EXHIBIT 10.35
AGREEMENT
between
SPORTSPRIZE ENTERTAINMENT INC.
and
Big Game Xxxxx, Inc. f/s/o
Xxxxx Xxxxxx
This Services and Promotional Agreement ("Agreement") is entered into by
and between SportsPrize Entertainment Inc., ("SportsPrize"), producer of the
XxxxxxXxxxx.xxx Web site, and a Nevada C corporation with its principal place of
business at 00000 Xxxxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxx Xxxxxxx, Xxxxxxxxxx
00000, and Big Game Xxxxx, Inc. for the services of Xxxxx Xxxxxx (collectively
"Worthy"), an American citizen with his principal place of business at 00000
Xxxxxx Xxxxxx, Xxxxx 000, Xxx Xxxxxxx, Xxxxxxxxxx 00000. The Parties have
entered into this Agreement effective March 1, 2000.
WHEREAS SportsPrize desires to obtain the right to use the name, likeness,
image, photograph, signature, voice, endorsement and similar right of publicity
for Worthy for use on its Web site, in personal appearances by Worthy in
connection with the marketing and promotion of the SportsPrize Web site and its
proprietary Sports Tournament, an interactive game appearing on the SportsPrize
Web site for sports enthusiasts, on terms set forth in this Agreement.
SportsPrize further desires for Worthy to serve as a member of its Sports
Advisory Board, which shall include Worthy and other sports personalities who
perform services and promote SportsPrize in a manner similar to that described
below, on terms set forth herein;
WHEREAS Worthy is willing to xxxxx the right to use his name, likeness,
image, photograph, signature, voice, endorsement and similar right of publicity
for SportsPrize's Web site, in personal appearances by Worthy in connection with
the marketing and promotion of the SportsPrize Web site and its proprietary
Sports Tournament on terms set forth herein. Worthy
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further is willing to serve as a member of SportsPrize's Sports Advisory Board
on terms set forth herein; and
NOW THEREFORE, in consideration of the mutual covenants and conditions
contained herein, and for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
X. Xxxxx
A. Subject to the terms, conditions and obligations of this Agreement,
Worthy hereby grants to SportsPrize a non-exclusive worldwide right to use,
market, promote and advertise his name, likeness, image, photograph, signature,
voice, endorsement and similar right of publicity for SportsPrize, its Web site
and merchandise bearing the SportsPrize logo ("the Product") for a period of one
(1) year from date hereof, which rights shall include, but not be limited to,
use in magazines, newspapers, trade journals, banners, coupons, in-store
displays, point-of-sale displays, posters, product inserts, circulars, outdoor
advertising, editorials, public relations materials, all electronic media
including, but not limited to, the Internet or global network, television and
radio, and any other print materials in connection with the Product. Only
SportsPrize has the authority to sell these items, no rights are granted to
third parties. Worthy retains all rights not conveyed herein.
B. Worthy shall have the right to approve photograph(s), likeness(es),
image(s) and script(s) only insofar as the selected materials reflect upon
Worthy personally. Worthy's disapproval must be provided in writing within five
(5) days after Worthy's receipt of photograph(s), likeness(es), image(s) or
script(s). If written disapproval is not received by SportsPrize within five (5)
days, the photograph(s), likeness(es), image(s) and/or script(s) shall be deemed
approved. Approval shall not be unreasonably withheld.
II. Territory
SportsPrize shall be entitled to use, market, promote, and advertise the
name, likeness, image, photograph, signature, voice, endorsement, and similar
right of publicity of Worthy worldwide in accordance with the preceding granting
clause and this Agreement.
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III. Term
The term of this Agreement will be twelve (12) months and shall commence on
March 1, 2000 and shall end on February 28, 2001 ("Initial Term").
IV. Option Term
A. Provided SportsPrize is not in breach, the parties agree that,
SportsPrize has the option, at its sole discretion, to extend the term of this
Agreement for a one-year (1 year) period ("Option Year") provided that
SportsPrize provides Worthy with written notification executing its option at
least thirty (30) days prior to the end of the Initial Term; and
B. Except as otherwise stated herein, SportsPrize shall have the right, at
its sole discretion, to require Worthy to render any and all of the same
services in the Option Year under the same terms and conditions as the Initial
Term and SportsPrize shall have the right to continue to use any and all
materials previously produced hereunder in the Option Year all subject to the
terms herein.
V. Services
A. Worthy agrees that he will be available at a future date and time to be
designated by SportsPrize and Worthy for one audio recording session for
SportsPrize's radio advertising in which to produce a number of radio
commercials to be mutually determined by Worthy and SportsPrize and subject to
availability. This recording session will last no longer than two (2) hours. The
audio recording session is expected to take place sometime in March or April
2000 in the Los Angeles Area.
B. Worthy will be available for and participate in two pre-arranged
appearances during the Initial Term as part of the "Prizes Money Can't Buy"
Program. The first of these two appearances has tentatively been planned as a
meeting in April 2000 with Worthy for the winner of the "Win a Trip to the NCAA
Final Four Sweepstakes" contest. The appearances will include at most a four (4)
hour session with Worthy, the winner, and one (1) of the winner's friends.
Worthy agrees that he will be available at a future date and time to be
designated by SportsPrize and with ten (10) days written notice to Worthy.
SportsPrize shall pay for the reasonable travel expenses of Worthy, including
first class air travel, hotel accommodations, and meals unless
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such expenses are already being paid for by another party, and, with Worthy's
cooperation, make the travel arrangements for the appearances.
C. Worthy will attend one (1) press conference to announce Worthy's
relationship with SportsPrize and his membership on the Sports Advisory Board.
The press conference may include other members of the Sports Advisory Board. The
press conference will last no longer than sixty (60) minutes and SportsPrize
will give Worthy twenty (20) days written notice of the conference. Such
conference shall be held at a place to be determined by SportsPrize.
D. Subject to availability, Worthy agrees that he will be available at a
future date and time to be designated by SportsPrize upon ten (10) days written
notice for four (4) on-line chats for the SportsPrize Web site of no more than
four (4) hours for promoting an upcoming major basketball event (including, but
not limited to National Basketball Association Playoffs and National Collegiate
Athletics Association Final Four); on-line chats may be done from Worthy's home
or business or at a location designated by Worthy and SportsPrize with the
assistance of a typist hired by SportsPrize. Worthy will also assist in creating
listings of Worthy's top ten basketball memories (including, but not limited to,
"Worthy's Best" and "Worthy's Worst") for the SportsPrize Web site. These two
content pieces will be written by SportsPrize or its agents with guidance and
assistance from Worthy.
E. Within thirty (30) days of a written request by SportsPrize for Worthy's
autograph, Worthy will autograph one hundred (100) pieces of Product to be used
as prizes or promotions for the SportsPrize Tournament.
F. Worthy will act in good faith, whenever possible, to promote the
SportsPrize brand and shall at all times act in a manner appropriate to his
position as a spokesperson and endorser for a product of the highest quality and
reputation such as SportsPrize. Worthy shall not engage in conduct that reflects
unfavorably upon the good name, good will or image of SportsPrize.
G. Worthy will use good faith efforts to assist in the signing of
additional members to either sit on the Sports Advisory Board. Worthy will also
assist in securing other sports personalities at a fair market rate to
participate in "Prizes Money Can't Buy" Program. Worthy will assist in the
introduction of groups and/or organizations who may have an interest in
associating with SportsPrize.
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H. Worthy agrees that during the Term of the Agreement, including any
option, renewal or extension of the Term, and for a period of six (6) months
after the expiration or termination of this Agreement he will not endorse,
sponsor, or otherwise serve as a spokesperson for any other sports and
entertainment Web site that directly competes with the SportsPrize business
model, which includes sports trivia and performance prediction tournaments, nor
grant any party the right to use, market, promote or advertise the name,
likeness, image, photograph, signature, voice, endorsement, or similar rights of
publicity of Worthy for any other sports and entertainment Web site that
directly competes with the SportsPrize business model. Worthy can be involved in
sports and entertainment Web sites that do not directly compete with the
SportsPrize business model.
VI. Nature of the Services
A. It is expressly understood and agreed that the services to be performed
by Worthy and the rights and privileges granted SportsPrize impart certain
obligations and duties of both parties to the public and the trade in connection
with the publication of any and all endorsement materials;
B. It is further expressly understood and agreed that the services to be
performed by Worthy and the rights and privileges granted to SportsPrize
hereunder are special, unique, extraordinary and impossible of replacement,
which gives them peculiar value, the loss of which could not be reasonably or
adequately compensated in damages in an action at law, and that Worthy's failure
or refusal to perform Worthy's obligations hereunder would cause SportsPrize to
suffer irreplaceable loss and damage. Accordingly, should Worthy fail or refuse
to perform such services, SportsPrize shall be entitled to seek ex parte
injunctive or other equitable relief against Worthy to prevent the continuance
of such failure or refusal or to prevent Worthy from performing services for, or
granting rights to others, in violation of this Agreement including but not
limited to the provisions of paragraph V.H. Neither the right to resort to
injunctive or other equitable relief, nor the exercise of such right, shall
constitute a waiver of any other or additional rights at law or pursuant to the
terms of such right, shall constitute a waiver of any other or additional rights
at law or pursuant to the terms of this Agreement which SportsPrize may have
against Worthy as a result of such failure or refusal. This provision is
excluded from any requirement to arbitrate under paragraph XV.
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VII. Compensation
A. For the above services, Worthy will be compensated as follows:
1. SportsPrize shall grant to Worthy stock options to acquire up to
Sixty Thousand (60,000) shares of SportsPrize common stock at $0.01 per
share (the "Stock Options"), pursuant to a stock option agreement in
substantially the form attached hereto as Exhibit "A" (the "Stock Option
Agreement"). Of the 60,000 Stock Options which Worthy will acquire herein,
Worthy agrees that he is receiving 5,000 Stock Options for each of two
appearances he will make during the Initial Term in the "Prizes Money Can't
Buy Program." In the event the 5,000 Stock Options acquired by Worthy in
consideration for his appearance are not worth the equivalent of $10,000
cash on the date of the appearance, SportsPrize will pay Worthy the
difference in cash between the value of the Stock Options and $10,000. Such
payment will be made within thirty (30) days of Worthy's appearance. Such
Stock Options shall vest immediately upon execution and delivery of the
Stock Option Agreement and become immediately exercisable. The Stock
Options and the common stock (the Stock Options, the Appearance Options (as
defined below), the Additional Options (as defined below), and common stock
issuable upon exercise shall be referred to herein collectively as the
"Securities") acquirable upon exercise of the Stock Options shall be issued
pursuant to either: (i) an exemption from registration under state and
federal securities laws or (ii) the registration of the Stock Option
Agreement on Form S-8 under the Securities Act, as amended (the "Securities
Act").
2. A commission equal to three percent (3%) of the face value of
consideration paid in cash during the Term to or by any corporate sponsor
that Worthy has facilitated by way of the initial referral to SportsPrize
and has participated in the development of the relationship, payable ten
(10) business days from the date when payment is received or paid by
SportsPrize from or to the referral;
3. Twelve (12) SportsPrize logo polo shirts, deliverable within thirty
(30) days of execution of this Agreement;
4. Twelve (12) SportsPrize logo baseball caps, deliverable within
thirty (30) days of execution of this Agreement; and
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5. Reimbursement for all reasonable expenses and costs incurred
directly in connection with these services, payable within thirty (30) days
of receipt by SportsPrize of request for reimbursement.
B. Investment Representation
1. Worthy represents and warrants that Worthy is a:
a. A natural person whose individual net worth, or joint net
worth with that person's spouse, at the time of this
purchase exceeds US$1,000,000; and/or
b. A natural person who had an individual income in excess of
US$200,000 in each of the two most recent years or joint
income with that person's spouse in excess of US$300,000 in
each of those years and has a reasonable expectation of
reaching the same income level in the current year; and/or
c. An entity in which all of the equity owners are accredited
investors.
2. a. Worthy represents and warrants that he is acquiring the
Securities solely for Worthy's own account for investment and not
with a view to or for sale or distribution of the Securities,
including the common stock issuable upon exercise of the Stock
Options, the Appearance Options, or the Additional Options or any
portion thereof and without any present intention of selling,
offering to sell or otherwise disposing of or distributing such
Securities or any portion thereof in any transaction other than a
transaction complying with the registration requirements of the
Securities Act, and applicable state Securities or "blue sky"
laws, or pursuant to an exemption therefrom. Worthy also
represents that the entire legal and beneficial interest of the
common shares that he is acquiring is being acquired for, and
will be held for, Worthy's account only, and neither in whole nor
in part for any other person or entity.
b. Worthy acknowledges that the Securities are being granted
or issued as compensation for services and that such compensation
may be subject to state and federal taxation. Worthy acknowledges
that any taxes related to the issuance of the Securities are the
sole and exclusive responsibility of the Worthy. Worthy
acknowledges that SportsPrize has advised Worthy to seek separate
legal and tax
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counsel in connection with the negotiation, execution and
delivery of this Agreement.
3. Worthy acknowledges that SportsPrize has made available
any and all documents related to SportsPrize that Worthy has
requested, and Worthy acknowledges that he has received all such
information as Worthy deems necessary and appropriate to enable
him to evaluate the financial risk inherent in making an
investment in the Securities (the "Disclosure Documents") and the
documents and materials submitted therewith, which include a
description of the risks inherent in an investment in
SportsPrize. Worthy further acknowledges that Worthy has received
satisfactory and complete information concerning the business and
financial condition of SportsPrize in response to all inquiries
in respect thereof.
4. Worthy represents and warrants as follows:
a. Worthy realizes that Worthy's acquisition of the
Securities involves a high degree of risk and will be a
highly speculative investment, and that he or it is able,
without impairing Worthy's financial condition, to hold the
Securities for an indefinite period of time.
b. Worthy has carefully considered and has, to the
extent Worthy believes such discussion necessary, discussed
with Worthy's professional legal, tax and financial advisors
the suitability of an investment in SportsPrize for the
particular tax and financial situation of Worthy and that
Worthy and/or Worthy's advisors have determined that the
Securities are a suitable investment for Worthy.
c. The financial condition and investment of Worthy are
such that he, she or it is in a financial position to hold
the Securities for an indefinite period of time and to bear
the economic risk of, and withstand a complete loss of, the
consideration given.
d. Worthy alone, or with the assistance of professional
advisors, has such knowledge and experience in financial and
business matters that the undersigned is capable of
evaluating the merits and risks of Worthy's purchase of the
Securities, or has a pre-existing personal or business
relationship with SportsPrize or any of its officers,
directors, or controlling persons of a duration and nature
that enables the undersigned to be aware of the character,
business acumen
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and general business and financial circumstances of
SportsPrize or such other person.
e. Worthy has carefully read the Disclosure Documents
and the documents and materials submitted therewith, and
SportsPrize has made available to Worthy or Worthy's
advisors all information and documents requested by Worthy
relating to investment in the Securities, and has provided
answers to Worthy's satisfaction to all of Worthy's
questions concerning SportsPrize.
f. Although SportsPrize intends to file a registration
on Form S-8 to register the Stock Option Agreement under the
Securities Act, Worthy understands that neither SportsPrize
nor any of its officers or directors has any obligation to
register the Securities under any federal or state
securities act or law.
g. Worthy has relied solely upon the Disclosure
Documents and the documents and materials submitted
therewith, advice of his or its representatives, if any, and
independent investigations made by Worthy and/or his or its
representatives, if any, in making the decision to purchase
the Securities subscribed for herein and acknowledges that
no representations or agreements other than those set forth
in the Disclosure Documents have been made to Worthy in
respect thereto.
h. All information which Worthy has provided concerning
Worthy himself is correct and complete as of the date set
forth below, and if there should be any material change in
such information prior to the acceptance of the Securities,
he will immediately provide such information to SportsPrize.
i. Worthy confirms that Worthy has received no general
solicitation or general advertisement and has attended no
seminar or meeting (whose attendees have been invited by any
general solicitation or general advertisement) and has
received no advertisement in any newspaper, magazine, or
similar media, broadcast on television or radio regarding
the offering of the Securities.
5. Worthy acknowledges that SportsPrize has hereby disclosed to
Worthy in writing:
a. The Securities that Worthy is acquiring have not
been registered under the Securities Act, or the securities
laws of any state of the United States, and such Securities
must be held indefinitely unless a transfer of them is
subsequently
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registered under the Securities Act or an exemption from
such registration is available; and
b. SportsPrize will make a notation in its records of
the above described restrictions on transfer and of the
legend described below.
6. Worthy agrees that all of the Securities shall have endorsed
thereon a legend to the following effect:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER
UNITED STATES FEDERAL OR STATE SECURITIES LAWS AND MAY NOT BE OFFERED
FOR SALE, SOLD OR OTHERWISE TRANSFERRED OR ASSIGNED FOR VALUE,
DIRECTLY OR INDIRECTLY, NOR MAY THE SECURITIES BE TRANSFERRED ON THE
BOOKS OF THE CORPORATION, WITHOUT REGISTRATION OF SUCH SECURITIES
UNDER ALL APPLICABLE UNITED STATES FEDERAL OR STATE SECURITIES LAWS OR
COMPLIANCE WITH AN APPLICABLE EXEMPTION THEREFROM, SUCH COMPLIANCE, AT
THE OPTION OF THE CORPORATION, TO BE EVIDENCED BY AN OPINION OF
SHAREHOLDER'S COUNSEL, IN FORM ACCEPTABLE TO THE CORPORATION, THAT NO
VIOLATION OF SUCH REGISTRATION PROVISIONS WOULD RESULT FROM ANY
PROPOSED TRANSFER OR ASSIGNMENT."
C. For any appearances beyond the two (2) appearances for the "Prizes Money
Can't Buy" Program set forth herein and performed in the Initial Term, as
specified in paragraph V.B., SportsPrize shall pay Worthy ten thousand dollars
($10,000), within thirty (30) days after the appearance(s).
D. In the event that SportsPrize exercises the Option Term, Worthy will be
compensated as follows for such Option Term: SportsPrize shall grant to Worthy
stock options exercisable to acquire up to fifty thousand (50,000) shares of
SportsPrize common stock at $0.01 per share (the "Additional Options"), pursuant
to a stock option agreement in substantially the form of the stock option
agreement attached hereto as "Exhibit B" (the "Additional Option Agreement").
The Additional Options shall vest and become immediately exercisable upon the
execution and delivery of the Additional Option Agreement, which the parties
agree shall occur upon the commencement of the Option Term. The Additional
Options and the common stock acquirable upon the exercise of the Additional
Options shall be issued pursuant to either: (i) an exemption from registration
under state and federal securities laws or (ii) the registration of the
Additional Option Agreement on Form S-8 of the Securities Act. Except as
otherwise provided
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in this Agreement, Worthy shall not be entitled to any additional compensation
from SportsPrize during the Option Term.
E. In the event that SportsPrize does not elect to retain Worthy's services
during the Option Term, Worthy will receive no additional compensation.
VIII. Representations and Warranties
A. Worthy warrants and represents that:
(i) he has the full right and legal authority to enter into this
Agreement, to grant the rights set forth hereinabove, and to the best of
his knowledge to fully perform in accordance with its terms and that in so
doing he will not be in violation of any agreement, understanding or
obligation to which he is or previously was a party or in violation of the
rights of any third party;
(ii) there are no contractual obligations preventing the fulfillment
of this Agreement, or materially impairing or diminishing the value of the
rights granted hereunder;
(iii) he will not make any agreements, commitments or arrangements
whatsoever with any person or entity that may, in any manner or to any
extent, affect the rights of SportsPrize under this Agreement; and
(iv) in performing his responsibilities under this Agreement, Worthy
will comply with all laws and regulations that may concern or relate to
such performance.
B. SportsPrize warrants and represents that it has the right to enter into
this Agreement and to grant the rights as set forth hereinabove. SportsPrize
will comply with all applicable laws and is a corporation in good standing.
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IX. Mutual Indemnification
A. Worthy agrees to indemnify and hold SportsPrize and its officers,
employees, agents, directors, shareholders and assigns harmless from and against
any and all losses, costs, damages, charges, claims, legal fees, recoveries,
judgments, penalties and/or reasonable expenses which may be obtained against,
imposed upon, or suffered by SportsPrize by reason of any breach of any
representation, warranties or agreements made by Worthy under this Agreement or
by virtue of any act committed by Worthy.
B. SportsPrize will indemnify and hold Worthy and Big Game Xxxxx, Inc. (and
its officers, employees, and agents) harmless from and against any and all
losses, costs, damages, charges, claims, legal fees, recoveries, judgments,
penalties and/or reasonable expenses which may be obtained against, imposed
upon, or suffered by Worthy, Big Game Xxxxx, Inc. or its officers, employees or
agents by reason of any use or content of the advertising materials produced
hereunder or the Product advertised therein or the services of Worthy or by
reason of SportsPrize's general operation. During the Initial Term and any
extension thereof of this Agreement, SportsPrize shall include Worthy as an
additional named insured under SportsPrize's product and general liability
insurance policies and shall provide Worthy with certificates evidencing such
coverage. SportsPrize will maintain $10 million of general liability insurance.
X. Termination
A. SportsPrize, without prejudice to any other right or remedy available to
it, shall have the right to terminate this Agreement upon ten (10) days written
notice if SportsPrize becomes aware that Worthy fails, refuses, neglects or is
unable to render material services as contemplated hereunder because of any act
which brings him into public disrepute, scandal or ridicule, or shocks or
offends the community, or derogates from the public image or reflects
unfavorably upon SportsPrize or any of its products or services including but
not limited to making unfavorable statements about SportsPrize or being charged
with a felony or other serious crime, willful refusal, failure to cooperate with
SportsPrize, mental disability, impairment, illness, including, but not limited
to, any substantial facial, or bodily disfigurement or change which in
SportsPrize's sole judgment materially interferes with the ability to perform
properly the services required hereunder unless Worthy shall completely remedy
the violation within ten (10) days to the satisfaction of SportsPrize. In the
event that SportsPrize, at its sole discretion,
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terminates this Agreement, the compensation to Worthy shall be reduced pro rata
in proportion to (i) the services rendered, if any, and (ii) the period of use,
marketing, promotion or advertisement of the Product, if any, by SportsPrize and
will be paid to SportsPrize in an amount equal to the greater of the pro rata
fair market value (as quoted on the National Association of Securities Dealers
Over-The-Counter Bulletin Board ("NASD OTCBB")), or any other national stock
exchange that the Company's stock is subsequently listed on, of the shares of
Common Stock issued pursuant to the Stock Options, Appearance Options or the
Additional Options, if any, (i) at the date of grant or (ii) at the date of
termination notice.
B. Worthy may terminate this Agreement immediately with written notice to
SportsPrize and without any further obligations (as of the date of termination)
in any of the following situations:
1. In the event SportsPrize is adjudicated as insolvent, declares
bankruptcy, or fails to continue its business.
2. In the event SportsPrize is late in the delivery of any of Worthy's
payments, whether stock options or money and fails to make payment within five
(5) business days of receipt of Worthy's written request for such payment.
C. Upon termination or expiration of this Agreement, all rights herein
granted to SportsPrize shall revert to Worthy. SportsPrize may not use Worthy's
name, image, likeness, photograph or similar right of publicity after the
termination or expiration of this Agreement.
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XI. Consent in the Event of Death
The parties agree that, in the event of Worthy's death during the Agreement
term, any renewals or extensions thereof, SportsPrize shall have the option to
continue marketing the Product utilizing Worthy's name, likeness, photograph,
voice, image, endorsement, or similar right of publicity in connection
therewith, for the duration of the Agreement term, any renewals or extensions
thereof, under the same terms and conditions as set forth in this Agreement. In
the event that SportsPrize shall instead elect to terminate such marketing, the
compensation to Worthy shall be reduced pro rata in proportion to (i) the
services rendered up to the date of death, if any, and (ii) the period of use,
marketing, promotion or advertisement of the Product, if any, by SportsPrize
SportsPrize and will be paid to SportsPrize in an amount equal to the greater of
the pro rata fair market value (as quoted on the NASD OTCBB), or any other
national stock exchange that the Company's stock is subsequently listed on, of
the shares of Common Stock issued pursuant to the Stock Options, Appearance
Options or the Additional Options, if any, (i) at the date of grant or (ii) at
the date of termination notice.
XII. Severability
The findings, declaration, decision, or determination by any judicial or
administrative authority that any term, provision, right or obligation of this
Agreement is void or unenforceable shall not operate or be construed to
invalidate or nullify the remaining terms, provisions, rights or obligations
contained in this Agreement, which terms, provisions, rights or obligations
shall continue to remain in full force and effect, unless SportsPrize, in its
discretion, decides that such findings, declaration, decision, or determination
adversely affects the original intent of the parties, in which event SportsPrize
shall have the right to terminate this Agreement upon thirty (30) days written
notice to Worthy.
XIII. Force Majeure
Neither party will be deemed in default of this Agreement to the extent
that performance of their respective obligations or attempts to cure any breach
are delayed or prevented by reason of any act of God, fire, natural disaster,
accident, act of government, war, shortages of materials or supplies, or any
other cause beyond the reasonable control of either party; provided, that either
gives the other party written notice thereof within thirty (30) working days of
discovery thereof.
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In the event of such a Force Majeure, the time for performance or cure will be
extended for a period equal to the duration of the Force Majeure but not in
excess of six (6) months.
XIV. Governing Law
This Agreement shall be governed by the laws of the State of California,
without regard to its conflict of laws rules, and the parties, thus, agree to
submit to the jurisdiction of the California courts for resolution of any
disputes arising at any time relating to this Agreement.
XV. Arbitration
Except as noted above in paragraph VI, any and all differences and disputes
between the parties arising out of or under, or related to, this Agreement shall
be resolved in arbitration before the American Arbitration Association ("AAA")
and in accordance with its Commercial Rules. Any such arbitration proceeding
shall take place in Los Angeles, California before a single arbitrator appointed
by the AAA. All arbitration awards shall be final and binding upon the parties.
XVI. Successors and Assigns
The terms and conditions of this Agreement are binding upon the parties
hereto, their successors, heirs, executors, administrators, affiliates and
assignees, except that Worthy's grant, services, and performance obligations are
neither assignable or transferable.
XVII. Construction
Headings of the paragraphs herein are for convenience of reference only and
are without substantive significance.
XVIII. Complete Agreement
This Agreement constitutes the entire agreement between the parties
relating to the subject matter hereof, supersedes all prior agreements relating
to the subject matter, and may be amended or terminated only by written
instrument signed by both parties.
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XIX. Ownership
The Product and any and all marketing, promotional or advertising materials
in any form produced hereunder will be and remain the absolute property of
SportsPrize forever, including but not limited to, any all intellectual property
including or encompassing copyrights, trademarks, service marks, designs,
images, photographs, depictions, pictures, patents, trade secrets, among any and
all other proprietary rights, and the parties recognize, acknowledge and agree
that Worthy has no right, title or interest in or to any or all of these
aforementioned materials, and hereby assigns and transfers ownership of any and
all rights or claims in connection with these materials to SportsPrize.
Notwithstanding the foregoing, Worthy will retain the copyright ownership in the
content pieces referred to in paragraph V.D. and SportsPrize will retain the
right to publish these content pieces during the Initial Term and any extension
thereof of this Agreement.
XX. Confidentiality
A. The parties recognize and acknowledge that the terms and provisions of
this Agreement, and any disputes arising thereunder, are confidential in nature
and, therefore, agree not to disclose the content or substance thereof to any
third parties other than counsel and accountants and as may be reasonably
required in order to comply with any obligations imposed by the Agreement, or to
comply with any statute, ordinance, rule, regulation, or other law or court
order.
B. Worthy shall keep confidential all information supplied by SportsPrize
to him in connection with his rendering of services to SportsPrize. Worthy shall
not disclose or disseminate any of such information without SportsPrize's prior
written approval.
16
XXI. Notices
All notices to be sent pursuant to the terms of this Agreement shall be
given by certified or registered mail, postage prepaid, to the addresses
indicated below unless the parties hereinafter so notify each other in writing
of different addresses. In addition, delivery by facsimile transmission will be
permissible, with notice effective as of the date of the transmission, so long
as a copy of such transmission is also promptly sent by first class mail.
If to SportsPrize: SportsPrize Entertainment, Inc.
00000 Xxxxxxxxxx Xxxxxxxxx,
Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: President
Fax: (000) 000-0000
If to Worthy: Big Game Xxxxx, Inc.
Xxxxx Xxxxxx
00000 Xxxxxx Xxxxxx,
Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
XXII. Relationship of the Parties
This Agreement does not create a partnership or joint venture between the
parties, and Worthy is neither an employee nor agent of SportsPrize, and as an
independent contractor, shall have no power to obligate or bind SportsPrize in
any manner. Worthy has no right to use any SportsPrize trademarks or
intellectual property rights except in connection with performance under this
agreement.
XXIII. Non - Waiver
Any failure or delay by a party in the exercise of any of its rights under
this Agreement shall not be construed as a waiver of such rights, nor shall any
such failure or delay preclude the exercise of such rights at any later time.
17
IN WITNESS WHEREOF, the parties have executed this Agreement by their duly
authorized representatives on the dates indicated below.
SportsPrize Entertainment Inc. Big Game Xxxxx, Inc.
Xxxxx Xxxxxx
By: /s/ Xxxxx X. Xxxxxxx By: /s/ Xxxxx Xxxxxx
----------------------------- --------------------------------
Xxxxx X. Xxxxxxx Xxxxx Xxxxxx
Its: President and Chief
Financial Officer
Date: March 8, 2000 Date: March 2, 2000
18
Exhibit A
SPORTSPRIZE ENTERTAINMENT INC.
STOCK OPTION AGREEMENT
THIS AGREEMENT is entered into effective as of the 1st day of March, 2000
("Date of Grant") between SPORTSPRIZE ENTERTAINMENT INC., a Nevada corporation
(the "Company"), and Big Game Xxxxx, Inc. f/s/o Xxxxx Xxxxxx (the "Optionee").
WHEREAS, the Board of Directors of the Company (the "Board") has authorized
and approved a services and promotional agreement by and between the Company and
the Optionee effective as of March 1, 2000 (the "Services Agreement"), pursuant
to which the Board is authorized to grant to Optionee stock options to purchase
up to Sixty Thousand (60,000) shares of common stock of the Company (the "Common
Stock");
WHEREAS, the Optionee has agreed to provide the Company with certain
services in consideration of the options granted under this agreement;
WHEREAS, the certain shareholders of the Company have agreed to pool shares
of their common stock and agreed to make such shares available to certain
service providers for the benefit of the Company, as authorized by the Board;
WHEREAS, the pooling shareholders have contributed Sixty Thousand (60,000)
shares of common stock to the Company pursuant to the terms of a contribution
agreement for the purposes of granting the option to the Optionee;
WHEREAS, the Board has determined that it is in the best interest of the
Company to grant to Optionee options to purchase a total of up to Sixty Thousand
(60,000) shares of Common Stock (the "Options"), which Options are intended not
to be incentive stock options within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code");
NOW, THEREFORE, the Company agrees to offer to the Optionee the option to
purchase, upon the terms and conditions set forth herein, Sixty Thousand
(60,000) shares of Common Stock. Capitalized terms not otherwise defined herein
shall have the meanings ascribed thereto in the Services Agreement.
1. Exercise Price. The options shall be exercisable at $0.01 per share.
2. Limitation on the Number of Shares. The number of shares, which may be
acquired upon exercise thereof is subject to the limitations set forth in this
Agreement and the Services Agreement.
-1-
3. Vesting Schedule. The Options may be exercised immediately upon
execution and delivery of this Agreement.
4. Options not Transferable. This Option may not be transferred, assigned,
pledged or hypothecated in any manner (whether by operation of law or otherwise)
other than by will, by applicable laws of descent and distribution or pursuant
to a qualified domestic relations order, and shall not be subject to execution,
attachment or similar process; provided, however, such Option is transferable
without payment of consideration to immediate family members of the Optionee or
to trusts or partnerships established exclusively for the benefit of the
Optionee and the Optionee's immediate family members. Upon any attempt to
transfer, pledge, hypothecate or otherwise dispose of any Option or of any right
or privilege conferred by this Agreement contrary to the provisions thereof, or
upon the sale, levy or attachment or similar process upon the rights and
privileges conferred by this Agreement or the Services Agreement, such Option
shall thereupon terminate and become null and void.
5. Investment Intent. By accepting the option, the Optionee represents and
agrees that none of the shares of Common Stock purchased upon exercise of the
Option will be distributed in violation of applicable federal and state laws and
regulations. In addition, the Company may require, as a condition of exercising
the Options, that the Optionee execute an undertaking, in such a form as the
Company shall reasonably specify, that the Stock is being purchased only for
investment and without any then-present intention to sell or distribute such
shares.
6. Termination of Service Agreement and Options. Vested Options shall
terminate, to the extent not previously exercised, upon the occurrence of the
first of the following events:
(i) Expiration: Two years from the vesting date of such options;
(ii) Termination for Cause: The date of the Company's termination of the
contractual relationship with Optionee pursuant to section X.A. of the
Services Agreement.
(iii) Termination Due to Death or Disability: The expiration of one (1)
year from the date of the death of the Optionee or cessation of an
Optionee's contractual relationship by reason of disability (as defined in
the Services Agreement). If an Optionee's contractual relationship is
terminated by death, any Option held by the Optionee shall be exercisable
only by the person or persons to whom such Optionee's rights under such
Option shall pass by the Optionee's will or by the laws of descent and
distribution.
(iv) Termination for Any Other Reason: The expiration of ninety (90) days
from the date of an Optionee's termination of contractual relationship with
the Company for any reason whatsoever other than cause, death or disability
(as defined in the Services Agreement).
-2-
7. Stock. In the case of any stock split, stock dividend or like change in
the nature of shares of Stock covered by this Agreement, the number of shares
and exercise price shall be proportionately adjusted.
8. Exercise of Option. Options shall be exercisable, in full or in part, at
any time after vesting, until termination; provided, however, that any Optionee
who is subject to the reporting and liability provisions of Section 16 of the
Securities Exchange Act of 1934 with respect to the Common Stock shall be
precluded from selling or transferring any Common Stock or other security
underlying an Option during the six (6) months immediately following the grant
of that Option. If less than all of the shares included in the vested portion of
any Option are purchased, the remainder may be purchased at any subsequent time
prior to the expiration of the Option term. No portion of any Option for less
than one hundred (100) shares (as adjusted) may be exercised; provided, that if
the vested portion of any Option is less than one hundred (100) shares, it may
be exercised with respect to all shares for which it is vested. Only whole
shares may be issued pursuant to an Option, and to the extent that an Option
covers less than one (1) share, it is unexercisable.
Each exercise of the Option shall be by means of delivery of a notice of
election to exercise (which may be in the form attached hereto as Exhibit A) to
the Secretary of the Company at its principal executive office, specifying the
number of shares of Common Stock to be purchased and accompanied by payment in
cash by certified check or cashier's check in the amount of the full exercise
price for the Common Stock to be purchased.
9. Professional Advice. The acceptance of the Options and the sale of
Common Stock issued pursuant to the exercise of Options may have consequences
under federal and state tax and securities laws, which may vary depending upon
the individual circumstances of the Optionee. Accordingly, the Optionee
acknowledges that he or she has been advised to consult his or her personal
legal and tax advisor in connection with this Agreement and his or her dealings
with respect to Options for the Common Stock.
10. No Employment Relationship. Except as otherwise provided in the Service
Agreement, the grant of an Option shall in no way constitute any form of
agreement or understanding binding on the Company, express or implied, that the
Company will contract with, or otherwise employ, the Optionee for any length of
time, nor shall it interfere in any way with the Company's right to terminate
Optionee's contractual relationship at any time, which right is hereby reserved.
11. Entire Agreement. This Agreement and the Service Agreement is the only
agreement between the Optionee, and the Company with respect to the Options, and
this Agreement and the Service Agreement supersede all prior and contemporaneous
oral and written statements and representations and contain the entire agreement
between the parties with respect to the Options.
-3-
12. Notices. Any notice required or permitted to be made or given hereunder
shall be mailed or delivered personally to the addresses set forth below, or as
changed from time to time by written notice to the other:
The Company: SportsPrize Entertainment Inc.
00000 Xxxxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: President
The Optionee: Big Game Xxxxx, Inc.
Xxxxx Xxxxxx
00000 Xxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Dated this 8th day of March, 2000.
SPORTSPRIZE ENTERTAINMENT INC.
By: /s/ Xxxxx X. Xxxxxxx
----------------------------------
Xxxxx X. Xxxxxxx
Its: President and Chief Financial Officer
BIG GAME XXXXX, INC. F/S/O XXXXX XXXXXX
/s/ Xxxxx Xxxxxx
--------------------------------------
Xxxxx Xxxxxx
-4-
THERE MAY NOT BE PRESENTLY AVAILABLE EXEMPTIONS FROM THE REGISTRATION
REQUIREMENTS OF APPLICABLE FEDERAL AND STATE SECURITIES LAWS FOR THE ISSUANCE OF
SHARES OF STOCK UPON EXERCISE OF THESE OPTIONS. ACCORDINGLY, THESE OPTIONS
CANNOT BE EXERCISED UNLESS THESE OPTIONS AND THE SHARES OF STOCK TO BE ISSUED
UPON EXERCISE OF THESE OPTIONS ARE REGISTERED OR AN EXEMPTION FROM SUCH
REGISTRATION REQUIREMENTS IS AVAILABLE.
THE SHARES OF STOCK ISSUED PURSUANT TO THE EXERCISE OF OPTIONS WILL BE
"RESTRICTED SECURITIES" AS DEFINED IN RULE 144 UNDER THE SECURITIES ACT OF 1933
AND WILL BEAR A LEGEND RESTRICTING RESALE UNLESS THEY ARE REGISTERED UNDER STATE
AND FEDERAL SECURITIES LAWS OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE. THE
COMPANY IS NOT OBLIGATED TO REGISTER THE SHARES OF STOCK OR TO MAKE AVAILABLE
ANY EXEMPTION FROM REGISTRATION.
-5-
EXHIBIT "A" to Stock Option Agreement
Notice of Election to Exercise
This Notice of Election to Exercise shall constitute proper notice pursuant
to Section 8 of that certain Stock Option Agreement (the "Agreement") dated as
of the ____ day of _____________, 2000 between SportsPrize Entertainment Inc.
(the "Company") and the undersigned.
The undersigned hereby elects to exercise Optionee's option to purchase
__________ shares of the common stock of the Company at a price of $__________
per share, for aggregate consideration of $______, on the terms and conditions
set forth in the Agreement. Such aggregate consideration, in the form specified
in Section 8 of the Agreement, accompanies this notice.
The undersigned has executed this Notice this ____ day of __________, 200_.
---------------------------------------------
Signature
---------------------------------------------
Name (typed or printed)
-6-
Exhibit B
SPORTSPRIZE ENTERTAINMENT INC.
ADDITIONAL OPTION AGREEMENT
THIS AGREEMENT is entered into as of the ____ day of February, 2001 ("Date
of Grant") between SPORTSPRIZE ENTERTAINMENT INC., a Nevada corporation (the
"Company"), and Big Game Xxxxx, Inc. f/s/o Xxxxx Xxxxxx (the "Optionee").
WHEREAS, the Company has entered into a services and promotional agreement
with the Optionee effective as of March 1, 2000 (the "Services Agreement"),
pursuant to which the Company has agreed to grant to Optionee stock options to
purchase up to Fifty Thousand (50,000) shares of common stock of the Company
(the "Common Stock") under an option term of two years;
WHEREAS, the Company provided the Optionee with notice to extend the
agreement for the option term and the Optionee has agreed to provide the Company
with certain services in consideration of the options granted under this
agreement;
WHEREAS, the Board of Directors of the Company (the "Board") has determined
that it is in the best interest of the Company to grant to Optionee options to
purchase a total of up to Fifty Thousand (50,000) shares of Common Stock (the
"Options"), which Options are intended not to be incentive stock options within
the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code");
NOW, THEREFORE, the Company agrees to offer to the Optionee the option to
purchase, upon the terms and conditions set forth herein, Fifty Thousand
(50,000) shares of Common Stock. Capitalized terms not otherwise defined herein
shall have the meanings ascribed thereto in the Services Agreement.
1. Exercise Price. The options shall be exercisable at $0.01 per share.
2. Limitation on the Number of Shares. The number of shares, which may be
acquired upon exercise thereof is subject to the limitations set forth in this
Agreement and the Services Agreement.
3. Vesting Schedule. The Options may be exercised immediately upon
execution and delivery of this Agreement.
4. Options not Transferable. This Option may not be transferred, assigned,
pledged or hypothecated in any manner (whether by operation of law or otherwise)
other than by will, by applicable laws of descent and distribution or pursuant
to a qualified domestic relations order, and shall not be subject to execution,
attachment or similar process; provided, however, such Option is transferable
without payment of consideration to immediate family members of the Optionee or
to trusts or partnerships established exclusively for the benefit of the
Optionee
-1-
and the Optionee's immediate family members. Upon any attempt to transfer,
pledge, hypothecate or otherwise dispose of any Option or of any right or
privilege conferred by this Agreement contrary to the provisions thereof, or
upon the sale, levy or attachment or similar process upon the rights and
privileges conferred by this Agreement or the Services Agreement, such Option
shall thereupon terminate and become null and void.
5. Investment Intent. By accepting the option, the Optionee represents and
agrees that none of the shares of Common Stock purchased upon exercise of the
Option will be distributed in violation of applicable federal and state laws and
regulations. In addition, the Company may require, as a condition of exercising
the Options, that the Optionee execute an undertaking, in such a form as the
Company shall reasonably specify, that the Stock is being purchased only for
investment and without any then-present intention to sell or distribute such
shares.
6. Termination of Service Agreement and Options. Vested Options shall
terminate, to the extent not previously exercised, upon the occurrence of the
first of the following events:
(i) Expiration: Two years from the vesting date of such options;
(ii) Termination for Cause: The date of the Company's termination of the
contractual relationship with Optionee pursuant to section X.A. of the
Services Agreement.
(iii) Termination Due to Death or Disability: The expiration of one (1)
year from the date of the death of the Optionee or cessation of an
Optionee's contractual relationship by reason of disability (as defined in
the Services Agreement). If an Optionee's contractual relationship is
terminated by death, any Option held by the Optionee shall be exercisable
only by the person or persons to whom such Optionee's rights under such
Option shall pass by the Optionee's will or by the laws of descent and
distribution.
(iv) Termination for Any Other Reason: The expiration of ninety (90) days
from the date of an Optionee's termination of contractual relationship with
the Company for any reason whatsoever other than cause, death or disability
(as defined in the Services Agreement).
7. Stock. In the case of any stock split, stock dividend or like change in
the nature of shares of Stock covered by this Agreement, the number of shares
and exercise price shall be proportionately adjusted.
8. Exercise of Option. Options shall be exercisable, in full or in part, at
any time after vesting, until termination; provided, however, that any Optionee
who is subject to the reporting and liability provisions of Section 16 of the
Securities Exchange Act of 1934 with respect to the Common Stock shall be
precluded from selling or transferring any Common Stock or other security
underlying an Option during the six (6) months immediately following the grant
-2-
of that Option. If less than all of the shares included in the vested portion of
any Option are purchased, the remainder may be purchased at any subsequent time
prior to the expiration of the Option term. No portion of any Option for less
than one hundred (100) shares (as adjusted) may be exercised; provided, that if
the vested portion of any Option is less than one hundred (100) shares, it may
be exercised with respect to all shares for which it is vested. Only whole
shares may be issued pursuant to an Option, and to the extent that an Option
covers less than one (1) share, it is unexercisable.
Each exercise of the Option shall be by means of delivery of a notice of
election to exercise (which may be in the form attached hereto as Exhibit A) to
the Secretary of the Company at its principal executive office, specifying the
number of shares of Common Stock to be purchased and accompanied by payment in
cash by certified check or cashier's check in the amount of the full exercise
price for the Common Stock to be purchased.
9. Professional Advice. The acceptance of the Options and the sale of
Common Stock issued pursuant to the exercise of Options may have consequences
under federal and state tax and securities laws, which may vary depending upon
the individual circumstances of the Optionee. Accordingly, the Optionee
acknowledges that he or she has been advised to consult his or her personal
legal and tax advisor in connection with this Agreement and his or her dealings
with respect to Options for the Common Stock.
10. No Employment Relationship. Except as otherwise provided in the Service
Agreement, the grant of an Option shall in no way constitute any form of
agreement or understanding binding on the Company, express or implied, that the
Company will contract with, or otherwise employ, the Optionee for any length of
time, nor shall it interfere in any way with the Company's right to terminate
Optionee's contractual relationship at any time, which right is hereby reserved.
11. Entire Agreement. This Agreement and the Service Agreement is the only
agreement between the Optionee, and the Company with respect to the Options, and
this Agreement and the Service Agreement supersede all prior and contemporaneous
oral and written statements and representations and contain the entire agreement
between the parties with respect to the Options.
12. Notices. Any notice required or permitted to be made or given hereunder
shall be mailed or delivered personally to the addresses set forth below, or as
changed from time to time by written notice to the other:
The Company: SportsPrize Entertainment Inc.
00000 Xxxxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: President
-3-
The Optionee: Big Game Xxxxx, Inc.
Xxxxx Xxxxxx
00000 Xxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Dated this ___ day of February, 2001.
SPORTSPRIZE ENTERTAINMENT INC.
By: ----------------------------------
Xxxxx X. Xxxxxxx
Its: President and Chief Financial Officer
BIG GAME XXXXX, INC. F/S/O XXXXX XXXXXX
--------------------------------------
Xxxxx Xxxxxx
-4-
THERE MAY NOT BE PRESENTLY AVAILABLE EXEMPTIONS FROM THE REGISTRATION
REQUIREMENTS OF APPLICABLE FEDERAL AND STATE SECURITIES LAWS FOR THE ISSUANCE OF
SHARES OF STOCK UPON EXERCISE OF THESE OPTIONS. ACCORDINGLY, THESE OPTIONS
CANNOT BE EXERCISED UNLESS THESE OPTIONS AND THE SHARES OF STOCK TO BE ISSUED
UPON EXERCISE OF THESE OPTIONS ARE REGISTERED OR AN EXEMPTION FROM SUCH
REGISTRATION REQUIREMENTS IS AVAILABLE.
THE SHARES OF STOCK ISSUED PURSUANT TO THE EXERCISE OF OPTIONS WILL BE
"RESTRICTED SECURITIES" AS DEFINED IN RULE 144 UNDER THE SECURITIES ACT OF 1933
AND WILL BEAR A LEGEND RESTRICTING RESALE UNLESS THEY ARE REGISTERED UNDER STATE
AND FEDERAL SECURITIES LAWS OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE. THE
COMPANY IS NOT OBLIGATED TO REGISTER THE SHARES OF STOCK OR TO MAKE AVAILABLE
ANY EXEMPTION FROM REGISTRATION.
-5-
EXHIBIT "A" to Additional Option Agreement
Notice of Election to Exercise
This Notice of Election to Exercise shall constitute proper notice pursuant
to Section 8 of that certain Additional Option Agreement (the "Agreement") dated
as of the ____ day of _____________, 2001 between SportsPrize Entertainment Inc.
(the "Company") and the undersigned.
The undersigned hereby elects to exercise Optionee's option to purchase
__________ shares of the common stock of the Company at a price of $__________
per share, for aggregate consideration of $______, on the terms and conditions
set forth in the Agreement. Such aggregate consideration, in the form specified
in Section 8 of the Agreement, accompanies this notice.
The undersigned has executed this Notice this ____ day of __________, 200_.
---------------------------------------------
Signature
---------------------------------------------
Name (typed or printed)
