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EXHIBIT 5
LIGHTPOST PUBLISHING
MEDIA ARTS GROUP, INC.
November 15, 2000
Mr. Thomas Kinkade
521 Charcot Avenue
San Jose, CA 95131
RE: STANDSTILL AGREEMENT
Ladies and Gentlemen:
WHEREAS, Thomas Kinkade, Nanette Kinkade and/or an entity affiliated
with Thomas Kinkade (collectively, together with any other affiliates, "Bidder")
have proposed a transaction (Proposed Transaction") with Media Arts Group, Inc.
("MAG").
NOW THEREFORE, in consideration of the mutual promises set forth herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, MAG and each Bidder agree as follows:
1. Restricted Period. For a period ("Restricted Period") commencing
with the date of this letter agreement and ending thirty-days after the date
hereof, neither Bidder nor any of its Representatives shall, without the prior
written consent of the indepenedent committee of the board of directors of MAG
(consisting of Michael West and Herbert Montgomery):
(a) acquire, offer to acquire, or agree to acquire, directly or
indirectly, by purchase or otherwise, any Voting Securities or direct or
indirect rights to acquire any Voting Securities of MAG or any subsidiary of
MAG, or of any successor to or person in control of MAG, or any assets of MAG or
any subsidiary or division of MAG or of any such successor or controlling
person;
(b) make, or in any way participate, directly or indirectly, in
any "solicitation" of "proxies" to vote (as such terms are used in the rules of
the Securities and Exchange Commission ("SEC")), or seek to advise or influence
any person or entity with respect to the voting of any Voting Securities of MAG;
(c) make any public announcement with respect to, or submit a
proposal for, or offer of (with or without conditions) any extraordinary
transaction involving MAG or any of its securities or assets;
(d) form, join or in any way participate in a "group" as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), in connection with any of the foregoing;
(e) take any action that could reasonably be expected to require
MAG to make a public announcement regarding the possibility of any of the events
described in clauses (a) through (d) above; or
(f) request MAG or any of its Representatives, directly or
indirectly, to amend or waive any provision of this paragraph.
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November 14, 2000
Page 2
2. Definitions. For purposes of this letter agreement,
(i) "Representative" shall mean, as to any person, its directors, officers,
employees, agents, affiliates and advisors (including, without limitation,
financial advisors, attorneys and accountants) and debt financing sources and
their advisors, but specifically excluding equity financing sources or other
partners; (ii) "person" shall be broadly interpreted to include, without
limitation, any corporation, company, partnership, other entity or individual;
and (iii) "Voting Securities" shall mean at any time shares of any class of
capital stock of MAG which are then entitled to vote generally in the election
of directors; provided, that for purposes of this definition any securities
which at such time are convertible or exchangeable into or exercisable for
shares of common stock of such party shall be deemed to have been so converted,
exchanged or exercised.
3. Relief; Expenses; Waiver. Without prejudice to the rights and
remedies otherwise available hereunder, MAG shall be entitled to equitable
relief by way of injunction or otherwise if Bidder or any of its Representatives
breach or threaten to breach any of the provisions of this letter agreement. In
the event of litigation relating to this letter agreement, if a court of
competent jurisdiction determines in a final order from which there is no appeal
that this letter agreement has been breached by Bidder or by its
Representatives, will reimburse MAG for its costs and expenses (including,
without limitation, legal fees and expenses) incurred in connection with the
enforcement of this letter agreement and such litigation. It is further
understood and agreed that no failure or delay by MAG in exercising any right,
power or privilege hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any right, power or privilege of MAG hereunder.
4. Governing Law. This letter agreement shall be governed by and
construed in accordance with the laws of the State of Delaware, without giving
effect to its principles or rules regarding conflicts of laws, other than such
principles directing application of governing state law. Each party hereby
consents to the institution and resolution of any action or proceeding of any
kind or nature with respect to or arising out of this agreement brought by any
party hereto in the federal or state courts located within the State of
Delaware.
5. Entire Agreement. This letter agreement contains the entire
agreement between the parties hereto, and no modification of this letter
agreement or waiver of the terms and conditions hereof shall be binding upon
either party hereto, unless approved in writing by each such party.
Please confirm your agreement with the foregoing by signing and
returning to the undersigned the duplicate copy of this letter enclosed
herewith.
MEDIA ARTS GROUP, INC.
By: /s/ TIMOTHY S. GUSTER
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Name: Timothy S. Guster
Title: Sr. Vice President and
General Counsel
ACCEPTED AND AGREED as of
the date first written above:
By: /s/ THOMAS KINKADE
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Name: Thomas Kinkade
Thomas Kinkade
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