<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934
Date of Report (date of earliest event reported) June 10, 1997
DOVE ENTERTAINMENT, INC.
(Exact name of registrant as specified in its charter)
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<S> <C> <C>
California 0-24984 95-4015834
(State or other jurisdiction (Commission File Number) (IRS Employer Identification No.)
of incorporation)
</TABLE>
8955 Beverly Boulevard, Los Angeles, CA 90048
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (310) 786-1600
No Change
(Former name or former address, if changed since last report.)
<PAGE> 2
ITEM 1. Changes in Control of Registrant.
On June 10, 1997, Michael Viner and Deborah Raffin (together the
"Viners") entered into a securities purchase agreement with MEI (the "Purchase
Agreement") with Media Equities International, LLC, a New York limited liability
company ("MEI") pursuant to which MEI purchased 500,000 shares of Common Stock,
1,570 shares of the Registrant's Series C Preferred Stock, 214,113 shares of the
Registrant's Series D Preferred Stock and warrants to purchase 825,000 shares of
Common Stock from the Viners for total cash consideration of $3,086,000. As a
result, MEI beneficially owns 43% of the Registrant's Common Stock, giving pro
forma effect to the exercise of preferred stock and warrants to purchase Common
Stock which are currently convertible or exercisable. MEI owns 57% of the
Registrant's voting securities, giving effect to additional shares of preferred
stock which, although not currently convertible into Common Stock, grant MEI the
number of votes equal to the number of shares of Common Stock into which such
preferred shares is initially convertible without requiring MEI to convert such
shares.
Concurrently with the execution of the Purchase Agreement the Viners
entered into an employment termination agreement dated June 10, 1997 among the
Registrant and the Viners (the "Termination Agreement"), pursuant to which Mr.
Viner and Ms. Raffin resigned from all positions with the Registrant and its
subsidiaries, including as directors. Concurrently with such resignations, the
Registrant's Board of Directors appointed Terrence A. Elkes and Bruce Maggin,
two affiliates of MEI, to replace Mr. Viner and Ms. Raffin as directors, and
elected Ronald Lightstone as acting chief executive officer. In addition to
Messrs. Elkes and Maggin, three other members of the Registrant's nine member
Board of Directors are affiliated with MEI.
The Registrant, on the one hand, and Mr. Viner and Ms. Raffin, on the
other, have released and discharged one another for all claims of any kind that
one party may have against the other. In addition, Mr. Viner and Ms. Raffin have
agreed to consult with the Registrant on matters relating to their former
employment and not to compete with the Registrant in the audio book business nor
solicit authors or readers currently under contract with the Registrant or in
the Registrant's catalog (in each case for a period of four years), with certain
limited exceptions.
Pursuant to the Purchase Agreement, MEI has a right of first refusal on
any shares of Common Stock retained after the transaction by the Viners and
offered for sale or transfer by them for a period of three years. For the same
three year period, sales by Mr. Viner or Ms. Raffin in market transactions must
be limited during any three month period to the greater of (i) the volume
limitations of Rule 144 promulgated under the Securities Act of 1933, as
amended, and (ii) 150,000 shares of Common Stock.
Pursuant to the Termination Agreement, and in consideration for their
agreement to terminate their respective employment agreements, Mr. Viner and Ms.
Raffin will receive monthly payments (the "Payments") of approximately $14,583
and $10,416, respectively, and medical insurance for 60 months (the "Term") (the
remaining balance of the original term of the employment agreements). In
addition, Mr. Viner and Ms. Raffin will each receive a car allowance for 24
months and reimbursements for certain medical and business expenses.
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<PAGE> 3
To secure the Payments, the Registrant has issued into escrow 1,500 of
its Series E Preferred Stock (the "Shares"), convertible into shares of the
Common Stock to the extent set forth in the Certificate of Determination for the
Series E Preferred Stock (the "Certificate"). The Shares will be held in escrow
and will not be released to Mr. Viner and Ms. Raffin except in the event of a
default in the Payments by the Registrant (a "Default"). In the event of a
Default, Shares will be released to Mr. Viner or Ms. Raffin, as the case may be,
in an amount equal to the portion of the Payments unpaid due to such Default
divided by the stated value of the Series E Preferred Stock. Mr. Viner and Ms.
Raffin have registration rights pursuant to a registration rights agreement,
dated June 10, 1997, among the Registrant, Mr. Viner and Ms. Raffin (the
"Registration Rights Agreement") with respect to any Shares received by them
upon a Default.
The foregoing discussion is qualified in its entirety by reference to
(i) the Stock Purchase Agreement filed as Exhibit 10.40 to the Registrant's Form
10-KSB, filed April 14, 1997 and incorporated herein by reference, and (ii) the
Purchase Agreement, the Termination Agreement, the Registration Rights Agreement
and the Registrant's press release dated June 11, 1997, each of which is
attached hereto as an exhibit and incorporated herein by reference.
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ITEM 7. Financial Statements and Exhibits
c. Exhibits
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<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<S> <C>
4.19 Certificate of Determination of the Series E Preferred Stock of
Dove Entertainment, Inc. (the "Company").
4.20 Specimen Series E Preferred Stock Certificate of the Company.
4.21 Registration Rights Agreement, dated June 10, 1997, by and among
the Company, Michael Viner and Deborah Raffin.
10.45 Employment Termination Agreement, dated June 10, 1997, by and
among the Company, Michael Viner and Deborah Raffin.
10.46 Securities Purchase Agreement, dated June 10, 1997, by and among
MEI, Michael Viner and Deborah Raffin Viner.
99 Press release dated June 11, 1997.
</TABLE>
SIGNATURES
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.
DOVE ENTERTAINMENT, INC.
Date: June 24, 1997.
By: /s/ Ronald Lightstone
______________________________
Ronald Lightstone
Acting Chief Executive Officer
4
<PAGE> 1
EXHIBIT 4.19
CERTIFICATE OF DETERMINATION
OF THE SERIES E PREFERRED STOCK
OF
DOVE ENTERTAINMENT, INC.
We, Michael Viner and Deborah Raffin, certify that:
1. We are the President and Secretary, respectively, of Dove
Entertainment, Inc., a California corporation (the "Corporation").
2. The number of shares of Series E Preferred Stock is 1,500, none of
which has been issued.
3. The Board of Directors of the Corporation duly adopted the following
resolution:
WHEREAS, Article IV of the Articles of Incorporation of the
Corporation, as amended, authorizes the Preferred Stock of the Corporation to be
issued in series and authorizes the Board of Directors of the Corporation to
determine the rights, preferences, privileges and restrictions granted to or
imposed upon any wholly unissued series of Preferred Stock and to fix the number
of shares and designation of any such series;
NOW, THEREFORE, BE IT RESOLVED, that the Board of Directors of the
Corporation does hereby establish a series of Preferred Stock which shall be
designated Series E Preferred Stock, the maximum number of shares of which shall
be 1,500, which shall have the following rights, preferences, privileges and
restrictions:
1. Voting. Except as may be otherwise provided by law, holders of the
Series E Preferred Stock shall not have any voting rights.
2. Liquidation. Upon the dissolution and liquidation of the Corporation
and prior to the distribution of any assets of the Corporation to the holders of
all classes of Common Stock ("Common Stock") and any other class of stock
ranking junior to the Series E Preferred Stock, the assets remaining after the
payment of all debts and liabilities of the Corporation shall be distributed to
the holders of the Series E Preferred Stock, to the extent available, in an
amount equal to $1,000.00 per share of Series E Preferred Stock (the "Stated
Value"), but if the funds available therefor are insufficient, then to the
holders of Series E Preferred Stock (together with any other Preferred Stock
ranking equally in the event of liquidation with the Series E Preferred
1
<PAGE> 2
Stock) on a pro-rata basis. The Stated Value shall be paid to the holders of
Series E Preferred Stock before the holders of Common Stock and any other class
of stock ranking junior to the Series E Preferred Stock are entitled to receive
any payment or distribution of cash, securities or other property with respect
to such shares following the dissolution or liquidation of the Corporation.
Notwithstanding the foregoing, the amounts to which the holders of Series E
Preferred Stock shall be entitled shall be equitably adjusted to take account of
any stock splits, stock dividends, recapitalizations, reorganizations or other
transactions affecting the number of shares of Series E Preferred Stock
outstanding as a class.
The Series E Preferred Stock shall be junior to the Company's
Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock and
Series D Preferred Stock with respect to liquidation and dividends.
3. Conversion Rights. The holders of the Series E Preferred Stock shall
have conversion rights as follows (the "Conversion Rights"):
a. Conversion. The holders of Series E Preferred Stock shall
have the right to convert each of such shares at any time following the release
of such shares from escrow in accordance with the Escrow Agreement between the
Corporation and the initial holders of the Series E Preferred Stock of even date
herewith (the "Escrow Agreement") (provided that such date shall be no earlier
than six months after issuance) into such number of shares of Common Stock of
the Corporation (the "Conversion Shares") calculated by dividing $1,000.00 by
the then applicable Conversion Price. The Conversion Price shall be deemed to be
the average of the Closing Prices for the five (5) consecutive days upon which
the principal trading market for the Common Stock prior to the date such shares
of Series E Preferred Stock are released from escrow in accordance with the
Escrow Agreement. The Closing Price for any day shall be the average of the
reported closing bid and asked prices regular way on NASDAQ, or if the Common
Stock is listed or admitted to trading on a national securities exchange, the
last reported sales prices regular way, or if the Common Stock is quoted on the
NASDAQ National Market ("NNM"), the closing sale price, or if not so quoted, as
reasonably determined by the Board of Directors of the Corporation.
b. Mechanics of Conversion. Before any holder of Series E
Preferred Stock shall be entitled to receive certificates evidencing Conversion
Shares into which Series E Preferred Stock have been converted, such holder
shall surrender the certificate or certificates therefor, duly endorsed, at the
office of the Corporation or of any transfer agent for such stock, and shall
give written notice to the Corporation at such office that such holder wishes to
receive certificates evidencing the Conversion Shares and shall state therein
the name or names in which such holder wishes the certificate or certificates
for shares of Conversion Shares to be issued. The Corporation shall, as soon as
practicable thereafter, issue and deliver at such office to such holder of
Series E Preferred Stock, a certificate or certificates for the number of shares
of
2
<PAGE> 3
Conversion Shares to which such holder shall be entitled as aforesaid. The
person or persons entitled to receive the shares of Conversion Shares issuable
upon such conversion shall be treated for all purposes as the record holder or
holders of such shares of Conversion Shares on the date of conversion into such
Conversion Shares.
c. Reservation of Stock Issuable Upon Conversion. The
Corporation shall at all times reserve and keep available out of its authorized
but unissued shares of Common Stock, solely for the purpose of effecting the
conversion of the shares of Series E Preferred Stock, such number of its shares
of Common Stock as shall from time to time be sufficient to effect the
conversion of all outstanding shares of the Series E Preferred Stock, and if at
any time the number of authorized but unissued shares of Common Stock shall not
be sufficient to effect the conversion of all then outstanding shares of Series
E Preferred Stock, the Corporation will take such action as may, in the opinion
of its counsel, be necessary to increase its authorized but unissued shares of
Common Stock to such number of shares as shall be sufficient for such purpose.
4. Dividends. Except for payment of the Stated Value upon liquidation
of the Corporation and as otherwise required by law, the holders of Series E
Preferred Stock shall be not be entitled to receive any dividends in respect
thereof.
5. Redemption by the Corporation.
a. Right of Redemption. The Series E Preferred Stock may be
called for redemption and redeemed for cash at the option of the Corporation by
resolution of the Board of Directors, in whole or in part, at any time 30 days
after the expiration or termination of the Escrow Agreement (provided that at
such time the Common Stock underlying the Series E Preferred Stock may be
disposed of by each holder whose Series E Preferred Stock is called for
redemption pursuant to an effective registration statement or sold publicly
without registration under the Securities Act of 1933, as amended). In the case
of a partial redemption, the shares of Series E Preferred Stock to be so
redeemed shall be determined by the Board of Directors at its discretion.
b. Redemption Price. The redemption price per share of Series
E Preferred Stock to be paid upon a redemption under this Section 5 shall be
equal to eighty percent (80%) of the Stated Value thereof.
c. Redemption Notice. Notice of redemption of any shares of
Series E Preferred Stock pursuant to this Section 5 shall be given by the
Corporation by first-class mail, not less than 30 nor more than 60 days prior to
the date fixed by the Board of Directors of the Corporation for redemption, to
the holders of record of the Series E Preferred Stock at their respective
addresses than appearing on the records of the Corporation. The notice of the
redemption shall state: the redemption date, the redemption price, that on the
redemption date the redemption price will become due and payable upon each date
the redemption price will become
3
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due and payable upon each share of Series E Preferred Stock, and the place where
such shares of Preferred Stock to be redeemed are to be surrendered for payment
of the redemption price.
6. Protective Provisions. The Corporation shall not without first
obtaining the approval (by vote or written consent) of the holders of at least a
majority of the then outstanding shares of Series E Preferred Stock (voting as a
separate class):
a. alter or change the rights, preferences or privileges of
the shares of Series E Preferred Stock so as to affect adversely such shares;
b. amend its Articles of Incorporation in any respect so as to
adversely affect the shares of Series E Preferred Stock, except that the
Corporation may authorize and increase the number of authorized shares of Common
Stock; or
c. increase the number of authorized shares of Series E
Preferred Stock.
7. Effect of Acquisition of Preferred Stock by Corporation. All shares
of Series E Preferred Stock acquired by the Corporation by reason of redemption,
purchase or otherwise shall be canceled and cease to be outstanding and shall
have the status of authorized but unissued shares of undesignated preferred
stock.
[Signatures on the next page]
4
<PAGE> 5
We further declare under penalty of perjury under the laws of the State
of California that the matters set forth in this certificate are true and
correct of our own knowledge. Executed as of the 9th day of June, 1997 in Los
Angeles, California.
/s/ MICHAEL VINER
-----------------------------------------
Michael Viner
President
/s/ DEBORAH RAFFIN
-----------------------------------------
Deborah Raffin
Secretary
5
<PAGE> 1
EXHIBIT 4.20
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<S> <C> <C>
SERIES E PREFERRED THESE SECURITIES ARE RESTRICTED FROM SERIES E PREFERRED
TEMPORARY CERTIFICATE TRANSFER AS INDICATED ON REVERSE SIDE TEMPORARY CERTIFICATE
NO. TP 1 SHARES: 300
</TABLE>
THIS CERTIFICATE IS TRANSFERRABLE
IN THE CITY OF BEVERLY HILLS, CA
DOVE ENTERTAINMENT, INC.
INCORPORATED UNDER THE LAWS OF THE STATE OF CALIFORNIA
THIS CERTIFIES THAT
[SPECIMEN]
----------
IS THE OWNER OF
***THREE HUNDRED***
FULLY PAID AND NON-ASSESSABLE SHARES OF SERIES E PREFERRED STOCK, PAR VALUE
$0.01 PER SHARE, EACH OF WHICH ARE TRANSFERRABLE ON THE BOOKS OF THE CORPORATION
BY THE HOLDER HEREOF IN PERSON OR BY DULY AUTHORIZED ATTORNEY UPON SURRENDER OF
THIS CERTIFICATE PROPERLY ENDORSED.
THIS CERTIFICATE IS A TEMPORARY CERTIFICATE AND WILL BE REPLACED BY A PRINTED
CERTIFICATE AS SOON AS PRACTICABLE AFTER THE ISSUANCE HEREOF UPON THE SURRENDER
OF THE ORIGINAL VERSION OF THIS TEMPORARY CERTIFICATE.
IN WITNESS WHEREOF, THE SAID CORPORATION HAS CAUSED THIS CERTIFICATE TO BE
SIGNED BY ITS DULY AUTHORIZED OFFICERS AND ITS CORPORATE SEAL TO BE HEREUNTO
AFFIXED THIS 10TH DAY OF JUNE OF 1997.
/s/ DEBORAH RAFFIN /s/ MICHAEL VINER
--------------------- ----------------------
SECRETARY PRESIDENT
<PAGE> 2
THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL OR
OTHER SPECIAL RIGHTS OF THESE SECURITIES, AND THE QUALIFICATIONS, LIMITATIONS OR
RESTRICTIONS OF SUCH PREFERENCES AND/OR RIGHTS ARE SET FORTH IN THE CERTIFICATE
OF DETERMINATION OF SERIES E PREFERRED STOCK. THE CORPORATION WILL FURNISH
WITHOUT CHARGE TO EACH SHAREHOLDER WHO SO REQUESTS, A COPY OF THE CERTIFICATE OF
DETERMINATION OF SERIES E PREFERRED STOCK.
FOR VALUE RECEIVED,_______ HEREBY SELL, ASSIGN AND TRANSFER UNTO
______________________________________________________________________________
(NAME AND ADDRESS OF TRANSFEREE SHOULD BE PRINTED OR TYPEWRITTEN)
_________________________________________________________________ SHARES
REPRESENTED BY THE WITHIN CERTIFICATE AND DO HEREBY IRREVOCABLY CONSTITUTE AND
APPOINT ATTORNEY TO TRANSFER THE SAID SHARES ON THE BOOKS OF THE
WITHIN NAMED CORPORATION WITH FULL POWER OF SUBSTITUTION IN THE PREMISES.
DATED:_____________________
___________________
SIGNATURE
SIGNATURE GUARANTEED:
BY:________________________________
THE SIGNATURES SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR
INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN
ASSOCIATIONS AND CREDIT UNIONS) WHICH HAS MEMBERSHIP IN AN
APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM PURSUANT TO
S.E.C. RULE
THESE SHARES ARE SUBJECT TO THE TERMS OF AN ESCROW AGREEMENT BETWEEN THE
COMPANY, MICHAEL VINER, DEBORAH RAFFIN AND U.S. TRUST COMPANY OF
CALIFORNIA, N.A., AS ESCROW AGENT.
NEITHER THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR
THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS THEREOF AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES OR BLUE
SKY LAWS.
<PAGE> 1
EXHIBIT 4.21
REGISTRATION RIGHTS AGREEMENT, by and among Dove Entertainment, Inc., a
California corporation (the "Company"), Michael Viner and Deborah Raffin
(collectively, the "Holder"). Capitalized terms used herein, if not otherwise
defined, shall have the meaning ascribed to them in the Escrow Agreement, dated
June __, 1997, by and between the Company and the Holder (the "Escrow
Agreement").
WHEREAS, pursuant to an Employee Termination Agreement between the
Company and the Holder (the "Termination Agreement"), the Company has agreed to
make certain payments to Holder for up to five years, and in connection
therewith, the Company has agreed to place in escrow 1,500 shares of its newly
issued Series E Preferred Stock, Stated Value $1,000 per share (the "Series E
Preferred Stock"), which Series E Preferred Stock will be convertible into
shares of Common Stock, par value $.01 per share of the Company as set forth in
the Certificate of Determination for the Series E Preferred Stock.
WHEREAS, a portion of the Series E Preferred Stock will be released
from escrow to the Holder upon the occurrence of a default by the Company of a
Payment Obligation under the Escrow Agreement.
WHEREAS, pursuant to the terms of and in order to induce the Holder to
enter into the Termination Agreement and the Escrow Agreement, the Company and
the Holder have agreed to enter into this Agreement;
WHEREAS, the shares of Common Stock issuable upon conversion of the
Series E Preferred Stock shall be hereinafter referred to as the "Registrable
Shares"; and
WHEREAS, it is intended by the Company and Holder that this Agreement
shall become effective immediately upon the deposit by the Company of the Series
E Preferred Stock into escrow.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein, the Company and the Holder agree as follows:
1. Form S-3 Demand Registration.
(a) Subject to the conditions of this Section 1, if the Company shall
receive a written request from the Holder that the Company effect a registration
on Form S-3 (or any successor to Form S-3) or any similar short-form
registration statement and any related qualification or compliance under
applicable securities and blue sky laws with respect to all or a part of the
Released Registrable Shares (as defined below) the Company will, as soon as
practicable, effect such registration and all such qualifications and
compliances as may be so requested and as would permit or facilitate the sale
and distribution of all or such portion of the Released Registrable Shares as
are specified in such request, provided, however, that the Company shall
1
<PAGE> 2
not be obligated to effect any such registration, qualification or compliance
pursuant to this Section 1:
(i) if Form S-3 (or any successor or similar form) is not
available for such offering by the Holder; or
(ii) if the Company shall furnish to the Holder a
certificate signed by the Chairman of the Board of
Directors of the Company stating that in the good
faith judgment of the Board of Directors of the
Company, it would be detrimental to the Company and
its shareholders for such Form S-3 registration to be
effected at such time, in which event the Company
shall have the right to defer the filing of the Form
S-3 registration statement for a period of not more
than one hundred eighty (180) days after receipt by
the Company of the request of the Holder under this
Section 1; or
(iii) if the Company shall have previously filed a
registration on Form S-3 at the request of the Holder
with respect to the same Released Registrable Shares
or a registration statement covering the Released
Registrable Shares shall have previously been
declared effective or is being reviewed by the SEC;
or
(iv) in any jurisdiction in which the Company would be
required in connection therewith or as a condition
thereto to qualify to do business or to execute or to
file a general consent to service of process in
effecting such registration, qualification or
compliance.
"Released Registrable Shares" means those Registrable Shares released
from escrow (and, if the Registrable Shares have not yet been issued, the
Registrable Shares issuable upon conversion of the Series E Preferred Stock
released from escrow) due to the occurrence of a default by the Company of a
Payment Obligation under the Escrow Agreement. No shares need be registered
pursuant to this Agreement unless such shares are Released Registrable Shares.
(b) Holder's registration rights under this Section 1 shall expire if
all Registrable Shares have become Released Registrable Shares and all Released
Registrable Shares still held by the Holder may be sold under Rule 144 during
any one hundred eighty (180) day period.
2. Piggyback Registration. The Company shall notify the Holder no later
than twenty (20) days prior to the filing of any registration statement under
the Securities Act for purposes of any public offering of Common Stock by the
Company, on Form S-3 or any other available form, initiated by the Company (but
excluding registration statements relating to employee benefit plans or
arrangements or with respect to any reclassifications, reorganizations, business
combinations, acquisitions or other similar transactions or transactions
described in Rule 145 promulgated under the Securities Act or any registration
statement on a Form S-8 or S-
2
<PAGE> 3
4 or any similar form which may be promulgated in the future) and will afford
Holder an opportunity to include in such registration statement all or part of
the Released Registrable Shares. If Holder desires to include in any such
registration statement all or any part of the Released Registrable Shares,
Holder shall, within ten (10) days after the date of the above-described notice
from the Company, so notify the Company in writing. Such notice shall state the
intended method of disposition of such Released Registrable Shares. If Holder
decides not to include all of the Released Registrable Shares in any
registration statement thereafter filed by the Company, Holder shall
nevertheless continue to have the right to include the Released Registrable
Shares in any subsequent registration statement or registration statements as
may be filed by the Company with respect to offerings of its Common Stock, all
upon the terms and conditions set forth herein.
(a) Underwriting. If the registration statement under which the Company
gives notice under this Section 2 is for an underwritten offering, the Company
shall so advise the Holder. In such event, the right of the Holder to be
included in a registration pursuant to this Section 2 shall be conditioned upon
the Holder's participation in such underwriting and the inclusion of the
Released Registrable Shares in the underwriting to the extent provided herein.
In addition, the inclusion of the Released Registrable Shares may be further
conditioned upon the Holder agreeing to a lock-up of such Released Registrable
Shares for a period not to exceed 180 days. If Holder participates in such
underwriting, Holder shall enter into an underwriting agreement in customary
form with the underwriter or underwriters selected for such underwriting by the
Company and perform its obligations under such agreement. Notwithstanding any
other provision of the Agreement, if the underwriter determines in good faith
that marketing factors require a limitation of the number of Released
Registrable Shares to be underwritten, the number of shares of Common Stock that
may be included in the underwriting shall be allocated first to the Company,
then to any other holder of Common Stock exercising a demand registration as to
the registration statement in question, and then, to the extent any Released
Registrable Shares are to be included in such offering, to the Holder. No such
reduction shall reduce the securities being offered by the Company for its own
account to be included in the registration and underwriting.
(b) Right to Terminate Registration. The Company shall have the right
to terminate or withdraw any registration initiated by it under this Section 2
prior to the effectiveness of such registration whether or not the Holder has
elected to include securities in such registration. The Registration Expenses
(as defined below) of such withdrawn registration shall be borne by the Company
in accordance with Section 4 hereof.
(c) Expiration. Holder's registration rights under this Section 2 shall
expire (i) if all Registrable Shares have been previously sold by the Holder, or
(ii) if all Registrable Shares have become Released Registrable Shares and (A)
all Released Registrable Shares still held by the Holder may be sold under Rule
144 without regard to the volume limitations set forth therein or (B) if one or
more registration statements covering all Registrable Shares shall have
previously been declared effective or is being reviewed by the SEC.
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<PAGE> 4
3. Expenses of Registration. Except as specifically provided herein,
all Registration Expenses (as defined below) incurred in connection with any
registration under Sections 1 or 2 shall be borne by the Company. All Selling
Expenses (as defined below) incurred in connection with any registrations
hereunder shall be borne by the Holder. The Company shall not, however, be
required to pay for expenses of any registration proceeding, including, without
limitation, Registration Expenses, begun pursuant to Section 1, the request of
which has been subsequently withdrawn by the Holder unless the withdrawal is
based upon material adverse information concerning the Company of which the
Holder was not aware, or deemed to be aware of, at the time of such request. As
used herein, "Registration Expenses" means all expenses incurred by the Company
in complying with Sections 1 or 2 including, without limitation, all
registration and filing fees, printing expenses, fees and disbursements of
counsel for the Company, blue sky fees and expenses and the expense of any
special audits incident to or required by any such registration (but excluding
the compensation of regular employees of the Company which shall be paid in any
event by the Company), and "Selling Expenses" means all underwriting discounts
and selling commissions applicable to the sale of Registrable Shares and the
fees and disbursements of all advisors, including, without limitation, counsel
and accountants, of the Holder.
4. Obligations of the Company. Whenever required to effect the
registration of any Released Registrable Shares, the Company shall, as
expeditiously as reasonably possible:
(a) Prepare and file with the SEC a registration statement with respect
to such Released Registrable Shares within forty five (45) days and use all
reasonable efforts to cause such registration statement to become effective and,
upon the request of the Holder, keep such registration statement effective for
up to one hundred eighty (180) days or, if earlier, until the Holder has
completed the distribution related thereto.
(b) Prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of all Released Registrable
Shares covered by such registration statement.
(c) Furnish to the Holder such reasonable number of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as Holder may
reasonably request in order to facilitate the disposition of Released
Registrable Shares owned by Holder in accordance with the registration
statement.
(d) Use its reasonable efforts to register and qualify the securities
covered by such registration statement under such other securities or blue sky
laws of such jurisdictions as shall be reasonably requested by the Holder,
provided that the Company shall not be required in connection therewith or as a
condition thereto to qualify to do business or to execute or to file a general
consent to service of process in any such states or jurisdictions.
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(e) In the event of any underwritten public offering, enter into and
perform its obligations under an underwriting agreement, in usual and customary
form, with the managing underwriter(s) of such offering. Holder shall also enter
into and perform its obligations under such an agreement.
(f) Notify Holder at any time when a prospectus relating thereto is
required to be delivered under the Securities Act of the happening of any event
as a result of which the prospectus included in such 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 not misleading in the light of the circumstances then
existing.
(g) Prior to the effective date of any registration statement covering
Released Registrable Shares, use its reasonable efforts to provide a CUSIP
number for the Released Registrable Shares.
(h) Use its reasonable efforts to cause the Released Registrable
Securities to be (i) listed on each securities exchange, if any, on which
securities of the Company are then listed or (ii) authorized to be quoted on the
NASDAQ SmallCap Market or the NASDAQ National Market if the securities so
qualify.
(i) Maintain a transfer agent and registrar for the Company's Common
Stock.
5. Delay of Registration. Furnishing Information. Holder shall not have
any right to obtain or seek an injunction restraining or otherwise delaying any
registration as the result of any controversy that might arise with respect to
the interpretation or implementation of this Agreement. It shall be a condition
precedent to the obligations of the Company to take any action pursuant to
Sections 1 or 2 that the Holder shall furnish to the Company such information
regarding themselves, the Released Registrable Shares held by them and the
intended method of disposition of such securities, and any other information, as
shall be required by the Company to effect the registration of the Released
Registrable Shares.
6. Indemnification. In the event any Registrable Shares are included in
a registration statement under Sections 1 or 2:
(a) To the extent permitted by law, the Company will indemnify and hold
harmless Holder against any losses, claims, damages, or liabilities (joint or
several) to which they may become subject under the Securities Act, the Exchange
Act or other federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
of the following statements, omissions or violations (collectively, a
"Violation") by the Company: (a) any untrue statement or alleged untrue
statement of a material fact contained in such registration statement, including
any preliminary prospectus or final prospectus contained therein or any
amendments or supplements thereto, (b) the omission or alleged omission to state
therein a material fact required to be stated therein, or necessary to make the
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statements therein not misleading or (c) any violation or alleged violation by
the Company of the Securities Act, the Exchange Act, any state securities or
blue sky law or any rule or regulation promulgated under the Securities Act, the
Exchange Act or any state securities or blue sky law in connection with the
offering covered by such registration statement; and the Company will reimburse
Holder for any reasonable legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the indemnity agreement contained
in this Section shall not apply to amounts paid in settlement of any such loss,
claim, damage, liability or action if such settlement is effected without the
consent of the Company, which consent shall not be unreasonably withheld;
provided, further, however, that the Company shall not be liable in any such
case for any such loss, claim, damage, liability or action to the extent that it
arises out of or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration by Holder or an underwriter in an underwritten offering;
provided, further, however, that the Company will not be responsible for any
losses, claims, damages, liabilities or actions arising out of or based upon any
Violation which was corrected in a subsequent prospectus which was not timely
distributed to the person or entity which led to such loss, claim, damage,
liability or action.
(b) To the extent permitted by law, Holder will indemnify and hold
harmless the Company, each of its directors, officers and legal counsel and each
person, if any, who controls the Company within the meaning of the Securities
Act or the Exchange Act, any underwriter and any other holder selling securities
under such registration statement or any of such underwriter's or other holder's
partners, directors, officers, legal counsel or any person who controls such
underwriter or holder, against any losses, claims, damages or liabilities (joint
or several) to which the Company or any such director, officer, legal counsel,
controlling person, underwriter, other such holder, or partner, director,
officer, legal counsel or controlling person of such underwriter or other holder
may become subject under the Securities Act, the Exchange Act or other federal
or state law, insofar as such losses, claims, damages or liabilities (or actions
in respect thereto) arise out of or are based upon any Violation, in each case
to the extent (and only to the extent) that such Violation occurs in reliance
upon and in conformity with written information furnished by or on behalf of
Holder for use in connection with such registration; and Holder will reimburse
any reasonable legal or other expenses reasonably incurred by the Company or any
such director, officer, legal counsel, controlling person, underwriter or other
holder, or partner, officer, director, legal counsel or controlling person of
such underwriter or other holder in connection with investigating or defending
any such loss, claim, damage, liability or action; provided, however, that the
indemnity agreement contained in this Section shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder, which consent shall
not be unreasonably withheld; provided, further, however, that in no event shall
any indemnity under this Section exceed the gross proceeds from the offering
received or receivable by Holder.
(c) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action (including any governmental action),
such indemnified party will,
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if a claim in respect thereof is to be made against any indemnifying party under
this Section, deliver to the indemnifying party a written notice of the
commencement thereof and the indemnifying party shall have the right to
participate in, and, to the extent the indemnifying party so desires, jointly
with any other indemnifying party similarly noticed, to assume the defense
thereof with counsel reasonably satisfactory to the parties; provided, however,
that an indemnified party shall have the right to retain its own counsel, with
the fees and expenses to be paid by the indemnifying party, if representation of
such indemnified party by the counsel retained by the indemnifying party would
be inappropriate due to actual or probable potential differing interests between
such indemnified party and any other party represented by such counsel in such
proceeding. The failure to deliver written notice to the indemnifying party
within a reasonable time of the commencement of any such action, if materially
prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party under this Section,
but the omission so to deliver written notice to the indemnifying party will not
relieve it of any liability that it may have to any indemnified party otherwise
than under this Section.
(d) If the indemnification provided for in this Section is held by a
court of competent jurisdiction to be unavailable to an indemnified party with
respect to any losses, claims, damages or liabilities referred to herein, the
indemnifying party, in lieu of indemnifying such indemnified party thereunder,
shall to the extent permitted by applicable law contribute to the amount paid or
payable by such indemnified party as a result of such loss, claim, damage or
liability in such proportion as is appropriate to reflect the relative fault of
the indemnifying party, on the one hand, and of the indemnified party, on the
other hand, in connection with the Violations that resulted in such loss, claim,
damage or liability, as well as any other relevant equitable considerations. The
relative fault of the indemnifying party and of the indemnified party shall be
determined by a court of law by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission to state a
material fact relates to information supplied by the indemnifying party or by
the indemnified party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission;
provided, however, that in no event shall any contribution by Holder hereunder
exceed the gross proceeds from the offering received or receivable by Holder. No
person guilty of fraudulent misrepresentations (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
(e) The obligations of the Company and Holder under this Section shall
survive completion of any offering of Registrable Shares in a registration
statement. No indemnifying party, in the defense of any such claim or
litigation, shall, except with the consent of each indemnified party, consent to
entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release from all liability in respect to such claim or
litigation. In the event any offering of Registrable Shares is underwritten, and
the underwriting agreement provides for indemnification and/or contribution by
the Company and the Holder the indemnification and/or
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contribution obligations of the Company and the Holder hereunder shall in no
event exceed the obligations of the parties set forth in such underwriting
agreement.
7. Assignment of Registration Rights. The rights to cause the Company
to register Released Registrable Shares pursuant to this Agreement may not be
assigned by Holder without the prior written consent of the Company.
8. Amendment of Registration Rights. Any provision of this Agreement
may be 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 the Company and the Holder. Any amendment or waiver effected
in accordance with this Section shall be binding upon Holder and the Company. By
acceptance of any benefits under this Agreement, Holder hereby agrees to be
bound by the provisions hereunder.
9. Rule 144 Reporting. With a view to making available to the Holder
the benefits of certain rules and regulations of the SEC which may permit the
sale of the Released Registrable Shares to the public without registration, the
Company agrees to use its reasonable effort to: (a) make and keep public
information available, as those terms are understood and defined in SEC Rule 144
or any similar or analogous rule promulgated under the Securities Act, at all
times after the date hereof until all of the Released Registrable Shares have
been sold pursuant to an effective registration statement or are no longer
outstanding or all of the Common Stock are redeemed; (b) file with the SEC, in a
timely manner, all reports and other documents required of the Company under the
Exchange Act; and (c) so long as Holder owns any Released Registrable Shares,
furnish or make available to Holder forthwith upon request a written statement
by the Company as to its compliance with the reporting requirements of said Rule
144 of the Securities Act, and of the Exchange Act (at any time after it has
become subject to such reporting requirements), a copy of the most recent annual
or quarterly report of the Company and such other reports and documents as
Holder may reasonably request in availing itself of any rule or regulation of
the SEC allowing it to sell any such securities without registration.
10. Effectiveness of Registration Statement. The Company shall use its
best efforts to obtain the effectiveness of a registration statement within
ninety (90) days after the date such registration statement is filed.
11. Successors and Assigns. Except as otherwise expressly provided
herein, this Agreement shall inure to the benefit of and be binding upon the
successors and permitted assigns of the Company and the Holder.
12. Counterparts. One or more counterparts of this Agreement may be
signed by the parties, each of which shall be an original but all of which
together shall constitute one and same instrument.
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13. Governing Law. This Agreement shall be construed in accordance with
and governed by the internal laws of the State of California, without giving
effect to the conflicts of law principles thereof or the actual domicile of the
parties.
14. Invalidity of Provisions. If any provision of this agreement is or
becomes invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein shall not be
affected thereby.
15. Headings. The headings in this Agreement are for convenience of
reference only and shall not be deemed to alter or affect the meaning or
interpretation of any provisions hereof.
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IN WITNESS WHEREOF, the parties have executed this agreement as of the
___ day of June, 1997.
DOVE ENTERTAINMENT, INC.
By: /s/ STEVE SOLOWAY /s/ MICHAEL VINER
---------------------------- ----------------------------------
Steven Soloway Michael Viner
/s/ DEBORAH RAFFIN
----------------------------------
Deborah Raffin
[Registration Rights Agreement]
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EXHIBIT 10.45
EMPLOYMENT TERMINATION AGREEMENT
EMPLOYMENT TERMINATION AGREEMENT (the "Agreement") made as of June __,
1997 among Dove Entertainment, Inc., a California corporation (the "Company"),
Michael Viner ("Viner" or "Employee") and Deborah Raffin ("Raffin" or "Employee"
and, together with Viner, the "Employees").
WITNESSETH:
WHEREAS, Viner is the Chief Executive Officer and President of the
Company pursuant to an employment agreement dated January 1, 1995 and Raffin is
the Vice President and Secretary of the Company pursuant to an employment
agreement dated January 1, 1995 (collectively, the "Employment Agreements");
WHEREAS, the Company and Employees have agreed to terminate the
Employment Agreements, subject to the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the foregoing and the covenants,
agreements, representations and warranties herein contained, and intending to be
legally bound, the parties hereby mutually agree as follows:
AGREEMENT
ARTICLE 1
COVENANTS
1.1 Beginning on the date of this Agreement, the Company shall pay
Viner (the "Viner Payment Obligation") Fourteen Thousand Five Hundred
Eighty-Three Dollars and Thirty Three Cents ($14,583.33) per month for sixty
months (the "Term") (for an aggregate amount equal to Eight Hundred Seventy-Five
Thousand Dollars ($875,000.00)) and a monthly automobile allowance of One
Thousand Dollars ($1,000.000) per month for 24 months.
1.2 Beginning on the date of this Agreement, the Company shall pay
Raffin (the "Raffin Payment Obligation", and, together with the Viner Payment
Obligation, the Payment Obligations") Ten Thousand Four Hundred Sixteen Dollars
and Sixty Seven Cents ($10,416.67) per month during the Term (for an aggregate
amount equal to Six Hundred Twenty-Five Thousand Dollars ($625,000.00)) and a
monthly automobile allowance of One Thousand Dollars ($1,000.00) per month for
24 months.
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1.3 The Company shall maintain the SAG group medical insurance in place
on the date hereof during the Term for the benefit of the Employees.
1.4 The Company shall issue 1,500 shares of a new series of its
preferred stock ("Series E Preferred") pursuant to an Escrow Agreement of even
date herewith among the Company, Viner and Raffin and the escrow agent named
therein (the "Escrow Agreement"), substantially in the form of Exhibit A hereto.
As more fully described in the Escrow Agreement, in the event the Company
defaults with respect to either Payment Obligation, the Company shall cause the
escrow agent to issue to Viner and Raffin, or either of them, that number of
shares of Series E Preferred equal to the quotient of the amount of such
defaulted Payment Obligation divided by the stated value of the Series E
Preferred. The number of Series E Preferred shares in escrow shall be reduced at
the end of each 12 month period during the Term by the portion of the Payment
Obligation paid in such period. Viner and Raffin shall be entitled to
registration rights with respect to the Series E Preferred as set forth in a
registration rights agreement among the Company, Viner and Raffin (the
"Registration Rights Agreement"), substantially in the form of Exhibit B hereto.
Viner and Raffin acknowledge that the certificates representing the Series E
Preferred shall bear legends regarding the restrictions on transfer thereof
required by (1) the Securities Act of 1933 as amended (the "Act"), (2) this
Agreement and (3) the Escrow Agreement.
1.5 The Company will reimburse Viner and Raffin for actual medical
expenses incurred to date upon presentation of invoices for such expenses, to
the extent not covered by insurance, in an amount not to exceed Ten Thousand
Dollars ($10,000) in the aggregate.
1.6 The Company will reimburse Viner and Raffin for actual business
expenses incurred prior to the date of this Agreement and billed to him or her
personally (whether or not incurred by them).
1.7 The Company will hold the presently planned promotional events for
Erica Jong, Stephen Cannell and LaVyrie Spencer and agrees to spend up to an
aggregate of Ten Thousand Dollars ($10,000) for these events.
1.8 Viner and Raffin will not "compete" in any way, directly or
indirectly, in the audio book business for a period of four years, without the
prior written consent of the Company. For the purposes of this Agreement, the
term "compete" includes engaging in, assisting (financially or otherwise) or
performing services in connection with the audio book business, including,
without limitation, whether such engagement, assistance or performance is as an
officer, director, proprietor, employee, partner, stockholder or other investor
(other than as a holder of less than 5% of the outstanding capital stock of a
publicly traded corporation), creditor, guarantor, consultant, advisor, agent,
sales representative or other participant, in any county or any other political
subdivision of any state of the United States of America or any of its
possessions or territories where the Company conducted such businesses at any
time during the five year period preceding the date hereof. All of the parties
agree that the duration and area for
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which the covenant not to compete set forth in this Agreement is to be effective
are reasonable. In the event that any court determines that the time period or
the geographical areas provided for in this Agreement, or both of them, are
unreasonable and that such coverage is to the extent unenforceable, such
covenant shall be deemed to be a series of separate covenants, one for each and
every state of the United States of America and for any other territory or
possession of the United States of America where this covenant is intended to be
effective. The parties agree that damages would be an inadequate remedy for the
Company in the event of a breach or threatened breach of this covenant and thus,
in any such event, the Company may, either with or without pursuing any
potential damage remedies and in addition to such remedies, immediately obtain
and enforce an injunction, and/or a temporary restraining order, prohibiting
Viner or Raffin from violating this covenant, without having to prove actual
damages or post bond.
1.9 Viner and Raffin will reasonably consult with the Company during
the term of this Agreement on matters relating to their employment with the
Company. Viner and Raffin further will cooperate with the Company, and the
Company will cooperate with Viner and Raffin, on all litigation matters arising
prior to this Agreement or after the date of this Agreement on matters arising
during their employment with the Company. The Company will reimburse Viner and
Raffin for any actual and reasonable expenses approved in advance by the
Executive Committee of the Board of Directors of the Company incurred in
connection with the foregoing.
1.10 Viner and Raffin will not directly or indirectly contract with,
hire, solicit, encourage the departure of or in any manner engage or seek to
employ any author or, for purposes of audio books, reader, currently under
contract or included in the Company's book or audio catalogues for a period of
four years; provided that (i) nothing herein shall prevent Viner from acting as
agent for (A) any author or reader under contract to the Company or in the
Company's audio or book catalogs on the date hereof if Viner was acting as agent
for such author or reader on the date hereof, and (B) persons who are not
currently under contract or in the Company's book or audio catalogues, but he
may only act as agent to any such person for audio purposes if such
representation is ancillary to substantial representation by Viner for such
person in other areas, and (ii) after 24 months from the date hereof Viner and
Raffin shall be free to contract with any author or reader under contract with
the Company or in the Company's catalogs for books only; and provided further
that Viner may represent.
1.11 Viner and Raffin will not directly or indirectly hire, solicit,
encourage the resignation of, or in any manner seek to employ or engage any
Company employees, while employed by the Company, for a period of three years,
other than their current secretaries. Nothing herein shall prevent Viner and
Gerald Leider from working together on any film or television project provided
such project is not related to any Company project.
1.12 The Company will provide Viner and Raffin the office space,
parking and related facilities and equipment which he or she previously used at
the Canon facility until September 1, 1997. The Company will prepare such space,
including Viner's previous office with its existing washroom, and Viner will
occupy such space as soon as it is ready. Raffin shall occupy such
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space as of July 1, 1997. At the time each of Viner and Raffin occupies such
space, the Company will pay for moving all of their respective personal effects
to either such space or to such other space in the greater Los Angeles area as
each of Viner and Raffin may specify (or combination thereof). The Company will
provide and pay for the services of each of Viner's and Raffin's current
secretaries until September 1, 1997.
1.13 All of Viner's and Raffin's personal possessions, including
records, receipts, artwork and furniture, will be returned to Viner and Raffin,
provided that such possessions were not reimbursed by the Company nor recorded
on the books of the Company. Viner and Raffin shall each be permitted to retain
one mobile phone and one computer presently in their possession; provided that
all monthly and maintenance expenses related thereto shall be the obligation of
Viner and Raffin. Except as set forth in this paragraph, Viner and Raffin
represent and warrant to the Company that they do not have in their possession
any property of the Company included but not limited to masters, documents or
equipment.
1.14 Regarding the motion picture "Morning Glory", the parties will
negotiate their respective rights in good faith for a period of 30 days. If they
fail to reach agreement the parties agree to binding arbitration with an
arbitrator to be mutually agreed upon and failing to mutually agree, to be
selected by JAMS/Endispute, pursuant to the arbitration rules used by
JAMS/Endispute as set forth in Section 5.1 hereof.
1.15 The Company will pay Viner and Raffin the budgeted Producer and
Executive Producer fees on "Unwed Father" of $50,000 each ($12,500 each upon
completion of principal photography and $12,500 each upon delivery of the final
print), $25,000 of which they acknowledge has previously been paid to each of
them. Viner and Raffin agree that they will not be entitled to any other fees or
participations on existing or future projects, provided however they shall
receive shared Executive Producer credit on a sole front card for the television
movie "Future Sport" and Raffin shall receive Producer credit on each audio work
initiated during her employment with the Company in accordance with normal
practice.
1.16 The Company will not permit the amendment of its constituent
documents so as to terminate or reduce its obligations to indemnify either Viner
or Raffin, or change its Directors' and Officers' insurance to reduce or
eliminate coverage of Viner or Raffin for acts or omissions prior to the date
hereof.
1.17 The Company will provide Viner and Raffin with ten copies of each
book and audio tape, and two VHS copies of each television movie or feature
film, published or produced by the Company after the date of this Agreement but
ordered into production during their tenure with the Company.
1.18 The Company hereby relinquishes any rights it may have in and to
"The Incredible Bongo Band", "George Burns" and "Jimmy Smith" to Viner and
Raffin, and will return to them all master and inventory copies.
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1.19 The Company will deliver one box of doggy bones to Viner and
Raffin per month during Term, it being understood and acknowledged that this
provision shall inure solely for the benefit of "Crillon" and "Petunia".
1.20 The parties will not issue any press releases regarding this
Agreement without mutual approval, provided nothing herein shall restrict the
Company from complying with its securities law obligations.
ARTICLE 2
RELEASES
2.1 Subject to the other terms and conditions set forth herein, Viner
and Raffin hereby resign from any and all positions he and she have with the
Company and its subsidiaries effective immediately. The Company and the
Employees hereby agree to the termination of the Employment Agreements effective
immediately.
2.2 (a) Each of Viner and Raffin hereby release and discharge the
Company and each of its subsidiaries, controlling persons, affiliates,
successors and assigns from all actions, causes of action, suits, debts, dues,
sums of money, accounts, reckonings, bonds, bills, specialties, covenants,
controversies, agreements, promises, variances, trespasses, damages, judgments,
executions, claims, and demands, whatsoever, in law, admiralty or equity, which
such Employee or such Employee's heirs, successors or assigns ever had, now have
or hereafter can, shall or may have, for, upon or by reason of any matter, cause
or thing against any such released party; however, that the foregoing shall in
no event release the Company from its obligations set forth herein (or the
obligations referenced in Section 1.16 hereof).
(b) Without limiting the generality of the foregoing, each
Employee hereby expressly releases the Company and its subsidiaries, controlling
persons, affiliates, successors and assigns from any and all past, present and
future claims which he or she does not know of or suspect to exist in my favor,
whether through ignorance, oversight, error, negligence or otherwise and which,
if known, would materially affect his or her decision to enter into this release
and to this end such Employee hereby waives all of his or her rights under
Section 1542 of the Civil Code of California which states in full as follows:
"A general release does not extend to claims which the creditor does
not know or suspect to exist in its favor at the time of executing the
release which if known by him must have materially affected his
settlement with the debtor."
(c) Raffin and Viner represent and warrant to the Company that
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neither of them has sold, assigned or otherwise transferred to any other person
or entity any claim which he or she has, had, or may have, against the Company
or its subsidiaries, controlling persons, affiliates, successors or assigns.
(d) The Company or any other released party may plead the
foregoing release as a complete defense and bar to any claim brought in
contravention hereof. In that event, or in the event of any breach of the
representation contained in subparagraph (c), Raffin and Viner will indemnify,
defend, and hold harmless such released party from and against all costs and
expenses arising therefrom, including without limitation reasonable attorneys
fees and expenses.
2.3 (a) The Company, for itself and on behalf of its subsidiaries,
successors and assigns hereby releases and discharges Viner and Raffin from all
actions, causes of action, suits, debts, dues, sums of money, accounts,
reckonings, bonds, bills, specialties, covenants, controversies, agreements,
promises, variances, trespasses, damages, judgments, executions, claims, and
demands, whatsoever, in law, admiralty or equity, which the Company or its
subsidiaries ever had, now have for or hereafter can, shall or may have, upon or
by reason of any matter, cause or thing; provided, however, that the foregoing
shall in no event release the Viner and Raffin from their respective obligations
set forth herein.
(b) Without limiting the generality of the foregoing, the
Company hereby expressly releases Viner and Raffin from any and all past,
present and future claims which it does not know of or suspect to exist in its
favor, whether through ignorance, oversight, error, negligence or otherwise and
which, if known, would materially affect its decision to enter into this release
and to this end the Company hereby waives all of its rights under Section 1542
of the Civil Code of California which states in full as follows:
"A general release does not extend to claims which the creditor does
not know or suspect to exist in its favor at the time of executing the
release which if known by him must have materially affected his
settlement with the debtor."
(c) The Company, on behalf of itself, its subsidiaries,
successors and assigns, represents and warrants to Viner and Raffin that neither
it nor any other such releasing party has sold, assigned or otherwise
transferred to any other person or entity any claim which it has, had, or may
have, against Viner or Raffin.
(d) Raffin or Viner may plead the foregoing release as a
complete defense and bar to any claim brought in contravention hereof. In that
event, or in the event of any breach of the representation contained in
subparagraph (c), the Company will indemnify, defend, and hold harmless Viner
and Raffin from and against all costs and expenses arising therefrom, including
without limitation reasonable attorneys fees and expenses.
ARTICLE 3
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CONDITIONS
3.1 The Company and Employees' obligations hereunder are subject to the
fulfillment to its satisfaction of the following conditions:
3.2 The Board of Directors of the Company shall have approved this
Agreement, such approval to be conclusively evidenced by the execution of this
Agreement by an officer of the Company.
3.3 That certain Stock Purchase Agreement among Media Equities
International, LLC ("MEI") and Employees of even date herewith (the "Stock
Purchase Agreement") shall be fully executed by the parties thereto.
3.4 The Company and Employees shall have executed the Escrow Agreement.
3.5 The Company and Employees shall have executed the Registration
Rights Agreement.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
4.1 Viner and Raffin represent and warrant to the Company that: (A)(i)
each of Viner and Raffin is an "accredited investor," as defined in Rule 501
under the Securities Act; (ii) Viner and Raffin are acquiring the securities
issued pursuant to the Escrow Agreement (the "Shares") for Viner and Raffin's
own account for investment with no present intention of distributing or
reselling any such Shares with a view to any distribution within the meaning of
the Securities Act; (iii) Viner and Raffin have had the opportunity to ask
questions of the Company and of management of the Company regarding the Company
and have received all information reasonably requested by them; and (iv) Viner
and Raffin understand that the Shares have not been registered under the
Securities Act and that the certificates representing the Shares will bear an
appropriate restrictive legend. Viner and Raffin agree that they will not,
directly or indirectly, voluntarily offer, sell, pledge or otherwise dispose of
(or solicit any offers to purchase or otherwise acquire or take a pledge or) any
Shares unless (i) registered pursuant to the provisions of the Securities Act,
or (ii) an exemption from registration is available under the Securities Act and
(B) that each has the full power to execute this Agreement and consummate the
transactions contemplated herein and that this Agreement has been duly executed
and delivered by them and constitutes their respective binding obligations
enforceable in accordance with its terms.
4.2 The Company acknowledges that upon execution of this Agreement and
the Stock Purchase Agreement neither Viner nor Raffin shall be an "affiliate" of
the Company as such term is defined in the Securities Act, and that,
accordingly, subject to a change in circumstances, Viner and Raffin would be
able to sell their shares of Common Stock of the Company pursuant
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<PAGE> 8
to Rule 144 under the Securities Act three months after the date hereof
(assuming such persons have owned such shares for the requisite periods
specified in Rule 144).
4.3 Viner represents and warrants that he has not authorized the
disbursement of any funds outside of the ordinary course of business and the
normal payroll or to himself or Raffin since May 28, 1997.
4.4 The Company represents and warrants that the Company has the full
corporate power to execute this Agreement and consummate the transactions
contemplated herein and that this Agreement has been duly executed and delivered
on its behalf and constitutes its binding obligation enforceable in accordance
with its terms, subject to bankruptcy, insolvency, reorganization, moratorium,
receivership, and other laws of general applicability relating to or affecting
creditors' rights and to general equity principles.
ARTICLE 5
MISCELLANEOUS
5.1 (a) The parties will attempt in good faith to resolve through
negotiation any dispute, claim or controversy arising out of or relating to this
Agreement. Either party may initiate negotiations by providing written notice in
letter form to the other party, setting forth the subject of the dispute and the
relief requested. The recipient of such notice will respond in writing within
five days with a statement of its position on and recommended solution to the
dispute. If the dispute is not resolved by this exchange of correspondence, then
representatives of each party with full settlement authority will meet at a
mutually agreeable time and place within ten days of the date of the initial
notice in order to exchange relevant information and perspectives, and to
attempt to resolve the dispute. If the dispute is not resolved by these
negotiations, the matter will be submitted to JAMS/Endispute, or its successor,
for arbitration.
(b) The parties agree that any and all disputes, claims or
controversies arising out of or relating to this agreement that are not resolved
by their mutual agreement shall be submitted to final and binding arbitration
before JAMS/Endispute, or its successor, pursuant to the United States
Arbitration Act, 9 U.S.C. Sec. 1 et seq. Either party may commence the
arbitration process called for in this agreement by filing a written demand for
arbitration with JAMS/Endispute, with copy to the other party. The arbitration
will be conducted in accordance with the provisions of JAMS/Endispute's
Comprehensive Arbitration Rules and Procedures in effect at the time of filing
of the demand for arbitration. The parties will cooperate with JAMS/Endispute
and with one another in selecting an arbitrator from JAMS/Endispute's panel of
neutrals, and in scheduling the arbitration proceedings. The parties covenant
that they will participate in the arbitration in good faith, and that they will
share equally in its costs. The provisions of this paragraph may be enforced by
any Court of competent jurisdiction, and the
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<PAGE> 9
party seeking enforcement shall be entitled to an award of all costs, fees and
expenses, including attorneys fees, to be paid by the party against whom
enforcement is ordered.
(c) Notwithstanding anything in the Escrow Agreement to the
contrary, any award determined to be payable hereunder may, at the Company's
option, be paid in cash rather than Series E Preferred shares.
5.2 This Agreement, together with the Escrow Agreement and the
Registration Rights Agreement constitute the entire agreement of the parties and
supersedes all prior agreements of the parties with respect to the subject
matter hereof. This Agreement may not be changed or amended except in writing
signed by the parties. Notices required to be delivered hereunder shall be
delivered in accordance with the notice provisions of the Escrow Agreement.
5.3 This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective heirs, administrators, successors and
assigns. Notwithstanding the foregoing, Viner and Raffin may not delegate any of
its obligations hereunder except as expressly provided herein.
5.4 No provision of this Agreement shall be interpreted or construed
against any party because that party or its legal representative drafted such
provision. For all purposes of this Agreement, unless that context otherwise
requires or as otherwise expressly provided, (a) all defined terms shall include
both the singular and the plural forms thereof; (b) reference to any gender
shall include all other genders; (c) all references to words such as "herein",
"hereof", and the like shall refer to this Agreement as a whole and not to any
particular paragraph within this Agreement; (d) the term "include" means
"include without limitation"; and (e) the term "or" is intended to include the
term"and/or".
5.5 No waiver by any party hereto of any one or more defaults by any
other party or parties in the performance of any of the provisions of this
Agreement shall operate or be construed as a waiver of any future default or
defaults, whether of a like or different nature. No failure or delay on the part
of any party in exercising any right, power or remedy hereunder shall operate as
a waiver thereof, nor shall any single or partial exercise of any such right,
power or remedy preclude any other or further exercise thereof or the exercise
of any other right, power or remedy.
[The next page is also numbered page 9 (signature block)]
9
<PAGE> 10
5.6 This Agreement shall be subject to, and be governed by, the laws of
the State of California without regard to principles regarding conflicts of law
thereof.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement, in the case of the Company, by its duly authorized officer, all as of
the date first above written.
DOVE ENTERTAINMENT, INC.
/s/ MICHAEL VINER
--------------------------------
Michael Viner
/s/ STEVE SOLOWAY /s/ DEBORAH RAFFIN
- -------------------------------- --------------------------------
By: Steven Soloway Deborah Raffin
Its: V. P. and General Counsel
10
<PAGE> 11
EXHIBIT A
ESCROW AGREEMENT
11
<PAGE> 12
EXHIBIT B
REGISTRATION RIGHTS AGREEMENT
12
<PAGE> 1
EXHIBIT 10.46
SECURITIES PURCHASE AGREEMENT
SECURITIES PURCHASE AGREEMENT, dated as of June __, 1997 by and among
Media Equities International, LLC, a New York limited liability company ("MEI")
and Michael Viner ("VINER") and Deborah Raffin Viner ("RAFFIN"), individuals
residing at 1072 North Beverly Boulevard, Beverly Hills, California 90210.
WHEREAS, MEI has agreed to purchase and Viner and Raffin have agreed
to sell to MEI certain securities of Dove Entertainment, Inc. ("DOVE"), upon
the terms and conditions set forth in this Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. MEI hereby purchases from Viner and Raffin,
and Viner and Raffin hereby sell to MEI:
(a) All of the Series C Preferred Stock of Dove
and Warrants to purchase Common Stock of Dove acquired by Viner and Raffin
pursuant to that Stock Purchase Agreement made as of March 27, 1997, as
amended, among Dove, MEI, Viner and Raffin, including 1,570 shares of Series C
Preferred Stock of Dove and Warrants to purchase 825,000 shares of Common
Stock, of Dove for an aggregate purchase price of $1,570,000;
(b) 214,113 shares of Series D Preferred Stock of
Dove, constituting all of the Series D Preferred Stock owned by Viner and
Raffin, for an aggregate purchase price of $516,000;
(c) 500,000 shares of Common Stock of Dove owned
by Viner and Raffin for an aggregate purchase price of $1,000,000;
All payments shall be in cash, by wire transfer or otherwise immediately
available funds.
2. Viner and Raffin hereby assign all of their
respective rights to MEI or any third party
designated by MEI, under that certain Registration
Rights Agreement dated as of March 27, 1997, by and
among Dove, MEI, Viner and Raffin.
3. For a period commencing with the date hereof
and ending on the third anniversary of the date
hereof (the "REFUSAL PERIOD"), if Viner or Raffin
(the "SELLER") shall wish to make a transfer of any
or all of the Dove shares of Common Stock then
beneficially owned by either of them to any person (a
"PROSPECTIVE TRANSFEREE"), the Seller shall first
give written notice (the "SELLER'S NOTICE") to MEI
stating his wish to make such transfer, the name and
address of the prospective transferee, the number of
Dove shares desired
<PAGE> 2
to be transferred (the "OFFERED SHARES") and the
price and terms offered by the Prospective
Transferee, which price shall be payable only in
cash, and shall by such notice grant an option to MEI
to purchase the Offered Shares at the price and upon
the terms offered by the Prospective Transferee. In
all cases, the price and terms stated in such notice
must represent a bonafide offer that the Seller will
accept if the option under this paragraph is not
exercised, and the Prospective Transferee must not be
an affiliate or an associate (as such terms are
defined in the Securities Exchange Act of 1934 and
the rules thereunder) of the Seller. In addition,
the Seller may not give any notice and sell any Dove
shares unless the Offered Shares constitute at least
5,000 shares of Common Stock, or all of the Dove
shares owned by Viner and Raffin. The option under
this paragraph shall be exercisable by written notice
to the Seller given by MEI within 5 days after the
Seller's Notice, and the sale shall be closed not
later than 10 days after the giving of the Seller's
Notice under this paragraph.
4. Notwithstanding the foregoing provisions of
paragraph 3, if a proposed sale is to be made
pursuant to Rule 144 promulgated under the Securities
Act of 1933 or otherwise in a market transaction (a
"MARKET SALE"), during the Refusal Period:
(a) Viner and Raffin shall not sell in Market
Sales during any three month period more than the greater of (i) such sales as
may be permitted under the applicable volume limitations of Rule 144 applicable
to affiliates, and (ii) 150,000 shares of Common Stock;
(b) The Seller's Notice shall be personally
delivered to MEI and shall state the number of Dove shares desired to be sold
and the minimum per share price at which the Seller proposes to sell such
shares (the "MINIMUM PRICE") which price shall not exceed the closing sale
price of a share of Dove Common Stock on the day the Seller's Notice is given
to MEI, and shall not be less than 80% of such closing sale price;
(c) MEI shall have the option, exercisable by
written notice delivered to the Seller no later than 3 days after the Seller's
Notice is given, to purchase the Option Shares at the per share price equal to
the higher of the closing sale price of the shares of Dove Common Stock on the
day MEI delivers such written notice or the Minimum Price.
5. Viner and Raffin severally represent that (a)
each has full power to execute this Agreement and
consummate to the transactions contemplated herein
and that (b) the Series C Preferred Stock, Warrants,
Series D Preferred Stock and Common stock being sold
pursuant to this Agreement are owned by them are free
and clear of all liens and encumbrances and that upon
the purchase of the securities by MEI as contemplated
in this Agreement, MEI will acquire good and
marketable title to such securities free and clear of
all
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<PAGE> 3
liens, charges, claims, pledges and encumbrances of
any kind or nature whatsoever.
6. MEI represents and warrants to Viner and Raffin that
(a) MEI is an "accredited investor," as defined
in Rule 501 under the Securities Act of 1933 (the "SECURITIES ACT");
(b) MEI is acquiring the securities purchased
hereunder (the "SECURITIES") for MEI's own account for investment with no
present intention of distributing or reselling any such Securities with a view
to any distribution within the meaning of the Securities Act;
(c) MEI has had the opportunity to ask questions
of Viner and Raffin and of management of Dove regarding Dove and has received
all information reasonably requested by it; and
(d) MEI understands that the Securities have not
been registered under the Securities Act and that the certificates representing
the Securities will bear an appropriate restrictive legend. MEI agrees that it
will not, directly or indirectly, voluntarily offer, sell, pledge or otherwise
dispose of (or solicit any offer to purchase or otherwise acquire or take a
pledge of) any Securities unless (x) registered pursuant to the provisions of
the Securities Act, or (y) an exemption from registration is available under
the Securities Act.
7. This Agreement shall be governed by and
construed and enforced in accordance with the laws of
the State of California, without reference to any
otherwise applicable conflict of law provisions.
8. Any notice or other communication required or
permitted hereunder shall be sufficiently given only
if sent by confirmed facsimile transmission, by
overnight courier service, or by registered or
certified mail, postage prepaid, addressed as follows
or to such other address or addresses as may
hereafter be furnished in writing by notice similarly
given by one party to the other:
Viner or Raffin: 1072 North Beverly Boulevard
Beverly Hills, California 90210
Telephone: 310-550-1806
Telecopier: 310-273-1331
3
<PAGE> 4
With a required copy Williams & Connolly
(which shall not 725 Twelfth Street, N.W.
constitute notice) to: Washington, D.C. 20005
Attention: Charles Sweet, Esq.
Telephone: 202-434-5000
Telecopier: 202-434-5029
If to MEI: 1 Stamford Plaza - 12th Floor
Stamford, Connecticut 16901
Telephone: 203-323-1263
Telecopier: 203-323-1809
With required copies Ronald Lightstone
(which shall not 400 Parkwood Drive
constitute notice) to: Los Angeles, California 90077
Telephone: 310-271-5333
Telecopier: 310-271-3276
and
Morrison Cohen Singer & Weinstein, LLP
750 Lexington Avenue
New York, New York 10022
Attn: Peter D. Weinstein, Esq.
Jack Levy, Esq.
Telephone: 212-734-8600
Telecopier: 212-735-8708
Notice shall be effective immediately upon personal delivery
or telecopy, seven (7) business days after deposit in the mail, or one (1)
business day after deposit with an overnight courier service.
9. This Agreement contains the entire agreement
and understanding among the Parties with respect to
the subject matter hereof, and shall not be modified
or affected by any offer, proposal, statement or
representation, oral or written, made by or for any
party in connection with the negotiation of the terms
hereof. There are no representations, promises,
warranties, covenants, undertakings or assurances
(express or implied) other than those expressly set
forth or provided for herein and in the other
documents referred to herein. This Agreement may not
be modified or amended orally, but only by a writing
signed by the Parties.
4
<PAGE> 5
10. If any part of this Agreement is held to be
unenforceable or invalid under, or in conflict with,
the applicable law of any jurisdiction, the
unenforceable, invalid or conflicting part shall, to
the extent permitted by applicable law, be narrowed
or replaced, to the extent possible, with a judicial
construction in such jurisdiction that effects the
intent of the Parties regarding this Agreement and
such unenforceable, invalid or conflicting part. To
the extent permitted by applicable law,
notwithstanding the unenforceability, invalidity or
conflict with applicable law of any part of this
Agreement, the remaining parts shall be valid,
enforceable and binding on the parties.
11. This Agreement may be simultaneously
executed in several counterparts, each of
which shall be an original and all of which
shall constitute but one and the same
instrument.
12. (a) The parties will attempt in
good faith to resolve through negotiation any
dispute, claim or controversy arising out of
or relating to this Agreement. Either party
may initiate negotiations by providing
written notice in letter form to the other
party, setting forth the subject of the
dispute and the relief requested. The
recipient of such notice will respond in
writing within five (5) days with a statement
of its position on and recommended solution
to the dispute. If the dispute is not
resolved by this exchange of correspondence,
then representatives of each party with full
settlement authority will meet at a mutually
agreeable time and place within ten days of
the date of the initial notice in order to
exchange relevant information and
perspectives, and to attempt to resolve the
dispute. If the dispute is not resolved by
these negotiations, the matter will be
submitted to JoAoMoS/ENDISPUTE, or its
successor, for arbitration
(b) The parties agree that any and all disputes,
claims or controversies arising out of or relating to this agreement that are
not resolved by their mutual agreement shall be submitted to final and binding
arbitration before JoAoMoS/ENDISPUTE, or its successor, pursuant to the United
States Arbitration Act, 9 U.S.C. Sec. 1 et seq. Either party may commence the
arbitration process called for in this agreement by filing a written demand for
arbitration with JoAoMoS/ENDISPUTE, with a copy to the other party. the
arbitration will be conducted in accordance with the provisions of
JoAoMoS/ENDISPUTE's Comprehensive Arbitration Rules and Procedures in effect at
the time of filing of the demand for arbitration. The parties will cooperate
with JoAoMoS/ENDISPUTE and with one another in selecting an arbitrator from
JoAoMoS/ENDISPUTE's panel of neutrals, and in scheduling the arbitration
proceedings. The parties covenant that they will participate in the
arbitration in good faith, and that they will share equally in its costs. The
provisions of this Paragraph may be enforced by any Court of competent
jurisdiction, and the party seeking enforcement shall be entitled to an award
of all costs, fees and expenses, including attorneys fees, to be paid by the
party against whom enforcement is ordered.
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<PAGE> 6
13. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their
respective heirs, administrators, successors and
assigns.
14. No provision of this Agreement shall be
interpreted or construed against any party because
that party or its legal representative drafted such
provision. For all purposes of this Agreement,
unless the context otherwise requires or as otherwise
expressly provided, (a) all defined terms shall
include both the singular and the plural forms
thereof; (b) reference to any gender shall include
all other genders; (c) all references to words such
as "herein", "hereof", and the like shall refer to
this Agreement as a whole and not to any particular
Article of Section within this Agreement; (d) the
term "include" means "include without limitation";
and (e) the term "or" is intended to include the term
"and/or".
15. No waiver by any party hereto of any one or
more defaults by any other party or parties in the
performance of any of the provisions of this
Agreement shall operate or be construed as a waiver
of any future default or defaults, whether of a like
or different nature. No failure or delay on the part
of any party in exercising any right, power or remedy
hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such
right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right,
power or remedy.
IN WITNESS WHEREOF, each of the parties hereto has executed this
Agreement as of the date first set forth above.
MEDIA EQUITIES INTERNATIONAL LLC
By:/S/ Ronald Lightstone
---------------------
Name: Ronald Lightstone
Title: Partner
/S/ Michael Viner
-----------------
MICHAEL VINER
/S/ Deborah Raffin Viner
------------------------
DEBORAH RAFFIN VINER
6
<PAGE> 1
EXHIBIT 99
FOR IMMEDIATE RELEASE CONTACT:
Wendy Walker
Dove Entertainment, Inc.
(310) 786-1623
RON LIGHTSTONE NAMED ACTING CHIEF EXECUTIVE OFFICER
OF DOVE ENTERTAINMENT INC.;
Los Angeles, CA, June 11th, 1997--- Dove Entertainment Inc.
(NASDAQ;DOVE) announced today Ron Lightstone has been appointed acting CEO. Mr.
Lightstone was previously Senior Vice President of Viacom International Inc. and
more recently Chief Executive Officer of Spelling International Inc. Dove also
announced that Media Equities International (MEI) has expanded its investment in
Dove by purchasing 500,000 shares of common stock and all of the preferred stock
held by Michael Viner and his wife Deborah Raffin Viner, founders of Dove. The
Viners will remain the second largest shareholders of the company. Concurrent
with the sale of their equity interest Michael and Deborah relinquished their
executive positions and directorships. Both will serve as consultants to Dove
for the next five years. Replacing them on the board of Directors are Terrence
A. Elkes and Bruce Maggin.
MEI, an investment group composed of former Viacom and Capital
Cities/ABC executives, initially invested $4 million in Dove in return for 2,000
shares of preferred stock and 2,000,000 warrants to purchase common stock.
Today's additional investment brings MEI's investment to approximately $7
million.
The MEI group includes: Terrence A. Elkes, former president and CEO of
Viacom International, Inc.; Ken Gorman, former executive vice president of
Viacom International, Inc.; Jack Healy and Bruce Maggin, both of whom held
senior positions at ABC and are currently partners of H.A.M. Media Group LLC;
and Ron Lightstone.
Michael Viner will continue as Executive Producer and Deborah Raffin
Viner will continue as producer on the ABC movie of the week "Unwed Father"
starring Brian Austin Green. The duo have many other projects in various stages
of development including serving as Executive Producers of the much anticipated
ABC movie of the week "Futuresport" starring Wesley Snipes. Other projects and
affiliations will be announced shortly.
Under Michael Viner and Deborah Raffin Viner's leadership the company
went from zero revenue to a company bringing in over $25,000,000.00 a year. The
former CEO of Dove Entertainment said, "Today marks a milestone for our company.
I feel that Ron Lightstone and MEI are the right people to take the company to
the next level. I am certain that MEI's significant resources, both managerial
and financial, will strengthen Dove and lead the company to future profitable
growth."
<PAGE> 2
Ron Lightstone said, "Michael and Deborah deserve tremendous credit for
building Dove Entertainment. We look forward to expanding on the base they have
established in the audio, publishing and television and film businesses."
Dove Audio Inc. is a diversified entertainment company primarily
engaged in the publication of audio and printed books, the production and
distribution of television programming and feature films.
2
