This PURCHASE AND SALE AGREEMENT (this "Agreement") is
made and entered into as of September 23, 1997, by and between
Cinema Plus, L.P., a Delaware limited partnership ("Seller"), and
Home Box Office, a division of Time Warner Entertainment Company,
L.P. ("Buyer") (initially capitalized terms not otherwise defined
in the body of this Agreement shall have the meaning set forth on
Schedule A hereto).
R E C I T A L S
A. WHEREAS, Seller owns all right, title and interest
with respect to the motion pictures listed on Exhibit A hereto
(the "Pictures").
B. WHEREAS, Buyer is willing to purchase all of
Seller's right, title and interest in, to and under the Pictures,
and Seller is willing to sell such right, title and interest, all
on the terms and conditions set forth herein.
NOW, THEREFORE, based on the above premises and in
consideration of the mutual covenants and agreements contained
herein, the parties agree as follows:
1. Agreement to Purchase and Sell.
1.1 Acquisition. On the terms and subject to the
conditions of this Agreement, on the Closing Date, Seller shall
sell to Buyer, and Buyer shall purchase from Seller, the
following assets (collectively, the "Assets"):
(a) All of Seller's right, title and interest of
every kind and nature whatsoever in, to and under the
Pictures and the Film Assets, including, without limitation:
(i) Subject only to the Existing Third
Party Exploitation Rights, the sole and exclusive
right, commencing on the Closing Date, to Exploit the
Pictures and the Film Assets, including without
limitation the right to exercise all Exploitation
rights in and to the Pictures and the Film Assets;
(ii) All Physical Properties;
(iii) All rights and remedies
(including, without limitation, the benefit of all
representations, warranties, indemnifications and other
covenants) under the Existing Exploitation Agreements
and all other agreements with respect to the Assets,
including, without limitation, all accounts receivable,
rights to payment, proceeds, claims (including audit
claims whether arising prior to or subsequent to the
Closing Date), recoveries or consideration of any
nature whatsoever ("Accounts Receivable") paid or
payable on or after the Closing Date pursuant to the
Existing Exploitation Agreements and all other
agreements with respect to the Assets; and
(b) All Books and Records.
1.2 Closing. The closing (the "Closing") of the
Transaction will take place at the offices of O'Melveny & ▇▇▇▇▇
LLP, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, on September 24, 1997, or at such earlier time and place
as to which the parties agree (the "Closing Date").
1.3 Transfer. At the Closing, Seller shall transfer
the Assets to Buyer in accordance with this Agreement.
1.4 Sales Tax. Buyer shall be responsible for all
sales, use, transfer, stamp and similar taxes incurred as a
result of this Agreement and the consummation of the Transaction.
2. Consideration. The consideration for the sale by
Seller to Buyer of the Assets shall be as follows:
2.1 Cash Payment. Buyer shall pay Seller Four Hundred
Fifty-Five Thousand Two Hundred Sixty-Four Dollars ($455,264.00)
at the Closing by wire or other transfer of immediately available
funds to an account designated by Seller.
2.2 Assumption of Certain Obligations. Buyer will
assume, pay and perform all of the obligations and liabilities of
Seller arising in connection with the Assets.
2.3 Payment of Receivables. Seller agrees that if it
receives any payments which are intended to be included in the
Assets purchased by Buyer hereunder, Seller shall promptly remit
such amounts to Buyer.
3. Representations and Warranties of Seller. As an
inducement for Buyer to enter into this Agreement, Seller
represents and warrants that each of the following statements is
true and correct as of the date hereof and on the Closing Date:
3.1 Existence and Rights. Seller (i) is a limited
partnership duly organized and validly existing in good standing
under the laws of the State of Delaware and (ii) has the power
and authority, licenses and rights to own its properties, to
carry on its business as now conducted and to make and carry out
the Transaction.
3.2 Agreement Authorized. The execution, delivery and
performance of this Agreement by Seller and the Related
Agreements, to which Seller is a party, by Seller has been duly
authorized by all necessary action on the part of Seller and does
not require notice to, or the consent or approval of, any
governmental or other regulatory authority or any other Person.
Each of this Agreement and the Related Agreements to which Seller
is a party has been or when delivered at Closing will have been
duly executed and delivered by Seller and is or will be a legal,
valid and binding obligation of Seller enforceable in accordance
with its terms, except to the extent limited by bankruptcy,
insolvency, reorganization, receivership, moratorium and other
similar laws affecting the rights and remedies of creditors
generally.
3.3 No Conflict. The execution, delivery and
performance by Seller of this Agreement and the Related
Agreements will not (i) breach or constitute grounds for the
occurrence or declaration of a default under or allow another
party a right to terminate, accelerate or cancel any material
agreement, indenture, undertaking or other instrument to which
Seller is a party or by which Seller or any of the Assets may be
bound or materially affected; (ii) violate any provision of law
or any regulation or any order, judgment, or decree of any court
or other agency or government; (iii) violate any provision of the
organizational documents of Seller; or (iv) result in the
creation or imposition of (or the obligation to create or impose)
any lien, charge or encumbrance on, or security interest in, any
of the Assets, other than as contemplated by the Transaction.
3.4 Ownership. To the best of Seller's knowledge,
Seller is the sole and exclusive owner of all the Assets. To the
best of Seller's knowledge, Seller owns all rights to Exploit the
Pictures subject only to the Existing Exploitation Agreements.
There are no agreements affecting the Assets except for the
Existing Exploitation Agreements and other agreements listed on
Exhibit B ("Specified Contracts"), true, correct and complete
copies of all of which (including amendments, if any) have been
provided to Buyer. To the best of Seller's knowledge, the
Specified Contracts are fully executed, have been performed as
required on or prior to the date hereof in all material respects,
are in full force and effect and shall remain in full force and
effect after the Closing enforceable in accordance with their
terms, except to the extent limited by bankruptcy, insolvency,
reorganization, receivership, moratorium and other similar laws
affecting the rights and remedies of creditors generally, and
there are no defaults, nor have there been any defaults, under
any of the Specified Contracts. All information set forth on
Exhibit B is true, correct and complete in all respects with
regard to the information that it is purporting to show, and,
except as set forth on Exhibit B, from and after the date hereof
there has been no other distribution or exploitation right or
other license or right granted to any Person with respect to the
Pictures nor any other agreement or contract entered into with
respect to the Assets.
3.5 Rights Unimpaired. Except for the rights under
the Existing Exploitation Agreements, to the best of Seller's
knowledge, Seller has not done, nor authorized to be done, any
act or thing by which any Exploitation of the Film Assets have
been or will be in any way adversely affected or impaired.
3.6 Non-Infringement and Litigation. To the best of
Seller's knowledge, neither the Film Assets nor any portion
thereof (including the Pictures and the sound synchronization
thereof) nor the exercise of any rights to Exploit the Film
Assets, will violate or infringe upon the trademark, trade name,
copyright, patent, or any literary, dramatic, musical, artistic,
or personal right or any right of privacy, publicity, property
right or any other right of any Person or entity or constitute
unfair competition or defame any Person or entity. Seller has
provided Buyer with notice of and, if requested by Buyer, with
copies of any and all papers, documents and pleadings served or
delivered to Seller or any of its Affiliates regarding any
claims, actions or litigations, either threatened, pending or
concluded, that might reasonably be expected to adversely affect
any of the Assets.
3.7 Clearance. To the best of Seller's knowledge,
Seller has obtained proper and effective licenses or grants of
authority to use the results of the services of performers and
other persons connected with the production of the Pictures to
the extent reasonably necessary or desirable to exercise the
rights to the Assets (which licenses and grants will be
transferred by Seller to Buyer at the Closing).
3.8 Bankruptcy; Liens/Encumbrances. Seller has not
become subject to voluntary or involuntary bankruptcy
proceedings. There are no liens, encumbrances or claims on the
Assets or any portion thereof or upon any revenues or receivables
from the Exploitation of the Film Assets.
3.9 Music. To the best of Seller's knowledge, all non-
dramatic music rights (so called "small rights") contained in the
Pictures are (i) available by license from American Society for
Composers, Authors and Publishers ("ASCAP"), Broadcast Music Inc.
("BMI") or SESAC, Inc. or (ii) in the public domain, or
(iii) controlled by Seller directly or through licenses (in which
event Seller hereby transfers all such licenses to Buyer).
3.10 Insurance Claims. To the best of Seller's
knowledge, no insurance claims have been made and are currently
outstanding and unsettled as of the date of this Agreement on the
producer's errors and omissions policies or any other insurance
policies that Seller maintained with respect to the Pictures. No
claim with respect to any of the Pictures under any producer or
Seller errors and omissions policy has required a payment of more
than $5,000 by the insurance company or Seller.
3.11 Contingencies. To the best of Seller's knowledge,
(i) there is no litigation, arbitration, other proceeding,
written audit request or, to the knowledge of Seller,
investigation, pending against Seller, or any of their respective
partners, officers or directors (in their capacities as such)
which in any way adversely affect any of the Assets, and
(ii) Seller does not know of any threats of, or believe there is
a reasonable basis for, any such litigation, arbitration, other
proceedings or written audit requests, the results of which could
reasonably be expected to have, individually or in the aggregate,
an adverse effect on the Assets.
3.12 Compliance with Law. Seller has conducted and is
conducting its business in compliance with all applicable laws
and regulations in all material respects and has obtained all
necessary licenses, permits and other approvals of any
governmental authority.
3.13 Guild Obligations; Participations. There are no
Guild agreements or Guild or Participation Obligations payable
with respect to any of the Pictures other than those set forth on
Schedule 3.13. There are no Guild Obligations payable with
respect to any of the Pictures in excess of the minimum amounts
payable under any applicable and binding collective bargaining
agreement. Seller has complied with all union and Guild
regulations and collective bargaining agreements applicable to
the Pictures.
3.14 Commissions. Neither Seller nor any of their
respective partners, officers, directors, agents or employees
have employed or incurred any liability to any broker, finder or
agent for any brokerage fees, finder's fees, commissions or other
similar payments with respect to the Transaction.
3.15 Accuracy of Information Furnished. No statement
or information contained in any schedule, certificate or other
document or information furnished, or to be furnished, in writing
by or on behalf of Seller to Buyer contains or will contain any
untrue statement of a material fact. Seller is not aware of any
facts or circumstances not fully disclosed in this Agreement or
the exhibits or schedules hereto which should be disclosed to
Buyer in order to make any of the representations or warranties
made by Seller herein not misleading in light of the
circumstances under which they were made.
4. Representations and Warranties of Buyer. As an
inducement for Seller to enter into this Agreement, Buyer hereby
represents and warrants that each of the following statements is
true and correct as of the date hereof:
4.1 Existence and Rights. Buyer (i) is a limited
partnership duly organized and validly existing in good standing
under the laws of the State of Delaware, without limit as to the
duration of its existence; and (ii) has the power and adequate
authority, licenses and rights to own its properties, to carry on
its business as now conducted and to make and carry out the
Transaction.
4.2 Agreement Authorized. The execution, delivery and
performance of this Agreement and the Related Agreements to which
Buyer is a party by Buyer, has been duly authorized by all
necessary action and does not require notice to, or the consent
or approval of, any governmental or other regulatory authority or
any other Person. This Agreement has been duly executed and
delivered by Buyer and is a legal, valid and binding obligation
of Buyer enforceable in accordance with its terms, except to the
extent limited by bankruptcy, insolvency, reorganization,
receivership, moratorium and other similar laws affecting the
rights and remedies of creditors generally. The Related
Agreements to which Buyer is a party, when delivered at Closing,
will have been duly executed and delivered by Buyer and will be
legal, valid and binding obligations of Buyer, enforceable in
accordance with each of their respective terms, except to the
extent limited by bankruptcy, insolvency, reorganization,
receivership, moratorium and other similar laws affecting the
rights and remedies of creditors generally.
4.3 No Conflict. The execution, delivery and
performance of this Agreement by Buyer will not (i) violate any
provision of law or any regulation or any order, judgment, or
decree of any court or other agency or government; or
(ii) violate any provision of the organizational documents of
Buyer.
4.4 Commissions. Neither Buyer nor any of its
officers, directors, agents or employees have employed or
incurred any liability to any broker, finder or agent for any
brokerage fees, finder's fees, commissions or other similar
payments with respect to the Transaction.
5. Covenants of Seller.
5.1 Conduct of Business Prior to Closing. Seller
agrees that until the Closing Date, unless Buyer otherwise
consents in writing and except for the Transaction, it will:
(a) Not offer, license or sell or agree to offer,
license or sell any rights or property, (tangible or
intangible) which are included in the Assets or modify,
amend, terminate, rescind or cancel any existing agreements
(including without limitation any Existing Exploitation
Agreements) with respect to the Assets or expand any rights
or property (tangible or intangible) with respect to the
Assets granted to any Person or accelerate the time for
payments of any amounts owing to Seller under any such
agreements;
(b) Promptly notify Buyer with respect to the
receipt of any notice of the type described in Section 3.6;
(c) Use reasonable efforts to preserve the
goodwill of third parties having business relations with it;
(d) Not enter into any Exploitation Agreements
relating to the Exploitation of any Film Assets;
(e) Not transfer or encumber or agree to transfer
or encumber any of the Assets in any way, except as
specifically permitted herein; and
(f) Maintain its books and records in accordance
with past practices and policies, except for such changes of
which it will advise Buyer as are required to comply with
generally accepted accounting principles or applicable law.
5.2 Representations True. Until the Closing Date,
Seller will perform such acts as may be necessary or appropriate
to make all of its representations and warranties set forth in
this Agreement true and correct on and as of the Closing Date.
Seller will inform Buyer promptly upon discovery that any of its
representations or warranties ceases to be true or correct.
5.3 Access. Until the Closing Date, Seller will
(i) upon reasonable prior notice permit Buyer and its authorized
representatives and agents to have access during normal business
hours to all contracts, accounting books and records and
documents relevant to the Assets or the Transaction, and to make
extracts from and copies of such contracts, books and records and
documents, subject only to third party confidentiality rights
(and Seller shall use all reasonable efforts to obtain as soon as
possible waivers by such third parties to permit such access),
(ii) furnish to Buyer or its authorized representatives and
agents such other information with respect to the business or
properties of Seller as Buyer may from time to time reasonably
request, (iii) otherwise reasonably cooperate in the examination
or audit of Seller by Buyer and (iv) confer with Buyer to keep it
informed with respect to operational matters of a material nature
and to report on the general status of the business of Seller
except to the extent restricted by confidentiality obligations to
third parties that are not Affiliates of Seller.
5.4 Permits. Seller will make all filings with
governmental bodies and other regulatory authorities and use
reasonable efforts to obtain all permits, approvals,
authorizations and consents of all third parties necessary for
Seller to consummate the Transaction (including without
limitation, consents of any guarantor) without being in violation
of any law or otherwise adversely affecting any of the Assets.
5.5 Physical Properties. Seller will transfer legal
ownership to Buyer in and to all Physical Properties owned by
Seller ("Owned Elements") on the Closing Date. With respect to
the Owned Elements, Seller shall deliver to Buyer agreements
substantially in the form of Exhibit 5.5(a) ("Lab Notices")
executed by Seller pursuant to which Seller acknowledges that as
of the Closing Date, legal ownership and title to the applicable
Physical Property has been conveyed to Buyer. Seller will
transfer to Buyer all of Seller's rights of access to and use of
all Physical Properties which Seller has in and to Physical
Properties not owned by Seller relating to the Pictures ("Access
Picture Properties"). With respect to Access Picture Properties,
if any, upon request of Buyer, Seller shall deliver to Buyer
agreements substantially in the form of Exhibit 5.5(b) ("Access
Notices") executed by Seller pursuant to which Seller
acknowledges that as of the Closing Date, all of Seller's access
rights to the applicable Access Picture Properties has been
conveyed to Buyer. Prior to and following the Closing, Seller
agrees to assist Buyer, as needed, in obtaining possession of any
Physical Properties transferred to Buyer hereunder.
5.6 Delivery of Books and Records. As soon as
possible after the Closing, to the extent available and to the
extent Seller has not theretofore done so, Seller shall deliver
to a location specified by Buyer original copies of all of
Seller's Books and Records including without limitation all
contracts referred to on Exhibit B hereto.
5.7 Account Notices. As soon as reasonably possible
after the Closing, Seller shall execute and deliver to Buyer
notices to all account debtors pursuant to the Existing
Exploitation Agreements or any other agreement listed on
Exhibit B in the form attached hereto as Exhibit 5.7 ("Account
Notices").
5.8 Performance of Obligations. Seller will pay and
perform all obligations and liabilities of Seller relating to the
Assets which arise prior to the Closing Date, except for
obligations and liabilities which are specifically assumed
hereunder by Buyer.
5.9 Good Faith Efforts. Seller shall use its best
efforts to effect the Closing.
5.10 Related Agreements. At the Closing, Seller will
execute and deliver each of the Related Agreements and the
closing documents to which it is a party.
6. Covenants of Buyer.
6.1 Representations True. Until the Closing Date,
Buyer will perform such acts as may be necessary or appropriate
to make all of its representations and warranties set forth in
this Agreement true and correct on and as of the Closing Date.
Buyer will inform Seller promptly upon discovery that any of its
representations or warranties ceases to be true or correct.
6.2 Permits. Buyer will make all filings with
governmental bodies and other regulatory authorities and use
reasonable efforts to obtain all permits, approvals,
authorizations and consents of all third parties necessary for
Buyer to consummate the Transaction (including without
limitation, consents of any guarantor) without being in violation
of any law or otherwise adversely affecting any of the Assets.
6.3 Good Faith Efforts. Seller shall use its best
efforts to effect the Closing.
6.4 Guild Assumption Agreements. At the Closing,
Buyer shall enter into the Guild Assumption Agreements with the
applicable Guilds pursuant to which Buyer shall have assumed
Seller's Guild Obligations (the "Guild Assumption Agreements").
The Guild Assumption Agreements shall be in the form required
under the applicable collective bargaining agreement or in such
other form acceptable to the Guilds and Buyer.
7. Conditions Precedent to Obligations of Buyer. The
obligations of Buyer to consummate this Agreement and the
Transaction are subject to the fulfillment, prior to or as of the
Closing Date, of the following conditions, each of which may be
waived by Buyer in writing:
7.1 Representations and Warranties. The
representations and warranties of Seller contained in Section 3
shall be true and correct in all material respects at and as of
the Closing Date.
7.2 Covenants. Seller shall have complied in all
material respects with all covenants contained herein to be
complied with by it prior to or at the Closing.
7.3 No Injunction or Litigation. Buyer shall not be
prohibited by any order, ruling, consent, decree, judgment or
injunction of a court or regulatory agency of competent
jurisdiction from consummating the Transaction. No litigation,
claim, action, investigation or proceeding instituted by any
governmental body or other regulatory authority or any other
Person shall be pending to restrain, delay or invalidate any part
of the Transaction.
7.4 Consents Obtained. Seller shall have obtained all
of the consents and approvals required for the execution,
delivery and performance of this Agreement by it, including,
without limitation, consents of any guarantor with respect to,
and consents required under the terms of, any Existing
Exploitation Agreement or any other agreement listed in
Exhibit B.
7.5 Assignment of Copyright. Seller shall have
executed and delivered to Buyer Assignments of Copyright in form
and substance satisfactory to Buyer relating to all copyrights
and rights and interests in copyrights domestic and foreign
included in the Film Assets substantially in the form attached
hereto as Exhibit 7.5.
7.6 Related Agreements. The Related Agreements shall
have been executed and delivered by Seller and its Affiliates as
applicable.
7.7 ▇▇▇▇ of Sale. Seller shall have executed and
delivered to Buyer a ▇▇▇▇ of Sale substantially in the form
attached hereto as Exhibit 7.7.
7.8 Assignment of Insurance Policies. Seller shall
have executed and delivered, and shall have caused required third
parties to execute and deliver, any and all documents necessary
or appropriate to assign Seller's insurance policies to Buyer.
7.9 Notices; Documentation. Seller shall have
executed and delivered to Buyer (i) Lab Notices to all
laboratories or storage facilities holding any Owned Elements of
the transfer of legal title in all Owned Elements to Buyer in the
form attached hereto as Exhibit 5.5(a); (ii) all documentation
required to effectuate Buyer's interests in all musical
compositions with the applicable performing rights societies; and
(iii) all documentation required to assign any security interests
held by Seller to Buyer.
7.10 Outstanding Accounts Receivable. Seller shall
have delivered to Buyer a list of all Accounts Receivable which
shall be true and correct in all material respects.
7.11 No Adverse Changes. During the period commencing
on the date hereof and ending on the Closing Date, there shall
not have been any material adverse change in the Seller and the
Assets.
7.12 Closing Documents. Seller shall have executed and
delivered each of the Related Agreements and each and every other
document required to be delivered at the Closing as set forth in
this Agreement, each in form and substance satisfactory to Buyer
and Buyer's counsel.
7.13 Further Assurances. Seller shall have executed
and delivered, and shall have caused all third parties to execute
and deliver, any and all documents necessary or appropriate to
transfer title in the Assets to Buyer and to confirm Buyer's
ownership rights in and to the Assets.
8. Termination.
8.1 Grounds for Termination. This Agreement may be
terminated at any time prior to the Closing Date and not
thereafter (i) by mutual written consent of Buyer and Seller,
(ii) by either Buyer or Seller if there has been a material
breach of the representations, warranties or covenants of the
other party set forth herein or (iii) by Buyer if the conditions
stated in Section 7 cannot be or have not been satisfied in all
material respects by the Closing Date.
8.2 Effect of Termination. If this Agreement is
terminated as provided in Section 8.1, all obligations of the
parties hereunder will terminate without liability of any party
to any other party, except (i) that the obligations set forth in
Sections 9.2 and 9.5 will survive any such termination and
(ii) that Seller will be liable for Losses incurred by Buyer
caused by and resulting from any breach by Seller of the
covenants contained in Section 5.
8.3 Rights to Proceed. Subject to Section 8.1, if any
of the conditions specified in Section 6 have not been satisfied,
Buyer will have the right to proceed with the Transaction without
waiving any of its rights hereunder to seek damages for any
breach of a representation, warranty or covenant.
8.4 Specific Performance. The Assets are uniquely
suited for the purposes and needs of Buyer. If Seller should
breach any of its representations, warranties or covenants under
this Agreement, the parties each acknowledge that the remedy at
law would be inadequate to compensate Buyer. Accordingly, Buyer,
in addition to any other available rights or remedies, may at its
sole option ▇▇▇ in equity for specific performance, and Seller
expressly waives the defense that a remedy in damages will be
adequate. Notwithstanding the foregoing, Buyer shall not be
entitled to specific performance hereunder unless and until it
has tendered all amounts due pursuant to Section 2.
8.5 Survival of Representations and Warranties. The
representations and warranties contained herein shall survive the
Closing and any investigation or due diligence conducted by the
parties, including without limitation any claims or notices
received from third parties, and Buyer may recover any damages
for breach of representation and warranty from Seller.
9. Miscellaneous.
9.1 Complete Agreement; Modifications. This
Agreement, and any documents referred to herein or executed
contemporaneously herewith, constitute the parties' entire
agreement with respect to the subject matter hereof and supersede
all agreements, representations, warranties, statements, promises
and understandings, whether oral or written, with respect to the
subject matter hereof. This Agreement may not be amended, altered
or modified except by a writing signed by the parties.
9.2 Expenses. The parties hereto will each pay all of
their own expenses incurred in connection with the authorization,
preparation, execution and performance of this Agreement and the
Transaction, including, without limitation, all fees and expenses
of their respective agents, representatives, counsel and
accountants.
9.3 Remedies Not Exclusive. No remedy conferred by
any of the specific provisions of this Agreement is intended to
be exclusive of any other remedy, and each and every remedy will
be cumulative and will be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by
statute or otherwise. The election of any one or more remedies
will not constitute a waiver of the right to pursue other
available remedies.
9.4 Cooperation. Each party hereto agrees, both
before and after the Closing, to execute any and all further
documents and writings and perform such other reasonable actions
which may be or become reasonably necessary or expedient to
effectuate and carry out the Transaction (which shall include any
obligation to make payments). If at any time after the Closing,
Seller receives any payment with respect to the Assets, it will
hold such payment in trust and pay it to Buyer within five (5)
business days of its receipt by Seller.
9.5 Confidentiality Obligations. From and after the
date hereof, each party hereto shall strictly maintain the
confidential nature of, and not disclose to any third party or
use for any purpose other than in connection with the Transaction
without prior written consent of the other party, (a) any
confidential information learned about the other or its
Affiliates in the course of the Transaction, or (b) the terms of
this Agreement (including the Purchase Price), or the Related
Agreements or any other documents signed at the Closing Date,
unless and to the extent necessary to carry out the Transaction
or as permitted by this Section 9.5. Each party shall be
responsible for any breach of this Section 9.5 by its Affiliates,
partners, officers, employees, agents or advisors. Upon any
termination of this Agreement pursuant to Section 8.1, Buyer and
Seller each agree to return or destroy any and all materials
containing any confidential information. These restrictions on
use and obligations of confidentiality will not apply to any
information (i) to the extent the receiving party is required to
disclose such information by law or applicable regulation,
including the regulations of any securities exchange, or under
court or government order, (ii) then in the public domain by acts
not attributable to such party, (iii) hereafter received by the
receiving party from a third party source on an unrestricted
basis, (iv) known to the receiving party prior to the date of
disclosure hereunder except to the extent subject to a prior
confidentiality agreement, or (v) necessary to enforce this
Agreement provided that all reasonable steps are taken to limit
the amount of disclosure. If the Closing occurs, Buyer shall be
released from any obligations under this Section 9.5 with regard
to the Assets and the Transaction. Seller shall not disclose or
use any confidential information about the Assets before or after
Closing without the prior written consent of Buyer except as
provided in clauses (i), (ii), (iii) or (v) of the fourth
sentence of this Section 9.5.
9.6 Notices. All notices under this Agreement will be
in writing and will be delivered by personal service, facsimile
or certified mail (postage prepaid) to such address as may be
designated from time to time by the relevant party, and which
will initially be as set forth below. Any notice delivered by
personal service will be deemed delivered which it is actually
delivered and received by the relevant party. Any notice sent by
facsimile will be deemed delivered when the confirmation of the
successful transmission of the facsimile is printed by the
facsimile machine and received by the sending party. Any notice
sent by certified mail will be deemed to have been given three
(3) days after the date on which it is mailed. No objection may
be made to the manner of delivery of any notice actually received
in writing by an authorized agent of a party. Notices will be
addressed as follows or to such other address as the party to
whom the same is directed will have specified in conformity with
the foregoing:
(a) If to Buyer:
Home Box ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Executive Vice
President, General Counsel
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
O'Melveny & ▇▇▇▇▇ LLP
1999 Avenue of the Stars
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇,
Esq.
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to Seller:
Cinema Plus, L.P.
c/o Entertainment Finance
Services, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
Coblence & Warner
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Esq.
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
9.7 Third Party Benefits. None of the provisions of
this Agreement will be for the benefit of, or enforceable by, any
third-party beneficiary.
9.8 Governing Law; Jurisdiction. This Agreement has
been negotiated and entered into in the State of California, and
all questions with respect to the Agreement and the rights and
liabilities of the parties will be governed by the laws of that
state, regardless of the choice of law provisions of California
or any other jurisdiction. Any and all disputes between the
parties which may arise pursuant to this Agreement will be heard
and determined before an appropriate federal or state court
located in Los Angeles, California. The parties hereto
acknowledge that such court has the jurisdiction to interpret and
enforce the provisions of this Agreement and the parties waive
any and all objections that they may have as to personal
jurisdiction or venue in any of the above courts.
9.9 Waivers Strictly Construed. With regard to any
power, remedy or right provided herein or otherwise available to
any party hereunder (i) no waiver or extension of time will be
effective unless expressly contained in a writing signed by the
waiving party; and (ii) no alteration, modification or impairment
will be implied by reason of any previous waiver, extension of
time, delay or omission in exercise, or other indulgence.
9.10 Illegality. Nothing herein contained shall be
construed to require the performance by either party of any act
contrary to law. In the event of any conflict between any
provision hereof and any law or governmental regulation, the
latter shall prevail, but in such event the affected provisions
of this Agreement shall be curtailed only to the extent necessary
to bring them within the requirement of such law or regulation.
9.11 Relationship of Parties. Nothing herein contained
shall be deemed to constitute a partnership between or joint
venture by the parties, nor shall either party be deemed the
agent of the other. Neither party shall hold itself out contrary
to the provisions hereof.
9.12 Successors and Assigns. This Agreement shall
inure to the benefit of and shall be binding on the parties, and
their respective successors and assigns except that Seller may
not assign its rights or obligations under this Agreement without
the prior written consent of Buyer and any assignment in
violation of this Section shall be null and void. Buyer may
assign its rights and obligations under this Agreement to any
Affiliate.
9.13 Rules of Construction.
9.13.1 Headings. The Article and Section
headings in this Agreement are inserted only as a matter of
convenience, and in no way define, limit, or extend or interpret
the scope of this Agreement or of any particular Article or
Section.
9.13.2 Tense and Case. Throughout this
Agreement, as the context may require, references to any word
used in one tense or case shall include all other appropriate
tenses or cases.
9.13.3 Severability. The validity, legality or
enforceability of the remainder of this Agreement will not be
affected even if one or more of the provisions of this Agreement
is held to be invalid, illegal or unenforceable in any respect.
9.14 Counterparts. This Agreement may be executed
simultaneously in two or more counterparts, each of which will be
deemed an original, but all of which together will constitute one
and the same instrument.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the parties hereto have duly caused
the execution of this Agreement by its authorized representative
as of the date first above written.
SELLER:
CINEMA PLUS, L.P.
By:
HBO Film Management, Inc.,
its Managing General Partner
By: /s/ ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
Title: Vice
President
By:
Entertainment Finance
Services, Inc.,
its
Administrative General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇
Title: President and Sole
Director
BUYER:
HOME BOX OFFICE,
a division of Time Warner
Entertainment
Company, L.P.
By: /s/ ▇▇▇▇▇▇
▇▇▇▇
Name: ▇▇▇▇▇▇
▇▇▇▇
Title: Vice
President
EXHIBIT 7.5
Assignment of Copyright
For good and valuable consideration, the receipt of
which is hereby acknowledged, Cinema Plus, L.P., a Delaware
limited partnership, hereby assigns, transfers, sets over and
conveys to Home Box Office, a division of Time Warner
Entertainment Company, L.P. of [address], all right, title and
interest in and to the motion pictures set forth in Schedule 1
attached hereto including the copyright and all other proprietary
rights therein, throughout the world, and further including any
and all causes of action for infringements of the same, past,
present, and future, and all of the proceeds from the foregoing
accrued and unpaid and hereafter accruing.
In witness whereof the undersigned has executed the
foregoing this _____ day of ___________, 19___.
Cinema Plus, L.P. By: Entertainment Finance
By: HBO Film Management, Services, Inc.,
Inc., its Managing its Administrative
General Partner General Partner
By: By:
Name: Name:
Title: Title:
STATE OF )
) ss.
COUNTY OF )
On____________________, before me, ______________________,
Notary Public, personally appeared________________________,
personally known to me OR proved to me on the basis of
satisfactory evidence to be the person(s) whose name is/are
subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized
capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s) or the entity upon behalf of which the
person(s) acted, executed the instrument.
WITNESS my hand and official seal
SIGNATURE OF NOTARY
SCHEDULE 1
Pictures
Don't Tell Mom the Babysitter's Dead
Switch
Ricochet
Mom and Dad Save the World
EXHIBIT 7.7
▇▇▇▇ of Sale
For good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and pursuant to the
Purchase and Sale Agreement dated as of September ___, 1997 (the
("Agreement") between Home Box Office, a division of Time Warner
Entertainment Company, L.P. ("Buyer"), and Cinema Plus, L.P., a
Delaware limited partnership ("Seller"), and intending to be
legally bound hereby, Seller hereby unconditionally and
irrevocably transfers to Buyer and its successors and assigns,
all of Seller's right, title, and interest in and to the Assets
(as that term is defined in the Agreement).
Seller hereby covenants and agrees that, without
further consideration, at any time and from time to time after
the date hereof, it will execute and deliver to Buyer such
further instruments and take such other commercially reasonable
action, all upon the reasonable request of Buyer, in order to
more effectively transfer all or any portion of the Assets to
Buyer, and to assure and confirm to any other person the
ownership of the Assets by Buyer, and as may be necessary to
carry out the purposes of this ▇▇▇▇ of Sale and the Agreement.
This ▇▇▇▇ of Sale shall be binding upon and inure to
the benefit of Buyer and Seller and their respective successors
and assigns.
IN WITNESS WHEREOF, Seller has caused this ▇▇▇▇ of Sale
to be executed as of this ___ day of ________, 1997.
CINEMA PLUS, L.P.
By: HBO Film Management, Inc.,
its Managing General Partner
By:
Name:
Title:
By: Entertainment Finance
Services, Inc.,
its Administrative General
Partner
By:
Name:
Title:
AGREED AND ACCEPTED:
HOME BOX OFFICE,
a division of Time Warner
Entertainment Company, L.P.
By:
Name:
Title:
TABLE OF CONTENTS
1. Agreement to Purchase and Sell 1
1.1 Acquisition 1
1.2 Closing 2
1.3 Transfer 2
1.4 Sales Tax 2
2. Consideration 2
2.1 Cash Payment 2
2.2 Assumption of Certain Obligations 2
2.3 Payment of Receivables 2
3. Representations and Warranties of Seller 2
3.1 Existence and Rights 2
3.2 Agreement Authorized 2
3.3 No Conflict 3
3.4 Ownership 3
3.5 Rights Unimpaired 3
3.6 Non-Infringement and Litigation 3
3.7 Clearance 4
3.8 Bankruptcy; Liens/Encumbrances 4
3.9 Music 4
3.10 Insurance Claims 4
3.11 Contingencies 4
3.12 Compliance with Law 4
3.13 Guild Obligations; Participations 4
3.14 Commissions 5
3.15 Accuracy of Information Furnished 5
4. Representations and Warranties of Buyer 5
4.1 Existence and Rights 5
4.2 Agreement Authorized 5
4.3 No Conflict 5
4.4 Commissions 6
5. Covenants of Seller 6
5.1 Conduct of Business Prior to Closing 6
5.2 Representations True 6
5.3 Access 6
5.4 Permits 7
5.5 Physical Properties 7
5.6 Delivery of Books and Records 7
5.7 Account Notices 7
5.8 Performance of Obligations 7
5.9 Good Faith Efforts 7
5.10 Related Agreements 8
6. Covenants of Buyer 8
6.1 Representations True 8
6.2 Permits 8
6.3 Good Faith Efforts 8
6.4 Guild Assumption Agreements 8
7. Conditions Precedent to Obligations of Buyer 8
7.1 Representations and Warranties 8
7.2 Covenants 8
7.3 No Injunction or Litigation 8
7.4 Consents Obtained 9
7.5 Assignment of Copyright 9
7.6 Related Agreements 9
7.7 ▇▇▇▇ of Sale 9
7.8 Assignment of Insurance Policies 9
7.9 Notices; Documentation 9
7.10 Outstanding Accounts Receivable 9
7.11 No Adverse Changes 9
7.12 Closing Documents 9
7.13 Further Assurances 9
8. Termination 10
8.1 Grounds for Termination 10
8.2 Effect of Termination 10
8.3 Rights to Proceed 10
8.4 Specific Performance 10
8.5 Survival of Representations and Warranties 10
9. Miscellaneous 10
9.1 Complete Agreement; Modifications 10
9.2 Expenses 11
9.3 Remedies Not Exclusive 11
9.4 Cooperation 11
9.5 Confidentiality Obligations 11
9.6 Notices 11
9.7 Third Party Benefits 13
9.8 Governing Law; Jurisdiction 13
9.9 Waivers Strictly Construed 13
9.10 Illegality 13
9.11 Relationship of Parties 13
9.12 Successors and Assigns 13
9.13 Rules of Construction 13
9.14 Counterparts 14
SCHEDULE A Definitions
SCHEDULE 3.13 Guild/Participation Agreements
EXHIBIT A Pictures
EXHIBIT B Existing Exploitation Agreements
EXHIBIT 5.5(a) Lab Notices
EXHIBIT 5.5(b) Access Notices
EXHIBIT 5.7 Account Notices
EXHIBIT 7.5 Assignment of Copyright
EXHIBIT 7.7 ▇▇▇▇ of Sale
Any exhibits or schedules not filed with the Current Report
on Form 8-K dated September 24, 1997 will be supplied to the
Securities and Exchange Commission upon request.
