November 17, 1998
Crown American Enterprises, Inc.
Xxxxxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxxx
Re: Genesis Media Group, Inc./Vision Digital Communications, Inc.
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Dear Xx. Xxxxxxxx:
This letter agreement is made with reference to that certain Asset
Purchase Agreement (the "Agreement") dated as of October 26, 1998 among
Vision Digital Communications, Inc., a California corporation ("Vision
Digital"), certain shareholders of Visions Digital and Genesis
Xxxxxxxxxx.xxx, Inc., a Delaware corporation (formerly Genesis Media Group,
Inc.) ("Genesis"). This letter agreement confirms our mutual agreements with
Vision Digital, Xxxxxxxxxxx Xxxxxxx ("Xxxxxxx"), Xxxxxxx X. Xxxxx ("Costa")
and Crown American Enterprises, Inc., a Pennsylvania corporation ("Crown
American"), to amend the Agreement as follows:
1. SECTIONS 2.2(a) and 3.2(a)(i) of the Agreement, presently provides
that Genesis will issue an aggregate number of sixty thousand (60,000)
restricted shares of its Common Stock (the "Shares") to Vision Digital at the
Closing. It is hereby agreed that twenty-eight and one-half percent (28.5%)
of the Shares shall be distributed directly to Crown American and seventy-one
and one-half percent (71.5%) of the Shares shall be distributed to Vision
Digital.
2. SECTION 9.5 of the Agreement provides that all of the Shares will be
pledged to secure the indemnification obligations of Vision Digital and its
Affiliates (as defined in this Agreement) (including Xxxxxxx and Costa) under
the Agreement. It is hereby agreed that Crown American shall not be liable
for any such indemnification obligations and that the 28.5% of the Shares
that are to be distributed directly to Crown American shall not be pledged as
security for the indemnification obligations of Vision Digital, Xxxxxxx or
Costa pursuant to SECTION 9.5 of the Agreement. It is also hereby agreed
that, Genesis shall have no recourse against Crown American with respect to
such obligations.
3. Pursuant to SECTIONS 2.2(b) and 2.5 of the Agreement, Genesis has
agreed to issue up to an aggregate of 50,000 Options (as defined in the
Agreement) to Vision Digital upon satisfaction
Page 2
of certain conditions. It is hereby agreed that at the Closing Genesis will
issue directly to Crown American Options to purchase 14,250 shares of Common
Stock of Genesis, equal to 28.5% of the total number of Options issuable to
Vision Digital under the Agreement. Such Options shall vest ratably with the
Options issued to Vision Digital upon the occurrence of the events specified
in SECTION 2.5 of the Agreement. The remaining Options to purchase 35,750
shares of Common Stock (71.5% of the total Options) shall be issued to Vision
Digital at the Closing, subject to the ratable vesting upon the conditions
provided in SECTION 2.5 of the Agreement. The exercise price of the Options
issuable to Crown American shall be the price at which the Common Stock is
initially offered to the public pursuant to Form SB-2; the exercise price of
the Options issuable to Vision Digital shall be $10.00 per share.
4. SECTION 2.2(c) of the Agreement provides for the assumption by
Genesis of the Assumed Liabilities (as defined in the Agreement) set forth on
SCHEDULE 1.1(b) of the Agreement. It is hereby confirmed and agreed that the
Assumed Liabilities include: (a) the existing loan to Vision Digital extended
by U.S. Bank and guaranteed by Crown American, among others, and (b) the
existing loan extended to Vision Digital by Crown American, in the aggregate
amount of Eighty Thousand Dollars ($80,000). No further amendment of either
such loan shall be effected hereby.
Please confirm your agreement to the foregoing agreements and amendments
of the Agreement by signing a copy of this letter in the space indicated
below and returning the same to our office. Please contact me at (805)
000-0000 if you have any questions regarding this matter.
Very truly yours,
XXXXXXXXXXXXXXXXX.XXX, INC.
By: /s/ Ramy El-Batrawi
-----------------------------
Ramy El-Batrawi
Chairman
AGREED:
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CROWN AMERICAN ENTERPRISES, INC.,
a Pennsylvania corporation
By: /s/ Xxxx X. Xxxxx
---------------------------
Name:Xxxx X. Xxxxx
Title: Vice President
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THE FOREGOING AMENDMENTS TO THE
AGREEMENT ARE CONSENTED TO AND
AGREED BY THE UNDERSIGNED:
VISION DIGITAL COMMUNICATIONS, INC.,
a California corporation
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxx
Title:President
/s/ Xxxxxxxxxxx Xxxxxxx
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XXXXXXXXXXX XXXXXXX
/s/ Xxxxxxx X. Xxxxx
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XXXXXXX X. XXXXX
