HEADS OF THE LICENSE AND ROYALTY AGREEMENT
HEADS OF THE LICENSE AND ROYALTY AGREEMENT, dated as of the 2nd day of
November 1988, between DREAMWEAVERS N.V., a company organized under the laws of
Curacao ("Dreamweavers N.V.") and AMERICAN DREAM ENTERTAINMENT, INC. (formally
Federal Affordable Housing Inc., a corporation organized under the laws of the
State of Minnesota USA ("American Dream").
1. Recitals
WHEREAS, Dreamweavers N.V. has developed a concept for ("Concept");
exploiting an animation of media products known as "Xxxxx and the Dreamweavers"
within the USA; and
WHEREAS, American Dream desires to obtain from Dreamweavers N.V. the
exclusive right to market the Concept of "Xxxxx and the Dreamweavers," the
trademark and all merchandising within the United States of America.
NOW, THEREFORE, in consideration and understanding that the respective
lawyers of both parties will detail the exact wording of the hereby agreed head
of agreement within three (3) months as set forth herein and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
2. Representations by Dreamweavers N.V.
Dreamweavers N.V. represents that:
a. it has the right to enter into this Agreement;
b. it has no other agreements and has not granted to any other
person or entity any right, License or Royalty Agreement, or
any other right or privilege in the Concept for the United
States of America; and
c. it is in a position to enter into and perform this Agreement without
any conflicts of interest.
3. Representation by American Dream
American Dream represents that:
a. it has the right to enter into this Agreement;
b. it will devote sufficient time and effort to the exploitation
of the rights granted hereunder; and
c. it is in a position to enter into and perform this Agreement without
any conflicts of interest.
4. Consideration
As consideration for the exclusive right to market "Xxxxx and the
Dreamweavers" within the continental USA, American Dream shall pay Dreamweavers
N.V. a royalty fee of three percent (3%) of the revenues generated by American
Dream from the exploitation of the marketing and/or operation of "Xxxxx and the
Dreamweavers," or any portion thereof. In addition, American Dream agrees to
purchase from Dreamweavers N.V. and its affiliated companies the Trademark and
exclusive right to commercially exploit the "Xxxxx and the Dreamweavers"
products for Five Million Five Hundred Thousand U.S. Dollars ($5,500,000)
purchase price, which sum shall be payable on the successful completion of the
Private Placement, American Dream is in the process of completing, and
Dreamweavers N.V. shall deliver the media products consisting of feature film
together with the license for TV production of "Xxxxx and the Dreamweavers,"
License for the Merchandising "Xxxxx and the Dreamweavers," License for the
Music of "Xxxxx and the Dreamweavers," License for Designer Fashion Wear of
"Xxxxx and the Dreamweavers," License for the Video of "Xxxxx and the
Dreamweavers" and the License for the Private Label Merchandising of "Xxxxx and
the Dreamweavers" ancillary products.
As further consideration for the granting of the exclusive License and
Royalty Agreement, American Dream hereby agrees to issue to Dreamweavers N.V.
sixteen million (16,000,000) shares of its restricted common stock.
These shares shall be delivered immediately upon execution of this
Agreement at which time the Heads of the License Agreement shall be deemed to be
in full force and effect.
5. License
This License grants to American Dream the exclusive right to utilize
the animated media property of Dreamweavers N.V. provided by Dreamweavers N.V.
to American Dream for the purpose of commercial exploitation in all media forms
and the marketing of all "Xxxxx and the Dreamweavers" related products and the
general operation of the business of exploiting the "Xxxxx and the Dreamweavers"
Concept within the continental United States of America.
Dreamweavers N.V. shall deliver to American Dream by no later than
October 30, 2000, the following "Xxxxx and the Dreamweavers" media and ancillary
products.
a. A master copy of a feature length animated TV movie 72 minutes.
b. A master copy of the animated television series of 26 episodes each
26 minutes.
c. Music production and music albums, CDs.
d. Promotional interactive Internet use of the website and games.
e. The rights to sell a Xxxxx designer and fashion label.
f. The rights to ancillary merchandising products of all Xxxxx
and the Dreamweavers ancillary products.
6. Royalty
American Dream shall pay Dreamweavers N.V. a royalty fee of three
percent (3%) of the revenues generated by American Dream from the exploitation
of the marketing and/or operation of the "Xxxxx and the Dreamweavers" Concept
within the continental United States of America.
7. Term
The term of any License and Royalty Agreement granted hereunder shall
remain in effect for fifteen (15) years from the date hereof and thereafter may
be extended for an additional five (5) year term upon the mutual agreement of
the parties hereto.
Notwithstanding anything to the contrary, Dreamweavers N.V. may
terminate this Agreement upon written notice to American Dream:
a. if any payment is not made when due; provided, however, that
American Dream shall have twenty (20) days from the giving of
written notice of such default to cure such default;
b. if American Dream defaults in its performance of any term or
condition of this Agreement and the default is not cured
within thirty (30) days after notice is given to American
Dream; or
c. if American Dream is adjudged bankrupt, declared insolvent,
files a petition of voluntary or involuntary bankruptcy,
enters into an assignment of assets for the benefit of
creditors, or has a receiver appointed.
8. Accounting/Payments
All payments due hereunder to Dreamweavers N.V. shall be paid on a
monthly basis. American Dream shall make and keep full and accurate accounting
books and records in sufficient detail to enable payments due to Dreamweavers
N.V. to be determined.
9. No Right to Sublicense
American Dream shall have no rights to sublicense any of the rights
granted hereunder without the express written permission of Dreamweavers N.V.
10. Infringement
To be specified but the normal standard clauses to be incorporated in
final document.
11. Improvements
If, during the term of this Agreement, Dreamweavers N.V. makes any
improvements in the Concept or the mode of using the Concept, or becomes the
owner of any improvement either through patents or otherwise, then Dreamweavers
N.V. shall make available to American Dream full information regarding the
improvement (subject to American Dream entering into a confidentiality agreement
acceptable to Dreamweavers N.V.) and, if additional terms (financial and
otherwise) shall be agreed upon by the parties hereto, such improvement shall be
included in any grant made hereunder.
If during the term of this Agreement American Dream makes any
improvements or modifications to the "Xxxxx and the Dreamweavers" concept,
American Dream will provide Dreamweavers N.V. full access and technical
information regarding such improvements and obtain the approval of Dreamweavers
N.V. prior to implementing such modifications.
12. Governing Law, Jurisdiction
This Agreement shall be governed by and construed in accordance with
the laws of the Netherlands Antilles.
13. Notices
Any notices or other communications required or permitted hereunder to
be effective shall be in writing and shall be deemed to have been duly given or
made when personally delivered or, in the case of registered or certified mail,
postage prepaid, two or three days after being sent, or, in the case of
overnight courier or prepaid telegram, one business day after being sent by such
overnight delivery service or by prepaid telegram, addressed in each case as
follows:
If to Dreamweavers N.V.:
Inter Trust Antilles N.V.
Landhuis Joonchi Kaya Xxxxxxx X. Xxxxxxx
Curacao, NA
Telephone: (000) 0 000 00 00
Fax: (000) 0 000 000 00
If to American Dream Entertainment Inc.:
c/o NEVADA Corporate Services Inc.
0000 X, Xxxxxx Xxxxx 000 Xxx Xxxxx, XX 00000 XXX
14. Amendments and Waivers
This Agreement may be amended, or any provision of this Agreement may
be waived, provided that no such amendment or waiver shall be valid unless set
forth in writing executed by the parties hereto or, in the case of a waiver, by
the party waiving such provision. The waiver by any party of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
other breach.
15. Severability
If any one or more or any portion of the provisions of this Head of
Agreement is deemed to be invalid or unenforceable in any respect for any
reason, the parties shall negotiate in good faith to revise the terms of these
Heads of Agreement to adjust for the invalidity or unenforceability of such
provisions and the validity and enforceability of the remaining provisions of
this Agreement shall not in any way be affected or impaired thereby.
16. Assignability
The rights granted hereunder shall not be assignable by American Dream.
Dreamweavers N.V. may assign its financial interest in this Agreement but may
not assign any of the other obligations hereunder.
17. Limitations
The license shall apply to all commercial rights to "Xxxxx and the
Dreamweavers" by American Dream within the Continental United States of America.
a. The license will not be assignable to third parties;
b. All liabilities, direct or consequential, incurred by "Xxxxx
and the Dreamweavers" by American Dream shall be borne
exclusively by American Dream.
IN WITNESS WHEREOF, American Dream Entertainment Inc. and Dreamweavers
N.V. have executed this Agreement as of the day and year first above written.
AMERICAN DREAM
ENTERTAINMENT, INC.
By:_____________________________
As:_____________________________
DREAMWEAVERS, N.V.
By: INTERTRUST (ANTILLES) N.V.
By:________________________
X. Xxxxx
Managing Director
6/7/99 4:51 PM d-1
40353.100501
#187740 v1
