SETTLEMENT AGREEMENT ANDGENERAL RELEASE

 

This Settlement Agreement and General Release (the "Agreement") is executed as of June 22, 2009 by and between Red Mile Entertainment, Inc. (“Red Mile”), on the one hand, and MTV Networks, a division of Viacom International Inc. (“MTVN”) on the other hand. Red Mile and MTVN, collectively, shall be referred to as the “Parties.”

WHEREAS, the Parties entered into a Merchandise License Agreement dated as of March 28, 2005, as amended from time to time (the “License Agreement”) pursuant to which License Agreement, MTVN granted to Red Mile a license to develop, manufacture and sell video game products based on MTVN’s property known as “Jackass” (the “Jackass Property”) for various gaming platforms;

 

WHEREAS, the Parties entered into a Game Development Agreement dated as of June 18, 2007, as amended from time to time (the “Development Agreement”) to develop a “Jackass” game for the Nintendo DS platform;

 

WHEREAS, on March 7, 2008 MTVN terminated the License Agreement and the Development Agreement;

 

WHEREAS, on or about March 23, 2009, Red Mile filed a complaint against MTVN in the Supreme Court of the State of New York, entitled Red Mile Entertainment, Inc. v. MTV Networks, a Division of Viacom International Inc., Index No. 09-600-888, alleging casues of action for breach of contract and intentional interference with contract (the “Complaint”);

 

WHEREAS, each party contends that it has been damaged by the conduct of the other in connection with the License Agreement, the Development Agreement and the Jackass Property (the “Dispute”);

 

WHEREAS, the Parties now desire to resolve all existing and potential claims, disputes, and causes of action that they have or may have against each other

 

arising from or related to the Dispute in an amicable and business-oriented manner, without the necessity of further litigation or proceedings, in accordance with the terms set forth below;

WHEREAS, the Parties recognize and acknowledge that the execution of this Agreement will not be deemed to be an admission of any liability or wrongdoing whatsoever on the part of any party.

 

 

NOW, THEREFORE, in consideration of the recitals and mutual promises contained in this Agreement, the receipt and adequacy of which are hereby acknowledged, the Parties agree as follows:

 

1.     Payment

 

a. Within five (5) business days after (1) receipt by MTVN of IRS form W-9’s completed and executed by Red Mile and Bullivant Houser Bailey PC, and (2) execution of this Agreement by the Parties and their counsel, and (3) receipt by MTVN of written confirmation that the Conditions Precedent set forth in Paragraph 2a below have been satisfied, MTVN will pay or cause to be paid the sum of One Hundred One Thousand, One Hundred Eighty-One dollars and Thirty-Two cents ($131,181 .32) to Red Mile, as a lump sum payment in settlement of any claims based on, arising out of, relating to or in connection with the Dispute. The payment will be made to Red Mile by wire transfer, care of its counsel Bullivant Houser Bailey PC, pursuant to the wire instructions to be provided by Red Mile’s counsel.

 

b. All state and federal tax payments required to be paid on account of the consideration paid to Red Mile under this Agreement, care of its counsel, shall be the exclusive responsibility of Red Mile and Red Mile shall indemnify MTVN against all losses and liabilities arising from such tax obligations.

 

2.            Return of MTVN’s Property and Dismissal of Complaint

 

a.            Within three (3) days after execution of this agreement by the Parties and their counsel, Red Mile agrees to (1) return all MTVN Work Product; (2) return to MTVN all MTVN Confidential Information (as those terms are used in the License Agreement and the Distribution Agreement) provided to Red Mile; (3) cause to be transferred any and all domain names registered, owned or controlled by Red Mile that are associated with MTVN, “Jackass” and/or the Jackass Property (the “MTVN Domain Names”); (4) return all materials, artwork, programs, documentation, game codes, source codes or any other electronic or computer codes, data or programming, in any form or format, associated with the Jackass Property including, without limitation, any and all materials that Red Mile is obligated to return to MTVN pursuant to the License and Distribution Agreements (“Game Materials”); and (5) provide written notice to Prodigy Design Limited, d/b/a Sidhe Interactive (“Sidhe”), that, as of March 7, 2008, all contracts between Red Mile and MTVN regarding the Jackass Property were terminated, and that all rights that Red Mile had or has pursuant to its agreements with Sidhe, including Red Mile’s rights to game and source codes, and any other materials related to the Jackass Property (including, without limitation, all materials that Sidhe is obligated to provide to Red Mile pursuant to agreements between Red Mile and Sidhe (the “Sidhe Materials”)) have been transferred and assigned to MTVN, and that MTVN is the owner of all right, title and interest in and to the Sidhe Materials. The foregoing terms in this paragraph shall be conditions precedent (the “Conditions Precedent”) to payment by MTVN under Paragraphs 1a-b, above. Upon completion of the Conditions Precedent, counsel for Red Mile shall send written confirmation of said completion to counsel for MTVN. For purposes hereof, the Jackass Property, MTVN Confidential Information, MTVN Domain Names, Game Materials and Sidhe Materials are collectively referred to as the “MTVN Property.”

 

 

 

 

 

 

This Agreement is admissible in any action to enforce any provision herein, pursuant to Section 1123 of the California Evidence Code.

 

15.          Execution in Counterparts.

 

This Agreement may be executed and delivered in two or more counterparts, each of which, including but not limited to pages transmitted by facsimile or electronic mail attachment, when so executed and delivered, shall be deemed to be an original.

 

IN WITNESS WHEREOF, the Parties hereto each have approved and executed this Agreement effective as of the dates set forth below.