EXHIBIT 4.3
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement is made as of the 4th day of May, 1998
(the "Agreement") between Four Media Company, a Delaware corporation ("4MC"),
and Michael Herbert, an individual ("Herbert"); Greg Howard, an individual
("Howard"); Michael Flanagan, an individual ("M. Flanagan"); and Thomas
Flanagan, an individual ("T. Flanagan") (collectively the "Initial Sellers"),
with reference to the following facts:
A. Pursuant to the Asset Purchase Agreement and Plan of Reorganization
dated April 27, 1998, among Video Symphony, Inc., a California corporation
("VS"); Digital Doctors, Inc., a California corporation ("DD"); the Initial
Sellers; 4MC; and VSDD Acquisition Corp., a Delaware corporation ("Acquisition")
(the "Purchase Agreement"), 4MC has agreed to issue and sell to VS shares of its
common stock, $.01 par value par share (the "Common Stock") which shares will be
distributed by VS to the Initial Sellers.
B. 4MC has agreed to provide with respect to the Common Stock issued
pursuant to the Purchase Agreement certain registration rights under the
Securities Act.
NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
contained herein, the parties agree as follows:
1. Definitions. As used in this Agreement, the following terms shall have the
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meaning set forth below.
1.1 "Commission" means the Securities and Exchange Commission.
1.2 "Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the Commission thereunder, or any similar
successor statute.
1.3 "4MC Shares" means the Common Stock issued pursuant to the Purchase
Agreement; provided, however, a share of Common Stock shall cease to be a 4MC
Share for purposes of this Agreement when it no longer is a Restricted Security.
1.4 "Person" means any individual, partnership, corporation, limited
liability company, joint stock company, association, trust, unincorporated
organization or a government or agency or political subdivision thereof.
1.5 "Prospectus" means the prospectus included in the Registration
Statement, as amended or supplemented, including all material incorporated by
reference in such prospectus and all documents filed after the date of such
prospectus by 4MC under the Exchange Act and incorporated by reference therein.
1.6 "Registration Expenses" means any and all expenses incident to
performance of or compliance with this Agreement including, without limitation,
(i) all Commission and stock exchange or National Association of Securities
Dealers registration and filing fees, (ii) all fees and expenses of complying
with securities or blue sky laws; (iii) all printing, messenger and delivery
expenses; and (iv) the fees and disbursements of counsel for the Company and of
its independent public accountants; but excluding underwriting discounts and
commissions and transfer taxes, if any.
1.7 "Registration Statement" means a registration statement of 4MC filed
under the Securities Act on Form S-3 providing for the registration of, and the
sale on a continuous or delayed basis by the holders of, all of the 4MC Shares
pursuant to Rule 415 under the Securities Act, including the Prospectus
contained therein and forming a part thereof, any amendments to such
registration statement and supplements to such Prospectus, and all exhibits and
other material incorporated by reference in such registration statement and
Prospectus.
1.8 "Restricted Security" means any share of Common Stock issued or
issuable pursuant to the Purchase Agreement except any such share that (i) has
been registered pursuant to an effective registration statement under the
Securities Act and sold in a manner contemplated by the Prospectus, or (ii) has
been transferred in compliance with the resale provisions of Rule 144 under the
Securities Act (or any successor provision thereto) or is transferable pursuant
to paragraph (k) of Rule 144 under the Securities Act (or any successor
provision thereto).
1.9 "Securities Act" means the Securities Act of 1933, as amended and the
rules and regulations of the Commission thereunder, or any similar successor
statute.
1.10 "Sellers" means, collectively, the Initial Sellers and any
transferees or assignees of 4MC Shares who agree to become bound by all of the
terms and provisions of this Agreement in accordance with Section 8 hereof.
2. Registration
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2.1 Filing and Effectiveness of Registration Statement. Promptly after
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4MC files with the Commission a Form 8-K, or amendment to Form 8-K, reporting
the transactions contemplated by the Purchase Agreement and including the
financial statements
required in connection therewith, 4MC shall file with the Commission the
Registration Statement. 4MC shall thereupon use its best efforts to cause the
Commission to declare the Registration Statement effective under the Securities
Act as promptly as practicable.
2.2 Eligibility for Use of Form S-3. 4MC agrees that it shall file all
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reports and information required to be filed by it with the Commission in a
timely manner and take all such other action so as to maintain eligibility for
the use of Form S-3.
3. Post-Registration Procedure
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3.1 4MC shall promptly (i) prepare and file with the Commission such
amendments (including post-effective amendments) to the Registration Statement
and supplements to the Prospectus as may be necessary to keep the Registration
Statement continuously effective and in compliance with the provisions of the
Securities Act applicable thereto so as to permit the Prospectus forming part
thereof to be current and usable by the Sellers for resales of the 4MC Shares
for a period of two (2) years from the Closing (as defined in the Purchase
Agreement) or such shorter period that will terminate when all the 4MC Shares
covered by the Registration Statement are no longer Restricted Shares (the
"Registration Period"), and (ii) take all lawful action such that each of (A)
the Registration Statement and any amendment thereto does not, when it becomes
effective, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein, not misleading, and (B) the Prospectus forming part of the Registration
Statement, and any amendment or supplement thereto, does not at any time during
the Registration Period include an untrue statement of a material fact or omit
to state 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. Notwithstanding the foregoing provisions of this Section 3.1,
4MC may, during the Registration Period, suspend the use of the Prospectus for a
period not to exceed ninety (90) days (whether or not consecutive) in any 12-
month period if the Board of Directors of 4MC determines in good faith that
because of valid business reasons, including pending mergers or other business
combination transactions, the planned acquisition or divestiture of assets,
pending material corporate developments and similar events, it is in the best
interests of 4MC to suspend such use, and prior to or contemporaneously with
suspending such use, 4MC provides the Sellers with written notice of such
suspension, which notice need not specify the nature of the event giving rise to
such suspension. At the end of any such suspension period, 4MC shall provide
the Sellers with written notice of the termination of such suspension.
3.2 4MC shall (i) prior to the filing with the Commission of any
Registration Statement (including any amendments thereto) and the distribution
or delivery of any Prospectus (including any supplements thereto), provide draft
copies thereof to the Sellers and reflect in such documents all such comments as
the Sellers (and their counsel) reasonably may propose, and (ii) furnish to each
Seller whose 4MC Shares are included in the Registration Statement and its legal
counsel identified by 4MC, (A) promptly after the same is prepared and publicly
distributed, filed with the Commission, or received by 4MC, one copy of the
Registration Statement, each Prospectus, and each amendment or supplement
thereto, and (B) such number of copies of the Prospectus and all amendments
and supplements thereto and such other documents, as such Seller may reasonably
request in order to facilitate the disposition of the 4MC Shares owned by such
Seller.
3.3 4MC shall (i) register or qualify the 4MC Shares covered by the
Registration Statement under such securities or "blue sky" laws of such
jurisdictions as Sellers reasonably request, (ii) prepare and file in such
jurisdictions such amendments (including post-effective amendments) and
supplements to such registrations and qualifications as may be necessary to
maintain the effectiveness thereof at all times during the Registration Period,
(iii) take all such other lawful actions as may be necessary to maintain such
registrations and qualifications in effect at all times during the Registration
Period, and (iv) take all such other lawful actions reasonably necessary or
advisable to qualify the 4MC Shares for sale in such jurisdictions, provided,
however, that 4MC shall not be required in connection therewith or as a
condition thereto to (A) qualify to do business in any jurisdiction where it
would not otherwise be required to qualify but for this Section 3.3, (B) subject
itself to general taxation in any such jurisdiction, or (C) file a general
consent to service of process in any such jurisdiction.
3.4 4MC shall, as promptly as practicable after becoming aware of such
event, notify each Seller of the occurrence of any event, as a result of which
the Prospectus included in the Registration Statement, as then in effect,
includes an untrue statement of a material fact or omits to state 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, and
promptly prepare an amendment to the Registration Statement and supplement to
the Prospectus to correct such untrue statement or omission, and deliver a
number of copies of such supplement and amendment to each Seller as such Seller
may reasonably request.
3.5 4MC shall, as promptly as practicable after becoming aware of such
event, notify each Seller who holds 4MC Shares being sold of the issuance by the
Commission of any stop order or other suspension of the effectiveness of the
Registration Statement at the earliest possible time and take all lawful action
to effect the withdrawal, recision or removal of such stop order or other
suspension.
3.6 4MC shall cause all the 4MC Shares covered by the Registration
Statement to be listed on the principal national securities exchange, and
included in an inter-dealer quotation system of a registered national securities
association, on or in which securities of the same class or series issued by 4MC
are then listed or included.
3.7 4MC shall make generally available to its securityholders as soon as
practicable, but in no event later than eighteen (18) months after (i) the
effective date (as defined in Rule 158(c) under the Securities Act) of the
Registration Statement, and (ii) the effective date of each post-effective
amendment to the Registration Statement, as the case may be, an earnings
statement of 4MC and
its subsidiaries complying with Section 11(a) of the Securities Act and the
rules and regulations of the Commission thereunder (including, at the option of
4MC, Rule 158).
4. Obligations of the Sellers. In connection with the registration of the 4MC
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Shares, each Seller shall have the following obligations:
4.1 It shall be a condition precedent to the obligations of 4MC to
complete the registration pursuant to this Agreement with respect to the 4MC
Shares of a particular Seller that such Seller shall furnish to 4MC such
information regarding himself, the 4MC Shares held by him and the intended
method of disposition of the 4MC Shares held by him as shall be reasonably
required to effect the registration of such 4MC Shares and shall execute such
documents in connection with such registration as 4MC may reasonably request.
At least seven (7) days prior to the first anticipated filing date of the
Registration Statement, 4MC shall notify each Seller of the information 4MC
requires from each such Seller (the "Requested Information") if such Seller
elects to have any of its 4MC Shares included in the Registration Statement. If
at least two (2) business days prior to the anticipated filing date 4MC has not
received the Requested Information from a Seller (a "Non-Responsible Seller"),
then 4MC may file the Registration Statement without including 4MC Shares of
such Non-Responsive Seller and have no further obligations to the Non-Responsive
Seller.
4.2 Each Seller by its acceptance of the 4MC Shares agrees to cooperate
with 4MC in connection with the preparation and filing of the Registration
Statement hereunder, unless such Seller has notified 4MC in writing of his
election to exclude all of its 4MC Shares from the Registration Statement.
4.3 Each Seller agrees that, upon receipt of any notice from 4MC of the
occurrence of any event of the kind described in Section 3.4 or 3.5, it shall
immediately discontinue its disposition of 4MC Shares pursuant to the
Registration Statement covering such 4MC Shares until such Seller's receipt of
the copies of the supplemented or amended Prospectus contemplated by Section 3.4
or until such Seller's receipt of notice of withdrawal, recision or removal of
the stop order or other suspension referred to in Section 3.5.
5. Expenses of Registration. All Registration Expenses shall be borne by 4MC.
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6. Indemnification and Contribution.
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6.1 4MC shall indemnify and hold harmless each Seller (an "Indemnified
Person") from and against any losses, claims, damages or liabilities, joint or
several, to which such Indemnified Person may become subject under the
Securities Act or otherwise, insofar as losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or an omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any Prospectus or an
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and 4MC hereby agrees
to reimburse such Indemnified Person for all reasonable legal and other expenses
incurred by them in connection with investigating or defending any such action
or claim as and when such expenses are incurred; provided, however, that 4MC
shall not be liable to any such Indemnified Person in any such case to the
extent that any such loss, claim, damage or liability arises out of or is based
upon (i) any untrue statement or alleged untrue statement made in, or an
omission or alleged omission from, such Registration Statement or Prospectus in
reliance upon and in conformity with written information furnished to 4MC by
such Indemnified Person expressly for use therein or (ii) in the case of the
occurrence of an event of the type specified in Section 3.4, the use by the
Indemnified Person of an outdated or defective Prospectus after 4MC has provided
to such Indemnified Person an updated Prospectus correcting the untrue statement
or alleged untrue statement or omission or alleged omission giving rise to such
loss, claim, damage or liability.
6.2 Indemnification by the Sellers. Each Seller agrees, as a consequence
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of the inclusion of any of its 4MC Shares in a Registration Statement, severally
and not jointly, to (i) indemnify and hold harmless 4MC, its directors
(including any person who, with his or her consent, is named in the Registration
Statement as a director nominee of 4MC), its officers who sign any Registration
Statement and each person, if any, who controls 4MC within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act, against any
losses, claims, damages or liabilities to which 4MC or such other persons may
become subject, under the Securities Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon an untrue statement or alleged untrue statement of a material
fact contained in such Registration Statement or Prospectus or arise out of or
are based upon the 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, in the case of the
Prospectus), not misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written information
furnished to 4MC by such Seller expressly for use therein, and (ii) reimburse
4MC for any legal or other expenses incurred by 4MC in connection with
investigating or defending any such action or claim as such expenses are
incurred.
6.3 Notice of Claims, etc. Promptly after receipt by a party seeking
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indemnification pursuant to this Section 6 (an "Indemnified Party") of written
notice of any investigation, claim, proceeding or other action in respect of
which indemnification is being sought (each, a "Claim"), the Indemnified Party
promptly shall notify the party against whom indemnification pursuant to this
Section 6 is being sought (the "Indemnifying Party") of the commencement
thereof; but the omission to so notify the Indemnifying Party shall not relieve
it from any liability that it otherwise may have to the Indemnified Party,
except to the extent that the Indemnifying Party is materially prejudiced and
forfeits substantive rights and defenses by reason of such failure. In
connection with
any Claim as to which both the Indemnifying Party and the Indemnified Party are
parties, the Indemnifying Party shall be entitled to assume the defense thereof.
Notwithstanding the assumption of the defense of any Claim by the Indemnifying
Party, the Indemnified Party shall have the right to employ separate legal
counsel and to participate in the defense of such Claim, and the Indemnifying
Party shall bear the reasonable fees, out-of-pocket costs and expenses of such
separate legal counsel to the Indemnified Party if (and only if): (x) the
Indemnifying Party shall have agreed to pay such fees, costs and expenses, (y)
the Indemnified Party and the Indemnifying Party shall reasonably have concluded
that representation of the Indemnified Party and the Indemnifying Party by the
same legal counsel would not be appropriate due to actual or, as reasonably
determined by legal counsel to the Indemnified Party, potentially differing
interests between such parties in the conduct of the defense of such Claim, or
if there may be legal defenses available to the Indemnified Party that are in
addition to or disparate from those available to the Indemnifying Party, or (z)
the Indemnifying Party shall have failed to employ legal counsel reasonably
satisfactory to the Indemnified Party within a reasonable period of time after
notice of the commencement of such Claim. If the Indemnified Party employs
separate legal counsel in circumstances other than as described in clauses (x),
(y) and (z) above, the fees, costs and expenses of such legal counsel shall be
borne exclusively by the Indemnified Party. Except as provided above, the
Indemnifying Party shall not, in connection with any Claim in the same
jurisdiction, be liable for the fees and expenses of more than one firm of
counsel for the Indemnified Party (together with appropriate local counsel). The
Indemnifying Party shall not, without the prior written consent of the
Indemnified Party, settle or compromise any Claim or consent to the entry of any
judgment that does not include an unconditional release of the Indemnified Party
from all liabilities with respect to such Claim or judgment.
6.4 Contribution. If the indemnification provided for in this Section 6
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is unavailable to or insufficient to hold harmless an Indemnified Person under
Section 6.1 or 6.2 above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) 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, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative fault of the Indemnifying Party and the Indemnified Party in connection
with the statements or omissions which resulted in such losses, claims, damages
or liabilities (or actions in respect thereof); as well as any other relevant
equitable considerations. The relative fault of such Indemnifying Party and
Indemnified Party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by
such Indemnified Party or by such Indemnifying Party, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The parties hereto agree that it would not be just
and equitable if contribution pursuant to this Section 6.4 were determined by
pro rata allocation (even if the Sellers were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in this Section 6.4. The amount paid or
payable by an Indemnified Party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above shall be deemed to
include any legal or other fees or expenses reasonably incurred by such
Indemnified Party in connection with investigating or defending any such action
or claim. 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. The obligations of the Sellers in this Section 6.4
to contribute shall be several in proportion to the percentage of 4MC Shares
registered by them and not joint.
6.5 Notwithstanding any other provision of this Section 6, in no event
shall any Seller be required to undertake liability to any person under this
Section 6 for any amounts in excess of the dollar amount of the proceeds to be
received by such Seller from the sale of such Seller's 4MC Shares (after
deducting any fees, discounts and commissions applicable thereto) pursuant to
any Registration Statement under which such 4MC Shares are to be registered
under the Securities Act.
6.6 The obligations of 4MC under this Section 6 shall be in addition to
any liability which 4MC may otherwise have to any Indemnified Person and the
obligations of any Indemnified Person under this Section 6 shall be in addition
to any liability which such Indemnified Person may otherwise have to 4MC. The
remedies provided in this Section 6 are not exclusive and shall not limit any
rights or remedies which may otherwise be available to an indemnified party at
law or in equity.
7. Rule 144. With a view to making available to the Sellers the benefits of
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Rule 144 under the Securities Act or any other similar rule or regulation of the
Commission that may at any time permit the Sellers to sell securities of 4MC to
the public without registration ("Rule 144"), 4MC agrees to:
7.1 comply with the provisions of paragraph (c)(1) of Rule 144; and
7.2 file with the Commission in a timely manner all reports and other
documents required to be filed by 4MC pursuant to Section 13 or 15(d) under the
Exchange Act; and, if at any time it is not required to file such reports but in
the past had been required to or did file such reports, it will, upon the
request of any Seller, make available other information as required by, and so
long as necessary to permit sales of, its 4MC Shares pursuant to Rule 144.
8. Assignment. The rights to have 4MC register 4MC Shares pursuant to this
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Agreement shall be automatically assigned by the Seller to any transferee of all
or any portion of such securities only if: (a) the Seller agrees in writing
with the transferee or assignee to assign such rights, and a copy of such
agreement is furnished to 4MC within a reasonable time after such assignment,
(b) 4MC is, within a reasonable time after such transfer or assignment,
furnished with written notice of (i) the name and address of such transferee or
assignee and (ii) the securities with respect to which such registration rights
are being transferred or assigned, (c) immediately following such transfer or
assignment, the securities so transferred or assigned to the transferee
constitute Restricted Securities, and (d) at or before the time 4MC received the
written notice contemplated by clause (b) of this sentence the transferee or
assignee agrees in writing with 4MC to be bound by all of the provisions
contained herein.
9. Miscellaneous
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9.1 Notices. All notices, requests, demands, or other communications with
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respect to this Agreement shall be in writing and shall be (i) personally
delivered, (ii) sent by facsimile transmission, (iii) sent by the United States
Postal Service, registered or certified mail, return receipt requested, or (iv)
delivered by a nationally recognized express overnight courier service, charges
prepaid, to the following addresses (or such other addresses as the parties may
specify from time to time in accordance with this Section 9.1):
To 4MC: Four Media Company
2813 West Alameda Avenue
Burbank, CA 91505-4455
Attn: Robert T. Walston
Fax No.: (818) 846-5197
With a copy to: Greenberg Glusker Fields
Claman & Machtinger LLP
1900 Avenue of the Stars, Suite 2100
Los Angeles, CA 90067
Attn: Bernard Shearer, Esq.
Fax No.: (310) 553-0687
To Sellers: Michael Herbert
1019 Linda Glen Drive
Pasadena, CA 91105
Fax No.: 626/577-4726
Greg Howard
2046 Oakdale Avenue
Pasadena, CA 91107
Fax No.: 626/356-7444
Michael Flanagan
1915 Midwick Drive
Altadena, CA 91001
Fax No.: 626/398-3565
Thomas Flanagan
413 Tamarac Drive
Pasadena, CA 91105
Fax No.: 626/398-3565
With copy of notices Perkins Coie LLP
to VSDD and/or 1999 Avenue of the Stars, Ninth Floor
Shareholders to: Los Angeles, CA 90067
Attn: Leslie N. Murdock, Esq.
Fax No.: 310/788-3399
Any such notice shall, when sent in accordance with the preceding sentence,
be deemed to have been given and received on the earliest of (i) the day
delivered to such address, (ii) the day sent by facsimile transmission, (iii)
the fifth business day following the date deposited with the United States
Postal Service, or (iv) 24 hours after shipment by such courier service.
9.2 Remedies; Severability. The remedies provided in this Agreement are
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cumulative and not exclusive of any remedies provided by law. If any term,
provision, covenant or restriction of this Agreement is held by a court of
competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated, and the parties hereto shall use their best efforts to find and
employ an alternative means to achieve the same or substantially the same result
as that contemplated by such term, provision, covenant or restriction.
9.3 Arbitration; Attorneys' Fees.
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9.3(a) Any controversy or claim arising out of or relating to this
Agreement, its enforcement or interpretation, or because of an alleged breach,
default or misrepresentation in connection with any of its provisions, or
arising out of or relating in any way to the relationship between the parties,
shall be determined by binding arbitration. The arbitration proceedings shall
be held and conducted in accordance with California Code of Civil Procedure
Sections 1282-1284.2, with the power to grant equitable relief, including
injunctions and temporary restraining orders. California Code of Civil
Procedure Section 1283.05, which provides for certain discovery rights, shall
apply to any such arbitration, and said code section is hereby incorporated by
reference. In reaching a
decision, the arbitrator shall have no authority to change, extend, modify or
suspend any of the terms of this Agreement. The arbitration shall be commenced
and heard in Los Angeles County, California. The arbitrator shall apply the
substantive law (and the law of remedies, if applicable) of California or
federal law, or both, as applicable to the claim(s) asserted. Judgment on the
award may be entered in any court of competent jurisdiction. The parties may
seek, from a court of competent jurisdiction, provisional remedies or injunctive
relief in support of their respective rights and remedies hereunder without
waiving any right to arbitration. However, the merits of any action that
involves such provisional remedies or injunctive relief, including, without
limitation, the terms of any permanent injunction, shall be determined by
arbitration under this paragraph. If the parties do not agree upon an arbitrator
within ten (10) days after a written demand for arbitration is served upon one
party by the other, the arbitrator shall be appointed pursuant to Section 1281.6
of the California Code of Civil Procedure; provided, however, that only persons
who are retired Superior Court, California Appellate Court or federal judges or
lawyers admitted to the bar for at least twenty (20) years and classified as
"A-v" by the Martindale Hubbell Law Directory shall be eligible to be selected
as an arbitrator.
9.3(b) If any legal action, arbitration or other proceeding is
brought for the enforcement of this Agreement, or because of any alleged
dispute, breach, default or misrepresentation in connection with any of the
provisions of this Agreement, the successful or prevailing party shall be
entitled to recover reasonable attorneys' fees and other costs incurred therein,
in addition to any other relief to which it or they may be entitled. The court
or arbitrator shall consider, in determining the prevailing party, (i) which
party obtains relief which most nearly reflects the remedy or relief which the
parties sought, and (ii) any settlement offers made prior to commencement of the
trial in the proceeding.
9.4 Binding on Successors. Subject to the requirements of Section 8
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hereof, this Agreement shall inure to the benefit of and be binding upon the
successors and assigns of each of the parties hereto.
9.5 Counterparts. This Agreement may be executed in two or more
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counterparts, each of which shall be deemed an original, but all of which shall
together constitute one and the same Agreement.
9.6 No Implied Waiver; Remedies. No failure or delay on the part of the
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parties hereto to exercise any right, power, or privilege hereunder or under any
instrument executed pursuant hereto shall operate as a waiver nor shall any
single or partial exercise of any right, power, or privilege preclude any other
or further exercise thereof or the exercise of any other right, power, or
privilege. All rights, powers, and privileges granted herein shall be in
addition to other rights and remedies to which the parties may be entitled at
law or in equity.
9.7 Entire Agreement. This Agreement sets forth the entire understandings
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of the parties with respect to the subject matter hereof, and it incorporates
and merges any and all previous communications, understandings, oral or written
as to the subject matter hereof.
9.8 Amendments; Actual Waivers. Any provision of this Agreement may be
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amended and the observance thereof may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of 4MC and Sellers who hold a majority-in-interest of 4MC
Shares. Any amendment or waiver effected in accordance with this Section 9
shall be binding upon each Seller and 4MC.
9.9 Headings. The headings of the Sections of this Agreement, where
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employed, are for convenience only and do not form a part hereof and in no way
modify, interpret or construe the meanings of the parties.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day
and year first above written.
"4MC"
FOUR MEDIA COMPANY
By: /s/ Alan S. Unger
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Alan Unger
Chief Financial Officer
/s/ Michael Herbert
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Michael Herbert
/s/ Greg Howard
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Greg Howard
/s/ Michael Flanagan
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Michael Flanagan
/s/ Thomas Flanagan
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Thomas Flanagan