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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. _____)*
EQUITY MARKETING, INC.
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(Name of Issuer)
Common Stock, $.001 par value per share
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(Title of Class of Securities)
294724 10 9
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(CUSIP Number)
Donald A. Kurz with a copy to:
c/o Equity Marketing, Inc. Leland P. Smith, Esq.
6330 San Vicente Boulevard Equity Marketing, Inc.
Los Angeles, CA 90048 6330 San Vicente Boulevard
(323) 932-4300 Los Angeles, CA 90048
(323) 932-4300
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(Name, Address and Telephone Number of Person Authorized to Receive Notices and
Communications)
March 29, 2000
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of ss.ss.240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the
following box / /.
NOTE: Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See ss.240.13d-7(b) for
other parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section
of the Act but shall be subject to all other provisions of the Act (however,
see the Notes).
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CUSIP No. 294724 10 9
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1. NAMES OF REPORTING PERSONS.
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY).
Donald A. Kurz
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(A) X
(B)
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3. SEC USE ONLY
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4. SOURCE OF FUNDS (SEE INSTRUCTIONS) NOT APPLICABLE
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5. CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(D) OR 2(E)
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6. CITIZENSHIP OR PLACE OF ORGANIZATION UNITED STATES OF AMERICA
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NUMBER OF 7. SOLE VOTING POWER 0
SHARES ------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8. SHARED VOTING POWER (1)(2) 1,587,017
OWNED BY ------------------------------------------------------------------------------------------------------------
EACH 9. SOLE DISPOSITIVE POWER 0
REPORTING ------------------------------------------------------------------------------------------------------------
PERSON WITH 10. SHARED DISPOSITIVE POWER (1)(2) 1,587,017
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11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON (1)(2) 1,587,017
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12. CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) X
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13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 25.2%*
* BASED ON THE NUMBER OF SHARES OF COMMON STOCK OF EQUITY MARKETING, INC. REPORTED AS BEING
OUTSTANDING ON FORM 10-K OF EQUITY MARKETING, INC. FOR THE YEAR ENDED DECEMBER 31, 1999
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14. TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
IN
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(1) Amount beneficially owned excludes 1,953 shares held by the
Equity Marketing, Inc. 401(k) Plan Trust, as to which Mr. Kurz disclaims
beneficial ownership. Mr. Kurz is a trustee of the Equity Marketing, Inc.
401(k) Plan Trust.
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(2) Mr. Kurz and Crown Acquisition Partners, LLC ("Crown") entered
into a Voting Agreement dated as of March 29, 2000 (the "Voting Agreement"),
described more fully in item 6 below, a copy of which is attached hereto as
Exhibit 99.1, pursuant to which, unless terminated earlier as set forth
therein, Mr. Kurz agreed to vote all shares of Common Stock of Equity
Marketing, Inc. (the "Company") held by him (a) to approve the Securities
Purchase Agreement (as defined in item 6 below), and (b) in favor of the
designees of Crown for election to the board of directors of the Company.
Accordingly, Mr. Kurz may be deemed to be a "group" with Crown whereby Crown
would be deemed to have shared voting power over the shares of Common Stock
beneficially owned by Mr. Kurz. Mr. Kurz does not possess any voting or
dispositive power with respect to the shares of Common Stock owned by Crown.
In addition, Mr. Kurz granted an irrevocable proxy to Crown to vote the
shares of Common Stock he is entitled to vote in accordance with (a) and (b)
above. The Voting Agreement, unless terminated earlier as set forth therein,
also prevents Mr. Kurz from disposing of any shares before the earlier to
occur of the second closing under the Securities Purchase Agreement or the
record date of the meeting of stockholders of the Company held to vote on the
Crown transaction, provided that Mr. Kurz may sell up to 100,000 shares of
Common Stock if the transferee agrees to be bound by the terms of the Voting
Agreement and executes a counterpart to that effect. Accordingly, Crown may
also be deemed to have shared dispositive power over the shares of Common
Stock beneficially owned by Mr. Kurz.
Mr. Kurz expressly disclaims beneficial ownership of any shares of
Common Stock except 1,587,017 shares with respect to which he possesses
voting and dispositive power.
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ITEM 1.
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(A) NAME OF ISSUER:
EQUITY MARKETING, INC., A DELAWARE CORPORATION
(B) ADDRESS OF PRINCIPAL EXECUTIVE OFFICES OF THE ISSUER:
6330 SAN VICENTE BOULEVARD, LOS ANGELES, CA 90048
(C) TITLE OF CLASS OF EQUITY SECURITIES:
COMMON STOCK, $.001 PAR VALUE PER SHARE
ITEM 2.
(A) NAME OF PERSON FILING:
DONALD A. KURZ
(B) ADDRESS OF PRINCIPAL BUSINESS OFFICE OR, IF NONE, RESIDENCE:
C/O EQUITY MARKETING, INC.
6330 SAN VICENTE BOULEVARD
LOS ANGELES, CA 90048
(C) OCCUPATION:
OFFICER AND DIRECTOR OF EQUITY MARKETING, INC.
(D) CONVICTIONS:
NOT APPLICABLE
(E) CIVIL PROCEEDINGS REGARDING SECURITIES LAWS VIOLATIONS:
NOT APPLICABLE
(F) CITIZENSHIP:
UNITED STATES OF AMERICA
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ITEM 3. NOT APPLICABLE
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ITEM 4. NOT APPLICABLE
ITEM 5.
(A) AMOUNT BENEFICIALLY OWNED BY THE REPORTING PERSON: (1)(2) 1,587,017
-------------------------------------------------
(B) PERCENT OF CLASS: 25.2%
(C) NUMBER OF SHARES AS TO WHICH THE REPORTING PERSON HAS:
(I) SOLE POWER TO VOTE OR TO DIRECT THE VOTE 0
(II) SHARED POWER TO VOTE OR TO DIRECT THE VOTE (1)(2) 1,587,017
(III) SOLE POWER TO DISPOSE OR TO DIRECT THE DISPOSITION OF 0
(IV) SHARED POWER TO DISPOSE OR TO DIRECT THE DISPOSITION OF (1)(2) 1,587,017
(1) SEE ITEM 6.
(2) INCLUDES 44,167 SHARES ISSUABLE WITHIN 60 DAYS OF
MARCH 21, 2000 UPON EXERCISE OF OPTIONS TO PURCHASE
COMMON STOCK OF THE COMPANY.
</TABLE>
ITEM 6.
EQUITY MARKETING, INC. 401(K) PLAN TRUST. Amount beneficially owned
excludes 1,953 shares held by the Equity Marketing, Inc. 401(k) Plan Trust,
as to which Donald A. Kurz disclaims beneficial ownership. Mr. Kurz is a
trustee of the Equity Marketing, Inc. 401(k) Plan Trust.
VOTING AGREEMENT. Pursuant to a Securities Purchase Agreement, dated
as of March 29, 2000 (the "Securities Purchase Agreement"), between the
Company and Crown Acquisition Partners, LLC ("Crown"), Crown has agreed to
purchase from the Company, and the Company has agreed to sell to Crown, (i)
25,000 shares of Series A preferred stock, (ii) warrants to purchase 12,000
shares of Series B preferred stock, and (iii) warrants to purchase 3,000
shares of Series C preferred stock. As an inducement to Crown to enter into
the Securities Purchase Agreement, a Voting Agreement, dated as of March 29,
2000 (the "Voting Agreement"), was entered into between Crown and Mr. Kurz.
Pursuant to the terms of the Voting Agreement, unless terminated
earlier as set forth therein, Mr. Kurz irrevocably and unconditionally agreed
to vote all shares of Common Stock that he is entitled to vote in favor of
the Securities Purchase Agreement, and the transactions contemplated thereby,
and against any action which would reasonably be expected to result in a
failure of the conditions to the consummation of such transactions. Mr. Kurz
also irrevocably and unconditionally agreed to vote all
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shares of Common Stock that he is entitled to vote in favor of Crown's
designees for the board of directors of the Company for election as directors
at any meeting of the Company's stockholders called for such purpose. Mr.
Kurz also granted a proxy to Crown and appointed Crown as his
attorney-in-fact and proxy, with full power of substitution, for and in the
his name, to vote, express, consent or dissent, or otherwise to utilize such
voting power solely in the manner contemplated by the Voting Agreement.
Under the Voting Agreement, unless terminated earlier as set forth
therein, Mr. Kurz also agreed not to sell or otherwise dispose of any shares
of Common Stock held by him prior to the earlier to occur of the second
closing under the Securities Purchase Agreement or the record date of the
next meeting of stockholders called to approve the Securities Purchase
Agreement, provided that Mr. Kurz may sell up to 100,000 shares of Common
Stock so long as the transferee agrees to be bound by the terms of the Voting
Agreement and executes a counterpart to such effect.
The Voting Agreement will terminate upon Crown ceasing to have the
right to designate a nominee to the Board of Directors pursuant to the
Securities Purchase Agreement. In addition, the Voting Agreement will
terminate at such time as Mr. Kurz ceases to beneficially own any shares of
Common Stock (other than as a result of a disposition of such shares in
violation of the Voting Agreement) or, if Crown is permitted to vote any
shares of capital stock held by it as a single class with holders of Common
Stock for the election of directors, Crown fails to vote such shares for Mr.
Kurz for election as a director at any meeting of the Company's stockholders.
A copy of the Voting Agreement is filed herewith as Exhibit 99.1 and
is incorporated herein in its entirety. The foregoing descriptions of the
terms and provisions of the Voting Agreement are qualified in their entirety
by reference to the Voting Agreement.
ITEM 7.
EXHIBIT 99.1. Voting Agreement, dated as of March 29, 2000, by and
among Crown Acquisition Partners, LLC, a Delaware limited liability company,
and Donald A. Kurz.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: April 6, 2000
/s/ Donald A. Kurz
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Donald A. Kurz
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EXHIBIT INDEX
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Exhibit No. Description
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EXHIBIT 99.1 Voting Agreement, dated as of March 29, 2000, by and among Crown
Acquisition Partners, LLC, a Delaware limited liability company, and
Donald A. Kurz.
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EXHIBIT 99.1
VOTING AND IRREVOCABLE PROXY AGREEMENT
This VOTING AGREEMENT (the "Voting Agreement"), is dated as of
March 29, 2000 among Crown Acquisition Partners, LLC, a Delaware limited
liability company ("Investor") and Donald A. Kurz (the "Stockholder").
WHEREAS, in order to induce Investor to enter into the
Securities Purchase Agreement, dated as of the date hereof (the "Securities
Purchase Agreement"), with Equity Marketing, Inc., a Delaware corporation (the
"Company"), Investor has requested the Stockholder, and the Stockholder has
agreed, to enter into this Agreement with respect to shares of common stock of
the Company, par value $.001 per share (the "Common Stock") that the Stockholder
beneficially owns, whether now or hereafter acquired (the "Shares").
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE 1
GRANT OF PROXY; VOTING AGREEMENT; TRANSFER
Section 1.1 AGREEMENT TO VOTE FOR SECURITIES PURCHASE AGREEMENT.
The Stockholder hereby irrevocably and unconditionally agrees to vote all
Shares that the Stockholder is entitled to vote, at the time of any vote to
approve the Securities Purchase Agreement and the transactions contemplated
thereby (including the issuance of the Additional Securities (as defined in
the Securities Purchase Agreement)) at any meeting of the stockholders of the
Company (if one is held), and at any adjournment or postponement thereof, at
which the Securities Purchase Agreement (or any amended version thereof to
which the Stockholder consents) is submitted for the consideration and vote
of the stockholders of the Company (or in connection with any consent
solicitation conducted for such purpose), in favor of the approval of the
Securities Purchase Agreement and the transactions contemplated by the
Securities Purchase Agreement (including the issuance of the Additional
Securities) and against any action which would reasonably be expected to
result in a failure of the conditions described in Sections 6.3 and 6.4 of
the Securities Purchase Agreement to be satisfied.
Section 1.2 AGREEMENT TO VOTE FOR NOMINEES. The Stockholder hereby
irrevocably and unconditionally agrees to vote all Shares that the
Stockholder is entitled to vote and/or to cause such Shares to be voted in
favor of the Designees (as defined in the Securities Purchase Agreement) of
Investor nominated by the Company (or, if the Company fails to nominate such
Designees, which Investor is entitled to have nominated by the Company
pursuant to the Securities Purchase Agreement) for election as directors at
any meeting of the Company's stockholders called, or any consent solicitation
conducted, for such purpose.
Section 1.3 IRREVOCABLE PROXY. The Stockholder hereby revokes any and
all previous proxies granted with respect to the Shares that are inconsistent
with the voting agreements set forth in Sections 1.1 and 1.2. By entering into
this Agreement, the Stockholder hereby grants a proxy, effective upon the First
Closing under the Securities Purchase Agreement, appointing Investor as the
Stockholder's attorney-in-fact and proxy, with full power of substitution, for
and in the Stockholder's name, to vote, express, consent or dissent, or
otherwise to utilize such voting power solely in the manner contemplated by and
regarding the proposals specifically
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described in Sections 1.1 and 1.2 above. The proxy granted by the Stockholder
pursuant to this Article 1 is irrevocable and is coupled with an interest and
is granted in consideration of Investor entering into this Agreement and the
Securities Purchase Agreement and as security for the obligations of the
Stockholder under Section 1.2. The proxy granted by the Stockholder shall
terminate upon termination of this Agreement in accordance with its terms or,
with respect to particular Shares, the sale of such Shares in accordance with
the terms hereof. Without limiting the foregoing, the Stockholder will, upon
Investor's request, take all action as shall be reasonably required from time
to time in order to appoint Investor as its duly authorized proxy holder for
the Shares solely for the purpose set forth in Section 1.2. Such appointment
shall be renewed upon Investor's request as appropriate by the Stockholder
during the term of this Agreement in order to ensure that Investor remains
the duly authorized proxy holder of the Stockholder at all times during such
term solely for the purpose set forth in Section 1.2.
Section 1.4 NO PROXIES FOR OR DISPOSITIONS OF SHARES. Except
pursuant to the terms of this Agreement, the Stockholder shall not, without
the prior written consent of Investor, directly or indirectly, (i) grant any
proxies or enter into any voting trust or other agreement or arrangement with
respect to the voting of any Shares that are inconsistent with the voting
agreements set forth in Sections 1.1 and 1.2 or (ii) prior to the earlier to
occur of the Second Closing or the record date for the Company Stockholder
Meeting (as defined in the Securities Purchase Agreement) (the "No Sale
Date"), sell, assign, transfer, encumber or otherwise dispose of
(collectively "Sell," correlative terms to have correlative meanings), or
enter into any contract, option or other arrangement or understanding with
respect to the direct or indirect sale of any Shares. Notwithstanding
anything in Section 1.4(i) or (ii) to the contrary, the Stockholder may sell
up to 100,000 Shares at any time, whether before or after the No Sale Date so
long as the recipient agrees to be bound by the terms of this Agreement,
executes a counterpart to such effect and Investor receives such executed
Voting Agreement and proxy in the form hereof. The Stockholder agrees not to
permit any such transfer unless the Stockholder has complied with the
foregoing requirements.
Section 1.5 RECORD OWNER. If the Stockholder is not the record
owner of any Shares as to which the Stockholder is the beneficial owner, the
Stockholder agrees to cause or direct the record holder to vote such Shares
in accordance with the terms of this Agreement or, to the extent permitted by
law, to provide a proxy to Investor with respect thereto.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF STOCKHOLDERS
The Stockholder represents and warrants to Investor that:
Section 2.1 AUTHORIZATION. The execution, delivery and performance
by the Stockholder of this Agreement and the consummation by the Stockholder
of the transactions contemplated hereby are within the powers of the
Stockholder and such execution, delivery and performance have been duly
authorized by all necessary action of such entity and the individual signing
this Agreement on behalf of the Stockholder represents he is authorized to
bind the entity thereby. This Agreement constitutes a valid and binding
Agreement of the Stockholder, enforceable in accordance with its terms,
subject to the effect of applicable bankruptcy,
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insolvency, reorganization, moratorium and other similar laws affecting the
rights of creditors generally and the effect of general principles of equity.
Section 2.2 NON-CONTRAVENTION. The execution, delivery and
performance by the Stockholder of this Agreement and the consummation of the
transactions contemplated hereby do not and will not, (i) violate any
applicable law, rule, regulation, judgment, injunction, order or decree, (ii)
except as set forth in Section 3.2(d) of the Securities Purchase Agreement,
require any consent or other action by any person or private or governmental
entity under, constitute a breach of or default under, or give rise to any
right of termination, cancellation or acceleration or to a loss of any
benefit to which the Stockholder is entitled under any provision of any
agreement or other instrument binding on the Stockholder or (iii) result in
the imposition of any lien or encumbrance on any asset of the Stockholder.
Section 2.3 OWNERSHIP OF SHARES. Subject to community property laws
where applicable, the Stockholder is the sole beneficial owner of the Shares
set forth under the Stockholder's name on the signature page hereto, free and
clear of any lien or encumbrance (including any restriction on the right to
vote or otherwise dispose of the Shares). None of such Shares is subject to
any voting trust, proxy or other agreement or arrangement with respect to the
voting of such Shares.
Section 2.4 TOTAL SHARES. Except for the Shares set forth under the
Stockholder's name on the signature page hereto, the Stockholder does not
beneficially own any (i) shares of capital stock or voting securities of the
Company, (ii) securities of the Company convertible into or exchangeable for
shares of capital stock or voting securities of the Company or (iii) options
or other rights to acquire from the Company any capital stock, voting
securities or securities convertible into or exchangeable for capital stock
or voting securities of the Company, other than options granted under the
Company's stock option plans.
Section 2.5 FINDER'S FEES. No investment banker, broker, finder or
other intermediary is entitled to a fee or commission from the Stockholder,
Investor or the Company in respect of this Agreement based upon any
arrangement or agreement made by or on behalf of the Stockholder or the
Company.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF INVESTOR
Investor represents and warrants to the Stockholder:
Section 3.1 CORPORATE AUTHORIZATION. The execution, delivery and
performance by Investor of this Agreement and the consummation by Investor of
the transactions contemplated hereby are within the limited partnership
powers of Investor and have been duly authorized by all necessary limited
partnership action. This Agreement constitutes a valid and binding Agreement
of Investor, enforceable in accordance with its terms, subject to the effect
of applicable bankruptcy, insolvency, reorganization, moratorium and other
similar laws affecting the rights of creditors generally and the effect of
general principles of equity.
Section 3.2 NON-CONTRAVENTION. The execution, delivery and
performance by Investor of this Agreement and the consummation of the
transactions contemplated hereby do not and will
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not, (i) violate any applicable law, rule, regulation, judgment, injunction,
order or decree, (ii) except as set forth in Section 3.3(b) of the Securities
Purchase Agreement, require any consent or other action by any person or private
or governmental entity under, constitute a breach of or default under, or give
rise to any right of termination, cancellation or acceleration or to a loss of
any benefit to which Investor is entitled under any provision of any agreement
or other instrument binding on Investor or (iii) result in the imposition of any
lien or encumbrance on any asset of Investor.
Section 3.3 FINDER'S FEES. No investment banker, broker, finder or
other intermediary is entitled to a fee or commission from the Stockholder or
the Company in respect of this Agreement based upon any arrangement or
agreement made by or on behalf of Investor.
ARTICLE 4
MISCELLANEOUS
Section 4.1 FURTHER ASSURANCES. Investor and the Stockholder will
execute and deliver, or cause to be executed and delivered, all further
documents and instruments and use all reasonable efforts to take, or cause to
be taken, all actions and to do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations, to vote the
Stockholder's Shares to approve the Securities Purchase Agreement and the
transactions contemplated thereby (including the issuance of the Additional
Securities) and to take all other acts required to be taken by Investor or
the Stockholder pursuant to this Agreement; provided, however, that this
Section 4.1 shall not obligate the Stockholder to act in any capacity other
than as a stockholder of the Company, including, but not limited to, as an
officer, consultant or director of the Company.
Section 4.2 AMENDMENTS; TERMINATION. Any provision of this
Agreement may be amended or waived if, but only if, such amendment or waiver
is in writing and is signed, in the case of an amendment, by each party to
this Agreement or in the case of a waiver, by the party against whom the
waiver is to be effective. This Agreement shall terminate upon Investor
ceasing to have the exclusive right to designate a director under Section 4.4
of the Securities Purchase Agreement (assuming directors are not elected by
holders of the Preferred Stock, voting as a separate class, pursuant to the
Certificate of Designation). In addition, this Agreement will terminate at
such time as (i) the Stockholder ceases to beneficially own any Shares (other
than as a result of a disposition of such Shares in violation of this
Agreement) or (ii) if Investor is permitted to vote any shares of capital
stock held by it as a single class with holders of Common Stock for the
election of directors pursuant to paragraph 6 of the Certificate of
Designation (any such shares that may be voted as a single class with the
Common Stock, the "Eligible Shares"), Investor fails to vote such Eligible
Shares for the Stockholder for election as a director at any meeting of the
Company's stockholders (unless the Stockholder is not a nominee for director
at such meeting).
Section 4.3 NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed given upon receipt by the parties at
the following addresses (or at such other address for a party as shall be
specified by like notice):
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if to Investor, to: Crown Acquisition Partners, LLC
660 Madison Avenue, 15th Floor
New York, NY 10021
Attn: Kenneth Squire
Facsimile: (212) 207-8001
with a copy to: Latham & Watkins
633 West Fifth Street, Suite 4000
Los Angeles, California 90071-2007
Attn: W. Alex Voxman
Facsimile: (213) 891-8763
if to the Stockholder: Donald A. Kurz
c/o Equity Marketing, Inc.
6330 San Vicente Boulevard
Los Angeles, California 90048
Attn: Donald A. Kurz
Facsimile: (323) 932-4484
with a copy to: Equity Marketing, Inc.
6330 San Vicente Boulevard
Los Angeles, California 90048
Attn: Leland P. Smith
Facsimile: (323) 932-4488
and
Riordan & McKinzie
300 S. Grand Avenue, 29th Floor
Los Angeles, California 90071
Attn: Thomas M. Cleary, Esq.
Facsimile: (213) 229-8550
Section 4.4 EXPENSES. Except as provided in Section 9.5 of the
Securities Purchase Agreement, all costs and expenses incurred in connection
with this Agreement shall be paid by the party incurring such cost or expense.
Section 4.5 SUCCESSORS AND ASSIGNS; THIRD PARTY BENEFICIARIES. The
provisions of this Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and assigns; provided,
however, that no party may assign, delegate or otherwise transfer any of its
rights or obligations under this Agreement without the consent of the other
parties hereto. Notwithstanding anything contained in this Agreement to the
contrary, nothing in this Agreement, expressed or implied, is intended to
confer on any person other than the parties hereto or their respective
successors and assigns, any rights, remedies, obligations or liabilities
under or by reason of this Agreement, except that that the covenants made by
the Stockholder in Article 1 hereof shall also inure to the benefit of and be
enforceable by the Company (it being expressly understood, however, that such
Article may be amended by the
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parties, and compliance with any of the provisions of that Article may be
waived, in each case without the consent of or notice to the Company).
Section 4.6 GOVERNING LAW. This Agreement shall be construed in
accordance with and governed by the laws of the State of Delaware, without
regard for the conflicts of law principles thereof.
Section 4.7 COUNTERPARTS; EFFECTIVENESS. This Agreement may be
signed in any number of counterparts (which may be by facsimile), each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument. This Agreement shall become
effective when each party hereto shall have received counterparts hereof
signed by all of the other parties hereto.
Section 4.8 SEVERABILITY. If any term, provision or covenant of
this Agreement is held by a court of competent jurisdiction or other
authority to be invalid, void or unenforceable, and if the rights or
obligations of any party hereto under this Agreement will not be materially
and adversely affected thereby, (i) such provision will be fully severable,
(ii) this Agreement will be construed and enforced as if such invalid, void
or unenforceable provision had never comprised a part hereof, (iii) the
remaining provisions of this Agreement will remain in full force and effect
and will not be affected by the invalid, void or unenforceable provision or
by its severance herefrom and (iv) in lieu of such invalid, void or
unenforceable provision, there will be added automatically as a part of this
Agreement a legal, valid and enforceable provision as similar in terms to
such invalid, void or unenforceable provision as may be possible so as to
carry out the intent of the parties hereto to the maximum extent permitted by
law.
Section 4.9 NOTICE OF SALES. Through the date that is the earlier
to occur of the Second Closing and the record date of the Company Stockholder
Meeting, the Stockholder agrees to provide written notice to Investor of any
proposed sale of Shares by the Stockholder at least three business days prior
to such sale.
Section 4.10 LEGEND. The Stockholder agrees that the certificates
representing any of the Stockholder's Shares (other than those held in the
Company's 401(k) Plan) the sale of which is prohibited by Section 1.4 shall,
at the request of Investor, contain a legend to the effect that such Shares
are subject to the terms of this Agreement, which limits the ability of the
Stockholder to sell such Shares. In the event the Second Closing does not
occur on or prior to May 5, 2000, the Stockholder shall, if requested by
Investor, promptly deliver the Stockholder's certificates to the Company for
legending in accordance with this section. The parties agree to cooperate in
promptly removing the legend from any certificate that represents Shares that
are no longer subject to any sale restrictions.
Section 4.11 ENTIRE AGREEMENT. This Agreement, its exhibits and the
documents executed in connection herewith, constitute the entire agreement
between the parties hereto with respect to the subject matter hereof and
supersede all prior agreements and understandings, oral and written, between
the parties hereto with respect to the subject matter hereof.
Section 4.12 SPECIFIC PERFORMANCE. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement
is not performed in accordance with
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the terms hereof and that the parties shall be entitled to specific performance
of the terms hereof in addition to any other remedy to which they are entitled
at law or in equity.
(SIGNATURE PAGE FOLLOWS)
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
CROWN ACQUISITION PARTNERS, LLC
By: /s/ Jeffrey S. Deutschman
----------------------------
Name: Jeffrey S. Deutschman
Title: Manager
By: /s/ Donald A. Kurz
----------------------------
Name: Donald A. Kurz
with respect to 1,542,850 Shares held
directly and 1,953 Shares held in the
Equity Marketing, Inc. 401(k) Plan
