Joint Venture Agreement re: The Gershwins' Fascinating Rhythm - Niko International Entertainment Corp. and Magicworks Entertainment Inc.
Page 1 of letter to Lee Marshall
May 7, 1997
NIKO INTERNATIONAL ENTERTAINMENT CORP.
100 Lincoln Road
Miami Beach. Florida 33139
May 7, 1997
Mr. Lee Marshall
Magicworks Entertainment, Inc.
199 East Garfield Road
Aurora Ohio 44202
RE: THE GERSHWINS' FASCINATING RHYTHM
Dear Lee:
This letter confirms the agreement between Niko International Entertainment
Corp. ("Niko" or "we") and Magicworks Entertainment, Inc. ("you") regarding
investment in THE GERSHWINS' FASCINATING RHYTHM (the "Play"). The Play is being
developed and initially presented at Hartford Stage Company, a LORT theatre,
and presently is scheduled to commence performances on or about May 10th, 1997.
1. Niko intends to form a joint venture with its producing partners to produce
a first-class production of the Play subsequent to the Play's run at Hartford
Stage. As a joint venturer, we are required to provide one-half (1/2) of the
capitalization of the Play. Our total share is anticipated to be about One
Million Dollars ($1.000,000). In return for this investment in the joint
venture, we will receive reimbursement out of first proceeds (pro-rata with the
other venturers) and thereafter Fifty Percent (50%) of the joint venture's net
profits. Our initial investment contribution is $132,500 plus miscellaneous
expenses, such as office, lawyer, phones, ("Initial Investment") to be used
immediately in the Hartford production.
2. (a) You agree to furnish us all the funds for the Initial Investment
described above. Upon furnishing the Initial Investment, you will then have the
option to fund our remaining investment in the joint venture, provided that the
venturers, in their sole discretion, decide to continue capitalizing the
production subsequent to the Hartford production.
(b) In return for funding Niko's investment, you shall be entitled to
reimbursement of your funding pursuant to the same first proceeds reimbursement
as Niko. In addition, you shall be entitled to receive net profits of Fifty
Percent (50%) of the share of Niko's net profits proportional
<PAGE>
Page 2 of letter to Lee Marshall
May 7, 1997
to your funding of Niko's total investment. By way of example only, if you fund
$132,500 and our investment is $1,325,000, your share of Niko's net profits
would be 5% (or 50% of 10%); or if you fund $1,000,000 and Niko's total
investment is $1,000,000, your share of Niko's net profits will be 50% (or 50%
of 100%).
3. You shall furnish funds for the Initial Investment within three (3) days
after we request that you make payment, although Niko will endeavor to give you
as much notice as possible. Subsequent to the Hartford production if we notify
you that we require additional funding for our capital contribution, you will
have three days to indicate your willingness to furnish said additional
funding, and three more days to furnish the funds.
4. Niko shall retain full force and effect in all its rights and privileges as
a producer of the Play.
Please indicate your consent of the above terms by counter-signing this letter
below.
Sincerely,
NIKO INTERNATIONAL ENTERTAINMENT CORP.
By: /s/Manny Kladitis
-----------------------------
Manny Kladitis, President
AGREED AND ACCEPTED:
MAGICWORKS ENTERTAINMENT, INC.
By: /s/Lee D. Marshall
-------------------------------
Lee Marshall, President