Exhibit 10.9
VENTURE ▇▇▇▇▇▇▇▇.▇▇▇
a Division of
INLAND ENTERTAINMENT CORPORATION
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▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
July 30, 1999
Ms. ▇▇▇▇▇▇▇ ▇▇▇▇▇
Chief Executive Officer
Entertainment Blvd.
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Dear ▇▇▇▇▇:
This letter agreement (the "Agreement") confirms the terms and
conditions of the engagement of Venture ▇▇▇▇▇▇▇▇.▇▇▇, a Division of Inland
Entertainment Corporation ("Venture Catalyst"), by Entertainment Blvd. (the
"Company") to render certain investor relations and financial communications
services to the Company which are referred to herein.
1. SERVICES. Venture Catalyst agrees to perform investor relations
services for the Company which are ordinarily and customarily performed by an
investor relations firm on behalf of a corporate client. These services
include, but are not limited to, (a) review of the non-financial portions of
quarterly and annual reports sent to securityholders by the Company,
exclusive of any current, quarterly or annual reports filed with U.S.
Securities and Exchange Commission and/or other regulatory agencies; (b)
drafting and distribution of financial and general press releases; (c)
drafting of a corporate profile for distribution to the Company's
shareholders and the public; and (d) introduction of the Company to the
financial brokerage community.
2. NON-EXCLUSIVE RELATIONSHIP, NO GUARANTEE. Venture Catalyst will act
as a non-exclusive agent of the Company and shall use its best efforts in the
performance of its services described above. Nothing in this Agreement shall
be construed as limiting Venture Catalyst's right to represent other clients,
except that Venture Catalyst agrees not to represent any other person or
entity which is in direct competition with the Company unless Venture
Catalyst first obtains the Company's written consent, which shall not be
unreasonably withheld.
3. FEES. The Company shall pay to Venture Catalyst for its services a
monthly fee of $5,000 per month. The initial monthly payment shall be due
upon your execution of this Agreement; thereafter, the monthly fee shall be
due and payable on or before the first day of each month.
4. EXPENSES. In addition to any fees that may be payable hereunder, the
Company agrees, from time to time upon request, to reimburse Venture Catalyst
for all reasonable out of pocket expenses incurred by it in the performance
of services on behalf of the Company. Such out of pocket expenses shall
include, but are not limited to, costs of long-distance telephone charges,
facsimile services, mileage/travel, messenger services, printing, copying,
postage, and other such ancillary services. It is understood by Venture
Catalyst, however, that any single expense in excess of $200.00 will be
approved, in advance by the Company in writing. Any disputed
Mr. ▇▇▇▇▇▇▇ ▇▇▇▇▇
Entertainment Blvd.
July 30, 199
Page 2
expense must be made known to Venture Catalyst in writing within 5 days of
receipt. Out of pocket expenses will be billed on or about the fifteenth of
each month and will be due and payable with 10 days of receipt.
5. EQUITY PARTICIPATION. As an inducement for Venture Catalyst to enter
into this Agreement, the Company agrees to grant to Inland Entertainment
Corporation or its successor or designatee within 5 business days of the date
of this Agreement an option (the "Option") to purchase 50,000 shares of the
Company's common stock (the "Shares") at an exercise price of $6.00 per share.
Such number of shares of common stock and the related exercise price shall be
subject to customary protection adjustment provisions for the optionee. The
Option shall be immediately exercisable in whole or in part and shall expire
on August 2, 2002. Termination of Venture Catalyst's engagement hereunder
shall not effect the Option or the provisions of this Section 5 which shall
survive such termination. To the extent legally permissible, the Company
shall register the Shares on a registration statement on SEC Form S-8 or its
successor form. If not legally permissible, the Company shall include the
Shares with any of the Company's securities it determines to register for its
own account at any time, subject only, in an underwritten public offering, to
such customary limitations which such underwriter may impose based upon its
determination that marketing factors require a limitation on the number of
shares to be underwritten (the "Piggy Back Rights"). The Piggy Back Rights
shall not apply from time to time, if, at the time such holder desires to
sell any of the Shares, the holder of the Shares (together with its
affiliates) is able to sell all such Shares remaining pursuant to Rule 144
promulgated under the Securities Act of 1933, as amended. The Piggy Back
Rights shall continue until all the Shares are registered and sold.
6. TERMINATION OF THE ENGAGEMENT. Venture Catalyst's engagement
hereunder may be terminated by either the Company or Venture Catalyst at any
time, with or without cause, upon written advice to that effect to the other
party; PROVIDED, HOWEVER, that Venture Catalyst will be entitled to (a) its
full fee for the month of August 1999 under Section 3 hereof regardless of
when this Agreement is terminated if terminated by the Company; (b) its
pro-rated fee for (i) months after August 1999 and (ii) if terminated during
the month of August 1999 by Venture Catalyst, August 1999; and PROVIDED
FURTHER, that the provisions of this Section 6 and Sections 4, 5 and 7 hereof
shall survive such termination.
7. INDEMNITY.
(a) INDEMNIFICATION BY THE COMPANY. In connection with Venture
Catalyst's engagement hereunder, including modifications of future additions
to this engagement and the related activities prior to this date, the Company
agrees that it will indemnify, hold harmless and defend Venture Catalyst and
its affiliates, any director, officer, agent or employee of Venture Catalyst
or any of its affiliates and each other person, if any, controlling Venture
Catalyst or any of its affiliates and each of their successors and assigns
(collectively, the "VC Group") against and in respect of any and all losses,
damages, claims, obligations, demands, actions, suits, proceedings,
assessments, liabilities, judgments, recoveries and deficiencies, costs and
expenses (including, without limitation, reasonable attorneys' fees and costs
and expenses incurred in investigating, preparing, defending against or
prosecuting any litigation, claim, proceeding or demand), all on an after-tax
basis, less any amounts actually paid as insurance reimbursement, of any kind
or character (collectively, a "Loss"), (i) related to, arising out of or
result from (A) oral or written information provided by the Company, the
Company's employees or the Company's other agents, for use by Venture
Catalyst in connection with Venture Catalyst's performance of services under
this Agreement; (B) other action or failure to act by the Company, the
Company's employees or the Company's other agents or by Venture Catalyst at
the Company's request or with the Company's consent or (C)
Mr. ▇▇▇▇▇▇▇ ▇▇▇▇▇
Entertainment Blvd.
July 30, 1999
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any breach of, or failure by the Company to fully perform, or any inaccuracy
in, any of the representations, warranties, covenants or agreements of the
Company in this Agreement or (ii) otherwise related to or arising out of the
engagement of Venture Catalyst pursuant to this Agreement or any transaction
or conduct in connection therewith except that this clause (ii) and clause
(i)(B) relating to actions by Venture Catalyst, shall not apply with respect
to any losses that are finally judicially determined to have resulted
primarily from Venture Catalyst's bad faith or gross negligence.
(b) NOTICE OF CLAIM. Whenever Venture Catalyst learns of or
discovers any matter which may give rise to a claim for indemnification (the
"Claim") against the Company under this Section 7 (the "Indemnity Obligor"),
as the indemnified party (the "Indemnified Party"), shall give notice to the
Indemnity Obligor of the Claim. With respect to Claims which are the subject
of actions, suits, or proceedings threatened or asserted in writing by any
third party (a "Third Party Claim"), the Indemnified Party shall, within 15
days following receipt of such Third Party Claim, promptly notify the
Indemnity Obligor in writing of any Claim for recovery, specifying in
reasonable detail the nature of the Loss and the amount of the liability
estimated to arise therefrom. If the Indemnified Party does not so notify the
Indemnity Obligor within 15 days of its discovery of a Third Party Claim,
such Claim shall be barred only to the extent that the Indemnity Obligor is
prejudiced by such failure to notify. The Indemnified Party shall provide to
the Indemnity Obligor as promptly as practicable thereafter all information
and documentation reasonably requested by the Indemnity Obligor to verify the
Claim asserted.
(c) DEFENSE. If the facts relating to a Loss arise out a Third Party
Claim, or if there is any claim against a third party available by virtue of
the circumstances of the Loss, the Indemnity Obligor shall, by giving written
notice to the Indemnified Party within 15 days following its receipt of the
notice of such claim, assume the defense or the prosecution thereof,
including the employment of counsel or accountants, reasonably satisfactory
to the Indemnified Party, at its cost and expense; PROVIDED, HOWEVER that
during the interim the Indemnified Party shall use its best efforts to take
all action (not including settlement) reasonably necessary to protect against
further damage or loss with respect to the Loss. The Indemnified Party shall
have the right to employ counsel separate from counsel employed by the
Indemnity Obligor in any such action and to participate therein, but the fees
and expenses of such counsel shall be at the Indemnified Party's own expense,
unless (a) the employment thereof has been specifically authorized by the
Indemnity Obligor, (b) such Indemnified Party has been advised by counsel
reasonably satisfactory to the Indemnity Obligor that there may be one or
more legal defenses available to it which are different from or additional to
those available to the Indemnity Obligor and in the reasonable judgment of
such counsel it is advisable for such Indemnified Party to employ separate
counsel, or (c) the Indemnity Obligor has failed to assume the defense of such
action and employ counsel reasonably satisfactory to the Indemnified Party.
Whether or not the Indemnity Obligor defends or prosecutes such claim, all
the parties hereto shall cooperate in the defense or prosecution thereof and
shall furnish such records, information and testimony and shall attend such
conferences, discovery proceedings and trial as may be reasonably requested
in connection therewith. The Indemnity Obligor shall not be liable for any
settlement of any such claim effected without its prior written consent. In
the event of payment by the Indemnity Obligor to the Indemnified Party in
connection with any Loss arising out of a Third Party Claim, the Indemnity
Obligor shall be subrogated to and shall stand in the place of the
Indemnified Party as to any events or circumstances in respect of which the
Indemnified Party may have any right or claim against such third party
relating to such indemnified matter. The Indemnified Party shall cooperate
with the Indemnity Obligor in prosecuting any subrogated claim. The
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July 30, 1999
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Indemnity Obligor will take no action in connection with any claim that would
adversely affect the Indemnified Party without the consent of the Indemnified
Party.
(d) DURATION OF THE COMPANY'S OBLIGATIONS. The Indemnity Obligor's
indemnification obligations under this Agreement shall survive the
termination of this Agreement.
8. ACKNOWLEDGMENTS AND REPRESENTATIONS.
(a) The Company recognizes and confirms that in performing its
duties pursuant to this Agreement, Venture Catalyst will be using and relying
upon data, material and other information furnished by the Company, its
employees and representatives (the "Information"). The Company hereby agrees
and represents that all Information furnished to Venture Catalyst in
connection with this Agreement shall be accurate and complete in all material
respects at the time furnished, and that if such Information, in whole or
part, becomes materially inaccurate, misleading or incomplete during the term
of Venture Catalyst's engagement hereunder, the Company shall so advise
Venture Catalyst in writing and correct any such inaccuracy or omission.
Venture Catalyst assumes no responsibility for the accuracy and completeness
of such Information. In rendering its services hereunder, Venture Catalyst
shall be entitled to use and rely upon the Information without independent
verification thereof. To the extent consistent with legal requirements, all
Information, unless publicly available or otherwise available to Venture
Catalyst without restriction or breach of any confidentiality agreement, will
be held by Venture Catalyst in confidence and will not be disclosed to anyone
other than Venture Catalyst's agents and advisors without the Company's prior
written approval or used for any purpose other than those referred to in
this Agreement.
(b) The Company understands and agrees that in furnishing the
Company with advice and other services as provided in this Agreement, neither
Venture Catalyst nor any officer, director or agent thereof shall be liable
to the Company, its affiliates or its creditors for errors of judgment or
anything except bad faith or gross negligence in the performance of its
duties under the terms of this Agreement.
(c) The Company acknowledges that Venture Catalyst has been retained
solely as an advisor to the Company, and not as an advisor to or agent of any
other person, and that the Company's engagement of Venture Catalyst is not
intended to confer rights upon any persons not a party hereto (including
shareholders, employees or creditors of the Company) as against Venture
Catalyst, Venture Catalyst's affiliates or their respective directors,
officers, agents and employees.
(d) The Company represents and warrants to Venture Catalyst that it
will not cause, or knowingly permit(a) any action to be taken which violates
or (b) a failure to act, the effect of which violates, any federal or state
securities law.
9. NOTICES. All notices, requests, consents and other communications
under this Agreement shall be in writing and shall be delivered by hand or
fax or mailed by overnight courier or first class certified or registered
mail, return receipt requested, postage prepaid and proper addressed as
follows:
If to Venture Catalyst, at Venture ▇▇▇▇▇▇▇▇.▇▇▇, a Division of
Inland Entertainment Corporation, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: President. If to the
Mr. ▇▇▇▇▇▇▇ ▇▇▇▇▇
Entertainment Blvd.
July 30, 1999
Page 5
Company, at Entertainment Blvd., ▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Chief Executive Officer.
Any party may change its address for purposes of this provision by
giving the other party written notice of the new address in the manner set
forth above. Notice will be conclusively deemed to have been given when
personally delivered, or if given by mail, on the second day after being sent
by overnight courier or on the third day after being sent by first class,
registered or certified mail, or if given by fax, when confirmation of
transmission is indicated by the sender's fax machine.
10. ARBITRATION. All controversies, disputes or claims arising out of
or relating to this Agreement shall be resolved by binding arbitration. The
arbitration shall be conducted in accordance with the Commercial Arbitration
Rules of the American Arbitration Association. All arbitrators shall possess
such experience in, and knowledge of, the subject area of the controversy or
claim so as to qualify as an "expert" with respect to such subject matter.
The governing law for the purposes of any arbitration arising hereunder shall
be as set forth in Section 11 hereof. The prevailing party shall be entitled
to receive its reasonable attorney's fees and all costs relating to the
arbitration. Any award rendered by arbitration shall be final and binding on
the parties, and judgment thereon may be entered in any court of competent
jurisdiction.
11. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the state of California, without regard to the
conflicts of laws provisions thereof, and may not be amended or modified
except in writing signed by both parties.
12. SUCCESSORS. This Agreement and all rights and obligations
thereunder shall be binding upon and inure to the benefit of each party's
successors, but may not be assigned without the prior written consent of the
other party, which shall not be unreasonably withheld or delayed.
13. SEVERABILITY. If any provision of this Agreement shall be held or
made invalid by a statute, rule, regulation, decision of a tribunal or
otherwise, the remainder of this Agreement shall not be affected thereby and,
to this extent, the provisions of this Agreement shall be deemed severable.
14. AUTHORIZATION. The Company represents and warrants that it has all
requisite power and authority, and has received all necessary authorizations,
to enter into and carry out the terms and provisions of this Agreement.
Please confirm that the foregoing correctly sets forth our
Agreement by signing the enclosed letter in the space provided and returning
them to us for execution, whereupon we will send you a fully executed
original letter which shall constitute a binding Agreement as of the date
first above written. We look forward to working with you on this assignment.
Very truly yours,
VENTURE ▇▇▇▇▇▇▇▇.▇▇▇,
a Division of Inland Entertainment Corporation
Mr. ▇▇▇▇▇▇▇ ▇▇▇▇▇
Entertainment Blvd.
July 30, 1999
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By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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President
Agreed to and Accepted as of the date above.
ENTERTAINMENT BLVD.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
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Chief Executive Officer
