Document:

EX-10.20

 

Exhibit 10.20

STOCK PURCHASE AGREEMENT

     This STOCK PURCHASE AGREEMENT (this “Agreement”) is made as of September 26, 2007, by
and among FX Real Estate and Entertainment Inc., a Delaware corporation (the “Company”),
CKX, Inc., a Delaware corporation (“CKX”) and Flag Luxury Properties, LLC, a Delaware
limited liability company (“Flag”, and together with CKX the “Purchasers”).

RECITALS

     WHEREAS, CKX wishes to purchase from the Company and the Company wishes to issue and sell to
CKX shares of common stock, par value $0.01 per share, of the Company representing 0.742% of the
outstanding shares of common stock of the Company after giving effect to the transactions
contemplated by this Agreement (the “CKX Shares”) for an aggregate purchase price of
$1,500,000, under the terms and subject to the conditions set forth in this Agreement;

     WHEREAS, Flag wishes to purchase from the Company and the Company wishes to issue and sell to
Flag shares of common stock, par value $0.01 per share, of the Company representing 0.248% of the
outstanding shares of common stock of the Company after giving effect to the transactions
contemplated by this Agreement (the “Flag Shares” and together with the CKX Shares, the
“Shares”) for an aggregate purchase price of $500,000, under the terms and subject to the
conditions set forth in this Agreement;

     NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:

1. Sale and Delivery of Shares

     (a) Sale and Purchase of the CKX Shares. Upon the terms and subject to the
conditions set forth in this Agreement on the date hereof, the Company shall issue and sell to CKX
the CKX Shares, and CKX shall purchase from the Company the CKX Shares (the “CKX Purchase”)
for an aggregate purchase price of $1,500,000 in cash by wire transfer to an account designated in
writing by the Company (the “CKX Purchase Price”). The Company shall deliver to CKX a
certificate representing the CKX Shares, registered in the name of CKX, against payment to the
Company of the CKX Purchase Price. The CKX Purchase shall be consummated immediately upon the
execution and delivery of this Agreement by each of the parties hereto and shall be conditioned
upon the consummation of the Flag Purchase (as defined below) in accordance with Section 1(b)
below.

     (b) Sale and Purchase of the Flag Shares. Upon the terms and subject to the
conditions set forth in this Agreement on the date hereof, the Company shall issue and sell to Flag
the Flag Shares, and Flag shall purchase from the Company the Flag Shares (the “Flag
Purchase”) for an aggregate purchase price of $500,000 in cash by wire transfer to an account
designated in writing by the Company (the “Flag Purchase Price”). The Company shall deliver
to Flag a certificate representing the Flag Shares, registered in the name of Flag, against payment
to the Company of the Flag Purchase Price. The Flag Purchase shall be consummated

 

 

immediately upon the execution and delivery of this Agreement by each of the
parties hereto and shall be conditioned upon the consummation of the CKX Purchase in accordance
with Section 1(a) above.

     (c) Required Consent. The Company shall deliver to each of CKX and Flag the
written consent of Column Financial, Inc. to the transactions contemplated by this Agreement
required pursuant to the terms of the Promissory Note dated June 1, 2007 of FX Luxury Realty, LLC
(the “Column Consent”).

2. Representations and Warranties of the Company. The Company hereby represents
and warrants to each of the Purchasers (provided that the Company makes the representations
and warranties in Section 2(b) and Section(d)(iii) below to CKX solely with respect to the CKX
Shares and to Flag solely with respect to the Flag Shares):

     (a) Power and Authorization. The Company is a corporation duly organized,
validly existing and in good standing under the laws of the state of Delaware. The Company has all
requisite capacity, power and authority to execute, deliver and perform this Agreement. The
execution, delivery, and performance of this Agreement have been duly authorized by the Company.

     (b) Valid Issuance of Shares. Upon issuance of the Shares in accordance with
the terms of this Agreement, the Shares will be duly authorized, validly issued, fully paid and
nonassessable and free and clear of all security interests, claims, liens, pledges, options,
encumbrances, charges, agreements and other arrangements or restrictions whatsoever
(“Encumbrances”), other than restrictions on transfer imposed by applicable U.S. federal,
state or foreign securities laws.

     (c) Binding Obligation. This Agreement constitutes a valid and binding
obligation of the Company, enforceable in accordance with its terms, except as enforceability may
be limited by bankruptcy, insolvency, reorganization, moratorium, or other laws affecting
creditors’ rights generally and limitations on the availability of equitable remedies.

     (d) No Breach. The execution and delivery by the Company of this Agreement,
the offering and sale of the Shares hereunder, and the compliance with the terms hereof by the
Company, do not (i) conflict with or result in a breach of the terms, conditions or provisions of,
(ii) constitute a default under, (iii) result in the creation of any Encumbrance upon the Shares
pursuant to, (iv) give any third party the right to modify, terminate, or accelerate any obligation
under, (v) result in a violation of, or (vi) require any authorization, consent, approval,
exemption, or other action by or notice to any court or administrative or governmental body
pursuant to, (A) the Company’s Certificate of Incorporation or bylaws, (B) any law, statute, rule,
or regulation to which the Company is subject, or (C) any agreement, instrument, order, judgment,
or decree to which the Company or any subsidiary of the Company is subject or by which any of their
respective assets are bound, except for the Column Consent and with respect to clause (B) as is not
reasonably likely to have a material adverse effect on the Company’s ability to consummate the
transactions contemplated hereby.

 

 

     (e) Capitalization. After giving effect to the transactions contemplated by
this Agreement, the CKX Shares shall represent 25.5% of the outstanding shares of common stock of
the Company and the Flag Shares shall represent 49.75% of the outstanding shares of common stock of
the Company.

3. Representations and Warranties of Purchasers. Each of the Purchasers hereby
represents and warrants, severally and not jointly, to the Company that: (i) by reason of such
Purchaser’s business and financial experience, such Purchaser is capable of evaluating the merits
and risks of the purchase of the Shares that it is purchasing hereunder and making an informed
investment decision with respect thereto; (ii) such Purchaser is able to bear the economic and
financial risk of the purchase of such Shares for an indefinite period of time, and is aware that
it may lose the entire amount of its investment; (iii) such Purchaser has had an opportunity to ask
questions and receive answers concerning the terms and conditions of the offering and sale of such
Shares and believes that it has had full access to such other information concerning the Company as
it has requested; (iv) it has, independently and without reliance upon the Company and based on
such documents and information as it has deemed appropriate, made its own investigation into the
business, prospects, operations, property, financial and other condition and creditworthiness of
the Company; (v) such Purchaser is acquiring such Shares for its own account, not as a nominee or
agent, and such Purchaser is not acquiring the Shares that it is purchasing hereunder with a view
to or for sale in connection with any distribution thereof within the meaning of the Securities Act
of 1933, as amended (other than, with respect to CKX, a distribution of such Shares to the
stockholders of CKX in connection with the stockholder distribution contemplated by the
Registration Statement on Form S-1 filed by the Company with the Securities and Exchange Commission
on August 24, 2007, and other than, with respect to Flag, the distribution to the members of Flag
contemplated by the Membership Interest Purchase Agreement of FX Luxury Realty, LLC, dated June 1,
2007, between FX Luxury Realty, LLC, CKX and Flag, as amended on June 18, 2007, and the pledge of
shares of the Company by Flag pursuant to the Line of Credit and Security Agreement, dated as of
the date hereof, between the Company, CKX and Flag); (vi) the execution, delivery, and performance
of this Agreement have been duly authorized by such Purchaser and do not require such Purchaser to
obtain any consent or approval that has not been obtained and do not contravene or result in a
default under such Purchaser’s certificate of incorporation or bylaws or other organizational
documents or, except as is not reasonably likely to have a material adverse effect on the ability
of such Purchaser to consummate the transactions contemplated hereby, any provision of any law or
regulation applicable to such Purchaser or, any agreement or instrument to which such Purchaser is
a party or by which such Purchaser is bound; and (vii) this Agreement constitutes the legal, valid
and binding obligation of such Purchaser, enforceable against such Purchaser in accordance with its
terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium, or other laws affecting creditors’ rights generally and limitations on the availability
of equitable remedies.

4. Use of Proceeds. The Company agrees that the entire amount of the CKX Purchase
Price and the Flag Purchase Price will be utilized solely for the purpose of working capital for
the Company and its consolidated subsidiaries; provided, however, that, except for
the Company’s obligations as guarantor under the Margin Loan, without the prior written consent of
each of CKX and Flag, no portion of the CKX Purchase Price or the Flag Purchase Price will at any
time be utilized, and the Company shall not permit any such amounts at any time to be

 

 

utilized, for repaying the principal amount of any indebtedness of the Company or
any of its consolidated Subsidiaries.

5. General Provisions.

     (a) Notices. Any notice, request, instruction, or other document to be given
hereunder by a party hereto shall be in writing and shall be deemed to have been given, (i) when
received if given in person, (ii) on the date of transmission if sent by telex, telecopy, or other
wire transmission (with answer back confirmation of such transmission), (iii) upon delivery, if
delivered by a nationally known commercial courier service providing next day delivery service
(such as Federal Express), or (iv) upon delivery, or refusal of delivery, if deposited in the U.S.
mail, certified or registered mail, return receipt requested, postage prepaid:

     If to the Company, to it at:

FX Real Estate and Entertainment Inc.

650 Madison Avenue

15th Floor

New York

New York 10022

Attention: Mitchell J. Nelson

Facsimile: 1 212 750 3034

     If to CKX, to it at:

CKX, Inc.

650 Madison Avenue

16th Floor

New York

New York 10022

Attention: Howard J. Tytel

Facsimile: 1 212 753 3188

     If to Flag, to it at:

Flag Luxury Properties, LLC

650 Madison Avenue

15th Floor

New York

New York 10022

Attention: Mitchell J. Nelson

Facsimile: 1 212 750 3034

     (b) Complete Agreement. This Agreement and the documents expressly referred
to herein embody the complete agreement and understanding among the parties hereto and supersede
and preempt any prior understandings, agreements or representations by or among the parties,
written or oral, with respect to the subject matter hereof.

 

 

     (c) Severability. Whenever possible, each provision of this Agreement will
be interpreted in such manner as to be effective and valid under applicable law, but if any
provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability
will not affect any other provision or any other jurisdiction, but this Agreement will be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision
had never been contained herein.

     (d) Counterparts. This Agreement may be executed simultaneously in three or
more counterparts (including by means of facsimile machine or e-mail), any one of which need not
contain the signatures of more than one party, but all such counterparts taken together shall
constitute one and the same Agreement.

     (e) Successors and Assigns. No party may assign either this Agreement or any
of its rights, interests, or obligations hereunder without the prior written consent of each of the
other parties hereto. Except as otherwise provided herein, this Agreement shall bind and inure to
the benefit of and be enforceable by any of the parties hereto and their respective successors and
permitted assigns.

     (f) Descriptive Headings; Interpretation. The descriptive headings of this
Agreement are inserted for convenience only and do not constitute a part of this Agreement. The
use of the word “including” in this Agreement shall be by way of example rather than by limitation.

     (g) Choice of Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.

     (h) Third-Party Beneficiary. The provisions hereof are solely for the
benefit of the parties hereto and will not give rise to any rights in any other third party.

     (i) Remedies. Each of the parties to this Agreement will be entitled to
enforce its rights under this Agreement specifically, to recover damages and costs (including
attorneys’ fees) caused by any breach of any provision of this Agreement and to exercise all other
rights existing in its favor. The parties hereto agree and acknowledge that money damages may not
be an adequate remedy for any breach of the provisions of this Agreement and that any party in its
sole discretion may apply to any court of competent jurisdiction (without proof of damages or
posting any bond or deposit) for specific performance and/or other injunctive relief in order to
enforce or prevent any violations of the provisions of this Agreement.

     (j) Amendment and Waiver. The provisions of this Agreement may be amended
only with the prior written consent of the parties hereto. No waiver by any party hereto of any
provision of this Agreement or any default, misrepresentation, or breach of warranty or covenant
hereunder, whether intentional or not, shall be valid unless the same shall be in writing and
signed by the party against whom such waiver is sought to be enforced nor shall such waiver be
deemed to extend to any prior or subsequent default, misrepresentation, or breach of warranty or
covenant hereunder or affect in any way any rights arising by virtue of any prior or subsequent
such occurrence.

 

 

     (k) Further Assurance. Subject to the terms and conditions of this
Agreement, after the date hereof, each of the Company and the Purchasers will use its reasonable
best efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws and regulations to give full effect to
transactions contemplated by this Agreement.

     (l) Delivery by Facsimile; E-mail. This Agreement and any amendments hereto,
to the extent signed and delivered by means of a facsimile machine or e-mail, shall be treated in
all manner and respects as an original signed version thereof delivered in person. At the request
of any party hereto each other party hereto shall re-execute original forms thereof and deliver
them to all other parties. No party hereto shall raise the use of a facsimile machine or e-mail to
deliver a signature or the fact that any signature or agreement or instrument was transmitted or
communicated through the use of a facsimile machine or e-mail as a defense to the formation or
enforceability of a contact and each such party forever waives any such defense.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

 

     IN WITNESS WHEREOF, the parties hereto have executed this Stock Purchase Agreement on the date
first written above.

	 	 	 
	 

	 	FX REAL ESTATE AND ENTERTAINMENT INC.
	 
	 	 
	 

	 	By: /s/ Mitchell J. Nelson
	 

	 	Name: Mitchell J. Nelson
	 

	 	Title: Vice President

	 	 	 
	 

	 	CKX, INC.
	 
	 	 
	 

	 	By: /s/ Thomas P. Benson
	 

	 	Name: Thomas P. Benson
	 

	 	Title: Chief Financial Officer

	 	 	 
	 

	 	FLAG LUXURY PROPERTIES, LLC
	 
	 	 
	 

	 	By: /s/ Paul C. Kanavos
	 

	 	Name: Paul C. Kanovos
	 

	 	Title: President

[Signature Page to Stock Agreement]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

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