EXHIBIT 10.23
________________________________
JOINT VENTURE AGREEMENT
OF
WEB ONE WIRELESS I.S.P. - BATON ROUGE, J.V.
This Joint Venture Agreement, dated as of January 24, 1997, by and between
Media
Entertainment, Inc., a Nevada corporation ("MEI"), and Web One, Inc.,
a Louisiana
corporation ("WebOne"), MEI and WebOne collectively sometimes referred to
as the
"Joint Venturers" or the "Venturers" herein.
SECTION I - GENERAL
1.1 Venture Name. The name of the Joint Venture is Web One Wireless
I.S.P. - Baton
Rouge, J.V.
1.2 Addresses of Venturers. The address of MEI is 0000 Xxxxxxxx Xxxx Xxxx,
Xxxxx
Xxxxx, Xxxxxxx 00000. The address of WebOne is 0000 Xxxxxxxx Xxxx Xxxx, Xxxxx
Xxxxx, Xxxxxxxxx 00000.
SECTION II - DEFINITIONS
2.1 "Affiliate" means any person or entity directly or indirectly
controlling, controlled
by or under common control with another person or entity.
2.2 "Agreement" means this Joint Venture Agreement of Web One Wireless
I.S.P. -
Baton Rouge, J.V.
2.3 "Capital Account" means, for each Venturer, the amount of its capital
contribution,
which amount shall be increased by (i) its additional capital contributions
to the Joint
Venture, if any, and (ii) his proportionate share of Joint Venture profits
and gains, and
decreased by (iii) distributions by the Joint Venture to such Venturer
and (iv) such
Venturer's proportionate share of Joint Venture losses.
2.4 "Gross Receipts" means the amount of Joint Venture revenue from all
sources
whatsoever.
2.5 "Internal Revenue Code" means the Internal Revenue Code of 1986,
as amended.
2.6 "Joint Venture" means the joint venture formed under this Agreement
under the name
"Web One Wireless I.S.P. - Baton Rouge, J.V."
2.7 "Joint Venture Agreement" means this Joint Venture Agreement of Web One
Wireless I.S.P. - Baton Rouge, J.V.
2.8. "Managing Venturer" means Web One, Inc., a Louisiana corporation.
2.9 "Net Cash Flow" means Gross Receipts from Joint Venture operations for
each fiscal
year, less cash operating expenses for each fiscal year.
2.10 "Registered Agent" means the person named in the Joint Venture Agreement
to
receive legal service upon the Joint Venture.
2.11 "Registered Office" means the office named in the Joint Venture
Agreement where
all of the Joint Venture's books and records will be kept.
2.12 "Remaining Net Cash Flow" means Net Cash Flow less payments for the
satisfaction
of current debts and obligations of the Joint Venture and establishing such
Working
Capital Reserves as the Managing Venturer deems necessary for Joint Venture
operations.
2.13 "Unrecovered Cash Contributions" means the amount of cash contributed to
the
capital of the Joint Venture which has not been returned to the contributing
Joint Venturer
by distributions from the Joint Venture pursuant to Section VIII.
2.14 "Working Capital Reserves" means the amount of cash reserves taken from
Net Cash
Flow of the Joint Venture, which the Managing Venturer deems necessary to the
prudent
operation of the Joint Venture.
SECTION III - TERM
3.1 The term of the Joint Venture shall be from the date of the execution
of this Joint
Venture Agreement until December 31, 2021, unless extended or sooner
terminated in
accordance with this Agreement.
SECTION IV - PURPOSE
4.1 The purpose of the Joint Venture is to establish a plan of business for,
and operate
as, a wireless Internet Service Provider in the City of Baton Rouge,
Louisiana, all to earn
a profit.
SECTION V - JOINT VENTURE OFFICE
AND REGISTERED AGENT
5.1 Joint Venture Office. The Registered Office of the Joint Venture in the
State of
Louisiana shall be 0000 Xxxxxxxx Xxxx Xxxx, Xxxxx Xxxxx, Xxxxxxxxx 00000,
or at such
other location as the Venturers may determine.
5.2 Registered Agent. The Registered Agent of the Joint Venture in the
State of
Louisiana shall be Xxxxx X. Xxxxxx, 0000 Xxxxxxxx Xxxx Xxxx, Xxxxx Xxxxx,
Xxxxxxxxx
00000.
5.3 Documents to be Maintained. The Managing Venturer shall keep the
following
documents at the Registered Office of the Joint Venture specified in
Section 5.1
hereinabove:
(a) a copy of this Agreement and all amendments hereto;
(b) copies of the Joint Venture's federal, state and local tax returns and
reports for the
three (3) most recent years, if any; and
(c) copies of financial statements of the Joint Venture for the three (3)
most recent years,
if any.
Such documents shall be available for inspection and copying during
ordinary business
hours at the request of, and at the expense of, the requesting Venturer.
SECTION VI - CAPITAL AND CONTRIBUTIONS
6.1 Upon formation of the Joint Venture, the Managing Venturer will
contribute to the
capital of the Joint Venture cash in the amount of $5,000.
6.2 Upon formation of the Joint Venture, MEI will contribute to the
capital of the Joint
Venture cash in the amount of $5,000.
6.3 Capital Accounts. Each Venturer's capital account shall be increased
(credited) by
(a) the amount of its capital contributions to the Joint Venture pursuant to
Sections 6.1
and 6.2;
(b) the amount of income from operations allocated to it pursuant to
Section 7.1(a);
(c) the amount of gains allocated to it pursuant to Section 7.2(b);
and shall be decreased (debited) by
(d) the amount of losses from operations allocated to it pursuant to
Section 8.1;
(e) all amounts paid or distributed to it pursuant to Section 8.1 (other
than distributions
to any Venturers in repayment of principal and interest on loans); and
(f) the amount of any losses allocated to it pursuant to Section 8.2.
SECTION VII - NET INCOME AND LOSSES FROMOPERATIONS;
AND NET GAINS AND LOSSES FROM DISPOSITION OF ASSETS
7.1 Operations. All "net income" and "net losses" of the Joint Venture
from operations
for any calendar quarter or part thereof, as determined for federal income
tax purposes,
shall be allocated as follows:
(a) for each fiscal year of the Joint Venture from date of its formation,
all net losses shall
be allocated 50% to MEI and 50% to WebOne;
(b) for each fiscal year of the Joint Venture from the date of its
formation, all net income
shall be allocated 50% to MEI and 50% to WebOne.
7.2 Interim Capital Transactions. All net gains and net losses of the
Joint Venture, as
determined for Federal income tax purposes, in connection with the sale of
software
programs, licensing or sale of other assets, and any similar transactions
which, in
accordance with generally accepted accounting principles, are attributable
to capital but
which do not result in dissolution of the Joint Venture (an "Interim Capital
Transaction")
shall be allocated as follows:
(a) first, an amount of the net gains up to the amount of proceeds to be
distributed
pursuant to Section 8.2(a)(i) shall be allocated to the Joint Venturers
in the same amounts
as the proceeds are to be distributed;
(b) then, after adjustment of the capital accounts of the Joint Venturers
to reflect the
allocation of gains under Section 7.1 and distributions and amounts
available for
distribution pursuant to Section 8.2(a)(i), the net gains or net losses
shall be allocated as
provided for allocation of net gains and losses pursuant to
Sections 7.1(a) (losses) and (b)
(gains).
7.3 Dissolution and Termination. All net gains and net losses of the
Joint Venture, as
determined for Federal income tax purposes, in connection with a dissolution
and
termination of the Joint Venture, shall be allocated between the Joint
Venturers as follows:
(a) 50% to MEI and 50% to WebOne.
SECTION VIII - DISTRIBUTIONS
8.1 Definition of "Taxable Distributable Income". "Taxable Distributable
Income" shall
be determined at the end of each fiscal year of the Joint Venture, and shall
mean Gross
Receipts from operations of the Joint Venture for each fiscal year, less cash
operating
expenses for each fiscal year. For purposes of determining Net Operating
Income and Net
Cash Flow, "Gross Receipts" shall mean proceeds from sales of products by
the Joint
Venture in excess of the cost to the Joint Venture for such products.
8.2 (a) Operations. During the period of operations of the Joint Venture,
from the date
of its formation and ending upon the dissolution and termination of the
Joint Venture,
after providing for the satisfaction of the current debts and obligations of
the Joint
Venture and establishing such working capital reserves (the "Working Capital
Reserves")
as the Managing Venturer deems necessary for Joint Venture purposes. The
Managing
Venturer, may, in his sole discretion, make distributions of "Remaining Cash
Flow" (Net
Cash Flow less the above payments), at the end of each calendar quarter,
as follows:
(i) 50% to MEI and 50% to WebOne;
(ii) any Working Capital Reserves subsequently included in Remaining
Net Cash Flow and
distributed shall be distributed in the same manner as described in
Section 8.2(a)(i).
(b) Dissolution and Termination Proceeds. Upon the dissolution and
termination of the
Joint Venture, the Net Gross Proceeds of the sale of all the assets of the
Joint Venture
after making payment of or provision for the liabilities and obligations of
the Joint
Venture shall be distributed or paid, as appropriate, in the following order
of priority:
(i) first, an amount equal to the unpaid interest and principal of any
unpaid loan by a
Venturer to the Joint Venture, such distributions being treated first as
in payment of
accumulated interest and next as in payment of principal of such loans;
(ii) next, 50% to MEI and 50% to WebOne.
8.3 Cash Distributions. All cash distributions to the Joint Venturers
shall be made to the
Joint Venturers at the addresses specified in Section 1.2 or such other
addresses of which
the Joint Venturers shall notify the Joint Venture in writing.
8.4 Limitation to Cash in Return of Capital. No Venturer shall be
entitled to demand and
receive property other than cash in return for its capital contributions
to the Joint Venture.
SECTION IX - CONTROL AND MANAGEMENT
9.1 Management. The Managing Venturer shall, except as specifically limited
herein,
have full, exclusive and complete discretion in the management and control
of the Joint
Venture for the purposes set forth in Section 4.1. In any exercise of
management
authority by the Managing Venturer under this Section, the Managing Venturer
agrees to
manage and control the affairs of the Joint Venture to the best of its
ability, and to
conduct the operations contemplated under this Agreement in a careful and
prudent
manner and in accordance with good industry practice.
9.2 Specific Management Rights. Subject to any limitations expressly set
forth in this
Agreement, the Managing Venturer shall invest the capital of the Joint
Venture in pursuit
of the purposes of the Joint Venture as set forth in Section IV hereof.
Without limiting
the generality of the foregoing, the Managing Venturer is expressly
authorized on behalf
of the Joint Venture to:
(a) enter into a Joint Venture Management Agreement with WebOne in the form
attached
hereto as Exhibit "A";
(b) procure and maintain with responsible companies such insurance as may
be available
in such amounts and with respect to such risks as are deemed appropriate
by the
Managing Venturer;
(c) execute and deliver on behalf of and in the name of the Joint Venture,
or in the name
of an agent of the Joint Venture, notes, financing statements, any and all
documents,
agreements and undertakings relating to institutional financing, leases,
subleases, bills of
sale and any and all other instruments necessary or incidental to the
conduct of the Joint
Venture's business;
(d) coordinate all accounting and clerical functions of the Joint Venture
and employ such
accountants, lawyers, managers, agents or other personnel as may be required
from time
to time to carry on the business of the Joint Venture; and
(e) control and perform, or cause to be performed, all other activities
incident to
managing the operations and affairs of the Joint Venture unless otherwise
specifically
stated in Section 9.3 hereinbelow.
9.3 Limitation on Management Rights. Notwithstanding the generality of the
foregoing,
the Managing Venturer shall not, without the consent of MEI, be empowered to:
(a) do any act in contravention of this Agreement;
(b) do any act which would make it impossible to carry on the ordinary
business of the
Joint Venture;
(c) confess a judgment against the Joint Venture;
(d) possess Joint Venture property or assign any rights in specific Joint
Venture property
for other than a Joint Venture purpose; and
(e) change or reorganize the Joint Venture into any other legal form.
9.4 Conflicts of Interest. Any Venturer may engage in or possess an
interest in other
business ventures of any nature or description independently or with others,
except that
no venturer shall invest in, manage, own, participate in directly or
indirectly in any
business, corporation, partnership or other juridical entity, including a
sole proprietorship,
having a business substantially similar to that embodied in the business
to be established
hereunder. To the extent any venturer shall engage in or possess an
interest in any other
business not prohibited hereunder, no other venturer shall have any rights
in or to such
independent ventures or the income or profits derived therefrom.
9.5 Limitations on Managing Venturer's Liability. The Managing Venturer
will not be
liable, responsible or accountable in damages or otherwise to its
co-venturer for any acts
performed by it, or for its failure to act, in good faith and within the
scope of this
Agreement, and not attributable to gross negligence, malfeasance, fraud,
breach of
fiduciary duty or breach of any express warranty or representation in this
Agreement; and
the Joint Venture, but not any Venturer, shall indemnify and hold harmless
the Managing
Venturer from any loss, damage, liability, cost or expense (including
reasonable attorneys'
fees) arising out of any act or failure to act by it, if such act or failure
to act is in good
faith, within the scope of this Agreement, and is not attributable to
gross negligence,
malfeasance, fraud, breach of fiduciary duty or breach of any express
warranty or
representation in this Agreement.
SECTION X - OBLIGATIONS OF THE MANAGING VENTURER
10.1 Joint Venture Management. The Managing Venturer shall act as the
agent of the
Joint Venture as sole Manager and in such capacity shall perform for the
Joint Venture
all services customarily performed by a managing venturer of a joint venture
engaged in
the activity to be undertaken by the Joint Venture.
SECTION XI - DISSOLUTION AND TERMINATION
11.1 Dissolution. The Joint Venture shall be dissolved and its business
wound up, upon
the earliest to occur of:
(a) December 31, 2021;
(b) the unanimous written consent of the Joint Venturers, that the
Joint Venture should
be dissolved;
(c) the bankruptcy or insolvency of the Managing Venturer; or
(d) the sale of all or substantially all of the Joint Venture's assets.
For the purposes of this Agreement, the term "Bankruptcy" means the filing
of a petition
for relief as to any person as debtor or bankrupt under the Federal
bankruptcy laws
(except if such petition is contested by such person); or the filing by
such person or by
another of a petition or application to declare the insolvency of such
person or for the
appointment of a receiver or a trustee for such person or a substantial part
of his assets;
provided that if such proceeding is commenced by another and such person
indicates his
approval of such proceeding, consents thereto or acquiesces therein, such
proceeding is
not contested by such person. The insolvency of a person shall be deemed
to occur when
such person's assets are insufficient to pay his liabilities and he shall
so admit to the
Venturers.
11.2 No Release of Contractual Obligations. It is understood and agreed,
however, that
no dissolution of the Joint Venture shall release or relieve any of the
parties hereto of
their contractual obligations under this Agreement.
11.3 Distributions of Cash or In Kind. Upon any such dissolution, all
Joint Venture assets
shall be sold and the proceeds distributed, or such assets distributed in
kind if the
Managing Venturer so elects, to the Venturers in their respective shares
as provided
herein.
SECTION XII - ACCOUNTING
12.1 Fiscal Year. The fiscal year of the Joint Venture shall be the
calendar year.
12.2 Method of Accounting. The Managing Venturer may maintain the Joint
Venture's
management reports on a cash transaction basis; nevertheless, it shall
keep, or cause to
be kept, full and accurate records of all transactions of the Joint Venture
either on a cash
or accrual method of accounting.
12.3 Books of Accounts. All of such books of account shall, at all times,
be maintained
at the Registered Office of the Joint Venture, and shall be open during
reasonable business
hours for the reasonable inspection and examination by the Joint Venturers
or their
authorized representatives, who shall have the right to make copies thereof.
12.4 Tax Returns. The Managing Venturer, at Joint Venture expense, shall
prepare or
cause to be prepared (by March 1st of the year after the tax year to which
such tax return
relates), a federal income tax return and such state tax returns as are
required for the Joint
Venture on either the accrual or cash method of accounting.
SECTION XIII - REPORTS AND STATEMENTS
13.1 Reports and Statements.
(a) Within sixty (60) days after the end of each fiscal year of the Joint
Venture, the
Managing Venturer shall cause to be delivered to the Joint Venturers an
annual Cash Flow
Report for the prior fiscal year of the Joint Venture showing all income
and expenses for
said fiscal year. Said report shall be delivered to the Joint Venturers
together with any
amounts distributable to such Joint Venturers pursuant to Section VIII.
(b) On or before March 15th of the year following the end of each fiscal
year of the Joint
Venture, the Managing Venturer shall cause to be delivered to each of the
Venturers such
information as shall be necessary (including a statement for that year of
each such
Venturer's share of net income, net gains and losses, and other items of
the Joint Venture)
for the preparation by each Venturer of federal and state income and other
tax returns.
(c) Within ninety (90) days after the end of each fiscal year of the Joint
Venture,
beginning with the fiscal year ending December 31, 1997, the Managing
Venturer shall
cause to be delivered to the Joint Venturers financial statements which
shall have been
certified by a firm of Certified Public Accountants, at the expense of the
Joint Venture,
which certification shall state that such statements fairly present the
financial position and
results of operations of the Joint Venture in accordance with generally
accepted
accounting principles applied on a consistent basis.
SECTION XIV - BANK ACCOUNTS
14.1 The Managing Venturer shall open and maintain a special bank account
or accounts
in which shall be deposited all funds of the Joint Venture. Withdrawals
from such
account or accounts shall be made upon the signature or signatures of such
person or
persons as the Managing Venturer shall designate.
SECTION XV - NOTICES
15.1 Whenever any notice is required or permitted to be given under any
provisions of
this Agreement, such notice shall be in writing, signed by or on behalf
of the person
giving the notice, and shall be deemed to have been given when delivered
by personal
delivery or mailed by certified mail, postage prepaid, return receipt
requested, addressed
to the person or persons to whom such notice is to be given at the offices
set forth in
Section 1.2.
SECTION XVI - ARBITRATION
16.1 Any dispute arising under this Joint Venture agreement shall be
resolved by
arbitration in New Orleans, Louisiana, under the Rules of the American
Arbitration
Association, as then in effect. The determination and award of the
arbitrator shall be final
and binding on the parties and may be entered as a judgment in any court of
competent
jurisdiction.
SECTION XVII - BINDING EFFECT
17.1 Except as herein otherwise provided to the contrary, this Agreement
shall be binding
upon, and inure to the benefit of, the parties hereto, their successors and
assigns.
SECTION XVIII - NO ORAL MODIFICATION
18.1 No modification or waiver of this Agreement or any part hereof shall
be valid or
effective unless in writing and signed by the party or parties sought to be
charged
therewith; and no waiver of any breach or condition of this Agreement shall
be deemed
to be a waiver of any other subsequent breach or condition, whether of like
or different
nature.
SECTION XIX - APPLICABLE LAWS
19.1 This Agreement shall be governed by, and construed in accordance with,
the laws
of the State of Louisiana.
SECTION XX - COUNTERPARTS
20.1 This Agreement may be executed in counterparts, each of which shall be
deemed an
original, and said counterparts shall constitute but one and the same
instrument which may
be sufficiently evidenced by one counterpart.
SECTION XXI - ENTIRE AGREEMENT
21.1 This Agreement constitutes the entire agreement and understanding
between the
parties and may not be modified or amended, except as specifically provided
for in this
Agreement.
IN WITNESS WHEREOF, the parties hereto have executed and certified this Joint
Venture Agreement as of the day and year first above written.
MEDIA ENTERTAINMENT, INC. WEB ONE, INC.
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxx X. Xxxxxxx
Xxxxx X. Xxxxxx Xxxx X. Xxxxxxx
President President
