UTV and Fox will share global revenues from the $57m film in all media, in perpetuity, equally.
The deal is part of UTV's ongoing relationship with Fox following their collaboration on Mira Nair's The Namesake and I Think I Love My Wife, starring Chris Rock, which opens in the US on March 16. Both films are co-productions between UTV and Fox Searchlight.
Commenting on the deal, UTV CEO Ronnie Screwvala, said: 'Night is an immensely talented writer-director. We have developed a great chemistry ever since our first conversation about two months ago and I am really glad things moved fast to allow us to work together.'
'I always had a desire to do something in
Shyamalan, whose credits include The Sixth Sense, Unbreakable and Signs, is of Indian origin but based in Philadelphia.
The Happening is understood to be a sci-fi thriller which portrays the earth's environment as the victim of mankind. Shooting will take place in Philadelphia and on the US East Coast. Release is tentatively scheduled for summer 2008.
Besides Fox, UTV also has partnerships with Disney and Sony, with which it is co-producing two Will Smith pictures.