TERMINATION AGREEMENT
This TERMINATION AGREEMENT (this "Termination Agreement") is dated as
of February 7,1997, by and among Spice Entertainment
Companies, Inc. (f/k/a Xxxxx Pay-Per-View, Inc.), a Delaware corporation
(the "Company"), and the Xxxxxxx Family Revocable Trust, Xxxx X. Xxxxxxx,
Xxxx X. Xxxxxxx and Xxxxx X. Xxxxxxx (collectively, the "Xxxxxxx Parties").
RECITALS:
WHEREAS, the Xxxxxxx Parties own all of the outstanding shares of
United Transactive Systems, Inc.(f/k/a Xxxxxxx Information Systems, Inc.),
a California corporation ("SIS");
WHEREAS, in conjunction with the merger of Xxxxxxx Entertainment Group,
Inc. ("SEG") with and into a wholly owned subsidiary of the Company, the Company
and the Xxxxxxx Parties entered into a letter agreement dated August 14, 1995,
as amended August 30, 1995 (the "Letter Agreement"), pursuant to which (i) the
Xxxxxxx Parties granted to the Company an option (the "Option") to acquire all
of the capital stock of SIS in exchange for shares of the common stock, par
value $.01 per share, of the Company ("Company Common Stock"), and (ii) the
Company granted the Xxxxxxx Parties the right to require the Company to acquire
such shares of SIS in exchange for shares of Company Common Stock (the "Put"),
all upon the terms and conditions set forth therein; and
WHEREAS, the Company and the Xxxxxxx Parties have entered into a
settlement agreement, dated as of , 1997 (the "Settlement Agreement"),
pursuant to which, among other things, the Xxxxxxx Parties have agreed
to suspend their prior exercise of the Put and the parties have agreed to
terminate conditionally the Letter Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein, the parties agree as follows:
1. (a) Each of the Xxxxxxx Parties hereby represents and warrants to
the Company that it has not assigned, transferred or otherwise disposed of any
of its rights under the Letter Agreement, such rights are not subject to any
Lien or Restriction (each as defined in the Settlement Agreement)(other than
under federal or state securities laws), and that it has full power and
authority to execute and deliver this Termination Agreement.
(b) The Company hereby represents and warrants to each of the
Xxxxxxx Parties that it has not assigned, transferred, or otherwise disposed of
any of its rights under the Letter Agreement, such rights are not subject to any
Lien or Restriction (other than under federal or state securities law), and that
it has full power and authority to execute and deliver this Termination
Agreement.
2. Each of the Xxxxxxx Parties hereby (a) suspends its prior exercise
of the Put, (b) agrees that prior to the reinstatement of the Put pursuant to
Section 3(b) of this Termination Agreement, it will not make any other or
further attempts to exercise the Put, and (c) acknowledges and agrees that the
Company shall have no obligation to honor such Put or any liability related
thereto, including any liability relating to the Company's failure to honor the
Put during the period from the date of the original exercise thereof, unless and
until such rights and obligations are reinstated pursuant to Section 3(b) of
this Termination Agreement.
3. (a) Subject to Section 1.03 of the Settlement Agreement ("Section
1.03"), effective upon the Closing (as defined in the Settlement Agreement),
the Letter Agreement is hereby terminated and all rights and obligations of the
parties thereunder are hereby extinguished.
(b) Notwithstanding anything in the foregoing paragraph 3(a)
or Section 1.03 to the contrary, if at any time prior to the third anniversary
of the Closing, a court of competent jurisdiction issues a final order (which is
not subject to appeal by any party or with respect to which the time to appeal
shall have expired) in any action, suit or proceeding brought by a third party
declaring that any of the material transactions contemplated by and to be
consummated pursuant to the Settlement Agreement and each of the "Additional
Agreements" (as defined in the Settlement Agreement) are null, void or are
otherwise avoided, rescinded or set aside, then the exercise of the Put deemed
suspended pursuant to the Settlement Agreement and this Termination Agreement
shall be deemed reinstated retroactive to the original date of such exercise.
4. This Termination Agreement and the legal relations between the
parties hereto shall be governed by and construed in accordance with the laws of
the State of Delaware, without regard to the conflict of laws rules thereof.
5. This Termination Agreement may be executed in counterparts, each of
which shall be deemed an original, and all of which together shall be considered
one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Termination
Agreement to be executed as of the date first referred to above.
SPICE ENTERTAINMENT COMPANIES, INC.
By: /s/ J. Xxxxx Xxxxxxx
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J. Xxxxx Xxxxxxx
Chairman and Chief Executive Officer
THE XXXXXXX FAMILY REVOCABLE TRUST
By: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
Co-Trustee
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
Co-Trustee
By: /s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx
By: /s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx
By: /s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
