Donald C. Farber - From Option to Opening: A Guide to Producing Plays Off-Broadway

SAM BARON
123 Waverly Place
New York, NY 12345
February 1, 2005

Bob Brown
123 4th Street
Brooklyn, NY 12345

Dear Bob:

1. I have organized Gofer LLC, a Limited Liability Company (the Company) under the Laws of the State of New York to produce and present Off-Broadway in New York City a play entitled Gofer It! The Investor Members of the Company will share pro-rata in fifty percent (50%) of the Net Profits of the Company, and I as the Managing Member will receive fifty percent (50%) of such Net Profits.

2. You have advanced me the sum of $5,000 that will constitute front money. I shall have the right to use these funds immediately, but only in connection with the Play, for the following pre-production purposes: fees; advances; deposits or bonds made for the purpose of purchasing options on the play; engaging creative personnel; securing a theatre; retaining legal, accounting and other professional advisors; preparing offering documents; the costs of a workshop to be presented by me; or other purposes reasonably related to the business of the theatrical production company for which the front money was raised.

3. In consideration of the foregoing, when the Play is fully financed, you will be designated as an Investor Member thereof to the extent of the amount of front money so advanced by you, and you shall be entitled to such portion of the Investor Members share of the Net Profits of the Company as your investment bears to the Total Capital raised for the production of the Play. In addition, you shall be entitled to the same percentage of the Net Profits of the Limited Liability Company to be formed, payable from the Managing Members share of such Net Profits when and if received by me as Managing Member, and subject to all rights of refund, rebate, and return as are applicable to the Managing Members share under the Limited Liability Company Operating Agreement.

4. You understand that the front money advanced by you is high-risk capital, and if the Play is abandoned, at any stage, for any reason whatsoever, my only obligation will be to account to you for the funds spent and to return to you, and the other parties advancing front money, any unused balance of such funds, pro-rata and pari passu. At your request, I will furnish you with an accounting for all front money advanced to me, but not more than once every six months, and then only until such money has been fully expended or the Play abandoned and the provisions of this Paragraph 4 fully satisfied.

5. You hereby irrevocably authorize, nominate, and appoint me as your attorney-in-fact to effectuate your investment in the Company in accordance with the foregoing.

6. Your liability with respect to the Play shall be limited to the amount of front money advanced by you. I agree to indemnify you against any and all claims, liabilities, or expenses, including reasonable attorneys fees, arising out of any claim by third parties asserting that you are liable for any sum beyond such amount.

7. I will hold one (1) pair of adjoining house seats for you or your designee, for each and every performance of the Play. Such house seats shall be held until forty-eight (48) hours prior to the scheduled performance and shall be paid for at the regularly established box-office prices.

You acknowledge and agree that the theatre tickets made available hereunder cannot, except in accordance with the regulations promulgated by the Office of the Attorney General of the State of New York, be resold at premium or otherwise, and that complete and accurate records will be maintained by you, which may be inspected at reasonable times by a duly designated representative of the Producer and/or the Attorney General of the State of New York with respect to the disposition of tickets made available hereunder.

8. This letter, when countersigned by you, shall constitute a binding Agreement between us that shall be construed in accordance with the Laws of the State of New York. Our Agreement hereunder may not be modified orally.

9. Any dispute or controversy arising under, out of, or in connection with this Agreement or the making or validity thereof, its interpretation, or any breach thereof shall be determined and settled by arbitration by one arbitrator who shall be selected by mutual agreement of the parties hereto, in New York City, pursuant to the Rules of the American Arbitration Association. The arbitrator may award to the prevailing party reasonable attorneys fees, costs, and disbursements, including reimbursement for the cost of witnesses, travel, and subsistence during the arbitration hearings. Any award rendered shall be final and conclusive upon the parties, and a judgment thereon may be entered by the appropriate court of the forum having jurisdiction.