Option Agreement Draft of 25 March 2003R

Agreement, executed on the day below written, is by and between the undersigned, dNa DevelopMent (a division of Matrixx Entertainment Corporation (hereinafter "dNa," "dNa DevelopMent" or the "Company"), and you with respect to your unpublished literary work tentatively entitled ("Working Title" or "Screenplay Working Title") which, together with themes, characters, contents, alternate titles and other versions thereof, is hereinafter called the "Screenplay" or "Property"), written by (hereinafter "Writer" or "Writer Legal Realname" and collectively as the "Parties"), and based upon a story by same, as follows:

1. CONSIDERATION AND TERM: In consideration of the sum of One Dollar ($1.00), and other good and valuable consideration, receipt of which Writer hereby acknowledges, Writer grants to the Company a non-exclusive and irrevocable option to purchase all motion picture, television and allied rights in the Property ("Option"), such option period commencing on the date hereof ("Commencement Date") and continuing for sixty (60) months ("Term").

2. TERMINATION: The Company may terminate this Option Agreement at its volition, by mailing or emailing written notice to Writer at any time.

a) dNa reserves the right to update or modify this Option Agreement by publishing any changes at this URL on the Internet.

b) dNa will honor any and all Option Agreements exectued between the Parties, until and unless modified by the Parties in writing or terminated by the Company.

3. CONVERSION AND EXTENSIONS: At any time during the Option Term the Company may convert the non-exclusive Option to an exclusive option ("Exclusive Option") for a twenty-four (24) -month period by payment of $1,200.00 to Writer, such fee payable in a lump sum or, at dNa's preference, in monthly installments of $50.00 on or before the last day of each month.

a) In the event Writer does not receive payment on or before the agreed upon day each month, Writer may cancel this Option Agreement or convert it back to non-exclusive status for the balance of the Term by mailing or emailing written notice to dNa.

b) dNa retains the right, but not the obligation, to purchase from the Writer up to two (2) Extensions of the Exclusive Option, the first at the rate of $2,400.00 per year and the second at the rate of $5,000.00 per year.

4. PURCHASE PRICE: If dNa exercises its option, the Company will pay Writer the following additional sums ("Purchase Price") for all of the rights granted it herein and for all of Writer's representations and warranties hereunder:

a) Three Hundred Thousand Dollars ($300,000.00), payable if and when dNa, or its assign, exercises its option under Paragraph 1 within thirty-six (36) months of the Commencement Date, or;

b) Six Hundred Thousand Dollars ($600,000.00), payable if and when dNa, or its assign, exercises its option under Paragraph 1 any time after thirty-six (36) months (1,095 days) from the Commencement Date, and;

c) Twenty Five Thousand Dollars ($25,000.00), payable if and when the Rights or any motion picture or remake based upon the Property earns in excess of One Million Dollars ($1,000,000.00) in each and any fiscal year subsequent to the release date of said motion picture.

5. WRITER'S REPRESENTATIONS: Writer hereby represents and warrants that: (a) the Property was written solely by and is original with Writer; (b) Writer owns all right, title and interest in and to the story; (c) neither the Property nor any element thereof infringes upon any other literary property; (d) the production or exploitation of any motion picture or other production based on the Property will not violate the right to privacy of any person or constitute a defamation against any person, nor will production or exploitation of any motion picture or other production based thereon in any other way violate the rights of any person whomsoever; (e) Writer owns all rights in the Property free and clear of any liens, encumbrances, claims or litigation, whether pending or threatened; (f) Writer has full right, power and authority to make and perform this Agreement; (g) the Property has not previously been exploited as a motion picture, television production, play or otherwise, and no rights have been granted to any third party to do so; (h) all facts represented by Writer herein (as well as the Literary Property Submission Release, if any), are true and accurate. Writer hereby indemnifies the Company against any loss or damage (including reasonable attorney's fees) incurred by reason of any breach or claim of breach of the foregoing representations, warranties and any and all agreements herein. The term "person" as used herein shall mean any person, firm, corporation or other entity.

6. RIGHTS GRANTED: The foregoing Option covers the sole, exclusive, perpetual and universe-wide motion picture, television and allied and incidental rights in the Property (and any and all screenplays or other adaptations thereof) including theatrical, television (whether filmed, taped, computer animated or otherwise recorded, whether distributed or broadcast by so-called "free", "pay", "cable" television, video-on-demand over the Internet/cable/satellite, "home video" or otherwise and including, without limitation, television series, television motion pictures, MOWs and so-called "novels for television"), cassette, DVD's, video discs and other compact devices, sequel, remake and advertising rights (including 10,000-word synopsis publication rights); all rights to exploit, distribute and exhibit any motion picture or other production produced hereunder ("Picture") in all media now known or hereafter devised; all rights to make any and all changes to and adaptations of the Property; merchandising, sound track, music publishing and exploitation rights; the right to use Writer's name in and in connection with the exploitation of the rights granted hereunder; all live television, radio and legitimate stage rights; and all other rights customarily obtained in connection with formal literary purchase agreements (the "Rights").

7. ADDITIONAL DOCUMENTS: Writer agrees to execute at the Company's request any and all additional documents or instruments, including a short form option agreement and a short form assignment for purposes of recording in the Copyright Office, and to do any and all things necessary or desirable to effectuate the purposes of this Agreement. If such short form assignment is undated, the Company is authorized to date such short form assignment and to file the same in the Copyright Office immediately upon exercise of the option herein granted. If Writer fails to do anything necessary or desirable to effectuate the purposes of this Agreement, including, but not limited to, renewing copyrights and instituting and maintaining actions for infringement of any rights herein granted to dNa under copyright law or otherwise, Writer hereby irrevocably appoints the Company Writer's attorney-in-fact with the right, but not the obligation, to do any such things and renew copyrights and institute and maintain actions and all such things in Writer's name and behalf, but for the Company's benefit, which appointment shall be coupled with an interest and irrevocable.

(a) Writer is under no obligation to provide a Social Security Number by transmittal over the Internet in this Agreement, however he or she agrees to submit same to the Company by regular U.S. mail if and when requested.

8. RIGHT OF RIRST REFUSAL: If, pursuant to any copyright law or similar law Writer becomes entitled to exercise any right of reversion, recapture or termination (the "Termination Right") in or to all or part of the Rights granted hereunder, and Writer exercises the termination right, then, from and after the date that Writer has the right, pursuant to such copyright or similar law, to transfer all or part of such Rights (the "Recaptured Rights") to a third party, the Company shall have the first right to purchase and acquire from Writer the Recaptured Rights. If Writer is prepared to accept a bona fide offer with respect to all or part of the Recaptured Rights, then, in each such instance, Writer shall, promptly after deciding to accept such offer, make a written offer to dNa, specifying in such offer all of the terms and conditions which Writer is prepared to accept and the name of the third party who made the offer to Writer, to enter an agreement with dNa with respect to the Recaptured Rights on the same such terms and conditions. At any time not later than thirty (30) days after receipt of such written offer from Writer, the Company may notify Writer of its acceptance of such offer, and, in such event, the rights referred to in such offer shall be assigned to the Company, subject to the Company's compliance with the terms and conditions of the offer so accepted; provided, however, that dNa shall not be required to meet such terms or conditions which cannot be as easily met by one transferee as another, including, without limitation, the use of certain talent. If dNa shall acquire from Writer all or part of the Recaptured Rights, then Writer agrees to enter into appropriate written agreements with respect thereto. If the Company shall elect not to purchase the Recaptured Rights, then Writer may dispose of said rights, but only to the offeror and upon the terms and conditions specified in Writer's aforesaid notice to the Company, it being understood and agreed that Writer may not dispose of said rights to any other party or upon terms or conditions more favorable to the transferee than those offered to the Company hereunder without again offering such more favorable terms and conditions to dNa as herein provided.

9. CREDITS: The Company agrees to accord Writer credit in connection with any Picture based upon the Property, subject and pursuant to the provisions of the applicable Producers/Writers Guild Theatrical Basic Agreement.

a) Subject to the foregoing, the presentation of such credits shall be determined by dNa and dNa retains the right to have one screen credit on each Picture produced which is based upon the Property. Any casual or inadvertent failure by the Company, an assign, Purchaser, or any failure by any third party, to comply with the provisions of this paragraph shall not be deemed to be a breach of this Agreement.

b) In the event of a breach of the Company's obligations under this paragraph, it is expressly agreed that Writer's and dNa's sole remedy shall be to seek damages in a court of competent jurisdiction, and that in no event shall Writer or dNa be entitled to obtain any injunctive or other equitable relief or undertake any legal efforts to restrict dNa, or its assign's, right to exploit the Property.

10. BINDING ARBITRATION: Writer and the Company hereby agree to arbitrate any disputes in the County of Los Angeles, State of California in accordance with applicable provisions of the American Arbitration Association and judgement upon any reward rendered by the Arbitrator(s) may be entered in any court having competent jurisdiction and the prevailing party may recoup all its costs of litigation. Although, Writer and dNa agree to abide by any such arbitration decision(s) made, shall endeavor, with the best of their abilities, to settle all disputes that may arise without the need for arbitration.

11. CONFIDENTIALITY: In consideration of this Agreement and its benefits, Writer and its agents, employees and administrators, agree to keep confidential the specific terms and conditions of this Agreement, including but not limited to, the term of the Option and Exclusive Option Terms (including Extensions, renewals or conversions, thereof, if any), the Purchase Price, Screenplay Alternate Title, Writer Pseudonym and Sumbission ID. Writer hereby indemnifies dNa from any and all loss or liability that may result from a breach of the foregoing confidentiality.

12. TITLES AND TRANSFERS: dNa reserves the right to sell or transfer this Option Agreement at any time. In the event dNa sells this Option, it hereby agrees to grant Writer 20% of the gross proceeds from such sale and in return Writer hereby agrees to grant to dNa 20% of the Purchase Price received by Writer from the exercise of this Option Agreement, or modification hereof, by any person or entity other than the Company at any time.

a) Writer hereby agrees that he or she will assign a Screenplay Alternate Title and Writer Pseudonym below and that such have never been used before in any way in connection with this or any other screenplay or submission by Writer. SCREENPLAY ALTERNATE TITLE MUST BE DIFFERENT FROM SCREENPLAY WORKING TITLE; AND WRITER PSEUDONYM MUST BE DIFFERENT FROM WRITER LEGAL REALNAME. Further, Writer warrants that such Screenplay Alternate Title and Writer Pseudonym will be properly copyrighted and cross-indexed with Writer Legal Realname and the Screenplay Working Title which comprises the Property.

b) In the event Writer begins promoting the Property on his or her own, Writer agrees to abstain from using the Screenplay Alternate Title and Writer Pseudonyn, as set forth herein.

c) When dNa begins promoting the Property, it agrees to abstain from using the Screenplay Working Title and Writer Legal Realname, as set forth herein, reserving such for Writer's exclusive use. However, the Company reserves the right to inform any buyer, financier, successor, representative, heir, assign or licensee, but not limited to such, the Writer Legal Name and the Screenplay Working Title in order to effectuate a transaction contemplated herein.

13. RELEASE AND WAIVERS: Writer hereby acknowledges and warrants:

a) that he or she has read and meets all qualifications for submission set forth by the Company and agrees to submit a professionally-written Screenplay utilizing the proper formats, protocols and passwords, if any.

b) that he or she understands and acknowledges that the Company's use of other writer's literary properties may contain features and elements similar to or identical with those contained in the Property and as shall not entitle Writer to any compensation beyond that which is stipulated in the Option Agreement. Writer warrents that s/he has read the Submission Release, and such Release is subordinate to this Option Agreement in the event of any conflicts.

14. RISK ACKNOWLEDGEMENT: Writer understands that the nature of a "virtual movie studio" may require that Writer's Property be transmitted over the Web or Internet to various employees, independent contractors or (volunteer) Readers connected with the Company and Writer hereby authorizes such transmittal. The Company hereby assures Writer that it will use its best efforts to provide for the security of Writer's Property under password protection and Writer assures the Company that any passwords or actual literary properties of other writers that may come into his or her custody or awareness, if any, he or she will keep confidential.

a) If for any reason, or at any time Writer's Property is placed on the Readers' Shelf and Writer does not want it there, Writer may have it removed by sending such request in writing to the Company and same will be removed immediately. However, if Writer makes such request for removal, dNa retains the right to terminate this Agreement with Writer and shall be under no further obligation to Writer in any way.

b) Writer acknowledges that, although the Company is taking all security precautions it deems appropriate, no assurance can be given that such security cannot or will not be breached, and Writer agrees that by making this submission he or she will indemnify the Company hereby.

15. READER'S SHELF: Writer has retained a copy of said Property and releases dNa from any obligation to return same to Writer whether or not said Property is under option by the Company. The Company, however, reserves the right to keep Property on the Reader's Shelf for as long or short of a period as it deems necessary, unless it receives specific written request from the Writer to remove same from the Reader's Shelf. If however the Company or Writer elects to discontinue the Option dNa hereby agrees to destroy any and all physical or electronic copies of Writer's Property within a reasonable amount of time.

16. NOTICES: All checks and notices from the Company to Writer shall be sent to the below address and Writer agrees to notify the Company of any change of address within 10 days. All notices from Writer to the Company shall be sent to the Company at the following address: dNa DevelopMent, c/o Matrixx Entertainment Corporation, 223 W. Lancaster Ave, Devon, 19333-1587, or other such address as the Company shall designate.

a) Any and all notices or communication between the Company and Writer must contain the Submission ID as set forth hereinbelow.

17. SUBMISSION PROTOCOL: Writer agrees to set up the title page and format of the Screenplay as in the sample. Once the Screenplay is in proper format, copy and paste the entire Screenplay into the field provided below. If the Screenplay does not maintain proper format once pasted, it was not converted properly to a text file. Please go here for help in formatting.

18. HARD COPIES: For Writer's records, Writer agrees to print out at least one (1) copy of this Option Agreement (with all filled-in data visible in the fields) prior to clicking the below "Agreed and Accepted" button (Click here for a non-frames version if you had problems printing out this Agreement.), and;

a) If requested by the Company at any time, Writer hereby agrees to send, by REGULAR FIRST CLASS MAIL (unless otherwise specifically designated), a signed and fully executed copy of this Option Agreement, which Writer has printed out per 17a of above.

19. ACCURACY AND COUNTERPARTS: Writer represents and warrants that all data submitted herein is true and correct and that same is consistent with all previous documents, or forms, submitted to the Company. The Parties hereto agree that this Agreement may be executed in full counterpart or signature page counterpart as emailed between Writer and the Company.

20. SEVERABILITY: In the event any provision of this Option Agreement is held invalid or unenforceable by any arbitrator or court of competent jurisdiction, the remaining provisions will not be affected.

21. BINDING CONDITIONS: By clicking on the below "Agreed and Accepted" button, Writer hereby evidences and warrants that s/he has executed this Option Agreement but agrees that same will be binding on dNa ONLY after all of the following occur:

a) dNa actualy receives by email the fully filled-out and properly-executed Option Agreement as well as the properly-formatted text version of the Property (i.e., NOT an MS WORD document) and;

b) Writer is informed by return email that dNa has received and accepted the Option Agreement and Property and all is in order. In the event all is NOT in order (i.e., the Option has been improperly filled out and/or the Screenplay is in improper format, for instance), dNa may elect to i.) request/suggest corrections or; ii.) reject all of the above materials from Writer.

22. PRIOR AGREEMENTS AND CHOICE OF LAW: This Agreement, executed on the day and year below written ("Commencement Date"), supersedes and replaces any and all former Option Agreements or agreements (oral or written) whether expressed or implied between Writer and the Company relating to the subject matter hereof (except for the Submission Release). Unless and until a more formal agreement is executed incorporating all of the foregoing and additional detailed representations, warranties and other provisions customarily included in such formal literary purchase agreements, this Option Agreement shall be binding (when all submission conditions as setforth hereinbelow are met) and same shall be interpreted in accordance with California Law, and shall inure to the benefit of the Parties hereto as well as their successors, representatives, heirs, assigns and licensees.

AGREED AND ACCEPTED:

dNa DevelopMent
(a division of Matrixx Entertainment Corporation)

Writer Legal Realname
(required and must be different from Writer Pseudonym)

Writer Pseudonym
(required and must be different from Writer Legal Realname)

Screenplay Working Title
(required and must be different from Screenplay Alternate Title)

Screenplay Altenate Title
(required and must be different from Screenplay Working Title)

Social Security Number
(see 7a above)

Street Address: (no post office addresses)

Town or City/Zip/Country

Email (required)

Phone

Agent (if any)

Copyright Date of Property
(optional)

Option Term Commencement Date
(today's date)

Copy and Paste entire Screenplay into this Field:
IMPORTANT NOTE: If, after you have pasted your entire screenplay into the below field, it does not LOOK properly formatted (i.e., character titles centered, dialog centered and indented, description flush left, etc.) chances are that it is NOT properly formatted. We ask that you do NOT submit the screenplay until and unless it is properly formatted. Please go here for help.

Clicking this button will send both the
Option Agreement and the Screenplay to dNa DevelopMent

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Comments & Suggestions

If for any reason you feel uncomfortable executing or acquiring this Option Agreement, please let us know why. We won't necessarily act on your suggestion, but if a number of people have the same comment or suggestion, we WILL probably act on it. As mentioned above, we are piloting something new here and it is our sincere desire to make this a good experience for all involved. Unless you include your name and email, we will not be able to respond to your comment or suggestion, but we do thank you. We also accept any positive comments you may care to share. :)

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