Non-Competition Agreement - Big Entertainment Inc., CinemaSource Inc., Brett West and Pamela West
NON-COMPETITION AGREEMENT
This Non-Competition Agreement (this "Agreement") is entered into as of
May 18, 1999 by and among Big Entertainment, Inc., a Florida corporation (the
"Company"), CinemaSource, Inc., a Connecticut corporation ("CinemaSource") and
each of Brett West and Pamela West (together, the "Executives").
RECITALS
WHEREAS, the Company, CinemaSource and the Executives are parties to
that certain Asset Purchase Agreement, dated as of March 29, 1999 (the "Purchase
Agreement"), providing for the purchase by the Company of substantially all of
the assets of CinemaSource;
WHEREAS, Brett West is the President and sole shareholder of
CinemaSource and serves as a director of CinemaSource, and Pamela West is the
Treasurer and the Secretary of CinemaSource and serves as a director of
CinemaSource;
WHEREAS, the Company and the Executives 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.
"Competing Business" means (i) Premier Datavision, Inc., (ii) any other
business, enterprise or venture that competed with CinemaSource on the date of
the Purchase Agreement or the Closing Date or that is engaged in any business,
enterprise or venture conducted by the business that constitutes the Assets,
(iii) any other business, enterprise or venture that is engaged anywhere in
North America in the compilation, reproduction or distribution of movie
showtimes , movie dates, movie descriptions or synopses, movie photos, movie
trailers or any other movie or theatre related information, or (iv) any other
business, enterprise or venture that is engaged anywhere in North America in the
compilation, reproduction or distribution of information related to radio
programming or concerts or other musical events.
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"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 CinemaSource or the Assets (as defined in the
Purchase Agreement). 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, neither CinemaSource nor the Executives
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, neither CinemaSource nor the Executives 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 CinemaSource or either of the Executives,
either directly or indirectly; and, by way of example but not limitation,
neither CinemaSource nor the Executives 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, neither CinemaSource nor the Executives 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 two percent (2%)
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.
5. PROPRIETARY INFORMATION. From and after the date of this Agreement,
neither CinemaSource nor the Executives shall (for the benefit of CinemaSource
or either of the Executives 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. REPRESENTATIONS. Each Executive represents and warrants to the
Company that he or she is an officer and a director of CinemaSource, is actively
involved in the business of
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CinemaSource and will receive, directly or indirectly, substantial benefits from
the transactions contemplated by the Purchase Agreement.
7. 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.
8. 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,
CinemaSource and the Executives 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, CinemaSource and the Executives each also agrees that service
of process may be accomplished pursuant to the provisions of Section 11 hereof.
9. 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.
10. 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.
11. 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.
2255 Glades Road, #237W
Boca Raton, Florida 33431-7383
Attention: Chief Executive Officer
Facsimile: (561) 998-2970
with a copy to:
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
Attention: Howard Chatzinoff, Esq.
Facsimile: (212) 735-4989
If to CinemaSource or the Executives:
2 Lookout Point Dr.
Ridgefield, Connecticut 06877
Attention: Brett West and Pamela West
with a copy to:
LeBoeuf, Lamb, Greene & MacRae, L.L.P.
Goodwin Square
225 Asylum Street
Hartford, CT 06103
Attention: Thomas Fairfield, Esq.
Facsimile: (860) 293-3555
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.
12. 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.
13. 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
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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.
14. 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/ Mitchell Rubenstein
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Mitchell Rubenstein
Chairman of the Board and Chief
Executive Officer
CINEMASOURCE, INC.
By /s/ Brett West
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Brett West
President
By /s/ Pamela West
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Pamela West
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