EXHIBIT 10(b)
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT, dated November 9, 1998, by and among
WESTERN UNION LEASING LTD., an Irish corporation, having an address at 00
Xxxxxxxx Xxxxx, 0 Xxxxxxx Xxxxx, Xxxxxx XX0 Xxxxxxx ("Western"), FAB CAPITAL
CORP., an Iowa corporation, having an address at 0000 Xxxxx Xxxxxx, Xxxxx 000,
Xxx Xxxx, XX 00000 ("FAB"), MBO MUSIC VERLAG GmbH, a German company organized
under the laws of the Federal Republic of Germany, having an address at Xxxxxxx
Xxxxxx 00, Xxxxxxxxxx-Xxxxxxx, Xxxxxxx 00000 ("MBO"), KINGS ROAD ENTERTAINMENT,
INC., a Delaware corporation, having an address at 1901 Avenue of the Stars, Xxx
Xxxxxxx, XX 00000 ("Buyer"), and IMMEDIATE ENTERTAINMENT GROUP, INC., a Nevada
corporation, having an address at Xxxx- Xxxxxx-Xxx. 00-00/XX D-63322 Rodermak,
Germany (the "Company").
WHEREAS, Buyer wishes to purchase from each of Western, FAB
and MBO (each, a "Seller," and collectively, "Sellers"), and each Seller wishes
to sell to Buyer, the number of shares of common stock of the Company, par value
$.001 per share ("Common Stock"), set forth opposite such Seller's name on
Exhibit A, attached hereto and made a part hereof, (collectively, the "Shares");
NOW, THEREFORE, the in consideration of the premises and the
mutual covenants and agreements contained herein, the parties hereto do hereby
agree as follows:
1. Purchase of Shares.
a. Subject to the terms and conditions set forth herein, and
in reliance upon the representations, warranties and agreements of the Company
and each Seller contained herein, Buyer agrees to purchase from each Seller, and
each Seller, in reliance upon the representations, warranties and agreements of
Buyer and the Company contained herein, agrees to sell to Buyer, at a closing
(the "Closing") to take place on the date hereof (the "Closing Date"), the
number of Shares owned by such Seller (such "Seller's Shares") for the Purchase
Price, as defined below.
b. Purchase Price. Simultaneously with the execution and
delivery hereof, as consideration for the Shares, Buyer shall pay to Sellers, an
aggregate of Two Million Five Hundred Ten Thousand Eight Hundred and Two and
67/100 Dollars ($2,510,802.67), to be paid to each Seller as set forth the under
the heading "Seller's Cash Price" on Exhibit A hereto, and an aggregate of
1,477,567 shares of common stock of Buyer, par value $.01 per share
(collectively, "Buyer's Shares"), to be issued to each Seller as set forth under
the heading "No. of Buyer's Shares" on Exhibit A hereto. For this purpose, the
Buyer and the Sellers have valued the Buyer's Shares at an aggregate of Three
Million Four Hundred Seventy-Two Thousand Two Hundred Eighty-Four and 90/100
Dollars ($3,472,284.90). At the Closing, the cash portion of the Purchase Price
shall be paid by Buyer to each Seller in the amount set forth under the heading
"Seller's Cash Price" opposite each Seller's name (such "Seller's Cash Price")
on Exhibit A hereto. At the Closing, each Seller shall transfer to Buyer the
number of Seller's Shares set forth opposite such Seller's name under the
heading "No. of Seller's Shares" on Exhibit A hereto.
c. Deliveries at Closing. At Closing or as soon as practicable
thereafter, Buyer shall pay to each Seller such Seller's Cash Price by delivery
to such Seller, at such Seller's option, either a certified or bank check or by
wire transfer to an account designated by such Seller in the amount of such
Seller's Cash Price. At Closing or as soon as practicable thereafter, Buyer
shall issue such number of Buyer's shares to each Seller as set forth under the
heading "No. of Seller's Shares" set forth opposite each Seller's name on
Exhibit A hereto by delivering to each Seller the stock certificate(s)
representing number of Buyer's Shares to be issued to such Seller hereunder. At
Closing, each Seller shall deliver to Buyer the stock certificate(s)
representing such Seller's Shares, with stock power(s) duly endorsed in blank,
for transfer with all necessary stock transfer stamps affixed.
2. Board Approvals. At or prior to the Closing, the Board of Directors
of the Company shall approve the sale of the Shares by Sellers to Buyer pursuant
to the terms of this Agreement, and at or promptly after the Closing, the
Company shall deliver to Buyer resolutions of the Company's Board of Directors
evidencing such authorization, which resolutions shall be certified to be true
and correct by the Secretary of the Company. At or prior to the Closing, the
Board of Directors of Buyer shall approve the issuance of Buyer's Shares to
Sellers pursuant to the terms of this Agreement, and at or promptly after the
Closing, Buyer shall deliver to the Company resolutions of Buyer's Board of
Directors evidencing such authorization, which resolutions shall be certified to
be true and correct by the Secretary of Buyer.
3. Representations and Warranties
a. Representations and Warranties of Each Seller. Each Seller
hereby represents and warrants to Buyer that:
(i) Title to Shares. Immediately prior to the
transfer of such Sellers Shares pursuant hereto, such Seller
will have good and valid title to such Seller's Shares, free
and clear of all liens, claims and encumbrances of any nature,
and upon delivery of certificates representing such Seller's
Shares and payment therefor pursuant to the terms of this
Agreement, good and valid title to such Sellers' Shares will
be transferred to Buyer free and clear of all liens, claims
and encumbrances.
(ii) Due Authorization. Each Seller has full right,
power and authority to sell such Seller's Shares on the terms
set forth herein, to execute and deliver this Agreement and to
enter into the transactions contemplated hereby and to perform
all of its obligations hereunder. This Agreement has been duly
authorized, executed and delivered by such Seller and
constitutes the legal, valid, and binding obligation of such
Seller, enforceable against such Seller in accordance with the
-2-
termshereof (subject only to applicable bankruptcy,
insolvency, and other laws affecting the enforceability of
creditors' rights generally and to general equitable
principles). No consent, authorization, approval, order,
license, certificate or permit of or from, or registration,
qualification, declaration or filing with, any federal,
state, local, foreign, or other governmental authority or
any court or other tribunal is required to be obtained by
such Seller for its execution and delivery hereof or the
performance by such Seller of such Seller's obligations
under this Agreement. No consent of any party to any
contract, agreement, instrument, lease, license, arrangement
and no or understanding to which such Seller is a party or
to which any of such Seller's properties or assets is or may
be subject, is required for the execution, delivery or
performance by such Seller of this Agreement or the
consummation of the transactions contemplated hereby which
has not been or will not be obtained prior to the Closing,
and the execution, delivery and performance of this
Agreement and the consummation of the transactions
contemplated hereby by such Seller will not violate, result
in breach of, conflict with, or (with or without the giving
of notice or the passage of time or both) entitle any party
to terminate or call a default under any such contract,
agreement, instrument, lease, license, arrangement, or
understanding to which such Seller is a party or by which it
may be bound (except for any such violation, breach or
conflict which has been duly waived thereunder) or violate,
result in a breach of, or conflict with any law, rule,
regulation, order, judgment or decree binding on such Seller
or to which Seller or any of such Sellers' properties or
assets is or may be subject.
(iii) Restricted Securities; Investment Intent. Each
Seller hereby acknowledges that Buyer's Shares are "restricted
securities" under the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder (the
"Securities Act"), and is purchasing the such Buyer's Shares
for investment purposes only and not with a view to the
distribution thereof.
(iv) Such Seller has access to copies of Buyer's
public filings with the SEC, has had an opportunity to review
the same, has been afforded an opportunity to speak with
executive officers of Buyer and to review its files, and such
Seller has otherwise conducted and is relying solely upon its
own due diligence with respect to Buyer's Shares and Buyer.
b. Representations and Warranties of Buyer. Buyer represents
and warrants to each Seller and the Company, as follows:
(i) Title to Shares. Upon delivery of stock
certificate(s) representing Buyer's Shares pursuant to the
terms of this Agreement, such Buyer's Shares will be duly
authorized, validly issued, fully paid and non-assessable.
(ii) Due Authorization. Buyer has full right, power
and authority to issue Buyer's Shares on the terms set forth
herein, to execute and deliver this Agreement, to enter into
the transactions contemplated hereby and to perform all of its
obligations
-3-
hereunder. This Agreement has been duly authorized, executed
and delivered by Buyer and constitutes the legal, valid, and
binding obligation of Buyer enforceable against Buyer in
accordance with the terms hereof (subject only to applicable
bankruptcy, insolvency, and other laws affecting the
enforceability of creditors' rights generally and to general
equitable principles). No consent, authorization, approval,
order, license, certificate or permit of or from, or
registration, qualification, declaration or filing with, any
federal, state, local, foreign, or other governmental
authority or any court or other tribunal is required to be
obtained by Buyer for its execution and delivery of this
Agreement or the performance by Buyer of its obligations
hereunder. No consent of any party to any contract, agreement,
instrument, lease, license, arrangement and no or
understanding to which Buyer is a party or to which its
properties or assets is or may be subject is required for the
execution, delivery or performance by Buyer of this Agreement
or the consummation of the transactions contemplated hereby
which has not been or will not be obtained prior to the
Closing, and the execution, delivery and performance of this
Agreement and the consummation of the transactions
contemplated hereby by Buyer, will not violate, result in
breach of, conflict with, or (with or without the giving of
notice or the passage of time or both) entitle any party to
terminate or call a default under any such contract,
agreement, instrument, lease, license, arrangement, or
understanding to which such Seller is a party or by which it
may be bound (except for any such violation, breach or
conflict which has been duly waived thereunder) or violate,
result in a breach of, or conflict with any law, rule,
regulation, order, judgment or decree binding on Buyer or to
which its or any of its properties or assets is or may be
subject.
(iii) Buyer is relying on its own due diligence with
respect to the Company and Buyer's purchase of the Sellers'
Shares.
c. Representations and Warranties of the Company. The Company
represents and warrants to Buyer, as follows:
(i) Due Authorization. The Company has full right,
power and authority to execute and deliver this Agreement, to
perform all of its obligations hereunder and to consummate the
transactions contemplated hereby. All necessary corporate
proceedings of the Company have been duly taken to authorize
the execution, delivery and performance by the Company of its
obligations hereunder and its consummation of the transactions
contemplated hereby. This Agreement has been duly authorized,
executed and delivered by the Company and constitutes the
legal, valid and binding obligation of the Company,
enforceable as to the Company in accordance with its terms
(subject only to applicable bankruptcy, insolvency, and other
laws affecting the enforceability of creditors' rights
generally and to general equitable principles). No consent,
authorization, approval, order, license, certificate or permit
of or from, or registration, qualification, declaration or
filing with, any federal, state, local, foreign, or other
governmental authority or any court or other tribunal is
required to be obtained or delivered by the Company for the
-4-
execution or delivery of this Agreement, or performance by
the Company of its obligations hereunder or consummation by
the Company of the transactions contemplated hereby. No
consent of any party to any contract, agreement, instrument,
lease, license, arrangement, or understanding to which the
Company is a party or to which the Company or any of its
properties or assets is or may be subject, is required for
the execution and delivery of this Agreement or the
consummation by the Company of the transactions contemplated
hereby which has not been or will not be obtained prior to
the Closing, and the execution, delivery and performance of
this Agreement and the consummation of the transactions
contemplated hereby by the Company will not violate, result
in breach of, conflict with, or (with or without the giving
of notice or the passage of time or both) entitle any party
to terminate or call a default under any such contract,
agreement, instrument, lease, license, arrangement, or
understanding (except for any such violation, breach or
conflict which has been properly waived thereunder) or
violate or result in breach of any term of the certificate
of incorporation or by-laws of the Company, or violate,
result in a breach of, or conflict with any law, rule,
regulation, order, judgment, or decree binding on the
Company or to which any of its operations, businesses,
properties, or assets is or may be subject.
(ii) As soon as practicable, after the purchase of
the Sellers' Shares by the Buyer, the Company will record said
transaction on its books and records.
4. Conditions to Closing.
a. Conditions to Obligations of Buyer. The obligations of
Buyer to purchase the Shares and pay the Purchase Price to Sellers on the date
hereof are subject to the fulfillment, prior to or on the Closing Date, of each
of the following conditions:
(i) Representations, Warranties and Covenants. The
representations and warranties of each Seller and the Company
contained in this Agreement shall be true and correct in all
material respects on the Closing Date, and each of the Company
and each Seller shall have performed or complied in all
material respects with all agreements and covenants required
by this Agreement to be performed or complied with by the
Company and each Seller, respectively, on or prior to the
Closing Date.
(ii) No Proceeding or Litigation. No action, suit or
proceeding shall have been commenced in a court of competent
jurisdiction or by or before any governmental authority
against any of the Company, any other Seller or Buyer seeking
to restrain or materially and adversely alter the transactions
contemplated by this Agreement which, in the reasonable, good
faith determination of Buyer, is likely to prevent Buyer from
consummating, or make it unlawful for Buyer to consummate,
such transactions.
b. Conditions to Obligations of Each Seller. The obligation of
each Seller to sell such Seller's Shares to Buyer on the Closing Date is subject
to the fulfillment, prior to or on the Closing Date, of each of the following
conditions:
-5-
(i) Representations, Warranties and Covenants. The
representations and warranties of Buyer contained in this
Agreement shall be true and correct in all material respects
at the Closing Date hereof and Buyer and the Company shall
each have performed or complied in all material respects with
all agreements and covenants required by this Agreement to be
performed or complied with by it on or prior to the Closing
Date.
(ii) No Proceeding or Litigation. No action, suit or
proceeding shall have been commenced in a court of competent
jurisdiction or by or before any governmental authority
against the Company, any other Seller or Buyer seeking to
restrain or materially and adversely alter the transactions
contemplated by this Agreement which, in the reasonably, good
faith determination of such Seller is likely to prevent such
Seller from consummating or make it unlawful for such Seller
to consummate such transactions.
c. Conditions to Obligations of the Company. The obligations
of the Company to record or cause to be recorded the transfer of the Shares on
its books and records and perform its other obligations hereunder on the Closing
Date are subject to the fulfillment, prior to or on the Closing Date, of each of
the following conditions:
(i) Representations, Warranties and Covenants. The
representations and warranties of Buyer and the Seller each
contained in this Agreement shall be true and correct in all
material respects on the Closing Date and Buyer and each
Seller shall each have performed or complied in all material
respects with all agreements and covenants required to be
performed by this Agreement or complied with by it on or prior
to the Closing Date.
(ii) No Proceeding or Litigation. No action, suit or
proceeding shall have been commenced in a court of competent
jurisdiction or by or before any governmental authority
against the Company, any Seller or Buyer seeking to restrain
or materially and adversely alter the transactions
contemplated by this Agreement which, in the reasonably, good
faith determination of the Company is likely to prevent the
Company from consummating or make it unlawful for the Company
to consummate such transactions.
5. Survival; Indemnification
a. Survival. The representations and warranties of the parties
contained in this Agreement or in any certificate or other writing delivered
pursuant hereto or in connection herewith shall survive until the third
anniversary of the Closing Date. Notwithstanding the preceding sentence, any
representation or warranty in respect of which indemnity may be sought under
this Agreement shall survive the time at which it would otherwise terminate
pursuant to the preceding sentence, if notice of the inaccuracy thereof giving
rise to such right to indemnity shall have been given to the party against whom
such indemnity may be sought prior to such time.
b. Indemnification of Buyer. Each Seller, at its sole expense,
hereby agrees to indemnify Buyer and its affiliates against and agrees to hold
-6-
each of them harmless from any and all damage, loss, liability and expense
(including, without limitation, reasonable expenses of investigation and
reasonable attorneys' fees and expenses in connection with any action, suit or
proceeding) (collectively, "Loss") incurred or suffered by Buyer or any of its
affiliates arising out of any misrepresentation or breach of any warranty,
covenant or agreement made or to be performed by such Seller pursuant to this
Agreement.
The Company, at its sole expense, hereby agrees to indemnify
Buyer and its affiliates against and agrees to hold each of them harmless from
any and all Loss incurred or suffered by Buyer or any of its affiliates arising
out of any misrepresentation or breach of warranty, covenant or agreement made
or to be performed by the Company pursuant to this Agreement.
c. Indemnification of Sellers. Buyer, at its sole expense,
hereby agrees to indemnify each Seller and such Seller's affiliates against and
agrees to hold each of them harmless from any and all Loss incurred or suffered
by any of them, respectively, arising out of any misrepresentation or breach of
warranty, covenant or agreement made or to be performed by Buyer pursuant to
this Agreement.
The Company, at its sole expense, hereby agrees to indemnify
each Seller and such Seller's affiliates against and agrees to hold each of them
harmless from any and all Loss incurred or suffered by any of them,
respectively, arising out of any misrepresentation or breach of warranty,
covenant or agreement made or to be performed by Company pursuant to this
Agreement.
d. Indemnification of the Company. Buyer, at its sole expense,
hereby agrees to indemnify the Company and its affiliates and agrees to hold
each of them harmless from any and all Loss incurred or suffered by them arising
out of any misrepresentation or breach of warranty, covenant or agreement made
or to be performed by Buyer pursuant to this Agreement.
Each Seller, at its sole expense, hereby agrees to indemnify
the Company and its affiliates and agrees to hold each of them harmless from any
and all Loss incurred or suffered by them arising out of any misrepresentation
or breach of warranty, covenant or agreement made or to be performed by such
Seller pursuant to this Agreement.
e. Procedures; Exclusivity of Remedies. The party seeking
indemnification hereunder (the "Indemnified Party") agrees to give prompt notice
to the party against whom indemnity is sought (the "Indemnifying Party") of the
assertion of any claim or the commencement of any suit, action or proceeding in
respect of which indemnity may be sought under this Section 5. The Indemnifying
Party shall have the right to, and at the request of the Indemnified Party
shall, participate in and control the defense of any such suit, action or
proceeding at its own expense; provided, however, that the failure by the
Indemnified Party to give prompt notice shall not release the Indemnifying Party
of its indemnification obligations hereunder, except to the extent such failure
actually prejudices the Indemnifying Party. If the Indemnifying Party does not
so assume control of the defense, the Indemnified Party shall have the right to
defend, contest, settle or compromise such claim or defend in the exercise of
its exclusive discretion and the Indemnifying Party shall, upon request from any
Indemnified Party, promptly pay to such Indemnified Party the amount of any Loss
as incurred. If the Indemnifying Party does assume control of the defense, the
Indemnifying Party
-7-
shall have the right to undertake, conduct and control, through counsel of its
own choosing and at its sole expense, the conduct and settlement of such claim
or demand, and the Indemnified Party shall cooperate with the Indemnifying Party
in connection therewith.
6. Miscellaneous
a. Notices. Any notice or other communication required or
permitted hereunder shall be in writing and shall be deemed given to a party on
the date delivered personally to such party, on the third day following the
sending thereof by registered or certified mail (postage prepaid, return receipt
requested), on the next business day following the sending thereof by overnight
courier, or on the day on which it is sent by telecopy with confirmation of
delivery and addressed to such party at the address set forth in the prologue of
this Agreement.
b. Amendment. This Agreement may not be amended or modified
except by an instrument in writing signed by the parties hereto that are
affected by such amendment or modification.
c. Governing Law. This Agreement has been prepared, negotiated
and delivered in the State of New York, and shall be governed by, and construed
in accordance with, the laws of the State of New York without giving effect to
the principles thereof relating to the conflict of laws.
d. Submission to Jurisdiction. Each party hereby (i) consents
to the jurisdiction of the United States District Court for the Southern
District of New York and any of the courts of the State of New York located in
New York County in connection with any dispute arising under this Agreement and
(ii) waives objection to venue.
e. Entire Agreement. This Agreement sets forth the entire
agreement and understanding of the parties hereto in respect of the subject
matter hereof, and supersedes all prior agreements, promises, covenants,
arrangements, communications, representations or warranties, whether oral or
written, by the parties hereto or their representatives.
-8-
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
SELLERS: WESTERN UNION LEASING LTD.
By: /s/
-------------------------------
Name: Xxxxxxx Xxxx
Title:
FAB CAPITAL CORP.
By: /s/
-------------------------------
Name: Xxxxxxx Xxxx
Title:
MBO MUSIC VERLAG GmbH
By: /s/
-------------------------------
Name: Xxxxxxx Xxxxxxxxxx
Title: Managing Director
BUYER: KINGS ROAD ENTERTAINMENT, INC.
By: /s/
-------------------------------
Name: Xxxxx Xxxxxxxx
Title:
THE COMPANY: IMMEDIATE ENTERTAINMENT GROUP, INC.
By: /s/
-------------------------------
Name: Xxxxxxx Xxxxxxxxxx
Title: Chairman
-9-
EXHIBIT A
SELLERS AND SELLERS' SHARES
Percentage of Seller's Cash No. of Seller's No. of Buyer's
Name of Seller Seller's Shares Price Shares Shares
----------------------------------------------------------------------------------------------------
Western 16.7% $419,650.00 400,000 246,957
FAB 44.2% $1,109,853.60 1,057,885 653,131
MBO 39.1% $981,299.07 935,350 577,479
----------------------------------------------------------------------------------------------------
TOTALS: 100% $2,510,802.67 2,393,235 1,477,567
====================================================================================================
-10-
