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EXHIBIT 10.8
LICENSE AGREEMENT
AGREEMENT, made this 31st day of March, 1996, between AUTOMATED GOLF
TRAINING AIDS, INC., a Florida corporation, hereinafter referred to as
"LICENSOR," and LEVEL BEST GOLF, INC., a Florida corporation, hereinafter
referred to as "LICENSEE."
W I T N E S S E T H:
WHEREAS, letters patent on United States Application Serial No.
60/004,073 for an ANGLE IRON AUTOMATED GOLF TRAINER, has been filed in the
United States Patent and Trademark Office on September 21, 1995;
WHEREAS, LICENSOR is the owner of a trademark "Angle Iron" used in
connection with the product of the invention embodied in U.S. Serial No.
60/004,073;
WHEREAS, the LICENSEE desires to manufacture, use, and sell structures
containing such patented improvement, hereinafter referred to as "The Product";
and,
WHEREAS, LICENSEE desires to obtain an exclusive license to
manufacture, use, and sell The Product, as hereinabove defined, and to use the
trademark "Angle Iron" and to have imparted to it the necessary technical
information to enable it to manufacture, use and sell The Product, as
hereinafter defined.
IT IS THEREFORE AGREED:
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1. The terms defined in Schedule A annexed hereto shall, for all
purposes of this Agreement, have the meanings in said Schedule A specified.
2. LICENSOR warrants that it is the owner of certain patent
rights and trademark rights relating to an ANGLE IRON AUTOMATED GOLF TRAINER
embodied in U.S. Patent Application No. 60/004,073, and that it has the right
to grant to LICENSEE the within license under the patent rights of LICENSOR.
3. (a) The LICENSOR hereby grants to the LICENSEE a
world-wide exclusive non-transferable right and license to manufacture, use,
and sell The Product, under the patent rights of LICENSOR including those
patent rights covered by U.S. Letters Patent Application No. 60/004,073 and
LICENSEE shall enjoy the use and application throughout the world of the
trademark Angle Iron."
(b) LICENSEE shall apply to The Product manufactured by
it under this license such notice of any licensed patent or patent application
as may be required by the laws of the United States or as may be required by
LICENSOR.
4. LICENSEE hereby grants to LICENSOR, a royalty-free, world-wide
exclusive license under the patent rights of LICENSEE to manufacture, use, and
sell The Product throughout the world subsequent to the termination of this
Agreement; such exclusive license includes the right by LICENSOR to grant,
either directly or through others, non-exclusive licenses under LICENSEE'S
patent rights to manufacture, use, and sell The Product.
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5. (a) The technical information of LICENSOR shall be
available to LICENSEE for the use of LICENSEE hereunder. LICENSEE will use its
best efforts to prevent duplication or disclosure of all such technical
information furnished directly or indirectly, in writing or otherwise, to
LICENSEE by LICENSOR, provided, however, that LICENSEE may furnish such
portions of such technical information, to the extent necessary for the
operations of LICENSEE hereunder, to others who have entered into an
appropriate agreement with LICENSOR for the protection of such technical
information. LICENSOR shall not be unreasonable with respect to the terms and
conditions of any such appropriate agreement or with respect to the approval or
selection of any party to said agreement.
(b) LICENSOR shall make periodic visits to LICENSEE's facilities
for the purpose of general consultation with LICENSEE and its staff and
employees for such problems as may arise in connection with the manufacture,
use and sale of The Product. More particularly, LICENSOR shall consult with
and provide such technical information and assistance with respect to any
warranty problems, manufacturing problems, quality control matters and with
respect to methods and processes of manufacture, marketing, distribution, and
sale of The Product.
(c) The technical information of LICENSEE shall be available to
LICENSOR. LICENSOR will use its best efforts to prevent duplication or
disclosure of all such technical information furnished directly or indirectly
in writing or
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otherwise, to LICENSOR by LICENSEE, except to the extent necessary in the
performance of LICENSOR's business.
(d) With respect to the obligations of the parties pertaining to
the protection and use of technical information furnished pursuant to this
paragraph 5, no obligation shall be imposed upon the recipient party with
respect to any portion of said information (i) which corresponds in substance
to that developed by and in the recipient party's possession prior to such
party's receipt of the same, (ii) which at the time of disclosure is, or
thereafter becomes, through no act or failure to act on the part of the
recipient party, part of the public domain by publication or otherwise, or
(iii) which corresponds in substance to information furnished to the recipient
party by others as a matter of right without restriction on disclosure;
provided, however, that the occurrence of (i), (ii), or (iii) above shall not
be construed as granting any rights, express or implied, under LICENSOR's
patents which relate to said information furnished to LICENSEE by LICENSOR,
except as otherwise specifically provided in paragraph 3 of this Agreement or
in any other license agreement between LICENSEE and LICENSOR. Technical
information disclosed under this Agreement shall not be deemed to be within the
foregoing exceptions merely because such information is embraced by more
general information in the public domain or in the recipient party's
possession. In addition, any combination of features shall not be deemed to be
within the foregoing exceptions merely because individual features are in
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the public domain or in the recipient party's possession, but only if the
combination itself and its principle of operation are in public domain or in
the recipient party's possession.
6. (a) LICENSOR shall use its best efforts to verify the
accuracy of the technical information furnished by it hereunder, but LICENSOR
shall not be liable for damages arising out of or resulting from anything made
available hereunder or the use thereof nor be liable to LICENSEE for any type
of damages, consequential or otherwise under any circumstances.
(b) The sole obligation of LICENSOR with respect to
technical information shall be to furnish it to LICENSEE. LICENSOR shall have
no responsibility for the ability of LICENSEE to use such technical information,
the quality or performance of The Product produced therefrom by LICENSEE, or the
claims of third parties arising from the use of such material or technical
information.
(c) LICENSEE agrees to assume all financial and service
obligations for The Product manufactured, used and sold by it hereunder, and
LICENSOR shall be absolved of all liability or responsibility to LICENSEE or
others for any failure in production, design, operation, or otherwise of The
Product manufactured, used and sold by LICENSEE, except as may have heretofore
been approved by LICENSOR.
(d) LICENSOR does not warrant and shall not be
responsible for any design, specification, drawing, blueprint, Xxx Xxxx, sepia,
or other reproducible tracing, or other data or
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information furnished by it to LICENSEE but shall furnish such in good faith to
the best of LICENSOR's knowledge and ability.
7. LICENSEE shall maintain high manufacturing standards for The
Product in order to ensure consumer acceptance and to ensure complete
interchangeability of parts for The Product and any proposed change involving
material alterations in the structure, quality, or design of The Product shall
be submitted to LICENSOR and shall be subject to its written approval prior to
making such alteration, which approval shall not be unreasonably withheld.
8. LICENSEE will pay royalties and render statements to LICENSOR
as set forth in Schedule B annexed hereto.
9. LICENSEE, in accordance with generally accepted accounting
practices, will keep such detailed records and books of account as shall be
necessary for the determination of royalties payable hereunder, and will
furnish copies thereof to LICENSOR at LICENSOR's request. LICENSOR or his
nominee may, at any time during business hours, make such examinations as it
may deem necessary to verify such records and books of account.
10. (a) LICENSEE will promptly advise LICENSOR in writing of
any notice or claim of infringement and of the commencement against it of any
suit or action for infringement of patents made or brought against LICENSEE and
based upon the use hereunder by LICENSEE of the rights granted to LICENSEE
hereunder with respect to The Product. If such use and The Product is in
accordance with designs and specifications approved by LICENSOR in writing,
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which approval will not be unreasonably withheld, LICENSOR will upon receipt of
such notice undertake the defense of any such suit or action to the extent that
the alleged infringement is based upon such use hereunder, but LICENSOR shall
have sole charge and direction of the defense of such suit or action. LICENSOR
and LICENSEE share equally in the cost of the defense of any such suit.
LICENSEE shall have the right to be represented therein by advisory counsel of
its own selection at its own expense.
(b) Except as otherwise may be provided herein, LICENSOR
will hold LICENSEE free and harmless from any damages or other sums that may be
assessed in or become payable under any final decree or final judgment by any
court for infringement to the extent based upon the use hereunder, during the
term of this agreement by LICENSEE of the LICENSOR technical information and
The Product in accordance with designs and specifications approved by LICENSOR
in writing, provided that the aggregate amount that may become payable by
LICENSOR under the provisions of this paragraph shall not in any event exceed
one-half (1/2) of the aggregate of the net royalty payments theretofore
received under this agreement by LICENSOR from LICENSEE in respect of The
Product in which such infringement shall have occurred. Except to the extent
expressly provided in this Article 8, LICENSOR shall not be obligated to pay
any losses, damages, claims or demands resulting from any such suit or action
or the conduct thereof or from any decree or judgment.
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(c) Neither LICENSOR nor LICENSEE shall settle or
compromise any such suit or action without the consent of the other if the
settlement or compromise obliges the other to make any payment or par with any
property or assume any obligation or grant any licenses or other rights or be
subject to any injunction by reason of such settlement or compromise.
11. (a) LICENSEE agrees to use its best efforts to promote
the sale of The Product throughout the world. As used in this Agreement, the
term "Best Efforts" refers to that level of efforts which the LICENSEE shall
exert which, in the LICENSEE's sole judgment, shall be best suited to
commercialize the licenses granted under this Agreement, taking into account
such factors as difficulties, time and expense encountered in development of
the market for The Product, cost factors derived at the completion of
development of each market segment, competitive and other market conditions.
Best efforts, as that term is contemplated in this Agreement, shall be assumed
to have been exerted in the event that the LICENSEE shall achieve the minimum
royalty levels contemplated in Schedule B hereof.
(b) LICENSEE shall as soon as possible after receiving
technical information as herein provided begin the manufacture and sale of The
Product herein licensed and shall throughout the life of this Agreement exert
its best efforts to create, supply and service throughout the world as
extensive a market for The Product as possible.
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12. (a) If LICENSEE shall delay, fail or refuse to make
payment of royalties or render statements to LICENSOR as provided in Paragraph
8 hereof, or if LICENSEE shall be in default for thirty (30) days in any other
obligation hereunder, LICENSOR may give written notice to LICENSEE specifying
the claimed particulars of such delay or default and, in the event LICENSEE
shall not remedy such delay or default within thirty (30) days after such
notice, LICENSOR may at its option take all of the following actions: terminate
this Agreement by giving ten (10) days' prior written notice to LICENSEE to
that effect, impose a finance charge of eighteen percent (18%) per annum for
the period of such delay, and/or proceed to enforce the defaulted obligation of
LICENSEE by any available means. Any indulgence on the part of LICENSOR in
respect to a delay or default by LICENSEE shall not be construed as a waiver of
LICENSOR's right to proceed under this paragraph either with respect to such
delay or default or to similar subsequent delays or defaults, nor shall this
Agreement be modified in any respect by any action of the parties or by
anything else other than the written concurrence of the parties hereto.
(b) Unless sooner terminated as herein provided, this
Agreement shall continue in full force and effect for five (5) years from the
date of this Agreement (hereinafter referred to as "Commencement Date"), and so
long as LICENSEE has achieved the minimum royalty levels contemplated in
Schedule B hereof, shall continue from year to year thereafter.
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(c) Upon termination of this Agreement, by expiration or
otherwise, all licenses, rights, privileges, and obligations hereunder shall
cease and terminate except that the licenses and rights granted under paragraph
3 hereof shall continue as to all specific units of The Product manufactured
during the term of this Agreement, or actually in manufacture upon the date of
termination of this Agreement, by LICENSEE or any of its subsidiaries, for the
full term of the patents under which The Product is licensed hereunder to be
made and/or used, sold, leased, or otherwise disposed of, and except that no
termination of this Agreement by expiration or otherwise shall release LICENSEE
from any of its obligations accrued hereunder (including its obligations to
furnish statements and to pay compensation with respect to The Product
manufactured during the term of this Agreement, or actually in manufacture upon
such date of termination by LICENSEE or any of its subsidiaries) or rescind or
give rise to any rights to rescind anything done or any payment made or other
consideration given to either party hereunder prior to the time such
termination becomes effective. In case of any such termination, LICENSOR shall
have the right to give public notice thereof in such manner and at such time
and places as it may deem advisable.
(d) On the termination of this Agreement, for any reason
whatsoever, LICENSEE shall deliver to LICENSOR all books, notes, drawings,
writings, and other documents, samples, and models relating to any improvements
or inventions which are the
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subject matter of this Agreement; and LICENSEE shall also cease to exploit any
patent right for which a license has been granted under this Agreement.
(e) In the event of the termination by LICENSOR pursuant
to the provisions of this Paragraph 12: (1) all unpaid sums on sales made prior
to the effective termination date shall become due and payable immediately; (2)
LICENSOR shall, if it so elects, have the right to purchase any or all of The
Product manufactured by LICENSEE which are unsold at the time of LICENSEE's
receipt of such notice of termination. The price to LICENSOR shall be the
LICENSEE's cost without any profit to LICENSEE. LICENSOR may also in such
event buy at depreciated costs, and without profit to the LICENSEE all special
dies, jigs, molds, tools, fixtures, and patterns applicable to The Product.
(f) From and after the effective date of any termination
of this Agreement, LICENSOR shall have no further rights hereunder except that
such termination shall not affect in any way the rights granted by LICENSEE
under paragraph 4 hereof, but LICENSEE shall not be relieved of any obligation
or liability accrued hereunder prior to the effective date of such termination.
(g) Termination of this Agreement shall not relieve
LICENSEE or LICENSOR of their respective obligations to prevent duplication or
disclosure of technical information furnished as provided in paragraph 5 hereof.
13. The addresses of the parties hereto are as follows:
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LICENSOR: AUTOMATED GOLF TRAINING AIDS, INC.
00000 Xxxxxxxxxxx Xxx
Xxxxx, XX 00000
LICENSEE: LEVEL BEST GOLF, INC.
00000 00xx Xxxxxx Xxxxx
Xx. Xxxxxxxxxx, XX 00000
Notices and written statements required hereunder shall be deemed to have been
duly given upon the mailing thereof, postpaid, to the party entitled thereto at
its above address or at such other address as may from time to time be
designated in writing to the other party.
14. "Angle Iron" is a proprietary name, and LICENSEE shall not
claim any rights or interests in the words "Angle Iron." LICENSEE shall make
no commercial use of the words "Angle Iron" except as otherwise provided
herein, as a trademark or otherwise, unless such commercial use and the manner
thereof has first been approved in writing by LICENSOR.
15. (a) This Agreement shall not be assignable by either
party without the prior written consent of the other party hereto, except that
it may be assigned without such consent to the successor of either party or to
a person, firm or corporation acquiring all of substantially all of the
business and assets of such party. No assignment of this Agreement shall be
valid until and unless this Agreement shall have been assumed by the assignee.
When duly assigned in accordance with the foregoing,
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this Agreement shall be binding upon and shall inure to the benefit of the
assignee.
(b) Any assignment of this Agreement shall provide that
neither LICENSEE nor LICENSOR shall be relieved of their respective obligations
with respect to the use, duplication or disclosure of technical information
furnished as provided in paragraph 5 hereof.
16. This Agreement is executed and delivered with the
understanding that it embodies the entire agreement between the parties and
that there are no prior representations, warranties or agreements relating
thereto.
17. This Agreement shall be construed and the legal relations
between the parties determined in accordance with the laws of the State of
Florida. In connection with any litigation including appellate proceedings
arising out of this Agreement, the prevailing party shall be entitled to
recover reasonable attorneys fees and costs.
18. This Agreement shall not become effective until executed by
LICENSOR at its principal office designated in paragraph 13 hereof. No change
in, addition to, or waiver of the terms and provisions hereof shall be binding
upon LICENSOR unless approved in writing by its authorized representative and
no modification shall be effected by the acknowledgment or acceptance of
purchase order forms containing other or different terms or conditions.
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19. Nothing contained herein shall be construed as granting any
rights, express or implied, under the patent rights or technical information of
LICENSOR, or as estopping LICENSOR from claiming infringement of the patent
rights or technical information of LICENSOR, in connection with any
manufacture, use, and sale by LICENSEE of The Product not conducted pursuant to
this license.
IN WITNESS WHEREOF, the parties hereto have caused their respective
corporate names to be hereto subscribed and their respective corporate seals to
be hereunto affixed and attested by their respective officers and agents
thereunto duly authorized.
Attest: /s/ ? LICENSOR:
AUTOMATED GOLF TRAINING AIDS, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
---------------------------------- ------------------------------------
(SEAL) its president
LICENSEE:
Attest: /s/ X.X. Xxxxxxx LEVEL BEST GOLF, INC.
By: /s/ Xxxx Xxxxxxx
---------------------------------- ------------------------------------
(SEAL) its president
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SCHEDULE A
DEFINITIONS
1. The term "patent rights" shall mean patents and patent
applications of all countries to the extent and only to the extent that they or
the claims thereof cover The Product (including, without limitation, apparatus
and equipment for carrying out manufacture and use of The Product), and
transferable interests in or rights with respect thereto, (i) acquired by the
party in question prior to the termination of this Agreement, or (ii) based on
inventions conceived and under the control of said party prior to the
termination of this Agreement; in each case to the extent that, and subject to
the conditions under which, said party now has or hereafter shall have the
right to grant licenses, immunities or licensing rights thereunder.
2. The term "technical information" shall mean detailed design
information relating to, improvements and developments relating to, and
operating technique necessary for the manufacture and use of The Product, or
any improvement thereof, made or acquired by the party in question prior to the
termination of this Agreement, to the extent that, and subject to the terms and
conditions (including the obligation to account to and/or make payments to
others) under which, said party has the right to disclose such information to
others. Such technical information may include drawings, manuals, blueprints,
design sheets, bills of materials, material specifications, photographs,
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package designs, photostats and similar data, and designs and specifications
relating to manufacturing equipment, tools, dies, molds, jigs, and fixtures,
and shall include the technical information in all current and future patent
applications relating to The Product.
3. The term "The Product" shall mean the devices, auxiliaries,
machinery, apparatus or replacement parts therefor, for structures containing
the improvements under LICENSOR's patent rights, including those embodied in
U.S. Patent Application No. 60/004,073 and commonly referred to as an ANGLE
IRON AUTOMATED GOLF TRAINING AID.
4. The term "United States" shall mean all territory to which
patents of the United States apply.
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SCHEDULE B
ROYALTIES
1. LICENSEE hereby accepts the license herein granted, subject to
all the conditions expressed elsewhere in this Agreement and in consideration
therefor agrees to pay LICENSOR in lawful money of the United States a royalty
of eight percent (8%) of LICENSEE's net sales actually received for The Product
sold by or for LICENSEE. Payments due LICENSOR hereunder shall be paid within
thirty (30) days after any quarterly period of each calendar year.
2. In consideration of the rights granted LICENSEE to said
trademarks, LICENSEE shall pay LICENSOR a royalty of one percent (1%) of
LICENSEE's net sales, as defined hereinbelow, of The Product and parts thereof
sold by or for LICENSEE and/or any sub-licensee.
3. For the calendar year ending December 31, 1996, there shall be
no minimum royalty. For the calendar year 1997, there shall be a minimum
royalty of $50,0000.00. The minimum royalty for the calendar year 1998 and
each year thereafter shall be $100,000.00.
4. LICENSEE will on or before the thirtieth day of each calendar
quarter, deliver to LICENSOR a written statement accounting for royalties so
payable or showing that no royalties are due, other than applicable minimum
royalty because no sales were made.
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5. Products in respect of which royalty is payable under
Paragraph 1 and 2 above shall be considered sold directly or indirectly, by
LICENSEE: (a) if sold on open account when delivered to a bona fide purchaser
for value or to a common carrier and consigned to such purchaser; (b) when paid
for, if paid in advance of delivery; and (c) if sold on consignment, when paid
for or when released from consignment, whichever shall first occur.
6. (a) The term "Net Sales" shall mean the proceeds actually
received by the LICENSEE during each calendar month during the term of this
Agreement, subject to payment or royalty under Paragraph 8 less the following:
(1) actual cost of freight charges or of freight
absorption, if any, separately stated in such invoice;
(2) actual cost of packaging and transit
insurance;
(3) trade, quantity or standard trade cash
discounts, if any, allowed;
(4) any tax, duties, imports or other government
charge on the sale, transportation, or delivery which is separately stated on
the invoice (unless in the nature of a value added tax, which need not be
separately stated);
(5) credit and cash refunds for returned goods;
and
(6) allowances for damaged, obsolete or defective
goods.
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(b) For purposes of computing royalty, as used in this
Agreement, the term "Units" shall mean that number of Units manufactured in the
license granted in paragraph 3(a) which Units have been theretofore sold in any
period and payment therefor actually received by the LICENSEE in the royalty
reporting period.
7. All royalty rates hereinabove specified refer to lawful money
of the United States of America. All royalty payments shall be made to
LICENSOR, at the office of LICENSOR designated in Article 13 hereof, in lawful
money of the United States of America and shall be made in an amount to be
calculated and established at the time payment is due so that, after deduction
for any taxes, assessments and charges levied, assessed or imposed, other than
by the Government of the United States of America, which LICENSEE or LICENSOR,
or any other party shall be required to pay or withhold in respect to this
Agreement or with respect to such royalty payments, the remainder actually
receivable by, and due and payable to, LICENSOR shall be in the amounts as
herein specified.
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