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Exhibit 10.25
LICENSE AGREEMENT
This License Agreement ("this Agreement") is made and entered into as
of the latest date upon which either party hereto executes this Agreement, to be
effective for all purposes as of December 31, 1998 ("the Effective Date"), by
and between XXXXX XXXXXXX CELLULAR SYSTEMS OF FLORIDA, INC. d/b/a XXXXX XXXXXXX
CELLULAR & PAGERS ("BAC"), a Florida corporation, and XXXXXX X. XXXXXXX a/k/a
XXXXX XXXXXXX ("Xxxxxxx"), an Alabama resident. For the purposes of this
Agreement, BAC and Xxxxxxx are hereinafter referred to as "party", in the
singular, and as "parties", in the plural.
WHEREAS, BAC, XXXXX XXXXXXX SYSTEMS, INC. ("BASI), an Alabama
corporation, XXXXXX X. XxXXXXXX ("XxXxxxxx"), and XXXXX X. XXXXX ("Xxxxx")
executed that certain Agreement dated Xxxxx 0, 0000 ("xxx Prior Agreement"); and
WHEREAS, the Prior Agreement granted to BAC, XxXxxxxx, and Xxxxx a
non-exclusive license to use the Xxxxx Xxxxxxx service marks, trademarks, and
system in a prescribed area of the State of Florida;
WHEREAS, the parties desire to cause the Prior Agreement to be
terminated by the mutual agreement of BAC, BASI, McGinnis, and Xxxxx as of the
Effective Date; and
WHEREAS, the parties desire to replace the Prior Agreement with this
Agreement.
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NOW, THEREFORE, in consideration of the premises, and of the terms
hereinafter contained, the adequacy of which are hereby acknowledged, the
parties, intending to be legally bound, hereby agree as follows:
1. FOREGOING STATEMENTS. The parties hereby acknowledge and agree
that all of the foregoing statements are true and accurate.
The parties further acknowledge and agree that such statements
are integral parts of this Agreement.
2. TERMINATION OF PRIOR AGREEMENT. BAC shall terminate, and shall
cause XxXxxxxx and Xxxxx to terminate, the Prior Agreement.
Xxxxxxx shall cause BASI to terminate the Prior Agreement.
Such terminations shall be structured as a mutual termination
by all those concerned. Such mutual termination shall be a
condition precedent to the validity of this Agreement. Xxxxxxx
represents and warrants that this Agreement will not conflict
with, or cause a default with respect to, any other agreement
by which he is bound.
3. LICENSES GRANTED.
(a) Xxxxxxx hereby grants to BAC an exclusive license
("the Exclusive License") to use the name "Xxxxx
Xxxxxxx", the name "Xxxxx Xxxxxxx Racing", and any
other prefix, suffix, and derivation of the name
"Xxxxx Xxxxxxx", and any and all service marks and
trademarks directly or indirectly related to the
foregoing. BAC shall be
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entitled to use the Exclusive License in connection
with the sale and distribution, both wholesale and
retail, of wireless and wired communication products,
consumer electronic products not contained in
packaging with Allison's name or likeness,
residential security products, personal security
products, and both accessories and services directly
or indirectly related to the foregoing products.
(b) Subject to BAC obtaining Allison's prior written
consent with respect to each product line (which
consent shall not be unreasonably withheld), Xxxxxxx
hereby grants to BAC a non-exclusive license ("the
Non-exclusive License") to sell "Xxxxx Xxxxxxx racing
memorabilia", including souvenirs, clothing, and the
like, separately licensed by Xxxxxxx to others and
all other retail products directly or indirectly
related to such memorabilia, provided that the
Non-exclusive License does not conflict with such
licenses held by others for such memorabilia.
(c) BAC shall be entitled to use the Exclusive License
and the Non-exclusive License within the United
States, including Alaska and Hawaii, and within all
possessions and territories of the United States.
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4. TERM AND TERMINATION. The initial term of this Agreement shall
commence on the Effective Date and shall expire ten (10) years
thereafter ("the Initial Term"). Upon the expiration of the
Initial Term, BAC, in its sole discretion, shall be entitled
to renew this Agreement for an additional term of five (5)
years ("the First Renewal Term"). Upon the expiration of the
First Renewal Term, BAC, in its sole discretion, shall be
entitled to renew this Agreement for an additional term of
five (5) years ("the Second Renewal Term"). Upon the
expiration of the Second Renewal Term, BAC, in its sole
discretion, shall be entitled to renew this Agreement for an
additional term of five (5) years ("the Third Renewal Term").
Upon the expiration of the Third Renewal Term, BAC, in its
sole discretion, shall be entitled to renew this Agreement for
an additional term of five (5) years ("the Fourth Renewal
Term"). Upon the expiration of the Fourth Renewal Term, BAC,
in its sole discretion, shall be entitled to renew this
Agreement for an additional term of five (5) years ("the Fifth
Renewal Term"). With respect to each aforesaid renewal term,
BAC shall be deemed to have exercised its renewal right unless
BAC notifies Xxxxxxx, at least thirty (30) days prior to the
expiration of the immediately preceding term, that it desires
to terminate this Agreement. In the event BAC provides such
notice to
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Xxxxxxx within the aforesaid time period, this Agreement shall
expire on the last day of such immediately preceding term.
Notwithstanding any contrary provision of this Section 4,
either party may immediately terminate this Agreement upon the
material breach of this Agreement by the other party;
provided, however, in the event BAC defaults in the
performance of its financial obligations under this Agreement,
Xxxxxxx shall give written notice of such default to BAC, and
Xxxxxxx shall not be entitled to terminate this Agreement
unless such default is not cured within thirty (30) days after
BAC's receipt of such notice. Upon the expiration or
termination of this Agreement, BAC shall cease and desist from
all use of the subject matter of the Exclusive License.
5. LICENSE FEES.
(a) BAC shall pay to Xxxxxxx, in monthly installments on
the fifteenth (15th) day of each calendar month
comprising the term of this Agreement, the following
annual fixed license fees ("Fixed Fees", in the
plural, and "Fixed Fee", in the singular).
(i) With respect to the first twelve (12) month
period of the Initial Term, the annual Fixed
Fee shall be $36,000. With respect to each
succeeding twelve (12)
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month period of the Initial Term, the annual
Fixed Fee shall be $48,000.
(ii) With respect to each twelve (12) month
period of the First Renewal Term, if any,
the annual Fixed Fee shall be $52,800.
(iii) With respect to each twelve (12) month
period of the Second Renewal Term, if any,
the annual Fixed Fee shall be $58,080.
(iv) With respect to each twelve (12) month
period of the Third Renewal Term, if any,
the annual Fixed Fee shall be $63,888.
(v) With respect to each twelve (12) month
period of the Fourth Renewal Term, if any,
the annual Fixed Fee shall be $70,277.
(vi) With respect to each twelve (12) month
period of the Fifth Renewal Term, if any,
the annual Fixed Fee shall be $77,305.
(b) In addition to the Fixed Fees referred to in Section
5(a) hereinabove, BAC shall pay to Xxxxxxx, within
sixty (60) days after the conclusion of each
accounting year of BAC comprising part of the term of
this Agreement, the annual contingent license fees
("Contingent Fees", in the plural, and "Contingent
Fee", in the singular), as provided for in, and
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strictly in accordance with, the succeeding
provisions of this Section 5(b).
(i) If, with respect to any accounting year of
BAC comprising part of the term of this
Agreement, BAC's annual net sales during
such year do not exceed $100,000,000,
Xxxxxxx shall be entitled to receive a
Contingent Fee with respect to such year in
an amount equal to the excess of the First
Tier Net Sales Base over the aggregate
monthly Fixed Fees to which Xxxxxxx is
entitled with respect to such year. For the
purposes of this Section 5(b)(i), the First
Tier Net Sales Base shall be the product
obtained by multiplying the annual net sales
during such year by .001 (i.e., one-tenths
percent).
(ii) If, with respect to any accounting year of
BAC comprising part of the term of this
Agreement, BAC's annual net sales during
such year exceed $100,000,000, Xxxxxxx shall
be entitled to receive a Contingent Fee with
respect to such year in an amount equal to
the excess of the sum of the Second Tier Net
Sales Base and the Third Tier Net Sales Base
over the aggregate monthly Fixed Fees to
which Xxxxxxx is entitled with respect to
such
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year. For the purposes of this Section
5(b)(ii), the Second Tier Net Sales Base
shall be the product obtained by multiplying
the first $100,000,000 of annual net sales
during such year by .001 (i.e., one-tenths
percent). For the purposes of this Section
5(b)(ii), the Third Tier Net Sales Base
shall be the product obtained by multiplying
annual net sales during such year in excess
of $100,000,000 by .0003 (i.e.,
three-hundredths percent). With respect to
the succeeding provisions of this Section
5(b), the Second Tier Net Sales Base and the
Third Net Sales Base are referred to
collectively as "the Combined Net Sales
Base".
(iii) Sections 5(b)(i) and Section 5(b)(ii)
hereinabove shall constitute mutually
exclusive provisions of this Agreement. The
First Tier Net Sales Base and the Combined
Net Sales Base shall not both be applicable
during any accounting year of BAC. If BAC's
annual net sales during a particular
accounting
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year of BAC do not exceed $100,000,000, only
the First Tier Net Sales Base shall be
applicable with respect to such year. If
BAC's annual net sales during a particular
accounting year of BAC exceed $100,000,000,
only the Combined Net Sales Base shall be
applicable with respect to such year.
(iv) For the purpose of this Section 5(b), the
term "accounting year of BAC" means the
twelve (12) month period adopted by BAC for
financial accounting purposes.
(v) Notwithstanding any contrary provision of or
interpretation of this Section 5(b), in the
event any accounting year of BAC comprising
part of the term of this Agreement does not
constitute twelve (12) months, the
Contingent Fee shall be determined solely
with reference to BAC's actual net sales
during such partial accounting year of BAC.
Furthermore, notwithstanding any contrary
provision of or interpretation of this
Section 5(b), Xxxxxxx shall be entitled to
receive a Contingent Fee with respect to
such partial accounting year of BAC in an
amount equal to the excess of the First Tier
Net Sales Base or the Combined Net Sales
Base, as the case may be, over the aggregate
monthly Fixed Fees to which Xxxxxxx is
entitled with respect to such partial
accounting year of BAC. For the purpose of
the
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immediately preceding sentence, the First
Tier Net Sales Base or the Combined Net
Sales Base, as the case may be, shall be
determined solely with reference to BAC's
actual net sales during such partial
accounting year. If BAC's actual net sales
during a particular partial accounting year
of BAC do not exceed $100,000,000, only the
First Tier Net Sales Base (as described in
this Section 5(b)(v)) shall be applicable
with respect to such partial year. If BAC's
actual net sales during a particular partial
accounting year of BAC exceed $100,000,000,
only the Combined Net Sales Base (as
described in this Section 5(b)(v)) shall be
applicable with respect to such partial
year.
(vi) The parties acknowledge and agree that the
First Tier Net Sales Base and the Combined
Net Sales Base used in determining the
Contingent Fees provided for herein shall be
determined with reference to the accounting
years of BAC (full or partial, as the case
may be), not with reference to the twelve
(12) month periods described in Section 5(a)
hereinabove.
(vii) If, with respect to any full or partial
accounting year of BAC, the applicable First
Tier Net Sales
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Base or the applicable Combined Net Sales
Base, as the case may be, does not exceed
the aggregate monthly Fixed Fees to which
Xxxxxxx is entitled with respect to such
year, Xxxxxxx shall not receive any
Contingent Fee with respect to such year.
6. STOCK PURCHASE OPTION.
(a) Commencing one hundred eighty (180) days after the
Effective Date, and continuing until fifteen (15)
days after the expiration or termination of this
Agreement, Xxxxxxx shall be entitled to purchase from
BAC 75 shares of BAC's common stock at a price of
$600 per share ("the Option"). In the event Xxxxxxx
does not exercise the Option within the aforesaid
period, the Option shall lapse and shall become
invalid. If at the time Xxxxxxx exercises the Option
he is in breach of this Agreement, his rights with
respect to the Option shall be suspended until such
time as such breach is cured to the satisfaction of
BAC. If, after Xxxxxxx purchases BAC common stock
pursuant to the Option ("the Option Stock"), Xxxxxxx
commits a material breach of this Agreement (whether
such breach is an act or an omission), and BAC
terminates this Agreement as a direct result of such
breach, Xxxxxxx shall, at BAC's
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election and in BAC's sole discretion, be obligated
to sell the Option Stock to BAC for an amount equal
to the price paid by Xxxxxxx to BAC therefor. The
Option shall not be transferred by Xxxxxxx to any
individual or entity, without the prior written
consent of BAC.
(b) The parties acknowledge that BAC contemplates merging
into 2Connect Acquisition Corp. ("Acquisition"), a
Florida corporation, pursuant to a forward triangular
merger under the Internal Revenue Code, in which
capital stock of Acquisition's parent company,
2Connect Express, Inc. ("2Connect"), a Florida
corporation, will be exchanged for the capital stock
of BAC. In connection with such merger ("the
Merger"), Acquisition will be the surviving entity,
and BAC's corporate existence shall cease. In the
event the Merger is consummated, BAC shall use its
best efforts to cause the Option to be converted into
an option permitting Xxxxxxx to purchase 7,500 shares
of 2Connect's common stock at a price of $6 per share
("the 2Connect Option"). The 2Connect Option shall be
subject to the same provisions set forth in Section
6(a) hereinabove, with respect to exercise rights,
lapse events, suspension events, and transfer
restrictions; moreover, any common stock of 2Connect
acquired by Xxxxxxx
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pursuant to the 2Connect Option ("the 2Connect
Stock") shall be subject to the same provisions set
forth in Section 6(a) hereinabove with respect to
resale and repurchase upon Allison's commission of a
material breach of this Agreement. For the purpose of
the immediately preceding sentences, 2Connect shall
be substituted for BAC in applying the provisions of
Section 6(a) hereinabove to the 2Connect Option and
the 2Connect Stock.
7. ADVERTISING AND PERSONAL APPEARANCES.
(a) Xxxxxxx shall perform promotional and advertising
activities for BAC, as requested by BAC, including,
but not limited to, radio advertisements, television
advertisements, other mass media advertising, and
promotional activities. However, such activities
shall not exceed forty-eight (48) hours with respect
to any twelve (12) month period of this Agreement.
(b) During each twelve (12) month period of this
Agreement, Xxxxxxx shall personally appear on behalf
of BAC at eight (8) separate promotional events or
other events scheduled by BAC. BAC may, in its sole
discretion, cause Xxxxxxx to personally appear on
behalf of BAC at more than eight (8) promotional or
other events scheduled by BAC, in which case Xxxxxxx
shall be
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entitled to receive the sum of $1,500 for each
personal appearance in excess of eight (8) personal
appearances during any twelve (12) month period of
this Agreement.
(c) Xxxxxxx shall not be entitled to receive any
compensation for performance of the activities
described in Section 7(a) or the eight (8) personal
appearances for the events described in Section 7(b).
However, with respect to the personal appearances
described in Sections 7(a) and 7(b), BAC shall pay
directly, or reimburse Xxxxxxx for, the personal
travel expenses paid or incurred by Xxxxxxx with
respect to such personal appearances, provided that
such expenses are approved in advance, in writing, by
BAC.
8. AUTHORITY AND TITLE. Xxxxxxx represents and warrants that he
owns, or has full authority to license to BAC, the subject
matter of the Exclusive License and the subject matter of the
Non-exclusive License, as described in Section 3. During the
term of this Agreement, Xxxxxxx shall not at any time do or
cause to be done, or fail to do, any act or thing that will in
any way impair his ownership, or authority to license to BAC,
such subject matter. Xxxxxxx further represents and warrants
that he has full authority to enter into this Agreement and
that this Agreement does not infringe upon any proprietary,
patent, copyright,
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trademark, or servicemark rights of any third party. Xxxxxxx
shall indemnify and hold harmless BAC from and against any
claims or damages asserted against BAC by any third party in
connection with any untrue representation or warranty
described in this Section 8; moreover, Xxxxxxx shall reimburse
BAC for all expenses incurred or paid by BAC that are directly
or indirectly related to such claims or damages, including but
not limited to, reasonable attorney fees, court costs,
incidental damages, and consequential damages. For the
purposes of this Agreement, a third party is any individual or
entity other than the parties.
9. LACK OF ECONOMIC FEASIBILITY. Notwithstanding any contrary
provision of this Agreement, in the event BAC shall determine
that its use of the Exclusive License or the Non-exclusive
License is not economically feasible or not profitable with
respect to its business, BAC shall be entitled to terminate
this Agreement upon thirty (30) days prior written notice.
10. TRANSFER OR ASSIGNMENT. BAC shall be entitled to transfer or
assign its rights or obligations (or both) under this
Agreement to a successor, transferee, or assignee upon
providing to Xxxxxxx evidence of such succession, transfer, or
assignment in advance, provided that BAC's successor,
transferee, or assignee agrees, in writing, to be bound by
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the terms of this Agreement to the extent such terms relate to
the rights and obligations succeeded to, transferred, or
assigned. Xxxxxxx shall not be entitled to transfer or assign
his obligations under this Agreement that relate to personal
appearances or personal services; however, Xxxxxxx shall be
entitled to transfer or assign his rights or other obligations
(or both) under this Agreement to a successor, transferee, or
assignee upon providing to BAC evidence of such succession,
transfer, or assignment in advance, provided that Allison's
successor, transferee, or assignee agrees, in writing, to be
bound by the terms of this Agreement to the extent such terms
relate to the rights and obligations succeeded to,
transferred, or assigned.
11. BUSINESS RELATIONSHIP BETWEEN THE PARTIES. Each party agrees
that the other party is an independent contractor, not an
employee of such party. Each party shall be solely responsible
for any income tax, social security tax, self-employment tax,
or other tax applicable to remuneration paid to such party by
the other party pursuant to this Agreement. Each party agrees
to indemnify and hold harmless the other party for any
liability resulting from such party's nonpayment of such
taxes.
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12. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement represents the
entire agreement of the parties hereto with respect
to the subject matter hereof. Correspondence,
memoranda, notes, discussions, or agreements, whether
written or oral, originating before the date of this
Agreement are replaced in total by this Agreement.
(b) BINDING EFFECT. This Agreement shall be binding upon,
and shall inure to the benefit of, the parties and
their respective legal representatives, successors,
and permitted assigns.
(c) GOVERNING LAW. This Agreement shall be governed by
and construed in accordance with the laws of the
State of Florida. The state courts of Pinellas
County, Florida shall have exclusive jurisdiction
over any judicial proceeding relating to any dispute
out of the interpretation, performance, or breach of
this Agreement.
(d) INTERPRETATION. The language used in this Agreement
shall not be construed in favor of or against either
party, but shall be construed as if both parties
prepared this Agreement. The language used in this
Agreement shall be deemed to be the language chosen
by the parties to express their mutual intent, and no
rule
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of strict construction shall be applied against
either party.
(e) NOTICE. Any notice or other communication which is
required, or which may be given, under this Agreement
shall be in writing and shall be effective upon
actual receipt, except as otherwise provided
hereinbelow. Any such notice or communication shall
be personally delivered or sent by certified mail,
return receipt requested, first class postage
prepaid. In each case, notice shall be given to the
parties at the following addresses:
If to BAC: XXXXX XXXXXXX CELLULAR SYSTEMS OF
FLORIDA, INC.
0000 Xxxx Xxxxxx X.X.
Xxxxx X
Xxxxx, Xxxxxxx 00000
If to Xxxxxxx: Xxxxxx X. Xxxxxxx
000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxx 00000
With a copy to: Xxxxxx X. Xxxxxx, Xx.
0000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Either party may change such party's address for the
purposes of this Agreement by giving written notice
of the new address to the other party in accordance
with one of the mediums described hereinabove.
Rejection of, or any other refusal to accept,
delivery of any notice required or permitted to be
given under this
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Agreement shall cause such notice to be effective
when sent. The inability to deliver any notice
required or permitted to be given under this
Agreement because of a changed address for which no
notice was given shall cause such notice to be
effective when sent.
(f) HEADINGS. The titles and headings of the various
sections of this Agreement are intended solely for
convenience of reference and are not intended to
explain, modify or place any interpretation upon any
of the provisions of this Agreement.
(g) AMENDMENT. This Agreement may be amended only by a
writing signed by both of the parties.
(h) SEVERABILITY. If any part of this Agreement is
determined to be illegal or unenforceable, all other
parts shall be given effect separately and shall not
be affected.
(i) NONWAIVER. No waiver of any provision of this
Agreement, express or implied, shall be valid unless
the same is in writing and signed by the party
against whom it is sought to be enforced. No assent
or waiver, express or implied, of any breach of any
one or more of the covenants, conditions or
provisions of this Agreement shall be deemed a waiver
of any subsequent
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breach, or a waiver of any other covenant, condition
or provision of this Agreement.
(j) ATTORNEY'S FEES. The prevailing party to a dispute
between, or litigation between, the parties, if said
dispute or litigation relates to this Agreement,
shall be entitled to reimbursement from the
non-prevailing party for such prevailing party's
reasonable costs and expenses, including reasonable
attorneys' fees. For purposes of this Agreement, the
"prevailing party" shall be deemed to be that party
who obtains substantially the result sought, whether
by settlement, mediated or otherwise, dismissal, or
judgment. For purposes of this Agreement, the term
"reasonable attorneys' fees" shall include, without
limitation, the actual attorneys' fees incurred in
retaining counsel for advice, negotiations, suit,
appeal, or any other legal proceeding, including
mediation and arbitration.
(k) ADDITIONAL DOCUMENTS. Each party agrees to execute
and acknowledge, if required, any and all other
documents and writings which may be necessary to
carry out the purposes and provisions of this
Agreement.
(l) COUNTERPARTS. This Agreement may be executed in one
or more counterparts, each of which shall be deemed
an
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original, but all of which together shall constitute
one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
date or dates set forth hereinbelow, to be effective for all purposes as of the
Effective Date.
/s/ Xxxxx X. Xxxxxxx /s/ Xxxxxx X. Xxxxxxx
-------------------------- ------------------------------
Signature of Witness Xxxxxx X. Xxxxxxx a/k/a
Xxxxx Xxxxxxx
Xxxxx X. Xxxxxxx Date: 12/31/98
-------------------------- --------------------
Printed Name of Witness
/s/ Xxxxxx X. Xxxxxx, Xx.
--------------------------
Signature of Witness
Xxxxxx X. Xxxxxx, Xx.
--------------------------
Printed Name of Witness
XXXXX XXXXXXX CELLULAR SYSTEMS
OF FLORIDA, INC.
/s/ Xxxx X. Xxxxxx XX By: /s/ Xxxxxx X. XxXxxxxx
-------------------------- --------------------------
Signature of Witness Xxxxxx X. XxXxxxxx
Title: Its Chief Executive Officer
Xxxx X. Xxxxxx XX Date: 12/31/98
-------------------------- -------------------------
Printed Name of Witness
/s/ Xxxxx Xxxxxx
--------------------------
Signature of Witness
Xxxxx Xxxxxx
--------------------------
Printed Name of Witness
/s/ Xxxx X. Xxxxxx XX By: /s/ Xxxxx X. Xxxxx
-------------------------- --------------------------
Signature of Witness Xxxxx X. Xxxxx
Title: Its President
Xxxx X. Xxxxxx XX Date: 12/31/98
-------------------------- -------------------------
Printed Name of Witness
/s/ Xxxxx Xxxxxx
--------------------------
Signature of Witness
Xxxxx Xxxxxx
--------------------------
Printed Name of Witness
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