(Indem, DOC) EXHIBIT 2.4
INDEMNIFICATION AGREEMENT
INDEMNIFICATION AGREEMENT dated as of March 31, 1997 by (i) AMC
Entertainment Inc., a Delaware corporation ("AMCE"), (ii) Xxxxxxx X. Xxxxxxx,
individually, and as trustee of the 1992 Xxxxxxx, Inc. Voting Trust dated
December 12, 1992 (the "1992 TRUST") and as trustee of the Trust created
pursuant to the Xxxxxxx X. Xxxxxxx Trust Agreement dated August 14, 1989 (the
"1989 TRUST"), Xxxxx X. Xxxxxxxxx, Xxxxxx X. Xxxxxxx, Xxxxxx X. Xxxxxxx, Xxxxxx
X. Xxxxxx, Xxxxx X. Xxxxxxx and Xxxxx X. Xxxxxxx (all persons and entities
listed in this clause (ii) are referred to herein as the "XXXXXXX PARTIES") and
(iii) Delta Properties, Inc., a Missouri corporation ("DELTA"). Capitalized
terms used herein and not defined herein are used as defined in the Merger
Agreement (as defined below).
WHEREAS, contemporaneously with the execution and delivery hereof AMCE
and Xxxxxxx, Inc., a Missouri corporation ("DI"), are entering into an Agreement
and Plan of Merger and Reorganization dated as of the date hereof (the "MERGER
AGREEMENT") pursuant to which, subject to the conditions and the terms contained
therein, DI would merge with and into AMCE, with AMCE being the surviving
corporation; and
WHEREAS, the Xxxxxxx Parties are direct and indirect stockholders of
DI and desire that the Merger be consummated; and
WHEREAS, prior to or following the execution and delivery hereof, DI
has transferred or will transfer to Delta certain of its assets and the Xxxxxxx
Parties and DI would not be willing to enter into this Agreement unless Delta
undertakes certain obligations set forth herein and in consideration for such
transfer to it; and
WHEREAS, the Registration Statement and Proxy Statement will contain
information regarding AMCE, DI and certain Xxxxxxx Parties and entities and
persons affiliated with the Xxxxxxx Parties; and
WHEREAS, the Merger Agreement will contain representations,
warranties, covenants and agreements of AMCE and DI; and
WHEREAS, AMCE would not be willing to enter into the Merger Agreement
and consummate the Merger, and the Xxxxxxx Parties would not be willing to cause
DI to enter into the Merger Agreement and consummate the Merger, unless the
parties hereto agree to indemnify each other on the terms and conditions set
forth herein;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements and covenants set forth herein, the parties hereto do hereby agree
and covenant as follows:
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1. INDEMNITIES REGARDING REGISTRATION STATEMENT AND PROXY STATEMENT.
(a) Each Xxxxxxx Party severally agrees to provide AMCE with such
information as to such Xxxxxxx Party as is necessary for AMCE to complete the
Registration Statement and the Offering Materials (as defined below) in
accordance with the requirements of the Securities Act. Each Xxxxxxx Party
severally covenants that the information supplied or to be supplied by such
Xxxxxxx Party (and, in the case of Xxxxxxx X. Xxxxxxx, the 1992 Trust and the
1989 Trust) in writing for inclusion in, and which is included in, the
Registration Statement or any amendment or supplement thereto, or the Offering
Materials which concerns such Xxxxxxx Party (the "XXXXXXX PARTY INFORMATION"),
will not, at the respective times such documents are filed with the SEC and at
the Effective Time, and, in the case of the Registration Statement or any
amendment or supplement thereto, when the same becomes effective, and, in the
case of the Offering Materials, at the time of mailing thereof to AMCE's
stockholders, contain any untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading. Any Xxxxxxx Party
Information regarding a Xxxxxxx Party included in any such document will be
deemed to have been so supplied in writing by such Xxxxxxx Party specifically
for inclusion therein if such document was available for review by such Xxxxxxx
Party (or the legal counsel of such Xxxxxxx Party) a reasonable time before such
document was filed and not objected to in writing by such Xxxxxxx Party prior to
the filing thereof. If at any time prior to the Effective Time a Xxxxxxx Party
obtains actual knowledge (without duty of investigation) of any event or
circumstance relating to the Xxxxxxx Entities (as defined below) which should be
set forth in an amendment or supplement to the Registration Statement or
Offering Materials, as required by applicable law, such Xxxxxxx Party shall
promptly inform AMCE. AMCE and its affiliates, officers, directors, employees,
agents, successors and assigns shall be indemnified and held harmless by each
Xxxxxxx Party severally and in the case of Xxxxxxx Party Information concerning
Xxxxxxx X. Xxxxxxx, the 1992 Trust or the 1989 Trust, by the SHD Indemnitors (as
defined below), jointly and severally, for any and all Losses (as defined
herein) actually suffered or incurred by them arising out of or resulting from
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement or the Offering Materials, or any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, if the statement or omission was made in
reliance upon and in conformity with the Xxxxxxx Party Information supplied by
such Xxxxxxx Party (or in the case of indemnification by the SHD Indemnitors, by
any SHD Indemnitor).
(b) Xxxxxxx X. Xxxxxxx, the 1992 Trust and the 1989 Trust (the "SHD
INDEMNITORS") agree (jointly and severally) to provide AMCE with such
information as to DI, Subsidiaries of DI (other than AMCE) and American
Associated Enterprises, a Missouri limited partnership ("AAE") (DI, Subsidiaries
of DI (other than AMCE) and AAE are referred to as the "DI PERSONS" and the
Xxxxxxx Parties and the DI Persons are referred to as the "XXXXXXX ENTITIES") as
is necessary for AMCE to complete the Registration Statement and the Offering
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Materials in accordance with the requirements of the Securities Act. The SHD
Indemnitors covenant that the information supplied or to be supplied in writing
for inclusion in, and which is included in, the Registration Statement or any
amendment or supplement thereto, or the Offering Materials, which concerns the
DI Persons (the "DI PERSON INFORMATION"), will not, at the respective times such
documents are filed with the SEC and at the Effective Time, and, in the case of
the Registration Statement or any amendment or supplement thereto, when the same
becomes effective, and, in the case of the Offering Materials, at the time of
mailing thereof to AMCE's stockholders, contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. Any DI Person Information included in any such document will be
deemed to have been so supplied in writing specifically for inclusion therein if
such document was available for review by Xxxxxxx X. Xxxxxxx (or his legal
counsel) a reasonable time before such document was filed and not objected to in
writing by Xxxxxxx X. Xxxxxxx prior to the filing thereof. AMCE and its
affiliates, officers, directors, employees, agents, successors and assigns shall
be indemnified and held harmless by the SHD Indemnitors (jointly and severally)
for any and all Losses actually suffered or incurred by them arising out of or
resulting from any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement or the Offering Materials, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, if the statement or
omission was made in reliance upon and in conformity with the DI Person
Information.
(c) Each Xxxxxxx Party (other than the SHD Indemnitors) shall be
indemnified and held harmless by AMCE for any and all Losses actually suffered
or incurred by them arising out of or resulting from any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or the Offering Materials, or any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading, in each case except to the extent that the statement or
omission was made in reliance upon and in conformity with the Xxxxxxx Party
Information or the DI Person Information.
(d) As used herein, "OFFERING MATERIALS" means the Proxy Statement
and prospectus relating to the Merger included in the Registration Statement,
and each of the other documents mailed to stockholders of AMCE in connection
with the Merger.
(e) If for any reason, other than in accordance with the terms of
this Section 1, the indemnification provided for in this Section 1 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a), (b) or (c) above in respect of any Losses referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such Losses in such proportion as is
appropriate to reflect its relative fault in connection with the statements or
omissions which resulted in such Losses, as well as any other relevant equitable
considerations, but not in excess of amounts, if any, such indemnifying party
would have been required to pay if such indemnification had been available. The
relative fault shall be determined by reference to, among other things, whether
the untrue or
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alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by such indemnifying
Party and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Xxxxxxx
Parties agree that it would not be just and equitable if contribution pursuant
to this subsection (e) were determined by pro rata allocation or by any other
method of allocation which does not take account of the equitable consideration
referred to above in this subsection (e). No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
(f) The obligations of AMCE under this Section 1 shall be in addition
to any liability which AMCE may otherwise have, and the obligations of the
Xxxxxxx Parties under this Section 1 shall be in addition to any liability which
the Xxxxxxx Parties may otherwise have.
(g) The obligations of AMCE and the Xxxxxxx Parties under this
Section 1 shall terminate on the Termination Date (as defined below), except
that such obligations shall survive in respect to any claim for indemnification
made under this Section 1 prior to the Termination Date until such claim for
indemnification is finally resolved. As used herein "TERMINATION DATE" means
the March 31 that is two years after the March 31 occurring immediately after
the date on which the Effective Time occurs.
2. INDEMNIFICATION FOR BREACHES OF MERGER AGREEMENT AND LIABILITIES.
(a) If the Effective Time occurs, AMCE shall indemnify and hold
harmless the Xxxxxxx Parties (other than the SHD Indemnitors) and their
Permitted Assignees (as defined in the form of Registration Agreement attached
as Exhibit C to the Merger Agreement) against and in respect of any and all
liabilities, losses, damages, claims, costs and expenses (including, without
limitation, reasonable attorneys' fees and expenses) determined on a net
after-tax basis ("LOSSES") which may be incurred by such Xxxxxxx Parties or
Permitted Assignees based upon, resulting from or arising out of the breach of
any representation, warranty, covenant or agreement of AMCE contained in the
Merger Agreement (for this purpose, and notwithstanding Section 6.5 of the
Merger Agreement, as if all representations, warranties, covenants and
agreements had survived the consummation of the Merger).
(b) If the Effective Time occurs, the SHD Indemnitors shall (jointly
and severally) indemnify and hold harmless AMCE against and in respect of any
and all Losses which may be incurred by AMCE (i) based upon, resulting from or
arising out of the breach of any representation, warranty, covenant or agreement
of DI contained in the Merger Agreement (for this purpose, and notwithstanding
Section 6.5 of the Merger Agreement, as if all representations, warranties,
covenants and agreements had survived the consummation of the Merger) or (ii)
based upon, resulting from, arising out of or constituting any liability or
obligation of DI or its Subsidiaries, known or unknown, fixed, contingent or
otherwise.
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(c) If the Effective Time occurs, the SHD Indemnitors and Delta shall
(jointly and severally) pay and indemnify and hold harmless AMCE from and
against all of DI's Expenses and one-half of AMCE's Expenses.
(d) If the Effective Time occurs, the SHD Indemnitors shall (jointly
and severally) indemnify and hold harmless AMCE from and against, (i) any Taxes
attributable to DI or any of its Subsidiaries for taxable periods ending on or
prior to the Effective Time, including without limitation any Taxes attributable
to the transactions contemplated by the Pre-Merger Action Plan, and (ii) all
Losses incurred by AMCE in connection therewith. For purposes of this
Agreement, "Taxes" shall mean all taxes, including, without limitation, all net
income, gross income, gross receipts, sales, use, value-added, ad valorem,
transfer, franchise, profits, license, withholding, payroll, employment, excise,
estimated, severance, stamp, occupation, property or other taxes and customs
duties of any kind whatsoever, together with any interest, penalties and
additions to tax or additional amounts relating thereto, imposed by any
governmental authority (domestic or foreign).
(e) If the Effective Time does not occur, the SHD Indemnitors and
Delta shall (jointly and severally) indemnify and hold harmless AMCE against and
in respect of Losses which may be incurred by AMCE as a result of the breach by
DI of any representation, warranty, covenant or agreement in the Merger
Agreement (without regard to Section 6.4 thereof).
(f) If the Effective Time occurs, each Xxxxxxx Party shall (severally
and not jointly) indemnify and hold harmless AMCE against and in respect of
Losses which may be incurred by AMCE as a result of the breach by such Xxxxxxx
Party of a representation, warranty, covenant or agreement contained in Article
VI of the Stock Agreement.
(g) Each SHD Indemnitor agrees that he or it will not transfer Voting
Securities (as defined in the Stock Agreement) to any person or entity (other
than in the Secondary Offering (as defined in the form of Stock Agreement
attached as Exhibit B to the Merger Agreement), to a Charitable Assignee (as
defined below) or otherwise in arms-length sales for fair consideration) unless
the transferee agrees by instrument in form and substance satisfactory to AMCE
to be bound by the provisions of this Agreement as an SHD Indemnitor and to
guarantee the performance by Xxxxxxx X. Xxxxxxx, the 1992 Trust and the 1989
Trust of their obligations under this Agreement and under Section 5 of the
Registration Agreement and Section 5.3 of the Stock Agreement (an
"INSTRUMENT"); PROVIDED, HOWEVER, that an SHD Indemnitor may not transfer more
than 5% of the shares of AMCE Class B Stock or AMCE Common Stock received by it
in the Merger (or AMCE Common Stock received upon conversion of such AMCE Class
B Stock) to Charitable Assignees unless the Charitable Assignees receiving
shares in excess of such threshold enter into an Instrument. As used herein, a
"CHARITABLE ASSIGNEE" of a Stockholder shall mean any charitable organization,
including charitable remainder and charitable lead trusts, a transfer of
property to which by such Stockholder would qualify, at least in part, for an
income, gift or estate tax charitable deduction under the Tax Code.
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(i) The obligations of AMCE, Delta and the Xxxxxxx Parties under this
Section 2 shall terminate on the Termination Date, except that such obligations
shall survive in respect to any claim for indemnification made under this
Section 2 prior to the Termination Date until such claim for indemnification is
finally resolved.
(j) AMCE agrees that it will not seek to hold Delta's stockholders
liable (in their capacities as such) for Delta's obligations under or arising
from this Agreement, the Merger Agreement, the Stock Agreement or the
Registration Agreement or the transactions contemplated hereby or thereby.
3. PROCEDURE FOR INDEMNIFICATION.
(a) The party seeking indemnification pursuant to Sections 1 or 2 is
referred to as the "INDEMNIFIED PARTY" and the party from whom indemnification
is sought under Sections 1 or 2 is referred to as the "INDEMNIFYING PARTY."
(b) The Indemnified Party shall give prompt written notice to the
Indemnifying Party of any claim for indemnification under Sections 1 or 2 above
relating to a claim or demand of a third party with respect to which it is
seeking indemnification hereunder. The failure to give such prompt notice shall
not relieve the Indemnifying Party of its indemnity obligations hereunder with
respect thereto, except to the extent that the Indemnifying Party is materially
prejudiced by such failure. The Indemnifying Party shall have the right to
defend and to direct the defense against any such claim or demand (other than
one made pursuant to Section 2(d)), in its name or in the name of the
Indemnified Party, as the case may be, at the expense of the Indemnifying Party,
and with the counsel selected by the Indemnifying Party and approved by the
Indemnified Party (such approval not to be unreasonably withheld), PROVIDED that
the Indemnifying Party may not settle or compromise any such claim or demand
without the consent of the Indemnified Party (which consent may not be
unreasonably withheld) if injunctive or other equitable relief would be imposed
against the Indemnified Party as a result thereof. Notwithstanding anything in
this Agreement to the contrary, the Indemnified Party shall cooperate with the
Indemnifying Party, and keep the Indemnifying Party fully informed in the
defense of such claim or demand. The Indemnified Party shall have the right to
participate in the defense of any claim or demand with counsel employed by it at
the expense of the Indemnified Party. The Indemnifying Party shall have no
indemnification obligations with respect to any such claim or demand which shall
be settled by the Indemnified Party without the prior written consent of the
Indemnifying Party.
4. OTHER AGREEMENTS
(a) NO AMENDMENT. The Xxxxxxx Parties covenant that the Xxxxxxx
Family Settlement Agreement dated as of January 22, 1996 by and among
Xxxxxxx X. Xxxxxxx, in the capacities specified therein, Xxxxx X.
Xxxxxxxxx, Xxxxxx X. Xxxxxxx, Xxxxxx X. Xxxxxxx, Xxxxxx X. Xxxxxx,
Xxxxx X. Xxxxxxx and Xxxxx X. Xxxxxxx (the "XXXXXXX FAMILY AGREEMENT")
will not be amended without the
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prior written consent of AMCE, which consent will not be unreasonably
withheld. Each Xxxxxxx Party hereby represents and warrants to AMCE
that attached hereto as EXHIBIT A is a true, correct and complete copy
of the Xxxxxxx Family Agreement as in effect on the date hereof.
(b) EXECUTION OF OTHER AGREEMENTS. Each Xxxxxxx Party agrees to
execute and deliver (and to cause Delta to execute and deliver) the
Stock Agreement and the Registration Agreement at the Closing.
(c) ESCROW AGREEMENT. Each Xxxxxxx Party agrees that at the
Closing it will execute and deliver an Escrow Agreement substantially
in the form of Exhibit B hereto pursuant to which such Xxxxxxx Party
shall deposit in escrow 50% of the shares of AMCE Common Stock and
AMCE Class B Stock received in the Merger by such Xxxxxxx Party (plus,
in the case of Xxxxxxx X. Xxxxxxx, the 1989 Trust and the 1992 Trust,
collectively, a number of shares of AMCE Class B Stock equal to the
sum of (x) 65% of the number of shares of AMCE Common Stock received
by Harvard in the Merger, plus (y) a number of shares of AMCE Class B
Stock equal to the Specified Percentage (as defined in the form of
Stock Agreement attached as Exhibit B to the Merger Agreement) of the
total number of shares of AMCE Class B Stock and AMCE Common Stock
issued in the Merger). Such shares shall be held in Escrow for a
period of two years from the date of the Closing. Such Xxxxxxx Party
shall retain the right to vote (subject to the Stock Agreement) and be
entitled to receive all cash dividends or other distributions paid in
respect of shares deposited in Escrow, but all dividends paid in
capital stock of AMCE or other securities shall be held in Escrow
until the end of such two-year period.
(d) NO TRANSFERS. Each Xxxxxxx Party agrees that except as set
forth in the Pre-Merger Action Plan, prior to the Merger it will not
directly or indirectly transfer any interest he, she or it has in DI,
AAE or AMCE, including without limitation any right to receive shares
of AMCE Common Stock or AMCE Class B Stock in the Merger.
(e) APPLICATION OF CREDIT AMOUNTS. Credit Amounts (as defined
below) outstanding from time to time shall be applied to satisfy (to
the extent of the Credit Amounts then outstanding) the obligations of
the SHD Indemnitors pursuant to Sections 2(c) and 2(e) of this
Agreement, Section 4 of the Registration Agreement and Section 5.3 of
the Stock Agreement (the "SPECIFIED SECTIONS"). As promptly as
practicable following the Termination Date, AMCE shall pay to the SHD
Indemnitors an amount equal to the Credit Amount then outstanding (and
not applied to satisfy liabilities under the Specified Sections),
provided that in the event AMCE has made claims pursuant to the
Specified Sections prior to such date that have not been resolved,
AMCE may withhold from such payment the amount of such claims until
such claims are finally resolved (whereupon it
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shall as promptly as practicable pay to the SHD Indemnitors any
portion of such Credit Amounts not applied to such claims). In the
event that a Credit Amount arises after the Termination Date, AMCE
shall promptly pay to the SHD Indemnitors the amount of such Credit
Amount. All payments to SHD Indemnitors pursuant to this paragraph
(e) shall be made pro rata based on the total number of shares of AMCE
Class B Stock received by each SHD Indemnitor in the Merger. As used
herein, "CREDIT AMOUNTS" shall mean the amounts of any net tax
benefit, as and when finally determined, actually realized by AMCE
from time to time following the Merger solely as a result of (and
which would not have been realized but for) (i) the utilization by
AMCE for federal income tax purposes of DI's alternative minimum tax
credit carryforwards and (ii) the utilization by AMCE for Missouri
income tax purposes of DI's Missouri net operating loss carryforwards.
(f) DI TAX RETURNS. Without limiting the obligations of the SHD
Indemnitors pursuant to Section 2(d) above, AMCE will cause to be
prepared and filed (at the expense of the SHD Indemnitors) all income
tax returns of DI not heretofore filed, and the Xxxxxxx Parties and
Delta shall make available to AMCE all books and records of DI
necessary in the preparation of such returns. The SHD Indemnitors
shall pay all Taxes due and payable under such returns.
5. REPRESENTATIONS AND WARRANTIES.
(a) REPRESENTATIONS AND WARRANTIES OF STOCKHOLDERS: Each Xxxxxxx
Party and Delta, severally, as to himself, herself or itself, and not jointly,
hereby represents and warrants to AMCE as follows:
(i) Such Xxxxxxx Party (or Delta, as the case may be) has full legal
right, power and authority to enter into and perform this Agreement. This
Agreement is a valid and binding obligation of such Xxxxxxx Party (or Delta, as
the case may be) enforceable against such Xxxxxxx Party (or Delta, as the case
may be) in accordance with its terms, except that such enforcement may be
subject to (x) bankruptcy, fraudulent conveyance, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally and (y) general principles of equity (regardless of
whether such enforcement is considered in a proceeding in equity or at law).
(ii) Neither the execution and delivery of this Agreement nor the
consummation by such Xxxxxxx Party (or Delta, as the case may be) of the
transactions contemplated hereby conflicts with or constitutes a violation of or
default under any statute, law, regulation, order or decree applicable to such
Xxxxxxx Party (or Delta, as the case may be), or any material contract,
commitment, agreement, arrangement or restriction of any kind to which such
Xxxxxxx Party (or Delta, as the case may be) is a party or by which such Xxxxxxx
Party (or Delta, as the case may be) is bound.
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(b) REPRESENTATIONS AND WARRANTIES OF AMCE. AMCE hereby represents
and warrants to the Xxxxxxx Parties as follows:
(i) AMCE has full legal right, power and authority to enter into and
perform this Agreement. The execution and delivery of this Agreement and the
consummation by AMCE of the transactions contemplated hereby have been duly
authorized by all necessary corporate action on behalf of AMCE. This Agreement
is a valid and binding obligation of AMCE enforceable against AMCE in accordance
with its terms, except that such enforcement may be subject to (x) bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium or other similar
laws now or hereafter in effect relating to creditors' rights generally and (y)
general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law).
(ii) Neither the execution and delivery of this Agreement by AMCE nor
the consummation by AMCE of the transactions contemplated hereby conflicts with
or constitutes a violation of or default under the charter or bylaws of AMCE,
any statute, law, regulation, order or decree applicable to AMCE, or any
material contract, commitment, agreement, arrangement or restriction of any kind
to which AMCE is a party or by which AMCE is bound.
6. NOTICES. Any notice, request, consent, waiver or other
communication required or permitted hereunder shall be effective only if it is
in writing and personally delivered or sent by certified or registered mail,
postage prepaid, addressed as follows:
To: AMC Entertainment Inc.: Suite 1700 Power & Light Xxxx.
000 Xxxx 00xx Xxxxxx
Post Office Box 419615
Kansas City, MO 64141-6615
Attention: Corporate Secretary
To: any Xxxxxxx Party: to the address set forth next to
such Xxxxxxx Party's name on
the signature page hereof
To: Delta Properties, Inc.: Suite 1700 Power & Light Xxxx.
000 Xxxx 00xx Xxxxxx
P.O. Box 419615
Xxxxxx Xxxx, XX 00000-0000
Attention: Corporate Secretary
or such other address as may be specified in a notice duly given as provided
herein. Such notice or communication shall be deemed to have been given upon
receipt thereof. Information copies of all notices given a Xxxxxxx Party (other
than Xxxxxxx X. Xxxxxxx, the 1992 Trust or the 1989 Trust) or Delta shall be
given to:
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Xxxxxx X. Xxxxxx, Esq.
Kopple & Xxxxxxx
0000 Xxxxxxx Xxxx Xxxx
Xxxxx 0000
Xxx Xxxxxxx, A 90067
Xxxxx Xxxxxxxxx, Esq.
Xxxxxx Xxxxxx & Xxxxx
000 Xxxx 00xx Xxxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Information copies of all notices given to Xxxxxxx X. Xxxxxxx, the
1992 Trust, the 1989 Trust or Delta should be given to:
Xxxxxxx X. Xxxxxx, Xx., Esq.
Xxxxxxx & Xxxx X.X.
0000 Xxxxx Xxxxxxxxx, 00xx Xxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000-0000
Information copies of all notices given to AMCE shall be given to:
Xxxxxxx X. Xxxx, Xx., Esq.
Hallmark Cards, Incorporated
0000 XxXxx Xxxxxxxxxx
Xxxxxx Xxxx, XX 00000-0000
The Xxxxxxxxx Xxxx X. Xxxxxxxx
Polsinelli, White, Xxxxxxxx & Xxxxxxx
Xxxxx 0000, Xxxxx Xxxxxxx
000 Xxxx 00xx Xxxxxx
Xxxxxx Xxxx, XX 00000-0000
7. WAIVER. No delay or failure on the part of any party in
exercising any rights hereunder, and no partial or single exercise thereof, will
constitute a waiver of such rights or of any other rights hereunder.
8. BINDING EFFECT. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors,
assigns, heirs, legatees, devisees, and personal and legal representations.
9. ENTIRE AGREEMENT. This Agreement, the Merger Agreement, the
Registration Agreement and the Stock Agreement and, with respect to the Xxxxxxx
Parties only, the Xxxxxxx Family Agreement constitute the entire agreement among
the parties hereto pertaining to the subject matter hereof. This Agreement
supersedes all prior or contemporaneous, written or
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verbal agreements, understandings and negotiations in connection herewith,
except that the Xxxxxxx Family Agreement shall not be deemed to be amended by
this Agreement and shall remain in full force and effect.
10. AMENDMENTS. This Agreement cannot be modified, amended or
terminated, except as provided by an instrument in writing signed by all the
parties hereto; PROVIDED, HOWEVER, that any provision of this Agreement may be
waived only in writing by the party to be charged with the waiver.
11. SEVERABILITY. If any provision of this Agreement is held to be
invalid or unenforceable by any court of final jurisdiction, it is the intent of
the parties that all other provisions of this Agreement be construed to remain
fully valid, enforceable and binding on the parties.
12. GOVERNING LAW; CONSENT TO JURISDICTION.
(a) This Agreement shall be construed in accordance with, and
governed by, the laws of the State of Missouri without giving the effect to
conflicts of laws principles thereof.
(b) Each party hereto hereby consents to, and confers exclusive
jurisdiction upon, the courts of the State of Missouri and the Federal courts of
the United States of America located in the City of Kansas City, Missouri, and
appropriate appellate courts therefrom, over any action, suit or proceeding
arising out of or relating to this Agreement. Each party covenants that it will
not commence any action, suit or proceeding arising out of or relating to this
Agreement in any other jurisdiction. Nothing in this paragraph shall affect the
rights of a party to enforce a judgment rendered by the courts referred to in
the first sentence of this paragraph in any other jurisdiction. Each party
hereto hereby waives, and agrees not to assert, as a defense in any such action,
suit or proceeding that it is not subject to such jurisdiction or that such
action, suit or proceeding may not be brought or is not maintainable in said
courts or that this Agreement may not be enforced in or by said courts or that
its property is exempt or immune from execution, that the suit, action or
proceeding is brought in an inconvenient forum, or that the venue of the suit,
action or proceeding is improper. Service of process in any such action, suit
or proceeding may be served on any party anywhere in the world, whether within
or without the State of Missouri, by mailing a copy thereof by registered or
certified mail, postage prepaid, to such party at its address provided in
Section 6 of this Agreement, provided that service of process may be
accomplished in any other manner permitted by applicable law.
13. HEADINGS. The headings to the paragraphs to this Agreement are
for convenience only and in no way define, limit or describe the scope or intent
of this Agreement or any party hereto, nor in any other way affect this
Agreement or any part hereof.
14. COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same agreement.
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15. ASSIGNMENT. Neither this Agreement nor any of the rights,
interests, or obligations hereunder may be assigned by any party hereto without
the prior written consent of the other party.
13
IN WITNESS WHEREOF, this Agreement has been signed on behalf of AMC
Entertainment Inc. by Xxxxx X. Xxxxx, its President, by Delta and by each
Xxxxxxx Party, respectively, on the date first above written.
AMC ENTERTAINMENT INC.
By: /s/ Xxxxx X. Xxxxx
----------------------------------------
DELTA PROPERTIES, INC.
By: /s/ Xxxxx X. Xxxxx
----------------------------------------
Suite 1700
Power & Light Building
000 Xxxx 00xx Xxxxxx /s/ Xxxxxxx X. Xxxxxxx
P.O. Box 419615 -------------------------------------------
Xxxxxx Xxxx, Xxxxxxxx 00000-0000 Xxxxxxx X. Xxxxxxx
/s/ Xxxxx X. Xxxxxxxxx
0000 Xxxxxxx Xxxxx Xxxxx -------------------------------------------
Xxxx Xxxxxxx, XX 00000 Xxxxx X. Xxxxxxxxx
/s/ Xxxxxx X. Xxxxxxx
0000 Xxxx 00xx Xxxxxx -------------------------------------------
Xxxxxxx Xxxxxxx, XX 00000 Xxxxxx X. Xxxxxxx
/s/ Xxxxxx X. Xxxxxxx
P.O. Box 7208 -------------------------------------------
Rancho Xxxxx Xx, XX 00000 Xxxxxx X. Xxxxxxx
/s/ Xxxxxx X. Xxxxxx
000 Xxxxxxxx Xxxx Xxxx -------------------------------------------
Xxxxxx, XX 00000 Xxxxxx X. Xxxxxx
/s/ Xxxxx X. Xxxxxxx
655 N.W. Altishan Place -------------------------------------------
Xxxxxxxxx, XX 00000 Xxxxx X. Xxxxxxx
/s/ Xxxxx X. Xxxxxxx
000 Xxxx Xxx Xxxxxx -------------------------------------------
Xxx Xxxx, XX 00000 Xxxxx X. Xxxxxxx
00
Xxxxx 0000
Power & Light Building
000 Xxxx 00xx Xxxxxx /s/ Xxxxxxx X. Xxxxxxx
P.O. Box 419615 -------------------------------------------
Xxxxxx Xxxx, Xxxxxxxx 00000-0000 Xxxxxxx X. Xxxxxxx, as trustee of the 1992
Trust
Suite 1700
Power & Light Building
000 Xxxx 00xx Xxxxxx /s/ Xxxxxxx X. Xxxxxxx
P.O. Box 419615 -------------------------------------------
Xxxxxx Xxxx, Xxxxxxxx 00000-0000 Xxxxxxx X. Xxxxxxx, as trustee of the 1989
Trust
EXHIBIT B TO INDEMNIFICATION AGREEMENT
ESCROW AGREEMENT
This Escrow Agreement is entered into on [date], by and among (i) AMC
Entertainment Inc., a Delaware corporation ("AMCE"), (ii) Xxxxxxx X. Xxxxxxx,
individually, and as trustee of the 1992 Xxxxxxx, Inc. Voting Trust dated
December 12, 1992 (the "1992 TRUST") and as trustee of the Trust created
pursuant to the Xxxxxxx X. Xxxxxxx Trust Agreement dated August 14, 1989 (the
"1989 TRUST"), Xxxxx X. Xxxxxxxxx, Xxxxxx X. Xxxxxxx, Xxxxxx X. Xxxxxxx, Xxxxxx
X. Xxxxxx, Xxxxx X. Xxxxxxx and Xxxxx X. Xxxxxxx (all persons and entities
listed in this clause (ii) are referred to herein as the "XXXXXXX PARTIES") and
(iii)______, a ______ corporation (the "ESCROW AGENT").
WHEREAS, AMCE, the Xxxxxxx Parties and Delta Properties, Inc., a
Missouri corporation, are parties to an Indemnification Agreement dated as of
[insert date] (the "INDEMNIFICATION AGREEMENT"); and
WHEREAS, Section 4(c) of the Indemnification Agreement provides that
certain shares of AMCE Common Stock and AMCE Class B Stock be deposited in
escrow for two years; and
WHEREAS, the Escrow Agent is willing to establish an escrow account
on the terms and subject to the conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereto agree as follows:
1. The Escrow Agent hereby acknowledges receipt of certificates
representing the shares of AMCE Common Stock and Class B Stock listed on
Exhibit A hereto (the "SHARES") from the Xxxxxxx Party whose name is set forth
next to such Shares on Exhibit A, in escrow, pursuant to this Escrow Agreement.
The Xxxxxxx Parties placing Shares in escrow is referred to herein as the
"OWNER" of such Shares and of all Additional Shares (as defined below) issued or
paid as dividends or other distributions thereon. The Escrow Agent agrees to
hold and dispose of the Shares and any Additional Shares in accordance with the
terms and conditions of this Escrow Agreement.
2. The Escrow Agent shall hold the Shares and all shares of capital
stock of AMCE or other securities issued or paid as dividends or other
distributions on the Shares ("ADDITIONAL SHARES") and release them only as set
forth in Section 3 below.
All dividends and other distributions (other than Additional Shares)
on Shares received by the Escrow Agent will be immediately distributed to the
Owner of such Shares. Each Xxxxxxx Party severally agrees to immediately forward
the Escrow Agent for deposit in escrow all Additional Shares received by such
Xxxxxxx Party while the relevant Shares remain in escrow hereunder.
2
The Escrow Agent shall maintain a ledger setting forth the number of
Shares placed in escrow by each Xxxxxxx Party and all Additional Shares issued
in respect of such Shares and deposited in escrow.
3. The Escrow Agent shall distribute the Shares and Additional
Shares as follows:
(a) Subject to paragraphs (b) and (c) below, all Shares and
Additional Shares shall be released from escrow and distributed to the Xxxxxxx
Party that is the Owner thereof promptly following the second anniversary of the
date hereof.
(b) Shares and Additional Shares shall be released from escrow, in
whole or in part, from time to time upon the Escrow Agent's receipt of a joint
written notice of AMCE and the Xxxxxxx Party that is the Owner of such Shares
and Additional Shares in accordance with such notice.
(c) If the Escrow Agent is notified of a claim against or in respect
of Shares or Additional Shares or if a claim is made against the Escrow Agent in
respect of Shares or Additional Shares, such Shares and Additional Shares shall
continue to be held, and not released from escrow, except pursuant to the final
unappealable order (or an order for which the time to appeal has expired without
an appeal having been made ) of a court of competent jurisdiction.
4. It is understood and agreed that the duties of the Escrow Agent
are purely ministerial in nature. It is further agreed that:
(a) the Escrow Agent may conclusively rely and shall be protected in
acting or refraining from acting upon any document, instrument, certificate,
instruction or signature believed by it to be genuine and may assume and shall
be protected in assuming that any person purporting to give any notice or
instructions in accordance with this Escrow Agreement or in connection with any
transaction to which this Escrow Agreement relates has been duly authorized to
do so. The Escrow Agent shall not be obligated to make any inquiry as to the
authority, capacity, existence or identity of any person purporting to have
executed any such document or instrument or have made any such signature or
purporting to give any such notice or instructions;
(b) in the event that the Escrow Agent shall be uncertain as to its
duties or rights hereunder or shall receive instructions with respect to the
Shares and Additional Shares which, in its sole opinion, are in conflict with
either other instructions received by it or any provision of the Escrow
Agreement, it shall, without liability of any kind, be entitled to hold the
Shares and Additional Shares pending the resolution of such uncertainty to the
Escrow Agent's sole satisfaction, by final judgment of a court or courts of
competent jurisdiction or otherwise, or the Escrow Agent, at its option, may, in
final satisfaction of its duties hereunder, deposit the relevant Shares and
Additional Shares with the clerk of any other court of competent jurisdiction;
3
(c) the Escrow Agent undertakes to perform only such duties as are
expressly set forth herein and shall not be bound in any way by any agreement
between AMCE and the Xxxxxxx Parties (whether or not the Escrow Agent has
knowledge thereof);
(d) The Escrow Agent shall not be liable for any action taken by it
in good faith and believed by it to be authorized or within the rights or powers
conferred upon it by this Escrow Agreement (provided that the Escrow Agent shall
be liable for its gross negligence and willful misconduct), and may consult with
counsel of its own choice and shall have full and complete authorization and
protection for any action taken or suffered by it hereunder in good faith and in
accordance with the opinion of such counsel; and
(e) the Escrow Agent shall not assume any responsibility or liability
for any transactions between AMCE and the Xxxxxxx Parties.
5. AMCE agrees to indemnify the Escrow Agent, its directors,
officers, agents and employees and any person who "controls" the Escrow Agent
within the meaning of Section 15 of the Securities Act of 1933, as amended
(collectively the "INDEMNIFIED PARTIES") against, and hold them harmless from,
any and all loss, liability, cost, damage and expense, including, without
limitation, costs of investigation and reasonable counsel fees and expenses,
which any of the Indemnified Parties may suffer or incur by reason of any
action, claim or proceeding brought against any of the Indemnified Parties,
arising out of or relating in any way to this Escrow Agreement or any
transaction to which this Escrow Agreement relates, other than any action, claim
or proceeding to the extent resulting from the gross negligence or willful
misconduct of such Indemnified Party. The provisions of this paragraph shall
survive the termination of this Escrow Agreement.
6. This Escrow Agreement may be altered, amended or terminated only
with the written consent of AMCE, the Xxxxxxx Parties and the Escrow Agent.
Should AMCE and the Xxxxxxx Parties attempt to change this Escrow Agreement in a
manner which, in the Escrow Agent's sole opinion, is undesirable, the Escrow
Agent may resign as Escrow Agent upon two weeks' written notice to AMCE and the
Xxxxxxx Parties; otherwise, notwithstanding any provision hereof to the
contrary, it may resign as Escrow Agent at any time upon 60 days' written notice
to AMCE and the Xxxxxxx Parties. In the case of the Escrow Agent's resignation,
its only duty shall be to hold and dispose of the Shares and Additional Shares
in accordance with the original provisions of this Escrow Agreement until a
successor escrow agent shall be appointed by AMCE and the Xxxxxxx Parties acting
by majority vote (in which each such party shall have one vote) and a written
notice of the name and address of such successor escrow agent shall be given to
the Escrow Agent by AMCE and the Xxxxxxx Parties, whereupon the Escrow Agent's
only duty shall be to turn over, in accordance with the written instructions of
AMCE and the Xxxxxxx Parties, to the successor escrow agent the Shares and
Additional Shares and any documentation related thereto. In the event that a
successor escrow agent shall not have been appointed and the Escrow Agent shall
not have turned over to the successor escrow agent the Shares and Additional
Shares within the time periods specified above, or the Escrow Agent's
4
written notice of resignation, as the case may be, the Escrow Agent may deposit
the Shares and Additional Shares with the clerk of any other court of competent
jurisdiction, at which time the Escrow Agent's duties hereunder shall terminate.
7. The Escrow Agent shall be entitled to a fee of [fees to be
inserted]. The fees will be payable by AMCE.
8. THIS ESCROW AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF THE STATE OF __________ WITHOUT APPLICATION TO THE
PRINCIPLES OF CONFLICTS OF LAWS. This Escrow Agreement shall be binding upon the
parties hereto and their respective successors and assigns; provided, however,
that any assignment or transfer by any party of its rights under this Escrow
Agreement shall be void (as against the Escrow Agent or otherwise) unless:
(a) written notice thereof shall be given to the Escrow Agent, AMCE
and the Xxxxxxx Parties; and
(b) the Escrow Agent, AMCE and the Xxxxxxx Parties shall have
consented, in writing, to such assignment or transfer.
9. All notices, requests, demands and other communications to be
given in connection with this Escrow Agreement shall be in writing, shall be
delivered by hand, overnight delivery service or by facsimile transmission,
shall be deemed given when received and shall be addressed to the Escrow Agent
at the address listed below or to AMCE and the Xxxxxxx Parties at the respective
addresses listed on the signature pages or to such other addresses as they shall
designate from time to time in writing, forwarded in like manner; PROVIDED,
HOWEVER, that if any notice given by telecopy is received other than during the
regular business hours of the recipient, it shall be deemed to have been given
on the opening of business on the next business day of the recipient
If to the Escrow Agent:
[name]
[address]
Attention:
Telecopier No.:
5
Information copies of all notices given a Xxxxxxx party (other than
Xxxxxxx X. Xxxxxxx, the 1992 Trust or the 1989 Trust) shall be given to:
Xxxxxx X. Xxxxxx, Esq.
Kopple & Xxxxxxx
0000 Xxxxxxx Xxxx Xxxx
Xxxxx 0000
Xxx Xxxxxxx, A 90067
Xxxxx Xxxxxxxxx, Esq.
Xxxxxx Xxxxxx & Xxxxx
Xxxxxx Xxxxxx & Xxxxx
000 Xxxx 00xx Xxxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Information copies of all notices given to Xxxxxxx X. Xxxxxxx, the
1992 Trust or the 1989 Trust should be given to:
Xxxxxxx X. Xxxxxx, Xx., Esq.
Xxxxxxx & Xxxx X.X.
0000 Xxxxx Xxxxxxxxx, 00xx Xxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000-0000
Information copies of all notices given to AMCE shall be given to:
Xxxxxxx X. Xxxx, Xx., Esq.
Hallmark Cards, Incorporated
0000 XxXxx Xxxxxxxxxx
Xxxxxx Xxxx, XX 00000-0000
The Xxxxxxxxx Xxxx X. Xxxxxxxx
Polsinelli, White, Xxxxxxxx & Xxxxxxx
Xxxxx 0000, Xxxxx Xxxxxxx
000 Xxxx 00xx Xxxxxx
Xxxxxx Xxxx, XX 00000-0000
10. If any provision of this Escrow Agreement or the application
thereof to any person or circumstance shall be determined to be invalid or
unenforceable, the remaining provisions of this Escrow Agreement or the
application of such provision to persons or circumstances other than those to
which it is held invalid or unenforceable shall not be affected thereby and
shall be valid and enforceable to the fullest extent permitted by law.
6
11. This Escrow Agreement may be executed in several counterparts or
by separate instruments, and all of such counterparts or instruments shall
constitute one agreement, binding on all the parties hereto.
12. All pronouns and any variations thereof shall be deemed to refer
to the masculine, feminine, neuter, singular or plural as the context may
require.
IN WITNESS WHEREOF, the undersigned have executed this Escrow
Agreement as of the day and year first above written.
[Escrow Agent]
By:
--------------------------------
Name:
Title:
Suite 1700
Power & Light Building AMC ENTERTAINMENT INC.
000 Xxxx 00xx Xxxxxx
P.O. Box 419615 By:
Xxxxxx Xxxx, Xxxxxxxx 00000-0000 --------------------------------
Suite 1700
Power & Light Building
000 Xxxx 00xx Xxxxxx
P.O. Box 419615 -----------------------------------
Xxxxxx Xxxx, Xxxxxxxx 00000-0000 Xxxxxxx X. Xxxxxxx
0000 Xxxxxxx Xxxxx Xxxxx -----------------------------------
Xxxx Xxxxxxx, XX 00000 Xxxxx X. Xxxxxxxxx
0000 Xxxx 00xx Xxxxxx -----------------------------------
Xxxxxxx Xxxxxxx, XX 00000 Xxxxxx X. Xxxxxxx
X.X. Xxx 0000 -----------------------------------
Xxxxxx Xxxxx Xx, XX 00000 Xxxxxx X. Xxxxxxx
000 Xxxxxxxx Xxxx Xxxx -----------------------------------
Xxxxxx, XX 00000 Xxxxxx X. Xxxxxx
7
655 N.W. Altishan Place -----------------------------------
Xxxxxxxxx, XX 00000 Xxxxx X. Xxxxxxx
000 Xxxx Xxx Xxxxxx -----------------------------------
Xxx Xxxx, XX 00000 Xxxxx X. Xxxxxxx
Suite 1700
Power & Light Building
000 Xxxx 00xx Xxxxxx
P.O. Box 419615 -----------------------------------
Xxxxxx Xxxx, Xxxxxxxx 00000-0000 Xxxxxxx X. Xxxxxxx, as trustee of
the 1992 Trust
Suite 1700
Power & Light Building
000 Xxxx 00xx Xxxxxx
P.O. Box 419615 -----------------------------------
Xxxxxx Xxxx, Xxxxxxxx 00000-0000 Xxxxxxx X. Xxxxxxx, as trustee of
the 1989 Trust
EXHIBIT A
NAMES SHARES
