Subject: Re: Project Snowflake
From: "Eric Schwerin" <[email-masked]>
To: <[email-masked]>
Cc: "Hunter Biden" <[email-masked]>
Date: Sat, 21 Aug 2010 08:25:43 +0200

If we can wait until COB Tuesday that would be best.  Looks pretty much there but it raises a couple of issues related to our original RSP agreement that Devon, Hunter and I should discuss before sending to Vide and I don't think we'll have that opportunity until Tuesday.  Nothing overly problematic but with us having been out of the office so long I'd rather wait until we get back in the country. 

Does that work?

Eric D. Schwerin
[email-masked]

Sent from my iPhone

On Aug 21, 2010, at 3:45 AM, "Neil Callahan" <[email-masked]> wrote:

> Hi guys,
> 
>  
> 
> Here is the content of the RSA Term Sheet.
> 
>  
> 
> This has not been sent to the “Vide” folks yet.  We would like a first look from our team and then send on.
> 
>  
> 
> Ideally we can send this out on Monday evening, as I will be with Curt and potentially Michael on Tuesday.
> 
>  
> 
> Contained within the Term Sheet is explicit minimal commitment from key executives.  The knife cuts both ways, so we need to be clear on what we want from them in return what they reasonably can expect from us.
> 
>  
> 
> If you cannot review and have feedback on by Monday PM EST, let me know and we can get it done 1st thing on Tuesday when I get in.
> 
>  
> 
> Hope you have killed a lot of stuff and can bring me back a saber tooth or two.
> 
>  
> 
> Best,
> 
>  
> 
> Neil
> 
>  
> 
>  
> 
>  
> 
> SUMMARY OF TERMS
> 
>  
> 
> ROSEMONT SENECA ANALYTICS, LLC
> 
>  
> 
> This confidential summary of transaction terms (the “Term Sheet”) summarizes the principal terms of a proposed transaction between Rosemont Seneca Partners, LLC (“RSP”) and Vide for the formation and launch of Rosemont Seneca Analytics, LLC (the “Company”).  This Term Sheet is intended to provide certain binding terms for inclusion in definitive documentation of the transaction outlined herein.  This Term Sheet does not constitute either an offer to sell or an offer to purchase securities.  This Term Sheet is directed exclusively to RSP and Vide.
> 
>  
> 
> Parties
> 
> Rosemont Seneca Partners, LLC, a Delaware limited liability company (“RSP”).
> 
> Vide Corporation, a corporation organized under the laws of the State of Delaware.
> 
> Proposed Transaction
> 
> RSP and Vide shall, according to the terms and conditions outlined herein, undertake the formation and commencement of commercial operations of Rosemont Seneca Analytics, LLC (“RSA” or the “Company”).
> 
> RSA shall create and offer analytical research products and services based on intellectual property and proprietary processes (the “Vide Technology”) created by Vide, its founders, officers/directors and employees.
> 
> Company Ownership
> 
> Upon its formation the equity interests in the Company shall be held equally by RSP (or its assign) and Vide (or its assign).  The equity interests shall be issued in exchange for the consideration provided by each of the parties as set forth below.  Following formation, the Company’s capitalization may be adjusted upon the occurrence of certain events as provided for herein or in the Company’s Operating Agreement.
> 
> Issuance and transfer of equity interests in the Company shall be restricted by the terms and conditions of the Company’s Operating Agreement.
> 
> Contribution of Parties
> 
> The Parties shall contribute the following consideration in exchange for the issuance of equity in the Company:
> 
> RSP Contribution:  RSP shall be responsible for development of the Company’s business plan, which shall include processes for commercialization the Vide Technology as well as marketing and implementation of the Company’s product offering.  Specific RSP contributions shall include:
> 
> 1.      A cash investment in RSA of up to Five Hundred Thousand Dollars ($500,000.00);
> 
> 2.      Office space within RSP’s current New York, New York and Washington, DC office facilities;
> 
> 3.      Commencing with the execution of this Term Sheet, commitment of time by RSP senior management staff (as a percentage of hours dedicated to work):
> 
> Neil Callahan                     100%
> 
> Devon Archer                    50%
> 
> Chris Heinz                        50%
> 
> R Hunter Biden                  25%
> 
>  
> 
> 4.      RSP intellectual property (business processes, etc).
> 
> Vide Contribution:  Vide shall be responsible for providing the Vide Technology and supporting the implementation thereof (including but not limited to software usage, data usage, technology infrastructure, documentation history, general access and know how to develop marketing materials, support sales efforts).  Specific Vide contributions shall include:
> 
> 1.      A cash investment in RSA of up to Fifty  Thousand Dollars ($50,000.00);
> 
> 2.      Commencing with the execution of this Term Sheet, commitment of time by RSP senior management staff (as a percentage of hours dedicated to work):
> 
> Kurt Hastings                   50%
> 
> Michael P. Andrews        50% 
> 
> Ronnie Mainieri               25%
> 
> Thad A. Brown                25%
> 
>  
> 
> 3.      Vide Technology pursuant to a license agreement as described below.
> 
> Vide License Agreement
> 
> Vide shall issue to the Company a perpetual, worldwide, exclusive, royalty-free license for the commercialization of Vide Technology to non-US federal government customers (the “License Agreement”).  Vide shall retain the exclusive rights to provide the Vide Technology to the US federal government.
> 
> Company Inventions
> 
> The Parties agree that all inventions that are discovered, developed, created, conceived,   reduced to practice, and/or made by the Company utilizing the Vide Technology under the License Agreement shall be irrevocably assigned to the Company.  The Parties further agree that all personnel in the employ of the Company (including but not limited to consultants) shall execute Proprietary Information & Inventions Agreements.
> 
> Expenses
> 
> The parties hereto will be responsible for and bear all of their respective costs and expenses incurred at any time in connection with the execution of this Term Sheet.
> 
> Company Management
> 
> The Parties hereby agree that the Company shall be managed by a Board of Directors (who shall also serve as Managing Members) that shall be comprised of the following persons:
> 
> R. Hunter Biden
> 
> Thad A. Brown, Ph.D
> 
> Christopher D. Heinz
> 
>  
> 
> The Board of Directors shall designate officers and other management staff as needed.
> 
>  
> 
> Operating Agreement
> 
> The Parties agree that the Operating Agreement shall contain the following key terms (the specifics of which are anticipated to be fully reciprocal and shall be determined by the Parties in good faith):
> 
> ·         Buy / Sell / Transfer Restrictions & Rights, including Right(s) of First Refusal/Right(s) of First Offer, Drag Along/Tag Along Rights
> 
> Key Man Insurance policies and provisions
> ·         Terms and conditions for third-party equity or debt offerings
> 
> ·         Enterprise valuation procedures
> 
> ·         Board of Directors Observation Committee:
> 
> Devon Archer
> 
> Neil Callahan
> 
> Eric Schwerin
> 
> Michael P. Andrews  
> 
> Ronnie Mainieri               
> 
> Marc X. LoPresti
> 
> Kurt Hastings
> 
> ·         Exit Strategy evaluation and procedures
> 
> ·         Indemnification provision
> 
>  
> 
> Certain Securities Law Considerations
> 
> The interests in the Company (and/or its affiliates) will be issued without registration under the United States Securities Act of 1933 Act (the “1933 Act”) by reason of the exemption from the registration requirements set forth in Section 4(2) of the 1933 Act and Regulation D promulgated under the 1933 Act.  The interests are “restricted securities” under the 1933 Act, and as such the interests cannot be resold in the United States except as permitted under the 1933 Act, pursuant to   registration thereunder or exemption therefrom.
>  
> 
> Confidentiality
> 
> The parties hereto agree that the transactions outlined herein shall be kept confidential, including but not limited to the fact that discussions regarding the transactions are occurring, and shall be disclosed only to each party’s advisors, officers and directors.
> 
> Miscellaneous
> 
> Any changes, modifications, revisions or amendments to this Term Sheet which are mutually agreed upon by the Parties shall be incorporated by written instrument.
> 
>  
> 
> The construction, interpretation and enforcement of this Term Sheet shall be governed by the   laws of the State of New York.
> 
>  
> 
> This Term Sheet represents the   entire and integrated agreement between the parties and supersedes all prior negotiations, representations and agreements, whether written or oral.
> 
>  
> 
> Should any portion of this Term   Sheet be judicially determined to be illegal or unenforceable, the remainder of the Term Sheet shall continue in full force and effect.
> 
>  
> 
> The parties do not intend to create in any other individual or entity the status of a third party beneficiary, and this Term Sheet shall not be construed so as to create such status. 
> 
>  
> 
> This Term Sheet may be executed in any number of counterparts, each of which when executed and delivered shall be deemed to be an original, and all of which when taken together shall constitute one and the same Term Sheet.
> 
> IN WITNESS WHEREOF, the Parties have hereunto set their hand and seal duly executing and agreeing to this Term Sheet on the date first written above.
> 
>  
> 
> For:  ROSEMONT SENECA PARTNERS, LLC
> 
>  
> 
>  
> 
>  
> 
> By:      ___________________________________              
> 
> Name:  R. Hunter Biden                                
> 
> Title:    Managing Member & Co-Chairman
> 
>  
> 
>  
> 
> For:  VIDE CORPORTAION
> 
>  
> 
>  
> 
>  
> 
> By:      __________________________________
> 
> Name:  Thad A. Brown, Ph.D
> 
> Title:    Managing Director
> 
>  
> 
>  
> 
>  
> 
> ------------------------------------------------------------------------------------------
> 
> Neil Callahan
> 
> Rosemont Seneca
> 
> 401 Greenwich Street, Suite 400 | New York NY 10013 | 212-933-9965 | 212-796-4037
> 
> 1010 Wisconsin Avenue, Suite 705 | Washington DC 20007 | 202-333-1880
> 
> 917-945-9516 (mobile)
> 
> 866-749-8879  (fax)
> 
>  
> 
> From: Eric Schwerin [mailto:[email-masked]] 
> Sent: Friday, August 20, 2010 7:34 PM
> To: <[email-masked]>
> Subject: Re: Project Snowflake
> 
>  
> 
> Neil-  
> 
>  
> 
> Can't pull this up from South Africa so if Hunter and I can give you comments when we get back on Tuesday that'd be better if it works for the timeline. 
> 
>  
> 
> Has it gone to the IPS folks yet or will we have the ability to review before they see it? 
> 
>  
> 
> Been thinking a lot about how much time we each want to dedicate to the entity and want to make sure that is incorporated into the term sheet so there are reasonable expectations on both sides. Want to make sure we don't overcommit. 
> 
>  
> 
> Thanks, 
> 
>  
> 
> Eric
> 
> Eric D. Schwerin
> 
> [email-masked]
> 
>  
> 
> Sent from my iPhone
> 
> 
> On Aug 20, 2010, at 10:14 PM, "Neil Callahan" <[email-masked]> wrote:
> 
> Hi guys,
> 
>  
> 
> Attached is the Snowflake Term Sheet draft.  Please take a look and review.  If you can have comments back to me on Monday afternoon, I can review and see if we need a call to discuss.
> 
>  
> 
> One item on Vide, as it stands now Vide does not legally exist.  Thad and Marc spoke today about the existence of the Center for Social Computation of Northern Virginia.  Thad is working with his legal council on the formation of a commercial entity that has the appropriate rights to the assets and capabilities that we need for Rosemont Seneca Analytics.  Marc and I will work with Thad next week to sheppard this process along.  Thad was very open to our input to ensure we put all the right things into that organization/structure that we need.
> 
>  
> 
> We will need this entity in place in order to execute on the term sheet, so we will figure out that timeline next week and work the finalization of the term sheet in parallel.
> 
>  
> 
> Devon and I will review budget in detail on Monday and I will be in DC on Tuesday and Wednesday with Curt and Rob to finalize our Steering Committee prep package in support of our 8/31 call/meeting.
> 
>  
> 
> Have a great weekend.
> 
>  
> 
> Best,
> 
>  
> 
> Neil
> 
>  
> 
>  
> 
>  
> 
> ------------------------------------------------------------------------------------------
> 
> Neil Callahan
> 
> Rosemont Seneca
> 
> 401 Greenwich Street, Suite 400 | New York NY 10013 | 212-933-9965 | 212-796-4037
> 
> 1010 Wisconsin Avenue, Suite 705 | Washington DC 20007 | 202-333-1880
> 
> 917-945-9516 (mobile)
> 
> 866-749-8879  (fax)
> 
>  
> 
> From: Marc X. LoPresti [mailto:[email-masked]] 
> Sent: Friday, August 20, 2010 3:56 PM
> To: 'Neil Callahan'
> Cc: 'Devon Archer'; 'Joe Tagliaferro'
> Subject: Project Snowflake
> 
>  
> 
> Neil:
> 
>  
> 
> See attached as per our discussions today.
> 
>  
> 
> Best,
> 
> Marc X. LoPresti, Esq.
> Tagliaferro & LoPresti, LLP
> 
> New York Office:
> 45 Broadway, Suite 2200
> New York, New York 10006
> (212) 732-4029
> (212) 232-2398 (fax)
> 
> Los Angeles Office:
> 12400 Wilshire Boulevard, Suite 820
> Los Angeles, California 90025
> (310) 312-1860
> (310) 445-1866
> 
> CONFIDENTIALITY NOTICE:
> 
> The information contained in this electronic mail message is private and confidential and may contain Attorney-Client privileged information. It is intended only for the use of the individual or entity to whom it is addressed. The information may be privileged, proprietary and exempt from disclosure under applicable federal, state or other law. Any recipient of this electronic mail message other than the intended recipient is hereby notified not to disclose, distribute or copy this electronic mail message, or take or refrain from taking any action in response to this message.
> 
> <Term.Sheet.RSA(8.20.10).doc