-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EuFg4h/JjWXIex8kudBNTyV9QRheRGQGthvTpz2ODkvsKixcLEpnAo8wQkQv9lkl L3+BRkcxPwj6Mm+yLdWPzQ== 0000912057-97-000557.txt : 19970110 0000912057-97-000557.hdr.sgml : 19970110 ACCESSION NUMBER: 0000912057-97-000557 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19961230 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19970109 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: CINERGI PICTURES ENTERTAINMENT INC CENTRAL INDEX KEY: 0000922519 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MOTION PICTURE & VIDEO TAPE PRODUCTION [7812] IRS NUMBER: 954247952 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-23958 FILM NUMBER: 97503359 BUSINESS ADDRESS: STREET 1: 2308 BROADWAY CITY: SANTA MONICA STATE: CA ZIP: 90404 BUSINESS PHONE: 3103156000 MAIL ADDRESS: STREET 1: 2308 BROADWAY CITY: SANTA MONICA STATE: CA ZIP: 90404 8-K 1 FORM 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K Current Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): December 30, 1996 CINERGI PICTURES ENTERTAINMENT INC. (Exact name of registrant as specified in its charter) DELAWARE 0-23958 95-4247952 (State or other (Commission (I.R.S. Employer jurisdiction of Incorporation) File Number) Identification No.) 2308 BROADWAY, SANTA MONICA, CA 90404 (Address of principal executive offices) (zip code) Registrant's telephone number, including area code: (310) 315-6000 N/A (Former name or former address, if changed since last report) ITEM 5. OTHER EVENTS On December 30, 1996 and January 2, 1997, the Company repurchased an aggregate of 744,682 shares of Common Stock of the Company, constituting approximately 5.2% of the 14,191,556 shares of the Company's Common Stock then outstanding and consisting of 372,341 shares held by Dianne Caplan Lebovits, a Director and former executive officer of the Company, and 372,341 shares held by the law firm of Ziffren, Brittenham, Branca & Fischer ("ZBBF"), which acts as special counsel to the Company. Harry M. Brittenham, a partner in ZBBF, is a member of the Company's Board of Directors. Ms. Lebovits and ZBBF had each originally acquired such shares pursuant to separate Stock Purchase Agreements dated as of January 1, 1994 (each an "Original Purchase Agreement") and in exchange for payment of the aggregate par value of such shares in cash and a full recourse secured promissory note in the principal amount of $450,000 (each a "Purchase Note"). Ms. Lebovits subsequently split her Purchase Note into two separate notes (the "Purchase Notes") each secured by different collateral. Pursuant to the terms of the repurchase, in consideration for the sale by ZBBF of the 372,341 shares to the Company, the Company canceled the Purchase Note of ZBBF under which $450,000 was then outstanding. Pursuant to the terms of Ms. Lebovits' Original Purchase Agreement, 51,714 shares of the Common Stock held by Ms. Lebovits which were not vested at the time of her resignation as Executive Vice President, General Counsel and Corporate Secretary of the Company on August 15, 1996, were repurchased at the original purchase price (approximately $1.21 per share) by reducing the aggregate balance due under her Purchase Notes by approximately $62,500. In consideration for the sale by Ms. Lebovits to the Company of the other 320,627 shares repurchased, the Company canceled the remaining balances of her Purchase Notes under which approximately $468,000 was then outstanding (after the $62,500 reduction). As a result of the stock repurchases, as of January 3, 1997, there were an aggregate of 13,446,874 shares of the Company's common stock outstanding. The Company and Warren Braverman, the Company's Chief Operating Officer, Chief Financial Officer and Executive Vice President and a member of the Company's Board of Directors, have agreed to amend Mr. Braverman's employment agreement to extend the term of his employment (due to expire December 31, 1997) for two years, until December 31, 1999. Pursuant to an amendment to his employment agreement dated as of January 1, 1997 (the "Amendment"), Mr. Braverman will receive an annual base salary of $584,000 in 1998 and $613,000 in 1999. Under the existing agreement, Mr. Braverman's annual base salary in 1997 is $556,000. Pursuant to the Amendment, Mr. Braverman also received a signing bonus of $600,000 of which $300,000 was used to fully repay two loans previously made by the Company to Mr. Braverman (a $250,000 loan bearing interest at 7% per annum, which matured December 31, 1996 and under which $250,000 was outstanding as of such date, and a $50,000 interest free loan maturing September 30, 1997). The Amendment also eliminated the requirement that Mr. Braverman mitigate his damages in the event he is entitled under the employment agreement to terminate his employment. The remaining terms of his existing employment agreement (including the incentive compensation provisions) were not altered by the Amendment. -2- ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS (a) Financial Statements of Business Acquired. Not applicable. (b) Pro Forma Financial Information. Not applicable. (c) Exhibits. The Exhibits listed below are filed as part of this Report. Exhibit No. Description of Exhibit ----------- ---------------------- 10.1 Stock Purchase Agreement dated as of January 2, 1997 by and between Ziffren, Brittenham, Branca & Fischer and the Company. 10.2 Stock Purchase Agreement dated as of December 30, 1996 by and between Dianne Caplan Lebovits and the Company. 10.3 Amendment to Restated Employment Agreement of Warren Braverman, dated as of January 1, 1997 by and between Warren Braverman and the Company. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. CINERGI PICTURES ENTERTAINMENT INC. By: /s/ Warren Braverman ---------------------------------------------- Name: Warren Braverman Title: Chief Operating Officer, Chief Financial Officer and Executive Vice President Date: January 7, 1997 -4- EXHIBIT INDEX EXHIBIT NO. DESCRIPTION OF EXHIBIT PAGE 10.1 Stock Purchase Agreement dated as of January 2, 1997 by and between Ziffren, Brittenham, Branca & Fischer and the Company. . . . . . . . . . . . . . . . . . . . . . . . . .6 10.2 Stock Purchase Agreement dated as of December 30, 1996 by and between Dianne Caplan Lebovits and the Company. . . . . . . . . . . . . 13 10.3 Amendment to Restated Employment Agreement of Warren Braverman, dated as of January 1, 1997 by and between Warren Braverman and the Company. . . . . . . . . . . . . . . . 21 -5- EX-10.1 2 EXHIBIT 10.1 STOCK PURCHASE AGREEMENT 1-2-97 STOCK PURCHASE AGREEMENT THIS STOCK PURCHASE AGREEMENT (the "Agreement") is made and entered into as of the 2nd day of January, 1997, by and between Ziffren, Brittenham, Branca & Fischer ("Seller") and Cinergi Pictures Entertainment Inc., a Delaware corporation ("Purchaser"). R E C I T A L S: WHEREAS, pursuant to that certain Stock Sale and Repurchase Agreement dated as of January 1, 1994 by and between Purchaser and Seller, Seller acquired six shares of the Purchaser's common stock; WHEREAS, Seller paid for such shares by paying an amount in cash equal to the aggregate par value of such shares and by issuing to Purchaser a Secured Recourse Promissory Note (the "Note") in the principal amount of $450,000, bearing interest at the rate of 6% per annum and secured in accordance with that certain Security and Stock Pledge Agreement, dated as of January 1, 1994, by and between Purchaser and Seller (the "Security Agreement"); WHEREAS, pursuant to a subsequent stock split, the six shares of Purchaser's common stock acquired by Seller were converted into 372,341 shares of Purchaser's common stock (the "Shares"), which continue to be owned by Seller and constitute the only shares of Purchaser's common stock owned by Seller; and WHEREAS, Seller desires to sell, and Purchaser desires to purchase all of the Shares on the terms and conditions hereinafter set forth. NOW, THEREFORE, in consideration of the mutual benefits to be derived from this Agreement and the representations, warranties, conditions and promises hereinafter contained, the parties hereto hereby agree as follows: A G R E E M E N T: ARTICLE I SALE AND PURCHASE OF SHARES 1.1 PURCHASE AND SALE. Upon the terms and subject to the conditions set forth herein, at the Closing (as hereinafter defined) Seller shall sell the Shares to the Purchaser free and clear of all encumbrances (other than the security interest granted to Purchaser pursuant to the Security Agreement), and Purchaser shall purchase all of the Shares. 1.2 PURCHASE PRICE. Subject to and on the terms and conditions of this Agreement, Purchaser shall pay Seller a price of $450,000 for all of the Shares (the "Purchase Price"), which constitutes the total amount due, principal and all accrued interest, under the Note. Purchaser and Seller agree that the Purchase Price shall be paid by canceling the Note, in full consideration for the sale of the Shares to the Purchaser. -1- ARTICLE II REPRESENTATIONS AND WARRANTIES OF SELLER As a material inducement to Purchaser to enter into this Agreement, Seller hereby makes the following representations and warranties to Purchaser, each of which are made as of the date hereof, and shall be deemed made again as of the Closing Date (as hereinafter defined). 2.1 OWNERSHIP. Seller is the record and beneficial owner of all of the Shares and has good and marketable title to the Shares, free and clear of any encumbrances (other than the security interest granted to Purchaser pursuant to the Security Agreement). 2.2 AUTHORIZATION AND ENFORCEABILITY. (a) The execution, delivery and performance of this Agreement (and all other documents, instruments and agreements executed in connection herewith) by Seller has been duly authorized by all necessary partnership action on the part of Seller. This Agreement and all other documents, instruments and agreements executed by Seller in connection herewith constitute its legally valid and binding agreements, enforceable against Seller in accordance with their respective terms, except to the extent that enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting the enforceability of creditors' rights generally, or by general equitable principles. (b) Seller has the full and unqualified legal right, power and authority to sell, transfer, assign and convey to Purchaser complete and absolute legal and equitable title to all of the Shares, free and clear of any encumbrances (other than the security interest granted to Purchaser pursuant to the Security Agreement). On the Closing Date, upon consummation of the transactions contemplated hereby, the Purchaser will acquire complete and absolute legal, equitable, good, valid and marketable title to all of the Shares, free and clear of all encumbrances. 2.3 NO VIOLATIONS. The execution, delivery and other performance by Seller of this Agreement and all other documents, instruments and agreements executed in connection herewith, and the consummation by Seller of the transactions contemplated hereby, do not and will not (i) constitute a material violation of or default under (either immediately, upon notice or upon lapse of time) any provision of any material contract to which Seller is a party or by which it may be bound; (ii) result in the creation or imposition of any encumbrance upon, or give to any third person any interest in or right to, any of the Shares; or (iii) constitute a violation of any provision of Seller's partnership agreement. 2.4 BROKERS. There is no person acting on behalf of Seller who is entitled to or has any claim for any brokerage or finder's fee or commission in connection with the execution of this Agreement and the consummation of the transactions contemplated hereby. 2.5 ACCREDITED INVESTOR; INVESTOR KNOWLEDGE. Seller represents that it is an "accredited investor" within the meaning of Rule 501 promulgated under the Securities Act of 1933, as amended. Seller represents that, by reason of its business and financial experience, it -2- has such knowledge, sophistication and experience in business and financial matters as to be capable of evaluating the merits and risk of the sale of Shares contemplated by this Agreement. 2.6 ACCESS TO INFORMATION. Seller acknowledges that it has received all the information that it has requested from Purchaser about Purchaser in order to make an informed decision with respect to its sale of the Shares. Seller represents and warrants that it and its accountants, counsel, financial advisers and other representatives have been given reasonable access to all relevant information and records of Purchaser and that it has been given adequate opportunities to obtain any additional information and documents relating to the sale of the Shares and to ask questions and receive answers about all of the foregoing. ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE PURCHASER As a material inducement to Seller to enter into this Agreement, Purchaser hereby makes the following representations and warranties to Seller, each of which are made as of the date hereof, and shall be deemed made again as of the Closing Date. 3.1 BROKERS. There is no person acting on behalf of Purchaser who is entitled to or has any claim for any brokerage or finder's fee or commission in connection with the execution of this Agreement and the consummation of the transactions contemplated hereby. 3.2 AUTHORIZATION AND ENFORCEABILITY. The execution, delivery and performance of this Agreement (and all other documents, instruments and agreements executed in connection herewith) by Purchaser has been duly authorized by all necessary corporate action on the part of Purchaser. This Agreement and all other documents, instruments and agreements executed by Purchaser in connection herewith constitute its valid and legally binding agreements, enforceable against Purchaser in accordance with their respective terms, except to the extent that enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting the enforceability of creditors' rights generally, or by general equitable principles. 3.3 NO VIOLATIONS. The execution, delivery and other performance by Purchaser of this Agreement and all other documents, instruments and agreements executed in connection herewith, and the consummation by Purchaser of the transactions contemplated hereby, do not and will not constitute a material violation of or default under (either immediately, upon notice or upon lapse of time) its Certificate of Incorporation or Bylaws. ARTICLE IV CLOSING; OBLIGATIONS AT CLOSING 4.1 CLOSING. The closing for the consummation of the transactions contemplated by this Agreement (the "Closing") shall occur at such date ("Closing Date") and time as may be mutually agreed upon by the parties; provided, however, that the Closing shall take place on the date of this Agreement or within fifteen (15) days thereafter, unless the parties shall otherwise agree. -3- 4.2 OBLIGATIONS AT CLOSING. 4.2.1 SELLER'S OBLIGATIONS. Seller shall deliver to Purchaser at the Closing the following: (a) Stock Certificate No. 2006 (the "Stock Certificate") representing all of the Shares with a separate stock assignment executed in blank, in form reasonably acceptable to the Purchaser, together with any documentary stamps required in connection with such transfer or such other appropriate documents and instruments of transfer as Purchaser may reasonably request. Purchaser hereby acknowledges that, pursuant to the Security Agreement, it currently holds the Stock Certificate. (b) All other agreements, certificates, instruments and documents reasonably requested by Purchaser in order to fully consummate the transactions contemplated hereby and carry out the purposes and intent of this Agreement. 4.2.2 PURCHASER'S OBLIGATIONS TO SELLER AT CLOSING. Purchaser shall deliver to Seller at the Closing the following: (a) The original Note marked canceled, which shall constitute payment in full of the Purchase Price. ARTICLE V CONDITIONS PRECEDENT TO CLOSING 5.1 CONDITIONS PRECEDENT. The obligations of the Purchaser and the Seller under this Agreement are subject to the satisfaction on or before the Closing Date of the following conditions: 5.1.1 REPRESENTATIONS AND WARRANTIES TRUE. The representations and warranties of Seller and Purchaser herein shall be true and correct on and as of the Closing Date and shall not have been false or misleading in any manner on the date hereof. 5.1.2 PERFORMANCE OF TERMS AND CONDITIONS. All of the terms and conditions of this Agreement to be satisfied or performed by Seller and Purchaser on or before the Closing, including the deliveries required to be made at Closing, shall have been satisfied or performed. 5.1.3 APPROVAL OF DOCUMENTATION. The form and substance of all certificates, instruments and other documents delivered or in accordance with this Agreement shall be reasonably satisfactory to the party or parties to whom they are to be so delivered. -4- ARTICLE VI TERMINATION AND WAIVER 6.1 TERMINATION GENERALLY. This Agreement may, by notice given prior to the Closing, be terminated and abandoned by mutual written consent of the parties hereto. 6.2 WAIVER OR MODIFICATION OF AGREEMENT. Notwithstanding any provision to the contrary, any party hereto which is entitled to the benefits of this Agreement may, and has the right to, waive in writing its rights or benefits of any term or condition hereof at any time prior to, on or after the Closing Date. ARTICLE VII INDEMNIFICATION AND RELEASE 7.1 SELLER'S OBLIGATION TO INDEMNIFY. From and after the Closing Date, Seller shall indemnify and hold harmless Purchaser and its respective successors and assigns, officers, directors, shareholders, employees, advisors and agents, from and against any and all proceedings, judgments, obligations, losses, damages, deficiencies, settlements, assessments, charges, costs and expenses (including without limitation reasonable attorneys' fees, paralegals' fees, investigation expenses, court costs, interest and penalties) arising out of or in connection with, or caused by, directly or indirectly, any or all of the following: 7.1.1 Any misrepresentation, breach or failure of any warranty or representation made by Seller in this Agreement or pursuant hereto. 7.1.2 Any failure or refusal by Seller to satisfy or perform any term or condition of this Agreement to be satisfied or performed by Seller. 7.2 PURCHASER'S OBLIGATION TO INDEMNIFY. From and after the Closing Date, Purchaser shall indemnify and hold harmless Seller and its partners, successors and assigns, from and against any and all proceedings, judgments, obligations, losses, damages, deficiencies, settlements, assessments, charges, costs and expenses (including without limitation reasonable attorneys' fees, paralegals' fees, investigation expenses, court costs, interest and penalties) arising out of or in connection with, or caused by, directly or indirectly, any or all of the following: 7.2.1 Any misrepresentation, breach or failure of any warranty or representation made by Purchaser in this Agreement or pursuant hereto. 7.2.2 Any failure or refusal by Purchaser to satisfy or perform any term or condition of this Agreement to be satisfied or performed by Purchaser. -5- ARTICLE VIII MISCELLANEOUS 8.1 ASSIGNMENT. The respective rights and obligations of the parties under this Agreement shall not be assignable without the prior written consent of the other parties. This Agreement shall inure solely to the benefit of, and be binding upon, the parties hereto. 8.2 NOTICES. All notices, consents, requests, claims, demands, instructions or other communications given or made hereunder by the Purchaser or Seller shall be in writing and personally delivered or transmitted by registered or certified mail, postage prepaid, return receipt request, or by telex or facsimile to the parties at the following addresses: If to Purchaser, to: Cinergi Pictures Entertainment Inc. 2308 Broadway Santa Monica, CA 90404-2916 Attention: Warren Braverman Fax No. (310) 828-3861 If to Seller, to: Ziffren, Brittenham, Branca & Fischer 2121 Avenue of the Stars Thirty-Second Floor Los Angeles, California 90067 Attention: Harry M. Brittenham or to such other person or address as any party may from time to time designate by notice to the others. All such notices, consents, requests, claims, demands, instructions and other communications shall be deemed to have been received on the date of personal delivery, telex or facsimile or on the date of receipt if mailed. 8.3 ENTIRE AGREEMENT. This Agreement and the other agreements and documents referred to herein set forth the entire understanding of the parties relating to the subject matter hereof and supersede all prior agreements and understandings, whether oral or written. 8.4 GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of California regardless of the law of choice of law, or conflicts of law, of that or any other jurisdiction. 8.5 FURTHER ASSURANCES. At any time and from time to time after the Closing Date, at Purchaser's request and without further consideration, Seller shall promptly execute and deliver all such further agreements, certificates, instruments and documents and perform such further actions that the Purchaser may reasonably request, in order to fully consummate the transactions contemplated hereby and carry out the purposes and intent of this Agreement. -6- 8.6 AMENDMENT; WAIVER. No attempted amendment, modification, termination, discharge or change of this Agreement shall be valid and effective, unless the parties shall unanimously agree in writing to such amendment. No waiver of any provision of this Agreement shall be effective unless it is in writing and signed by the party against whom it is asserted, and any such written waiver shall only be applicable to the specific instance to which it relates and shall not be deemed to be a continuing or future waiver. 8.7 SECURITY AGREEMENT. Effective as of the Closing Date, pursuant to Section 10.1 of the Security Agreement, the Obligations (as such term is defined in the Security Agreement) shall be deemed terminated and the Security Agreement shall terminate. IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written. PURCHASER: CINERGI PICTURES ENTERTAINMENT INC. By: /s/ Warrren Braverman -------------------------------------------- Name: Warren Braverman Title: Chief Financial Officer SELLER: ZIFFREN, BRITTENHAM, BRANCA & FISCHER By: /s/ Kenneth Ziffren --------------------------------------------- Name: Kenneth Ziffren Title: Partner By his signature below, the undersigned (i) acknowledges that he has read, understands and agrees to the foregoing Agreement, (ii) agrees to waive any rights he may have to purchase the Shares pursuant to that certain letter agreement dated April 27, 1994 between Cinergi Pictures Entertainment Inc. and Ziffren, Brittenham, Branca & Fischer (the "Letter Agreement"), and (iii) agrees that the Letter Agreement and any rights of the undersigned thereunder shall hereby terminate. /s/ Andrew G. Vajna - ----------------------------------------------- Andrew G. Vajna -7- EX-10.2 3 EXHIBIT 10.2 STOCK PURCHASE AGREEMENT 12-30-96 STOCK PURCHASE AGREEMENT THIS STOCK PURCHASE AGREEMENT (the "Agreement") is made and entered into as of the 30th day of December, 1996, by and between Dianne Caplan Lebovits ("Seller") and Cinergi Pictures Entertainment Inc., a Delaware corporation ("Purchaser"). R E C I T A L S: WHEREAS, pursuant to that certain Stock Sale and Repurchase Agreement ("Stock Agreement") dated as of January 1, 1994 by and between Purchaser and Seller, Seller acquired six shares of the Purchaser's common stock; WHEREAS, Seller paid for such shares by paying an amount in cash equal to the aggregate par value of such shares and by issuing to Purchaser a Secured Recourse Promissory Note (the "Old Note") in the principal amount of $450,000, bearing interest at the rate of 6% per annum and secured in accordance with that certain Security and Stock Pledge Agreement, dated as of January 1, 1994, by and between Purchaser and Seller (the "Old Security Agreement"); WHEREAS, pursuant to a subsequent stock split (the "Stock Split"), the six shares of Purchaser's common stock acquired by Seller were converted into 372,341 shares of Purchaser's common stock (the "Shares"), which continue to be owned by Seller; WHEREAS, Seller retired a portion of the Old Note by issuing a full recourse note (the "New Note"; the Old Note and the New Note being sometimes collectively referred to herein as the "Notes") in the principal amount of $242,000, bearing interest at the rate of 6% per annum and secured in accordance with that certain Security and Pledge Agreement, dated as of February 28, 1995, by and between Purchaser and Seller which granted to Purchaser a security interest in certain marketable securities (the "New Security Agreement"); WHEREAS, after the issuance of the New Note, the Old Security Agreement only applied to 186,170 of the Shares; WHEREAS, Seller resigned her employment with the Purchaser on August 15, 1996; WHEREAS, pursuant to Section 4(a)(i) of the Stock Agreement, any non-vested Shares (as described therein) are to be repurchased by the Purchaser if Seller ceases to be employed by the Purchaser at the price originally paid ($1.20856953 per share after giving effect to the Stock Split) and such price is to be paid by first applying such price to the balance due under the Notes; WHEREAS, at the date of Seller's resignation, 51,714 Shares were not considered vested; and -1- WHEREAS, Seller desires to sell, and Purchaser desires to purchase all of the Shares on the terms and conditions hereinafter set forth. NOW, THEREFORE, in consideration of the mutual benefits to be derived from this Agreement and the representations, warranties, conditions and promises hereinafter contained, the parties hereto hereby agree as follows: A G R E E M E N T: ARTICLE I SALE AND PURCHASE OF SHARES 1.1 PURCHASE AND SALE. Upon the terms and subject to the conditions set forth herein, at the Closing (as hereinafter defined) Seller shall sell the Shares to the Purchaser free and clear of all encumbrances (other than the security interest granted to Purchaser pursuant to the Old Security Agreement), and Purchaser shall purchase all of the Shares. 1.2 PURCHASE PRICE. Subject to and on the terms and conditions of this Agreement, Purchaser shall pay Seller as follows: 1.2.1 NON-VESTED SHARES. Pursuant to Section 4(a)(i) of the Stock Agreement, Purchaser shall pay to Seller for the purchase of 51,714 of the Shares (constituting the non-vested Shares), the purchase price of $62,500. In accordance with the Stock Agreement, such amount shall be paid by reducing the balance due under the Notes. 1.2.2 VESTED SHARES. Purchaser shall pay to Seller for the purchase of 320,627 of the Shares (constituting all of the Shares other than the non-vested Shares), the purchase price of $468,426 (which constitutes the total remaining amount due, principal and all accrued interest, under the Notes after the reduction set forth in Section 1.2.1). Purchaser and Seller agree that such purchase price shall be paid by delivering the Notes (marked canceled) to Seller in exchange for the applicable Shares. Collectively, the amounts due under Sections 1.2.1 and 1.2.2 shall be referred to herein as the "Purchase Price", and payment of the Purchase Price in accordance with Sections 1.2.1 and 1.2.2 shall constitute full consideration for the sale of the Shares to Purchaser. ARTICLE II REPRESENTATIONS AND WARRANTIES OF SELLER As a material inducement to Purchaser to enter into this Agreement, Seller hereby makes the following representations and warranties to Purchaser, each of which are made as of the date hereof, and shall be deemed made again as of the Closing Date (as hereinafter defined). 2.1 OWNERSHIP. Seller is the record and beneficial owner of all of the Shares and has good and marketable title to the Shares, free and clear of any encumbrances (other than the security interest granted to Purchaser pursuant to the Security Agreement). -2- 2.2 AUTHORIZATION AND ENFORCEABILITY. (a) This Agreement (and all other documents, instruments and agreements executed in connection herewith by Seller) has been duly executed and delivered by Seller. This Agreement and all other documents, instruments and agreements executed by Seller in connection herewith constitute Seller's legally valid and binding agreements, enforceable against Seller in accordance with their respective terms, except to the extent that enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting the enforceability of creditors' rights generally, or by general equitable principles. (b) Seller has the full and unqualified legal right, power and authority to sell, transfer, assign and convey to Purchaser complete and absolute legal and equitable title to all of the Shares, free and clear of any encumbrances (other than the security interest granted to Purchaser pursuant to the Security Agreement). On the Closing Date, upon consummation of the transactions contemplated hereby, the Purchaser will acquire complete and absolute legal, equitable, good, valid and marketable title to all of the Shares, free and clear of all encumbrances. 2.3 NO VIOLATIONS. The execution, delivery and other performance by Seller of this Agreement and all other documents, instruments and agreements executed in connection herewith, and the consummation by Seller of the transactions contemplated hereby, do not and will not (i) constitute a material violation of or default under (either immediately, upon notice or upon lapse of time) any provision of any material contract to which Seller is a party or by which it may be bound; or (ii) result in the creation or imposition of any encumbrance upon, or give to any third person any interest in or right to, any of the Shares. 2.4 BROKERS. There is no person acting on behalf of Seller who is entitled to or has any claim for any brokerage or finder's fee or commission in connection with the execution of this Agreement and the consummation of the transactions contemplated hereby. 2.5 ACCREDITED INVESTOR; INVESTOR KNOWLEDGE. Seller represents that she is an "accredited investor" within the meaning of Rule 501 promulgated under the Securities Act of 1933, as amended. Seller represents that, by reason of her business and financial experience, she has such knowledge, sophistication and experience in business and financial matters as to be capable of evaluating the merits and risk of the sale of Shares contemplated by this Agreement. 2.6 ACCESS TO INFORMATION. Seller acknowledges that she has received all the information that she has requested from Purchaser about Purchaser in order to make an informed decision with respect to her sale of the Shares. Seller represents and warrants that she and her accountants, counsel, financial advisers and other representatives have been given reasonable access to all relevant information and records of Purchaser and that she has been given adequate opportunities to obtain any additional information and documents relating to the sale of the Shares and to ask questions and receive answers about all of the foregoing. -3- ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE PURCHASER As a material inducement to Seller to enter into this Agreement, Purchaser hereby makes the following representations and warranties to Seller, each of which are made as of the date hereof, and shall be deemed made again as of the Closing Date. 3.1 BROKERS. There is no person acting on behalf of Purchaser who is entitled to or has any claim for any brokerage or finder's fee or commission in connection with the execution of this Agreement and the consummation of the transactions contemplated hereby. 3.2 AUTHORIZATION AND ENFORCEABILITY. The execution, delivery and performance of this Agreement (and all other documents, instruments and agreements executed in connection herewith) by Purchaser has been duly authorized by all necessary corporate action on the part of Purchaser. This Agreement and all other documents, instruments and agreements executed by Purchaser in connection herewith constitute its valid and legally binding agreements, enforceable against Purchaser in accordance with their respective terms, except to the extent that enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting the enforceability of creditors' rights generally, or by general equitable principles. 3.3 NO VIOLATIONS. The execution, delivery and other performance by Purchaser of this Agreement and all other documents, instruments and agreements executed in connection herewith, and the consummation by Purchaser of the transactions contemplated hereby, do not and will not constitute a material violation of or default under (either immediately, upon notice or upon lapse of time) its Certificate of Incorporation or Bylaws. ARTICLE IV CLOSING; OBLIGATIONS AT CLOSING 4.1 CLOSING. The closing for the consummation of the transactions contemplated by this Agreement (the "Closing") shall occur at such date ("Closing Date") and time as may be mutually agreed upon by the parties; provided, however, that the Closing shall take place on the date of this Agreement or within fifteen (15) days thereafter, unless the parties shall otherwise agree. 4.2 OBLIGATIONS AT CLOSING. 4.2.1 SELLER'S OBLIGATIONS. Seller shall deliver to Purchaser at the Closing the following: (a) Stock Certificate No. 2005 (the "Stock Certificate") representing all of the Shares with a separate stock assignment executed in blank, in form reasonably acceptable to the Purchaser, together with any documentary stamps required in connection with such transfer or such other appropriate documents and instruments of transfer as Purchaser may -4- reasonably request. Purchaser hereby acknowledges that, pursuant to the Security Agreement, it currently holds the Stock Certificate. (b) All other agreements, certificates, instruments and documents reasonably requested by Purchaser in order to fully consummate the transactions contemplated hereby and carry out the purposes and intent of this Agreement. 4.2.2 PURCHASER'S OBLIGATIONS TO SELLER AT CLOSING. Purchaser shall deliver to Seller at the Closing the following: (a) The Notes each marked canceled, which shall constitute payment in full of the Purchase Price. (b) A release of the security interest which had been granted pursuant to the New Security Agreement. ARTICLE V CONDITIONS PRECEDENT TO CLOSING 5.1 CONDITIONS PRECEDENT. The obligations of the Purchaser and the Seller under this Agreement are subject to the satisfaction on or before the Closing Date of the following conditions: 5.1.1 REPRESENTATIONS AND WARRANTIES TRUE. The representations and warranties of Seller and Purchaser herein shall be true and correct on and as of the Closing Date and shall not have been false or misleading in any manner on the date hereof. 5.1.2 PERFORMANCE OF TERMS AND CONDITIONS. All of the terms and conditions of this Agreement to be satisfied or performed by Seller and Purchaser on or before the Closing, including the deliveries required to be made at Closing, shall have been satisfied or performed. 5.1.3 APPROVAL OF DOCUMENTATION. The form and substance of all certificates, instruments and other documents delivered or in accordance with this Agreement shall be reasonably satisfactory to the party or parties to whom they are to be so delivered. ARTICLE VI TERMINATION AND WAIVER 6.1 TERMINATION GENERALLY. This Agreement may, by notice given prior to the Closing, be terminated and abandoned by mutual written consent of the parties hereto. 6.2 WAIVER OR MODIFICATION OF AGREEMENT. Notwithstanding any provision to the contrary, any party hereto which is entitled to the benefits of this Agreement may, and has the right to, waive in writing its rights or benefits of any term or condition hereof at any time prior to, on or after the Closing Date. -5- ARTICLE VII INDEMNIFICATION AND RELEASE 7.1 SELLER'S OBLIGATION TO INDEMNIFY. From and after the Closing Date, Seller shall indemnify and hold harmless Purchaser and its respective successors and assigns, officers, directors, shareholders, employees, advisors and agents, from and against any and all proceedings, judgments, obligations, losses, damages, deficiencies, settlements, assessments, charges, costs and expenses (including without limitation reasonable attorneys' fees, paralegals' fees, investigation expenses, court costs, interest and penalties) arising out of or in connection with, or caused by, directly or indirectly, any or all of the following: 7.1.1 Any misrepresentation, breach or failure of any warranty or representation made by Seller in this Agreement or pursuant hereto. 7.1.2 Any failure or refusal by Seller to satisfy or perform any term or condition of this Agreement to be satisfied or performed by Seller. 7.2 PURCHASER'S OBLIGATION TO INDEMNIFY. From and after the Closing Date, Purchaser shall indemnify and hold harmless Seller and her successors and assigns, from and against any and all proceedings, judgments, obligations, losses, damages, deficiencies, settlements, assessments, charges, costs and expenses (including without limitation reasonable attorneys' fees, paralegals' fees, investigation expenses, court costs, interest and penalties) arising out of or in connection with, or caused by, directly or indirectly, any or all of the following: 7.2.1 Any misrepresentation, breach or failure of any warranty or representation made by Purchaser in this Agreement or pursuant hereto. 7.2.2 Any failure or refusal by Purchaser to satisfy or perform any term or condition of this Agreement to be satisfied or performed by Purchaser. ARTICLE VIII MISCELLANEOUS 8.1 ASSIGNMENT. The respective rights and obligations of the parties under this Agreement shall not be assignable without the prior written consent of the other parties. This Agreement shall inure solely to the benefit of, and be binding upon, the parties hereto. 8.2 NOTICES. All notices, consents, requests, claims, demands, instructions or other communications given or made hereunder by the Purchaser or Seller shall be in writing and personally delivered or transmitted by registered or certified mail, postage prepaid, return receipt request, or by telex or facsimile to the parties at the following addresses: -6- If to Purchaser, to: Cinergi Pictures Entertainment Inc. 2308 Broadway Santa Monica, CA 90404-2916 Attention: Warren Braverman Fax No. (310) 828-3861 If to Seller, to: Dianne Caplan Lebovits 10318 Glenbarr Avenue Los Angeles, CA 90064 or to such other person or address as any party may from time to time designate by notice to the others. All such notices, consents, requests, claims, demands, instructions and other communications shall be deemed to have been received on the date of personal delivery, telex or facsimile or on the date of receipt if mailed. 8.3 ENTIRE AGREEMENT. This Agreement and the other agreements and documents referred to herein set forth the entire understanding of the parties relating to the subject matter hereof and supersede all prior agreements and understandings, whether oral or written. 8.4 GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of California regardless of the law of choice of law, or conflicts of law, of that or any other jurisdiction. 8.5 FURTHER ASSURANCES. At any time and from time to time after the Closing Date, at Purchaser's request and without further consideration, Seller shall promptly execute and deliver all such further agreements, certificates, instruments and documents and perform such further actions that the Purchaser may reasonably request, in order to fully consummate the transactions contemplated hereby and carry out the purposes and intent of this Agreement. 8.6 AMENDMENT; WAIVER. No attempted amendment, modification, termination, discharge or change of this Agreement shall be valid and effective, unless the parties shall unanimously agree in writing to such amendment. No waiver of any provision of this Agreement shall be effective unless it is in writing and signed by the party against whom it is asserted, and any such written waiver shall only be applicable to the specific instance to which it relates and shall not be deemed to be a continuing or future waiver. 8.7 SECURITY AGREEMENT. Effective as of the Closing Date, pursuant to Section 10.1 of the Old Security Agreement, the Obligations (as such term is defined in the Old Security Agreement) shall be deemed terminated and the Old Security Agreement shall terminate. The New Security Agreement shall also be deemed terminated as of the Closing Date. -7- IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written. PURCHASER: CINERGI PICTURES ENTERTAINMENT INC. /s/ Warren Braverman ---------------------------------- Name: Warren Braverman Title: Chief Financial Officer SELLER: DIANNE CAPLAN LEBOVITS By: /s/ Dianne Caplan Lebovits ------------------------------ By his signature below, the undersigned (i) acknowledges that he has read, understands and agrees to the foregoing Agreement, (ii) agrees to waive any rights he may have to purchase the Shares pursuant to that certain letter agreement dated April 27, 1994 between Cinergi Pictures Entertainment Inc. and Dianne Caplan Lebovits (the "Letter Agreement"), and (iii) agrees that the Letter Agreement and any rights of the undersigned thereunder shall hereby terminate. /s/ Andrew G. Vajna - ---------------------------------------- Andrew G. Vajna -8- EX-10.3 4 EXHIBIT 10.3 AMENDMENT TO RESTATED EMPLYMT AGRMT AMENDMENT TO RESTATED EMPLOYMENT AGREEMENT This Amendment to Restated Employment Agreement (the "Amendment") is dated as of January 1, 1997 by and between Cinergi Pictures Entertainment Inc., a Delaware corporation ("Company"), and Warren Braverman (the "Executive") and is made with reference to that certain Restated Employment Agreement between the Company (then known as "Cinergi Productions Inc.") and Executive dated as of January 1, 1994, as amended by that certain letter agreement, dated as of December 16, 1994, by and between Company and Executive (as so amended, the "Employment Agreement"). Capitalized terms used herein without definition shall have the respective meanings assigned such terms in the Employment Agreement. WHEREAS, Executive has been Chief Operating Officer, Executive Vice President and Chief Financial Officer of the Company since March 1990; and WHEREAS, during all of the period commencing from the above date, Executive has been a loyal and dedicated officer and employee of the Company, devoting his time and energies to the success of the Company; and WHEREAS, Executive and the Company formalized their relationship by entering into the Employment Agreement which expires December 31, 1997; and WHEREAS, the Company is conducting a strategic review of the Company's business strategy and goals, which includes discussions with third parties regarding the sale of a partial interest in the Company or the entire Company; and WHEREAS, Executive possesses special skills, knowledge, abilities and experience unique to the Company's business and possesses an intimate knowledge of the operations of the Company which the Company deems valuable and desires to maintain; and WHEREAS, the Board of Directors of the Company recognizes that the expiration of the Employment Agreement at the end of 1997, as well as the possibility of a sale of a partial interest in the Company or the entire Company, may raise uncertainty and questions for Executive, and may result in the distraction of Executive to the detriment of the Company and its stockholders; and WHEREAS, the Board of Directors of the Company has determined that it is in the best interests of the Company to foster and encourage the continued attention and dedication of Executive to his assigned duties, without distraction, and to secure for the Company the continued services of Executive for an additional period of time; and WHEREAS, the Company and Executive have mutually agreed to extend Executive's term of employment to secure to the Company the continued valuable services of Executive, all on the terms and conditions hereinafter set forth. -1- NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein, the parties hereto hereby agree to amend the Employment Agreement as follows: 1. AMENDMENT TO SECTION 1.4.1 OF THE EMPLOYMENT AGREEMENT. Section 1.4.1 of the Employment Agreement is hereby deleted in its entirety and replaced as follows: 1.4.1 The Term of this Agreement shall commence and this Agreement shall be effective as of the date first written above and shall end on December 31, 1999 unless extended or sooner terminated in accordance with the provisions of this Agreement (the "Term"). 2. AMENDMENT TO SECTION 2.1 OF THE EMPLOYMENT AGREEMENT. Section 2.1 of the Employment Agreement is hereby deleted in its entirety and replaced as follows: 2.1 FIXED ANNUAL COMPENSATION. Executive shall receive Fixed Annual Compensation as follows: Four Hundred Sixty- Five Thousand Dollars ($465,000) for the period from the effective date hereof and ending December 31, 1994; Five Hundred Eight Thousand Dollars ($508,000) for a period of January 1, 1995 through December 31, 1995; Five Hundred Thirty-One Thousand Dollars ($531,000) for the period of January 1, 1996 through December 31, 1996; Five Hundred Fifty-Six Thousand Dollars ($556,000) for the period of January 1, 1997 through December 31, 1997; Five Hundred Eighty-Four Thousand Dollars ($584,000) for the period of January 1, 1998 through December 31, 1998; and Six Hundred Thirteen Thousand Dollars ($613,000) for the period of January 1, 1999 through December 31, 1999. Executive's Fixed Annual Compensation shall be payable in equal installments on Company's regular pay dates following commencement of the Term. 3. AMENDMENT TO SECTION 3.4 OF THE EMPLOYMENT AGREEMENT. Section 3.4 of the Employment Agreement is hereby deleted in its entirety and replaced as follows: 3.4 NO MITIGATION. Executive shall not be required to mitigate the amount of any payment or benefit to Executive provided for in Section 3.2.2 due to Company's Material Breach (each, a "Company Breach Benefit") by seeking other employment or otherwise, nor shall the amount of any Company Breach Benefit be reduced by any compensation earned by Executive as the result of employment by another employer or by retirement benefits after the date of termination. The Company shall not be entitled to any rights to offset, mitigate or otherwise reduce the Company Breach Benefits owing to Executive by virtue of Section 3.2.2 with respect -2- to any rights, claims or damages that the Company or its affiliates may have against Executive, including, without limitation, any claims by reason of any breach or alleged breach of this Agreement by Executive. 4. SIGNING BONUS. In order to induce Executive to enter into this Amendment and extend the Term of the Employment Agreement for two years, the Company hereby agrees to pay to Executive a signing bonus of $600,000 (the "Signing Bonus") immediately upon the signing of this Amendment. Executive and the Company agree that Executive shall use a portion of the Signing Bonus to immediately repay in full the Executive Loan and the Second Executive Loan. Upon payment of such loans, the Company hereby agrees to indicate in its accounting records that such loans have been repaid in full. 5. MISCELLANEOUS. 5.1 Executive has been advised of the desirability for him to obtain legal counsel to advise him of his rights under this Amendment. Executive acknowledges that he has read and understands the terms of this Amendment and that he enters into this Amendment knowingly and intelligently of his own free will, free of any undue influence. 5.2 This Amendment shall be effective as of the date set forth above. This Amendment may be executed in one or more counterparts, each of which shall be deemed an original, and it shall not be necessary in making proof of the Amendment to produce or account for more than one such counterpart. 5.3 On and after the date hereof, each reference in the Employment Agreement to "this Agreement," "hereunder," "hereof," "herein" or words of like import referring to the Employment Agreement shall mean and be a reference to the Employment Agreement as amended by this Amendment. 5.4 It is hereby agreed that, except as specifically provided herein, this Amendment does not in any way affect or impair the terms and conditions of the Employment Agreement, and all terms and conditions of the Employment Agreement are to remain in full force and effect unless otherwise specifically amended, waived or changed pursuant to the terms and conditions of this Amendment. 5.5 Subject to Section 4.5 of the Employment Agreement, this Amendment shall be governed by, construed and enforced and the legality and validity of each term and condition shall be determined in accordance with the internal, substantive laws of the State of California applicable to agreements fully executed and performed entirely in California. -3- IN WITNESS WHEREOF, the parties hereto have duly executed this Amendment as of the date first written above. "Company" CINERGI PICTURES ENTERTAINMENT INC. By: /s/ Andrew G. Vajna ---------------------------------------- Name: Andrew G. Vajna Title: Chief Executive Officer "Executive" /s/ Warren Braverman -------------------------------------------- WARREN BRAVERMAN -4- -----END PRIVACY-ENHANCED MESSAGE-----