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Exhibit 10.8
SETTLEMENT AGREEMENT
This Agreement is entered into by and among John J. Drury ("Drury"),
National Media, Inc., a dissolved Florida corporation ("Media"), Buffalo Bob
Enterprises, Inc., a Florida corporation ("BBE"), VidKid Distribution, Inc., a
Florida corporation ("VidKid") and Realm Production and Entertainment, Inc., a
Florida corporation ("Realm").
RECITALS
A. The parties have entered into numerous written agreements regarding
services to be performed for VidKid or Realm by Drury, BBE and Robert E. Smith
who is now deceased.
B. The Agreements also provided for Drury, Media and BBE to transfer
any ownership interest they had in one hundred thirty episodes of the Howdy
Doody Show which are described on Attachment A (the "Tapes") to VidKid.
C. Over the past several months, Drury and Media have been involved in
litigation with Madison Sports and Entertainment, Inc. ("Madison") over the
ownership of the Tapes.
D. At this point, although the time periods for appeal have not yet
expired, orders have been entered by the Broward County Circuit Court granting
ownership in the Tapes to John J. Drury. Madison has brought appeals from these
orders which are currently pending (the "Appeals").
E. VidKid had entered into an agreement with Madison for the purchase
of the Tapes. Madison was unable to perform under that agreement due to the
lawsuit by Drury and Media.
F. VidKid has planned to exploit the Tapes in connection with the 50th
anniversary of the Howdy Doody Show and can not go forward without clear title
to the Tapes.
G. All of the parties wish to resolve all of their outstanding
responsibilities to each other by Drury, Media and BBE conveying any ownership
rights they may have in the Tapes to VidKid in exchange for the payments
provided for in this Agreement.
In consideration of Ten Dollars ($10.00) and other good and valuable
consideration, the receipt and sufficiency of which is acknowledged by the
parties, the parties agree as follows:
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1. The above recitals are true and correct and are incorporated herein.
2. Drury, Media and BBE assign and convey to VidKid all of their right,
title and interest in and to the Tapes.
3. The parties agree to terminate the rights and obligations of the
parties described in the "Agreement as of February 11, 1998" by and among
VidKid, Drury, Media and Robert E. Smith (now deceased) as well as the
Independent Contractors Agreement dated as of October 21, 1997 by and among
VidKid and BBE pertaining to the personal services of Robert E. Smith and Drury
(the "1997 Agreement"). Further, the parties agree to terminate any rights or
obligations they may have to each other pertaining to any other agreements that
they may have entered into. To further acknowledge their intentions, the parties
shall execute and exchange the General Releases, attached in the form of
Attachment B.
4. In exchange for conveying to VidKid any ownership rights they may
have in the Tapes, subject to a final disposition of the Appeals in which Drury,
Media and BBE are found to have complete ownership rights to the Tapes without
the possibility of further appeal ("Final Disposition"), VidKid or Realm shall
pay to Drury the total sum of $130,000 to be divided among Drury, Media and BBE
in any manner they determine. The payment shall be made in four installments,
with $25,000 being payable on or before September 21, 1998; $25,000 being
payable on or before October 16, 1998; $50,000 being payable on or before March
15, 1999; and the final installment of $30,000 being payable on or before June
15, 1999. As the Appeals are pending and the results of which may not be known
for months, VidKid agrees to make the first $25,000 payment as provided, but the
remaining payments shall not be made until there is a Final Disposition of the
cases pending. If the result of the Appeals is that the case is remanded to the
trial court for further action, payments shall be deferred until there is a
Final Disposition. If the result of the Appeal is a Final Disposition, then the
remaining payments shall be made with VidKid being given at least 30 days from
the Final Disposition to make the payments which would have already been payable
if they had not been deferred as provided. If Madison is successful on Appeal
and is eventually found to have ownership rights in the Tapes, then the $25,000
payment provided above shall be applied to the payments due under the 1997
Agreement and shall satisfy in full all obligations for payment to Drury and the
other parties under the 1997 Agreement.
5. The assignment of the Tapes by Drury, Media and BBE is intended to
include the assignment of any copyright they may have to any of the tapes.
Further, Drury, BBE and Media agree to execute any additional documents which
may be necessary to further assign any copyright or any other right they may
have or any other documents which may be necessary to acknowledge or prove to
third parties that they have assigned their rights to the Tapes and vested title
to the Tapes in VidKid.
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6. Drury, Media and BBE, jointly and severally, represent and warrant
to VidKid and Realm as follows:
a. BBE is a corporation duly organized, validly existing and
in good standing under the laws of the State of Florida. BBE has all necessary
power and authority to enter into this agreement and perform its obligations
under this agreement.
b. Media is a dissolved corporation all of the stock of which
was owned by Drury and Drury is the sole surviving director and has all
necessary power and authority to enter into this agreement and perform its
obligations under this agreement.
c. BBE and Media have both properly authorized Drury to act on
their respective behalf and to accept the funds to be paid under this agreement
on their respective behalf.
d. Each of Drury, Media and BBE has the requisite power and
authority to execute, deliver, and perform this Agreement and all other
agreements, assignments, releases and other documents to be executed and
delivered by them hereunder or in connection herewith, at any time, and all
necessary actions on the part of each of Media, BBE and Drury has been duly and
validly taken to authorize the execution, delivery and performance of this
Agreement and such other agreements and instruments to be executed and delivered
by Sellers in connection herewith.
e. This Agreement is and shall constitute the legal, valid and
binding obligation of each of Drury, Media and BBE enforceable against each in
accordance with its terms.
f. Neither the execution, delivery and performance of this
Agreement and such other agreements and instruments nor the consummation of the
transactions contemplated hereby, (i) conflicts with any provision of the
Articles of Incorporation or By-Laws of Media or BBE; (ii) conflicts with,
results in a breach of, or constitutes a default under any applicable law,
judgment, order, ordinance, decree, rule, regulation or ruling of any court or
governmental instrumentality; (iii) results in a breach of, conflicts with,
constitutes a default under or permits any party to terminate, modify,
accelerate the performance of or cancel the terms of, any agreement, lease,
license, indenture, instrument of indebtedness or other obligations to which any
of Drury, media or BBE is a party or is bound; or (iv) creates any liability,
mortgage, lien, pledge, condition or encumbrance of any nature whatsoever upon
any of the Tapes.
g. Neither Drury, Media or BBE has received any notices of
infringement, misappropriation, or conflict from any third party with respect to
the Tapes (other than the claims of Madison) and to their knowledge, none of
them has infringed, misappropriated or otherwise conflicted with any proprietary
rights of any third parties to the Tapes.
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h. Other than the lawsuit with Madison, there are no actions,
suits, proceedings, orders, investigations or claims pending or threatened
against Drury, BBE or Media relating to the Tapes or their ownership of the
Tapes, or before or by any governmental department, commission, board, bureau,
agency or instrumentality.
i. Drury, Media and BBE have good and marketable title in and
to the Tapes.
j. No representation or warranty made by Drury, Media or BBE
herein nor any document or other written instrument furnished or to be furnished
pursuant hereto contains or will contain any untrue statement of a material fact
nor shall any such certificate, document or written instrument omit any material
fact necessary in order to make any statement herein or therein not misleading.
7. Drury, Media and BBE, jointly and severally, each agree to indemnify
VidKid and Realm from any and all costs and claims, damages, negligence,
liabilities, or other obligations growing out of, arising from or relating to
any breach of any obligation, warranty or representation of Drury, Media or BBE
under this Agreement or any document given in connection with this agreement,
and to defend, and to save and hold harmless VidKid and Realm from any and all
liability, claims, losses, costs, expenses or damages VidKid and Realm may
suffer or which are or may at any time be made against VidKid and Realm relating
to the Tapes including but not limited to claims, demands, costs, expenses,
damages, liabilities, settlements or judgements against VidKid or Realm
resulting from litigation or threatened litigation and counsel fees incurred by
VidKid and Realm.
8. Any notice under this Agreement shall be in writing and shall be
deemed to have been given when delivered by hand upon receipt, or upon receipt
when sent by United States registered or certified mail, return receipt
requested, postage prepaid, or by a recognized overnight carrier such as Federal
Express, to the address set forth below, or to such other address or addresses
as any party on five days' prior written notice may from time to time give to
the other parties:
To Media, Drury or Mr. John Drury
BBE ---------------------------------
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If to Realm or VidKid: Realm Entertainment and Production, Inc.
3100 N. 29th Court
Hollywood, FL 33020
attn: Mr. Steven Adelstein
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With a copy to: Richard H. Breit, Esq.
Becker & Poliakoff, P.A.
3111 Stirling Road
Fort Lauderdale, FL 33312
9. The invalidity of any one or more of the words, phrases, sentences,
clauses or sections contained in this Agreement shall not affect the
enforceability of the remaining portions of this Agreement or any part hereof,
all of which are inserted conditionally on their being valid in law, and, if any
one or more of the words, phrases, sentences, clauses or sections contained in
this Agreement shall be declared invalid, this Agreement shall be construed as
if such invalid word or words, phrase or phrases, sentence or sentences, clause
or clauses or section or sections had not been inserted.
10. The waiver by any party hereto of a condition, breach, or violation
of any provision of this Agreement shall not operate nor be construed as a
waiver of any subsequent condition, breach or violation.
11. If a party retains or engages any attorney or attorneys to collect,
enforce or protect its interest with respect to this Agreement, or any
instrument or document delivered pursuant to this Agreement, the non-prevailing
party in any court action shall pay all of the reasonable costs and expenses of
such collection, enforcement or protection, including without limitation all
reasonable attorneys' fees and court costs prior to litigation, at trial and on
appeal.
12. This Agreement shall be governed by and construed in accordance
with the laws of the State of Florida.
13. All parties agree that venue for any court action pertaining to
this Agreement shall be in the state and federal courts located in Broward
County, Florida. All parties agree to submit themselves to the jurisdiction of
these courts.
14. This Agreement and its terms and covenants shall be binding upon
and shall inure to the benefit of the respective successors, heirs, personal
representatives and permitted assigns of the parties.
This Agreement is signed as of the date first above written.
WITNESSES: NATIONAL MEDIA, INC.
a dissolved Florida corporation
/s/ By: /s/ JOHN DRURY
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John Drury, President
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/s/
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(AS TO DRURY, MEDIA AND BBE)
BUFFALO BOB ENTERPRISES, INC.
a Florida corporation
By: /s/ JOHN DRURY
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John Drury, President
/s/ JOHN DRURY
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John Drury, individually, and as the sole
director of both National Media, Inc. and
Buffalo Bob Enterprises, Inc.
VidKid DISTRIBUTION, INC.
a Florida corporation
By: /s/ STEVEN ADELSTEIN
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Steven Adelstein, President
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(AS TO VIDKID AND REALM)
REALM PRODUCTION AND ENTERTAINMENT, INC.
a Florida corporation
By: /s/ STEVEN ADELSTEIN
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Steven Adelstein, President
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