Document:

fsb2a10807ex10x_redrock.htm

    FINANCING
      AGREEMENT

     

    This
      Agreement is made as of this 31st day of October, 2006, by and between Ratko
      Productions, Inc, ("Ratko") a wholly owned subsidiary of National Lampoon,
      Inc.., a Delaware corporation ("NL") and Red Rock Productions, Inc., a Nevada
      corporation ("RRP") regarding financing arrangements for a theatrical motion
      pictures ("Picture") to be distributed by NL as follows:

     

    1.  Loan:
      RRP
      agrees to loan RATKO funding for each Picture in an amount not to exceed Two
      Million Dollars ($2,000,000.00) (unless otherwise agreed to in writing by the
      parties), with payments to be made on an approved cash flow provided by
      RATKO.

     

    2.  Recoupment
      of Investment: RRP will be entitled to recoup its investment plus interest
      at
      ten percent (10%) with interest accruing on the average daily balance from
      the
      date of the loan is provided to RATKO.

     

    3.  Security
      Interest: RRP will have a security interest in the Picture to the extent of
      the
      actual amount of the funding and as long as there is an unpaid balance on the
      loan. The security interest will be relinquished by RRP when the loan has been
      repaid in full.

     

    4.  Contingent
      Participation: RRP will be entitled to twenty-five percent (25%) of all net
      contingent proceeds from the Picture.

     

    5   Budget:
      It is intended
      that the direct cash cost budget of the Picture be $2,600,000 or less, inclusive
      of non-reimbursable overhead and pre-production expenses incurred by RATKO.
      ("Budget Cost").

     

    6.   Representations
      and
      Warranties: RATKO hereby represents and warrants to RRP that:

     

    (a)  Powers
      and Authority: It is duly incorporated, validly existing and in good standing.
      It has the corporate power and all necessary rights and title to enter into
      and
      perform this Agreement and the transactions contemplated hereby or referred
      to
      herein and has taken all necessary action to authorize the entry into and
      performance of this Agreement and such transactions.

     

    (b)  Legal
      Validity: This Agreement constitutes a legal, valid and binding obligation
      of
      RATKO and is in proper form for enforcement against it.

     

    (c)   Non-Conflict
      With Laws:
      To the best of RATKO's knowledge, the entry into and performance of this
      Agreement and the transactions contemplated hereby do not and will not conflict
      with: (i) any existing law or regulation or any official or judicial order,
      or
      (ii) its articles of incorporation, or (iii) any agreement or document to which
      it is a party or which is binding upon it or any of its assets.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Without
      limiting the generality of the foregoing, RATKO represents and warrants that
      to
      the best of its knowledge, there are not now any liens, claims, encumbrances,
      legal proceedings,
      restrictions, agreements or understandings which might conflict or interfere
      with, limit, derogate from, or be inconsistent with or otherwise affect any
      of
      the provisions of this Agreement or any of the representations or warranties
      of
      RATKO contained herein, including without limitation, any U.C.C. filings,
      copyright assignments or other liens, inconsistent herewith or offsets or other
      costs charged against the Picture by any distributor pursuant to
      cross-collateralization agreements or otherwise.

     

    (d)  Consents:
      All authorizations, approvals, consents, licenses, exemptions, filings,
      registrations, notarizations and other matters, official or otherwise, required
      or advisable in connection with the entry into, performance, validity and
      enforceability of this Agreement and the transactions contemplated hereby RATKO
      have been or will be obtained or effected and are or will be in full force
      and
      effect (other than the registration of security interests to be created pursuant
      hereto).

     

    (e)  Litigation:
      No litigation, arbitration or administrative proceedings are threatened or,
      to
      its knowledge, pending which call into question the validity or performance
      of
      its obligations hereunder.

     

    (f)   Survival:
      The Production
      Company's warranties, representations and agreements are of the essence of
      this
      Agreement and shall survive the early termination hereof. None of the Production
      Company's warranties, representations or agreements shall in any way be limited
      by reason of any investigation made by NL or on behalf of NL regarding
      said

    warranties,
      representations or agreements.

     

    7.  Indemnification
      by RATKO: RATKO shall, at its own expense, indemnify, save and hold harmless
      RRP
      and its successors, licensees, assigns, agents, representatives and affiliates
      from and against any and all claims, demands, causes of action, obligations,
      liability, loss, damage, cost and expenses (including reasonable attorneys'
      fees), incurred or sustained by reason of or arising out of any breach or
      alleged breach of any of the warranties, representations or agreements herein
      made by RATKO, or from any reliance upon any such warranties, representations
      or
      agreements. If any person or entity shall make any claim or institute any suit
      or proceeding alleging any facts, which, if true, would constitute a breach
      by
      RATKO of any warranty, representation or agreement herein made, RATKO shall
      give
      prompt written notice of same to NL and RATKO shall undertake at its own cost
      and expense the defense thereof and shall supply competent and experienced
      counsel to defend any such suit or proceeding. RRP may also engage his own
      counsel in connection with any such suit or proceeding.

     

    8.  Accounting
      and Reports by RATKO:

     

    (a)
      RATKO
      shall maintain complete books and records with respect to the distribution
      and
      exploitation of the Picture. RATKO shall render to RRP, on a semi-annual basis
      for the first two years after initial distribution of the Picture, a written
      statement of monies due RRP hereunder, if any ("RRP Statement"), and such RRP
      Statement shall be accompanied by remittance of any amount shown to be due
      to
      RRP thereon. Thereafter, RRP Statements and payments shall be provided annually
      for as long as the Picture generates
      net profits. 

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    If
      any
      error is made by RATKO in any RRP Statement, it may be corrected by RATKO within
      two (2) years thereafter by making any necessary deductions or additions on
      subsequent RRP Statements, or at RATKO's option by rendering an Amended NL
      Statement. Each RRP Statement shall be rendered within ninety (90) days
      following the end of each accounting period. Any RRP Statement rendered by
      RATKO
      hereunder shall be deemed conclusively true and correct and binding upon RRP,
      shall constitute an account stated and be incontestable unless RRP delivers
      to
      RATKO in writing specific objections, setting forth specific transactions or
      items objected to and the basis of such objections, within one (1) year from
      the
      date of such RRP Statement. Any recovery by RRP shall be limited to those items
      specifically objected to in writing by RRP within said one (1) year
      period.

     

    (b)  RRP
      shall
      have the right to examine to the extent they pertain to the Picture, the books
      and records of RATKO. In addition, RATKO shall cause NL, as the distributor
      to
      grant rights to examine its books and records to the extent they pertain to
      the
      Picture. . Such examination shall be made during reasonable business hours,
      upon
      reasonable advance written notice, at the regular place of business of RATKO
      where such books and records are maintained, and shall be conducted on RRP's
      behalf and at RRP's expense by the RRP's designee. Such examination shall not
      be
      made more frequently than annually and no more than once with respect to any
      accounting period or RRP Statement rendered hereunder. With respect to any
      accounting period for which an RRP Statement has been rendered by RRP, such
      examination shall be permitted only for a period of one year from the date
      such
      RRP Statement was received by RRP. RRP's examination shall be limited to those
      records relating to the Picture and under no circumstances shall RRP have the
      right to examine records relating to RATKO's business generally or relating
      to
      other motion pictures for purposes of comparison or otherwise.

     

    (c)  No
      action, suit or proceeding arising out of this Agreement or concerning RRP
      Statement or other accounting rendered by RATKO hereunder or to the period
      of
      time to which such RRP Statement or accounting relates may be maintained against
      RATKO unless commenced within one (1) year after the date such RRP Statement
      or
      accounting is received by RRP.

     

    8.  Business
      Opportunities: Each of the parties acknowledges that neither party will in
      any
      way be restricted from any other business activity (including any motion picture
      activity), whether or not competitive to the Pictures produced pursuant to
      this
      Agreement, it being agreed that so-called "corporate and/or joint venture
      opportunities" or fiduciary opportunities in relation to any such other
      activities are hereby waived by each of the parties.

     

    9.  Additional
      Documents: Each of the parties agree to execute any additional documents which
      may be required or be desirable to fully effectuate the purposes and intent
      of
      this Agreement or to carry out the obligations of the parties hereunder,
      provided that they are not inconsistent with the provisions of this
      Agreement.

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    10.  Notices:
      All notices hereunder shall be in writing and shall be served by personal
      delivery to RRP or the Production Company, as the case may be, or by registered
      or certified mail, return receipt requested, or by telegram or FAX, addressed
      as
      follows:

     

    Ratko
      Productions, Inc.

    8228
      Sunset Boulevard, Los Angeles, CA 90046 

    Attn:
      Daniel Laikin

     

    Red
      Rock
      Productions, Inc.

    8228
      Sunset Boulevard, Los Angeles, CA 90046 

    Attn:
      Robert Levy

     

    Any
      party
      may change its address at any time by written notice to the other parties.
      Notices served by mail shall be deemed to be served three (3) business days
      next
      following deposit in the U.S. mails, and in the case of telegrams on the next
      business day following delivery of the notice to the telegraph office, charges
      prepaid.

     

    11.  Assignment:
      RATKO shall have the right to assign all or any part of its right or obligations
      hereunder to any third party. RRP shall have no rights to assign without RATKO's
      consent. Nothing contained in this sentence shall prevent any party from
      assigning its right to receive monies hereunder.

     

    12.
      Miscellaneous:

     

    (a)  This
      Agreement may not be modified except by written agreement signed by each of
      the
      parties hereto.

     

    (b)  This
      Agreement shall in no event be construed as a third party beneficiary contract
      and is not intended for the benefit of any person or company whomsoever except
      the parties hereto.

     

    (c)  No
      waiver
      by one party of a breach or default by the other party shall be deemed to be
      a
      waiver of any preceding, continuing or succeeding breach of the same or any
      other provision of this Agreement.

     

    (d)  Each
      party acknowledges that no representation or warranty not expressly set forth
      in
      this Agreement has been made or relied upon by the other party, it being agreed
      that this Agreement constitutes the entire Agreement of the parties regarding
      the subject matter hereof and supersedes all prior Agreements with respect
      thereto.

     

    (e)  This
      Agreement has been entered into in the State of California and shall be
      construed and enforced under and subject to the laws of said state.

     

    (f)  Should
      there be any dispute between the parties concerning the interpretation of this
      Agreement or concerning an alleged breach of this Agreement, which the parties
      are unable to resolve after consultation with each other, such dispute shall
      be
      decided by arbitration pursuant to the regulations and procedures of the
      American Arbitration Association.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    The
      parties agree that any award rendered by the American Arbitration Association
      may be entered in the appropriate state or federal court located within the
      state of California.

     

    18.
      Attorneys' Fees: In any action or proceeding between or among the parties hereto
      to interpret or enforce any of the provisions hereof, the prevailing party
      shall, in addition to any other award of damages or other remedy, be entitled
      to
      reasonable attorneys' fees and costs.

     

    WHEREFORE,
      the parties have executed this Agreement on the date first above written.

     

     

    Ratko
      Productions, Inc.

     

     

    By:  /s/ 
      Daniel S. Laikin        

     

    Its:
      CEO

     

    Red
      Rock
      Productions, Inc.

     

    By:  /s/
      Robert L. Levy      

     

    Its:  Presidentfsb2a10807ex10xi_redrock.htm

    FINANCING
      AGREEMENT

     

    This
      Agreement is made as of this 31st day of October, 2006, by and between Bag
      Boy
      Productions, Inc, ("BBP") a wholly owned subsidiary of National Lampoon, Inc..,
      a Delaware corporation ("NL") and Red Rock Productions, Inc., a Nevada
      corporation ("RRP") regarding financing arrangements for a theatrical motion
      pictures ("Picture") to be distributed by NL as follows:

     

    1.  Loan:
      RRP
      agrees to loan BBP funding for each Picture in an amount not to exceed Two
      Million Dollars ($2,000,000.00) (unless otherwise agreed to in writing by the
      parties), with payments to be made on an approved cash flow provided by
BBP.

     

    2.  Recoupment
      of Investment: RRP will be entitled to recoup its investment plus interest
      at
      ten percent (10%) with interest accruing on the average daily balance from
      the
      date of the loan is provided to BBP.

     

    3.  Security
      Interest: RRP will have a security interest in the Picture to the extent of
      the
      actual amount of the funding and as long as there is an unpaid balance on the
      loan. The security interest will be relinquished by RRP when the loan has been
      repaid in full.

     

    4.  Contingent
      Participation: RRP will be entitled to twenty-five percent (25%) of all net
      contingent proceeds from the Picture.

     

    5   Budget:
      It is intended
      that the direct cash cost budget of the Picture be $2,500,000 or less, inclusive
      of non-reimbursable overhead and pre-production expenses incurred by BBP.
      ("Budget Cost").

     

    6.   Representations
      and
      Warranties: BBP hereby represents and warrants to RRP that:

     

    (a)  Powers
      and Authority: It is duly incorporated, validly existing and in good standing.
      It has the corporate power and all necessary rights and title to enter into
      and
      perform this Agreement and the transactions contemplated hereby or referred
      to
      herein and has taken all necessary action to authorize the entry into and
      performance of this Agreement and such transactions.

     

    (b)  Legal
      Validity: This Agreement constitutes a legal, valid and binding obligation
      of
      BBP and is in proper form for enforcement against it.

     

    (c)   Non-Conflict
      With Laws:
      To the best of BBP's knowledge, the entry into and performance of this Agreement
      and the transactions contemplated hereby do not and will not conflict with:
      (i)
      any existing law or regulation or any official or judicial order, or (ii) its
      articles of incorporation, or (iii) any agreement or document to which it is
      a
      party or which is binding upon it or any of its assets.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Without
      limiting the generality of the foregoing, BBP represents and warrants that
      to
      the best of its knowledge, there are not now any liens, claims, encumbrances,
      legal proceedings,
      restrictions, agreements or understandings which might conflict or interfere
      with, limit, derogate from, or be inconsistent with or otherwise affect any
      of
      the provisions of this Agreement or any of the representations or warranties
      of
      BBP contained herein, including without limitation, any U.C.C. filings,
      copyright assignments or other liens, inconsistent herewith or offsets or other
      costs charged against the Picture by any distributor pursuant to
      cross-collateralization agreements or otherwise.

     

    (d)  Consents:
      All authorizations, approvals, consents, licenses, exemptions, filings,
      registrations, notarizations and other matters, official or otherwise, required
      or advisable in connection with the entry into, performance, validity and
      enforceability of this Agreement and the transactions contemplated hereby BBP
      have been or will be obtained or effected and are or will be in full force
      and
      effect (other than the registration of security interests to be created pursuant
      hereto).

     

    (e)  Litigation:
      No litigation, arbitration or administrative proceedings are threatened or,
      to
      its knowledge, pending which call into question the validity or performance
      of
      its obligations hereunder.

     

    (f)   Survival:
      The
      Production Company's warranties, representations and agreements are of the
      essence of this Agreement and shall survive the early termination hereof. None
      of the Production Company's warranties, representations or agreements shall
      in
      any way be limited by reason of any investigation made by NL or on behalf of
      NL
      regarding said

    warranties,
      representations or agreements.

     

    7.  Indemnification
      by BBP: BBP shall, at its own expense, indemnify, save and hold harmless RRP
      and
      its successors, licensees, assigns, agents, representatives and affiliates
      from
      and against any and all claims, demands, causes of action, obligations,
      liability, loss, damage, cost and expenses (including reasonable attorneys'
      fees), incurred or sustained by reason of or arising out of any breach or
      alleged breach of any of the warranties, representations or agreements herein
      made by BBP, or from any reliance upon any such warranties, representations
      or
      agreements. If any person or entity shall make any claim or institute any suit
      or proceeding alleging any facts, which, if true, would constitute a breach
      by
BBP
      of any warranty, representation or agreement herein made, BBP
      shall give prompt written notice of same to NL and BBP shall undertake at its
      own cost and expense the defense thereof and shall supply competent and
      experienced counsel to defend any such suit or proceeding. RRP may also engage
      his own counsel in connection with any such suit or proceeding.

     

    8.  Accounting
      and Reports by BBP:

     

    (a)
      BBP
      shall maintain complete books and records with respect to the distribution
      and
      exploitation of the Picture. BBP shall render to RRP, on a semi-annual basis
      for
      the first two years after initial distribution of the Picture, a written
      statement of monies due RRP hereunder, if any ("RRP Statement"), and such RRP
      Statement shall be accompanied by remittance of any amount shown to be due
      to
      RRP thereon. Thereafter, RRP Statements and payments shall be provided annually
      for as long as the Picture generates net profits.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    If
      any
      error is made by BBP in any RRP Statement, it may be corrected
      by BBP within two (2) years thereafter by making any necessary deductions or
      additions on subsequent RRP Statements, or at BBP's option by rendering an
      Amended NL Statement. Each RRP Statement shall be rendered within ninety (90)
      days following the end of each accounting period. Any RRP Statement rendered
      by
      BBP hereunder shall be deemed conclusively true and correct and binding upon
      RRP, shall constitute an account stated and be incontestable unless RRP delivers
      to BBP in writing specific objections, setting forth specific transactions
      or
      items objected to and the basis of such objections, within one (1) year from
      the
      date of such RRP Statement. Any recovery by RRP shall be limited to those items
      specifically objected to in writing by RRP within said one (1) year
      period.

     

    (b)  RRP
      shall
      have the right to examine to the extent they pertain to the Picture, the books
      and records of BBP. In addition, BBP shall cause NL, as the distributor to
      grant
      rights to examine its books and records to the extent they pertain to the
      Picture. . Such examination shall be made during reasonable business hours,
      upon
      reasonable advance written notice, at the regular place of business of BBP
      where
      such books and records are maintained, and shall be conducted on RRP's behalf
      and at RRP's expense by the RRP's designee. Such examination shall not be made
      more frequently than annually and no more than once with respect to any
      accounting period or RRP Statement rendered hereunder. With respect to any
      accounting period for which an RRP Statement has been rendered by RRP, such
      examination shall be permitted only for a period of one year from the date
      such
      RRP Statement was received by RRP. RRP's examination shall be limited to those
      records relating to the Picture and under no circumstances shall RRP have the
      right to examine records relating to BBP's business generally
      or relating to other motion pictures for purposes of comparison or
      otherwise.

     

    (c)  No
      action, suit or proceeding arising out of this Agreement or concerning RRP
      Statement or other accounting rendered by BBP hereunder or to
      the period of time to which such RRP Statement or accounting relates may be
      maintained against BBP unless commenced within one (1) year after the date
      such
      RRP Statement or accounting is received by RRP.

     

    8.  Business
      Opportunities: Each of the parties acknowledges that neither party will in
      any
      way be restricted from any other business activity (including any motion picture
      activity), whether or not competitive to the Pictures produced pursuant to
      this
      Agreement, it being agreed that so-called "corporate and/or joint venture
      opportunities" or fiduciary opportunities in relation to any such other
      activities are hereby waived by each of the parties.

     

    9.  Additional
      Documents: Each of the parties agree to execute any additional documents which
      may be required or be desirable to fully effectuate the purposes and intent
      of
      this Agreement or to carry out the obligations of the parties hereunder,
      provided that they are not inconsistent with the provisions of this
      Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    10.  Notices:
      All notices hereunder shall be in writing and shall be served by personal
      delivery to RRP or the Production Company, as the case may be, or by registered
      or certified mail, return receipt requested, or by telegram or FAX, addressed
      as
      follows:

     

    Bagboy
      Productions, Inc.

    8228
      Sunset Boulevard, Los Angeles, CA 90046 

    Attn:
      Daniel Laikin

     

    Red
      Rock
      Productions, Inc.

    8228
      Sunset Boulevard, Los Angeles, CA 90046 

    Attn:
      Robert Levy

     

    Any
      party
      may change its address at any time by written notice to the other parties.
      Notices served by mail shall be deemed to be served three (3) business days
      next
      following deposit in the U.S. mails, and in the case of telegrams on the next
      business day following delivery of the notice to the telegraph office, charges
      prepaid.

     

    11.  Assignment:
      BBP shall have the right to assign all or any part of its right or obligations
      hereunder to any third party. RRP shall have no rights to assign without BBP's
      consent. Nothing contained in this sentence shall prevent any party from
      assigning its right to receive monies hereunder.

     

    12.   Miscellaneous:

     

    (a)  This
      Agreement may not be modified except by written agreement signed by each of
      the
      parties hereto.

     

    (b)  This
      Agreement shall in no event be construed as a third party beneficiary contract
      and is not intended for the benefit of any person or company whomsoever except
      the parties hereto.

     

    (c)  No
      waiver
      by one party of a breach or default by the other party shall be deemed to be
      a
      waiver of any preceding, continuing or succeeding breach of the same or any
      other provision of this Agreement.

     

    (d)  Each
      party acknowledges that no representation or warranty not expressly set forth
      in
      this Agreement has been made or relied upon by the other party, it being agreed
      that this Agreement constitutes the entire Agreement of the parties regarding
      the subject matter hereof and supersedes all prior Agreements with respect
      thereto.

     

    (e)  This
      Agreement has been entered into in the State of California and shall be
      construed and enforced under and subject to the laws of said state.

     

    (f)  Should
      there be any dispute between the parties concerning the interpretation of this
      Agreement or concerning an alleged breach of this Agreement, which the parties
      are unable to resolve after consultation with each other, such dispute shall
      be
      decided by arbitration pursuant to the regulations and procedures of the
      American Arbitration Association.

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    The
      parties agree that any award rendered by the American Arbitration Association
      may be entered in the appropriate state or federal court located within the
      state of California.

     

    18.
      Attorneys' Fees: In any action or proceeding between or among the parties hereto
      to interpret or enforce any of the provisions hereof, the prevailing party
      shall, in addition to any other award of damages or other remedy, be entitled
      to
      reasonable attorneys' fees and costs.

     

    WHEREFORE,
      the parties have executed this Agreement on the date first above
      written.

     

    BagBoy
      Productions, Inc.

     

    
      
        By:  /s/ 
          Daniel S. Laikin        

         

        Its:
          CEO

         

        Red
          Rock
          Productions, Inc.

         

        By:  /s/
          Robert L. Levy            

         

        Its:  President

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