Exhibit 10.5
ASSIGNMENT AND ASSUMPTION AGREEMENT dated as
of March 3, 2004, among Pyramid Media Group,
Inc., a Florida corporation ("PMG"), Xxxxx
Xxxxxx, a resident of the State of Florida;
and Pyramid Records International, Inc., a
Florida corporation (the "Company").
Pyramid Media Group, Inc., a Florida corporation having its
principal place of business at 00000 Xxxxxxxx Xxxx., Xxxxx 000, Xxxxx, XX 00000
("PMG"), executed and delivered to Ark 21 Records, L.P., a California Limited
Partnership, located at 00000 Xxxxxxx Xxxx. Xxxxxxxxx Xxxxx, Xxxxxxx Xxxx, XX
00000 ("Ark") a Distribution Agreement dated May 1, 2003 pursuant to which the
PMG and Ark agreed to certain terms and conditions relating to the distribution
of Records (the "Distribution Agreement"). Xxxxx Xxxxxx is the majority owner
and controlling shareholder of PMG.
Pursuant to Section 14 of the Distribution Agreement, it is not
assignable to a third party except under certain conditions.
The Company is desirous of receiving an assignment of the
Distribution Agreement and assuming the obligations thereunder with the consent
of Ark upon the terms and conditions hereof.
This Assignment and Assumption Agreement is intended to transfer the
all covenants, obligations, rights, title and interest in the distribution
Agreement from PMG into the Company.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
hereto hereby agree as follows:
SECTION 1. ASSIGNMENT AND ASSUMPTION.
(a) In consideration of the Company's assumption of all covenants
and obligations under the Distribution Agreement, PMG does hereby distribute,
assign, transfer and convey (the "Assignment") to the Company, and the Company
hereby accepts from PMG, all of PMG's right, title and interest in, to and under
the Distribution Agreement.
(b) In consideration of the Assignment, the Company does hereby
assume and agrees to perform, comply with and discharge all of the obligations,
duties and liabilities of PMG under the Distribution Agreement (the
"Obligations").
SECTION 2. RIGHT OF ENDORSEMENT.
PMG hereby constitutes and appoints the Company and its successors and
assigns the true and lawful attorney of PMG, with full power of substitution, in
the name of the Company, or in the name of PMG, on behalf of and for the benefit
of the Company, (a) to collect all items being sold, transferred, conveyed and
assigned to the Company as provided herein, (b) to endorse, without recourse,
checks, notes and other instruments constituting or relating to the Distribution
Agreement, (c) to institute and prosecute all proceedings which the Company may
deem proper in order to collect, assert or enforce any claim, right or title of
any kind in or to the Distribution Agreement, (d) to defend and compromise any
and all actions, suits or proceedings in respect of the Distribution Agreement
and (e) to do all such acts and things in relation thereto as the Company may
deem advisable. The foregoing powers are coupled with an interest and shall be
irrevocable by PMG, directly or indirectly, in any manner or for any reason.
SECTION 3. CONSIDERATION.
The Company shall pay PMG the consideration set forth in Amendment to
this Assignment and Assumption Agreement between the Company and PMG.
SECTION 4. FURTHER COVENANTS.
(a) Each of the parties hereto agrees that it will, at its sole
expense, promptly do execute, acknowledge and deliver, and cause to be done,
executed, acknowledged and delivered, all such further acts, deeds,
certificates, assignments, transfers, conveyances, affidavits, powers of
attorney, assurances and other documents as may be reasonably requested by the
other party hereto for better assigning, transferring, granting, conveying,
assuring and conferring right, title and interest to the Company in the
Distribution Agreement.
(b) PMG hereby represents and warrants that the Assignment hereby to
the Company does not require the consent of any other party, and that this
Assignment will be valid and binding upon all parties hereto simultaneously with
the execution of this Agreement.
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE PMG.
PMG hereby represents and warrants to the Company as follows:
(i) such party has the requisite power and authority to
execute and deliver this Agreement and perform its obligations
thereunder;
(ii) the execution and delivery by such party of this
Agreement and the performance by such party of its obligations
hereunder have been duly authorized by all requisite action on the part
of such party;
(iii) this Agreement has been duly executed and delivered by
such party;
(iv) this Agreement is the legal, valid and binding
obligation of such party, enforceable against such party in accordance
with its terms, except as enforcement may be limited by bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights
generally;
(v) the execution and delivery by such party of this
Agreement and the performance by such party of its obligations
hereunder do not (i) violate any provision of the certificate of
incorporation, bylaws or similar organizational documents (if any) of
such party, (ii) violate or cause a default under the Distribution
Agreement or any other material agreement of such party, or (ii)
violate any provision of any federal, state or local law, statute,
ordinance, rule or regulation applicable to such party or its assets;
(vi) there is no litigation pending or overtly threatened in
writing against such party which questions the right, power or
authority of such party to enter into and deliver this Agreement and to
perform its obligations hereunder;
(vii) the execution and delivery by such party of this
Agreement and the performance by such party of its obligations
hereunder do not require the consent or approval of, notice to, filing
with, or other action by, any governmental authority, other than such
of the foregoing as have been made or obtained on or prior to the date
hereof;
(viii) such party has not assigned, pledged or otherwise
transferred any of its right, title, or interest in, or to, the
Distribution Agreement to any other person or entity;
(ix) there are no claims, liens or encumbrances against the
Distribution Agreement of any kind or nature;
(x) the Distribution Agreement is in full force and effect,
legally binding and existing agreement of PMG;
(xi) PMG is not in breach of any term, condition, covenant
or obligation of the Distribution Agreement; and
(xii) PMG owes no sums of money or has any outstanding
obligation as of the date hereof to Ark under the Distribution
Agreement.
SECTION 6. INDEMNIFICATION.
(a) The representations and warranties of the parties hereto
contained in this Agreement or in any writing delivered pursuant hereto
or at the Closing shall survive the Closing and the consummation of the
transactions contemplated hereby (and any examination or investigation
by or on behalf of any party hereto).
(b) PMG covenants and agrees to defend, indemnify and hold
harmless the Company and each Person who controls the Company within
the meaning of the Securities Act from and against any claims, losses,
liabilities, damages, costs and expenses arising out of or resulting
from: (i) any inaccuracy in or breach of any representation or warranty
made by PMG in this Agreement or in any writing delivered pursuant to
this Agreement or at the Closing; or (ii) the failure of PMG to perform
or observe fully any covenant, agreement or provision to be performed
or observed by PMG pursuant to this Agreement or any other Agreements
executed as part of this Agreement.
(c) The foregoing indemnification provisions are in addition
to, and not in derogation of, any statutory, equitable or common-law
remedy any party may have for breach of representation, warranty,
covenant or agreement.
(d) Notwithstanding any provision of this Agreement or of
any other agreement, instrument or undertaking, it is understood and
agreed that the Company shall have the right to set-off the amount of
any indemnity hereunder against (i) any sums of money, whether
compensation or otherwise, owed to Xxxxx Xxxxxx by the Company for any
reason and at any time or (ii) any shares owned by Xxxxx Xxxxxx, or any
successor in interest, in the Company's parent, Pyramid Music Corp., or
any successor in interest of said parent The remedies provided in this
Article shall be cumulative and shall not preclude the assertion by any
party of any other rights or the seeking of any other remedies by it
against any other party.
SECTION 7. SUCCESSORS AND ASSIGNS.
This Agreement and all of the provisions hereof shall apply to, be
binding upon, and inure to the benefit of and be enforceable by each of the
parties hereto and their respective successors and permitted assigns.
SECTION 8. THIRD PARTY BENEFICIARIES.
Except as set forth in the following sentence, nothing in this
Agreement, express or implied, is intended to confer upon any person or entity
(other than the parties hereto and their respective successors and assigns) any
rights or remedies of any nature whatsoever under or by reason of this Agreement
or any provision of this Agreement.
SECTION 9. NOTICES.
Any notices, demands, waivers, consents or other communications that
are given or made hereunder shall be in writing and shall be given or made to
any party hereto by physical delivery, U.S. mail (registered or certified mail,
postage prepaid, return receipt requested) or overnight courier or by
transmission by facsimile to such party at its, his or her address (or facsimile
number) set forth in the Preamble to this Agreement, or such other address (or
facsimile number) as shall have been specified by like notice by such party.
Each such notice, demand, consent or other communication shall be effective upon
receipt in the case of physical delivery or overnight courier, upon confirmation
of receipt by or on behalf of the addressee in the case of transmission by
facsimile if received prior to 5:00 p.m., Miami time, and, if received after
5:00 p.m., Miami time, on the next business day immediately after the date of
such receipt, and five business days after deposit in the U.S. mails in the case
of mailing. As used herein, the term "business day" shall mean a calendar day
other than Saturday, Sunday or other day on which banking institutions in New
York, New York are not required to be open.
SECTION 10. ENTIRE AGREEMENT.
This Agreement contains the entire agreement between the parties hereto
with respect to the subject matter hereof and supersedes all prior and
contemporaneous arrangements or understandings with respect thereto.
SECTION 11. AMENDMENTS, MODIFICATIONS AND WAIVERS.
The terms and provisions of this Agreement may not be modified or
amended, nor any of the provisions hereof waived, temporarily or permanently,
except pursuant to a written instrument executed by each of the parties hereto.
No waiver by any party hereto shall operate or be construed as a waiver of any
subsequent breach by any other party.
SECTION 12. SEVERABILITY.
It is the desire and intent of the parties that the provisions of this
Agreement be enforced to the fullest extent permissible under the law and public
policies applied in each jurisdiction in which enforcement is sought.
Accordingly, in the event that any provision of this Agreement would be held in
any jurisdiction to be invalid, prohibited or unenforceable for any reason, such
provision, as to such jurisdiction, shall be ineffective, without invalidating
the remaining provisions of this Agreement or affecting the validity or
enforceability of such provision in any jurisdiction. Notwithstanding the
foregoing, if such provision could be more narrowly drawn so as not be invalid,
prohibited or unenforceable in such jurisdiction, it shall, as to such
jurisdiction, be so narrowly drawn, without invalidating the remaining
provisions of this Agreement or affecting the validity or enforceability of such
provision in any other jurisdiction.
SECTION 13. CUMULATIVE REMEDIES.
Each party hereto shall have and retain all rights and remedies
existing in its favor at law or in equity, including, without limitation, any
actions for specific performance and/or injunctive or other equitable relief to
enforce or prevent any violations of the provisions of this Agreement. The
parties hereto agree and acknowledge that money damages may not be an adequate
remedy for any breach of the provisions of this Agreement and that any party
hereto may in its sole discretion apply to any court of law or equity of
competent jurisdiction for specific performance and/or other injunctive relief
(without posting any bond or deposit) in order to enforce or prevent any
violations of the provisions of this Agreement.
SECTION 14. INTERPRETATION.
The term "this Agreement" means this Assignment and Assumption
Agreement, together with all schedules and exhibits hereto (if any), as the same
may from time to time be amended, restated, amended and restated, supplemented
or otherwise modified in accordance with the terms hereof. The use in this
Agreement of the term "including" means "including, without limitation." All
references to sections and schedules mean the sections of this Agreement and the
schedules attached to this Agreement, except where otherwise stated. The title
of and the section headings in this Agreement are for convenience of reference
only and shall not govern or affect the interpretation of any of the terms or
provisions of this Agreement. The use herein of the masculine, feminine or
neuter forms shall also denote the other forms, as in each case the context may
require or permit. The representations, warranties and covenants of the parties
hereto set forth herein shall survive the consummation of the transactions
contemplated by this Agreement.
SECTION 15. GOVERNING LAW.
This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of Florida, without giving effect to any
choice or conflict of law provision or rule thereof.
SECTION 16. WAIVER OF JURY TRIAL.
EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL
BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO
THIS AGREEMENT.
SECTION 17. JURISDICTION.
Each of the parties hereto hereby consents to the exclusive
jurisdiction of, and venue in, any federal or state court of competent
jurisdiction located in Miami, Florida, solely in respect of the interpretation
and enforcement of the provisions of this Agreement, and in respect of the
transactions contemplated herein, and hereby waives, and agrees not to assert,
as a defense in any action for the interpretation or enforcement hereof or any
such document, that it is not subject thereto or that such action may not be
brought or is not maintainable in said courts or that the venue thereof may not
be applicable or that this Agreement or any such document may not be enforced in
or by said courts, and the parties hereto irrevocably agree that all claims with
respect to such action or proceeding shall be heard and determined in said
courts. The parties hereby consent to and grant any such court jurisdiction over
the person of such parties and over the subject matter of such dispute and agree
that mailing of process or other papers in connection with any such action or
proceeding in the manner provided in Section 8 or in such other manner as may be
permitted by law, shall be valid and sufficient service thereof.
SECTION 18. COUNTERPARTS.
This Agreement may be executed in more than one counterpart, each of
which shall be deemed an original but all of which shall constitute one and the
same instrument as if the parties executed one counterpart as of the day and
year first above written.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Assumption Agreement to be executed as of the date first above written.
PYRAMID RECORDS INTERNATIONAL, INC.
By:
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Name: Xxxxx Xxxx
Title: President
PYRAMID MEDIA GROUP, INC.
By:
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Name: Xxxxx Xxxxxx
Title: CEO
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Xxxxx Xxxxxx, individually
