U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report: October 29, 1999
SPINPLANET.COM, INC.
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(Exact name of registrant as specified in its charter)
3PM HOLDING CORP.
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(Former Name of Small Business Issuer)
COLORADO
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(State or other jurisdiction of incorporation)
0-23301 84-1284185
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(Commission File No.) (IRS Employer
Identification No.)
801 E. Tahquitz Canyon Way
Palm Springs, CA 92262
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(Address of principal executive offices) (Zip code)
5650 Greenwood Plaza Blvd.
Suite 216
Englewood, Colorado 80111
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(Former address of small business issuer)
Registrant's telephone number, including area code: (760) 327-2424
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Item 1(a). Change in Control of Registrant.
As a result of the acquisition of Assets described hereinbelow under
"Item 2, Acquisition and Disposition of Assets," the percentage of voting
securities of the Company now beneficially owned directly or indirectly by the
persons who acquired control and the identity of the persons who acquired
control are as follows:
Percent
Name and Address of Amount and Nature of of
Beneficial Owner Beneficial Ownership Class
- ---------------- -------------------- -----
Shadowrock Entertainment, Inc.(1) 13,000,000 89.7%
801 E. Tahquitz Canyon Way
Palm Springs, CA 92262
All Directors 13,000,000 89.7%
and Officers as a
Group (4 persons)(1)
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(1) Messrs. Greg McDonald and Mark A. Bragg, the Company's new officers and
each of whom is a director of the Company, own all of the issued and
outstanding common shares of Shadowrock Entertainment, Inc., equally.
Item 2. Acquisition and Disposition of Assets.
Effective October 29, 1999, the Company acquired certain assets owned
by Shadowrock Entertainment, Inc. ("Shadowrock"), including an exclusive license
to market recordings currently owned by Shadowrock on the Internet (the
"Assets"). The Registrant has previously reported that this acquisition was to
be between the Company and Messrs. McDonald and Bragg, individually. However,
based upon the Company's due diligence, it was ascertained that the true owner
of the Assets was Shadowrock. The balance of the terms as initially reported
remain as stated.
The relevant terms of the transaction provide for the Company to issue
to Shadowrock an aggregate of 13,000,000 "restricted" common shares (post split)
representing approximately 90% of the Company's outstanding common stock after
the Company undertook a "forward split" of its common stock, whereby 3 shares of
common stock were issued in exchange for each share of common stock issued and
outstanding in order to establish the number of issued and outstanding common
shares of the Company immediately prior to Closing to be 1,500,000 shares.
In addition, the Company's shareholders approved an amendment to the
Company's Articles of Incorporation, changing the name of the Company to
"SpinPlanet.com, Inc."
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Subsequent to the closing of the aforesaid Assets acquisition, the
Company's officers and directors resigned and the following persons were
appointed to the positions indicated:
Name Age Position
Greg McDonald 50 Chief Executive Officer,
Secretary, Director
Mark A. Bragg 54 President, Director
Jeffrey P. Kranzdorf 44 Director
Robert L. Siner 57 Director
Item 7(c). Exhibits.
3.3 Amendment to Articles of Incorporation
10.2 Purchase and Sale Agreement between the Company
and Shadowrock Entertainment, Inc.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SPINPLANET.COM, INC.
By: s/Greg McDonald
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Greg McDonald,
Chief Executive Officer
Dated: November 3, 1999
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SPINPLANET.COM, INC.
_____________________
EXHIBIT 3.3
_____________________
AMENDMENT TO
ARTICLES OF INCORPORATION
_____________________
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Mail to: Secretary of State For office use only 002
Corporations Section
1560 Broadway, Suite 200
Denver, CO 80202
(303) 894-2251
MUST BE TYPED Fax (303) 894-2242
FILING FEE: $25.00
MUST SUBMIT TWO COPIES
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ARTICLES OF AMENDMENT
Please include a typed TO THE
self-addressed envelope ARTICLES OF INCORPORATION
Pursuant to the provisions of the Colorado Business Corporation Act, the
undersigned corporation adopts the following Articles of Amendment to its
Articles of Incorporation:
FIRST: The name of the corporation is 3PM Holding Corp.
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SECOND: The following amendment to the Articles of Incorporation was adopted on
October 29 19 99 , as prescribed by the Colorado Business
Corporation Act, in the manner marked with an X below:
No shares have been issued or Directors Elected - Action by Incorporators
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No shares have been issued but Directors Elected - Action by Directors
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Such amendment was adopted by the board of directors where shares
have been issued and shareholder action was not required.
- ------
X Such amendment was adopted by a vote of the shareholders. The number of
shares voted for the amendment was sufficient for approval.
THIRD: If changing corporate name, the new name of the corporation is
SpinPlanet.com, Inc.
- -------------------------------------------------------------------------------
FOURTH: The manner, if not set forth in such amendment, in which any exchange,
reclassification, or cancellation of issued shares provided for in the amendment
shall be effected, is as follows:
If these amendments are to have a delayed effective date, please list that date:
- --------------------------------------------------------------------------------
(Not to exceed ninety (90) days from the date of filing)
3PM HOLDING CORP.
Signature s/Mark A. Bragg
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Mark A. Bragg
Title President
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Revised 7/95
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SPINPLANET.COM, INC.
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EXHIBIT 10.2
____________________
AGREEMENT BETWEEN THE COMPANY AND
SHADOWROCK ENTERTAINMENT, INC.
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AGREEMENT
THIS AGREEMENT is made and entered into as of the 29th day of October
1999, by and between SHADOWROCK ENTERTAINMENT, INC., a California corporation
with its principal place of business located at 801 E. Tahquitz Canyon Way, Palm
Springs, CA 92262 (hereinafter referred to as "Shadowrock") and 3PM HOLDING
CORP., a Colorado corporation with its principal place of business located at
5650 Greenwood Plaza Blvd., Suite 216, Englewood, Colorado 80111 (hereinafter
referred to as "3PM").
WITNESSETH:
WHEREAS, Shadowrock controls, for the purposes herein stated, master
recordings embodying the vocal and instrumental performances of the recording
artists (hereinafter sometimes jointly referred to herein as "Artists") listed
on Exhibit "A" attached hereto and incorporated herein by reference (the
"Assets") for, among other things, the purpose of transmitting the same
electronically via the so-called, "World Wide Web" via the Internet; and
WHEREAS, 3PM shall be at all times relevant during the term hereof in a
position to directly or indirectly provide marketing and distribution facilities
for sound recordings in and throughout the Universe (hereinafter referred to as
the "Territory") solely on a "direct to consumer" basis via the Internet and
other means of purely electronic transmission; and
WHEREAS, the Board of Directors and shareholders of Shadowrock and the
Board of Directors of 3PM have determined, subject to the terms and conditions
set forth in this Agreement, that the transaction contemplated hereby is
desirable and in the best interests of their respective corporations. This
Agreement is being entered into for the purpose of setting forth the terms and
conditions of the proposed transaction.
NOW THEREFORE, in consideration of the foregoing and of the mutual
covenants and promises hereinafter set forth, it is agreed:
ARTICLE I
REPRESENTATIONS, COVENANTS AND WARRANTIES
OF 3PM
As an inducement to, and to obtain the reliance of Shadowrock, 3PM
represents and warrants as follows:
Section 1.1 Organization. 3PM is a corporation duly organized, validly
existing and in good standing under the laws of the State of Colorado and has
the corporate power and is duly authorized, qualified, franchised and licensed
under all applicable laws, regulations, ordinances and orders of public
authorities to own all of its properties and assets and to carry on its business
in all material respects as it are now being conducted, including qualification
to do business as a foreign corporation in the states in which the character and
location of the assets owned by it
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or the nature of the business transacted by it requires qualification. Included
in the 3PM Schedules (as hereinafter defined) are complete and correct copies of
the articles of incorporation, amended articles of incorporation (collectively,
hereinafter referred to as the "articles of incorporation") and bylaws of 3PM as
in effect on the date hereof. The execution and delivery of this Agreement does
not and the consummation of the transactions contemplated by this Agreement in
accordance with the terms hereof will not, violate any provision of 3PM's
articles of incorporation or bylaws. 3PM has taken all action required by law,
its articles of incorporation, its bylaws or otherwise to authorize the
execution and delivery of this Agreement. 3PM has full power, authority and
legal right and has taken all action required by law, its articles of
incorporation, bylaws or otherwise to consummate the transactions herein
contemplate.
Section 1.2 Capitalization. The authorized capitalization of 3PM
consists of 120,000,000 shares, of which 20,000,000 shares are Preferred Shares,
par value $0.01 per share, and 100,000,000 are Common Shares, par value $0.0001
per share. As of the date hereof there are 500,000 common shares of 3PM issued
and outstanding. There are no preferred shares issued or outstanding. Prior to
the Closing Date, as defined hereinbelow, the Board of Directors of 3PM shall
undertake a forward split of the 3PM issued and outstanding Common Stock,
whereby 3 shares of Common Stock shall be issued in exchange for every 1 share
of Common Stock presently issued and outstanding, in order to establish the
number of issued and outstanding common shares to be 1,500,000. As of the
Closing Date, as defined herein, there will be no more than 1,500,000 common
shares issued and outstanding and reserved for issuance (the "3PM Common
Shares") held by the then existing securities holders of 3PM and no preferred
shares issued or outstanding. All issued and outstanding 3PM Common Shares have
been legally issued, fully paid and are nonassessable.
Section 1.3 Subsidiaries. 3PM has no subsidiary companies.
Section 1.4 Financial Statements.
(a) Included in the 3PM Schedules are the audited
consolidated balance sheet of 3PM for the years ended December
31, 1998 and 1997 and the related statements of operations,
stockholders' equity and cash flows for the year then ended,
as well as the unaudited interim financial statements for the
nine month period ended September 30, 1999. All of the
aforesaid financial statements, both audited and unaudited,
are included in the schedules identified in Section 1.19(b).
(b) All such financial statements have been prepared
in accordance with generally accepted accounting principles
consistently applied throughout the periods involved. The 3PM
balance sheets presents fairly as of their respective dates
the financial condition of 3PM. 3PM did not have as of the
date of any of such 3PM balance sheets, any liabilities or
obligations (absolute or contingent) which should be reflected
in a balance sheet or the notes thereto prepared in accordance
with generally accepted accounting principles, and all assets
reflected therein are properly reported and present fairly the
value of the assets of 3PM, in accordance with generally
accepted accounting principles. The statements of operations,
stockholders' equity and changes in financial position reflect
fairly the
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information required to be set forth therein by generally
accepted accounting principles.
(c) The books and records, financial and others, of
3PM are in all material respects complete and correct and have
been maintained in accordance with good business accounting
practices.
(d) 3PM has no liabilities with respect to the
payment of any federal, state, county, local or other taxes
(including any deficiencies, interest or penalties).
(e) As of the Closing Date, as defined herein, the
3PM balance sheet and the notes thereto, shall reflect that
3PM has: (i) no receivables; (ii) no accounts payable; and
(iii) no contingent liabilities, direct or indirect, matured
or unmatured.
Section 1.5 Information. The information concerning 3PM as set forth in
this Agreement and in the 3PM Schedules is complete and accurate in all material
respects and does not contain any untrue statement of a material fact or omit to
state a material fact required to make the statements made, in light of the
circumstances under which they were made, not misleading.
Section 1.6 Absence of Certain Changes or Events. Except as described
herein or in the 3PM Schedules, since September 30, 1999:
(a) 3PM has not: (i) amended its articles of
incorporation or bylaws; (ii) waived any rights of value which
in the aggregate are extraordinary or material considering the
business of 3PM; (iii) made any material change in its method
of management, operation or accounting; or (iv) made any
accrual or arrangement for or payment of bonuses or special
compensation of any kind or any severance or termination pay
to any present or former officer or employee;
(b) 3PM has not: (i) granted or agreed to grant any
options, warrants or other rights for its stocks, bonds or
other corporate securities calling for the issuance thereof,
which option, warrant or other right has not been cancelled as
of the Closing Date; or (ii) borrowed or agreed to borrow any
funds or incurred or become subject to, any material
obligation or liability (absolute or contingent); and
(c) to the best knowledge of 3PM, it has not become
subject to any law or regulation which materially and
adversely affects, or in the future may adversely affect, the
business, operations, properties, assets or condition of 3PM.
Section 1.7 Title and Related Matters. As of the Closing Date, 3PM
will own no real, personal or intangible property.
Section 1.8 Litigation and Proceedings. There are no actions, suits
or proceedings pending or, to the best of 3PM's knowledge and belief, threatened
by or against or affecting
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3PM, at law or in equity, before any court or other governmental agency or
instrumentality, domestic or foreign, or before any arbitrator of any kind that
would have a material adverse effect on the business, operations, financial
condition, income or business prospects of 3PM. 3PM does not have any knowledge
of any default on its part with respect to any judgment, order, writ,
injunction, decree, award, rule or regulation of any court, arbitrator or
governmental agency or instrumentality.
Section 1.9 Contracts. On the Closing Date and except for its retainer
agreement with its legal counsel, 3PM hereby warrants and represents as follows:
(a) There are no material contracts, agreements,
franchises, license agreements, or other commitments to which
3PM is a party or by which it or any of its properties are
bound;
(b) 3PM is not a party to any contract, agreement,
commitment or instrument or subject to any charter or other
corporate restriction or any judgment, order, writ,
injunction, decree or award which materially and adversely
affects, or in the future may (as far as 3PM can now foresee)
materially and adversely affect, the business, operations,
properties, assets or conditions of 3PM; and
(c) 3PM is not a party to any material oral or
written: (i) contract for the employment of any officer or
employee; (ii) profit sharing, bonus, deferred compensation,
stock option, severance pay, pension, benefit or retirement
plan, agreement or arrangement covered by Title IV of the
Employee Retirement Income Security Act, as amended; (iii)
agreement, contract or indenture relating to the borrowing of
money; (iv) guaranty of any obligation for the borrowing of
money or otherwise, excluding endorsements made for collection
and other guaranties of obligations, which, in the aggregate
exceeds $1,000; (v) consulting or other similar contract with
an unexpired term of more than one year or providing for
payments in excess of $10,000 in the aggregate; (vi)
collective bargaining agreement; (vii) agreement with any
present or former officer or director of 3PM; or (viii)
contract, agreement, or other commitment involving payments by
it of more than $10,000 in the aggregate. All such
obligations, if any, no matter how immaterial, shall not
survive the execution hereof. As provided for in the letter of
intent executed by and among 3PM and Shadowrock's principal
shareholders, Greg McDonald and Mark Bragg, and in accordance
with filings heretofore made by 3PM with the United States
Securities and Exchange Commission, that certain indebtedness
of $69,510.00 as reflected on the balance sheets of 3PM and
incurred by 3PM in favor of GS2 Partnership, a Colorado
general partnership comprised of 3PM's previous directors,
shall be deemed for all purposes cancelled and forgiven as a
condition precedent to the closing to the transaction
contemplated hereunder.
Section 1.10 No Conflict With Other Instruments. The execution of this
Agreement and the consummation of the transactions contemplated by this
Agreement will not result in the breach of any term or provision of, or
constitute an event of default under, any material
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indenture, mortgage, deed of trust or other material contract, agreement or
instrument to which 3PM is a party or to which any of its properties or
operations are subject.
Section 1.11 Material Contract Defaults. To the best of 3PM's knowledge
and belief, 3PM is not in default in any material respect under the terms of any
outstanding contract, agreement, lease or other commitment which is material to
the business, operations, properties, assets or condition of 3PM, and there is
no event of default in any material respect under any such contract, agreement,
lease or other commitment in respect of which 3PM has not taken adequate steps
to prevent such a default from occurring.
Section 1.12 Governmental Authorizations. To the best of 3PM's
knowledge, 3PM has all licenses, franchises, permits and other governmental
authorizations that are legally required to enable it to conduct its business
operations in all material respects as conducted on the date hereof. Except for
compliance with federal and state securities or corporation laws, no
authorization, approval, consent or order of, or registration, declaration or
filing with, any court or other governmental body is required in connection with
the execution and delivery by 3PM of the transactions contemplated hereby.
Section 1.13 Compliance With Laws and Regulations. To the best of 3PM's
knowledge and belief, 3PM has complied with all applicable statutes and
regulations of any federal, state or other governmental entity or agency
thereof, except to the extent that noncompliance would not materially and
adversely affect the business, operations, properties, assets or condition of
3PM or would not result in 3PM's incurring any material liability.
Section 1.14 Insurance. 3PM has no insurable properties and no
insurance policies will be in effect at the Closing Date, as hereinafter
defined.
Section 1.15 Approval of Agreement. The board of directors of 3PM has
authorized the execution and delivery of this Agreement by 3PM and has approved
the transactions contemplated hereby. The approval of this Agreement by 3PM's
shareholders is not required, except that the shareholders of 3PM have adopted
an amendment to the 3PM Articles of Incorporation, changing the name of 3PM to
"Spin Planet.com, Inc.," subject to the successful consummation of this
Agreement.
Section 1.16 Material Transactions or Affiliations. As of the Closing
Date there will exist no material contract, agreement or arrangement between 3PM
and any person who was at the time of such contract, agreement or arrangement an
officer, director or person owning of record, or known by 3PM to own
beneficially, ten percent (10%) or more of the issued and outstanding common
stock of 3PM and which is to be performed in whole or in part after the date
hereof. 3PM has no commitment, whether written or oral, to lend any funds to,
borrow any money from or enter into any other material transactions with, any
such affiliated person.
Section 1.17 Labor Relations. 3PM has never had a work stoppage
resulting from labor problems. 3PM has no employees other than its officers and
directors and no sums of money are owing to any of them by 3PM.
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Section 1.18. 34 Act Filings. As of the Closing Date, 3PM shall be
current in, and in compliance with all requirements of, all filings required to
be tendered to the Securities and Exchange Commission pursuant to the Securities
Exchange Act of 1934, as amended. Said filings contain all of the information
required pursuant to the Securities Exchange Act of 1934, as amended and, to the
best knowledge of 3PM, do not fail to state any material facts which were
required to be so stated.
Section 1.19 3PM Schedules. Upon execution hereof, 3PM shall deliver to
Shadowrock the following schedules, which are collectively referred to as the
"3PM Schedules" which are dated the date of this Agreement, all certified by an
officer of 3PM to be complete, true and accurate:
(a) complete and correct copies of the articles of
incorporation and bylaws of 3PM as in effect as of the date of
this Agreement;
(b) copies of all financial statements of 3PM
identified in Section 1.4(a);
(c) the description of any material adverse change in
the business, operations, property, assets, or condition of
3PM since September 30, 1999 required to be provided pursuant
to Section 1.6; and
(d) any other information, together with any required
copies of documents, required to be disclosed in the 3PM
Schedules by Sections 1.1 through 1.18.
3PM shall cause the 3PM Schedules and the instruments to be delivered
to Shadowrock hereunder to be updated after the date hereof up to and including
the Closing Date.
ARTICLE II
REPRESENTATIONS, COVENANTS AND WARRANTIES
OF SHADOWROCK
Section 2.1. Organization. Shadowrock is a corporation duly organized,
validly existing and in good standing under the laws of the state of California
and has the corporate power and is duly authorized, qualified, franchised and
licensed under all applicable laws, regulations, ordinances and orders of public
authorities to own all of its properties and assets and to carry on its business
in all material respects as it is now being conducted. The execution and
delivery of this Agreement does not and the consummation of the transactions
contemplated by this Agreement in accordance with the terms hereof will not
violate any provision of Shadowrock's articles of incorporation or bylaws.
Shadowrock has full power, authority and legal right and has taken all action
required by law, its articles of incorporation, its bylaws or otherwise to
authorize the execution and delivery of this Agreement.
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Section 2.2 Information. The information concerning Shadowrock set
forth in this Agreement is complete and accurate in all material respects and
does not contain any untrue statement of a material fact or omit to state a
material fact required to make the statements made, in light of the
circumstances under which they were made, not misleading.
Section 2.3 Title and Related Matters. Except as provided herein,
Shadowrock has good and marketable title to and is the sole and exclusive owner
of the Assets, free and clear of all liens, pledges, charges or encumbrances
except: (a) statutory liens or claims not yet delinquent; and (b) such
imperfections of title and easements as do not and will not, materially detract
from or interfere with the present or proposed use of the Assets or otherwise
materially impair present business operations on such Assets. Except as set
forth herein, Shadowrock owns free and clear of any liens, claims, encumbrances,
royalty interests or other restrictions or limitations of any nature whatsoever
and all procedures, techniques, marketing plans, business plans, methods of
management or other information utilized in connection with the Assets. Except
as set forth herein, no third party has any right to, and Shadowrock has not
received any notice of infringement of or conflict with asserted rights of
others with respect to any product, technology, data, trade secrets, know-how,
proprietary techniques, trademarks, service marks, trade names or copyrights
which, singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would have a materially adverse affect on the proposed
business, operations, financial conditions or income of the proposed use of the
Assets described herein.
Section 2.4 Litigation and Proceedings. To the best of Shadowrock's
knowledge and belief, there are no actions, suits, proceedings or investigations
pending or threatened by or against Shadowrock or affecting Shadowrock or the
Assets, at law or in equity, before any court or other governmental agency or
instrumentality, domestic or foreign or before any arbitrator of any kind that
would have a material adverse affect on the business, operations, financial
condition or income of the Assets. Shadowrock does not have any knowledge of any
default on its part with respect to any judgment, order, writ, injunction,
decree, award, rule or regulation of any court, arbitrator or governmental
agency or instrumentality or of any circumstances which, after reasonable
investigation, would result in the discovery of such a default.
Section 2.5 Material Contract Defaults. Except as set forth herein, to
the best of Shadowrock's knowledge and belief, Shadowrock is not in default in
any material respect under the terms of any outstanding contract, agreement,
lease or other commitment which is material to Assets and there is no event of
default in any material respect under any such contract, agreement, lease or
other commitment in respect of which Shadowrock has not taken adequate steps to
prevent such a default from occurring.
Section 2.6 No Conflict With Other Instruments. The execution of this
Agreement and the consummation of the transactions contemplated by this
Agreement will not result in the breach of any term or provision of, or
constitute an event of default under, any material indenture, mortgage, deed of
trust or other material contract, agreement or instrument affecting the Assets
or to which any of the Assets are subject.
Section 2.7 Governmental Authorizations. To the best of Shadowrock's
knowledge, Shadowrock has all licenses, franchises, permits or other
governmental authorizations legally
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required to enable the Assets to be utilized as contemplated herein in all
material respects as conducted on the date hereof. No authorization, approval,
consent or order of, or registration, declaration or filing with, any court or
other governmental body is required in connection with the execution and
delivery by Shadowrock of this Agreement and the consummation by Shadowrock of
the transactions contemplated hereby.
Section 2.8 Compliance With Laws and Regulations. To the best of
Shadowrock's knowledge, Shadowrock has complied with all applicable statutes and
regulations of any federal, state or other governmental entity or agency
thereof, except to the extent that noncompliance would not materially and
adversely affect the Assets.
Section 2.9 Insurance. All of the Assets are insured for Shadowrock's
benefit under valid and enforceable policies issued by insurers of recognized
responsibility. Such policy or policies containing substantially equivalent
coverage will be outstanding and in full force at the Closing Date.
Section 2.10 Approval of Agreement. The board of directors and
shareholders of Shadowrock have authorized the execution and delivery of this
Agreement by Shadowrock and have approved the transactions contemplated hereby.
Section 2.11 Accuracy of Representations. No certificate furnished by
or on behalf of Shadowrock to 3PM at the time of closing in respect of the
representations, warranties or covenants of Shadowrock herein will contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements contained therein not misleading and all of the
representations and warranties of Shadowrock shall be true as at and as if made
at the time of closing.
ARTICLE III
ASSIGNMENT OF MASTER SOUND RECORDING LICENSE
FOR THE INTERNET
Section 3.1 License of Master Recordings. Shadowrock hereby licenses
exclusively to 3PM, and 3PM hereby accepts from Shadowrock, for the term of this
Agreement and for the Territory only, the master recordings listed on Exhibit
"A" (herein the "Masters") annexed hereto (and by this reference incorporated
herein) to be commercially exploited by 3PM solely by means of so-called
"downloading" and other forms of purely electronic transmission via the
Internet, for the sole purpose, throughout the Territory, of commercially
exploiting the same on a so-called "direct to consumer" basis. 3PM undertakes to
use its best efforts and all reasonable skill and ability in its electronic
distribution hereunder throughout the Territory.
Section 3.2 Rights Granted. Subject to the provisions of Section 3.1
hereof (and to the other provisions of this Agreement), Shadowrock hereby grants
to 3PM with regard to Shadowrock's Masters, the following rights with respect to
the Albums:
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(a) The exclusive rights to distribute, sell and
advertise in the Territory the Albums by means of direct to
consumer electronic digital transmission via the Internet
only.
(b) The non-exclusive right to use in and throughout
the Territory the names and likenesses of the Artists in
connection with the advertising, publicizing or electronic
distribution of the Masters via the Internet as provided for
herein. Except as expressly provided for herein, Shadowrock or
third parties whose rights in and to the same underlie those
of Shadowrock shall own and retain the exclusive right to
exploit all artwork embodying the Artists' names and/or
likenesses hereunder (except as to those uses and ownerships
which are specifically granted to 3PM hereunder) and 3PM shall
have no so-called "merchandising rights" (as that term is
commonly understood in the phonograph record industry) in
and to the Artists' names, voices, likenesses, or facsimile
signatures as a result of this Agreement and the Artists'
performances.
(c) 3PM shall not use or in any way dispose of any
master recording supplied or caused to be supplied by
Shadowrock under this Agreement or any reproduction thereof,
other than in accordance with the terms hereof.
Section 3.3 Term. The term of this Agreement shall commence as of
November 1, 1999 or the date upon which Shadowrock and/or its shareholders or
written designees shall collectively become the majority shareholder(s) of 3PM
(whichever shall occur last) and shall continue for the period described herein
below (hereinafter the "Term").
Section 3.4 Consideration. In consideration of this Agreement and the
rights licensed hereunder, 3PM shall cause to be issued an aggregate of
13,000,000 (post forward split) "restricted" 3PM Common Shares to Shadowrock,
representing approximately ninety percent (90%) interest in and to the issued
and outstanding common stock of 3PM. 3PM shall cause the shares of common stock
to be issued upon receipt from Shadowrock of all documentation and information
required hereunder. The date on which such shares are issued shall be the
"Closing Date".
Section 3.5 Payment and Division of Future Royalties. During the Term
hereof, Shadowrock shall be entitled to twenty-five percent (25%) of all
receipts (i.e. monies or other consideration actually received by 3PM (either
"on receipt" or in accordance with periodic royalty disbursements resulting from
3PM entering into third party agreements providing for periodic accountings and
payments) on an "as received" basis as a result of the commercial electronic
exploitation of the Masters via the Internet as provided for herein. In the
event Shadowrock receives not less than one hundred thousand dollars ($100,000)
from 3PM during the Term, then and without further action or notice on the part
of either party, this Agreement shall automatically renew and a renewal term of
like duration. Such renewal term shall be extended by each consecutive three (3)
year period during which such minimum sum is paid by 3PM to Shadowrock. During
and for any renewal term (or during/for the initial Term) in which such minimum
amount is not paid, 3PM shall have the right, but not the obligation, to elect
to effect
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such renewal by paying to Shadowrock the difference between all net receipts
paid during the relevant time period and the sum of one hundred thousand dollars
($100,000).
Section 3.6 Third Party and Copyright Royalties
(a) To the extent applicable, Shadowrock shall pay or
cause to be paid any and all sums (if any) which may become
due to any third party(ies) pursuant to any contract with
Shadowrock as a result of this Agreement including all sums
due to the Artists or any record producers, musicians,
arrangers, copyists or others whose performances are embodied
in the Albums as a result of this Agreement and 3PM's payment
hereunder. Any claims in connection therewith are without
relevance to the 3PM. Shadowrock shall hold 3PM harmless from
and indemnified against all such third party obligations.
(b) With respect to records released by 3PM hereunder
which embody master recordings hereunder containing
copyrighted musical or other material, 3PM warrants and
represents that it shall obtain all necessary licenses and
that it shall pay directly to the copyright proprietors of
such material or to their duly authorized agent(s), all
mechanical royalties (including the full statutory rate
thereof, as required), performance royalties or other sums
which may be due or become due under and in accordance with
said licenses or any applicable laws with respect to sales
hereunder. 3PM shall hold Shadowrock harmless from and
indemnified against all such third party obligations.
Section 3.7 Delivery of Master Recordings. 3PM shall acknowledge, in
writing Shadowrock's delivery of the master recordings licensed hereunder and
that all such master recordings shall be used by 3PM only for such purposes as
are provided for in this Agreement.
Section 3.8 Trademarks: Label Copy
(a) To the extent Shadowrock has a duly registered
trademark ("Shadowrock Entertainment(TM)") and such use can
lawfully be permitted by Shadowrock, Shadowrock grants to 3PM
for the term of this Agreement the non-exclusive right to use
the Shadowrock's trademark, within the Territory, only and
solely for the purpose of distributing, marketing and
advertising electronic downloading and transmission of the
Masters, as herein provided. 3PM shall comply with all
electronic label copy instructions and on-screen credit
requirements received from Shadowrock. All such label copy
shall bear appropriate copyright notices and notice under the
Universal Copyright Convention.
(b) 3PM agrees and acknowledges that it shall not
acquire any rights of whatever nature in the Shadowrock's said
trademark or any artwork thereof as a result of 3PM's use
thereof, and that all uses thereof by 3PM shall inure to the
benefit of Shadowrock. 3PM shall not directly or indirectly,
during the term of this Agreement or thereafter, attack the
ownership by Shadowrock of its trademark
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and/or "logo" or the validity thereof. 3PM shall at no time
use or authorize the use of any trademark, "logo" trademarks
or other designation identical with or confusingly similar to
Shadowrock's trademarks and "logos."
(c) 3PM shall not at any time apply for any
registration of any copyright, trademark or "logo" or other
designation including any artwork which includes Shadowrock's
trademark and/or "logo," in whole or in part, and shall not
file any document with any governmental authority or take any
other action which would affect the ownership of said
trademark or "logos."
(d) Shadowrock shall furnish 3PM with the names of
songwriters and lyricists of each musical selection embodied
in the Masters. Such information and the individual
running/playing times of each Master shall be delivered to the
3PM not later than that date upon which the Masters are
delivered to the 3PM along with artwork elements on hand.
Section 3.9 Editing. All master recordings released on records
hereunder shall be released in their entirety and without editing and in the
manner and for the purpose originally recorded by Shadowrock, or its predecessor
in interest or client(s).
Section 3.10 Ownership of Licensed Property. All tapes, acetates,
stampers, mothers or duplicates of all Master Recordings referred to herein and
all copyrights, ownerships and rights in and to such master recordings shall
remain the sole and exclusive property of Shadowrock or its underlying licensor,
as the case may be. 3PM will, upon request, execute or cause to be executed, and
will deliver to Shadowrock all documents necessary to establish and effectuate
Shadowrock's clients' unencumbered ownership of all such rights. Neither 3PM nor
anyone claiming rights through 3PM shall sell, assign, transfer, mortgage,
hypothecate or subject to any lien or encumbrance, any of the above rights, and
any attempt thereto shall be null and void and of no force and effect
whatsoever. All graphic depictions of the Artists and references to the Masters
produced or otherwise utilized by or under the authority of 3PM hereunder shall
bear appropriate copyright notices, as required under the Rome Convention,
indicating inter alia that the Master Recordings are copyrighted in the name of
Heritage Entertainment, Inc.
Section 3.11 Rights of Termination of Shadowrock. In the event:
(a) 3PM shall fail to make any payments required
hereunder or 3PM shall fall to perform any of its material
obligations required of it hereunder and Shadowrock shall have
notified 3PM in writing of such failure and 3PM shall not have
cured such failure within five (5) days after such written
notification;
(b) 3PM shall make or attempt to make any assignment
for the benefit of creditors or make any compositions with
creditors, or any action or proceeding under any bankruptcy or
insolvency law is taken by or against 3PM or 3PM shall affect
a voluntary or compulsory liquidation; or
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(c) The businesses of 3PM or a substantial portion of
either shall be expropriated or otherwise taken over by any
government or quasi-governmental authority of any kind;
then and in any of such events, Shadowrock may, in addition to all of its other
rights and remedies at law or otherwise, at its option, terminate this Agreement
upon giving not less than ten (10) days' written notice to 3PM without prejudice
to any rights or claims which Shadowrock may have. Notwithstanding the
expiration or termination of this Agreement for any reason whatsoever, the terms
hereof shall remain in full force and effect until all materials furnished or
made available hereunder (or any reproduction thereof) have been returned to
Shadowrock.
Section 3.12 Effect of Expiration or Termination. Upon the expiration
or termination of this Agreement, all commercial exploitation of the Masters by
or under the authority of 3PM shall cease, and 3PM shall not offer to consumers
on the Internet (or otherwise) any further use of the master recordings licensed
hereunder. All master recordings and all derivatives thereof and any other
material in 3PM's possession or control used in the exploitation of the Masters
hereunder (including, but not limited to, tapes, mothers, stampers or other
electronic renditions of the Masters) shall promptly, at the option of
Shadowrock and upon its written instruction, either:
(a) be transferred by 3PM to Shadowrock or its
designee at 3PM's actual cost, plus shipment charges; or
(b) to the extent Shadowrock so elects in writing, be
destroyed by 3PM under the supervision of Shadowrock or
Shadowrock's designee, or, at Shadowrock's written request,
destroyed by 3PM without such supervision provided 3PM
provides Shadowrock with an affidavit of such fact, sworn to
by a principal officer of 3PM.
ARTICLE IV
SPECIAL COVENANTS
Section 4.1 Access to Properties and Records. 3PM and, relevant to the
Assets only, Shadowrock will each afford to the officers and authorized
representatives of the other full access to the properties, books and records of
the other in order that each may have full opportunity to make such reasonable
investigation as it shall desire to make of the affairs of the other and each
will furnish the other with such additional financial and operating data and
other information as to the business and properties of the other, as the other
shall from time to time reasonably request.
Section 4.2 Availability of Rule 144. Each of the parties acknowledge
that the stock of 3PM to be issued pursuant to this Agreement will be
"restricted securities," as that term is defined in Rule 144 promulgated under
the Securities Act of 1933, as amended. 3PM is under no obligation to register
such shares under the Securities Act, or otherwise. Notwithstanding the
foregoing, however, following the Closing Date, 3PM will use its best efforts
to: (a) make
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publicly available on a regular basis not less than semi-annually, business and
financial information regarding 3PM so as to make available to the shareholders
of 3PM the provisions of Rule 144 pursuant to subparagraph (c)(2) thereof; and
(b) within ten (10) days of any written request of any stockholder of 3PM, 3PM
will provide to such stockholder written confirmation of compliance with such of
the foregoing subparagraph as may then be applicable. The stockholders of 3PM
holding restricted securities of 3PM as of the date of this Agreement and their
respective heirs, administrators, personal representatives, successors and
assigns, are intended third party beneficiaries of the provisions set forth
herein. The covenants set forth in this Section 4.2 shall survive the Closing
and the consummation of the transactions herein contemplated.
Section 4.3 Special Covenants and Representations Regarding the 3PM
Common Shares to be Issued Herein. The consummation of this Agreement, including
the issuance of the 3PM Common Shares to Shadowrock as contemplated hereby,
constitutes the offer and sale of securities under the Securities Act, and
applicable state statutes. Such transaction shall be consummated in reliance on
exemptions from the registration and prospectus delivery requirements of such
statutes which depend, inter alia, upon the circumstances under which Shadowrock
acquires such securities. In connection with reliance upon exemptions from the
registration and prospectus delivery requirements for such transactions, at the
Closing, Shadowrock shall cause to be delivered to 3PM an investment letter,
duly executed in the form included hereinbelow as Exhibit "B."
Section 4.4 Third Party Consents. 3PM and Shadowrock agree to cooperate
with each other in order to obtain any required third party consents to this
Agreement and the transactions herein contemplated.
Section 4.5 Actions Prior to Closing.
(a) From and after the date of this Agreement until
the Closing Date or as permitted or contemplated by this
Agreement, 3PM and Shadowrock will each use its best efforts
to:
(i) carry on its business in substantially
the same manner as it has heretofore;
(ii) maintain and keep the Assets in states
of good repair and condition as at present, except
for depreciation due to ordinary wear and tear and
damage due to casualty;
(iii) maintain in full force and effect
insurance comparable in amount and in scope of
coverage to that now maintained by it;
(iv) perform in all material respects all of
its obligations under material contracts, leases and
instruments relating to or affecting its assets,
properties and business;
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(v) maintain and preserve its business
organization intact, to retain its key employees and
to maintain its relationship with its material
suppliers and customers; and
(vi) fully comply with and perform in all
material respects all obligations and duties imposed
on it by all federal and state laws and all rules,
regulations and orders imposed by federal or state
governmental authorities.
(b) From and after the date of this Agreement until
the Closing Date, neither 3PM nor Shadowrock will, without the
prior consent of the other party:
(i) except as otherwise specifically set
forth herein, make any change in their respective
certificates or articles of incorporation or bylaws;
(ii) declare or pay any dividend on its
outstanding shares of capital stock, except as may
otherwise be required by law, or effect any stock
split or otherwise change its capitalization, except
as provided herein;
(iii) enter into or amend any employment,
severance or similar agreements or arrangements with
any directors or officers;
(iv) grant, confer or award any options,
warrants, conversion rights or other rights not
existing on the date hereof to acquire any shares of
its capital stock; or
(v) purchase or redeem any shares of its
capital stock, except as disclosed herein.
Section 4.6 Undertakings of Shadowrock. Management of Shadowrock, who
will assume the management of 3PM upon Closing, hereby undertakes to 3PM and its
shareholders as follow:
(a) to exercise good faith in their efforts to file
all reports required to be filed by the surviving company
herein with the Securities and Exchange Commission or any
other governmental agency, in a timely manner; and
(b) to exercise all due diligence in causing 3PM to
list its common stock for trading on any national stock
exchange for which 3PM may then qualify for such listing.
Section 4.7 Change in Management of 3PM. Upon the Closing, the present
members of 3PM's Board of Directors shall tender their resignations seriatim so
that the following persons are appointed directors of 3PM in accordance with
procedures set forth in the 3PM bylaws: Greg McDonald, Mark A. Bragg, Jeffrey P.
Kranzdorf and Robert L. Siner. These directors shall hold
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office until their successor shall have been duly elected and shall have
qualified or until their earlier death, resignation or removal.
Section 3.7 Officers of 3PM. Upon the Closing, the present officers of
3PM shall tender their resignations and simultaneous therewith, the following
person shall be elected as officer of 3PM in accordance with procedures set
forth in the 3PM bylaws:
NAME OFFICE
---- ------
Greg McDonald Chief Executive Officer,
Secretary
Mark A. Bragg President
ARTICLE V
CONDITIONS PRECEDENT TO OBLIGATIONS
OF 3PM
The obligations of 3PM under this Agreement are subject to the
satisfaction, at or before the Closing Date, of the following conditions:
Section 5.1 Accuracy of Representations. The representations and
warranties made by Shadowrock in this Agreement were true when made and shall be
true at the Closing Date with the same force and effect as if such
representations and warranties were made at the Closing Date (except for changes
therein permitted by this Agreement), and Shadowrock shall have performed or
complied with all covenants and conditions required by this Agreement to be
performed or complied with by Shadowrock prior to or at the Closing. 3PM shall
be furnished with a certificate, signed by a duly authorized officer of
Shadowrock and dated the Closing Date, to the foregoing effect.
Section 5.2 Stockholder Approval. The stockholders of Shadowrock shall
have unanimously approved this Agreement and the transactions contemplated
thereby.
Section 5.3 Officer's Certificate. 3PM shall have been furnished with a
certificate dated the Closing Date and signed by a duly authorized officer of
Shadowrock to the effect that no litigation, proceeding, investigation or
inquiry is pending or, to the best knowledge of Shadowrock, threatened, which
might result in an action to enjoin or prevent the consummation of the
transactions contemplated by this Agreement or, to the extent not disclosed
herein, by or against Shadowrock which might result in any material adverse
change in any of the Assets.
Section 5.4 Opinion of Counsel to Shadowrock. 3PM shall receive an
opinion dated the Closing Date of Jeffrey P. Kranzdorf, counsel to Shadowrock,
or legal counsel reasonably acceptable to 3PM, in substantially the following
form:
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(a) Shadowrock is a corporation duly organized,
validly existing, and in good standing under the laws of the
state of California and has the corporate power and is duly
authorized, qualified, franchised and licensed under all
material applicable laws, regulations, ordinances and orders
of public authorities to own all of its properties and assets
and to conduct its business as now conducted, including
qualification to do business as a foreign corporation in the
states in which the character and location of the assets owned
by it or the nature of the business transacted by it requires
qualification.
(b) To the best knowledge of such legal counsel, the
execution and delivery by Shadowrock of this Agreement and the
consummation of the transaction contemplated by this Agreement
in accordance with the terms hereof will not conflict with or
result in the breach of any term or provision of Shadowrock's
articles of incorporation or bylaws or violate any court
order, writ, injunction or decree applicable to Shadowrock, or
its properties or assets.
(c) This Agreement has been duly and validly
authorized, executed and delivered by Shadowrock.
(d) To the best knowledge of such legal counsel,
there are no actions, suits or proceedings pending or
threatened by or against or affecting the Assets, at law or in
equity, before any court or other governmental agency or
instrumentality, domestic or foreign or before any arbitrator
of any kind.
(e) Shadowrock has taken all actions required by the
applicable laws of the state of California to permit the
transfer of the Assets to 3PM.
Section 5.5 Other Items. 3PM shall have received such further
documents, certificates or instruments relating to the transactions contemplated
hereby as 3PM may reasonably request.
ARTICLE VI
CONDITIONS PRECEDENT TO OBLIGATIONS OF SHADOWROCK
The obligations of Shadowrock under this Agreement are subject to the
satisfaction, at or before the Closing Date (unless otherwise indicated herein),
of the following conditions:
Section 6.1 Accuracy of Representations. The representations and
warranties made by 3PM in this Agreement were true when made and shall be true
as of the Closing Date (except for changes therein permitted by this Agreement)
with the same force and effect as if such representations and warranties were
made at and as of the Closing Date, and 3PM shall have performed and complied
with all covenants and conditions required by this Agreement to be performed or
complied with by 3PM prior to or at the Closing. Shadowrock shall have been
furnished with a certificate, signed by a duly authorized executive officer of
3PM and dated the Closing Date, to the foregoing effect.
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Section 6.2 Officer's Certificate. Shadowrock shall be furnished with a
certificate dated the Closing Date and signed by a duly authorized officer of
3PM to the effect that no litigation, proceeding, investigation or inquiry is
pending or, to the best knowledge of 3PM, threatened, which might result in an
action to enjoin or prevent the consummation of the transactions contemplated by
this Agreement or, to the extent not disclosed in the 3PM Schedules, by or
against 3PM which might result in any material adverse change in any of the
assets, properties, business or operations of 3PM.
Section 6.3 No Material Adverse Change. Prior to the Closing Date,
there shall not have occurred any material adverse change in the financial
condition, business or operations of nor shall any event have occurred which,
with the lapse of time or the giving of notice, may cause or create any material
adverse change in the financial condition, business or operations of 3PM.
Section 6.5 Opinion of Counsel to 3PM. Shadowrock shall receive an
opinion dated the Closing Date of Andrew I. Telsey, P.C., counsel to 3PM, in
substantially the following form:
(a) 3PM is a corporation duly organized, validly
existing, and in good standing under the laws of the State of
Colorado and has the corporate power and is duly authorized,
qualified, franchised, and licensed under all applicable laws,
regulations, ordinances and orders of public authorities to
own all of its properties and assets and to carry on its
business in all material respects as it is now being
conducted, including qualification to do business as a foreign
corporation in the states in which the character and location
of the assets owned by it or the nature of the business
transacted by it requires qualification.
(b) To the best knowledge of such legal counsel, the
execution and delivery by 3PM of this Agreement and the
consummation of the transactions contemplated by this
Agreement in accordance with the terms hereof will not
conflict with or result in the breach of any term or provision
of 3PM's articles of incorporation or bylaws or constitute a
default or give rise to a right of termination, cancellation
or acceleration under any material mortgage, indenture, deed
of trust, license agreement or other obligation or violate any
court order, writ, injunction or decree applicable to 3PM or
its properties or assets.
(c) The authorized capitalization of 3PM consists of
120,000,000 shares, of which 20,000,000 shares are Preferred
Shares, par value $0.01 per share, and 100,000,000 are Common
Shares, par value $0.0001 per share. As of the Closing Date
there are 1,500,000 common shares of 3PM issued and
outstanding, as a result of a forward split to be adopted by
3PM immediately prior to the Closing, held by the then
existing security holders of 3PM. There are no preferred
shares issued or outstanding. All issued and outstanding
shares are legally issued, fully paid and nonassessable and
not issued in violation of the preemptive rights of any
person.
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(d) The 3PM Common Shares to be issued to the
Shadowrock stockholders pursuant to the terms of this
Agreement will be, when issued in accordance with the terms
hereof, legally issued, fully paid and non-assessable.
(e) This Agreement has been duly and validly
authorized, executed, and delivered and constitutes the legal
and binding obligation of 3PM, except as limited by bankruptcy
and insolvency laws and by other laws affecting the rights of
creditors generally.
(f) To the best knowledge of such counsel, except as
set forth in the 3PM Schedules, there are no actions, suits or
proceedings pending or threatened by or against 3PM or
affecting 3PM's properties, at law or in equity, before any
court or other governmental agency or instrumentality,
domestic or foreign or before any arbitrator of any kind.
(g) 3PM has taken all actions required by the
applicable laws of the state of Colorado to permit the
issuance of the 3PM Common Shares to Shadowrock.
Section 6.6 Compliance with Reporting Requirements. As of the Closing
Date, 3PM shall be current in, and in compliance with all requirements of, all
filings required to be tendered to the Securities and Exchange Commission
pursuant to the Securities Exchange Act of 1934, as amended. Said filings
contain all of the information required pursuant to the Securities Exchange Act
of 1934, as amended and, to the best knowledge of 3PM, do not fail to state any
material facts which were required to be so stated.
Section 6.7 Other Items. Shadowrock shall have received such further
documents, certificates, or instruments relating to the transactions
contemplated hereby as Shadowrock may reasonably request.
ARTICLE VII
MISCELLANEOUS
Section 7.1 Brokers and Finders. Each party hereto hereby represents
and warrants that it is under no obligation, express or implied, to pay certain
finders in connection with the bringing of the parties together in the
negotiation, execution, or consummation of this Agreement. The parties each
agree to indemnify the other against any claim by any third person for any
commission, brokerage or finder's fee or other payment with respect to this
Agreement or the transactions contemplated hereby based on any alleged agreement
or understanding between the indemnifying party and such third person, whether
express or implied from the actions of the indemnifying party.
Section 7.2 Law; Forum and Jurisdiction. This Agreement shall be
construed and interpreted in accordance with the laws of the State of Colorado,
except as US federal law may be applicable.
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Section 7.3 Notices. Any notices or other communications required or
permitted hereunder shall be sufficiently given if personally delivered to it or
sent by registered mail or certified mail, postage prepaid, or by prepaid
telegram addressed as follows:
If to 3PM: Gregory J. Simonds, President
3PM Holding Corp.
5650 Greenwood Plaza Blvd.
Suite 216
Englewood, Colorado 80111
With a copy to: Andrew I. Telsey, Esq.
2851 S. Parker Rd., Suite 720
Aurora, CO 80014
If to Shadowrock: Mr. Greg McDonald, President
Shadowrock Entertainment, Inc.
801 E. Tahquitz Canyon Way
Palm Springs, CA 92262
With a copy to: Jeffrey P. Kranzdorf, Esq.
18410 St. Moritz Dr.
Tarzana, CA 91356
or such other addresses as shall be furnished in writing by any party in the
manner for giving notices hereunder, and any such notice or communication shall
be deemed to have been given as of the date so delivered, mailed, or
telegraphed.
Section 7.4 Attorneys' Fees. In the event that any party institutes any
action or suit to enforce this Agreement or to secure relief from any default
hereunder or breach hereof, the breaching party or parties shall reimburse the
non-breaching party or parties for all costs, including reasonable attorneys'
fees, incurred in connection therewith and in enforcing or collecting any
judgment rendered therein.
Section 7.5 Confidentiality. Each party hereto agrees with the other
parties that, unless and until the transaction contemplated by this Agreement
has been consummated, they and their representatives will hold in strict
confidence all data and information obtained with respect to another party or
any subsidiary thereof from any representative, officer, director or employee,
or from any books or records or from personal inspection, of such other party,
and shall not use such data or information or disclose the same to others,
except: (i) to the extent such data is a matter of public knowledge or is
required by law to be published; and (ii) to the extent that such data or
information must be used or disclosed in order to consummate the transactions
contemplated by this Agreement.
Section 7.6 Schedules; Knowledge. Each party is presumed to have full
knowledge of all information set forth in the other party's schedules delivered
pursuant to this Agreement.
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Section 7.7 Third Party Beneficiaries. This contract is solely among
3PM and Shadowrock and, except as specifically provided, no director, officer,
stockholder, employee, agent, independent contractor or any other person or
entity shall be deemed to be a third party beneficiary of this Agreement.
Section 7.8 Entire Agreement. This Agreement represents the entire
agreement between the parties relating to the subject matter hereof. This
Agreement alone fully and completely expresses the agreement of the parties
relating to the subject matter hereof. There are no other courses of dealing,
understandings, agreements, representations or warranties, written or oral,
except as set forth herein. This Agreement may not be amended or modified,
except by a written agreement signed by all parties hereto.
Section 7.9 Survival; Termination. The representations, warranties and
covenants of the respective parties shall survive the Closing Date and the
consummation of the transactions herein contemplated for 18 months.
Section 7.10 Counterparts Facsimile Execution. For purposes of this
Agreement, a document (or signature page thereto) signed and transmitted by
facsimile machine or telecopier is to be treated as an original document. The
signature of any party thereon, for purposes hereof, is to be considered as an
original signature, and the document transmitted is to be considered to have the
same binding effect as an original signature on an original document. At the
request of any party, a facsimile or telecopy document is to be re-executed in
original form by the parties who executed the facsimile or telecopy document. No
party may raise the use of a facsimile machine or telecopier machine as a
defense to the enforcement of the Agreement or any amendment or other document
executed in compliance with this Section.
Section 7.11 Amendment or Waiver. Every right and remedy provided
herein shall be cumulative with every other right and remedy, whether conferred
herein, at law, or in equity, and may be enforced concurrently herewith, and no
waiver by any party of the performance of any obligation by the other shall be
construed as a waiver of the same or any other default then, theretofore, or
thereafter occurring or existing. At any time prior to the Closing Date, this
Agreement may be amended by a writing signed by all parties hereto, with respect
to any of the terms contained herein, and any term or condition of this
Agreement may be waived or the time for performance hereof may be extended by a
writing signed by the party or parties for whose benefit the provision is
intended.
Section 7.12 Incorporation of Recitals. All of the recitals hereof are
incorporated by this reference and are made a part hereof as though set forth at
length herein.
Section 7.13 Expenses. Each party herein shall bear all of their
respective costs and expenses incurred in connection with the negotiation of
this Agreement and in the consummation of the transactions provided for herein
and the preparation therefor.
Section 7.14 Headings; Context. The headings of the sections and
paragraphs contained in this Agreement are for convenience of reference only and
do not form a part hereof and in no way modify, interpret or construe the
meaning of this Agreement.
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Section 7.15 Benefit. This Agreement shall be binding upon and shall
insure only to the benefit of the parties hereto, and their permitted assigns
hereunder. This Agreement shall not be assigned by any party without the prior
written consent of the other party.
Section 7.16 Public Announcements. Except as may be required by law,
neither party shall make any public announcement or filing with respect to the
transactions provided for herein without the prior consent of the other party
hereto.
Section 7.17 Severability. In the event that any particular provision
or provisions of this Agreement or the other agreements contained herein shall
for any reason hereafter be determined to be unenforceable, or in violation of
any law, governmental order or regulation, such unenforceability or violation
shall not affect the remaining provisions of such agreements, which shall
continue in full force and effect and be binding upon the respective parties
hereto.
Section 7.18 Failure of Conditions; Termination. In the event any of
the conditions specified in this Agreement shall not be fulfilled on or before
the Closing Date, either of the parties have the right either to proceed or,
upon prompt written notice to the other, to terminate and rescind this Agreement
without liability to any other party. The election to proceed shall not affect
the right of such electing party reasonably to require the other party to
continue to use its efforts to fulfill the unmet conditions.
Section 7.19 No Strict Construction. The language of this Agreement
shall be construed as a whole, according to its fair meaning and intendment, and
not strictly for or against either party hereto, regardless of who drafted or
was principally responsible for drafting the Agreement or terms or conditions
hereof.
Section 7.20 Execution Knowing and Voluntary. In executing this
Agreement, the parties severally acknowledge and represent that each: (a) has
fully and carefully read and considered this Agreement; (b) has been or has had
the opportunity to be fully apprised of its attorneys of the legal effect and
meaning of this document and all terms and conditions hereof; and (c) is
executing this Agreement voluntarily, free from any influence, coercion or
duress of any kind.
Section 7.21 Force Majeure. Neither party hereto shall be liable to the
other for any failure to perform or a delay in performance of its obligations
hereunder caused by an Act Of God, outbreak of hostilities, riots, civil
disturbance, act of terrorism, the act of any government or authority (including
any revocation of any license or consent), fire, explosion, flood, fog or bad
weather, default of suppliers or sub-contractors, theft, malicious damage,
strike, lock-out or industrial action of any kind, cause or circumstance beyond
its reasonable control.
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IN WITNESS WHEREOF, the corporate parties hereto have caused this
Agreement to be executed by their respective officers, hereunto duly authorized,
and entered into as of the date first above written.
3PM HOLDING CORP.
ATTEST:
s/Gregory W. Skufca s/Gregory J. Simonds
____________________________________ By:_________________________________
Secretary or Assistant Secretary Gregory J. Simonds, President
ATTEST: SHADOWROCK ENTERTAINMENT, INC.
s/Greg McDonald s/Greg McDonald
____________________________________ By: ________________________________
Secretary or Assistant Secretary
Its: President
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EXHIBIT "A" TO THE AGREEMENT DATED
OCTOBER 29, 1999
ENTERED INTO BY AND BETWEEN SHADOWROCK ENTERTAINMENT, INC. AND
3PM, INC.
(THIS EXHIBIT CONSISTS OF TWO [2] PAGES)
Herman's Hermits Greatest Hits
Peter Noone
I'm Into Something Good
Wonderful World
Listen People
Dandy
A Must To Avoid
No Milk Today
Steady Eddie
God Knows
Leaning On A Lampost
Silhouettes
Don't Say It
Needles And Pins
Just A Little Bit Better
End Of The World
Jezabelle
A Kind Of Hush
Mrs. Brown (You've Got A Lovely Daughter)
I'm Henry The VIII, I Am!
Rick Nelson All My Best
Travelin' Man
Hello Mary Lou
Stood Up
Garden Party
It's Late
You Know What I Mean
Young World
Lonesome Town
I Got A Feeling
Don't Leave Me This Way
Believe What You Say
Poor Little Fool
Never Be Anyone Else But You
You Are The Only One
Just A Little Too Much
It's Up To You
Waitin' In School
Fools Rush In
23
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Teenage Idol
I'm Walkin'
Mighty Good
Sweeter Than You
Rockin' The Night Away
The Mamas & The Papas Monday, Monday
Donovan Mellow, Yellow
Terry Stafford Suspicion
Peter Noone Can't You Hear My Heartbeat
Jan & Dean The Little Old Lady (From Pasadena)
Donovan Sunshine Superman
The Grass Roots Midnight Confessions
Peter Noone I'm Into Something Good
Ray Peterson Corrina, Corrina
The Grass Roots Temptation Eyes
Jan & Dean Surf City
Tommy James & The Shondells Hanky Panky
Tommy James & The Shondells I Think We're Alone Now
Tommy James & The Shondells Mony, Mony
Sonny Bono I Got You Babe
The Mamas & The Papas Straight Shooter
The Mamas & The Papas Mississippi
The Mamas & The Papas Sunday Will Never Be The Same
The Mamas & The Papas GoWhere You Wanna Go
The Mamas & The Papas Dream A Little Dream Of Me
Jan & Dean Deadman's Curve
Jan & Dean Surf City
Jan & Dean Drag City
Jan & Dean Sidewalk Surfin'
Sonny Bono The Beat Goes On
Sonny Bono All I Ever Need Is You
Tommy James & The Shondells Crimson & Clover
Tommy James & The Shondells Crystal Blue Persuasion
Tommy James & The Shondells Dragging The Line
Terry Stafford Suspicion
Ray Peterson The Wonder of You
Peter Noone Mrs. Brown
Peter Noone There's A Kind Of Hush
Peter Noone I'm Henry The VIII, I Am!
Peter Noone Silhouettes
Peter Noone Listen People
The Grass Roots Let's Live For Today
The Grass Roots Sooner Or Later
The Grass Roots I'd Wait A Million Years
The Grass Roots Two Divided By Love
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EXHIBIT "B"
__________________
FORM OF INVESTMENT LETTER
__________________
25
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INVESTMENT LETTER
October , 1999
3PM Holding Corp.
5650 Greenwood Plaza Blvd.
Suite 216
Englewood, Colorado 80111
Gentlemen:
The undersigned, in acceptance of and subject to the terms and conditions of
that certain Agreement (the "Agreement"), between 3PM Holding Corp., a Colorado
corporation (the "Company") and Shadowrock Entertainment, Inc., a California
corporation, dated October , 1999, wherein the Company has agreed to issue
13,000,000 shares of its $0.0001 par value per share common stock in exchange
for certain assets more fully described in the Agreement (the "Shares"), the
undersigned hereby represents, warrants, covenants and agrees with the Company
that, in connection with the undersigned's acceptance of the Shares and as of
the date of this letter:
1. The undersigned is aware that its acceptance of the Shares is
irrevocable, absent an extension of the Expiration Date of any material change
to any of the terms and conditions of the Agreement.
2. The undersigned has full power and authority to enter into this
Agreement and that this Agreement constitutes a valid and legally binding
obligation of the undersigned.
3. By execution hereof, the undersigned hereby confirms that the
Company's common stock to be received in exchange for the Assets will be
acquired for investment for the undersigned's own account, not as a nominee or
agent, and not with a view to the resale or distribution of any part thereof,
and that the undersigned has no present intention of selling, granting any
participation in, or otherwise distributing the same. By execution hereof, the
undersigned further represents the undersigned does not have any contract,
undertaking, agreement or arrangement with any third party, with respect to any
of the Shares.
4. The undersigned understands that the Shares are being issued
pursuant to available exemption thereto and have not been registered under the
Securities Act of 1933, as amended (the "1933 Act"), or under any state
securities laws. The undersigned understands that no registration statement has
been filed with the United States Shares and Exchange Commission nor with any
other regulatory authority and that, as a result, any benefit which might
normally accrue to a holder such as the undersigned by an impartial review of
such a registration statement by the Securities and Exchange Commission or other
regulatory authority will not be forthcoming. The undersigned understands that
it cannot sell the Shares unless such sale is registered under the 1933 Act and
applicable state securities laws or exemptions from such registration become
available. In this connection the undersigned understands that the Company has
advised the Transfer Agent for its securities that the Shares are subject to the
"restricted period" under the 1933 Act and that they may not be transferred by
me to any person without the prior consent of the Company, which consent of the
Company will require an opinion of counsel acceptable to the Company to the
effect that, in the event the Shares are not registered under the 1933 Act, any
transfer as may be
26
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3PM Holding Corp.
October , 1999
Page 2
proposed by me must be entitled to an exemption from the registration provisions
of the 1933 Act. To this end, I acknowledge that a legend to the following
effect will be placed upon the certificate representing the Shares and that the
Transfer Agent has been advised of such facts:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"), AND MAY BE OFFERED AND SOLD ONLY IF
REGISTERED PURSUANT TO THE PROVISIONS OF THE ACT IS AVAILABLE OR IF
ANOTHER EXEMPTION FROM REGISTRATION THEREUNDER IS AVAILABLE, THE
AVAILABILITY OF WHICH MUST BE ESTABLISHED TO THE SATISFACTION OF THE
COMPANY.
The undersigned understands that the foregoing legend on its
certificate for the Shares limits their value, including their value as
collateral.
6. The undersigned represents that it is experienced in evaluation and
investing in securities of companies in the development stage and acknowledges
that it is able to fend for itself, can bear the economic risk of this
investment and has such knowledge and experience in financial and business
matters that it is capable of evaluating the merits and risks of the investment
in the Shares.
In Witness Whereof, the undersigned has duly executed this Investment
Letter as of the date indicated hereon.
Dated: October , 1999
Very truly yours,
SHADOWROCK ENTERTAINMENT, INC.
By:_____________________________________
Its: ____________________________________
- ---------------------------------------
(print name in full)
- ---------------------------------------
(street address)
- ---------------------------------------
(city, state, zip)
- ---------------------------------------
(employer identification no.)
