Exhibit 10.1
NON-COMPETITION AGREEMENT
This Non-Competition Agreement (this "Agreement") is entered into as
of August 31, 1999 by and among Big Entertainment, Inc., a Florida corporation
(the "Company") and Baseline II, Inc. ("Baseline"), Xxxx Xxxxx Associates, Inc.
("PKA") and Xx. Xxxx Xxxxx (Baseline, PKA and Xxxx Xxxxx are collectively
referred to herein as the "Sellers").
RECITALS
WHEREAS, the Company and the Sellers are parties to that certain
Asset Purchase Agreement, dated as of August 30, 1999 (the "Purchase
Agreement"), providing for the purchase by the Company of substantially all of
the assets of Baseline and Cinema Enterprises Group LLC ("CEG") and certain
assets of PKA;
WHEREAS, Xxxx Xxxxx is the Chief Executive Officer and principal
shareholder of PKA;
WHEREAS, the Company and the Sellers wish to provide for and
acknowledge certain arrangements and understandings following the closing of the
transactions contemplated by the Purchase Agreement; and
WHEREAS, the closing of the transactions contemplated by the Purchase
Agreement is conditioned upon the execution and delivery of this Agreement.
NOW, THEREFORE, in consideration of the premises and for other good
and valuable consideration, the parties hereto hereby agree as follows:
1. Defined Terms. Capitalized terms used but not otherwise defined
herein shall have the meanings assigned thereto in the Purchase Agreement. As
used in this Agreement, the following terms shall have the respective meanings
set forth in this Section 1:
"Business Day" means any day other than a Saturday, Sunday or other
day on which commercial banks in New York, New York are authorized or required
by law to close.
"Company" means Big Entertainment, Inc. and its subsidiaries and
affiliates.
"Competing Business" means any of XXxxxxx.xxx, XXxX.xxx, Mr.
Xxxxxxx.xxx, Xxxx.xxx, Xxxx.xxx or any other online web site or service whose
primary focus is movies or the motion picture industry.
"Person" means any individual, business, trust, unincorporated
association, corporation, partnership, joint venture, limited liability company
or other entity of any kind.
"Proprietary Information" means all intellectual property rights,
trade secrets and other proprietary or confidential information related to the
business and operations of Baseline or CEG, but excluding any intellectual
property rights, trade secrets or other proprietary or confidential information
developed independently by Sellers outside of the scope of the business of
Baseline or CEG. The term "Proprietary Information" includes, by way of example,
matters of a technical nature, "know-how," computer programs (including
documentation of such programs), research projects, and matters of a business
nature, such as proprietary information about costs, profits, markets, sales,
lists of customers, and other information of a similar nature to the extent not
available to the public, and such materials constituting plans for future
development.
2. Non-Solicitation and Non-Interference. For a period of five (5)
years after the date of this Agreement, none of the Sellers shall (a) induce or
attempt to induce any employee of the Company to leave the employ of the Company
or in any way interfere adversely with the relationship between any such
employee and the Company, (b) induce or attempt to induce any employee of the
Company to work for, render services or provide advice to or supply Proprietary
Information to any Person or (c) induce or attempt to induce any customer,
supplier, licensee, licensor, consultant or other business relation of the
Company to cease doing business with the Company or in any way interfere with
the relationship between any such customer, supplier, licensee, licensor,
consultant or other business relation and the Company.
3. Indirect Solicitation. For a period of five (5) years after the
date of this Agreement, none of the Sellers shall, directly or indirectly,
induce, assist or encourage any Person in carrying out, directly or indirectly,
any activity that would be prohibited by the provisions of Section 2 if such
activity were carried out by any of the Sellers, either directly or indirectly;
and, by way of example but not limitation, none of the Sellers shall, directly
or indirectly, induce, assist or encourage any employee of the Company to carry
out, directly or indirectly, any such activity.
4. Covenant Not to Compete. For a period of five (5) years after the
date of this Agreement, except on behalf of the Company, none of the Sellers
shall, directly or indirectly, manage, operate or control any business engaged
in, or otherwise engage in (through databases, publications, online services,
seminars or otherwise), the compilation, reproduction or distribution of movie
data, news or other information, including, without limitation, movie reviews,
film and television credits, information on movies in production, film and video
releases, movie revenue and cost estimates, box office data or biographies of
movie industry personnel. For a period of five (5) years after the date of this
Agreement, none of the Sellers shall, directly or indirectly, have any interest
in, own, manage, operate, control, be connected with as a stockholder (other
than as a stockholder of less than five percent (5%) of the issued and
outstanding stock of a company whose stock is listed on a national securities
exchange or quoted on The Nasdaq Stock Market), joint venturer, officer,
director, partner, employee or consultant, or otherwise engage, be interested
in, or invest or participate in any Competing Business. Notwithstanding the
foregoing, Sellers shall be permitted to provide consulting and valuation
services related to the motion picture industry so long as any such consulting
services are not provided to any Competing Business.
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5. Proprietary Information. From and after the date of this
Agreement, none of the Sellers shall (for the benefit of any of the Sellers or
for the benefit of any other Person) use or disclose any Proprietary Information
known to, or in the possession of, any of them.
6. Specific Enforcement. The parties hereto acknowledge and agree
that if any of the provisions of this Agreement were not performed in accordance
with their specific terms or were otherwise breached, irreparable damage would
occur and it would be extremely impracticable and difficult to measure damages.
Accordingly, in addition to any other rights and remedies to which the parties
may be entitled by law or equity, the parties shall be entitled to an injunction
or injunctions to prevent or cure breaches of the provisions of this agreement
and to enforce specifically the term and provisions hereof, and the parties
expressly waive (a) the defense that a remedy in damages will be adequate and
(b) any requirement, in an action for specific performance, for the posting of a
bond.
7. Governing Law. This Agreement shall be governed and construed in
all respects in accordance with the laws of the State of New York. The Company
and each of the Sellers each hereby consents to personal jurisdiction in any
action brought with respect to this Agreement and the transactions contemplated
hereby in the United States District Court for the Southern District of New York
or, if subject matter jurisdiction is unable to be obtained in such court, in
any state court in the City of New York in the State of New York. The Company
and each of the Sellers each also agrees that service of process may be
accomplished pursuant to the provisions of Section 10 hereof.
8. Successors and Assigns. Except as otherwise provided herein, the
provisions hereof shall inure to the benefit of and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto.
9. Entire Agreement; Amendment. This Agreement constitutes the full
and entire understanding and agreement between the parties with regard to the
subjects hereof, and no party shall be liable or bound to any other party in any
manner with respect to such subjects by any warranties, representations or
covenants except as specifically set forth herein. Except as expressly provided
herein, neither this Agreement nor any term hereof may be amended, waived,
discharged or terminated other than by a written instrument signed by the party
against whom enforcement of any such amendment, waiver, discharge or termination
is sought.
10. Notices, etc. Unless otherwise provided, any notice, request,
demand or other communication required or permitted under this Agreement shall
be given in writing and shall be deemed effectively given upon personal delivery
to the party to be notified, or when sent by telex or telecopier (with receipt
confirmed), or one Business Day following deposit with overnight courier or
three Business Days following deposit with the United States Post Office, by
registered or certified mail, postage prepaid and addressed as follows (or at
such other address as a party may designate by notice to the other):
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If to the Company:
Big Entertainment, Inc.
0000 Xxxxxx Xxxx, Xxxxx 000X
Xxxx Xxxxx, Xxxxxxx 00000-0000
Attention: Chief Executive Officer
Telecopier: (000) 000-0000
with a copy to:
Big Entertainment, Inc.
0000 Xxxxxx Xxxx, Xxxxx 000X
Xxxx Xxxxx, Xxxxxxx 00000-0000
Attention: General Counsel
Telecopier: (000) 000-0000
If to the Sellers:
Xxxx Xxxxx Associates, Inc.
000 Xxxxx Xxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Xx. Xxxx Xxxxx
Telecopier: (000) 000-0000
with a copy to:
Xxxxx X. Xxxx, Esq.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Telecopier: (000) 000-0000
Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
invalid, unenforceable or void, this Agreement shall continue in full force and
effect without said provision. It is the desire and intent of the parties hereto
that the restrictions set forth in Sections 2 through 5 of this Agreement shall
be enforced and adhered to in every particular, and in the event that any
provision, clause or phrase shall be declared by a court of competent
jurisdiction to be judicially unenforceable either in whole or in part - whether
the fault be in duration, geographic coverage or scope of activities precluded -
the parties agree that they will mutually petition the court to sever or limit
the unenforceable provision so as to retain and effectuate to the greatest
extent legally permissible the intent of the parties as expressed in Sections 2
through 5 of this Agreement.
11. Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
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12. Facsimile Signatures. Any signature page delivered by a fax
machine or telecopy machine shall be binding to the same extent as an original
signature page, with regard to any agreement subject to the terms hereof or any
amendment thereto. Any party who delivers such a signature page agrees to later
deliver an original counterpart to any party which requests it.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
The foregoing agreement is hereby executed as of the date first above
written.
BIG ENTERTAINMENT, INC.
By /s/ Xxxxxxxx Xxxxxxxxxx
--------------------------------------------
Name: Xxxxxxxx Xxxxxxxxxx
Title: Chairman of the Board and Chief
Executive Officer
BASELINE II, INC.
By /s/ Xxx Xxxxx
--------------------------------------------
Name: Xxx Xxxxx
Title:
XXXX XXXXX ASSOCIATES, INC.
By /s/ Xxxx Xxxxx
--------------------------------------------
Name: Xxxx Xxxxx
Title:
By /s/ Xxxx Xxxxx
--------------------------------------------
Xxxx Xxxxx
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