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EXHIBIT 10.19
WSE LICENSE AGREEMENT
This Agreement (this "AGREEMENT") is made and entered into as of the
1st day of November, 1997 by and between World Services Establishment, a
Liechtensein corporation ("WSE"), and Xxxx Xxxxxx Group, Inc., a Florida
corporation ("GPG"), with reference to the following facts:
A. WSE has the sole and exclusive license in perpetuity to use and
sublicense the Player Name in the Exploitation of Endorsed Products in the
Territory (as such terms are hereinafter defined).
B. Xxxx Xxxxxx is famous throughout the world as a champion
professional golfer, international celebrity and spokesperson whose endorsement
of products and services has great intrinsic and commercial value.
C. On the terms and subject to the conditions of this Agreement, WSE
desires to grant to Licensee the sole and exclusive right and license to use the
Player Name in the Territory in the Exploitation of Endorsed Products (as such
terms are hereinafter defined).
NOW THEREFORE, in consideration of the premises and the mutual promises
contained herein, the parties hereto do hereby agree as follows:
1 GRANT OF RIGHTS; DEFINITIONS
(a) On the terms and subject to the conditions in this Agreement, WSE
hereby grants to Licensee the sole and exclusive right and license (the
"LICENSE") in perpetuity to use the Player Name in the Exploitation of Endorsed
Products throughout the Territory. The License shall commence as of the
Effective Date. The License shall include and encompass without limitation each
and every Intellectual Property Right arising or existing in connection with,
with respect to, or embodied in, the Player Name in connection with the use of
such Player Name in the Exploitation of Endorsed Products.
(b) WSE reserves the right to: (i) produce or cause to be produced, in
connection with the Xxxx Xxxxxx Golf Academy, instructional golf videos and
other golf instruction products and aids in any media incorporating the Player
Name ("GOLF INSTRUCTION PRODUCTS") and market and sell Golf Instruction Products
other than on a Direct Marketing Basis (except as provided below); and (ii)
produce, market and sell biographical videos and other biographical products
incorporating the Player Name. Except for the Existing DM Licenses, WSE may
market and sell Golf Instruction Products on a Direct Marketing Basis only
through Licensee, in which event Licensee shall reasonably cooperate with WSE.
WSE and Licensee shall share on an equal basis all Net Revenues from the sale of
Golf Instruction Products on a Direct Marketing Basis. "NET REVENUES" from the
sale of Golf Instruction Products shall mean revenues from such sales less the
related cost of goods sold, including sales commissions. WSE agrees not to renew
or extend any Existing DM License, and will use commercially reasonable efforts
transfer such business to Licensee (but WSE shall not be obligated to breach any
Existing DM License).
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"AFFILIATE" shall mean, with respect to any specified Person, (a) any
other Person who, directly or indirectly, owns or controls, is under common
ownership or control with, or is owned or controlled by, such specified Person,
(b) any other Person who is a director, officer, partner or trustee of the
specified Person or a Person described in clause (a) of this definition or any
spouse of the specified Person or any such other Person, (c) any relative of the
specified Person or any other Person described in clause (b) of this definition,
or (d) any Person of which the Specified Person and/or any one or more of the
Persons specified in clause (a),(b) or (c) of this definition, individually or
in the aggregate, beneficially own 10% or more of any class of voting securities
or otherwise have a substantial beneficial interest.
"AGREEMENT YEAR" shall mean a year period commencing with the Effective
Date or an annual anniversary of the Effective Date and terminating one year
thereafter.
"ARTWORK" shall mean photographs, film footage and video footage of
Player participating in golf tournaments, exhibitions and other public
appearances in his capacity as a golf professional.
"ASSET PURCHASE AGREEMENT" shall mean that certain Asset Purchase
Agreement dated as of the date hereof by and between GPG and Golf One pursuant
to which, among other things, GPG has agreed to sell, transfer and assign
certain assets, including its rights under this Agreement, to Golf One.
"DIRECT MARKETING BASIS" shall mean marketing and sales through
infomercials, telemarketing, Internet or other computer systems, direct mail,
CD-ROM, and other direct response marketing channels.
"EFFECTIVE DATE" shall mean date of the closing of the purchase and
sale of the assets contemplated by the Asset Purchase Agreement.
"ELECTRONIC MEDIA" shall mean all forms of electronic, magnetic,
digital, optical and laser-based information storage and retrieval systems,
floppy diskette-based software, CD-ROM, interactive software and compact discs,
floptical disks, ROM Card, silicon chip, on-line electronic or satellite-based
data transmission and other such systems, and any other device or medium for
electronic reproduction, publication, distribution or transmission, whether now
or hereafter known or developed.
"ENDORSED PRODUCTS" shall mean (i) golf clubs, including, but not
limited to Xxxxx, Irons and Specialty Clubs, including Drivers, Wedges, Chippers
and Putters; and (ii) Golf Accessories.
"EXHIBIT" shall mean to produce, transmit, broadcast, telecast, cable
cast, display, exhibit, project, perform, reproduce, publicize, or otherwise
use.
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"EXISTING DM LICENSES" shall mean the licenses identified on Exhibit B
to this Agreement as "Existing DM Licenses."
"EXISTING LICENSES" shall mean the licenses described in Exhibit B to
this Agreement other than Existing DM Licenses.
"EXPLOIT" shall mean use, promote, advertise, affix, copy, Exhibit,
distribute, manufacture, sell, market, sublicense, rent, modify, create
derivative works from, practice or otherwise exploit in all forms in any and all
media.
"GOLF ACCESSORIES" shall mean hats, apparel, towels, umbrellas, bags,
balls, audiotapes, videotapes and other products pertaining to the playing of
golf or the marketing, sale and distribution of golf clubs.
"GOLF ONE" shall mean Golf One Industries, Inc., a Delaware
corporation.
"INITIAL QUARTER" shall mean the period commencing the Effective Date
and terminating on the last day of the calendar quarter in which the Effective
Date occurs.
"INTELLECTUAL PROPERTY RIGHTS" shall mean each and every right now or
hereafter recognized and enforced under trademark, service xxxx, copyright,
patent, trade secret and all other intellectual laws, whether existing by
statute and/or at common law, of each jurisdiction within the world.
"LICENSEE" shall mean the Licensee under this Agreement, which
initially be GPG, and shall be Golf One and its successors and permitted assigns
from and after the Effective Date.
"LICENSE FEE" shall have the meaning set forth in Section 2(a) of this
Agreement.
"MARKETING MATERIALS" shall mean brochures, advertisements, pictures,
photos, films, infomercials, commercials, videos and similar materials used to
market, advertise and promote the Endorsed Products which utilize or incorporate
the Player Name.
"MEDIA PRODUCTION" shall mean television programs and broadcasts, radio
programs and broadcasts, television or radio series, newscasts, documentaries,
video productions, video tapes, video discs, sound tracks, motion picture
productions, and any other form of media production that has been, or may in the
future be, conceived, developed or invented, by any process, instrumentation or
device now known or hereafter developed.
"NET RECEIPTS" during any period shall mean (i) gross revenues of
Licensee from the sale of Endorsed Products throughout the world during such
period less (ii) discounts, incentives, applicable advertising, freight, duty
and commissions, less (iii) all Refunds during such period which are not offset
against Return Reserves, less (iv) all Return Reserves established during such
period with respect to sales of Endorsed Products during such period, plus (v)
all Return Reserves in effect at the beginning of such period which shall not be
used to offset Refunds
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during such period. With respect to sales of Endorsed Products by Licensee which
are not manufactured or produced by Licensee or sold only for the account of
Licensee, "gross revenues" shall mean only the selling commissions and fees
received by Licensee, and not the gross revenues from the sale of the Endorsed
Products. For example, if Licensee sublicenses to a third party the right to
incorporate the Player Name on golf hats, and then Licensee acts as sales,
distribution and/or marketing agent for such golf hats on a Direct Marketing
Basis (and collects the full price for such hats from customers), "gross
revenues" shall include only that portion of the sales price for such golf hats
as may be retained by Licensee in connection with the sale of such golf hats.
Net Receipts shall not include revenues from the sale of Golf Instruction
Products produced or on behalf of WSE which are sold by Licensee on a Direct
Marketing Basis, as contemplated by Section 1(b) of this Agreement.
"PERSON" shall mean an individual or a partnership, corporation, trust,
association, limited liability company, governmental authority or other entity.
"PLAYER" shall mean Xxxx Xxxxxx, a professional golfer.
"PLAYER AGREEMENT" shall mean that certain Player License Agreement
dated the date hereof by and between Player and GPG pursuant to which Player has
granted to GPG the exclusive perpetual right to use the Player Name in the
Exploitation of Endorsed Products outside the Territory.
"PLAYER NAME" shall mean the name "Xxxx Xxxxxx," the initials, voice,
signature and likeness of Player, the Knight's Head Logo, the trademark BLACK
KNIGHT(TM) and any other trademark presently or hereafter used by Player in
connection with Endorsed Products.
"PLAYER PERCENTAGE" for any Royalty Year shall mean the percentage
obtained by dividing the Subject Net Receipts for such Royalty Year by the Net
Receipts for such Year.
"PLAYER/WSE LICENSE" shall mean that certain Memorandum of Agreement
dated as of January 1, 1967 between Player and WSE, as amended by that certain
Amendment Agreement dated January 1, 1987, that certain letter dated January 1,
1997 and that certain letter dated April 17, 1998.
"REFUNDS" shall mean amounts refunded by Licensee to customers for any
reason, including for product returns, damaged products, canceled orders or
otherwise relating to Endorsed Products.
"RETURN RESERVE" shall mean reserves reasonably maintained by the
Company from time to time for Refunds.
"ROYALTY QUARTER" shall mean a calendar quarter, provided that the
first Royalty Quarter shall be Initial Quarter.
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"ROYALTY STATEMENT" shall mean a Royalty Statement as defined in
Section 2(b) of this Agreement.
"ROYALTY YEAR" shall mean a period commencing April 1 and terminating
the following March 31; provided that the first Royalty Year shall be the period
commencing on the Effective Date and ending on the following March 31 and the
last Royalty Year (if any) shall be the period ending on the date this Agreement
terminates and commencing on the immediately prior April 1.
"SUBJECT NET RECEIPTS" shall mean Net Receipts from sales in the
Territory.
"TERRITORY" shall mean all parts of the world other than the United
States of America and its possessions, Canada, the Commonwealth of Puerto Rico
and each country or territory in the continent of Africa which is lies
completely south of the Equator.
"TRANSFER" shall mean sell, assign, transfer, pledge, grant a security
interest in, or otherwise dispose of, with or without consideration.
2. REMUNERATION
(a As full and complete consideration for the License as set forth
herein, and for WSE making available the ancillary marketing services of Player
to be performed hereunder, Licensee shall pay to WSE the following amounts set
forth in Sections 2(b) and 2(c).
(b Licensee shall pay to WSE the following endorsement fees (the
"LICENSE FEES"):
AGREEMENT YEAR AMOUNT
1 $112,500
2 $150,000
3 $187,500
4 $225,000
5-10 $262,500 (per year)
The obligation to pay License Fees shall terminate on the earlier to
occur of: (i) the first date that Player has not played in at least 10
internationally televised professional golf tournaments in the prior 12 months
(the "TOURNAMENT TEST") and is no longer the Chairman of the Board of Golf One;
and (i) the tenth anniversary of the Effective Date; provided, however, that if
prior to the end of the fifth Agreement Year a Removal Event occurs, Player
shall be entitled to continue to receive the License Fees through the end of the
fifth Agreement Year following the Agreement Year immediately prior to the
Agreement Year in which the Removal Event occurs provided he continues to meet
the Tournament Test. A "REMOVAL EVENT" shall be deemed to
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occur if: (i) Player is removed by the shareholders of Golf One without cause as
Chairman of the Board of Golf One or (ii) at any shareholders' meeting at which
Player's position as director is up for election, Player is not re-elected by
the shareholders as a director of Golf One (assuming he has continued to serve
through the date of such meeting). The License Fee for each Agreement Year shall
be paid in four equal installments on a quarterly basis within 30 days following
the end of each calendar quarter during the Year, commencing with the first
calendar quarter which ends in such Year. The payment for any period which is
not a full calendar quarter shall be prorated other than in the period in which
this Agreement is terminated by Player pursuant to Section 8(b) of this
Agreement.
(c In addition to the License Fee, each Royalty Year Licensee shall
pay to WSE a royalty (the "ROYALTY") equal to the Player Percentage for such
Royalty Year multiplied by the sum of: (i) 3% of Net Receipts from sales of
Endorsed Products on a Direct Marketing Basis which are in excess of $10,000,000
and are less than or equal to $20,000,000; (ii) 2% of Net Receipts from sales of
Endorsed Products on a Direct Marketing Basis which are in excess of
$20,000,000; and (iii) 3% of Net Receipts from Net Sales of Endorsed Products
other than on a Direct Marketing Basis. The $10,000,000 and $20,000,000 amounts
shall be prorated for the first and last Royalty Years. The Royalty shall be
advanced on a quarterly basis, within 30 days from the end of each Royalty
Quarter, based on the good faith estimate of the Player Percentage determined
for the year-to-date. It is understood that notwithstanding any advances of the
Royalty, the actual Royalty for any Royalty Year shall be determined in
accordance with the formula set forth in first sentence of this Section 2(c),
and that the final payment of the Royalty for such Royalty Year shall be the
difference between the amount of the Royalty determined in accordance with such
first sentence and the amounts previously advanced. If the amount of Royalty
advanced for any Royalty Year shall exceed the actual Royalty determined in
accordance with such first sentence, Licensee shall offset such excess against
future Royalties or other obligations payable under this Agreement; provided,
however, that if the amount of overpayment exceeds 10% of the total Royalty for
such Royalty Year, the Company may demand the refund of such of excess from
Licensor.
(d Within 30 days following the end of each Royalty Quarter, Licensee
shall deliver to WSE a royalty statement (a "ROYALTY STATEMENT") setting forth
the Net Receipts for the Quarter and the calculation of the Royalty, which
Statement shall be certified by an executive officer of Licensee as being true
and complete. Each Royalty Statement shall be conclusive and binding upon WSE as
to the amount of the Royalty for the Royalty Quarter covered by such Statement
unless WSE shall object in writing within two years following receipt of such
Royalty Statement. Upon reasonable prior notice, WSE shall have the right to
examine Licensee's books and records (but in no more than twice each Royalty
Year) to the extent reasonably necessary to determine the accuracy and
completeness of the information on such Statement. Such examination shall be
made during Licensee's usual business hours at the place where such books and
records are maintained. Unless such examination and inspection results in a
determination that Licensee underpaid the Royalty in either of the two prior
Royalty Years by more than the greater of 5% of the Royalty actually due or
$2,500, such examination shall be at the cost and expense of WSE. If such
examination or inspection shows that the Royalty in either of the two prior
Royalty Years shall
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have underpaid by more than the greater of 5% of the Royalty actually due or
$2,500, all costs and expenses for such examination, up to $10,000 per
examination, shall be paid by Licensee.
3. WSE APPROVALS
(a Licensee agrees that all uses of the Player Name in connection with
the Exploitation of Endorsed Products in the Territory, including in connection
with Marketing Materials and the quality of the Endorsed Products, will be
subject to prior approval of WSE, which approval will not be unreasonably
withheld. It is understood that, with respect to the use of the Player Name,
each approval shall relate to the use of the Player Name in connection with the
form and content of the Marketing Materials and/or the incorporation of the
Player Name on Endorsed Products, and that once given, no further approval shall
be required with respect to multiple uses of approved uses the Player Name or
immaterial variances in the Marketing Materials (immateriality be determined by
reference to the materiality of such change to WSE). Any approvals required by
WSE or requested of WSE pursuant to the terms hereof shall be given by confirmed
facsimile or certified mail to Licensee within a reasonable time from the date
of receipt by WSE of the materials for which approval is requested. In the event
no response by WSE is received by Licensee within 10 days from receipt of such
materials by WSE, the approvals shall be deemed given. All sublicenses, other
than those in effect on the date hereof, must permit Licensee (and indirectly
WSE) the same right of approval unless otherwise agreed in writing by WSE. WSE
may from time to time delegate to one person, or any one of several persons, its
approval rights by written notice to Licensee, in which event until such
delegation is withdrawn by written notice to Licensee, all approvals may be
granted by such person or persons.
(b Licensee shall own the copyright to all Marketing Materials. WSE
shall take any action reasonably requested by Licensee to confirm such
ownership. Licensee acknowledges that it does not own the Player Name.
4. WSE'S WARRANTIES AND COVENANTS
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(a WSE warrants and represents as follows: (i) WSE has all right,
power and authority to enter into this Agreement and grant the License; (ii) WSE
has the exclusive rights to use the Player Name in the Exploitation of Endorsed
Products in the Territory; (iii) except pursuant to this Agreement and the
Existing Licenses, no Person has any right to use the Player Name in the
Exploitation of Endorsed Products in the Territory and there are no licenses or
other rights presently outstanding for the use of the Player Name in the
Exploitation of the Endorsed Products in the Territory; (iv) the Exploitation of
the Player Name in connection with Endorsed Products contemplated by this
Agreement will not violate or infringe upon the rights (including, but not
limited to, the Intellectual Property Rights) of any Persons anywhere in the
world; (v) the use of the Player Name as contemplated by this Agreement will not
require any payments to any Person other than to WSE pursuant to this Agreement;
and (vi) WSE has provided to Licensee a true and correct copy of the Player/WSE
License; the Player/WSE License is in full force and effect, constitutes a valid
and legally binding obligation of Player and WSE, enforceable against Player and
WSE in accordance with its terms, and neither Player nor WSE is in breach of or
in default under the Player/WSE License and in no event has occurred or
circumstance exists which, with notice or lapse of time or both, would
constitute a breach of or default under the Player/WSE License. Licensee
acknowledges that WSE makes no representations with respect to the use of any
other Intellectual Property Rights in connection with any Marketing Materials or
the Exploitation of the Player Name.
(b WSE agrees that from and after the date hereof, WSE shall not
directly or indirectly use the Player Name in the Exploitation of any Endorsed
Products, or Transfer any right or license to use the Player Name in the
Exploitation of Endorsed Products.
(c Notwithstanding anything to the contrary contained herein, it is
mutually understood that WSE has no control over, and is not responsible for:
(i the media, including without limitation, any news, media
photographs or other depictions of Player that may appear from time to time;
(ii the content of the advertising or sponsorship portion not
directly involving WSE of:
(A any Media Production;
(B any athletic tournament, game or outing; or
(C any other event, including without limitation, any live
artistic, literary, dramatic, theatrical or musical
production or charitable event, in which Player
participates or with which he is otherwise associated.
(iii the products and services endorsed, promoted, advertised or
publicized by any other team, league or association for which Player may play or
with respect to which he may become associated or by any of their respective
successors and assigns;
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all or any of which may use Player's name, fame, nickname, initials, autograph,
voice, video or film portrayals, facsimile or original signature, photograph,
likeness and image or facsimile image, without Player's consent and in any or
all of which Player may appear or participate. Licensee agrees that WSE shall
not be, and shall not be deemed to be, in contravention or breach of any of the
provisions hereof as a result of any or all of the foregoing or arising in
connection therewith.
(d The restrictions set forth in this Agreement are not intended to
preclude and shall not preclude Player from appearing in the sports,
entertainment, news or information portion of:
(i any form of Media Production; or
(ii any professional golf tournament; or
(iii any other entertainment event, including without limitation,
any live artistic, literary, dramatic, theatrical or musical production;
in which or in connection with which products or services are advertised,
publicized, featured or otherwise dealt with that are the same as or similar to
or competitive with Endorsed Products or that are sponsored by competitors of
Licensee, provided that Player's participation is not for the endorsement of
such products or services.
(e WSE is not responsible for initiating action against, enjoining or
otherwise attempting to dissuade any Person not licensed by WSE, including
without limitation, any former licensee of WSE, the media or any advertiser,
promoter or other entity, which in contravention of this Agreement or otherwise
makes unauthorized use of anything, including without limitation, any
unauthorized use of the Player Name in promoting or advertising any product (or
products) or services whatsoever, including without limitation, any products
which are the same as or similar to or directly competitive with Endorsed
Products. WSE shall not incur any liability to Licensee or any Person arising
out of any such activity by any such Person. WSE agrees that at Licensee's sole
cost and expense, it shall give such reasonable assistance to Licensee as may be
required to cause any such Person to cease and desist from such activities, or
in connection with any lawsuit or other proceeding by Licensee against such
Person.
(f To the extent that WSE has (and has all necessary rights to) any
Artwork which Licensee believes would be useful in the Exploitation of Endorsed
Products, WSE shall furnish such Artwork to Licensee on a royalty-free basis.
Licensee shall be responsible for all shipping and handling charges in
connection with such Artwork, shall safekeep such Artwork and be responsible for
it while in transit, and after use of such Artwork, Licensee shall return such
Artwork to WSE. It is understood that such Artwork may not be reproduced for
sale but just used in connection with the advertisement and promotion of
Endorsed Products. Any such use of Artwork is subject to WSE's prior approval
pursuant to Section 3(a) of this Agreement. To the extent that any Artwork is
owned by Persons other than WSE, upon request of Licensee, WSE shall provide
such consents or approvals to such other Persons as may be necessary for
Licensee to acquire (at no cost or expense to WSE) the right to use such
Artwork.
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(g WSE agrees: (i) not to amend or modify the Player/WSE License
without the prior written consent of: (A) GPG until such time as GPG has
assigned this Agreement to Golf One and (B) Golf One unless and until the Asset
Purchase Agreement shall be terminated without the closing of the transactions
contemplated thereby, in which event the agreement in this Section 4(g)(i) shall
terminate; and (ii) that should the Player/WSE License terminate, this Agreement
shall be deemed to be an agreement between Player and GPG (or its assignee),
without further action of any Person, and thereafter WSE shall have no rights
under this Agreement and Player shall succeed to the rights of WSE.
5. INDEMNIFICATION; LIABILITY
(a WSE agrees to indemnify and hold Licensee and its successors and
permitted assigns, and their respective Affiliates ("LICENSEE INDEMNIFIED
PARTY") harmless from and against any and all claims, losses, costs, damages,
liabilities and expenses (including attorneys' fees and court costs) suffered or
incurred by any Licensee Indemnified Party arising out of breach by WSE of any
warranty, representation or covenant hereunder or the use pursuant to this
Agreement by such Licensee Indemnified Party of the Player Name.
(b Licensee agrees to indemnify and hold WSE and its successors and
permitted assigns, and their respective Affiliates, including Player if Player
assumes the obligations of WSE pursuant to Section 4(g) ("PLAYER INDEMNIFIED
PARTY") harmless from and against any and all claims, losses, damages,
liabilities and expenses (including attorneys fees and court costs) suffered or
incurred by any Player Indemnified Party arising out of a breach by Licensee of
any warranty, representation or covenant hereunder, from the Exploitation by
Licensee of the Endorsed Products, from Endorsed Products, from the use of the
Player Name and from the violation of any law, rule or regulation in connection
with the Exploitation of the Player Name (other than claims, losses, damages,
liabilities and expenses (including attorneys fees and court costs) related to a
breach by WSE of any of its representations, warranties or covenants under this
Agreement, such as an infringement claim against Licensee for infringement of
another Person's rights based solely on the use by Licensee of the Player Name
other than with the respect to use of other Intellectual Property Rights in
connection therewith).
(c In no event shall any party to this Agreement be liable to the
other for punitive, indirect or special damages.
6. INSURANCE. From and after the Effective Date, Licensee shall provide
and maintain, at its own expense, commercial general liability insurance,
including product liability and advertising injury coverage, with limits of not
less than $5,000,000, and shall cause such policy to be endorsed to state that
WSE is an additional named insured thereunder. A certificate of insurance
evidencing such coverage shall be furnished to WSE within 30 days following the
Effective Date. Such insurance policy shall provide that the insurer shall not
terminate or materially modify such policy or remove WSE as an additional named
insured without prior written notice to WSE at least 30 days in advance thereof.
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7. RESERVATION OF RIGHTS
WSE reserves all rights pertaining to the Player Name which it holds
pursuant to the Player/WSE License except as specifically granted to Licensee
hereunder.
8. TERMINATION
(a Licensee shall have the right, upon 30 days prior written notice to
WSE, to terminate this Agreement in the event that governmental regulations or
other causes arising out of a state of national emergency or war, or causes
beyond Licensee's control, render Licensee's performance under this Agreement
materially impaired.
(b In the event that either party defaults in any material respect
under any of the material terms or conditions set forth herein, including but
not limited to payments, the non-defaulting party shall send a notice to cure by
either certified or registered mail return receipt requested to the defaulting
party. Failure by the defaulting party to cure the default within 30 days of
receipt of the notice to cure shall give the right to the non-defaulting party,
in its sole discretion, to terminate this Agreement.
(c Licensee shall have the right to terminate this Agreement upon
written notice to WSE in the event that the Player Agreement shall be terminated
other than termination by Player in accordance with the Player Agreement as a
result of the default by Licensee under the Player Agreement.
(d WSE shall have the right to terminate this Agreement after the
Effective Date in the event of termination of the Player Agreement by Player as
a result of the default by Licensee under such Agreement following the Effective
Date.
(e Promptly following termination of this Agreement, Licensee shall
provide WSE with a statement indicating the remaining Endorsed Products in
inventory, in process of manufacture or subject to non-cancelable orders as of
the termination date ("REMAINING PRODUCTS"). Unless this Agreement is terminated
by WSE pursuant to Section 8(b) or 8(d) hereof or by Licensee pursuant to
Section 8(a) or 8(h), Licensee shall have the right to sell any Remaining
Products for a period of six months after termination of this Agreement (the
"SELL-OFF PERIOD"). Notwithstanding the foregoing, Licensee shall not have the
right, other than with respect to Remaining Products, to manufacture any
additional Endorsed Products. No License Fee shall accrue during the Sell-Off
Period provided that the Royalty shall accrue during the Sell-Off Period and be
payable as contemplated by Section 2(b) of this Agreement. Upon the expiration
of the Sell-Off Period, or termination by WSE pursuant to Section 8(b) or 8(d)
of this Agreement, Licensee shall destroy any remaining inventory and shall
certify same by declaration executed by an executive officer of Licensee.
(f The termination of this Agreement for any reason will not have any
effect on: (i) the rights of WSE to collect any amounts due and owing under this
Agreement; (ii) the rights of Licensee to sell its remaining inventory in
accordance with Section 8(e) except as provided in
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Section 8(e) hereof; (iii) the rights to indemnification pursuant to Section 5
of this Agreement; and (iv) the rights to damages or other legal or equitable
relief for breaches or defaults occurring prior to the termination of the
Agreement.
(g If WSE files a petition in bankruptcy or is adjudicated bankrupt,
or becomes insolvent or makes an assignment for the benefit of creditors or
other similar arrangement or discontinues business, or if a receiver is
appointed for it or its business, this Agreement shall not terminate upon the
occurrence of any such event and WSE shall not have the authority to Transfer
any rights of any nature for the use of the Player Name or any Endorsed Products
in conflict with this Agreement or to reject any rights hereunder.
(h If Licensee files a petition in bankruptcy or is adjudicated
bankrupt, or becomes insolvent or makes an assignment for the benefit of
creditors or other similar arrangements or discontinues business, or if a
receiver is appointed for it or its business, this Agreement shall terminate
upon the occurrence of such event.
9. MISCELLANEOUS.
(a Notices. All notices, requests, demands and other communications
(collectively, "NOTICES") given pursuant to this Agreement shall be in writing,
and shall be delivered by personal service, courier, confirmed facsimile
transmission or by United States first class, registered or certified mail,
postage prepaid, addressed to the party at the address set forth on the
signature page of this Agreement. Any Notice, other than a Notice sent by
registered or certified mail, shall be effective when received; a Notice sent by
registered or certified mail, postage prepaid return receipt requested, shall be
effective on the earlier of when received or the fifth day following deposit in
the United States mails. Any party may from time to time change its address for
further Notices hereunder by giving notice to the other party in the manner
prescribed in this Section.
(b Entire Agreement. This Agreement contains the sole and entire
agreement and understanding of the parties with respect to the entire subject
matter of this Agreement, and any and all prior discussions, negotiations,
commitments and understandings, whether oral or otherwise, related to the
subject matter of this Agreement are hereby merged herein.
(c Waiver and Amendment. No provision of this Agreement may be waived
unless in writing signed by all the parties to this Agreement, and waiver of any
one provision of this Agreement shall not be deemed to be a waiver of any other
provision. This Agreement may be amended only by a written agreement executed by
all of the parties to this Agreement. This Agreement may not be amended prior to
the Effective Date without the prior written consent of Golf One unless and
until the Asset Purchase Agreement is terminated.
(d Governing Law. This Agreement has been made and entered into in the
State of California and shall be construed in accordance with the laws of the
State of California without giving effect to the principles of conflicts of law
thereof.
13
(e Severability. Whenever possible each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be or become
prohibited or invalid under applicable law, such provision shall be ineffective
to the extent of such prohibition or invalidity without invalidating the
remainder of such provision or the remaining provisions of this Agreement.
(f Captions. The various captions of this Agreement are for reference
only and shall not be considered or referred to in resolving questions of
interpretation of this Agreement.
(g Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
(h Attorneys' Fees. If any action, suit, arbitration or other
proceeding is instituted to remedy, prevent or obtain relief from a default in
the performance by any party to this Agreement of its obligations under this
Agreement, the prevailing party shall recover all of such party's attorneys'
fees incurred in each and every such action, suit, arbitration or other
proceeding, including any and all appeals or petitions therefrom. As used in
this Section, attorneys' fees shall be deemed to mean the full and actual costs
of any legal services actually performed in connection with the matters involved
calculated on the basis of the usual fee charged by the attorney performing such
services and shall not be limited to "reasonable attorneys' fees" as defined in
any statute or rule of court.
(i Further Assurances. The parties to this Agreement shall upon
request take any and all actions and execute any and all documents reasonably
necessary to effectuate the terms and intent of this Agreement.
(j Judicial Interpretation. Should any provision of this Agreement
require judicial interpretation, it is agreed that a court interpreting or
construing the same shall not apply a presumption that the terms hereof shall be
more strictly construed against any Person by reason of the rule of construction
that a document is to be construed more strictly against the Person who itself
or through its agent prepared the same, it being agreed that all parties have
participated in the preparation of this Agreement.
(k Independent Relationship. This Agreement does not constitute and
shall not be construed to constitute an agency, a partnership or a joint venture
agreement between WSE and Licensee. Licensee shall not have authority to
obligate or bind WSE in any manner whatsoever, subject to the provisions stated
herein and only as WSE may specifically approve in writing prior thereto. WSE
and Licensee shall be deemed independent contractors in all respects.
(l Assignments. WSE may not Transfer its rights or obligations under
this Agreement except that WSE may assign its right to receive the License Fee
and the Royalty. Licensee may not Transfer its rights or obligations under this
Agreement except: (i) to a subsidiary or to a Person who controls Licensee;
and/or (ii) through a merger or consolidation of Licensee with another Person
(other than an Excluded Purchaser); and/or (iii) the sale by Licensee of all or
substantially all of its assets to another Person (other than an Excluded
Purchaser); and/or (iv)
14
GPG may assign its rights and obligations to Golf One pursuant to the Asset
Purchase Agreement. For purposes of this Agreement, an "EXCLUDED PURCHASER" is a
Person: (i) whose sales of golf clubs in the United States exceeded 10% of the
total sales of golf clubs in the United States during the calendar year prior to
the sale or merger date, based on industry reports (or, if no such report is
available for such prior calendar year, the most recent prior calendar year for
which such report is available); (ii) whose corporate name includes the name of
any recognized professional golfer; or (iii) which has over 25% of its capital
stock owned by a recognized professional golfer. Any assignee permitted pursuant
to the terms of this Section 8(l) must be capable of fulfilling all terms of
this Agreement and, further, except for the assignment from Licensee to Golf
One, no such assignment shall act to relieve the assignor of its obligations and
duties under this Agreement. Upon the request of Golf One following the
assignment of this Agreement to Golf One, WSE and Golf One shall enter into a
new contract, identical to this Agreement, deleting references to GPG.
(m Force Majeure. If any party to this Agreement is delayed in the
performance of any of its obligations under this Agreement or is prevented from
performing any such obligations (other than, in all events, the payment of
money) due to causes or events beyond its control, including, without
limitation, acts of God, fire, flood, earthquake, strike or other labor problem,
injunction or other legal restraint, present or future law, governmental order,
rule or regulation, then such delay or nonperformance shall be excused and the
time for performance thereof shall be extended to include the period of such
delay or nonperformance.
(n Arbitration. All disputes, controversies or differences which are
not settled by common accord shall be conclusively settled by arbitration in Los
Angeles, California, in accordance with the rules of the American Arbitration
Association, and judgment and the award rendered by the arbitration panel may be
entered in any court or tribunal of competent jurisdiction. In any arbitration
proceeding conducted pursuant to this Section, both parties shall have the right
to discovery, to call witnesses and to cross-examine the other party's witnesses
(either through legal counsel, expert witnesses or both). All decisions of the
arbitration panel shall be final, conclusive and binding upon all parties, and
shall not be subjected to judicial review. The arbitration provisions of this
Agreement shall not prevent any party from obtaining injunctive relief from a
court of competent jurisdiction to enforce the obligations for which such party
may obtain provisional relief pending any decision on such merits by an
arbitrator.
(o Remedies. In the event either party materially breaches this
Agreement, Licensee and WSE agree that, in addition to any and all other
remedies available at law or in equity, the non-breaching party shall be
entitled to injunctive relief to the extent permitted by law from further
violation of this Agreement, during any proceeding as well as on final
determination thereof, without prejudice to any other right of either party.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
XXXX XXXXXX GROUP, INC.
By:_____________________________
15
Its:____________________________
0000 XXX Xxxxxxxxx
Xxxxx 0000
Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000
WORLD SERVICES ESTABLISHMENT
By: ___________________________
Its: ____________________________
0000 XXX Xxxxxxxxx
Xxxxx 0000
Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000
ACKNOWLEDGMENT AND AGREEMENT
The undersigned, the licensor under the Player/WSE License, hereby
acknowledges and agrees as follows:
1. The undersigned consents to WSE entering into this Agreement, and
acknowledges that this Agreement and the rights granted hereunder are consistent
with the Player/WSE License;
2. The undersigned agrees that the Player/WSE License shall not be
modified or amended in any manner without the prior written consent of: (i) GPG
until such time as GPG has assigned this Agreement to Golf One and (ii) Golf One
unless and until that certain Asset Purchase Agreement dated November 1, 1997
(the "Asset Purchase Agreement") between Golf One and GPG shall be terminated
without the closing of the transactions contemplated thereby, in which event
these restrictions will terminate;
3. The undersigned agrees that if for any reason the Player/WSE License
shall be terminated, this Agreement shall remain in full force and effect and,
without any further action, the undersigned shall be deemed to have assumed all
of the obligations and duties of WSE under this Agreement and shall have
succeeded to all of the rights, whether contingent, accrued or future, of WSE
under this Agreement; in this connection, the undersigned agrees to execute such
documents and instruments as shall be reasonably requested by GPG (or its
successor) to evidence such assumption;
4. The undersigned agrees to take no action that would be inconsistent
with the rights of GPG or Golf One under this Agreement or the undersigned's
ability to fully and faithfully
16
perform the obligations of WSE under this Agreement should the undersigned
succeed to the rights and obligations of WSE under this Agreement as provided in
Section 3 of this Agreement;
5. The undersigned acknowledges and agrees that none of his covenants
or agreements under this Acknowledgment and Agreement may be modified, amended,
rescinded or terminated without the prior written consent of Golf One, unless
the Asset Purchase Agreement shall be terminated without the closing of the
transactions contemplated thereby, in which event this restriction shall
terminate.
-------------------
Xxxx Xxxxxx
17
EXHIBIT A TO AGREEMENT
BETWEEN
XXXX XXXXXX GROUP, INC. AND XXXX XXXXXX
[INTENTIONALLY LEFT BLANK]
Exhibit A - 1
18
EXHIBIT B
EXISTING LICENSES AND EXISTING DM LICENSES
Existing Licenses:
1. Agreement, dated January 1, 1996, by and between Xxxx Xxxxxx Golf Equipment
Inc. and YGM Marketing Pte Ltd.
2. Agreement, dated November 15, 1996, by and between Xxxx Xxxxxx Golf
Equipment Inc. and Toppoint Corporation Limited.
3. Licensing Agent Agreement, dated September 24, 1996, by and between Xxxx
Xxxxxx Golf Equipment Inc. and International Apparel Marketing Corporation.
4. Agreement, dated January 17, 1997, by and between Xxxx Xxxxxx Golf
Equipment Inc. and Scorpion Asia Pacific Pte., Ltd.
5. Agreement, dated October 1, 1996, by and between Xxxx Xxxxxx Golf Equipment
Inc. and Robern Skiwear Inc.
6. Licensing Agreement, dated July 1, 1997, by and between Xxxx Xxxxxx Group,
Inc., dba Xxxx Xxxxxx Golf Equipment, and Cali-Fame of Los Angeles, Inc.
7. Agreement, dated July 1, 1997, by and between Xxxx Xxxxxx Group, Inc., dba
Xxxx Xxxxxx Golf Equipment, and PT. Bintoro Agung.
Existing DM Licenses:
1. Endorsement Agreement, dated August 1, 1997 by and between Xxxxxxx
Innovative Corporation and Xxxx Xxxxxx Group, d.b.a. Xxxx Xxxxxx Golf
Equipment Inc.
EXHIBIT B - 1
