INDEMNIFICATION AGREEMENT
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THIS INDEMNIFICATION AGREEMENT (this "Agreement"), dated as of this
27th day of February, 1997, is made by and between On Stage Entertainment, Inc.,
a Nevada corporation and all of its subsidiaries (collectively, the "Company")
and Xxxx X. Xxxxxx, as an individual ("Stuart") and as a majority shareholder of
Grand Strand Entertainment, Inc., a South Carolina corporation ("Grand Strand").
RECITALS
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WHEREAS, in December of 0000, Xxxxx Xxxxxx began negotiating with the
Company to obtain the non-exclusive license to present a "Legends in Concert"
production in Myrtle Beach, South Carolina; and
WHEREAS, on or about March 29, 1995, the Company entered into a
non-exclusive licensing agreement with Grand Strand to present a "Legends in
Concert" production in Myrtle Beach, South Carolina, which was contingent upon
certain conditions precedent (the "Licensing Agreement"); and
WHEREAS, subsequent to the issuance of the Licensing Agreement, Grand
Strand failed to fulfill the conditions precedent which the Licensing Agreement
was contingent upon; and
WHEREAS, on or about April 22, 1995 the Company revoked the Licensing
Agreement for Grand Strand's failure to meet the required conditions precedent;
and
WHEREAS, Xxx X. Xxxxxxx, a shareholder of Grand Strand, has recently
threatened to file a shareholder derivative suit to enforce the rights of Grand
Strand alleging that the Company wrongfully revoked the Licensing Agreement and
thereby usurped the opportunity to operate the Legends in Concert production in
Myrtle Beach, South Carolina as its own; and
WHEREAS, in connection with a proposed bridge financing private
placement and subsequent public offering, Whale Securities Co., L.P. has
required that Stuart indemnify the Company for certain liabilities related to
the foregoing.
NOW, THEREFORE, in consideration of the foregoing recitals, the parties
hereto agree as follows:
AGREEMENT
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Stuart shall indemnify the Company in the event the Company is a party
to or threatened to be made a party to or otherwise involved in any proceeding
(including a proceeding by or in the name of the Company to procure a judgment
in its favor) by any reason relating to the grant and subsequent revocation of
the Licensing Agreement or by reason of any act or inaction by Stuart and/or the
Company in relation to the Myrtle Beach production, against (i) any liability
for any judgments or settlement payment incurred by the Company, and (ii) if a
judgment is entered against the Company, Grand Strand or Stuart, then (a) any
and all expenses and liabilities of any type whatsoever in addition to judgments
and amounts paid in settlement), and (b) legal fees and court costs reasonably
incurred by the Company in connection with the investigation, defense,
settlement or appeal of such proceeding.
IN WITNESS WHEREOF, the undersigned have executed this Indemnification
Agreement as of the date first set forth above.
On Stage Entertainment, Inc.
/s/ Xxxx X. Xxxxxx By: /s/ Xxxxx Xxxxx
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Xxxx X. Xxxxxx, an individual SVP&CFO
