or exchangeable for such capital
stock or equity securities, warrants, subscriptions, options
and other rights to acquire such capital stock or equity
securities) or the granting of preemptive rights in connection
with any such issuance or sale, (ii) relating to the receipt
of dividends, proxy rights, or voting rights of any capital
stock or other equity securities of Hollywood, or (iii)
relating to rights to registration under the Securities Act or
the Exchange Act of any capital stock or equity securities of
Hollywood.
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(c) AUTHORITY. Investor has the requisite power and authority to
deliver this Agreement, perform Investor's obligations herein,
and consummate the transactions contemplated hereby. Investor
has duly executed and delivered this Agreement. This Agreement
is a valid, legal and binding obligation of Investor
enforceable against Investor in accordance with its terms,
except to the extent that enforceability may be limited by
applicable bankruptcy, insolvency or similar laws affecting the
enforcement of creditors rights generally and subject to
general principles of equity (regardless of whether such
enforcement is considered in a proceeding at law or at
equity).
(d) INVESTOR INTENT. Except as otherwise contemplated by
Section 5(b) hereof, Investor is acquiring the Common Shares,
the Junior Preferred Shares, the Exchange Options and, upon
exercise of the Exchange Options, the Junior Preferred Shares
issuable pursuant thereto, for Investor's own account as
principal, for investment purposes only, not for any other
person or entity and not for the purpose of resale or
distribution. Investor is not subscribing for the Common
Shares, the Junior Preferred Shares or the Exchange Options in
a fiduciary capacity.
(e) FINANCIAL STATUS.
(i) Investor is an Accredited Investor (as defined in
Rule 501(a)(3), (5), (6), (7) or (8) of Regulation D
promulgated under the Securities Act).
(ii) Investor is able to bear the economic risk of an
investment in the Contribution Shares, the Exchange
Options and the Junior Preferred Shares issuable upon
exercise of the Exchange Options for an indefinite period
of time, has adequate means of providing for his or her
current financial needs and personal contingencies, has
no need for liquidity in the investment in the
Contribution Shares, the Exchange Options or the Junior
Preferred Shares issuable upon exercise of the Exchange
Options, understands that Investor may not be able to
liquidate his or her investment in the Company in an
emergency, if at all, and can afford a complete loss of
such investment.
(iii) Investor has delivered to the Company an executed
Investment Qualification Questionnaire in the form
attached hereto. The information contained therein is
complete and accurate in all material respects.
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(f) NO GENERAL SOLICITATION. Investor has received no general
solicitation or general advertisement in connection with the
Contribution or Exchange or an investment in the Company.
Investor has received no other representations or warranties
from the Company or any other person acting on behalf of the
Company, other than those contained in this Agreement.
(g) NO RELIANCE. Investor did not look to, or rely in any manner
upon, the Company, Hollywood or any of their respective
affiliates, directors, officers, employees or representatives
for advice about tax, financial or legal consequences of a
purchase of or investment in the Contribution Shares, the
Exchange Options or the Junior Preferred Shares issuable upon
exercise of the Exchange Options, and none of the Company,
Hollywood or any of their respective affiliates, directors,
officers, employees or representatives has made or is making
any representations to Investor about, or guaranties of, tax,
financial or legal outcomes of a purchase of or an investment
in the Contribution Shares, the Exchange Options or the Junior
Preferred Shares issuable upon exercise of the Exchange
Options.
(h) OWNERSHIP OF HOLLYWOOD COMMON SHARES AND RELATED MATTERS.
Investor owns, and at all times from the date hereof through
the Closing Investor shall own, no more than 12% of the
Hollywood Common Shares on a fully diluted basis, assuming the
exercise of all options owned by Investor to acquire Hollywood
Common Shares (without regard to the exercise price under such
options or whether such options are currently vested or
exercisable). Investor will not enter into any agreement or
arrangement with other holders of Hollywood Common Shares (or
options to acquire Hollywood Common Shares) that would cause
any of the other transactions contemplated hereby or by the
Merger Agreement to constitute (a) a control share acquisition
under Sections 60.801 through 60.816 of the OBCA (as defined
in the Merger Agreement) or any applicable Takeover Statute
(as defined in the Merger Agreement) or (b) a prohibited
business combination under Section 60.835 of the OBCA or any
applicable Takeover Statute.
3.2 REPRESENTATIONS AND WARRANTIES OF GEI. GEI hereby represents and
warrants to the Company and Investor as follows:
(a) AUTHORITY. GEI has the requisite power and authority to
deliver this Agreement, perform GEI's obligations herein, and
consummate the transactions contemplated hereby. XXX has duly
executed and delivered this Agreement and has obtained the
necessary authorization to execute and deliver this Agreement
and to perform GEI's obligations herein and to consummate the
transactions contemplated hereby. This Agreement is a valid,
legal and binding obligation of GEI enforceable against GEI in
accordance with its terms, except to the extent that
enforceability may be limited by applicable bankruptcy,
insolvency or similar laws affecting the enforcement of
creditors; rights generally and subject to general principles
of equity (regardless of whether such enforcement is
considered in a proceeding at law or at equity).
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(b) GEI INTENT. Except as contemplated by Section 1.1(c), GEI is
acquiring the GEI Common Shares, GEI Junior Preferred Shares
and GEI Senior Preferred Shares for GEI's own account, for
investment purposes only, not for any other person or entity
and not for the purpose of resale or distribution.
(c) NO GENERAL SOLICITATION. GEI has received no general
solicitation or general advertisement in connection with the
GEI Contribution or an investment in the Company. GEI has
received no other representations or warranties from the
Company or any other person acting on behalf of the Company,
other than those contained in this Agreement.
(d) ACCREDITED INVESTOR. GEI is an Accredited Investor (as defined
in Rule 501(a)(3), (5), (6), (7) or (8) of Regulation D
promulgated under the Securities Act).
(e) INVESTMENT COMPANY. GEI is not an Investment Company required
to be registered under the Investment Company Act of 1940, as
amended, and, upon consummation of the GEI Contribution, the
Company will not be a company controlled by an Investment
Company required to be registered under such Act.
4. AGREEMENTS AND ACKNOWLEDGEMENTS OF INVESTOR AND GEI. Each of
Investor and GEI hereby agree and acknowledge, each with respect to itself only
and not with respect to the other, to the Company as follows:
4.1 NO REGISTRATION. It understands and agrees that the Contribution
Shares, the Exchange Options and the Junior Preferred Shares issuable upon
exercise of the Exchange Options, the GEI Common Shares, the GEI Junior
Preferred Shares and the GEI Senior Preferred Shares, as applicable, are being,
or will be, acquired in a transaction not involving any public offering within
the meaning of the Securities Act, in reliance on an exemption therefrom. It
understands that the Contribution Shares, the Exchange Options and the Junior
Preferred Shares issuable upon exercise of the Exchange Options, the GEI Common
Shares, the GEI Junior Preferred Shares and the GEI Senior Preferred Shares, as
applicable, have not been, and will not be, approved or disapproved by the
Securities and Exchange Commission or by any other federal or state agency, and
that no such agency has passed on the accuracy or adequacy of disclosures made
to it by the Company. No federal or state governmental agency has passed on or
made any recommendation or endorsement of the Contribution Shares, the Exchange
Options, the Junior Preferred Shares issuable upon exercise of the Exchange
Options, the GEI Common Shares, the GEI Junior Preferred Shares and the GEI
Senior Preferred Shares, as applicable, or an investment in the Company.
11
4.2 LIMITATIONS ON DISPOSITION AND RESALE. It understands and
acknowledges that the Contribution Shares, the Exchange Options and the Junior
Preferred Shares issuable upon exercise of the Exchange Options, the GEI Common
Shares, the GEI Junior Preferred Shares and the GEI Senior Preferred Shares, as
applicable, have not been and will not be registered under the Securities Act or
the securities laws of any state and, unless the Contribution Shares, the
Exchange Options and/or the Junior Preferred Shares issuable upon exercise of
the Exchange Options, the GEI Common Shares, the GEI Junior Preferred Shares and
the GEI Senior Preferred Shares, as applicable, are so registered, they may not
be offered, sold, transferred or otherwise disposed of except pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act and any applicable securities laws of any
state or foreign jurisdiction. It understands that it may not be possible to
liquidate its investment in the Company and agrees not to sell, transfer or
otherwise dispose of the Contribution Shares, the Exchange Options or the Junior
Preferred Shares issuable upon exercise of the Exchange Options, the GEI Common
Shares, the GEI Junior Preferred Shares and the GEI Senior Preferred Shares, as
applicable, unless such Contribution Shares, the Exchange Options or the Junior
Preferred Shares issuable upon exercise of the Exchange Options, GEI Common
Shares, GEI Junior Preferred Shares or GEI Senior Preferred Shares, as
applicable, have been so registered or an exemption from the requirement of
registration is available under the Securities Act and any applicable state
securities laws. It further acknowledges and agrees that the ability to dispose
of the Contribution Shares, the Exchange Options or the Junior Preferred Shares
issuable upon exercise of the Exchange Options, the GEI Common Shares, the GEI
Junior Preferred Shares and the GEI Senior Preferred Shares, as applicable, will
be subject to restrictions contained in the Stockholders Agreement. It
recognizes that there will not be any public trading market for the Common
Shares, Junior Preferred Shares or Senior Preferred Shares and, as a result, it
may be unable to sell or dispose of its interests in the Company. It further
acknowledges and agrees that, except as may be set forth in the Stockholders
Agreement, the Company shall have no obligation to register the Contribution
Shares, the Exchange Options or the Junior Preferred Shares issuable upon
exercise of the Exchange Options, the GEI Common Shares, the GEI Junior
Preferred Shares or the GEI Senior Preferred Shares, as applicable.
4.3 LEGEND. (a) Investor acknowledges and agrees that the Exchange
Options received in the Exchange will bear the following legend (or one to
substantially similar effect):
"This option has not been registered under the U.S. Securities
Act of 1933, as amended, (the "Securities Act"). The option has
been acquired for investment and may not be sold, pledged or
hypothecated in the United States in the absence of an effective
registration statement for the option under the Securities Act or
an exemption thereunder. This option is subject to restrictions
contained in an Option Agreement, dated as of _________, 200_.
The Option Agreement contains, among other things, certain
provisions relating to the transfer of this option. The shares
issuable upon exercise of this option will be subject to
restrictions contained in a Stockholders Agreement, dated as of
________, 200_. The Stockholders Agreement contains, among other
things, certain provisions relating to the transfer and voting of
the shares issuable upon exercise of this option. No transfer,
sale, assignment, pledge hypothecation or other disposition of
this option or the shares issuable upon exercise hereof, directly
or indirectly, may be made except in accordance with the
provisions of such Option Agreement and/or such Stockholders
Agreement. The holder of this option, by acceptance hereof,
agrees to be bound by all of the provisions of such Option
Agreement and such Stockholders Agreement applicable to this
option and the shares issuable upon exercise hereof."
12
(b) It acknowledges and agrees that the Common Shares, Junior
Preferred Shares and Senior Preferred Shares received in the Contribution and
the GEI Contribution and any Junior Preferred Shares received upon exercise of
the Exchange Options represented by physical certificates will bear the
following legend (or one to substantially similar effect):
"The shares represented by this certificate (the "Shares") have
not been registered under the U.S. Securities Act of 1933, as
amended (the "Securities Act"). The Shares have been acquired
for investment and may not be sold, pledged or hypothecated in
the United States in the absence of an effective registration
statement for the Shares under the Securities Act or an exemption
thereunder. The Shares are subject to restrictions contained in
a Stockholders Agreement, dated as of _________, 200_. The
Stockholders Agreement contains, among other things, certain
provisions relating to the transfer of the Shares. No transfer,
sale, assignment, pledge hypothecation or other disposition of
the Shares, directly or indirectly, may be made except in
accordance with the provisions of such Stockholders Agreement.
The holder of this certificate, by acceptance of this
certificate, agrees to be bound by all of the provisions of such
Stockholders Agreement applicable to the Shares."
4.4 NEWLY FORMED ENTITY. It recognizes that the Company was only
recently formed and, accordingly, has no financial or operating history and that
the investment in the Company is extremely speculative and involves a high
degree of risk.
4.5 INFORMATION REGARDING THE COMPANY. It acknowledges that (a) the
Company has made available, a reasonable time prior to the date of this
Agreement, information concerning the Company sufficient for it to make an
informed decision regarding an investment in the Company and an opportunity
to ask questions and receive answers concerning the Common Shares, the Junior
Preferred Shares, the Senior Preferred Shares and Exchange Options; (b) the
Company has made available, a reasonable time prior to the date of this
Agreement, the opportunity to obtain any additional information that the
Company possesses or can acquire without unreasonable effort or expense
deemed necessary by Investor or GEI to verify the accuracy of the information
provided, and has received all such additional information requested; and (c)
except for information contained in documents filed by Hollywood with the
Securities and Exchange Commission prior to the date hereof and information
provided by the Company to Investor and GEI contained, or described, in
EXHIBIT A through EXHIBIT E, inclusive, to this Agreement, it has not relied
on the Company, Hollywood or any of their respective affiliates, officers,
employees or representatives in connection with its investigation or the
accuracy of the information provided or in making any investment decision.
It further acknowledges and agrees that the capital structure of the Company,
and the terms of the Junior Preferred Shares and Senior Preferred Shares,
immediately following the Merger shall be substantially as described in
EXHIBIT A through EXHIBIT E, inclusive, to this Agreement.
13
4.6 MANAGEMENT SERVICES AGREEMENT. Investor acknowledges and agrees
that Xxxxxxx Xxxxx & Partners, L.P. ("LGP") and the Equity Participants, or
their affiliates, shall be entitled to receive annual management fees and other
fees from the Company and its subsidiaries pursuant to management services
agreements substantially in the form previously provided to Investor.
5. IRREVOCABLE SUBSCRIPTION AND CANCELLATION.
(a) Each of Investor, GEI and the Company understands that this
subscription is irrevocable, except as expressly provided herein or otherwise
provided in any applicable federal or state law governing this Agreement and
the transactions contemplated herein.
(b) Notwithstanding any provision of this Agreement to the
contrary, Investor shall, no later than the 12 month anniversary of the Merger,
Transfer (as defined below), or arrange for the Transfer of, 10% of the Common
Shares to be acquired by Investor pursuant to this Agreement (constituting 5% of
the Common Shares outstanding on a fully-diluted basis as of immediately prior
to the effective time of the Merger after giving effect to the Contribution and
the GEI Contribution) to certain members of senior management of Hollywood (each
a "Management Participant") or such greater number of Common Shares as Investor
determines in his sole discretion, and in connection with any such transfer,
Investor may Transfer Junior Preferred Shares acquired by Investor pursuant to
this Agreement; PROVIDED, that (i) the terms of such Transfer and the identity
of such Management Participants shall be reasonably acceptable to GEI and the
Company; (ii) prior to, and as a condition of, receipt of such Common Shares
each such Management Participant shall have executed and delivered the
Stockholders Agreement to GEI and the Company; and (iii) such Transfer occurs in
a private placement exempt from the registration requirements of the Securities
Act and shall not, alone or together with any other such Transfer, require the
Company to register (or result in the Company being required to register) any
securities pursuant to the Securities Act. For purposes of this Agreement,
"Transfer" shall mean (a) a sale of Common Shares by Investor to the Company
followed immediately thereafter by a sale of the same number of shares by the
Company to a Management Participant at the same price per share paid by the
Company to the Investor (such price to be determined by Investor and the
Management Participant, so long as such price does not have an adverse tax or
accounting impact on the Company), (b) a sale of Common Shares by Investor
directly to a Management Participant pursuant to a Separate Agreement (as
defined in the Stockholders Agreement), (c) an arrangement between a Management
Participant and the Company pursuant to which such Management Participant
contributes cash to the Company in exchange for Common Shares on terms and
conditions substantially similar to the terms and conditions of this Agreement
(with such changes as may be appropriate in the event any such Management
Participant is not an "accredited investor"), (d) an arrangement between a
Management Participant and the Company pursuant to which such Management
Participant contributes Hollywood Common Shares to the Company in exchange for
Common Shares, or (e) such other transactions as the Company and Investor
mutually agree, after good faith discussion, achieve the purposes of this
Section 5(b) and minimize any adverse tax and accounting implications for the
Company and Investor, in the case of each of clauses (a), (b), (c), (d) and (e)
above, including a similar arrangement with respect to any Junior Preferred
Shares (if any) to be transferred. To the extent such Transfers are effected
pursuant to a transaction described in clause (c) or (d) of the immediately
preceding sentence prior to consummation of the Merger,
14
SCHEDULE 1 to this Agreement shall be deemed modified as follows: (i) the number
of Rollover Shares shall be reduced by an amount equal to the sum of (x) the
aggregate amount of cash contributed to the Company by the Management
Participants divided by the merger consideration to be paid per Hollywood Common
Share pursuant to the Merger Agreement and (y) the number of Hollywood Common
Shares contributed to the Company by the Management Participants in transactions
described in clause (d) above, (ii) the number of Common Shares constituting
Contribution Shares shall be reduced by an amount equal to the sum of (x) one
share for each $0.3125 contributed to the Company by the Management Participants
and (y) the number of Common Shares issued to the Management Participants in
transactions described in clause (d) above, and (iii) the number of Junior
Preferred Shares constituting Contribution Shares shall be reduced by an amount
equal to the sum of (x) one Junior Preferred Share for each $1,000 contributed
to the Company by the Management Participants in transactions described in
clause (c) above in exchange for Junior Preferred Shares and (y) (A) the total
number of Common Shares contributed to the Company by the Management
Participants in transactions described in clause (d) above in exchange of Junior
Preferred Shares, multiplied by the merger consideration to be paid per
Hollywood Common Share pursuant to the Merger Agreement and divided by $1,000.
The Company shall not take any action that would cause any Transfer not to
constitute a private placement exempt from the registration requirements of the
Securities Act.
6. CERTIFICATE OF INCORPORATION AND BY-LAWS. Between the date
hereof and the Closing, the Company, Investor and GEI shall cooperate with one
another to identify any changes to be made to the Certificate of Incorporation
or By-laws of the Company that are necessary or desirable to effectuate the
terms of this Agreement and the Stockholders Agreement and, to the extent the
parties mutually agree to make any such changes, GEI shall adopt such changes in
its capacity as sole stockholder of the Corporation prior to the Closing.
7. [Intentionally Omitted]
8. ATTORNEYS' FEES. In the event of any litigation or other legal
proceeding involving the interpretation of this Agreement or enforcement of
the rights or obligations of the parties hereto, the prevailing party or
parties shall be entitled to recover reasonable attorneys' fees and costs as
determined by a court or other adjudicator.
9. GOVERNING LAW. This Agreement is governed by and shall be
construed in accordance with the law of the State of Delaware applicable to
contracts made and to be performed entirely in such state. If any provision
of this Agreement or the application thereof to any person or circumstance is
held invalid or unenforceable to any extent, the remainder of this Agreement
and the application of that provision to other persons or circumstances shall
not be affected thereby, and that provision shall be enforced to the greatest
extent permitted by law. Each party agrees and consents to the exclusive
jurisdiction of the Chancery Court of the State of Delaware, County of New
Castle or, if such court does not have jurisdiction over the subject matter
of such proceeding or if such jurisdiction is not available, the United
States District Court for the District of Delaware, for the purposes of any
action, suit or proceeding arising out of or relating to this Agreement, and
hereby waives, and agrees not to assert, as a defense in any action, suit or
proceeding relating hereto, that it is not subject to such jurisdiction or
that such action, suit or proceeding may not be brought or is not
maintainable in such courts. Each party irrevocably consents to personal
jurisdiction, service and venue in any such court.
15
10. ASSIGNMENT. Subject to Section 5(b), Investor shall have neither
the right nor the power to assign or delegate any provision of this Agreement
except with the prior written consent of the Company (which may be withheld
in the Company's sole discretion); provided, that Investor may assign its
rights and obligations under this Agreement to (i) any corporation or other
entity at least fifty-one percent (51%) of the equity securities of which are
owned, beneficially and of record by Investor and over which Investor has the
sole right to elect or appoint at least a majority of the members of the
board of directors or persons performing similar functions or (iii) any
trust, partnership, limited liability company or other entity established for
the benefit of Investor and/or members of Investor's immediate family,
provided that Investor and/or his current spouse are the only trustees of (or
are the only individuals having similar controlling positions with respect
to) such trust or other entity. Subject to the right of GEI to assign its
rights hereunder to Management Participants as contemplated by Section 1.1(c)
hereof, GEI shall have neither the right nor the power to assign or delegate
any right or obligation pursuant to this Agreement; PROVIDED, HOWEVER, GEI
may assign its rights and obligations pursuant to this Agreement to any
affiliate of LGP. Except as provided in the preceding sentence, this
Agreement shall be binding upon and shall inure to the benefit of the
parties' respective successors, assigns, executors and administrators.
11. COUNTERPARTS. This Agreement may be executed in separate
counterparts, each of which shall be deemed an original and all of which
shall constitute one and the same document. This Agreement may be executed
by facsimile signature by any party hereto and such signature shall be deemed
binding for all purposes hereof, without delivery of an original signature
being thereafter required.
12. EFFECTIVENESS; ENTIRE AGREEMENT. This Agreement shall become
effective immediately upon execution and delivery hereof by each of the
Company, Investor and GEI, at which time the Original Agreement shall,
pursuant to Section 13 of the Original Agreement, terminate automatically
without any further action on the part of any party thereto. This Agreement,
together with the Option Agreement and the Stockholders Agreement constitutes
the entire agreement among the parties hereto with respect to the subject
matter hereof and may be amended only in a writing executed by the party to
be bound thereby.
13. TERMINATION OF AGREEMENT. This Agreement may be terminated:
(i) by the mutual written consent of the parties hereto or (ii) by any party if
the Merger Agreement is terminated for any reason whatsoever.
14. FURTHER ASSURANCES. Subject to the terms and conditions provided
herein, each party hereto agrees to use all commercially reasonable efforts
to take, or cause to be taken, all action, and to do, or cause to be done,
all things necessary, proper or advisable, whether under applicable laws and
regulations or otherwise, in order to consummate and make effective the
transactions contemplated by this Agreement.
16
15. HSR ACT. Subject to the terms and conditions hereof, each party
shall take all reasonable action necessary to file as soon as practicable
notifications under the HSR Act and to respond as promptly as practicable to
any inquiries from the Federal Trade Commission ("FTC") and the Antitrust
Division of the Department of Justice ("DOJ") for additional information or
documentation and to respond as promptly as practicable to all inquiries and
requests received from any state attorney general or other Governmental
Entity in connection with antitrust matters related to the Merger and/or the
acquisition by Investor of Common Shares or Junior Preferred Shares pursuant
to this Agreement or upon exercise of the Exchange Options. Investor and the
Company shall have the right to review in advance, and to the extent
reasonably practicable each will consult the other on, all the information
relating to the other, that appears in any filing made with, or written
materials submitted to, any Governmental Entity in connection with the Merger
and the transactions contemplated by this Agreement. Notwithstanding any
provision of this Section 15, nothing in this Agreement shall be deemed to
require the Company to waive any condition contained in the Merger Agreement,
including Section 9.3(b) thereof. In the event that the Merger is not
consummated for any reason other than a breach of this Agreement or the
Voting Agreement by Investor, the Company shall reimburse Investor for any
filing fees paid by Investor to the FTC or DOJ in connection with filings
made by Investor pursuant to the HSR Act.
16. OTHER EXPENSES. The Company shall pay to, or on behalf of,
Investor, promptly when billed following consummation of the merger, all
reasonable, documented, out-of-pocket expenses incurred by Investor in
connection with the Contribution and Exchange under this Agreement.
17. EQUITY PARTICIPANTS. In the event that GEI assigns its rights to
acquire GEI Common Shares, GEI Junior Preferred Shares or GEI Senior
Preferred Shares to one or more Equity Participants as contemplated by
Section 1.1(c) of this Agreement, Investor, GEI and the Company shall
negotiate in good faith to make such changes to (a) the Stockholders
Agreement to reflect the ownership of Common Shares, Junior Preferred Shares
or Senior Preferred Shares by such Equity Participants; PROVIDED, that no
such changes shall adversely affect Investor's rights thereunder or impose
additional obligations on Investor (other than as are reasonably necessary to
allow the Equity Participants to participate in such rights and obligations
of GEI under the Stockholders Agreement) and (b) the form of management
services agreement previously provided to Investor; PROVIDED, in the case of
this clause (b) that no such changes shall increase the aggregate Structuring
Fees or Annual Fees payable by the Company or the relationship of such Annual
Fees to the Monitoring Fee payable to Investor pursuant to the Employment
Agreement. For the avoidance of doubt, the parties agree that such changes
to the Stockholders Agreement, to the extent that they relate to rights of
the Equity Participants vis-a-vis the Investor and/or GEI (and/or among the
Equity Participants) may include changes similar to the terms and provisions
contained in the draft Stockholders Agreement provided to Investor on the
morning of March 25, 2004. Each transfer to an Equity Participant will occur
in a private placement exempt from the registration requirements of the
Securities Act and shall not, alone or together with any other transfer(s),
the Contribution and/or the Exchange, require the Company to register (or
result in the Company being required to register) any securities pursuant to
the Securities Act.
17
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18
IN WITNESS WHEREOF, the parties have hereby executed this Option
Exchange, Contribution and Subscription Agreement as of the date set forth
above.
CARSO HOLDINGS CORPORATION
a Delaware corporation
By: /s/ XXXX X. XXXXXX
---------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
GREEN EQUITY INVESTORS IV, L.P.
By: GEI Capital IV, LLC, its general
partner
By: /s/ XXXX X. XXXXXXX
---------------------------------
Name: Xxxx X. Xxxxxxx
Title: Member
INDIVIDUAL INVESTOR
Xxxx X. Xxxxxxx
-----------------------------------
Name (Print or Type)
/s/ XXXX X. XXXXXXX
-----------------------------------
Signature
-----------------------------------
Signature of Spouse
-----------------------------------
(Street Address)
-----------------------------------
(City and State) (Zip Code)
-----------------------------------
Telephone Number
-----------------------------------
Social Security Number or
Taxpayer Identification Number
S-1
SCHEDULE 1
--------------------------------------------------------------------------------
Rollover Shares Aggregate Value(1) Contribution Shares
--------------------------------------------------------------------------------
975,610 $10,000,002.50(2) 32,000,000 Common Shares
Hollywood Common
Shares
--------------------------------------------------------------------------------
2,161,990 $22,160,397.50(3) 22,160 Junior Preferred Shares
Hollywood Common
Shares
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Original
Exercise Price Exchange Option
Rollover Options Per Share(4) Exchange Options Exercise Price
Per Share
--------------------------------------------------------------------------------
3,000,000 $1.09 30,533.333 $100
--------------------------------------------------------------------------------
----------------
(1) Value based on Merger Consideration per Hollywood Common Share.
(2) $2.50 to be returned to Investor as contemplated by Section 1.5(a)(iv).
(3) $397.50 to be returned to Investor as contemplated by Section 1.5(a)(iv).
(4) The value of a Rollover Option equals difference between Merger
Consideration per Hollywood Common Share and exercise price per
Hollywood Common Share subject to the Rollover Option.
SCHEDULE 1
EXHIBIT INDEX
Investor Questionnaire
Exhibit A - Form of Stockholders Agreement
Exhibit B - Form of Option Agreement
Exhibit C - Table of Sources and Uses of Funds
Exhibit D - Term Sheets for Senior Preferred Stock and Junior Preferred Stock
Exhibit E - Financing Commitments
EXHIBIT INDEX
