EXHIBIT 4.12
CHEQUEMATE INTERNATIONAL, INC.
d/b/a C3D Digital
000 Xxxxxxxxxx Xxxx. Xxxxx 000
Xxxxxx xxx Xxx, Xx. 00000-0000
(000) 000-0000
(000) 000-0000 fax
Xxxx Xxxxxx, CEO
Cinema Internet Networks, Inc.
000-0000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX X0X 0X0
Re: Exclusive Agent Agreement for the Canadian PPV Assets August 3, 2000
Dear Xxxx:
This is an Exclusive Agent Agreement between our two companies, and we have
agreed that:
1. CinemaWorks (CWK) has the exclusive right to sell the Canadian PPV
assets specified in the PPV Asset Purchase Agreement signed by the
Parties on or about March 1, 2000.
2. Because CWK has title to the Canadian PPV assets, it is CWK's
responsibility to provide clear title to the assets to the buyer.
3. The term of this Exclusive Agent Agreement is one year.
4. CWK shall retain all costs and stock proceeds from the sale of these
assets, and the sale price and terms will be the sole responsibility
and decision of CWK. If the proceeds from the sale are in the form of
publicly traded stock, it shall be valued at the average market price
for the previous five working days. If not publicly traded, Chequemate
and CWK must agree on its value prior to the sale.
5. CWK will use its best efforts to maximize the sale price of the PPV
assets on behalf of CWK and Chequemate.
Very truly yours,
/s/ Xxxx Xxxxxx
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Xxxx Xxxxxx
General Counsel
Chequemate International, Inc.
Cinema Internet Networks, Inc. agrees to the above provisions.
/s/ Xxxxxxx Xxxxxx August 3, 2000
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Xxxxxxx Xxxxxx, CEO Dated
Chequemate International Inc. August 3, 2000
330 Washington Ste. 330
Marina Del Rey, Ca. 90292
Attn: Xxxxxxx Xxxx CEO
cc: Xxxx Xxxxxx and Xxxx XxXxxxx
This letter is to confirm our phone conversation today between myself, Xxxx
XxXxxxx and Xxxx Xxxxxx. We have agreed on the following in order to close the
purchase of the CinemaWorks ("CWK") assets by Chequemate ("C-3D"). The following
amendments were agreed to by the parties. All dollars are US$ unless otherwise
noted.
1. a) The new agreed net purchase price of the PPV assets is $251,000. At
this price, CWK still retains the Integra lease obligation until the
lease is paid by CWK or assigned to a purchaser of the Canadian PPV
assets.
b) To purchase the PPV assets, Chequemate will immediately deliver to
the escrow agent a certificate for 55,000 restricted shares and
immediately file a registration statement (S-3) with respect to those
shares to be released when shareholder approval is obtained by
CinemaWorks.
c) In addition, Chequemate will immediately place 40,000 restricted
C-3D Shares (144 stock) in escrow with Xxxxx Xxxxxx. The holding period
for these shares will begin on the date of this Agreement between the
parties.
2. Cinema Works will immediately (within 1 working day of Xxxxx Xxxxxx
receiving the Shares in #1 in escrow) call an extraordinary shareholder
meeting to approve the disposition of the PPV assets, a fait accompli.
This step is anticipated to be completed in approximately 30 days.
3. CWK and Chequemate will sign a separate "Exclusive Agent Agreement"
allowing CinemaWorks exclusive right to sell the Canadian PPV assets
for an amount solely determined by CinemaWorks. However, CWK will use
its best efforts to maximize the sale price of the assets.
4. Title to the PPV assets in Canada will remain with CWK until such time
as the assets are sold by CWK and title is transferred to a new buyer.
All cash and/or stock proceeds from the purchase will be retained by
CWK.
5. Until, the PPV assets in Canada are sold or until the restricted Shares
are released from escrow as per #7 below, Chequemate and its
subsidiary, Hotel Movie Network (HMN), will provide monthly new movies
and perform service calls for the Canadian hotel PPV systems in the
same professional manner as they do for the USA-based PPV assets. At
the same time, all monthly PPV movie revenues collected from the
Canadian PPV assets will continue to be sent to CWK. CinamaWorks will
also continue to invoice the Canadian PPV assets until the assets are
sold or until the 144 Shares are saleable under Rule 144 and released
from escrow as per #7 below.
6. CinemaWorks will continue to be liable for-and pay the Integra lease
payment each month from revenues collected in #5. And, the balance of
collected revenues will be sent to Chequemate on a quarterly basis
until such time as the Canadian PPV assets are sold to another company.
7. a) If CWK for any reason is unable to sell the Canadian PPV assets,
then the restricted stock will be transferred to CWK from escrow after
one (1) year and the Shares become saleable under Rule 144.
a) However, simultaneous with those Shares being released from
escrow to CWK, CinemaWorks will assign free and clear title
of the Canadian PPV assets to Chequemate.
b) If there is money still owed on the Integra lease by CWK at
this time, then it will be CWK's sole obligation to pay the
remainder of the Integra lease.
8. CWK will see shareholder approval for the disposition of its PPV
assets, with the understanding that the lease obligation to Xxxxx
Xxxxxxxxx must be removed from Xxxx Xxxxxx and CinemaWorks either
directly by Applegate or by Chequemate after taking assignment of this
obligation from Applegate. This may be accomplished by any documents
suitable to protect Xxxx Xxxxxx and CWK from any and all legal actions
related to what is now the Applegate lease obligation.
9. Should CWK successfully sell the Canadian PPV assets before the
Chequemate restricted Shares become saleable under Rule 144, then the
total proceeds amount shall be credited to Chequemate in the form of
restricted Shares to be released to CWK and Chequemate from escrow. The
value per restricted Share credited to Chequemate will be $3.00. For
example: if the total proceeds from the sale of the Canadian PPV assets
are $75,000, then Chequemate will receive 25,000 shares from escrow
with the remaining 15,000 shares going to CWK.
Signed: Signed:
/s/ Xxx Xxxx /s/ J. Xxxxxxx Xxxx
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Xxx Xxxx Xxxxxxx X. Xxxx
CFO, Cinema Internet Networks, Inc. CEO, Chequemate International Inc.
