Reggae: Past, Present and Future

Via Facsimile & U.S. Mail
Mr. Jeffrey G. Knowles
Coblentz, Patch, Duffy, & Bass LLP
One Ferry Building, Suite 200
San Francisco, California 94111-4213

Re: Mateel Community Center, Inc. v. People Productions, LLC et. al.

Dear Mr. Knowles,

I am writing in response to your letter to Bill Bragg of May 8, 2007, regarding the offer from Mr. Dimmick for a partial resolution of the ongoing dispute between our clients. Bill is out of town this weekend and asked that I forward this response to you.

This correspondence is pursuant to settlement discussions and is inadmissable under Evidence Code section 1152.

The offer is acceptable to the Mateel with the following revisions.

Item 1: The $200,000.00 payment shall be based upon the attendance level set by the planning commission at its last meeting. The payment will be increased by $20.00 per person increase in attendance level that may be approved by the Planning Commission for the 2007 event. Miscellaneous equipment needed for Summer Arts Faire will be returned to the Mateel upon execution of this agreement. Mateel will provide a list of the items prior to execution of the agreement.

Item 2: Acceptable without revision.

Item 3: The 2007 event shall be produced under the name “Reggae on the River.” No other name or trademark shall be associated with its production. In particular, “Reggae Rising” will not be associated with this event.

Item 4: Acceptable, however it needs to be clarified that the present action does not constitute an impediment to Mr. Dimmick’s promotion efforts. Suggested language: “Mateel will refrain from initiating any new legal proceedings that would impede Mr. Dimmick’s festival.”

Item 5: Acceptable without revision.

Item 6: Acceptable, but in addition your client will not assert any claims against Boots Hughston or 2B1 Productions and will indemnify them from any claims made by People Productions, relating to the 2007 event.

Item 7: The only matters relative to the litigation that will be stayed is the scheduling of the hearing before the referee which will not be scheduled to occur within 45 days after the conclusion of the 2007 event but, in no event, shall be scheduled later than 90 days after the 2007 event.

Item 8: Mateel will agree to pay the outstanding billing from the Mendocino County Sheriff’s Department upon verification that there has not been double payment. Agreement to pay any other outstanding debts depends upon their specific identification with supporting documentation concerning the circumstances under which they were incurred.

It is understood that Mr. Dimmick requires the signed version of the 2B1 production agreement to be provided along with certification from the ticket agency of the amount of tickets sold and the amount in the advanced ticket sales account.

The Mateel would also like to put forth the following proposals for a global

settlement of the dispute between all of the parties. The main terms of the offer are as follows:

Multi-year/Global Settlement

• The Mateel will receive $240,000.00 per year for nine years (eight years if a separate one year agreement for 2007 is reached) or $20.00 per head using capacities set by Planning Commission or actual attendance, whichever is less, as long as actual attendance is independently verified by a means acceptable to Mateel. The $33,333.00 paid to Mr. Dimmick as an advance on rent for the 2007 festival year shall be refunded.

• Mateel shall be paid the appraised value of infrastructure and equipment divided into nine equal annual installments (eight if a 2007 agreement is reached), no interest. A credit toward infrastructure to be negotiated shall be applied in the event of a separate 2007 agreement. Miscellaneous equipment needed for Summer Arts Faire will be returned to the Mateel upon execution of this agreement. Mateel will provide a list of the items prior to execution of the agreement.

• Reggae on the River archives including graphics, old artwork, etc. shall be returned to the Mateel.

• People Productions shall agree to provide any and all financial documents that are presently not in the Mateel’s possession that the Mateel may be required to produce at the request of any governmental agency for the 2005 and 2006 events. People Productions shall hold Mateel harmless and indemnify Mateel from any adverse financial consequences that may result from the failure to produce those documents including any back taxes or penalties that may be assessed.

• The Mateel shall be provided a promissory note to secure the appraised value of the infrastructure and equipment secured by a first deed of trust on the property on which the infrastructure is located. If a first deed of trust is not possible for that property, another property of equal or greater value may be used to secure the note.

• Payment of the other amounts owed pursuant to the agreement will be secured by personal guarantees of Mr. Dimmick supported by his financial statement evidencing sufficient financial strength to meet the guarantee. In the event he has insufficient financial strength to support his guarantee he will provide additional co-signers that do.

• All litigation, including the complaint filed by People Productions, is terminated with mutual releases.

Alternate Long-Term Settlement

The Mateel is paid $200,000.00 per year for nine years (eight years if there is a separate agreement for 2007) for a release/assignment of rights under the existing lease, all rights under the existing permit, all claims for infrastructure and equipment.

All other terms of the previous offer concerning archives, financial record guarantees, security for payment and resolution of litigation.

Mateel retains the Reggae on the River trademark.

Please be aware that an agreement for at least the short-term solution must be reached by this coming Monday, or the transfer of Reggae on the River tickets and proceeds will no longer be possible. I look forward to hearing from you. You can reach me this weekend at my home phone number or by e-mail at

Very truly yours

May 14, 2007

Email letter received from Mr. Dimmick’s Attorney.

Dear Jim:

I write in response to your email yesterday, attaching a letter dated May 12, 2007.

Mr. Dimmick believes that pursuit of partial resolution is the best course at the point in the process, given the time constraints set forth in your letter and the likely difficulty of resolving some of the parties' differences in connection with a global settlement. Mr. Dimmick is prepared to enter into an agreement to resolve the dispute in part along the lines set forth in my letter of May 8, 2007, with modifications as follows:

Item 1: Payment. Mr. Dimmick will pay to Mateel Community Center, Inc. ("MCC") the sum of $200,000, plus $20.00 per person to the extent the attendance limit is raised from it's current level, with all amounts in excess of $200,000 allocated to a purchase of any interest MCC may have in infrastructure on the Dimmick property or, in the event it should be determined by Mr. Dimmick or by binding third-party decision that Mr. Dimmick owes any other monetary obligation to MCC, toward any such obligation. The choice of how to allocate as between the infrastructure interest or other obligation shall be Mr. Dimmick's. Depending on the equipment MCC seeks for its Summer Arts Fair, Mr. Dimmick may agree to this term as provided in your letter.

Item 2: Rescission of 2B1/MCC agreement: Agreed

Item 3: License/Use of name. Mr. Dimmick cannot agree to refrain from using the name "Reggae Rising" in connection with the event. At this point, there is so much confusion in the market place, Mr. Dimmmick cannot reasonably expect to sell out the event without using that name, especially given the increasing public reports that "Reggae on the River" may not occur regardless of the outcome of the legal dispute. He will, however, agree to place the "Reggae Rising" name in more a of supporting position, such as using the phrase "Reggae Rising presents Reggae on the River."

Item 4. Non-interference. Mr. Dimmick agrees that the pendency of litigation alone shall not be considered an impediment under this term, but believes, as explained below, that the term should make clear that no steps will taken in the litigation at all, except as required by a court or to effectuate a stay, until after the 2007 festival takes place.

Item 5: Transfer of ticket proceeds/control: Agreed, but it should be clear that this includes a transfer of proceeds relating to camping and a list of vendors detailing the status of those arrangements. Mr. Dimmick would not be obligated to vendors, but would consider them on a case-by-case basis.

Item 6: Indemnity/Covenant Not To Sue: The original rationale for requesting indemnity against claims by 2B1 was to protect against a circumstance in which 2B1 objected to the rescission of the agreement with MCC and the license to Mr. Dimmick. Mr. Bragg, however, has indicated that 2B1 will agree to the rescission/license to Mr. Dimmick. We suggest that he sign off on this agreement, and that no one will provide ang indemnity or other commitment regarding refraining from making claims. I doubt we have time to negotiation anything more complicated and, as written, the modifications suggested in your letter are problematic.

Item 7: Litigation Stay: All litigation must be stayed until after the festival. The reason for this is that discovery proceedings are likely to create a significant impediment to the extremely time consuming process of preparing for the festival. Additionally, there is no logical reason why only the summary judgment motion hearing should be deferred. If an overall stay is agreed upon, a deferral of proceeding until 45 days after the festival is acceptable.

Item 8: Payment of 2006 Obligations: It sounds like we do not have a disagreement in principle on this point. From Mr. Dimmick's point of view, he simply does not want outstanding obligations to government agencies or vendors to pose an impediment to the 2007 festival.

Receipt of a copy of the final, signed version of the MCC/2B1 agreement and a certified box office statement regarding ticket sales to the "Reggae on the River" event for 2007, and subsequent approval of the terms above by Mr. Dimmick, are preconditions to any deal. It is therefore urgent that MCC/2B1 provide that information immediately if we are to conclude even a tentative deal by tomorrow.

Please inform your client not to respond to these proposed deal terms with a "counterproposal." Not only is there inadequate time to continue these negotiations, but Mr. Dimmick cannot offer any increased sum, given existing financial constraints and uncertainties, nor can he afford to refrain from using the "Reggae Rising" name. The other terms, too, are all more than reasonable.

I will attempt to contact you later today or early tomorrow to discuss.

May 15, 2007

Jeffrey Knowles
Coblentz, Patch, Duffy & Bass LLP
One Ferry Building, Suite 200
San Francisco, CA 94111

Re: Mateel Community Center v. People Productions, et al.

Dear Mr. Knowles:

Consistent with my phone message of yesterday afternoon and our phone conversation of yesterday evening, this correspondence will confirm the Board’s response to your client’s last proposal.

Your client claims that there is “confusion” among the ticket buying public arising from his unilateral promotion of a “Reggae Rising” event planned for the same weekend and same location as Reggae on the River such that he is worried about the ability to fully sell tickets for all authorized attendance.

My clients have no doubt that your client and his backers have the ability to remove this “confusion” by clearly removing their competing “Reggae Rising” references from the market place. Reggae on the River has been in place for over 23 years and is well recognized by the ticket buying public. The event has sold out for a number of years.

My clients are not interested in assisting in the promotion of a competing event and will not agree to the use of any competing trademark and in particular, the “Reggae Rising” label in the promotion of the event. The Mateel is, however, willing to address your client’s fears. They will provide a $20.00 credit toward any sums owed by your client to the Mateel including infrastructure when those sums are finally determined for the amount of tickets left unsold for the 2007 event.

As I indicated to you in my messages and conversation yesterday, the ability to transfer advanced ticket sales as part of this offer will expire at 9:00 a.m. this morning. After that time, 2b1 must maintain good faith with those who purchased tickets to the 2007 Reggae on the River and will begin refunding ticket sales.

Since you have advised that any arrangement for the 2007 event would necessarily require the inclusion of a transfer of those advanced tickets, I will assume that there will be no resolution for this year and the Mateel will be forced to announce the cancellation of the 2007 music festival at that time.

Very truly yours,

WILLIAM R. BRAGG

WRB:pl