SHARK TANK

Producer’s Business Interest - Structure

Royalty Scenario
Producers (Jointly Sony, Burnett, ABC) currently receive a royalty structured as a percentage
of “Net Revenues” defined as:
 Net Revenues” shall be defined as all revenues, from whatever source, generated by
or derived from the Business that I present to the Sharks as part of the Series,
whether received by or credited on a non-refundable basis to me, my Team
members, any Holding Entity, or my or Holding Entity’s designee, assignee or
successor, less only actual, verifiable, out-of-pocket third-party costs and expenses
for bona fide goods or services directly related to the Business (collectively
“Deductible Costs”). In no event shall Deductible Costs exceed the applicable market
rates or include any imputed costs or charges

Equity Scenario
As an alternative, we are considering structuring an option for Producers to receive an equity
stake via warrants for preferred equity equal to 7.5% of the stock of the company
 Each producer (Sony, Burnett, ABC) will have a period of 24 months to accept or reject
issuance of their warrants (2.5% per producer)
 Warrants will equal 7.5% of fully diluted shares at time of exercise 
 MFN against VC and founders on equity terms (e.g., dilution protection, audit rights, P&L
reporting, registration rights, matching rights, preemptive rights, tag-along/drag-along,
approval/consent rights)
 Warrant strike price will be $0.01
 Once warrants are accepted by Producers, they are exercisable at any time, including
upon a change of control. Producers to have cashless exercise option
 No term on the warrants
 Equity will be non-funding
        No transfer restrictions on warrants or equity issued on exercise of warrants
        No term on warrants
        Preferred equity to be the senior-most class of shares in regard to dividend, liquidation
preferences, and voting