AGREEMENT
AGREEMENT
THIS
AGREEMENT (this “Agreement”)
is
made as of November 28, 2006 (the “Effective
Date”),
by
and between PRO
ELITE, INC.,
a New
Jersey corporation (“Pro
Elite”),
on
the one hand, and RUMBLE
WORLD ENTERTAINMENT, INC., a
Hawaii
corporation and its wholly owned subsidiary RUMBLE
WORLD ENTERTAINMENT LLC,
a
Hawaii limited liability company (collectively, “RWE”),
on
the other hand. Pro Elite and RWE are referred to as the “Participants.”
RECITALS
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A.
|
RWE
is the sole and exclusive owner of certain intellectual property
set forth
on Schedule A (the “Licensed
Property”)
and is willing to grant to Pro Elite the sole and exclusive right
and
license in the Licensed Property on the terms set forth herein.
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|
B.
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The
business focus of Pro Elite is in Martial Events, and Pro Elite intends
to
produce live events in Martial Events including events using the
Licensed
Property.
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|
C.
|
Pro
Elite has or will form a wholly owned subsidiary (the “Subsidiary”)
whose sole business will be to produce events in Martial Arts utilizing
the Licensed Property (“Events”)
which will be marketed under the brands Rumble World, RWE and/or
Rumble
World Entertainment and the services of certain RWE personnel as
set forth
herein.
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|
D.
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Pro
Elite shall also be granted the right to distribute on an exclusive
basis
RWE’s existing content on all media subject to the terms set forth
herein.
|
In
consideration of the foregoing recitals and the mutual promises hereinafter
set
forth, the sufficiency and adequacy of which consideration the Participants
hereby acknowledge, the parties hereto, intending to be legally bound, agree
as
follows:
AGREEMENT
| 1. |
License.
|
|
| 1.1 | For the consideration set forth in Xxxxxxx 0, XXX hereby grants to Pro Elite the sole and exclusive right and license (the “License”) to use the Licensed Property for any purpose, services or products anywhere in the world. Subject to the prior written approval of Xxx Xxx Xxxx, which approval shall not be unreasonably withheld or delayed, Pro Elite may grant sublicenses and authorize others to use the Licensed Property. RWE’s failure to respond within seven days upon written notice thereof shall be deemed approval. |
| 1.2 | Unless earlier terminated as provided herein, the exclusive License granted shall be for a period of three years (the “Term”) except that Pro Elite shall have the right to use the Licensed Property to sell without charge to Pro Elite after the termination of the Term products produced prior to the termination of the Term and to distribute, with the right to subdistribute, and otherwise exploit in perpetuity for all media now existing or hereafter devised the Event Content as defined in Section 2.3. Upon termination, subject to the preceding sentence, footage from content utilizing the Licensed Property or content or property provided by RWE not constituting Event Content shall revert back to RWE, and thereafter Pro Elite may use only such content as licensed by RWE at the time of the termination of this Agreement and for payment/compensation to be negotiated in good faith by the parties. |
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| 1.3 |
Pro
Elite agrees that all services and products containing the Licensed
Property shall be of high standard and shall be at least of similar
quality as similar services and products being used, sold or distributed
in the same industry. Pro Elite will place all appropriate legal
notices
where possible regarding the Licensed Products and, upon written
request
of RWE, will submit samples for RWE’s approval, not to be unreasonably
withheld or delayed.
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| 2. |
Events
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|
| 2.1 |
During
the Term, neither Pro Elite nor the Subsidiary shall be required
to
produce any specific or minimum number of Events. The Subsidiary
shall
have the sole right to determine when and where any Event will take
place
and will have the responsibility for organizing, conducting and exploiting
the Event.
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| 2.2 |
Prior
to each Event, the Participants shall agree upon a budget for each
Event,
and Pro Elite shall provide, as and when required, the funds necessary
to
produce each Event (“Production
Expenses”),
it being understood, however, that, to the maximum extent possible,
all
production costs shall be paid out of revenues from the Event. Pro
Elite
shall have control of and approval rights with respect to all expenditures
and RWE shall have no right to incur any expense or enter into any
agreement with respect to any Event without the advance written approval
of Pro Elite.
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| 2.3 |
All
content developed by the Subsidiary with respect to Martial Arts
and
Events, including all trademarks, good will and the portion of the
business pertaining to and symbolized by such trademarks, which shall
also
include trademarks as word marks, independent of any design, as well
as
part of any design, and the registration of such trademarks, if any,
and
including without limitation, all common law rights therein, all
designs
and logos related thereto, and all stylized versions thereof, together
with the right to recover for damages and profits for the past
infringement thereof (the “Event
Content”),
shall be exclusively owned by Pro Elite or the Subsidiary. The Event
Content shall also include any and all domain names and websites
developed
by the Subsidiary or Pro Elite, copyrights, if any, in and to the
marks,
domain names and websites, and all copyrights owned or controlled
by the
Subsidiary or Pro Elite related to such marks, domain names and websites
throughout the universe, and all derivative rights and all rights
to other
versions of any of the foregoing at any time or times owned or controlled
by the Subsidiary, throughout the universe. RWE shall have no rights
to
the Event Content.
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| 2.4 |
Pro
Elite shall have the exclusive right in perpetuity to distribute,
exploit
and otherwise turn to account (and authorize others to do so and
to grant
sublicenses and the right to sub-distribute) all Event Content arising
from each Event over video, Internet, television and all other media
whether now known or hereafter devised. After reimbursement to Pro
Elite
for its hard costs, including dubbing and packaging, Pro Elite shall
receive a distribution fee of 20% of distribution proceeds from Events
if
the distribution is handled internally by Pro Elite and 30% of
distribution proceeds if Pro Elite utilizes the services of a third-party
distributor to handle the distribution, which shall include the fees
charged by the third-party
distributor.
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| 2.5 |
Pro
Elite or the Subsidiary shall have all rights to all intellectual
property
rights arising from the Events, including ancillary projects which
include
but are not limited to xxxxxxx xxxxxxxxxx shows, television programs,
and
other potential future media content and production (“Ancillary
Projects”).
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| 2.6 |
As
soon as practicable after receipt of gross proceeds (but in no event
later
than 75 days after the date of the Event), Pro Elite shall distribute
the
gross proceeds of each Event, including proceeds from gate, media,
licensing, merchandise, pay-per-view concessions and all other ancillary
revenue streams in the following
order:
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| (a) |
Reimbursement
to Pro Elite for Production Expenses and RWE Payments, as defined
below;
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| (b) |
Management
fee of 15% of the gross receipts of the Event (less the distribution
fee
referred to in Paragraph (b)) to be paid to Pro Elite;
and
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| (c) |
After
payment of all the foregoing expenses and fees and all other expenses
and
costs related to organizing, producing and exploiting the Event, Fifty
Percent of the remaining proceeds from the Event to be distributed
as
payment for the License to RWE, and the other Fifty Percent of the
remaining proceeds from the Event to be distributed to Pro
Elite.
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| (d) |
Any
excess of expenses and fees over revenues for an Event shall be carried
over to the next Event(s).
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| 2.7 |
Pursuant
to separate consulting agreements (a “Service
Agreement”)
to be negotiated, RWE shall provide to Pro Elite the exclusive services
in
the area of Martial Arts of Xxx Xxx Xxxx (“Penn”)
and another individual associated with and designated by RWE acceptable
to
Pro Elite (the “Designated
Employee”)and
the nonexclusive advisory services in the area of Martial Arts of
Xxxxx
Xxxxxxxxxx (“Xxxxxxxxxx”),
it being agreed that any existing employment or consulting agreement
covering Martial Arts with Penn and the Designated Employee will
be
terminated. For services of Penn, Pro Elite shall pay to RWE a monthly
fee
of $15,000 and for the services of the Designated Employee Pro Elite
shall
pay to RWE a monthly fee of $4,000. For the services of Nahabedian,
Pro
Elite shall pay to Nahabedian a monthly fee of $10,000. All payments
under
this Section 2.7 are defined as “RWE
Payments”.
The term for the Services Agreement with Penn shall be coextensive
with
the Term and the term with respect to the Designated Employee and
Xxxxxxxxxx shall be on an at will basis. Each Service Agreement shall
be
negotiated in good faith and shall enumerate the services to be
performed.
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| 2.8 |
During
the Term, neither RWE nor any affiliate of RWE, including Penn, shall
produce or develop, or exploit Martial Arts events or programming
or
provide directly or indirectly (through license or otherwise) any
RWE
content to any other third party.
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| 2.9 |
In
connection with the promotion and advertising of each Event, the
Subsidiary shall have the right to use and sublicense to third parties
all
of RWE’s existing content.
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| 2.10 |
Subject
to Section
2.2,
each party shall provide to the other an accounting of the expenses
incurred by such party for each Event which shall be consistent with
the
budget and subject to review by the other party in
advance.
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| 2.11 |
Penn
shall have the sole authority to act on behalf of RWE except that
Penn
shall have the right to designate from time to time an individual
to act
in his stead in the event of his death or disability (as such term
is to
be defined in the Service Agreement). Such individual shall be acceptable
to Pro Elite in its sole discretion and shall replace Penn for all
purposes hereunder including pursuant to the Services
Agreement.
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| 3. |
Negotiation
Right
|
During
the Term, Pro Elite shall have the exclusive right to negotiate for all
Ancillary Projects that RWE is currently contemplating, discussing or
negotiating with other parties as of the Effective Date (which such Projects
are
listed in Schedule
3),
other
than Events with respect to which the Company has rights pursuant to
Section
2.
Only
upon receipt of written notice from Pro Elite pursuant to Section
13
of this
Agreement that Pro Elite has chosen to waive its right to all or part of the
Ancillary Project may RWE then have the exclusive right to the part of the
Ancillary Project so waived. Such waiver shall not constitute a blanket waiver
of all Ancillary Projects, but shall be limited to that one Ancillary Project
specified in the waiver. RWE shall advise Pro Elite with as much advance notice
as possible as to all projects it is contemplating to undertake. If Pro Elite
elects to undertake an Ancillary Project of RWE (other than related to an
Event), it must do so on reasonable terms consistent with industry standards
and
must do so without delay. If it appears that Pro Elite is delaying such
Project(s), RWE shall provide Pro Elite with written notice of the delay and
a
formal request to move such Project along within thirty (30) days or RWE can
reclaim the Project and shop it elsewhere.
| 4. |
Distribution
Rights; Rights to Website
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| 4.1 |
In
addition to the distribution rights referred to in Section
2.4, during the Term, Pro Elite shall have exclusive rights to all
of
RWE’s existing content and shall have the right to distribute, exploit
and
otherwise turn into account such content over video, internet, television
and all other media whether now known or hereafter existing(“Distribution”).
The gross proceeds received by the Company from each Distribution
other
than from Events (the “Distribution
Proceeds”)
shall be distributed as follows:
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| (a) |
Should
Pro Elite handle the Distribution internally without the aid of a
third
party sub-distributor, the Distribution Proceeds shall be distributed
in
the following order: (i) Pro Elite shall receive a Distribution fee
of 20%
of the Gross Proceeds, (ii) Pro Elite shall recoup its hard costs of
distribution including dubbing and packaging and (iii) Fifty Percent
of
the then remaining net proceeds shall be distributed to RWE and the
other
Fifty Percent shall be distributed to Pro
Elite.
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| (b) |
Should
Pro Elite use the services of a third party sub-distributor to handle
the
Distribution, the Distribution Proceeds shall be distributed in the
following order: (i) Pro Elite shall receive a Distribution fee of
30% of
the Gross Proceeds, which shall include the fees charged by the third
party distributor, (ii) Pro Elite shall recoup its hard costs of
distribution including dubbing and packaging and (iii) Fifty Percent
of
the then remaining net proceeds shall distributed to RWE and the
other
Fifty Percent shall be distributed to Pro
Elite.
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| (c) |
RWE
shall be entitled to a full accounting of all expenses relating thereto,
and all expenses must be reasonable and within industry
standards.
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| 4.2 |
During
the Term, Pro Elite shall have the right to use any content RWE has
the
right to redistribute which appears on RWE’s website(s). To the extent
that RWE does not have the right to allow Pro Elite to use such content,
it will so advise Pro Elite and RWE shall use its best efforts to
obtain
permission for Pro Elite’s usage. With respect to any new content from
third parties, RWE shall use its best efforts to obtain clearance
for Pro
Elite’s use at the same time as RWE obtains rights for its use. RWE shall
provide on its sites appropriate links to Pro Elite’s websites. Pro Elite
shall have the right to approve the content, look, feel and functionality
of RWE’s websites.
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| 4.3 |
During
the Term, RWE shall make arrangements so that all RWE fighters shall
set
up their primary “fighter” page on a website(s) designated by Pro Elite
(the “Pro Elite Sites”) and put links on all its existing web properties
to the Pro Elite Sites.
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| 5. |
Option
to Purchase Membership Interests of RWE.
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| 5.1 |
At
the three-year anniversary of the Effective Date (the “Exercise
Date”),
Pro Elite shall have the option (the “Option”)
to purchase all outstanding membership interests of RWE, the purchase
price of which shall be the greater of (a) $7,000,000 or (b) an amount
equal to four times RWE’s share of the EBITDA for Events for (i) the
twelve months preceding the Exercise Date or (ii) upon RWE’s election,
the average
EBITDA of the three years preceding the Exercise Date (the “Purchase
Price”).
The Purchase Price shall be payable in cash, shares of common stock
of Pro
Elite (“Pro
Elite Shares”)
at Fair Market Value, as defined below, or a combination of both
cash and
Pro Elite Shares as determined by RWE. In the event that RWE elects
the
cash payout component and Company determines it is not in a financial
position to make the payment as a balloon, the parties agree to negotiate
in good faith a deferred payment plan. Fair Market Value shall be
equal to
the
average of the last reported closing prices of the Pro Elite Shares
for
the ten (10) consecutive trading days ending on the trading day prior
to
the Exercise Date.
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| 5.2 |
If
Pro Elite exercises the Option, the terms of the purchase, including
customary representations and warranties and indemnification provisions
and non-competition covenants from the principals of RWE shall be
set
forth in a definitive purchase agreement to be negotiated in good
faith,
and the Participants shall work in good faith and expeditiously towards
the closing of all of the transactions contemplated in such purchase
agreement. The assets of RWE shall be free and clear of all Liabilities.
From the Effective Date to the Exercise Date, neither RWE nor any
of its
members shall: (a) solicit any offer or enter into any agreement
for the
sale, transfer or other disposition of any membership interest or
any
assets of RWE or for any business combination or reorganization involving
RWE, to or with any other entity or person; (b) pursue any unsolicited
offer for any such sale, transfer or other disposition, business
combination or reorganization; and (c) furnish to any person or entity
(other than Pro Elite and its authorized agents and representatives)
any
non-public information concerning RWE or its business, financial
affairs
or prospects with the intent of permitting such person or entity
to
evaluate a possible acquisition of any membership interest or assets
of
RWE or a possible business combination or reorganization involving
RWE. In
the event RWE receives any unsolicited offer or inquiry from any
person,
it will promptly (and in any event within forty-eight (48) hours)
deliver
to Pro Elite copies of any written communications relating to such
unsolicited offer or inquiry as well as a complete and accurate
description of any such offer or inquiry and the response of RWE
thereto,
if any.
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| 5.3 |
In
order to determine whether Pro Elite will exercise the Option, RWE
shall
cause to afford to Pro Elite, and the accountants, counsel and other
representatives of Pro Elite, reasonable access at least sixty (60)
days
prior to the Exercise Date, during normal business hours to the
properties, books, contracts, commitments, records, financial reports
and
management of RWE. Each of RWE and Penn shall use reasonable efforts
to
furnish promptly to Pro Elite all information and documents concerning
the
business, operations and financial condition of RWE as Pro Elite
may
reasonably request to the extent that such documents contain information
not available to Pro Elite because of Pro Elite’s role in operating the
Events. Each of RWE and Penn shall provide to Pro Elite all information
reasonably requested by Pro Elite for the purpose of evaluating the
transaction contemplated hereby and not use, disclose or disseminate
any
confidential information or trade secrets which Pro Elite may provide
to
RWE in connection with the transactions contemplated
hereby.
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| 5.4 |
If
Pro Elite does not exercise the Option, such non-exercise shall not
in any
way affect Pro Elite’s exclusive ownership of the Event
Content.
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| 6. |
Issuance
of Pro Elite Warrants.
|
Within
10
business days of the Effective Date, Pro Elite shall issue to RWE a five year
warrant to purchase 750,000 Pro Elite Shares at an exercise price of $2.00
per
share. Such warrant shall vest over a term of three years on an equal
installment basis, on each of November 13, 2007, November 13, 2008 and November
13, 2009, and shall not vest on a pro-rata basis. In the event this Agreement
is
terminated pursuant to Section
11
of this
Agreement, RWE shall not thereafter be able to exercise any warrants that are
not vested, provided, that if Pro Elite terminates this Agreement without cause
prior to November 13 of any year, the vesting shall be pro rata for any period
of less than a year.
| 7. |
Observer
of and Appointment to the Board of Directors of Pro Elite.
|
During
the Term, Penn shall be invited to attend scheduled board meetings held by
the
Board of Directors of Pro Elite (the “Board”)
as a
silent and non-voting attendee. Subject to: (a) Pro Elite’s exercise of the
Option pursuant to Section
5
of this
Agreement, (b) the successful completion of the acquisition of RWE by Pro Elite
and (c) shareholder approval to appoint Penn to the Board, Penn shall be
appointed to the Board. Should Penn be unable to physically attend all such
meetings, all necessary efforts must be made to ensure that Penn may participate
by telephone.
| 8. |
Representations
and Warranties.
|
| 8.1 |
General.
As of the date hereof and as of the Closing, each of the Pro Elite
and RWE
represents and warrants to the other parties that: (a) such party
is duly
organized, validly existing and in good standing under the Laws of
the
jurisdiction of its formation; (b) such party has all necessary power
and
authority to execute, deliver and perform this Agreement and each
other
agreement or instrument contemplated hereby and thereby to which
it is or
will become a party (the “Related
Agreements”);
(c) the execution, delivery and performance of this Agreement and
each
Related Agreement to which it is a party have been duly authorized
by all
necessary action on the part of such party; (d) this Agreement and
each
Related Agreement to which it is a party, when executed and delivered
by
such party, will constitute, the valid and binding obligations of
it,
enforceable against it in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar Laws relating to or limiting creditors’
rights generally and equitable principles; and (e) the execution,
delivery
and performance by such party of this Agreement and each Related
Agreement
to which it is a party and the consummation by it of its obligations
hereunder and thereunder do not and will not (x) violate its charter
documents, (y) violate any applicable Law known to it, or (z) result
in any breach or default under any provision of any contract to which
it
is a party or by which it is bound.
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| 8.2 |
Legal
Proceedings.
Each of Pro Elite and RWE represents and warrants to the other parties
that (a) there are no claims, actions, suits, arbitrations, proceedings
or
investigations by or before any Governmental Authority pending or,
to such
party’s knowledge, threatened, that questions the validity of, or restrict
such party from consummating, the transactions contemplated by this
Agreement and (b) such party is not subject to any judgment, order,
writ,
injunction, civil investigative demand or decree of any Governmental
Authority that questions the validity of, or restrict such party
from
consummating, the transactions contemplated by this Agreement, and,
to
such party’s knowledge, no such judgment, order, writ, injunction, civil
investigative demand or decree is threatened against such
party.
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| 8.3 |
Rumble
World Entertainment.
Except as disclosed on Schedule A attached hereto, RWE represents
and
warrants to Pro Elite that it is the sole and exclusive owner of
all
right, title and interest in and to the Licensed Property, free and
clear
of any right, title, interest, claim, lien or encumbrance of any
kind or
nature whatsoever, and has all right, power and authority to enter
into
and perform this Agreement without the consent or approval of any
third
party. Any intellectual property RWE provides or licenses to Pro
Elite
shall be free and clear of third party claims and will not,
in
any way, infringe upon or violate any copyright or any rights of
privacy
or publicity, common law rights, or any other rights of any third
party or
constitute a libel or slander against any person, firm or
corporation.
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| 8.4 |
Consulting
Agreement.
Penn represents and warrants to Pro Elite that he has the right to
enter
into the Consulting Agreement applicable to
him.
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| 9. |
Assignment.
|
This
Agreement shall be binding upon and inure to the benefit of the parties named
herein and their respective successors and assigns. However, no assignment
by a
party to this Agreement of any of such party’s rights or obligations under this
Agreement shall in any manner release the assigning party of any of its
obligations under this Agreement without the prior written approval of each
of
the other parties to this Agreement. Furthermore, (a) if a party to this
Agreement is merged or consolidated with or into another entity, the surviving
entity shall be bound by all of the merging or consolidating party’s obligations
under this Agreement, and (b) if a party to this Agreement sells all or
substantially all of its assets to another Person, the purchaser shall be bound
by all of the selling party’s obligations under this Agreement. If control of
any party to this Agreement changes as a result of the sale or other transfer
of
ownership interests in such party, the rights and obligations of such party
under this Agreement shall not be altered by reason of the change of control.
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| 10. |
Confidentiality.
|
| 10.1 |
All
information which is not public knowledge disclosed heretofore or
hereafter by any party to any other party (including its attorneys,
accountants or other representatives) in connection with this Agreement
or
any related document, including the terms and conditions of this
Agreement
and information disclosed pursuant to nondisclosure agreements with
third
parties, shall be kept confidential
by such other party, and shall not be used by such other party otherwise
than for use as herein contemplated, except to the extent (a) it is
or hereafter becomes public knowledge (other than by action of the
disclosing party in breach of this Agreement) or becomes lawfully
obtainable from other sources, including a third party who is not
known to
be under an obligation of confidentiality to the party disclosing
such
information or to whom information was released without restriction;
or
(b) such other party is compelled to disclose such information
publicly by judicial
or administrative process or, in the opinion of its counsel, by other
Legal Requirements, and then only to the extent of such required
public
disclosure; or (c) such duty as to confidentiality and non-use is
waived by such non-disclosing party. In the event of termination
of
this
Agreement, each party shall exercise all reasonable efforts to return,
upon request, to the other parties all documents and reproductions
thereof
received from such other parties (and, in the case of reproductions,
all
such reproductions made by the receiving party) that include information
not within the exceptions contained in the first sentence of this
Section 10.1.
|
| 10.2 |
Notwithstanding
Section
10.1,
the parties may disclose the terms of this Agreement to its employees,
officers, and permitted agents and representatives,
customers
and suppliers as may be necessary or appropriate.
|
| 10.3 |
Representatives.
Each party shall require its employees, officers, customers, suppliers,
and permitted agents and representatives to comply with this Section
10.
|
| 11. |
Termination.
|
If
this
Agreement is terminated, all further obligations of the parties under this
Agreement will terminate without further liability of any party to another;
provided that the obligations of the parties contained in Sections
6,
8,
9,
10
and
11
will
survive any such termination, and provided further that if the Agreement is
terminated by Pro Elite For Cause all rights to the Licensed Property shall
continue until expiration of the three year period and all rights to the Event
Content shall continue in perpetuity. This Agreement may be terminated by (a)
mutual agreement of both Participants, (b) by either Participant For Cause
if
the breaching party has failed to correct its breach after fifteen days notice
from notice from the non-breaching party, or (c) by Pro Elite on thirty days’
notice. Notwithstanding the foregoing, a termination under this section will
not
relieve any party of any liability for a breach of, or for any misrepresentation
under this Agreement, or be deemed to constitute a waiver of any available
remedy (including specific performance if available) for any such breach or
misrepresentation. Notwithstanding anything to the contrary, upon termination,
the license to Pro Elite to use the Licensed Property shall be terminated
subject, however, to the provisions of this Section 11 and Section 1.2. No
termination shall affect the rights of the parties hereto to amounts due under
this Agreement including with respect to Events scheduled prior to termination
that actually occur.
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| 12. |
Survival.
|
The
representations and warranties of the parties contained in this Agreement shall
survive the execution and delivery of this Agreement and the Closing and shall
remain in full force and effect until the three-year anniversary of the Closing
(the “Expiration
Date”).
| 13. |
Miscellaneous.
|
| 13.1 |
Governing
Law.
This Agreement and any action instituted by any party with respect
to
matters arising hereunder shall be governed by and construed in accordance
with the laws of the State of California applicable to contracts
made and
performed in such State and without regard to conflicts of law doctrines.
|
| 13.2 |
Mediation;
Fees and Expenses.
|
| (a) |
Except
as otherwise provided in this Section
13.2(a),
no civil action regarding any controversy, dispute or claim under,
arising
out of, in connection with or in relation to this Agreement (including,
without limitation, the interpretation, construction, coverage, scope,
performance, non-performance, breach, termination, validity or
enforceability of this Agreement) may be commenced by the Subsidiary,
by
Pro Elite, RWE or any other Person who is subject to the terms of
this
Agreement until the matter has been submitted to the Los Angeles,
California office of JAMS for confidential mediation. The Subsidiary,
Pro
Elite, RWE or any other Person who is subject to the terms of this
Agreement may commence mediation by providing to JAMS and the other
parties a written request for mediation, setting forth the subject
of the
dispute and the relief requested. The parties agree to cooperate
with JAMS
and with one another in selecting a mediator from the JAMS panel
of
neutrals and in scheduling and conducting the mediation proceeding.
The
parties agree that they shall participate in the mediation in good
faith,
and that they shall share its costs equally. All offers, promises,
conduct
and statements, whether oral or written, made in the course of the
mediation by any of the parties, their agents, employees, experts
or
attorneys, and by the mediator and any JAMS employees, shall be
confidential, privileged and inadmissible for any purpose, including
impeachment, in any litigation or other proceeding involving the
parties,
provided that evidence that is otherwise admissible or discoverable
shall
not be rendered inadmissible or non-discoverable as a result of its
use in
the mediation.
|
| (b) |
Notwithstanding
the provisions of Section
13.2(a),
any party may seek temporary or preliminary injunctive relief or
other
equitable relief in any court of competent jurisdiction at any time
prior
to the commencement or completion of the mediation in order to preserve
the status quo pending the completion of the mediation process or
to
prevent immeasurable and irreparable injury that might result from
a
breach of this Agreement or of another agreement to which such party
is
subject.
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| (c) |
Except
for an action to obtain equitable relief that is described in Section
13.2(b),
a
civil action with respect to the matters submitted to mediation may
not be
commenced until after the completion of the initial mediation session
or
sixty days after the date of filing the written request for mediation,
whichever occurs first. Mediation may continue after the commencement
of a
civil action, if the parties so desire. The provisions of this
Section
13.2
may be enforced by any court of competent
jurisdiction.
|
| (d) |
The
unsuccessful party to any civil action that is permitted by this
Agreement
shall pay to the prevailing party all costs and expenses, including,
without limitation, reasonable attorneys' fees, incurred therein
by the
prevailing party, all of which shall be included in and as a part
of the
award rendered in such proceeding or action. For purposes of this
Section
13.2(d),
attorneys’ fees shall include, without limitation, fees incurred in
connection with post-judgment and post-award actions.
|
| 13.3 |
Counterparts;
Headings; Facsimile Execution.
This Agreement may be executed in two or more counterparts, each
of which
shall be deemed an original but all of which together shall constitute
one
and the same instrument. Any counterpart or other signature delivered
by
facsimile shall be deemed for all purposes as being a good and valid
execution and delivery of this Agreement by that party. The descriptive
headings of the Articles, Sections and subsections of this Agreement
are
for convenience only and do not constitute a part of this
Agreement.
|
| 13.4 |
Notices.
Any notice or other communication hereunder must be given in writing
and
(a) delivered in person, (b) transmitted by facsimile or
telecommunications mechanism, provided that any notice so given is
also
mailed as provided in clause (c), or (c) mailed by certified or registered
mail, postage prepaid, receipt requested, in each case to the address
or
facsimile number set forth below each party’s name on the signature pages
hereto, or to such other address or to such other Person as a party
shall
have last designated by such notice to the other party. Each such
notice
or other communication shall be effective (i) if given by
telecommunication, when transmitted to the applicable number so specified
in (or pursuant to) this Section
13.4
and an appropriate answerback is received or, if transmitted after
4:00
p.m. local time on the day following the date on which such notice
is
sent, (ii) if given by mail, three days after such communication
is
deposited in the mails with first class postage prepaid, addressed
as
aforesaid or (iii) if given by any other means, on the day when actually
received at such address.
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| 13.5 |
Books.
Pro Elite agrees to keep accurate books of accounts and records covering
all transactions relating to the Events, Event Content and exploitation
of
the Licensed Property, and to grant to an independent certified public
accountant, appointed by and at the expense of RWE, the right to
an
examination during mutually convenient business hours of the day
of said
books of accounts and records and of all other documents and materials
in
the possession or under the control of Pro Elite with respect to
the
subject matter and the terms of this Agreement, and the accountant
shall
have free and full access thereto for said purposes and for the purpose
of
making confidential extracts therefrom. Pro Elite hereby authorizes
and
shall require all persons or entities supplying services covered
by this
Agreement to supply accurate books and records of products produced
for
Pro Elite to RWE at RWE’s request. All books of accounts and records shall
be kept available for two years after the termination of this Agreement,
or any renewal thereof, and Pro Elite agrees to permit such an examination
during such two-year period.
|
| 13.6 |
Audit
by RWE.
RWE, upon giving to Pro Elite at least thirty (30) days advance written
notice by certified mail of its intention to do so, shall have the
right
to audit all books and records which Pro Elite is required to maintain
pursuant to the above. In the event that it has been finally determined
that Pro Elite has understated payments due RWE for any reporting
period,
Pro Elite shall forthwith and upon written demand pay to RWE the
amount,
if any, by which the actual payment due exceeds payments paid. If
the
amount of underpaid payment exceeds 5% of payments due in any quarter,
Pro
Elite shall also pay a 10% penalty based on the amount underpaid
for that
quarter. If Pro Elite has overstated sales or overpaid payments,
any
excess paid shall be credited against the next payment due. Pro Elite
shall forthwith and upon demand also pay RWE all costs, fees, penalty
and
expenses incurred by RWE in conducting such audit only in the event
that
it is finally determined that Pro Elite underpaid payments due by
more
than 5% of the payment due.
|
| 13.7 |
Waiver;
Amendment.
Any provision of this Agreement may be amended only by a written
instrument signed by Pro Elite and RWE. The waiver of any right under
this
Agreement requires only the written consent of the party waiving
such
right. Failure to insist upon strict compliance with any of the terms
or
conditions of this Agreement will not be deemed a waiver of such
term or
condition, nor will any waiver or relinquishment of, or failure to
insist
upon strict compliance with, any right hereunder at any one or more
times
be deemed a waiver or relinquishment of such right at any other time
or
times.
|
| 13.8 |
Entire
Agreement.
This Agreement constitutes the entire agreement among the parties
relative
to the subject matter of this Agreement. This Agreement replaces
and
supersedes all prior written or oral agreements, statements,
correspondence, negotiations and understandings among the parties
with
respect to the matters covered by this Agreement.
|
| 13.9 |
Representation
by Counsel; Interpretation.
The parties hereto acknowledge that each party to this Agreement
has been
represented by counsel in connection with this Agreement and the
transactions contemplated by this Agreement. Accordingly, any rule
of Law,
or any legal decision that would require interpretation of any claimed
ambiguities in this Agreement against the party that drafted it has
no
application and is expressly
waived.
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| 13.10 |
Severability.
If any provision of this Agreement is determined to be invalid, illegal
or
unenforceable, the remaining provisions of this Agreement, to the
extent
permitted by Law, shall remain in full force and effect provided
that the
essential terms and conditions of this Agreement for all parties
remain
valid, binding and enforceable.
|
| 13.11 |
Further
Assurance.
Each party agrees to cooperate fully with the other parties, to take
such
actions, to execute such further instruments, documents and agreements,
and to give such further written assurances, as may be reasonably
requested by any other party to evidence and reflect the transactions
described herein and contemplated hereby, and to carry into effect
the
intents and purposes of this
Agreement.
|
| 13.12 |
Expenses.
Subject to Section
13.2(d)
regarding payment of a prevailing party’s costs and expenses in a civil
action, each party will each pay its own expenses incident to the
negotiation, preparation and performance of this Agreement and the
transactions contemplated hereby and
thereby.
|
| 14. |
Certain
Definitions.
|
As
used
in this Agreement, the following terms have the following respective
meanings:
| 14.1 |
“For
Cause”
means the material breach of any provision of this Agreement or of
any
Service Agreement with Xxx Xxx Xxxx.
|
| 14.2 |
“Governmental
Authority”
means any court, tribunal, arbitrator, authority, agency, commission,
official or other instrumentality of the United States, any other
country
or any state, county, city or other political subdivision of the
United
States or any other country.
|
| 14.3 |
“Law”
means all federal, state, local, municipal, and other laws, statutes,
constitutions, ordinances, codes, edicts, decrees, injunctions,
stipulations, judgments, orders, rulings, rules, regulations, assessments,
writs, and requirements whether
temporary, preliminary or permanent, issued,
enacted, adopted, promulgated, implemented or otherwise put into
effect by
or under the authority of any Governmental
Authority.
|
| 14.4 |
“Legal
Requirement”
means any federal, state, local, municipal, foreign, international,
multinational or other administrative order, constitution, law, ordinance,
principle of common law, regulation, statute or
treaty.
|
| 14.5 |
“Liabilities”
means debts, liabilities and obligations, whether accrued or fixed,
absolute or contingent, matured or unmatured, determined or determinable,
known or unknown, including those arising under any law, action or
governmental order and those arising under any contract, agreement,
instrument, commitment or
undertaking.
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| 14.6 |
“Person”
shall be construed broadly and shall include an individual, a partnership,
a corporation, an association, a joint stock company, a limited liability
company, a trust, a joint venture, an unincorporated organization,
a
Governmental Authority or any department, agency or political subdivision
thereof, and any other entity or
organization.
|
| 14.7 |
“Martial
Arts”
means all types of martial arts and combat sports including mixed
martial
arts.
|
IN
WITNESS WHEREOF, the parties to this Agreement have executed this Agreement
as
of the date first above written.
|
PRO
ELITE, INC.
By:
_______________________________________
Name:
Title:
Address:
______________________________
__________________________
Facsimile:
______________________________
|
|
|
RUMBLE
WORLD ENTERTAINMENT, LLC
By:
_______________________________________
Name:
Title:
Address:
______________________________
__________________________
Facsimile:
______________________________
|
|
|
Agreed
to:
_____________________________
Xxx
Xxx Xxxx
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SCHEDULE
A
“Rumble
World Entertainment”
| 1. |
The
trademarks “RUMBLE WORLD ENTERTAINMENT”, “RWE”, “RUMBLE ON THE ROCK”, and
“ROTR” throughout the universe.
|
| 2. |
The
good will and portion of the business of RWE pertaining to and symbolized
by such trademarks.
|
| 3. |
Such
trademarks include, but are not limited to the words “RUMBLE WORLD
ENTERTAINMENT”, “RWE”, “RUMBLE ON THE ROCK”, and “ROTR” as word marks,
independent of any design, as well as part of any design, and the
registration of such trademarks, if any, and including without limitation,
all common law rights therein, all designs and logos related thereto,
and
all stylized versions thereof, together with the right to recover for
damages and profits for the past infringement thereof, and the good
will
and portion of the business of RWE pertaining to and symbolized by
such
trademarks.
|
| 4. |
The
domain names and websites xxxx://xxx.xxxxxxxxxxxxxxx.xxx/,
xxxx://xxx./xxxxxxxxxxx.xx (herein individually and collectively referred
to as “Website”) throughout the universe.
|
| 5. |
Copyrights
in and to the marks, the Website and all content contained therein,
and
all copyrights owned or controlled by RWE related to such marks, Website,
and content throughout the universe.
|
| 6. |
RWE
has no rights in or to the names and marks “XX XXXX”, “BJ XXXX.XXX”, and
“XX XXXX MIXED MARTIAL ARTS ACADEMY” including variants thereof. Apart
from its rights to use existing content from previous mixed martial
arts
bouts in which XX Xxxx appears, RWE has no rights to any likeness or
image
of XX Xxxx.
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