Exhibit 10.28
Artistic License Films
000 Xxxx 00xx Xxxxxx
Xxxxx 000
Xxx Xxxx, Xxx Xxxx 00000
June 3, 1998
Xxxxxx Xxxxxxxx
Hollywood Productions, Inc
00 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxx, XX 00000
RE:"DIRTY LAUNDRY"
Dear Xx. Xxxxxxxx:
The following shall constitute a binding agreement between Hollywood
Productions Inc. ("Client") and Artistic License Films ("Distributor")
concerning the U.S. theatrical distribution of the feature film "DIRTY LAUNDRY".
1. DEFINITIONS:
For the purposes of this Agreement, the following terms shall have the
following meanings:
(a) The "Film" means "DIRTY LAUNDRY" which was directed by Xxxxxx Xxxxxxx
and Xxxxxxx Xxxxxxx. .
(b) The "Territory" means New York and Los Angeles. Distributor shall use
best efforts to book the "Film" in three theatres in New York and two in Los
Angeles.
(c) The "Term" means the period of time commencing on the date hereof and
continuing up to (6) months.
(d) "Distribution Expenses" means all of the actual, direct costs and
expenses incurred or caused to be incurred by Distributor in connection with
prints, videotapes and other materials, advertising, promotion, exploitation and
distribution of the Film inclusive of the expenses described in paragraph 3
herein. Where Distribution Expenses are incurred by Distributor in connection
with more than one film, one of which is the Film, the allocation of
Distribution Expenses to the Film shall be in good faith and shall be reasonable
for the Film.
(e) "Gross Receipts" means the aggregate of all monies actually collected
by Distributor from the theatrical exploitation of the Film in the Territory
during the Term hereof. Advances and guarantees in respect of such theatrical
exploitation shall be included in Gross Receipts at such time as they have been
collected by Distributor (as agent for Client), and are nonrefundable. Gross
Receipts shall be net of refunds, credits, discounts, allowances and adjustments
granted by Distributor, and agreed to by Client, to exhibitors. Such Gross
Receipts shall be deposited in a bank account under the joint control of
Distributor and Client (Joint Account).
2. CREATION OF A DISTRIBUTION AGENCY RELATIONSHIP:
Client agrees to retain Distributor, and Distributor agrees to act as
the agent for Client in the Territory during the Term of this Agreement for the
exclusive theatrical, promotion and exploitation of the Film. In regular
consultation with Client, Distributor will provide, among other services,
supervision and advice with respect to the promotion and advertising of the
Film; consultation with respect to the development of key artwork; development
of a release strategy; booking of the Film into theaters; and collection of
Gross Receipts, as agent of Client. Distributor is authorized to act on Client's
behalf as an agent to a disclosed principal solely in a limited capacity and
only to the extent of Distributor to perform under this Agreement; however,
nothing herein shall permit the Distributor to bind the Client or incur any
liability on behalf of Client except as provided in this agreement.
Notwithstanding anything contained in this agreement to the contrary,
Distributor shall have no rights in the copyright of the Film or any materials,
prints, advertisements, imaging or other products thereof. Each of the Parties
to this Agreement shall perform its obligations hereunder as an independent
contractor, and nothing herein shall be construed to create any relationship
among the Parties other than one among independent contractors.
3. MATERIALS TO BE FURNISHED TO DISTRIBUTOR:
Within thirty (30) days following Client's execution of this agreement,
Client shall furnish Distributor with the following:
(a) Four (4) of prints of the Film;
(b) At least twenty-five (25) videotape cassette copies (VHS) of the Film;
(c) Between fifty (50) and one hundred (100) production still photographs
from the Film; and
(d) At least one (1) master press kit.
4. CLIENT'S LIABILITY FOR DISTRIBUTION EXPENSES:
Distributor shall be permitted to incur reasonable Distribution Expenses on
behalf of Client in performing its duties hereunder, as per the annexed budget
of which the items to be furnished as per paragraph 3 is included therein, and
Client shall , as necessary, advance to Distributor or the appropriate agency,
all Distribution Expenses to be incurred on its behalf by Distributor.
Distributor and Client hereby acknowledge and agree that such Distribution
Expenses shall not exceed sixty-five thousand and twenty-five ($65,025) dollars,
unless otherwise authorized by Client in writing prior to being incurred by
Distributor.
5. DISTRIBUTOR'S FEE:
Distributor's fee for providing the services described herein shall be
twenty-five percent (25%) of the Gross Receipts (the "Distributor Fee") from the
theatrical distribution of the Film. Upon execution hereof Client shall pay
Distributor a nonreturnable retainer, provided Distributor renders in good faith
those services, in the amount of twenty thousand ($20,000) dollars (the
Retainer") which shall constitute an advance against the Distributor Fee.
6. DISPOSITION OF GROSS RECEIPTS:
Gross Receipts shall be allocated, applied, and paid on a cumulative basis
in the following order of priority:
(a1) First, 75% to the recoupment by Client of its Distribution Expenses
and any direct and verifiable distribution expenses incurred by Distributor and
not covered in Client's distribution expenses and approved by Client.
(a2) 25% to the repayment to Client of the Retainer.
(b) Third, to the payment to Distributor of the Distributor Fee set forth
in paragraph 5 above.
(c) The remaining Gross Receipts shall be deemed "Net Proceeds" to be
retained by Client.
7. STATEMENTS AND PAYMENTS:
Distributor shall account to Client weekly during the Term. A statement
shall be rendered in Distributor's customary itemized form, accompanied by
payment of the amounts, if any, stated to be due thereupon, within seven (7)
days of the end of each weekly accounting period. If any such statement reflects
Distribution Expense expenditures by Distributor which have remained
unreimbursed for thirty (30) days, Client shall thereupon pay Distributor the
amount of such unreimbursed Distribution Expenses. Distributor shall have the
right to suspend its performance hereunder if Client fails to make any such
payments. Upon thirty (30) days written notice, Client shall have the right to
inspect the books and records of Distributor in order to verify the accuracy of
said statements.
8. CLIENT'S APPROVALS:
Any artwork, the choice of a press agent, release strategy and marketing
plan shall be subject to Client's prior written approval.
9. VERSION OF THE FILM:
Distributor shall not edit or in any way alter the Film without the prior
written approval of Client; provided, however, that Distributor shall have the
right to add its name and logo to the Film.
10. REPRESENTATIONS AND WARRANTIES:
(a) Distributor has and will continue to have the right to enter into and
perform this Agreement.
(b) Client has and will continue to have the right to enter into and to
perform this Agreement and to grant to Distributor all of the rights and
licenses granted herein in accordance with the terms hereof, without any
additional payment by Distributor to any third party. Client further warrants
that neither the Film nor any part thereof, nor the exercise of any right,
license of privilege granted herein, violates or will violate or infringe the
rights of any person or other entity whatsoever.
11. INDEMNIFICATION:
Client shall indemnify and save harmless Distributor, its successors,
licensees and assigns, and any representatives thereof, against any and all
claims and expenses (including without limitation reasonable legal fees and
expenses) incurred by any of them by reason of the breach of any warranty,
undertaking, representation or agreement made or entered into herein or
hereunder by Client.
Distributor shall indemnify and save harmless Client, its successors,
licensees and assigns, and any representatives thereof, against any and all
claims and expenses (including without limitation reasonable legal fees and
expenses) incurred by any of them by reason of the breach of any warranty,
undertaking, representation or agreement made or entered into herein or
hereunder by Distributor.
12. NOTICES:
All notices and payments hereunder, as applicable, shall be given in
writing to Client and Distributor at their respective addresses set forth above,
or to such other addresses as Client of Distributor shall specify by notice as
herein provided. Copies of all notices to Distributor shall be sent
simultaneously to X. Xxxxxx Xxxxxx, II, Esq., Pryor, Cashman, Xxxxxxx & Xxxxx,
000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
13. MISCELLANEOUS:
This letter shall serve as a complete and binding agreement, to be
interpreted in accordance with the internal laws of the State of New York. It is
the intent of the parties that there shall be no prejudice toward, or negative
constructions or interpretations applied toward, either party by reason of the
fact that this letter agreement is drafted as a letter from Distributor to
Client.
If the foregoing accurately reflects our understanding, please countersign
and return one copy of this letter to us.
Sincerely yours,
ARTISTIC LICENSE FILMS
By: Xxxxx Xxxx
/s/ Xxxxx Xxxx
TITLE: President
ACCEPTED AND AGREED TO:
By: Hollywood Productions, Inc.
/s/ Xxxxxx Xxxxxxxx 6/9/98
TITLE: President
