EXHIBIT 10.1
CONFIDENTIAL TREATMENT REQUESTED BY ACCESS INTEGRATED TECHNOLOGIES, INC. OF
CERTAIN PORTIONS OF THIS AGREEMENT IN ACCORDANCE WITH RULE 24B-2 UNDER THE
SECURITIES EXCHANGE ACT OF 1934.
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DIGITAL CINEMA FRAMEWORK AGREEMENT
DIGITAL CINEMA FRAMEWORK AGREEMENT, dated as of June 12, 2005 (this
"Agreement"), by and among ACCESS INTEGRATED TECHNOLOGY, INC., a Delaware
corporation ("AIX"), ACCESS DIGITAL MEDIA, INC., a Delaware corporation ("ADM"),
CHRISTIE/AIX, INC., a Delaware corporation ("Christie/AIX"), and CHRISTIE
DIGITAL SYSTEMS USA, INC., a California corporation ("Christie").
W I T N E S S E T H :
WHEREAS, ADM is a wholly-owned subsidiary of AIX, and Christie/AIX is a
wholly-owned subsidiary of ADM;
WHEREAS, Xxxxxxxx is a leading provider of digital cinema projection
systems and related services;
WHEREAS, the parties desire to implement a program for the deployment of
digital cinema projection systems incorporating certain AIX technology, under
which:
(a) Xxxxxxxx/AIX would enter into distributor agreements ("Distributor
Agreements") with film distributors ("Distributors"), which Distributor
Agreements would provide, inter alia, for the payment of virtual print fees for
the booking of digital titles to cinema auditoriums equipped with Digital
Systems (as defined below);
(b) Christie/AIX would enter into license agreements (or in lieu
thereof such other form of agreement as the parties may determine to be
suitable) ("Exhibitor License Agreements") with *** ("***") and one or more
other film exhibitors ("Exhibitors"), which Exhibitor License Agreements would
provide, inter alia, for the license and deployment of Digital Systems to the
Exhibitor, the right to install a satellite dish on the roof of each cineplex
where Digital Systems are deployed and a requirement that the Exhibitor acquire
a Central Server (as defined below) as part of each Digital System deployed to
the Exhibitor;
(c) Xxxxxxxx would enter into service contracts ("Digital Cinema
Service Contracts") with Exhibitors, under which Xxxxxxxx would provide to
Exhibitors installation, maintenance and support services for Digital Systems
deployed pursuant to the Exhibitor License Agreements;
(d) Xxxxxxxx and Xxxxxxxx/AIX would enter into a supply agreement
(the "Supply Agreement"), under which Christie would supply Digital Systems to
Christie/AIX for license and deployment of such Digital Systems in accordance
with the terms of the Exhibitor License Agreements; and
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(e) Christie/AIX would seek to raise at least *** in equity
financing to fund the purchase from Christie of the first 200 Digital Cinema
Projection Systems (as defined below) and associated Central Servers (as defined
below) to be deployed under Exhibitor License Agreements, and would seek to
arrange additional debt and/or additional equity financing to finance the
purchase from Christie of up to an additional 2300 Digital Cinema Projection
Systems and associated Central Servers for deployment under the Exhibitor
License Agreements.
NOW, THEREFORE, in consideration of the foregoing premises and of the
mutual covenants hereinafter contained, the parties hereto hereby agree as
follows:
ARTICLE I
TERM
Section 1.01. TERM. Unless terminated earlier in accordance with the
provisions of this Agreement, the term of this Agreement shall commence on the
date of this Agreement and shall continue until December 31, 2018, and
thereafter shall be automatically extended for additional one year periods
unless either party gives to the other party written notice of termination, with
or without cause, at least thirty (30) days prior to the end of the original
term or any one-year extension period.
ARTICLE II
DISTRIBUTOR TERM SHEETS AND DISTRIBUTOR AGREEMENTS
Section 2.01. DISTRIBUTOR TERM SHEETS. Prior to the date of this
Agreement, Xxxxxxxx has executed a non-binding term sheet or letter of intent
with each of Disney and Universal. For a reasonable period of time after the
execution of this Agreement, Xxxxxxxx will use commercially reasonable efforts
to negotiate and sign non-binding term sheets or letters of intent or other
equivalents ("Term Sheets"), on the most favorable terms possible, with each of
Fox, Paramount, Sony Pictures Entertainment and Warner Brothers (together with
Disney and Universal, the "Major Film Distributors"), and such other
Distributors, including Dreamworks and New Line, as the parties consider
appropriate, regarding the payment of virtual print fees in connection with the
booking of digital titles to cinema auditoriums equipped with Digital Systems.
Xxxxxxxx and Xxxxxxxx/AIX will work closely together on all matters relating to
the negotiation and execution of each Term Sheet, and Xxxxxxxx and Xxxxxxxx/AIX
will promptly inform each other of any material changes or developments relating
to the negotiation and execution of each Term Sheet.
Section 2.02. DISTRIBUTOR AGREEMENTS. When Term Sheets have been executed
between Xxxxxxxx and three (3) of the Major Film Distributors, or two (2) of the
Major Film Distributors and both of Dreamworks and New Line, then, upon the
written approval of Xxxxxxxx/AIX (which approval will not be unreasonably
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withheld or delayed), Xxxxxxxx will assign such Term Sheets to Christie/AIX, and
Xxxxxxxx/AIX will use commercially reasonable efforts to negotiate and execute a
Distributor Agreement with each Distributor which is a party to an assigned Term
Sheet, based on the relevant Term Sheet. Thereafter, when a Term Sheet is
executed between Xxxxxxxx and a Distributor, then, upon the written approval of
Xxxxxxxx/AIX (which approval will not be unreasonably withheld or delayed),
Xxxxxxxx will assign such Term Sheet to Xxxxxxxx/AIX and Xxxxxxxx/AIX will use
commercially reasonable efforts to negotiate and execute a Distributor Agreement
with such Distributor based on such Term Sheet. Xxxxxxxx/XXX and Xxxxxxxx will
work closely together on all matters relating to the negotiation and execution
of each Distributor Agreement, and Xxxxxxxx/AIX and Xxxxxxxx will promptly
inform each other of any material changes or developments relating to the
negotiation and execution of each Term Sheet.
ARTICLE III
EXHIBITOR LICENSE AGREEMENTS
Section 3.01. *** AGREEMENT. When Term Sheets have been executed between
Xxxxxxxx and three (3) of the Major Film Distributors, or two (2) of the Major
Film Distributors and both of Dreamworks and New Line, Xxxxxxxx/AIX will use
commercially reasonable efforts to negotiate and execute an Exhibitor License
Agreement with *** (the "*** Exhibitor License Agreement"). Xxxxxxxx/XXX and
Xxxxxxxx will work closely together on all matters relating to the negotiation
and execution of the *** Exhibitor License Agreement, and Xxxxxxxx/AIX and
Xxxxxxxx will promptly inform each other of any material changes or developments
relating to the negotiation and execution of the *** Exhibitor License
Agreement.
Section 3.02. OTHER EXHIBITOR LICENSE AGREEMENTS. When and as considered
appropriate by the parties, Xxxxxxxx/AIX will use commercially reasonable
efforts to negotiate and execute an Exhibitor License Agreement with Exhibitors
other than ***, including the owner of the *** theaters at the *** in *** and
***. Xxxxxxxx/XXX and Xxxxxxxx will work closely together on all matters
relating to the negotiation and execution of each such Exhibitor License
Agreement, and Xxxxxxxx/AIX and Xxxxxxxx will promptly inform each other of any
material changes or developments relating to the negotiation and execution of
each such Exhibitor License Agreement.
ARTICLE IV
SUPPLY OF DIGITAL SYSTEMS BY XXXXXXXX
Section 4.01. DEFINITIONS. As used in this Agreement:
(a) "DIGITAL CINEMA PROJECTION SYSTEM" means a digital cinema
projection system consisting of a DLP Cinema(TM) 2k projector, capable of both
2-D and 3-D display, a digital cinema server, and such other system components
and software as are required to meet the applicable technical specifications and
any applicable system upgrade requirements specified in the Distributor
Agreements and the Exhibitor License Agreements.
(b) "CENTRAL SERVER" means, collectively, a central library server,
with AIX's Theatre Command Center software (including MySQL database software)
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installed, connecting all Digital Cinema Projection Systems within a theatre
complex, together with a storage array, computer rack, Uninterrupted Power
Source (UPS), main switch and patch panel.
(c) "DIGITAL SYSTEM" means a system consisting of one or more
Digital Cinema Projection Systems and one Central Server.
Section 4.02. SUPPLY OF DIGITAL SYSTEMS. As soon as reasonably practical
following the execution of this Agreement, Xxxxxxxx and Xxxxxxxx/AIX shall in
good faith negotiate and execute a mutually agreeable Supply Agreement for the
supply of Digital Systems by Xxxxxxxx to Christie/AIX for deployment pursuant to
the terms of the Exhibitor License Agreements. The Supply Agreement will include
provisions for:
(a) the supply of up to 2500 Digital Cinema Projection Systems by
Xxxxxxxx to Christie/AIX, as ordered from time to time by Xxxxxxxx/AIX from
Christie, at a purchase price (FOB factory) of *** for the first 1000 Digital
Cinema Projection Systems and *** for the remaining 1500 Digital Cinema
Projection Systems;
(b) the supply of Central Servers by Xxxxxxxx to Christie/AIX, in
such quantities as may be required for installation of Digital Systems at
cineplex locations pursuant to the Exhibitor License Agreements, at a purchase
price (FOB factory) equal to the sum of (i) the standard purchase price then
quoted by Dell for its 2850 server and AX100 storage array or equivalent, (ii)
the market price for computer rack, Uninterrupted Power Source (UPS), main
switch and patch panel, (iii) the per server cost of the MySQL software license
obtained by ADM for the MySQL database software included in the AIX Theater
Command Software, as such cost is reimbursed by Xxxxxxxx to ADM, plus (iv) as
reimbursement for license fees to be paid by Xxxxxxxx to ADM under the OEM
License Agreement (as defined in Section 5.01 below), *** per screen for each
screen in the cineplex location where such Central Server is installed (the
total estimated amount of the items referred to in clauses ((i) through (iii)
being approximately ***);
(c) the purchase of an initial 100 Digital Cinema Projection
Systems, and Central Servers associated therewith, subject to satisfaction or
waiver of the following conditions (which are solely for the benefit of
Christie/AIX and may be waived by Xxxxxxxx/AIX in writing):
(i) the execution of Term Sheets between Xxxxxxxx and each of
three (3) of the Major Film Distributors, or two (2) of the Major Film
Distributors and both of Dreamworks and New Line, and the assignment of such
Term Sheets by Xxxxxxxx to Xxxxxxxx/AIX;
(ii) the availability to Christie/AIX of at least *** in First
Tranche (as defined in Article VIII below) equity financing for the purchase of
Digital Systems;
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(d) the purchase of an additional 100 Digital Cinema Projection
Systems, and Central Servers associated therewith, subject to satisfaction or
waiver of the following conditions (which are solely for the benefit of
Christie/AIX and may be waived by Xxxxxxxx/AIX in writing):
(i) the execution of Distributor Agreements between
Xxxxxxxx/AIX and three (3) of the Major Film Distributors, or two (2) of the
Major Film Distributors and both of Dreamworks and New Line;
(ii) the execution of an Exhibitor License Agreement between
Xxxxxxxx/AIX and ***; and
(iii) the availability to Christie/AIX of at least *** in
Second Tranche (as defined in Article VIII below) equity financing for the
purchase of Digital Systems;
(e) the purchase of up to 2300 additional Digital Cinema Projection
Systems, and Central Servers associated therewith, subject to satisfaction or
waiver of all of the conditions set forth in (c) and (d) above and subject to
the continuing availability of the debt financing referred to in Section 8.02
below.
ARTICLE V
LICENSE OF ACCESS SOFTWARE
Section 5.01. OEM LICENSE AGREEMENT. As soon as reasonably practical
following the execution of this Agreement, Xxxxxxxx and ADM shall in good faith
negotiate and execute a mutually agreeable OEM license agreement (the "OEM
License Agreement") providing for the grant of a license by ADM to Xxxxxxxx to
install AIX's Theatre Command Center Software to Central Servers and distribute
AIX's Theatre Command Center Software as installed by Xxxxxxxx to such Central
Servers. The OEM License Agreement will include provisions for:
(a) payment of license fees with respect to AIX's Theatre Command
Center Software installed to Central Servers supplied by Xxxxxxxx to
Christie/AIX for deployment by Xxxxxxxx/AIX to *** pursuant to the *** Exhibitor
License Agreement, in the amount of *** per screen for each screen in the
cineplex location where such Central Server is installed; and
(b) payment of license fees with respect to AIX's Theatre Command
Center Software installed to Central Servers sold, leased or licensed by
Xxxxxxxx (other than as provided for in paragraph (a) above), in the amount of
*** for the first four (4) screens, and *** per screen for each screen in excess
of four (4) screens, at the cineplex location where such Central Server is
installed.
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ARTICLE VI
DIGITAL SYSTEM SUPPORT SERVICES
Section 6.01. *** SERVICE AGREEMENT. In connection with the execution of
the *** Exhibitor License Agreement, Xxxxxxxx will use commercially reasonable
efforts to concurrently sign a Digital Cinema Service Contract with *** (the
"*** Service Agreement") to be coterminous with the term of the *** Exhibitor
License Agreement. Xxxxxxxx and Xxxxxxxx/AIX will work closely together on all
matters relating to the negotiation and execution of the *** Service Agreement,
and Xxxxxxxx and Xxxxxxxx/AIX will promptly inform each other of any material
changes or developments relating to the negotiation and execution of the ***
Service Agreement.
Section 6.02. OTHER EXHIBITOR SERVICE AGREEMENTS. In connection with the
execution of any Exhibitor License Agreement between Xxxxxxxx/AIX and any
Exhibitor other than ***, Xxxxxxxx will use commercially reasonable efforts to
concurrently execute a Digital Cinema Service Contract with such Exhibitor to be
coterminous with the term of the Exhibitor License Agreement between
Christie/AIX and such Exhibitor. Xxxxxxxx and Xxxxxxxx/AIX will work closely
together on all matters relating to the negotiation and execution of each
Digital Cinema Service Contract, and Xxxxxxxx and Xxxxxxxx/AIX will promptly
inform each other of any material changes or developments relating to the
negotiation and execution of each such Digital Cinema Service Contract.
Section 6.03. SCOPE OF SERVICES. Xxxxxxxx will use commercially reasonable
efforts to include in the *** Service Agreement and any Digital Cinema Service
Contract provisions:
(a) for installation of Digital Systems, and for payment to Xxxxxxxx
of an installation fee in the amount of *** for each Digital Cinema Projection
System installed;
(b) for at least 19/7 technical support by telephone, preventative
and emergency maintenance services and monitoring services, and for payment to
Christie of an annual service fee in the amount of **** per screen, adjusted
annually in accordance with any increase in the CPI index;
(c) consistent with any service related requirements under any of
the Distribution Agreements in effect as of the time the *** Service Agreement
or any Digital Cinema Service Contract is entered into; and
(d) for assignability to an alternate service provider in the event
Christie is required to assign the *** Service Agreement and/or any Digital
Cinema Service Contract to an alternate service provider as may be required
under such terms as may be agreed to by Christie in connection with any debt
financing made available to Christie/AIX.
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Section 6.04. DELIVERY SERVICES. Xxxxxxxx will cooperate with AIX and
Christie/AIX in connection with the efforts of AIX and Christie/AIX to become
the exclusive provider of digital delivery services (whether through satellite,
fiber, hard-drive or other means) to any Distributors or Exhibitors requiring
such services.
ARTICLE VII
SERVICES PROVIDED BY AIX TO CHRISTIE/AIX
Section 7.01. BACK OFFICE SERVICES. AIX will provide Xxxxxxxx/AIX with
back office services, including with respect to accounting and personnel. AIX
will charge Xxxxxxxx/AIX customary fees for providing such services, not to
exceed a budgeted amount as agreed to between AIX and Christie from time to time
and in any event such budgeted amount shall be agreed upon no less frequently
than annually.
ARTICLE VIII
FINANCING
Section 8.01. INITIAL EQUITY FINANCING. Xxxxxxxx/AIX will use commercially
reasonable efforts to obtain, on terms and conditions acceptable to Xxxxxxxx/AIX
in its sole discretion, at least *** in equity financing to fund the purchase
from Christie and deployment of the first 200 Digital Cinema Projection Systems
and associated Central Servers to be deployed under Exhibitor License
Agreements. Xxxxxxxx/AIX will seek to obtain such equity financing in a first
tranche of up to *** to be completed by July 31, 2005 (the "First Tranche") and
a second tranche of up to *** to be completed by September 30, 2005 (the "Second
Tranche"), *** of each such tranche, for a total of ***, to be allocated for use
as contemplated by the preceding sentence.
Section 8.02. DEBT AND/OR ADDITIONAL EQUITY FINANCING. Xxxxxxxx/AIX will
use commercially reasonable efforts to arrange or obtain, on terms and
conditions acceptable to Christie/AIX in its sole discretion, debt financing
and/or additional equity financing to fund the purchase from Christie and
deployment of up to an additional 2300 Digital Cinema Projection Systems and
associated Central Servers to be deployed under Exhibitor License Agreements.
Section 8.03. COOPERATION. Xxxxxxxx will use commercially reasonable
efforts to assist AIX and/or Christie/AIX in securing the equity and debt
financing contemplated by this Article VIII. The parties hereto will reasonably
cooperate to seek to accommodate reasonable requests of funding sources with
respect to any such equity or debt financing, including amendment of this
Agreement or agreements entered into pursuant to this Agreement in respects
which do not materially affect the economic benefits accruing to the parties
under this Agreement or agreements entered into pursuant to this Agreement.
Section 8.04. POSSIBLE EQUITY PARTICIPATION BY XXXXXXXX IN CHRISTIE/AIX.
In connection with the funding of either the First Tranche or the Second
Tranche, Xxxxxxxx shall have the right to acquire shares of Christie/AIX in
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exchange for an equity investment of up to *** on the same terms and conditions
as are applicable to other equity participants in the First Tranche or Second
Tranche, as applicable. Xxxxxxxx/AIX shall give Xxxxxxxx reasonable prior notice
of the closing date of, and the material terms and conditions of, the First
Tranche and Second Tranche, and shall specify a reasonable period of time within
which Christie shall be required to respond in order to be able to exercise its
right to participate in either the First Tranche or the Second Tranche.
ARTICLE IX
JOINT MARKETING
Section 9.01. MARKETING AND PROMOTION. Each of Christie/AIX and Christie
agree to cross-market each other's products and services and to undertake such
additional promotional activities as may be agreed to between the parties from
time to time; provided, however, that neither Christie/AIX nor Xxxxxxxx shall be
obligated to market or promote a product or service of the other party if such
product or service competes with any of its own products or services.
ARTICLE X
CASH FLOW SHARE
Section 10.01. CASH FLOW SHARE. If Xxxxxxxx/AIX is successful in obtaining
the equity funding and debt financing referred to in Article VIII, and
Xxxxxxxx/AIX installs more than 200 Digital Cinema Projection Systems (with
associated Central Servers), any positive cash flow generated by Christie/AIX
after deducting any and all of its costs and expenses, including, without
limitation, interest expenses, taxes, debt service and any and all amounts
payable by Xxxxxxxx/AIX to AIX and/or Christie for products and services
(including administrative charges) provided hereunder or under the agreements
contemplated hereby (the "Cash Flow"), shall be allocated and paid as follows:
(a) first, until all interest, principal and other amounts in
respect of the debt financing contemplated by Article VIII have been paid in
full, such amounts up to 100% of Cash Flow as are required to satisfy current
debt service, debt repayment and cash retention requirements relating to such
debt financing;
(b) then, to the extent of Cash Flow remaining after application of
paragraph (a) and until all payments under this paragraph (b) have been made in
full:
(i) first, such amounts up to 100% of Cash Flow as are required
to pay to the equityholders of Christie/AIX (the "Equityholders") a cumulative
dividend equal to ***% per annum with respect to the outstanding balance (as
reduced from time to time by payments under (b(ii)) of the equity funding made
available by the Equityholders to Christie/AIX; and
(ii) second, such amounts up to 100% of Cash Flow as are required
to pay to the Equityholders dividends in a total aggregate amount equal to the
equity funding amount made available by the Equityholders to Christie/AIX; and
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(c) then, after all interest, principal and other amounts in respect
of the debt financing contemplated by Article VIII and all amounts required
under paragraph (b) have been paid in full and until the end of the calendar
year in which the last payment of virtual print fees is made under any of the
Distributor Agreements, *** percent (***%) of the Cash Flow shall be allocated
to and paid to Xxxxxxxx and *** percent (***%) of the Cash Flow shall be
allocated to Christie/AIX, which allocation and disposition shall be made as
often as reasonably practical, but not less than annually.
Section 10.02. DISPUTED PAYMENTS; ARBITRATION. If a dispute arises in good
faith with respect to any amount due under this Agreement or any other agreement
executed between any of the parties hereto as contemplated hereby, the payor
shall pay any undisputed amount, if any, when and as due, and shall promptly pay
such further amount as may be required upon resolution of the dispute. If any
such dispute cannot be resolved by amicable discussion between the parties, such
dispute shall be arbitrated in accordance with the rules, procedures and
practices of the American Arbitration Association before a single arbitrator
located in New York City and agreed to by the parties.
Section 10.03. CURRENCY. All invoices hereunder shall be rendered, and all
payments hereunder shall be made, in U.S. Dollars.
Section 10.04. NO EQUITY INTEREST OR PARTNERSHIP. Nothing contained in
this Article X does give or shall be construed as giving to Christie any equity
interest in Christie/AIX, or creates or shall be construed as creating any
partnership or joint venture between Xxxxxxxx and Christie/AIX.
ARTICLE XI
ADM CINEMA CORPORATION ROLL-IN
Section 11.01. ADM CINEMA CORPORATION ROLL-IN. ADM Cinema Corporation, a
Delaware corporation and wholly owned subsidiary of AIX ("ADM Cinema")
previously purchased from Christie, and is the owner of, five (5) digital cinema
projectors and related equipment (the "ADM Cinema Units") currently located at
the Pavillion Movie Theater, 000 Xxxxxxxx Xxxx Xxxx, Xxxxxxxx, XX 00000.
Xxxxxxxx and Xxxxxxxx/AIX agree that, in connection with the deployment of
Digital Systems by Xxxxxxxx/AIX, Xxxxxxxx and Xxxxxxxx/AIX will, upon the
execution of an Exhibitor License Agreement between Christie/AIX and ADM Cinema
and a Digital Cinema Service Agreement between Christie and ADM Cinema with
respect to the ADM Cinema Units, proceed as follows:
(a) Xxxxxxxx will invoice to ADM Cinema the *** per projector
installation charge payable by ADM Cinema to Christie under the Digital Cinema
Service Agreement to be entered into between ADM Cinema and Christie, and will
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credit against such amount the installation charges previously paid by ADM
Cinema to Christie for installation of the ADM Cinema Units;
(b) Xxxxxxxx will refund to ADM Cinema the full purchase price of
the ADM Cinema Units previously paid by ADM Cinema to Christie, less the
outstanding invoice amount after credit under the invoice issued by Xxxxxxxx
under paragraph (a) above, which invoice shall thereupon be satisfied;
(c) Xxxxxxxx will invoice Christie/AIX in the amount of *** per unit
for each of the ADM Cinema Units; and
(d) Xxxxxxxx/AIX will pay the amount of such invoice to Xxxxxxxx.
ARTICLE XII
USE OF CHRISTIE NAME
Section 12.01. USE OF CHRISTIE NAME. AIX and Christie/AIX acknowledge that
"Christie" is a registered trademark of Xxxxxxxx. Xxxxxxxx/AIX shall have the
right to use the name "Christie" in its corporate name until such time as
Xxxxxxxx may require discontinuation of such use by written notice thereof given
by Xxxxxxxx to Christie/AIX. Upon any such notice, Xxxxxxxx/AIX shall, as
promptly as reasonably possible, change its corporate name to remove "Christie"
therefrom and discontinue use of the Christie name in connection with its
business. For so long as the name "Christie" is included in the corporate name
of Xxxxxxxx/AIX, Christie/AIX shall refrain from any action which may be
injurious to the good reputation of Xxxxxxxx.
ARTICLE XIII
TERMINATION
Section 13.01. TERMINATION FOR CHRISTIE BREACH. AIX or Christie/AIX may
terminate this Agreement by written notice to Xxxxxxxx in the event Christie
materially breaches or defaults in its performance under this Agreement and
fails to cure such breach within thirty (30) days after notice of such breach by
the notifying party.
Section 13.02. TERMINATION FOR AIX OR CHRISTIE/AIX BREACH. Xxxxxxxx may
terminate this Agreement by written notice to AIX in the event AIX or
Christie/AIX materially breaches or defaults in its performance under this
Agreement and fails to cure such breach within thirty (30) days after notice of
such breach by the notifying party.
Section 13.03. DISTRIBUTOR MATTERS. Any party may terminate this Agreement
by written notice to the other parties to this Agreement in the event that
(a) Xxxxxxxx has not executed, and assigned to Xxxxxxxx/AIX, Term
Sheets with at least three (3) of the Major Film Distributors, or,
alternatively, at least two (2) of the Major Film Distributors and both of
Dreamworks and New Line, on or before June 30, 2005; or
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(b) Xxxxxxxx/AIX has not signed Distributor Agreements with at least
three (3) of the Major Film Distributors, or, alternatively, at least two (2) of
the Major Film Distributors and both of Dreamworks and New Line, on or before
August 31, 2005.
Section 13.04. *** MATTERS. Any party may terminate this Agreement by
written notice to the other parties to this Agreement in the event that both the
*** Exhibitor License Agreement between Christie/AIX and *** and the *** Service
Agreement between *** and Christie have not been executed by the respective
parties thereto on or before August 31, 2005.
Section 13.05. INITIAL PURCHASE ORDER. Xxxxxxxx may terminate this
Agreement by written notice to the other parties to this Agreement in the event
Christie/AIX does not submit to Christie a firm purchase order for the initial
100 Digital Cinema Projection Systems and associated Central Servers on or
before July 31, 2005 and a firm purchase order for the next 100 Digital Cinema
Projection Systems and associated Central Servers on or before September 30,
2005.
Section 13.06. UNAVAILABILITY OF EQUITY FINANCING. Any party may terminate
this Agreement by written notice to the other parties to this Agreement in the
event that the First Tranche has not funded on or before July 31, 2005 or in the
event the Second Tranche has not funded on or before September 30, 2005.
Section 13.07. UNAVAILABILITY OF DEBT FINANCING. Any party may terminate
this Agreement by written notice to the other parties to this Agreement in the
event that, at any time after initial deployment of Digital Systems to ***,
deployment of Digital Systems is suspended for more than a three (3) month
period due to the unavailability of debt financing during such period.
Section 13.08. OCCURRENCE OF CERTAIN EVENTS. Any party may terminate this
Agreement by written notice to the other parties to this Agreement in the event
of the filing of any petition under any bankruptcy law by or against any other
party, the admission in writing by any other party of its inability to pay its
debts when and as due, the making of any assignment for the benefit of creditors
by any other party, the appointment of a receiver for any or all of the assets
of any other party, the cessation of any other party's business, or the
dissolution of any other party.
ARTICLE XIV
EFFECT OF TERMINATION
Section 14.01. GENERAL. In the event of the expiration or any termination
of this Agreement, all rights and obligations of the respective parties shall
terminate as of the effective date of such expiration or termination, except
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that (i) such expiration or termination shall not constitute a waiver of any
rights that any party may have by reason of a breach of this Agreement, (ii)
such expiration or termination shall not constitute a waiver of any right to
receive payments that are due and owing pursuant to this Agreement, including,
without limitation, any payments required to be made by any Distributor or
Exhibitor utilizing the Digital Systems paid for by Xxxxxxxx/AIX, which payments
shall continue to be made to Christie/AIX, and (iii) the provisions of Articles
VIII and XVI shall continue in full force and effect in accordance with their
respective terms.
Section 14.02. TERMINATION PRIOR TO DEPLOYMENT. In the event this
Agreement is terminated prior to the initial deployment of any Digital Systems
by Xxxxxxxx due to a material breach of this Agreement by Xxxxxxxx/AIX,
Christie/AIX shall, at the request of Xxxxxxxx, assign to Xxxxxxxx any
Distributor Agreements executed by Xxxxxxxx/AIX pursuant to Term Sheets assigned
by Xxxxxxxx to Christie/AIX.
ARTICLE XV
WARRANTY DISCLAIMER
Section 15.01. DISCLAIMER OF GENERAL WARRANTY BY AIX AND XXXXXXXX/AIX.
EACH OF AIX AND CHRISTIE/AIX MAKES NO REPRESENTATION OR WARRANTY, EXPRESS OR
IMPLIED, CONCERNING THE PERFORMANCE OF THEIR RESPECTIVE OBLIGATIONS UNDER THIS
AGREEMENT, INCLUDING ANY IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE,
MERCHANTABILITY OR OTHERWISE. IN NO EVENT SHALL AIX OR CHRISTIE/AIX BE LIABLE
FOR ANY SPECIAL, INCIDENTIAL OR CONSEQUENTIAL DAMAGES, INCLUDING, WITHOUT
LIMITATION, LOSS OF PROFITS, REVENUES OR DATA WHETHER BASED ON BREACH OF
CONTRACT, TORT OR OTHERWISE, WHETHER OR NOT ANY OTHER PARTY HAS BEEN ADVISED OF
THE POSSIBILITY OF SUCH DAMAGES. THE LIABILITY OF XXXXXXXX/AIX FOR DAMAGES OR
ALLEGED DAMAGES HEREUNDER, WHETHER IN CONTRACT, TORT OR ANY OTHER LEGAL THEORY,
IS LIMITED TO, AND WILL NOT EXCEED, ANY DIRECT DAMAGES.
Section 15.02. DISCLAIMER OF GENERAL WARRANTY BY XXXXXXXX. XXXXXXXX MAKES
NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, CONCERNING THE PERFORMANCE OF
ITS OBLIGATIONS HEREUNDER, INCLUDING ANY IMPLIED WARRANTY OF FITNESS FOR A
PARTICULAR PURPOSE, MERCHANTABILITY OR OTHERWISE. IN NO EVENT SHALL XXXXXXXX BE
LIABLE FOR ANY SPECIAL, INCIDENTIAL OR CONSEQUENTIAL DAMAGES, INCLUDING, WITHOUT
LIMITATION, LOSS OF PROFITS, REVENUES OR DATA WHETHER BASED ON BREACH OF
CONTRACT, TORT OR OTHERWISE, WHETHER OR NOT ANY OTHER PARTY HAS BEEN ADVISED OF
THE POSSIBILITY OF SUCH DAMAGES. THE LIABILITY OF XXXXXXXX FOR DAMAGES OR
ALLEGED DAMAGES HEREUNDER, WHETHER IN CONTRACT, TORT OR ANY OTHER LEGAL THEORY,
IS LIMITED TO, AND WILL NOT EXCEED, ANY DIRECT DAMAGES.
12
ARTICLE XVI
CONFIDENTIALITY
Section 16.01. CONFIDENTIALITY. Except as may otherwise be required by
applicable law, rule and regulation, including without limitation the federal
securities laws and the rules and regulations promulgated thereunder, each party
agrees that for the longest period permitted by applicable law, it shall hold in
strictest confidence and, without the prior written approval of the other
parties hereto, not use for its own benefit or disclose to any person, firm or
corporation (other than as required by applicable law) any confidential
proprietary information concerning the business and affairs of the other parties
hereto; provided, however, that the foregoing limitations and restrictions shall
not apply to information that (a) is or becomes generally available to the
public other than as a result of a disclosure by the directors, officers,
shareholders, partners, affiliates, employees, agents or advisors of any party,
or (b) is or becomes available to one of the parties on a non-confidential basis
from a source other than one of the other parties hereto or any of its advisors,
agents or affiliates, provided that such source is not known by such other
party, as the case may be, to be bound by a confidentiality agreement with or
other obligation of secrecy to the other parties hereto. Each of the parties
recognize that the absence of a time limitation in this Section 16.01 is
reasonable and properly required for the protection of the other parties hereto
and in the event that the absence of such limitation is deemed to be
unreasonable by a court of competent jurisdiction, each party agrees submit to
the imposition of such limitation(s) as said court shall deem reasonable.
Section 16.02. EQUITABLE REMEDIES Each party specifically recognizes that
any breach of Section 16.01 will cause irreparable injury to the other parties
hereto and that actual damages may be difficult to ascertain, and in any event,
may be inadequate. Accordingly (and without limiting the availability of legal
or equitable, including injunctive, remedies under any other provisions of this
Agreement), each party agrees that in the event of any such breach, the other
parties hereto shall be entitled to injunctive relief in addition to such other
legal and equitable remedies that may be available. In addition, each party
agrees that the provisions of Section 16.01 shall be considered separate and
apart from the remaining provisions of this Agreement and shall be enforced as
such.
ARTICLE XVII
MISCELLANEOUS
Section 17.01. FURTHER ASSURANCES. Each party will, at any time and from
time to time after the date hereof, upon the request of any other party, do,
execute, acknowledge and deliver, or shall cause to be done, executed,
acknowledged and delivered, all such other instruments as may be reasonably
required in connection with the performance of this Agreement and each shall
take all such further actions as may be reasonably required to carry out or
further effect the transactions contemplated by this Agreement. Upon request,
each party will cooperate, and will its best efforts to have its officers,
directors and other employees cooperate, at the requesting party's expense,
13
during and after the term of this Agreement in furnishing information, evidence,
testimony and other assistance in connection with any actions, proceedings,
arrangements or disputes involving any of the other parties hereto.
Section 17.02. NOTICES. All notices or other communications required or
permitted hereunder shall be in writing and shall be deemed given or delivered
(a) when delivered personally or by private courier, (b) when actually delivered
by registered or certified United States mail, return receipt requested and
postage prepaid or (c) when sent by telecopy (provided, that, it is
simultaneously electronically confirmed), addressed as follows:
If to Xxxxxxxx:
Christie Digital Systems USA, Inc.
00000 Xxxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: President
If to Christie/AIX or AIX:
c/o Access Integrated Technologies, Inc.
00 Xxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxxxx, Esq.
with a copy to:
Xxxxxx Xxxx & Xxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax No.: (000) 000-0000
Attention: Xxxxxxxx Xxxxxxxxx, Esq.
or to such other address as such party may indicate by a notice delivered to the
other party hereto pursuant to the terms hereof.
Section 17.03. NO MODIFICATION EXCEPT IN WRITING. This Agreement shall not
be changed, modified, or amended except by a writing signed by the party to be
charged and this Agreement may not be discharged except by performance in
accordance with its terms or by a writing signed by the party to be charged.
Section 17.04A. ENTIRE AGREEMENT. This Agreement and all other documents
to be delivered in connection herewith set forth the entire agreement and
understanding between the parties as to the subject matter hereof and merges and
supersedes all prior discussions, agreements and understandings of every kind
and nature between them.
Section 17.04B. SEVERABILITY. If any provision of this Agreement or the
application of any provision hereof to any person or circumstances is held
14
invalid, the remainder of this Agreement and the application of such provision
to other persons or circumstances shall not be affected unless the provision
held invalid shall substantially impair the benefits of the remaining portions
of this Agreement.
Section 17.05. ASSIGNMENT. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
permitted assigns. This Agreement may not be assigned by Xxxxxxxx without the
prior written consent of Christie/AIX. AIX and/or Christie/AIX may assign this
Agreement, in whole or in part, to any Affiliate of AIX or Christie/AIX or in
connection with a financing, special purpose entity, merger or consolidation of
AIX or Christie/AIX or a sale of all or substantially all of AIX or
Christie/AIX's business. Except as provided in the preceding sentence, this
Agreement may not be assigned by Xxxxxxxx/AIX without the prior written consent
of Xxxxxxxx. "Affiliate" as used in this Agreement shall mean any person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such person.
Section 17.06. PUBLICITY; ANNOUNCEMENTS. Subject to applicable law,
Xxxxxxxx/AIX and Xxxxxxxx shall each be entitled to issue one or more press
releases relating to the subject matter of this Agreement and/or the
transactions contemplated herein; provided, however, that prior to the issuance
of any such press release, the party not issuing such press release shall be
entitled to review and provide reasonable comments with respect to such press
release, but shall not otherwise be entitled to prevent the issuance thereof.
Section 17.07. GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York, without giving
effect to the conflict of laws principles thereof. For purposes of this
Agreement, each party hereby irrevocably submits to the nonexclusive
jurisdiction of the courts of the State of New York, sitting in New York County,
and the courts of the United States for the Southern District of New York. Each
party irrevocably waives, to the fullest extent permitted by law, any objection
which it may now or hereafter have to the laying of the venue of any such suit,
action or proceeding brought in any such court, any claim that any such suit,
action or proceeding brought in such a court has been brought in an inconvenient
forum and the right to object, with respect to any such suit, action or
proceeding brought in any such court, that such court does not have jurisdiction
over such party. In any such suit, action or proceeding, each party waives, to
the fullest extent it may effectively do so, personal service of any summons,
complaint or other process and agrees that the service thereof may be made by
certified or registered mail, addressed to such party at its address set forth
in Section 17.02. Each party agrees that a final non-appealable judgment in any
such suit, action or proceeding brought in such a court shall be conclusive and
binding.
Section 17.08. CAPTIONS. The captions appearing in this Agreement are
inserted only as a matter of convenience and for reference and in no way define,
limit or describe the scope and intent of this Agreement or any of the
provisions hereof.
15
Section 17.09. INTERPRETATION. All pronouns and any variations thereof
shall be deemed to refer to the masculine, feminine, neuter, singular, or plural
as the identity of the person or persons referred to may require.
Section 17.10. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
CHRISTIE/AIX, INC.
By /s/ X. Xxxx Xxxx
------------------------------
Name: X. Xxxx Xxxx
Title: CEO
ACCESS INTEGRATED TECHNOLOGIES, INC.
By/s/ X. Xxxx Xxxx
------------------------------
Name: X. Xxxx Xxxx
Title: President/CEO
ACCESS DIGITAL MEDIA, INC.
By/s/ X. Xxxx Xxxx
------------------------------
Name: X. Xxxx Xxxx
Title: CEO
CHRISTIE DIGITAL SYSTEMS USA, INC
By/s/ Xxxx X. Xxxxx
------------------------------
Name: Xxxx X. Xxxxx
Title: President/COO
