EXHIBIT 10.2
[graphic omitted]
XXXXXX ENTERTAINMENT GROUP, INC.
00000 Xxxxxxx Xxxxxxxxx x Xxxxxxx Xxxx, XX 00000
Telephone (000) 000-0000 o Facsimile (818) 531-6224
July 28, 2003
Xxxxx X. Xxxxxxxx. Esq.
Worldwide Film Funding, Inc.
000 Xxxxx Xxxx
Xxxxx 000
Xxxx Xxxxx, XX 00000
RE: "Xxxxxx'x World" (hereinafter referred to as the "Project")
Dear Xxxxx:
This letter shall confirm and set forth the Agreement by and between Xxxxxx
Entertainment Group, Inc. (hereinafter referred to as "KEG" and Worldwide Film
Funding, The. (hereinafter referred to as "WFF") in correction with the above
referenced Project.
Whereas, KEG has entered into an agreement as set forth in Exhibit "A" with WWR
Productions, LLC (hereinafter referred to as "WWR") to produce and distribute a
half hour television series entitled "Xxxxxx'x World" (i.e., the "Project").
Whereas, WFF is preparing a Private Placement Memorandum (hereinafter referred
to as the "PPM") and desires to include the Project therein.
Therefore, KEG and WFF hereby agree to the following terms and conditions in
connection with the above referenced Project:
1. First Look Option: KEG hereby grants WFF a First Look Option to
provide $2 Million U.S. Dollars to fund the production of thirteen
(13) commercial half hour episodes of the Project. In the event that
KEG receives an offer for financing the Project from a third party,
KEG shall provide WFF with written notice thereof and WFF shall be
given two (2) weeks to match said third party's offer and the terms
and condition therein. If WFF is unable to match said offer, KEG shall
provide written notice to WFF that its option has expired and shall be
free to enter into an agreement with the third partys.
2. Term of First Look Option: KEG hereby grants a fast look option to WFF
for a six (6) month period commencing on August 1, 2003 and
terminating on January 31, 2004.
3. Exercise of Option: Provided, that WFF's option for this project has
not expired and WFF is successful in funding the PPM or any portion
thereof WFF must exercise its option and WFF must provide $2 Million
U.S. Dollars to KEG for the production of thirteen half hour episodes
of the Project.
4. Disposition of Gross Receipts: Gross Receipts shall be defined as 100%
of the Gross Receipts actually received by KEG from the exploitation
of the Project. WFF and KEG hereby agree to the following allocation
and disposition of gross receipts:
i. First, KEG distribution fee and expenses shall be recouped
from Gross Receipts;
ii. Second, the production cost in the amount of $2 Million U.S.
Dollars shall be disbursed to WFF; and
iii. Third, the remaining balance of Gross Receipts (hereinafter
referred to as "Adjusted Gross Receipts") shall be disposed
of as follows:
a. 25% of the Adjusted Gross Receipts shall be
payable to WFF;
b. 25% of the Adjusted Gross Receipts shall be payable
to KEG
c. 50% of the Adjusted Gross Receipts shall be payable
to WWR.
5. Accounting & Audit: KEG agrees to maintain accurate books and records
regarding the Disposition of Gross Receipts and agrees to account to
WFF on a semi-annual basis and accompanied by payment if due, within
sixty (60) days after the end of each quarter. However, in the event
that no Gross Receipts have accrued in that accounting period, then
KEG shall not be required to account to WFF. WFF may audit KEG's
applicable records on an annual basis, subject to two (2) weeks prior
written notice to XXX.
0. Relationship of Parties: Nothing herein contained shall constitute a
partnership between or joint venture by the parties hereto, or
constitute either party the agent of the other. Neither party shall
hold itself out contrary to the terms of this clause, and neither
party shall be or become liable by any representation, act or omission
of the other contrary to fine provisions hereof. This Agreement is not
for the benefit of any, third party and shall not be deemed to give
any right or remedy to any such party whether referred to herein or
not. Nothing in this agreement, whether express or implied, is
intended to require WWR, or its members and/or KEG to perform any
action or to fulfill any obligation other than as expressly stated
herein. Nor shall any provision of this agreement be deemed to
supplement, modify or amend any terms provision or condition of
Exhibit "A" to which KEG and WWR remain bound.
7. WWF's Representations & Warranties: WFF represents and warrants that
it shall comply with all applicable state and federal laws and has or
shall receive all required permits and/or exemptions for the PPM.
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8. Indemnification: WFF hereby indemnifies and shall hold harmless both
KEG and WWR and their respective parents, subsidiaries, affiliates,
assignees, licensees, members, directors, officers, and
representatives from any and all claims, costs, liabilities,
obligations, judgments or damages (including reasonable attorneys'
fees) which may be brought against any of the above by way of WWF's
representations in connection with the PPM. WFF hereby indemnifies and
holds WWR and its members and KEG harmless for any claims which may be
brought, for any reason, in any way connected with WFF's Private
Placement, not merely WFF's representation in connection with the PPM.
9. Transfer of Agreement: WFF may not grant, assign, or sublicense this
Agreement or any of its rights or obligations hereunder to any third
party except upon KEG's prior written consent thereof.
10. Notices: All written notices, payments, accountings and other
correspondence shall be made to the parties as follows with a copy via
fax to:
Attn: Xxxxxxxxx X. Xxxxxx
Xxxxxx Entertainment Group, Inc.
00000 Xxxxxxx Xxxxxxxxx
Xxxxxxx Xxxx, XX 00000
Fax: (000) 000-0000
Attn: Xxxxx Xxxxxxxx
Worldwide Firm Funding
000 Xxxxx Xxxx
Xxxxx 000
Xxxx Xxxxx, XX 00000
Fax: (000) 000-0000
11. Modifications: No modifications shall be valid unless in writing and
executed by both parties.
12. Other Terms:
i. WFF and KEG hereby agree and acknowledge that the terms and
conditions of KEG's agreement with WWR Productions in
connection with the Project have been disclosed to and
approved by WFF. Further, said agreement is attached hereto
as Exhibit "A" and is incorporated by reference as
though set forth in full herein.
ii. WFF and KEG hereby agree that KEG shall act as the
distributor for the Project and shall charge distribution
fees and expenses as outlined in Exhibit "A".
iii. WFF hereby agrees to include only the concept of "Xxxxxx'x
World" in the PPM. WFF is not authorized under this
agreement to include the
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likeness of Xxxxxx in connection with the PPM or to infer or
imply that Xxxxxx, WWR or KRG endorse the terms and
conditions of the PPM or any part thereof
iv. WFF amd KEG hereby agree and acknowledge that KEG makes no
guarantee as to the amount of gross receipts that shall be
collected at connection with distributing the Project nor
does KEG make any warranty or guarantee as to WFF's return
on its investment in the Project.
v. Any disputes under this Agreement will be resolved by final
and binding arbitration under the Rules for International
Arbitration of the American Film Marketing Association in
effect when the arbitration is filed (the "AFMA Rules").
Each party waives any right to adjucate any dispute in any
other court or forum except a party may seek interim relief
as allowed by the AFMA Rules. The arbitration will be held
in Los Angeles, California. This Agreement shall be deemed
made and is to be construed and interpreted under the laws
of the State of California applicable to contracts entered
into and totally performed therein. The parties will abide
by any decision in the arbitration and ant court having
jurisdiction may enforce it.
The parties agree that the foregoing terms and conditions may be included in a
more formal agreement, but until and unless such other agreement is fully
executed by the parties, the above provisions shall constitute a binding
agreement between the parties and shall constitute the entire understanding
between the parties hereto and supersedes all prior agreement or understandings,
whether oral or written.
If the above meets your approval, please sign where indicated below and we will
counter-execute and return a fully executed copy to you.
Sincerely,
XXXX XXXXXXXX
Vice President
cc: Xxx Xxxxxx
Xxxxxxxxx X. Xxxxxx
AGREED TO AND UNDERSTOOD BY:
"KEG" "WFF"
XXXXXX ENTERTAINMENT GROUP, WORLDWIDE FILM FUNDING,
INC. INC.
By: /s/ Xxx Xxxxxx By: /s/ Xxxx Xxxxxx
------------------------ -----------------------------
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AGREED TO AND UNDERSTOOD BY:
"KEG" "WFF"
XXXXXX ENTERTAINMENT GROUP, WORLDWIDE FILM FUNDING,
INC. INC.
By: /s/ Xxx Xxxxxx By: /s/ Xxxx Xxxxxx
------------------------- ------------------------------
Its: President Its: President
------------------------ -----------------------------
Date: 8/13/03 Date: 8/13/03
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ACKNOWLEDGEMENT AND CONSENT TO THE ABOVE AGREEMENT:
"WWR"
WWR PRODUCTIONS, LLC
By: /s/ Xxxx Xxxxx
-------------------------
Its:
------------------------
Date:
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Its: Its:
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Date: Date:
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ACKNOWLEDGEMENT AND CONSENT TO THE ABOVE AGREEMENT:
"WWR"
WWR PRODUCTIONS, LLC
By: /s/ Xxxx Xxxxx
-------------------------
Its: Co-Principal
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Date: 8-11-2003
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