LICENSE AND PURCHASE OPTION AGREEMENT
THIS LICENSE AND PURCHASE OPTION AGREEMENT (this "Agreement") is entered
into this 30th day of May, 2006, by and among ELITE FLIGHT SOLUTIONS, INC., a
Delaware corporation ("Elite Flight" or "Parent"), DREAMHOME SOLUTIONS, INC.
("Licensee"), a Nevada corporation and wholly-owned subsidiary of Parent,
DreamHoldings, LLC ("DreamHoldings"), a Virginia corporation, and DREAMHOME
REMODELING, INC. ("Licensor" or "DreamHome") a Virginia corporation and
wholly-owned subsidiary of DreamHoldings, and together with DreamHoldings,
Licensee and the Parent, the "Parties").
RECITALS:
WHEREAS, DreamHome is in the home remodeling business with custom sales
and marketing tools, software and business practices with operations in the
Baltimore and Washington D.C. metropolitan areas (together, the "Business
Territory" which is detailed on Exhibit A);
WHEREAS, Elite Flight desires to enter into the home remodeling sales
business and to open and develop up to eight (8) and not less than four (4)
DreamHome offices in new markets outside of the Business Territory (each, an
"Office") through its wholly-owned subsidiary, Licensee;
WHEREAS, DreamHome desires to license to Licensee, and Licensee desires to
accept from DreamHome, certain custom business practices and services of
DreamHome for the purpose of developing new Offices on terms not inconsistent
with the terms in that certain letter of intent, dated as of March 9, 2006 (the
"Letter of Intent"), by and between DreamHome and Elite Flight.
NOW, THEREFORE, in consideration of the promises and of the mutual
covenants contained herein and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Parties hereto
hereby agree as follows:
AGREEMENT:
1. Recitals. The foregoing recitals are true and correct and are
incorporated herein by this reference.
2. Grant of Products License; Services; Warranty.
(a) Licensor hereby grants to Licensee, and Licensee hereby accepts
from Licensor, a non-exclusive license (the "Product License") to use certain
custom tools, materials and business practices of DreamHome (collectively, the
"Products") subject to the terms of this Section 2(a). The Parties further agree
that DreamHome shall not grant such a license to any other person or entity in
any area where Licensee is then conducting business. In addition, Licensee shall
have a right of first refusal to operate in any potential market until such time
that Licensee has opened all eight (8) offices.
(b) Licensor hereby agrees to provide certain services to Licensee
in connection with the Products ("Services") for the Term (as defined herein
below) in any and all markets outside of the Business Territory (as defined
herein above) for the purpose of developing and managing up to eight (8) and not
less than four (4) new Offices of DreamHome subject to the terms of this
Agreement. A list of the Products and Services is set forth in Sections 2(d)-(e)
herein below.
(c) Subject to Section 5 herein, Licensee has the right to retain
all net cash flow from any and all home remodeling sales earned in connection
with the operation of the Offices consistent with the existing operations of
DreamHome.
(d) As used herein, the "Products" include:
(i) All existing and future DreamHome tools and materials
required to support the Licensee in the hiring, training, and implementation of
all necessary personnel, policies, and procedures required to establish, develop
and maintain each Office consistent with the existing operations of DreamHome;
(ii) all existing and future DreamHome sales and marketing
materials; and
(iii) copies of all existing and future DreamHome compensation
plans, employee manuals, sales contracts and or other related documents,
including, without limitation, those documents used by Licensor for hiring,
training, employee incentives and bonuses. Upon the express approval by
Licensee, all such materials shall be put into place to establish and maintain
each Office.
(e) As used herein, "Services" include:
(i) not less than six (6) consecutive days of training by a
qualified employee of Licensor, as determined by Licensor, at or near Licensor's
Washington D.C. office for new Initial Office employees (as such term is defined
herein below); such training shall consist of eight (8) hours per day between
the hours of 10:00 a.m. and ending at 6:00 p.m.;
(ii) not less than five (5) days of training ("Training"),
within a two (2) week period, by a qualified employee of Licensor, as determined
by Licensor, at each Office location of all Office personnel at such location to
ensure that each Office is appropriately set up and prepared to operate
consistent with the existing operations of DreamHome; Licensee shall be
responsible for all costs and expenses incurred by Licensor's employee
associated with such Training including, but not limited to, travel, hotel, and
meal expenses;
(iii) Licensor's daily (Monday through Saturday from 10:00
a.m. through 6:00 p.m.) supervision and management of each Office consistent
with the existing operations of DreamHome to best ensure maximum lead
generation, sales and installations consistent with the existing operations of
DreamHome;
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(iv) Licensor's guidance regarding how Licensee can best
create new relationships in all new markets as needed to establish and maintain
each new Office consistent with the existing operations of DreamHome;
(v) DreamHome shall make a good-faith effort to assist
Licensee with the licensing and implementation, at Licensee's sole cost and
expense, of the Tracker Software (as is more fully described on Schedule 2(e)(v)
attached hereto) at each Office to monitor and account for all leads, sales,
financing and installations consistent with the existing operations of
DreamHome; and
(vi) any additional future services provided by DreamHome at
each Office location as mutually determined by the Parties.
(f) Warranty. With the exception of the Tracker Software, Licensee
warrants to Licensee and Parent that all Services to be provided by Licensor to
Licensee under this Agreement will be consistent with the existing operations of
DreamHome.
3. Purchase Option.
(a) The Licensor hereby grants to Licensee, and Licensee hereby
accepts from Licensor, a right of first refusal option to acquire the business
of Licensor (the "Option"). The Option will commence on the Effective Date (as
defined herein below) and expire on the twenty-four (24) month anniversary of
the Effective Date. If Licensor receives an offer (an "Offer") to purchase the
business of DreamHome from a third party (a "Third Party") that is acceptable to
DreamHome (in the sole discretion of DreamHome), it shall present such Offer to
Licensee within ten (10) business days of DreamHome's receipt of such Offer.
Upon receipt by Licensee of such Offer from Licensor, Licensee shall have thirty
(30) days to match such Offer (the "Matching Period"). If Licensee fails to
match the Offer within the Matching Period, the Option will expire unless
otherwise agreed to by Licensee and DreamHome in writing. In the event an Option
expires in accordance with the terms of this Section 3(a) and a definitive
purchase agreement is not consummated by and between Licensor and a Third Party,
the Option shall be reinstated with respect to any and all future Offers and
Licensee shall have the same Option rights granted herein as if the original
Option had not expired.
(b) If the Licensee matches any Offer to acquire the business of
Licensor within the Matching Period, this Agreement shall terminate in
accordance with Section 8(d) herein at the sole option of Licensee.
(c) In the event that Licensor offers for sale to a third party the
business of DreamHome or receives an Offer from a third party to purchase the
business of DreamHome during the Term, the Parties agree that any such
acquisition of DreamHome by a Third Party will be considered an assignment under
Section 15(a) of this Agreement and therefore, Licensor shall be required to
obtain the express consent of Licensee in accordance with Section 15(a).
Furthermore, in the event that a Third Party acquires the business of Licensor,
the Parties acknowledge and agree that this Agreement shall be binding upon any
such Third Party as if such Third Party were an original party hereto.
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4. Licensing Fees. In consideration for the grant of the Licenses and
Services to Licensee and the adherence to the Non-Compete Restrictions set forth
in Section 12(c) herein for the Term (as such term is defined herein below) and
in accordance with the terms of this Agreement, the Licensee shall pay (i) to
Licensor a licensing fee (the "Licensing Fee") up to a sum equal to Two Hundred
Thousand Dollars ($200,000) in cash plus (ii) to the Shareholders (as such term
is defined herein below) an aggregate of Two Million (2,000,000) shares of
Parent's common stock (the "Stock Consideration") as is more fully set forth
herein below:
(a) Initial Cash Payment At Signing. In consideration of Licensee's
right to open the first office (collectively, the "Initial Office"), the
Licensee shall pay a Licensing Fee equal to the sum of Twenty-Five Thousand
Dollars ($25,000) in cash upon the execution and signing of this Agreement (the
"Initial Portion").
(b) Second Cash Payment. In consideration of Licensee's right to
open three additional offices, Licensee shall pay Seventy-Five Thousand Dollars
($75,000) in cash to the Licensor upon request by Licensee for Products and
Services from DreamHome with respect to any of the next three (3) Offices.
(c) Additional Cash Payments. Licensee shall have the option to open
four (4) additional Offices each with the consultation and consent of Licensor,
and each such consent shall not be unreasonably withheld. Licensee shall pay to
Licensor fees in the amount of Twenty-Five Thousand Dollars ($25,000) upon
request by Licensee for Products and Services from DreamHome with respect to
each of the additional four (4) Offices to be paid as upon request by Licensee
for Services and Products hereunder.
(d) Stock Consideration. The Licensee shall also pay to Licensor a
one (1) time stock grant of Two Million (2,000,000) restricted shares of
Parent's post-reverse split common stock on a one hundred (100) to one (1) basis
(the "Shares"), One Million (1,000,000) shares of which shall be issued to Mr.
Xxxx Xxxxx and the remaining One Million (1,000,000) shares shall be issued to
Xx. Xxxxx Xxxxxxx (Mssrs. Xxxxx and Xxxxxxx are sometimes referred to as the
"Shareholders" or the "Key Employees"). Each Party agrees that for the first
calendar year following the date of issuance of the Stock Consideration to the
Shareholders, the Shareholders shall vote the Shares as directed by the
then-current Chief Executive Officer of Licensee.
5. Management Fees.
(a) Notwithstanding Sections 2(b) and 4 herein, in consideration for
the daily management and supervision of each Office, Licensee shall pay a
management fee ("Management Fee") to the Licensor equal to seven percent (7%) of
all home improvement sales made by all Offices, in the aggregate (collectively,
the "Business") to be paid monthly within thirty (30) days of the end of each
month. Reconciliation of these amounts shall occur no less than quarterly. Once
per calendar quarter, Licensor shall have the absolute right to examine, or
cause to be examined by its representatives, the books and records of Licensee
by making request for same to Licensee at any time during the term of this
Agreement and Licensee shall make available to Licensor and/or its
representatives its books and records without exception within five (5) business
days of any such request. Failure by Licensee to comply with this provision
shall be considered a material breach of this Agreement.
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6. Additional Agreements.
(a) Licensee shall:
(i) use its best efforts to (a) secure office space consistent
with existing DreamHome offices equal to not less than One Thousand (1,000)
square feet of commercial property for each Office location. In addition,
Licensee shall be responsible for the installation and continuation of all
utilities, including telephone and internet service, for each Office. Licensee
shall also be responsible for the purchase of furniture, fixtures and equipment
necessary for normal and ordinary business operations consistent with the
existing operations of DreamHome;
(ii) through consultation with Licensor, provide all necessary
resources required for the continuous hiring, training and daily management of
the staff of each Office. Such staff shall include, at a minimum, a full-time
Sales & Finance Manager, a full-time Marketing & Installation Manager, Sales
Representatives and Canvas Marketers;
(iii) ensure that the Management Fee is accurately calculated
and delivered timely with appropriate support in accordance with Section 5
herein above;
(iv) maintain the accounting books of each Office in
accordance with generally accepted accounting principles; and
(v) obtain insurance from an insurer of recognized financial
responsibility against such losses and risks and in such amounts as Licensee's
management believes to be prudent and customary in the home remodeling business.
Proof of such insurance shall be provided promptly by Licensee to Licensor upon
Licensor's request.
(b) Licensee and Licensor shall work together and use their best
efforts to:
(i) identify and mutually agree upon up to eight (8) and not
less than four (4) locations in new markets outside the Business Territory to
develop Offices in accordance with the terms of this Agreement and consistent
with the existing operations of DreamHome;
(ii) open two (2) new Offices in new markets outside the
Business Territory in accordance with the terms of this Agreement and consistent
with the existing operations of DreamHome not later than June 30, 2006 (the
"Initial Offices") or by such alternative date as may be mutually agreed upon in
writing by the Parties;
(iii) upon the successful opening of the Initial Offices,
identify two (2) additional locations in new markets outside of the Business
Territory and to then use their best efforts thereafter to open two (2)
additional Offices (one (1) additional Office in each new market) in accordance
with the terms of this Agreement and consistent with the existing operations of
DreamHome not later than December 31, 2006 or by such alternative date as may be
mutually agreed upon in writing by the Parties; and
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(iv) at the option of Licensee, each with the consultation and
consent of Licensor (such consent not to be unreasonably withheld), open four
(4) additional Offices in accordance with the terms of this Agreement and
consistent with the existing operations of DreamHome not later than December 31,
2007 or by such date as may be mutually agreed upon in writing by the Parties.
7. Ownership and License Restrictions; Indemnity.
(a) Ownership of the Product. Licensor retains all right and title
to and interest in the Products.
(b) Indemnity. With the exception of the Tracker Software, Licensor
agrees to defend, indemnify, and hold Licensee, its affiliates, and their
respective officers, directors, employees, agents and other representatives
harmless from and against any third party claims, losses, judgments, damages,
liabilities, costs and expenses (including, without limitation, reasonable
attorneys' fees and legal expenses) (collectively, the "Claims") against
Licensee based upon a claim that any Product furnished hereunder by Licensor
infringes any patent, copyright, trademark or other intellectual property right,
and to pay costs and damages awarded upon any such claim in any suit. Licensor's
obligation to indemnify with respect to this Section 7(c) will be subject to the
following terms and conditions. Licensee shall notify Licensor in writing of any
such infringement or injury claim within thirty (30) days of Licensee's initial
awareness of such claim, and shall provide Licensor with such assistance and
cooperation as Licensor may reasonably request from time to time in connection
with the defense thereof. In the event Licensee determines that Licensor is
unable or unwilling to defend the claim, Licensee may assume, at Licensor's sole
cost and expense, control of the defense of the claim. If any settlement
requires an affirmative obligation of, results in any ongoing liability to, or
prejudices or detrimentally impacts in any way, the Licensee, then such
settlement shall require the Licensee's written consent.
8. Term; Termination.
(a) Term. Commencing on the date hereof (the "Effective Date"), this
Agreement shall have a term (the "Term") of twenty (20) years, with the option
for Licensee to exercise two (2) consecutive ten (10) year options to extend in
each case upon thirty (30) days prior written notice to Licensor.
(b) Termination for Convenience; Economics.
(i) If at any time after the eight (8) month anniversary of
the opening of a given Office (the "Initial Performance Period"), Licensee
determines, in accordance with applicable Generally Accepted Accounting
Principals ("GAAP"), that such Office has yielded a net loss from its home
remodeling sales during the Initial Performance Period, Licensee shall have the
option to terminate this Agreement with respect to such Office upon thirty (30)
days prior written notice to Licensor.
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(ii) At any time after the twenty-four (24) month anniversary
of the Effective Date, and provided further that Licensee is not in default of
any term or condition or this Agreement, Licensee shall be entitled to buy out
Licensor's interest in the management fee for an amount equal to fifteen percent
(15%) of the annualized gross revenues of the Business (calculated at four (4)
times the gross revenues of the Business during the three (3) month period
immediately preceding the date of such termination notice).
(iii) After the Term, this Agreement shall continue until a
Party terminates for any reason or no reason upon ninety (90) days prior written
notice to the other Parties.
(c) Termination by the Parties. Any Party may terminate this
Agreement at any time if another Party:
(i) materially breaches this Agreement and does not cure the
breach within fifteen (15) days of receipt of written notice of such breach;
(ii) becomes the subject of a voluntary petition in bankruptcy
or any voluntary proceeding relating to insolvency, receivership, liquidation,
or composition for the benefit of creditors; or
(iii) becomes the subject of an involuntary petition in
bankruptcy or any voluntary proceeding relating to insolvency, receivership,
liquidation, or composition for the benefit of creditors, if such petition or
proceeding is not dismissed within sixty (60) days of filing.
(d) Automatic Termination. This Agreement shall terminate upon the
consummation of a definitive purchase agreement by and between Licensee and
DreamHome pursuant to the exercise by Licensee of the Option to purchase the
business of DreamHome as set forth in Section 4 herein above.
9. Representations, Warranties and Covenants of Licensee and Parent.
During the Term of this Agreement and in performing its obligations hereunder,
Licensee and Parent represent, warrant and covenant that:
(a) Organization. Licensee is a company, duly incorporated and
validly existing under the laws of the State of Nevada, and Parent is a company,
duly incorporated and validly existing under the laws of the State of Delaware,
and except as disclosed in Schedule 9(a) attached hereto, both Licensee and
Parent have filed all reports required to be filed with all governing bodies and
all other required governmental authorities;
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(b) Authority. The execution and delivery of this Agreement by
Licensee and Parent have been duly authorized by all necessary corporate action
of Licensee and Parent;
(c) Validity; No Violations. This Agreement represents a valid and
binding obligation of Licensee and Parent, enforceable against Licensee or
Parent in accordance with its terms. Neither the execution and delivery of this
Agreement, nor the consummation by Licensee and Parent of the transactions
contemplated by this Agreement, will conflict with or result in a breach of any
provision of Licensee's governing documents; and
(d) Property Protection. Licensee shall take commercially reasonable
efforts to preserve the ownership and rights of Licensor to the Products and
shall notify Licensor promptly if it becomes aware of any unauthorized use of
the Products.
10. Representations and Warranties of Licensor. Licensor hereby represents
and warrants to Licensee and Parent the following:
(a) Organization. Licensor is a company duly incorporated and
validly existing under the laws of Virginia and has filed all reports required
to be filed with all governing bodies and all other required governmental
authorities;
(b) Authority. The execution and delivery of this Agreement by
Licensor has been duly authorized by all necessary action of Licensor;
(c) Validity; No Violations. This Agreement represents a valid and
binding obligation of Licensor, enforceable against Licensor in accordance with
its terms. Neither the execution and delivery of this Agreement, nor the
consummation by Licensor of the transaction contemplated by this Agreement will
(i) conflict with or result in a breach of any provision of Licensor's governing
documents or in a default (or give rise to any right of termination,
cancellation or acceleration) under any of the terms, conditions or provisions
of any note, lien, bond, mortgage, indenture, license, lease, agreement or other
instrument or obligation to which the Licensor is a party, or by which the
Licensor or any of its properties or assets are bound; (ii) violate any
judgment, order, writ, injunction or decree of any governmental authority
applicable to Licensor, or any of its properties, assets or outstanding debt or
equity securities; or (iii) cause or give any person grounds to cause the
maturity of any liability or obligation of Licensor to be accelerated or
increased. No consent of any third party is required in connection with the
execution, delivery or performance of this Agreement by Licensor;
(d) Title to Products. Other than the Tracker Software, Licensor
owns the Products free and clear of any claims, demands, encumbrances, rights of
third parties and other interest of any kind or character, and no condition
exists which interferes with the intent and purpose of this Agreement. Licensor
is not, and has not received any notice alleging that Licensor is, infringing
upon, likely to infringe upon, or otherwise acting adversely to any known right
or claimed right of any person under or with respect to the Products.
(e) No Acts in Contravention. Licensor has not done, or agreed to
do, any act in contravention of the intent and purpose of this Agreement.
Licensor hereby covenants that neither it nor its affiliates, agents or related
companies have or will during the Term grant any rights to any other person or
company in connection with the Products and Services; and
11. Confidential Information.
(a) No Party may disclose any of the terms and conditions of this
Agreement to any third party without the express written consent of the other
Parties, with the exception of such disclosures as may be reasonably necessary
to the disclosing Party's bankers, attorneys, or accountants or except as may be
required by law. No Party will disclose or use any other Confidential
Information of the other Parties without the prior written consent of the other
Parties. Each Party agrees to protect the Confidential Information of the other
Parties disclosed to it to the same extent and in the same manner that it would
protect its own like Confidential Information. In no event will efforts fall
below a level of reasonable and due care, which will include limiting disclosure
to only those personnel who have a need to know for the purposes of this
Agreement. Each Party will notify the other Parties promptly upon discovery of
the loss of any item containing Confidential Information of another Party and of
any circumstances of which it has knowledge surrounding any unauthorized
possession, use, or knowledge of Confidential Information of another Party.
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(b) "Confidential Information" means nonpublic information that the
disclosing Party (a) discloses in tangible form and marks as "Confidential" or
its equivalent at the time of disclosure, or (b) discloses in non-tangible form,
and then summarizes and designates as "Confidential" or its equivalent in a
written memorandum delivered to the receiving Party's representative within
thirty (30) days of disclosure. Confidential Information includes, but is not
limited to, the terms and conditions of this Agreement and any attached
exhibits. Confidential Information does not include any information which is (a)
now, or later becomes, available in the public domain without the fault of the
receiving Party, (b) disclosed or made available to the receiving Party by a
third party without restrictions and without breach of any relationship of
confidentiality, (c) developed by the receiving Party without use of the
disclosing Party's Confidential Information, (d) or was in the receiving Party's
lawful possession prior to the disclosure and had not been obtained by such
Party from the disclosing Party, (e) furnished by the disclosing Party to a
third party without restriction on disclosure, (f) required to be disclosed
pursuant to subpoena or other legal requirement, provided that in such
circumstances the Party subject to such requirement will provide prompt notice
of the requirement to the other Parties and will cooperate with such other
Parties (at such other Parties' expense) as it may reasonably request in any
attempts to prevent or minimize the extent of the required disclosure, or (g)
excluded by written agreement among the Parties.
12. Non-Competition.
(a) Definitions. As used herein:
(i) "Affiliate" means, with respect to any specified Person,
any other Person that, directly or indirectly, through one or more
intermediaries, controls, is controlled by or is under common control with such
specified Person.
(ii) "Competing Product" means: (A) product, equipment, device
or system that has been designed developed, manufactured, assembled, promoted,
sold, distributed, resold, installed, supported, maintained, repaired,
refurbished, licensed, sublicensed, financed, leased or subleased by or on
behalf of the Licensee (or any predecessor of the Company) at any time on or
prior to the date of this Agreement or at any time during the Term, or in the
event Licensee exercises its Non-Compete Option as set forth in Section 12(c)
herein below, during the Non-Competition Period; or (B) product, equipment,
device or system that is substantially the same as incorporates, is a material
component or part of, is based upon, is functionally similar to or competes in
any material respect with any product, equipment, device or system of the type
referred to in clause (A) or clause (B) of this sentence.
(iii) "Competing Service" means any: (A) service that has been
provided, performed or offered by or on behalf of Licensee at any time on or
prior to the date of this Agreement; (B) service that is provided, performed or
offered by the Licensee at any time during the Term, or in the event Licensee
exercises its Non-Compete Option as set forth in Section 12(c) herein below,
during the Non-Competition Period; (C) service that facilitates, supports or
otherwise relates to the design, development, manufacture, assembly, promotion,
sale, supply, distribution, resale, installation, support, maintenance, repair,
refurbishment, licensing, sublicensing, financing, leasing or subleasing of any
Competing Product; or (D) service that is substantially the same as, is based
upon or competes in any material respect with any service referred to in clauses
(A), (B) or (C) of this Section 12(a)(iii).
(iv) A Person shall be deemed to be engaged in "Competition"
if: (A) such Person or any of such Person's subsidiaries or other Affiliates is
engaged directly or indirectly in the design, development, manufacture,
assembly, promotion, sale, supply, distribution, resale, installation, support,
maintenance, repair, refurbishment, licensing, sublicensing, financing, leasing
or subleasing of any Competing Product; or (B) such Person or any of such
Person's subsidiaries or other Affiliates is engaged directly or indirectly in
providing' performing or offering any Competing Service.
(v) "Person" means any: (A) individual; (B) corporation,
general partnership, limited partnership, limited liability partnership, trust,
company (including any limited liability company or joint stock company) or
other organization or entity; or (C) governmental body or authority.
(vi) "Restricted Territory" means all territory within a one
hundred (100) mile radius of each Office, and in the event that Licensee
exercises its Non-Compete Option as set forth in Section 12(c) herein below, all
territory within a one hundred (100) mile radius of each Designated Office.
(b) Non-Competition During Term. Licensor agrees that during the
Term, Licensor shall not, and shall not permit any of its Affiliates to: (A)
engage directly or indirectly in Competition in any Restricted Territory; or (B)
directly or indirectly be or become an officer, director, stockholder, owner,
co-owner, Affiliate, partner, promoter, employee, agent, representative,
designer, consultant, advisor, manager, licensor, sublicensor, licensee or
sublicensee of, for or to, or otherwise be or become associated with or acquire
or hold (of record, beneficially or otherwise) any direct or indirect interest
in, any Person that engages directly or indirectly in Competition in any
Restricted Territory (collectively, the "Non-Compete Restrictions"); provided,
however, that the Licensor may, without violating this Section 12(b), own, as a
passive investment, shares of capital stock of a publicly-held corporation that
engages in Competition if: (X) such shares are actively traded on an established
national securities market in the United States, (Y) the number of shares of
such corporation's capital stock that are owned beneficially (directly or
indirectly) by the Licensor and the number of shares of such corporation's
capital stock that are owned beneficially (directly or indirectly) by the
Licensor's Affiliates collectively represent less than one percent (1%) of the
total number of shares of such corporation's capital stock outstanding, and (Z)
neither the Licensor nor any Affiliate of the Licensor is otherwise associated
directly or indirectly with such corporation or with any Affiliate of such
corporation.
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(c) Non-Competition Upon Termination. In the event that this
Agreement terminates due to Licensor's breach of any of the terms contained
herein, Licensee shall have the option (the "Non-Compete Option") to impose upon
Licensor, for a period of three (3) years commencing on the date of such
termination (the "Non-Competition Period"), the Non-Compete Restrictions set
forth in Section 12(b) herein above with respect to each Office designated by
Licensee at its sole discretion (such designated Offices are hereinafter
collectively referred to as the "Designated Offices"). In the event that
Licensee exercises the Non-Compete Option pursuant to this Section 12(c),
Licensee shall be obligated to pay to Licensor, as consideration for such
Non-Compete Restrictions, a fee equal to two percent (2%) of all home
improvement sales made by the Designated Offices, in the aggregate, less taxes,
to be paid quarterly per annum within thirty (30) days of the end of each fiscal
quarter for the Non-Competition Period.
13. Limited Liability. No Party will be liable to another Party, or to
anyone who may claim any right due to a relationship with such Party, for any
acts or omissions in the performance of Services under the terms of this
Agreement or on the part of employees or agents of such other Parties. Each of
the Parties hereto will defend, indemnify and hold the other Parties and their
agents, officers, directors and employees harmless from and against any and all
liabilities, losses, damages, costs and expenses (including reasonable legal
fees and expenses) associated with any claim or action brought against the other
Parties or their agents, officers, directors and employees by a third party
arising out of (i) any breach or alleged breach of any of the representations
and warranties contained herein, (ii) any breach or alleged breach of any other
covenant contained herein, or (iii) wrongful or negligent acts. Each Party shall
notify the other Parties in writing promptly of any claim received, provided,
however, that the failure to give such notice shall not relieve such Party of
its obligations hereunder, except to the extent that such Party was actually and
materially prejudiced by failure. The indemnifying Party will have the sole
right (except in case of a conflict) to conduct the defense of any such claim or
action and all negotiations for its settlement or compromise unless otherwise
agreed to in writing. However, if the indemnifying Party, after receiving notice
of any such claim, fails immediately to begin the defense of such claim or
action, the other Party may (without further notice) retain counsel and
undertake the defense, compromise, or settlement of such claim or action at the
expense of such other Party. DreamHome is acting hereunder solely in the role of
an advisor and licensor to Licensee. DreamHome shall not make any decisions for
Licensee or enter into any contracts for or on behalf of Licensee, and it is
Licensee's responsibility to ensure that any third party dealing with Licensee
is made fully aware of these limitations of DreamHome's role with respect to
Licensee. It is agreed and understood by Licensee that DreamHome shall not bear
any responsibility and/or liability, financial or otherwise, for the operations
and activities of Licensee, its officers, directors, employees, agents or
representatives; that Licensee has no power or authority whatsoever to bind,
commit, or encumber DreamHome, in any manner, whether contractually or
otherwise; and that any attempt to do so by Licensee shall be void ab initio and
shall place Licensee in default under this Agreement. Licensee will defend,
indemnify and hold Licensor and its agents, officers, directors and employees
harmless from and against any and all liabilities, losses, damages, costs and
expenses (including reasonable legal fees and expenses) associated with any
claim or action brought against the other Parties or their agents, officers,
directors and employees by a third party arising out of any breach or attempted
breach of this provision.
14. Arbitration. All disputes, claims and/or requests for specific
contractual performance, or other equitable relief, or damages or any other
matters in question by and between the Parties arising out of this Agreement
shall be submitted for arbitration, solely. Demand shall be submitted for
arbitration, solely. Demand shall be made to the American Arbitration
Association and shall be conducted in Northern Virginia by a one-person
arbitrator (the "Arbitrator"), unless the Parties mutually agree otherwise.
Arbitration shall be in accordance with the commercial rules of the American
Arbitration Association. Any award of the Arbitrator shall be final and judgment
may be entered upon it in any court having jurisdiction thereof, and the
prevailing Party shall be entitled to costs and reasonable attorneys' fees
arising out of such arbitration.
15. Miscellaneous.
(a) Assignment. Neither Licensor nor the Key Employees shall assign
this Agreement without the prior written consent of Parent. The term
"assignment" includes, without limitation: (1) the sale of twenty-five percent
(25%) of the capital stock of the assignor to a third party, (2) a sale by
Licensor of any of Licensor's right, title and interest in the Products or
Software to a third party, (3) the assignment or sale of any and all interests
held by the Key Employees in the business of Licensor and (4) the resignation of
either Key Employee or the termination by Licensor of the employment of either
Key Employee. In the event of a permitted assignment, this Agreement shall be
binding upon such successor or assign as if such party were an original party
hereto.
(b) Notices. Whenever notice is required to be given under the terms
of this Agreement (including the Termination Notice), such notice shall be in
writing and delivered by hand or by international courier addressed to each
Party at the following addresses or to such other addresses as the Parties may
give notice in accordance herewith:
If to Licensee or Parent: Elite Flight Solutions, Inc.
000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxx Xxxxxxx,
Chief Executive Officer of Parent
With a copy to: Xxxxxxxxxxx & Xxxxxxxx Xxxxxxxxx Xxxxxx LLP
000 Xxxxx Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx, Esq.
10
If to Licensor or DreamHome Remodeling, Inc.
the Shareholders: 0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxx Xxxxx, Chief
Executive Officer
With a copy to: Xxxxxx X. Xxxxxxx
000 Xxxxxxxxxxxx Xxxxxx, XX
Xxxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(c) All such notices (including the Termination Notice) shall be
deemed to be effective upon receipt.
(d) Governing Law. This Agreement and the rights and obligations of
the Parties hereto shall be construed and enforced in accordance with and
governing by the laws of the Commonwealth of Virginia.
(e) Compliance with Applicable Law. Each Party agrees to comply with
all applicable laws and regulations of appropriate governmental bodies in the
performance of this agreement, including regulations related to the exportation
of technical data, technology, or other products, and to obtaining all
applicable licenses and permits.
(f) Force Majeure. No Party will be liable hereunder by reason of
any failure or delay in the performance of its obligations hereunder (except for
the payment of amounts due under this Agreement) on account of strikes,
shortages, riots, insurrection, fires, flood, storm, explosions, acts of God,
war, governmental action, labor conditions, earthquakes, material shortages or
any other cause which is beyond the reasonable control of such Party.
(g) Brokers or Finders. Each Party represents to each other that
there are no other brokers or finders in this transaction and no other broker or
finder fees will be paid to any third party.
(h) Expenses. The Parties hereto represent to each other that they
have and will continue to bear their respective expenses in connection with
preparing for and consummating the transactions contemplated by this Agreement.
(i) Severability. If any term or other provision of this Agreement,
or any application thereof to any circumstances is invalid, illegal or incapable
of being enforced by any rule of law, or public policy in whole or in party,
such provision or application shall to that extent be severable and shall not
effect other provisions or applications of this Agreement.
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(j) Entire Agreement. This Agreement, including all Schedules
attached hereto, is the complete and exclusive agreement between the Parties
with respect to the subject matter hereof, and supersedes any previous or
contemporaneous agreement, proposal, commitment, or representation, whether oral
or written, and any other communications between the Parties in relation to such
subject matter. No representation, condition, understanding, or agreement of any
kind, oral or written, will be binding upon the Parties unless incorporated
herein. This Agreement may not be modified or amended except by an agreement in
writing signed by duly authorized representatives of both Parties.
(k) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one instrument. Confirmation of execution by a
facsimile of the signature page shall be binding upon the Party so confirming.
(l) Plurals; Gender; Headings. Under this Agreement, unless the
context otherwise requires, words in the singular number or in the plural number
shall each include the singular number and the plural number, and the use of any
gender shall include all genders. The headings in this Agreement are for
reference purpose only and shall not limit or otherwise affect the meaning or
interpretation of this Agreement.
(m) Further Assurances. Each Party hereto shall do and perform or
cause to be done and performed all further acts and things and shall execute and
deliver all other agreements, certificates, instruments, and documents as any
other Parties hereto reasonably may request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
(n) Amendment and Modification. This Agreement may not be amended,
nor may any provision hereof be modified or waived, except by an instrument in
writing duly signed by the Party to be charged.
(o) Waiver of Jury Trial. AS A MATERIAL INDUCEMENT FOR EACH PARTY
HERETO TO ENTER INTO THIS AGREEMENT, THE PARTIES HERETO HEREBY WAIVE ANY RIGHT
TO TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATED IN ANY WAY TO THIS AGREEMENT
AND/OR ANY AND ALL OF THE OTHER DOCUMENTS ASSOCIATED WITH THIS TRANSACTION. ANY
AND ALL CLAIMS SHALL BE SUBMITTED FOR ARBITRATION IN ACCORDANCE WITH SECTION 14
HEREIN.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, this License and Purchase Option Agreement has
been signed by or on behalf of each of the Parties hereto, each as of the date
first above written.
DREAMHOME SOLUTIONS, INC.
By: /s/ Xxxxx Xxxxxxx
-----------------------------
Name: Xxxxx Xxxxxxx
Title: Chief Executive Officer
ELITE FIGHT SOLUTIONS, INC.
By: /s/ Xxxxx Xxxxxxx
-----------------------------
Name: Xxxxx Xxxxxxx
Title: Chief Executive Officer
DREAMHOLDINGS, LLC
By: /s/ Xxxx Xxxxx
-----------------------------
Name: Xxxx Xxxxx
Title: Chief Executive Officer
DREAMHOME REMODELING, INC.
By: /s/ Xxxx Xxxxx
-----------------------------
Name: Xxxx Xxxxx
Title: Chief Executive Officer
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SCHEDULE 2(e)(v)
DESCRIPTION OF TRACKER SOFTWARE
SCHEDULE 9(a)
ORGANIZATION
