EXHIBIT 10.23
XxxxxxxxXxxxxxx.xxx, Inc.
Xxxxxxxxxxxxxxx.xxx, LLC
0000 0xx Xxxxxx
Xxxxx 000
Xxxxx Xxxxxx, XX 00000
Xxxxx 00, 0000
XxxxxXxxxx Ltd.
0000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxx Xxxxxxxxx, XX 00000
Ladies and Gentlemen:
This letter sets forth the principal terms of the agreement between
XxxxxxxxXxxxxxx.xxx, Inc., a Nevada corporation ("InternetStudios"),
Xxxxxxxxxxxxxxx.xxx, LLC, a Delaware limited liability company and a
wholly-owned subsidiary of InternetStudios ("Online"), MediaChase Ltd., a
Delaware corporation ("MediaChase"), XxxxxxXxxx.xxx, LLC, a Delaware limited
liability company owned by MediaChase ("StudioBuzz"), XxxxxxxxXX.xxx, LLC, a
Delaware limited liability company owned by MediaChase ("ReporterTV"), The
Dot To Watch, LLC, a Delaware limited liability company owned by MediaChase
("TDTW") and XxxxxxxxXX.xxx, Inc., a Nevada corporation ("RTVN") regarding
(i) the formation and capitalization of StudioBuzz and ReporterTV, (ii)
Online's acquisition of an interest in StudioBuzz and ReporterTV; (iii)
MediaChase's acquisition of an interest in Online; and (iv) MediaChase's
agreement to provide certain consulting services to StudioBuzz and Online.
Such agreement is made with reference to the following:
A. The Limited Liability Company Agreement of Online, dated of even
date herewith (the "OFS Operating Agreement").
B. The Limited Liability Company Agreement of StudioBuzz, dated of
even date herewith (the "StudioBuzz Operating Agreement");
C. The Limited Liability Company Agreement of ReporterTV, dated of
even date herewith (the "ReporterTV Operating Agreement");
D. The Consulting Agreement between MediaChase and StudioBuzz, dated
of even date herewith (the "StudioBuzz Consulting Agreement");
E. The Consulting Agreement between MediaChase and Online, dated of
even date herewith (the "Online Consulting Agreement");
F. The Contribution, Assignment and Assumption Agreement, dated of
even date herewith, between MediaChase and The Dot To Watch, LLC, a Delaware
limited liability company owned by MediaChase ("TDTW"), on the one hand, and
ReporterTV, on the other hand (the "RTV Contribution Agreement");
G. The Contribution, Assignment and Assumption Agreement, dated of
even date herewith, between MediaChase and StudioBuzz (the "SB Contribution
Agreement");
H. The Contribution, Assignment and Assumption Agreement, dated of
even date herewith, between RTVN and ReporterTV (the "RTVN Contribution
Agreement");
I. The Contribution, Assignment and Assumption Agreements (other
than the RTV Contribution Agreement, the SB Contribution Agreement and the
RTVN Contribution Agreement) being executed concurrently herewith to
effectuate the transactions contemplated below (such contribution agreements,
together with the RTV Contribution Agreement and the SB Contribution
Agreement are collectively referred to herein as the "Contribution
Agreements");
J. The Assignment of Lease and Landlord's Consent relating to the
transfer to ReporterTV of the Lease Agreement, dated September 30, 1999,
between MediaChase and RTVN, on the one hand, and Xxxxxx Xxxxxxxxxx, on the
other hand (the "Lease Assignment"); and
K. The Allonge, dated of even date herewith, transferring to
ReporterTV the Promissory Note executed by MediaChase in favor of Online (as
successor-in-interest to InternetStudios), as amended, and the termination
agreements releasing MediaChase from its obligations thereunder and under the
security documents executed in connection therewith ("Termination Documents").
The OFS Operating Agreement, the StudioBuzz Operating Agreement and the
ReporterTV Operating Agreement are collectively referred to as the "Operating
Agreements." The StudioBuzz Consulting Agreement and the Online Consulting
Agreement are sometimes collectively referred to as the "Consulting
Agreements." The Operating Agreements, the Consulting Agreements, the
Contribution Agreements, the Lease Assignment and the Termination Documents
are collectively referred to as the "Agreements."
With reference to the above, the parties agree as follows:
1. In order to implement the transactions described in the
Agreements, the parties need to take various actions, including, without
limitation, the following:
(a) each of the parties shall use its reasonable and diligent
best efforts to execute such further documents and instruments and perform
such further acts as may be reasonably required or desirable to carry out the
provisions hereof and of the Agreements and the transactions contemplated
hereby and thereby, with the anticipation that all such matters will be
completed by April 30, 2000;
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(b) dissolution of RTVN and TDTW; and
(c) obtaining all consents and approvals required as a result
of consummation of the transactions contemplated by the Agreements or the
written waiver of such by the parties required to give such consent.
2. Concurrently with the execution of this Agreement, Online agrees
to pay to MediaChase the amounts outstanding invoices for Online of $418,939.
3. ReporterTV and MediaChase hereby agree that MediaChase shall
have the right on a part-time basis to use following employees being
transferred from TDTW to ReporterTV: Xxxx Xxxxxxx, Xxxxx Xxx, Xxx Xxxxxxxxx
and Xxxxxxx Xxxxxx in connection with MediaChase's business; provided,
however, that MediaChase will promptly upon request reimburse ReporterTV for
a pro rated portion of the weekly base salary payable by ReporterTV to such
employees (based upon the amount of time during normal business hours that
MediaChase uses the employees services during such week) together with a
prorated portion of overhead associated with such employee, if applicable.
Notwithstanding the foregoing, MediaChase agrees that any provision of
services to MediaChase by any of the foregoing employees of ReporterTV shall
take into account the workload of such employee and in the event of any
conflict between the needs of ReporterTV and MediaChase, the needs of
ReporterTV with respect to utilization of such employee shall have priority.
4. ReporterTV hereby agrees to defend, indemnify and hold harmless
MediaChase and its principals, officers, directors, employees and affiliates
from and against any and all liabilities, losses, damages, costs and expenses
(including reasonable legal fees and expenses) associated with any claim or
action brought against them by a third party arising out of, relating to or
otherwise in connection with the Assets and Liabilities (as defined in the
RTV Contribution Agreement) being transferred or assumed by it under the RTV
Contribution Agreement or otherwise relating to its businesses; provided,
however, that the foregoing shall not be deemed to relieve MediaChase of its
obligation to indemnify ReporterTV or its affiliates to the extent provided
herein. StudioBuzz hereby agrees to defend, indemnify and hold harmless
MediaChase and its principals, officers, directors, employees and affiliates
from and against any and all liabilities, losses, damages, costs and expenses
(including reasonable legal fees and expenses) associated with any claim or
action brought against them by a third party arising out of, relating to or
otherwise in connection with the Assets and Liabilities (as defined in the SB
Contribution Agreement) being transferred or assumed by it under the SB
Contribution Agreement or otherwise relating to its businesses; provided,
however, that the foregoing shall not be deemed to relieve MediaChase of its
obligation to indemnify StudioBuzz or its affiliates to the extent provided
herein. MediaChase agrees to indemnify and hold harmless ReporterTV and
StudioBuzz and its principals, officers, directors, employees and affiliates
from and against any and all liabilities, losses, damages, costs and expenses
(including reasonable legal fees and expenses) associated with any claim or
action brought against them by a third party arising out of the liabilities
that are determined to be excluded from the Liabilities under the RTV
Contribution Agreement and the SB Contribution Agreement, respectively. The
party being
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indemnified hereunder (the "indemnified party") shall notify the party
agreeing to indemnify such party (the "indemnifying party") promptly of any
such claim in writing, provided, however, that the failure to give such
notice shall not relieve the indemnifying party of the indemnifying party's
obligations hereunder except to the extent that the indemnifying party was
actually and materially prejudiced by such failure with the indemnified
party's liability limited to direct damages caused by such failure. The
indemnifying party will have the sole right to conduct the defense of any
such claim or action (with counsel reasonably satisfactory to the indemnified
party) and all negotiations for its settlement or compromise unless otherwise
agreed to in writing. However, if the indemnifying party, after receiving
notice of any such claim, fails promptly to begin the defense of such claim
or action, the indemnified party may (upon notice to the indemnifying party)
retain counsel and commence to undertake the defense, compromise, or
settlement of such claim or action and any such actions shall be at the
expense of the indemnifying party unless and until indemnifying party
undertakes the defense as contemplated herein. Neither party may enter into
any compromise or settlement that materially affects the other party without
the other party's written approval.
5. The parties agree that the amount set forth in Exhibit A of the
OFS Operating Agreement as InternetStudios' Capital Contribution, shall be
revised following the audit of InternetStudios' Balance Sheet as of March 31,
2000 to reflect the book value of the assets contributed by InternetStudios
to Online as of March 31, 2000.
6. This Agreement and the agreements referred to herein or therein
contain a full and complete statement of the terms of the mutual
understanding of the parties with respect to the subject matter hereof, and
supersede all prior and contemporaneous agreements, understandings,
proposals, representations and warranties. This Agreement can be amended only
by a writing signed by all parties who have signed this Agreement.
7. Except as otherwise provided, the provisions of this Agreement
and all duties, obligations and rights arising herefrom shall be governed by
and interpreted in accordance with the local laws of the State of California,
without giving effect to the principles of conflicts of laws thereof.
8. Whenever possible, each provision of this Agreement will be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision hereof is held to be prohibited or invalid under
applicable law, either in whole or in part, such provision will be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Agreement.
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If the above accurately reflects the understanding of the parties,
please so indicate by executing this Agreement in the space provided below.
XXXXXXXXXXXXXXX.XXX, LLC
By:_________________________________
Its:_________________________________
XXXXXXXXXXXXXXX.XXX, LLC
By:_________________________________
Its:_________________________________
Acknowledged and Agreed:
MEDIACHASE, LTD.
By:________________________________
Its:_______________________________
THE DOT TO WATCH, LLC
By:________________________________
Its:_______________________________
XXXXXXXXXX.XXX, LLC
By: XxxxxxxxXxxxxxx.xxx, Inc.,
Its Manager
By:________________________
Name:______________________
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XXXXXXXXXX.XXX, LLC
By: XxxxxxxxXxxxxxx.xxx, Inc.,
Its Manager
By:________________________
Name:______________________
XXXXXXXXXX.XXX, INC.
By:________________________________
Its:_______________________________
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