STOCKHOLDER SUPPORT AGREEMENT
STOCKHOLDER SUPPORT AGREEMENT dated as of August 4, 1997 (this
"Agreement"), by and between the undersigned stockholder (the "Stockholder") of
Iwerks Entertainment, Inc., a Delaware corporation (the "Company"), and
Showscan Entertainment, Inc., a Delaware corporation ("Showscan"). Capitalized
terms used and not otherwise defined herein shall have the respective meanings
assigned to them in the Merger Agreement referred to below.
WHEREAS, as of the date hereof, the Stockholder owns of record and
beneficially an aggregate of 35,000 shares of Common Stock, par value $0.001
per share ("Company Common Stock") of the Company (such shares of Company
Common Stock, together with any other voting or equity securities of the
Company hereafter acquired by the Stockholder prior to the termination of this
Agreement, being referred to herein collectively as the "Shares").
WHEREAS, concurrently with the execution of this Agreement, the
Company, Showscan and IWK-1 Merger Corporation, a Delaware corporation and a
wholly owned subsidiary of the Company ("Merger Sub"), are entering into an
Agreement and Plan of Reorganization (as the same may be amended or modified at
any time and from time to time, in accordance with the terms thereof, the
"Merger Agreement"), pursuant to which, upon the terms and subject to the
conditions thereof, Merger Sub will be merged with and into Showscan (the
"Merger") and the Company will issue additional shares of Company Common Stock
to the stockholders of Showscan;
WHEREAS, the Board of Directors of the Company has approved this
Agreement within the meaning of Section 203(a)(1) of the Delaware General
Corporation Code; and
WHEREAS, as a condition to the willingness of Showscan to enter into
the Merger Agreement, Showscan has requested that the Stockholder agree, and in
order to induce Showscan to enter into the Merger Agreement, the Stockholder is
willing to agree, to vote for the issuance of additional shares of Company
Common Stock pursuant to the terms of the Merger Agreement, upon the terms and
subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements contained herein, and intending to be legally bound
hereby, the parties hereby agree as follows:
Section 1. VOTING OF SHARES. The Stockholder hereby agrees that,
at any meeting of the stockholders of the Company, however called, and in any
action by consent of the stockholders of the Company, the Stockholder will vote
all of the Shares (a) in favor of the issuance of additional shares of Company
Common Stock pursuant to the terms of the Merger Agreement and the other
transactions contemplated by the Merger Agreement and (b) in favor of any other
matter necessary to consummation of the transactions contemplated by the Merger
Agreement and considered and voted upon by the stockholders of the Company (or
any class
thereof). The Stockholder acknowledges receipt and review of a copy
of the Merger Agreement.
Section 2. TRANSFER OF SHARES. From and after the date hereof
until the earlier of any termination of this Agreement in accordance with the
terms hereof or the Effective Time, the Stockholder will not, directly or
indirectly, (a) sell, assign, transfer, pledge, encumber or otherwise dispose
of any of the Shares, (b) deposit any of the Shares into a voting trust or
enter into a voting agreement or arrangement with respect to any of the Shares
or grant any proxy or power of attorney with respect thereto which is
inconsistent with this Agreement or (c) enter into any contract, option or
other arrangement or undertaking with respect to the direct or indirect sale,
assignment, transfer or other disposition of any Company Common Stock.
Section 3. IRREVOCABLE PROXY.
(a) The Stockholder hereby appoints Xxxxxx Xxxx and X.
Xxxxxx Lemon, their successors or any other designee of Showscan, the sole and
exclusive and true and lawful proxy, agent and attorney-in-fact of the
Stockholder, with full power of substitution and resubstitution, to vote or to
execute and deliver written consents or otherwise act with respect to all of
the Shares, as fully, to the same extent and with the same effect as the
Stockholder might or could do under any applicable laws or regulations
governing the rights and powers of stockholders of a Delaware corporation, but
only in connection with the approval of the issuance of additional shares of
Company Common Stock pursuant to the terms of the Merger Agreement and such
other matters as may be necessary to effectuate the transactions contemplated
under the Merger Agreement (the "Merger Matters") and only in the event the
Stockholder does not vote on the Merger Matters, or any of them.
(b) The Stockholder shall execute such additional
documents and take such additional actions as Showscan may reasonably request
to effectuate or further secure and protect the rights of Showscan under this
Section 3.
(c) Showscan and the Stockholder intend that this proxy is
coupled with an interest in the Shares, and, as a result, this proxy shall be
irrevocable until the date this proxy terminates as provided in Section 3(e)
hereof, whereupon it shall automatically lapse.
(d) The Stockholder hereby revokes any other proxy or
proxies to act and vote on behalf of any and all Shares now or hereafter owned
by the Stockholder, and hereby ratifies and confirms all acts and votes that
the proxy specified herein may lawfully perform by virtue of this
authorization.
(e) This proxy shall terminate and shall be revoked upon
termination of this Agreement pursuant to Section 4 hereof.
Section 4. TERMINATION. This Agreement shall terminate (a) upon
any termination of the Merger Agreement in accordance with the terms thereof or
(b) in the event that
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the Board of Directors of the Company shall withdraw or modify in any manner
materially adverse to Showscan its approval or recommendation of the Merger
Agreement or the Merger.
Section 5. MISCELLANEOUS.
(a) This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter hereof and
supersedes all prior agreements and understandings, both written and oral,
between the parties with respect thereto. This Agreement may not be amended,
modified or rescinded except by an instrument in writing signed by each of the
parties hereto.
(b) If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law, or public
policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible to the fullest
extent permitted by applicable law in a mutually acceptable manner in order
that the terms of this Agreement remain as originally contemplated to the
fullest extent possible.
(c) This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without regard to the
principles of conflicts of law thereof.
(d) Notwithstanding anything herein to the contrary, the
covenants and agreements set forth herein shall not prevent any of the
Stockholder's designees, partners or affiliates serving on the Board of
Directors of the Company from taking any action, subject to and in conformity
with the applicable provisions of the Merger Agreement, while acting in such
capacity as a director of the Company.
(e) This Agreement may be executed in counterparts, each
of which shall be deemed an original and all of which together shall constitute
one and the same instrument.
(f) The Stockholder acknowledges that Showscan's rights
hereunder are unique and that it will not have adequate remedies at law for the
Stockholder's failure to perform his obligations hereunder. Accordingly, it is
agreed that Showscan shall have the right to specific performance and equitable
injunctive relief for the enforcement of such obligations in addition to all
other available remedies at law or in equity.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be duly executed as of the date first written above.
SHOWSCAN:
Showscan Entertainment, Inc., a Delaware
corporation
By: /s/ Xxxxxx Xxxx
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Name: Xxxxxx Xxxx
Title: President & CEO
STOCKHOLDER:
By: /s/ Xxxxxxx X. Xxxxxxxx III
-------------------------------------------
Name: Xxxxxxx X. Xxxxxxxx III
Title: Executive Vice President of Sales and
Marketing
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