EXCLUSIVE LICENSE AND MARKETING SERVICES AGREEMENT
EXCLUSIVE LICENSE AND MARKETING SERVICES AGREEMENT
THIS EXCLUSIVE LICENSE AND MARKETING SERVICES
AGREEMENT (this "Agreement") is effective as of November 18, 2003 ("Effective
Date"), by and between SAN DIEGO SOCCER DEVELOPMENT CORPORATION, a publicly
traded Nevada corporation, doing business as "SOCCER DEVELOPMENT OF AMERICA"
(the "Licensee"), and, LATIN AMERICAN FUTBOL CORPORATION, a Florida corporation
("LAFC"), and LAFC's wholly-owned subsidiary, Golo Lotto, a corporation
registered in the Netherlands Antilles (individually referred to herein as "GL"
and together with LAFC, referred to herein as the "Licensor"). Licensee and
Licensor are sometimes referred to collectively herein as the "Parties", and
each individually as a "Party."
RECITALS
WHEREAS, LAFC is the owner of
GL, including the "Golo Lotto" brand name, logo, and the website located at
xxx.xxxxxxxxx.xxx, including all content therein (collectively, the "GL
Assets"); and
WHEREAS, on or about February 7, 2003, LAFC and Licensee
entered into that certain Golo Lotto Asset Purchase Agreement (the "Purchase
Agreement"), pursuant to which Licensee agreed to purchase a Fifty-One Percent
(51.0%) interest in and to the GL Assets according to the terms and conditions
set forth in the Purchase Agreement; and
WHEREAS, the Parties have determined that it is in the best
interest of all of the Parties to terminate the Purchase Agreement and to enter
into an exclusive licensing arrangement whereby Licensee will use the GL Assets
to perform certain marketing services on behalf of Licensor according to the
terms of a formal license agreement.
NOW, THEREFORE, in consideration of the foregoing premises,
the mutual promises contained herein, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Parties hereto
agree as follows:
SECTION 1. LICENSE
1.1 Delivery of GL Assets. Licensor shall deliver to Licensee
copies of all GL Assets in both hard copy and electronic format, as may be
requested by Licensee, for use as contemplated in this Agreement.
1.2 Grant of License. Licensor hereby grants to Licensee an
exclusive worldwide right and license to use, reproduce, distribute copies, and
create derivative works from the GL Assets for the purpose of enabling Licensee
to perform the Marketing Services (as defined below) (the "License").
1.3 Territory Restriction. Notwithstanding the grant of a
"worldwide" License hereunder, the GL Assets shall not be used by either
Licensee, Licensor, or any of their respective agents, representatives,
affiliates, successors, or permitted assigns in any manner whatsoever to perform
Marketing Services in connection with any of the GL Assets to any Person
residing in the United States or any territory of the United States.
Additionally, neither Licensee nor Licensor shall use the GL Assets in any
manner whatsoever to perform Marketing Services to any Person residing in any
country where online gaming is or becomes illegal. Licensor shall conduct
periodic reviews of local laws and regulations in countries in which Marketing
Services are provided. If Marketing Services are being provided in any country
in which online gaming is or becomes illegal, such Marketing Services shall be
ceased immediately. Licensee shall not be required to perform Marketing Services
in any country until Licensor has provided Licensee with satisfactory evidence
that online gaming is permissible in such country. For purposes of this
Agreement, the term "Person" shall mean any individual, corporation,
partnership, association, trust, limited liability company or other legal entity
formed under the laws of the United States or any of its constituent States or
territories, or any partnership, joint venture or other combination of any of
the foregoing.
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SECTION 2. SERVICES
2.1 Services. Licensee shall use the GL Assets to perform the
marketing services described in Exhibit A (the "Marketing Services"), which is
attached to this Agreement.
2.2 Control; Manner of Performance of Services. Licensee may
control and direct the means, manner and method by which the Marketing Services
required by this Agreement will be performed; provided however, Licensor has and
shall retain exclusive control over the operations of GL, and Licensor shall be
entitled to exercise general power of supervision and control over the results
of work performed by Licensee to assure satisfactory performance, including the
right to inspect, the right to stop work, the right to make suggestions or
recommendations as to the details of the work, and the right to propose
modifications to the work.
2.3 No Web-Hosting Services. The Parties expressly
acknowledge that the Marketing Services do not, and are not intended to, include
or constitute web hosting services. Licensee does not intend to, and shall not,
provide web-hosting services in connection with the GL website.
2.4 No Operational Control. The Parties expressly acknowledge
that Licensor has, and shall at all times during the term of the Agreement have,
exclusive control over the operations of GL. The Parties further expressly
acknowledge that Licensee does not have, and shall not have, any control with
respect to the operations of GL.
SECTION 3. CONSIDERATION, EXPENSES AND MATERIALS
3.1 Consideration. In consideration of the License granted
herein, Licensee shall deliver to Licensor:
(a) License Fee. A single non-refundable lump sum payment of
Forty-Seven Thousand & NO/100 Dollars ($47,000) in United States currency (the
"License Fee"), payable upon execution and delivery of this Agreement;
(b) Revenue Based Fees. An amount equal to Fifty Percent
(50%) of the monthly net revenues generated from the use of the GL Assets (the
"Revenue Fees"), shall be payable to Licensee within thirty (30) days of receipt
by Licensor of such revenues. The Revenue Fees shall be net of all Expenses (as
defined in Section 3.2 below); and
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(c) Common Stock of SDA. A stock certificate issued to "Latin
America Futbol Corporation" evidencing One Million Five Hundred Thousand
(1,500,000) shares of SDA restricted common stock (the "SDA Stock"); provided
however, that the SDA Stock shall be subject to restrictions applicable to
unregistered shares provided by the Securities Act of 1933 and shall bear a
legend substantially similar to the following:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 (THE "ACT") OR APPROVED BY THE SECURITIES AND EXCHANGE
COMMISSION OR ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE. THE SHARES
REPRESENTED BY THIS CERTIFICATE CANNOT BE SOLD, TRANSFERRED OR OTHERWISE
DISPOSED OF TO ANY PERSON OR ENTITY UNLESS SUBSEQUENTLY REGISTERED UNDER THE
ACT, AS AMENDED, OR UNLESS AN EXEMPTION FROM REGISTRATION APPLIES, AS DETERMINED
BY COMPANY COUNSEL.
(d) Acknowledgment of Receipt. Licensor hereby expressly
acknowledges that Licensee has delivered to Licensor the complete License Fee,
and the SDA Stock.
3.2 Expenses. Unless specifically agreed upon in writing,
Licensee shall be responsible for all expenses incurred while performing
Marketing Services under this Agreement. However, Licensor shall reimburse
Licensee for (i) all pre-approved reasonable travel and living expenses
necessarily incurred by Licensee while away from Licensee's regular place of
business to perform Marketing Services under this Agreement, and (ii) all
pre-approved percentages paid to back-end providers, clubs, federations,
players, etc. for joining the GL program. Licensee shall submit an itemized
statement or invoice of such expenses. Licensor shall pay such expenses directly
to the third party vendors of services or products upon receipt of a written
invoice or other statement of the services rendered to Licensee or the products
purchased by Licensee. Licensor shall pay all such invoices promptly upon
receipt, but in no event later than the earlier of (a) thirty (30) days from the
date of the specific invoice, or (b) the due date of the specific invoice.
3.3 Materials. Except for the GL Assets, which shall be
provided by Licensor, Licensee shall furnish all materials, equipment and
supplies used to provide the Marketing Services required by this Agreement.
3.4 Audit Rights. Upon Licensee's request, at mutually
agreeable times no more frequently than on a quarterly basis, Licensee or an
agent or accounting firm chosen by Licensee shall be provided reasonable access
during normal business hours to the records of Licensor for purposes of auditing
the Revenue Fees due. Records sufficient to verify the revenue received shall be
maintained by Licensor and made available for audit. Persons conducting the
audit shall be provided a reasonable opportunity to interview customers of
Licensor and any employees of Licensor who have engaged in the development
and/or marketing of the services generated by Licensee in order to corroborate
the information contained in such records.
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SECTION 4. TERM AND TERMINATION
4.1 Term of Agreement. This Agreement will become effective
when signed by all Parties and shall remain in effect until terminated by either
Party as provided below.
4.2 Termination for Cause. Either Party may terminate this
Agreement for cause at any time by giving ninety (90) days prior written notice
of termination. Licensor shall be entitled to full payment of all Revenue Fees
derived from revenues generated prior to the effective date of termination and
received within ninety (90) days after the effective date of termination. For
purposes of this Agreement, the term "cause" shall mean (i) failure on the part
of Licensor to perform any of its obligations under this Agreement, (ii) the
breach of any Party's representations or warranties made under this Agreement,
or (ii) the failure by Licensee to perform the Marketing Services for any
continuous period of at least sixty (60) days without valid business-related
justification (i.e. off season period, failure by Licensor to deliver GL Assets
or otherwise cooperate with Licensee, etc.); provided however, that no breach
shall be construed as "cause" for termination unless such breach remains uncured
for a period of thirty (30) days following notice of breach by the non-breaching
party delivered to the breaching party.
SECTION 5. OWNERSHIP RIGHTS
5.1 Intellectual Property Ownership. Licensor warrants that
it is the exclusive owner of all rights in and title to the GL Assets, and that
it has all rights necessary for the grant of the right and license granted by
this Agreement. It is the intention of the Parties hereto that all rights,
including without limitation copyright, in any derivative works of the GL Assets
created by Licensee (the "Derivative Works") shall remain the exclusive property
of Licensor; provided however, that all such Derivative Works shall immediately
and automatically become part of the GL Assets and be subject to the terms and
conditions of this Agreement.
5.2 Licensee Intellectual Property. The Parties acknowledge
that from time to time, Licensee may add to the GL Assets certain trademarks,
logos or other intellectual property that is the exclusive property of Licensee
("Licensee IP"). To the extent that any Derivative Works contain any Licensee
IP, such Licensee IP shall remain the exclusive property of Licensee; provided
however, Licensee hereby grants a non-exclusive royalty-free license to Licensor
to use such Licensee IP solely in connection with the Derivative Works for a
period of time that is equal to the term of this Agreement.
SECTION 6. CONFIDENTIALITY
6.1 For purposes of this Agreement "Proprietary Information"
shall mean any information relating to the business of the Licensor or any
entity in which Licensor has a controlling interest and shall include (but shall
not be limited to) information encompassed in all drawings, designs, programs,
plans, formulas, proposals, marketing and sales plans, financial information,
costs, pricing information, customer information, and all methods, concepts or
ideas in or reasonably related to the business of Licensor.
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6.2 During the term of this
Agreement, Licensee shall use reasonable care to prevent the unauthorized use or
dissemination of Licensor's Proprietary Information. Reasonable care means at
least the same degree of care Licensee uses to protect its own confidential
information from unauthorized disclosure.
6.3 The term "Proprietary Information" shall not include
information that (i) has been disclosed in publicly available sources of
information, (ii) is, through no fault of the Licensee, hereafter disclosed in
publicly available sources of information, (iii) is now in the possession of
Licensee without any obligation of confidentiality, or (iv) has been or is
hereafter lawfully disclosed to Licensee by any third party, but only to the
extent that the use or disclosure thereof has been or is rightfully authorized
by that third party.
SECTION 7. LICENSOR OBLIGATIONS AND WARRANTIES
7.1 Joint and Several Obligations. All representations,
warranties, covenants and obligations of "Licensor" hereunder are and shall be
joint and several representations, warranties, covenants and obligations of LAFC
and GL.
7.2 No Unauthorized Gaming. Licensor warrants that it shall
use its best efforts to ensure that it does not accept any online bets or
otherwise engage in online gaming with any Person who resides in the United
States, any territory of the United States, or any other country in which online
gaming is prohibited by law.
7.3 Cooperation. Licensor shall use its best efforts to
deliver to Licensee such documents, materials, information and assistance as may
be reasonably requested by Licensee in order for Licensee to fulfill its
obligations under this Agreement.
7.4 Authority. Licensor warrants that it has obtained the
requisite corporate authority to enter into this Agreement and to perform its
obligations hereunder. Licensor further warrants that each of GL and LAFC are
entities validly formed and existing in good standing under the laws of the
Netherlands Antilles and Florida, respectively.
7.5 No Interference. Licensor warrants that its performance
under this Agreement, and the Marketing Services to be performed by Licensee,
shall not violate any of Licensor's obligations under any other contract or
agreement with any third party.
7.6 No Violation of Law; Litigation. Licensor's performance
under this Agreement does not and shall not violate any applicable law, rule, or
regulation; or any third party rights in any patent, trademark, copyright, trade
secret, or similar right. Licensor further represents and warrants that there is
no pending litigation or other claims that would prevent, hinder or otherwise
interfere with Licensor entering into this Agreement or performing its
obligations hereunder.
SECTION 8. LICENSEE WARRANTIES
8.1 Authority. Licensee has obtained the requisite corporate
authority to enter into this Agreement and to perform the Marketing Services.
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8.2 No Violation of Law. Licensee's performance of the
Marketing Services called for by this Agreement do not and shall not violate any
applicable law, rule, or regulation; any contracts with third parties; or any
third party rights in any patent, trademark, copyright, trade secret, or similar
right.
SECTION 9. LIMITATION OF LIABILITY; INDEMNIFICATION
9.1 Force Majeure. Licensee shall not be liable to Licensor
for any failure or delay caused by events beyond Licensee's control, including,
without limitation, Licensee's failure to furnish necessary information,
sabotage, failure or delays in transportation or communication, acts of God,
failures or substitutions of equipment, labor disputes, accidents, shortages of
labor, fuel, raw materials or equipment, or technical failures.
9.2 Indemnity. Each of the Parties (each, an "Indemnifying
Party") shall indemnify the other Parties (each, an "Indemnified Party"), their
respective directors, officers, stockholders, agents, employees and other legal
representatives from and against all claims, liabilities, losses, damages,
expenses and costs, including reasonable attorney fees, joint or several,
arising out of or in connection with the Indemnifying Party's performance under
this Agreement, or the breach of any representation or warranty made by the
Indemnifying Party herein. In the case of any such claims, the Indemnified Party
shall promptly notify the Indemnifying Party in writing of such claim or suit
and the Indemnified Party shall have the right to fully control the defense and
any settlement of the claim or suit.
SECTION 10. MISCELLANEOUS
10.1 Governing Law. This Agreement shall be governed and
construed in all respects in accordance with the laws of the State of California
as they apply to a contract entered into and performed in that State.
10.2 Successors and Assigns. This Agreement may not be
assigned by either Party, except with the prior written consent of the other
Party. This Agreement shall be binding upon and against the Parties hereto and
their heirs, officers, directors or other legal representatives, administrators,
successors and permitted assigns.
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10.3 Waivers. No waiver of any breach, default or provision
hereunder shall be construed to be a valid waiver of such provision unless in a
writing signed by the waiving Party, and no such waiver shall be deemed a
continuing waiver of any subsequent breach or default hereunder unless expressly
stated as such in a signed writing.
10.4 Injunctive Relief. Each of the Parties hereto (each, an
"Injuring Party") acknowledges that the injury to other Parties (each an
"Injured Party") resulting from any violation by it of any of the covenants
contained in this Agreement will be of such a character that it cannot be
adequately compensated by money damages, and, accordingly, the Injured Party
may, in addition to pursuing its other remedies, obtain an injunction from any
court having jurisdiction of the matter restraining any such violation; and no
bond or other security shall be required in connection with such injunction.
10.5 Independent Contractors. The Parties are and shall be
independent contractors to one another, and nothing herein shall be deemed to
cause this Agreement to create an agency, partnership, or joint venture between
the Parties. Nothing in this Agreement shall be interpreted or construed as
creating or establishing the relationship of employer and employee between
Licensor and either Licensee or any employee or agent of Licensee.
10.6 Notices. All notices required or permitted hereunder
shall be in writing addressed to the respective Parties as set forth below,
unless another address shall have been designated, and shall be delivered by
hand or by registered or certified mail, postage prepaid.
If to Licensee: San Diego Soccer Development Corporation
0000 Xxxxxxx Xxxx., Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
Attn: Xxx Xxxxxx, President & CEO
If to LAFC: Latin America Futbol Corporation
00000 Xxxxxxxx Xxxx., Xxxxx 000
Xxxxx, Xxxxxxx 00000
Attn: Xxxxx Xxxxx, President
If to GL: c/o Latin America Futbol Corporation
00000 Xxxxxxxx Xxxx., Xxxxx 000
Xxxxx, Xxxxxxx 00000
Attn: Xxxxx Xxxxx, President
10.7 Entire Agreement. This
Agreement, including the exhibits hereto, constitutes the entire agreement of
the Parties hereto and supersedes all prior agreements, representations,
proposals, discussions, and communications, whether oral or in writing,
including without limitation the Purchase Agreement. This Agreement may be
modified only in writing and shall be enforceable in accordance with its terms
when signed by the party sought to be bound.
10.8 Neutral Construction. The Parties hereto agree that this
Agreement was negotiated fairly between them at arms' length and that the final
terms of this Agreement are the product of the Parties' negotiations. Each Party
represents and warrants that it has sought and received legal counsel of its own
choosing with regard to the contents of this Agreement and the rights and
obligations affected hereby. The Parties agree that this Agreement shall be
deemed to have been jointly and equally drafted by them, and that the provisions
of this Agreement therefore should not be construed against any of the Parties
on the grounds that a Party drafted or was more responsible for drafting the
provision(s) hereof.
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10.9 Counterparts. This
Agreement may be executed in multiple counterparts, each of which is an
original, but all of which, taken together, constitute a single document.
10.10 Survival. Sections 5, 6, 7, 8 and 9 (inclusive) of this
Agreement shall survive completion of the Marketing Services or the termination
of this Agreement.
10.11 Parties in Interest. This Agreement is enforceable only
by Licensee and Licensor. The terms of this Agreement are not a contract or
assurance regarding compensation, continued employment or benefit of any kind to
any personnel assigned to Licensee's work, or any beneficiary of any such
personnel, and no such personnel (or any beneficiary thereof) shall be a
third-party beneficiary under or pursuant to the terms of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their duly authorized representatives, on the date and year first above written.
| "Licensee": SAN DIEGO SOCCER DEVELOPMENT CORPORATION., a Nevada corporation |
"Licensor": LATIN AMERICAN FUTBOL CORPORATION, a Florida corporation |
|
| /s/ Xxx Xxxxxx | /s/ Xxxxx Xxxxx | |
| Signature | Signature | |
| Name: Xxx Xxxxxx Title: President & CEO Date: November 18, 2003 |
Name: Xxxxx Xxxxx Title: President Date: November 18, 2003 |
|
| and | ||
| GOLO LOTTO, a corporation registered in the Netherlands Antilles | ||
| /s/ Xxxxx Xxxxx | ||
| Name: Xxxxx Xxxxx Title: President Date: November 18, 2003 |
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Exhibit A
MARKETING SERVICES
Subject to the terms and conditions of the Exclusive Marketing Services License
Agreement (the "Agreement"), Licensee has the exclusive right and license to
use, reproduce, distribute copies, and create derivative works from the GL
Assets in furtherance of Licensee's performance of the following services:
I. Marketing Services.
Licensee shall market the GL Assets with top professional teams and federations
to include marketing rights such as stadium boards, naming rights for
tournaments, clothing sponsorships and links on official pages, among others.
Licensee shall seek affiliations with such groups to try to implement marketing
rights to fully exploit Golo Lotto in Latin America. Some of the rights Licensee
will work to obtain include the following:
- Standard billboards in the center of the field
or on the line between the goal and the corner point with the Golo Lotto name
in all the stadiums where the teams or leagues plays.
- Placement of the Golo Lotto logo in magazines
and any programs or other print media.
- Advertising on or in tickets and programs.
- The right to include the Golo Lotto logo on
the outside of all stadiums where the league plays, including exposure of the
brand in front of the main stadium entrances, exits, signals, service areas,
parking areas, and inside all of the stadiums, with the understanding that it
will be Golo Lotto itself which will design and install these sign elements,
in locations it chooses.
- The right to have up to six sales points or
stands for the Golo Lotto product inside all of the stadiums where the league
plays, including the right to place the Golo Lotto logo on one or more of the
following, if permitted: shirts, shorts, socks, track suits or pants of all
the potential domestic clubs and leagues.
- The rights to place the Golo Lotto logo on the surfaces of the official balls of the league for play during tournaments sponsored by Golo Lotto.
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- The right to place links to the Golo Lotto
website on all of the official team and federation websites, as permitted by
applicable law, including the logo and information about the company; provided
however, that no links shall be placed to websites hosted in the United
States, any territory of the United States, or any country in which online
gaming is illegal.
- The use of all club images to advertise on
magazines, television commercials, newspapers, etc. to promote the lottery.
- Free television advertising space as part of
the agreement between teams and leagues and the television stations with which
they contract (since these groups own the television rights, they will be in a
bargaining position to request advertising space for Golo Lotto), including a
one-minute space appearing twenty minutes before game time pertaining to the
placement of bets on the game.
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