EXHIBIT 10.18
June 15, 1998
Averil Associates, Inc.
833 17th Street, Suite Six
Santa Monica, CA 90403
Attn: Diana L. Maranon
Ladies and Gentlemen:
In connection with your engagement as our financial advisor pursuant to a letter
agreement, dated June 15, 1998 (as such agreement may be amended from time to
time, the "Agreement"), between you and us, we hereby agree to indemnify and
hold harmless you and your affiliates, and your respective directors, officers,
agents, employees and controlling persons, and each of their respective
successors and assigns (collectively, the "indemnified persons"), to the full
extent lawful, from and against all losses, claims, damages, liabilities and
expenses (or actions in respect thereof) that are related to or arise out of (i)
actions or alleged actions taken or omitted to be taken (including any untrue
statements made or any statements omitted to be made) by us or any of our
affiliates, directors, officers, employees or agents, (ii) actions or alleged
actions taken or omitted to be taken by an indemnified person (including acts or
omissions constituting ordinary negligence) pursuant to the terms of, or in
connection with services rendered pursuant to or in accordance with the terms
of, the Agreement or any transaction or proposed transaction contemplated
thereby or any indemnified person's role in connection therewith, or (iii) any
untrue statement or alleged untrue statement of a material fact contained in any
offering materials or in any amendment or supplement thereto, or any omission or
alleged omission of a material fact required to be stated therein or necessary
to make the statements therein not misleading. We will not be responsible,
however, for any losses, claims, damages, liabilities or expenses pursuant to
clause (ii) of the preceding sentence that are finally judicially determined to
have resulted primarily from the gross negligence or willful misconduct of the
person seeking indemnification hereunder. We also agree that (i) no indemnified
person shall have any liability to us or any of our affiliates, directors,
officers, employees or agents except for losses, claims, damages, liabilities or
expenses incurred by us in connection with the transaction that are finally
judicially determined to have resulted primarily from the gross negligence or
willful misconduct of such indemnified person; and (ii) in no event shall the
indemnified persons' aggregate liability in connection with such losses, claims,
damages, liabilities and expenses exceed the fees you actually receive from us
pursuant to the Agreement.
Promptly after receipt by an indemnified person of notice of any complaint or
the commencement of any action or proceeding with respect to which
indemnification is being sought hereunder, such person will notify us in writing
of such complaint or of the commencement of such action or proceeding. We will
not, without the prior written consent of you, settle or compromise or consent
to the entry of any judgment in any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not you or any other indemnified person is an actual or
potential party to such claim, action, suit or proceeding).
We agree that if any indemnification sought by an indemnified person pursuant to
this letter agreement is held by a court to be unavailable for any reason other
than as specified in the second sentience of the first paragraph of this letter
agreement, then we will contribute to the losses, claims, damages, liabilities
and expenses for which such indemnification is held unavailable (i) in such
proportion as is appropriate to reflect the relative benefits to us, on the one
hand, and you, on the other hand, in connection with your engagement referred to
above, or (ii) if the allocation provided by clause (i) above in this paragraph
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) in this
paragraph, but also the relative fault of us, on the one hand, and you, on the
other hand, as well as any other relevant equitable considerations; PROVIDED
HOWEVER, that in any event the aggregate contribution by all indemnified persons
to all losses, claims, damages, liabilities and expenses with respect to which
contribution is available hereunder will not exceed the amount of fees actually
received by you from us pursuant to your engagement referred to above. It is
hereby agreed that for purposes of this paragraph, the relative benefits to us,
on the one hand, and you, on the other hand, with respect to your engagement
shall be deemed to be in the same proportion as (i) the total value paid or
proposed to be paid or received by us or our stockholders, as the case may be,
pursuant to the transaction, whether or not
consummated, for which you are engaged to render financial advisory services,
bears to (ii) the fee paid or proposed to be paid to you in connection with such
engagement. It is agreed that it would not be just and equitable if contribution
pursuant to this paragraph were determined by pro rata allocation or by any
other method which does not take into account the considerations referred to in
this paragraph.
We further agree that we will promptly reimburse you and any other indemnified
person hereunder for all expenses (including fees and disbursements of counsel)
as they are incurred in connection with investigating, preparing or defending
any pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder, whether or not in
connection with pending or threatened litigation in which any indemnified person
is a party; PROVIDED, HOWEVER; that we will have the right to mutually determine
legal counsel to represent you and any other indemnified person hereunder and
will have the right to manage any such legal process, so long as such management
does not adversely impair, hinder or otherwise jeopardize the rights or defense
of you or any other indemnified person hereunder.
Our indemnity, contribution and other obligations under this letter agreement
shall be in addition to any rights that you or any other indemnified person may
have at common law or otherwise, and shall be binding on our successors and
assigns.
We hereby consent to personal jurisdiction, service and venue in any court in
which any claim which is subject to, or which may give rise to a claim for
indemnification or contribution under, this letter agreement is brought against
you or any other indemnified person.
This letter agreement shall be deemed made in California. This letter agreement
and all controversies arising from or relating to performance under this letter
agreement shall be governed by and construed in accordance with the laws of the
State of California, without giving effect to such state's rules concerning
conflicts of laws. ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY CLAIM OR
ACTION ARISING OUT OF THIS LETTER AGREEMENT OR ANY ENGAGEMENT OF YOU IS HEREBY
WAIVED.
It is understood that, in connection with your above-mentioned engagement, you
may also be engaged in writing to act in one or more additional capacities, and
that the terms of the original engagement or any such additional engagement may
be embodied in one or more separate written agreements. The provisions of this
letter agreement shall apply to the original engagement, related activities
prior to the date of the original engagement, any such additional written
engagement and any modification of the original engagement or such additional
written engagement and shall remain in full force and effect following the
completion or termination of your engagement(s).
Sincerely,
FUTURE MEDIA PRODUCTIONS
By:________________________
Alex Sandel
Dated:_____________________
Accepted:
AVERIL ASSOCIATES, INC.
By:_______________________
Diana L. Maranon
Dated:____________________