EX-10.21



 





Exhibit 10.21




AMENDMENT NO. 2

TO

MEMBERSHIP INTEREST PURCHASE AGREEMENT




     This AMENDMENT NO. 2, dated as of September 27, 2007 (this “Amendment”), to the
MEMBERSHIP INTEREST PURCHASE AGREEMENT (the “Agreement”), dated as of June 1, 2007 and
amended by Amendment No. I to the Membership Interest Purchase Agreement, dated as of June 18,
2007, is entered into by and among FX LUXURY REALTY, LLC, a Delaware limited liability company (the
“Company”), CKX, Inc., a Delaware corporation (“Purchaser”), Flag Luxury
Properties, LLC, a Delaware limited liability company (“Flag”) and FX Real Estate and
Entertainment Inc., a Delaware corporation (“FXREE”). Capitalized terms used and not
otherwise defined herein shall have the meanings set forth in the Agreement.



     WHEREAS, Purchaser, Flag and the Company are parties to the Agreement; and



     WHEREAS, CKX, Flag and the Company previously entered into Amendment No. 1, dated as of June
18, 2007, to the Agreement (“Amendment No. I”) and, pursuant to Amendment No. I (i) CKX
formed NEWCO Inc. (which is now named FX Real Estate and Entertainment Inc. and is herein referred
to as “FXREE”) and, in connection therewith, contributed to the capital of FXREE an
aggregate 15.5% Membership Interest in the Company; (ii) CKX, as the sole stockholder of FXREE as
of the time of its formation, transferred and assigned all of the equity interests in FXREE to
Richard G. Cushing, as Trustee of the CKX FXLR Stockholder Distribution Trust 11, a conventional
trust formed pursuant to the CKX FXLR Stockholder Distribution Trust 11 Agreement (the “Conventional Trust”); and (iii) CKX transferred and assigned an aggregate
9.5% Membership Interest in the Company to Richard G. Cushing, as Trustee of the CKX FXLR
Stockholder Distribution Trust 1, a grantor trust formed pursuant to the CKX FXLR Stockholder
Distribution Trust I Agreement (the “Grantor Trust”); and



     WHEREAS, pursuant to the Agreement, CKX, Flag and the Grantor Trust have effected the
Reorganization and, in connection therewith and in exchange for shares of common stock of FXREE,
CKX, Flag and the Grantor Trust contributed to FXREE Membership Interests constituting 25%, 50% and
9.5%, respectively, of the outstanding Membership Interest in the Company; and



     WHEREAS, following the Reorganization, FXREE became the soleowner of all of the interests in
the Company (except for the Flag Priority Interest), and each of CKX, Flag and the Grantor Trust
were issued shares of common stock of FXREE in such amounts as resulted in the outstanding equity
of FXREE being owned 25% by CKX, 50% by Flag, 25% in the aggregate by the Grantor Trust and the
Conventional Trust together; and



     WHEREAS, it is contemplated that following the date hereof CKX and Flag shall purchase
additional shares of common stock of FXREE in such amounts as shall result in the outstanding
equity of FXREE being owned 25.50% by CKX, 49.75% by Flag and 24.75% in the aggregate by the
Grantor Trust and the Conventional Trust together; and



 









 





     WHEREAS, as of the date hereof, CKX shall transfer and assign shares of common stock of FXREE
representing an aggregate 23.50% equity interest therein to Richard G. Cushing, as Trustee of the
CKX FXLR Stockholder Distribution Trust 111, a conventional trust formed pursuant to and in
accordance with the CKX FXLR Stockholder Distribution Trust III Agreement (“Trust 3” and
such transfer and assignment referred to herein as the “First Transfer”); and



     WHEREAS, following the date hereof, and in no event later than concurrent with the Stockholder
Distribution, CKX shall transfer and assign to or for the benefit of CKX stockholders of record on
the record date to be determined by CKX for purposes of the of Stockholder Distribution shares of
common stock of FXREE representing an aggregate 2% equity interest in FXREE (the “Second
Transfer”); and



     WHEREAS, the parties desire to enter in this Amendment in order to amend the Agreement to
provide for, among other things, the First Transfer and Second Transfer.



     NOW, THEREFORE, in consideration of these premises and the mutual covenants and agreements set
forth herein, and for other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties hereto agree as follows:



ARTICLE 1.

AMENDMENTS TO THE AGREEMENT




     1.1 The Reorganization and Stockholder Distribution. Article VII of the Agreement is
hereby amended and restated in its entirety as follows:



     “7.1 Reorganization, Stockholder Distribution and Rights Offering. In connection with the
Stockholder Distribution, the parties agree that Purchaser may, on not less than three (3) business
days prior written notice, cause the Company and its members, and Flag, to take such preliminary
steps as may be required to be in a position to effect the Reorganization and Mandatory
Distribution in connection with the Stockholder Distribution. Notwithstanding anything to the
contrary contained herein, the parties agree to use their commercially reasonable efforts (i) to
effect the Stockholder Distribution as soon as reasonably practicable after the date hereof and
(ii) thereafter to effect the Rights Offering as soon as reasonably practicable following the
Stockholder Distribution. In that regard, but subject to the foregoing, the parties hereto agree as
follows:



          (a)Purchaser shall (i) effect the First Transfer, and (ii) in no event later than concurrent
with the Stockholder Distribution, effect the Second Transfer.




          (b) In connection with the transfers of Company membership interests pursuant to the
Reorganization, the Amended and Restated Operating Agreement shall be further restated and amended.




          (c) In connection with the foregoing, the parties acknowledge and agree that it is the intent
of this Section 7.1 that Purchaser’s obligations under the Agreement to effect the Reorganization
and the Stockholder Distribution (solely with respect to the Membership Interests to be transferred
as contemplated hereby) may be effected (in whole or in part, as applicable) pursuant to the
transactions contemplated by this Section 7.1 and (ii) immediately following the




 









 




Reorganization and after giving effect to the share transfers described in clause (a) above
and prior to the Stockholder Distribution, the Company shall be a subsidiary of FXREE and FXREE
shall have the following stockholders: Trust 3 and the transferee(s)
in connection with the Second Transfer (owning an aggregate 25.5% equity interest therein), Flag (owning a 49.75% equity interest
therein), and the Conventional Trust and Grantor Trust (together beneficially owning an aggregate
24.75% equity interest therein).




          (d) If requested by Flag, the Designated Flag Members shall enter into a registration rights
agreement that provides for one demand registration right for each Designated Flag Member with
regards to a registration on Form S-3 and two piggy-back registration rights on equity
registrations effected by FXREE for equity offerings of stockholders of the Company (and not
registrations in respect of Company shares only) , subject to underwriter lock-up and cut back
provisions, and such other terms and conditions as are customary and are agreed to by the parties
thereto.




          (e)The parties agree that any shares of common stock of FXREE distributed by Flag in the
Mandatory Distribution shall, at all applicable times, be subject to the Waiver of Rights and
Lock-Up Agreement, provided that the lock-up period with respect to members of Flag who are not
Designated Flag Members shall be one (1) year and not three (3) years, and stock certificates
representing such shares shall bear a legend identifying the foregoing restrictions.”




ARTICLE H.

MISCELLANEOUS




     2.1 Entire Agreement. This Amendment, the Agreement, the Exhibits
and Schedules to the Agreement constitute the entire agreement among the parties relating to the
subject matter hereof and supersede any and all prior agreements or understandings with respect to
the subject matter hereof.



     2.2 No Other Amendments or Modifications. Except as expressly provided in this
Amendment, the Agreement shall remain unmodified and in full force and effect in accordance with
its terms. The provisions of Article IX of the Agreement shall apply to this Amendment mutatis
mutandis.



[signature page follows]




 









 





     IN WITNESS WHEREOF, the parties hereto have executed this Amendment or
caused this Amendment to be executed effective as of the date and year first above

written.



	 	 	 
	 

	 	FX LUXURY REALTY, LLC
	 
	 	By: Flag Luxury Properties LLC,
Managing Member
	 
	 	 
	 

	 	By: /s/ Paul Kanavos
	 

	 	Name: Paul Kanavos
	 

	 	Title: President
	 
	 	 
	 

	 	CKX, INC.
	 
	 	 
	 

	 	By: /s/ Thomas Benson
	 

	 	Name: Thomas C. Benson
	 

	 	Title: Chief Financial Officer,
Executive Vice President and Treasurer
	 
	 	 
	 

	 	FLAG LUXURY PROPERTIES, LLC
	 
	 	 
	 

	 	By: /s/ Paul Kanavos
	 

	 	Name: Paul Kanavos
	 

	 	Title: President
	 
	 	 
	 

	 	FX REAL ESTATE AND
	 

	 	ENTERTAINMENT INC.
	 
	 	 
	 

	 	By: /s/ Paul Kanavos
	 

	 	Name: Paul Kanavos
	 

	 	Title: President