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EXHIBIT 10.3
EXCLUSIVE EVENT MANAGEMENT AGREEMENT
This Exclusive Event Management Agreement (the "Agreement") is entered
into by and between the Men's Professional Billiards Tour Association, a
Delaware corporation, with a place of business in Spring Hill, Florida ("PBT"),
and American Professional Billiards, Inc., a corporation ongoing and existing
under the laws of the State of Nevada, with a place of business at Las Vegas,
Nevada ("APB").
WHEREAS, APB is, inter alia, engaged in the business of managing and
organizing of sporting events; and,
WHEREAS, the PBT is the sanctioned association of professional
billiards players; and,
WHEREAS, the PBT organizes and sanctions official tournaments
consisting of professional billiards players, and other billiards-related
events (the "Events"); and,
WHEREAS, the PBT desires that APB provide management, and
organizational services in connection with the Events; and,
WHEREAS, APB desires to so provide management and organizational
services for such Events;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereto hereby agree as follows:
SECTION 1
GRANT OF AUTHORITY
PBT hereby grants APB, and APB hereby accepts, the sole and exclusive
right to organize, market, and otherwise promote and manage the Events
worldwide.
SECTION 2
TERM OF AGREEMENT
The term of this Agreement shall commence on the date hereof, and shall
expire on the fifth anniversary thereof; provided, however, that this Agreement
may be extended for an additional five (5) years at the option of APB.
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SECTION 3
OBLIGATIONS OF APB
3.1 EVENT RELATED OBLIGATIONS
3.1.1 APB shall be responsible for all of the commercial aspects of
the managing, planning and organization of the PBT Events set forth on an Event
schedule to be prepared and communicated to APB sixty (60) days prior to the
commencement of the calendar year in which such Events (the "Scheduled Events")
are to take place. In the event that PBT desires to schedule additional events
within the course of a calendar year other than the Scheduled Events, APB shall
have the right, but no obligation, to manage such Events.
3.1.2 With respect to each Scheduled Event, APB shall procure such
facilities and services as may be reasonably required to conduct any such
Scheduled Event in accordance with the standards and guidelines established by
the PBT, including but not limited to procurement of space, insurance,
personnel other than such personnel required to be provided by the PBT pursuant
to Section 5.2 of this Agreement, accounting and budgeting services, Event
related marketing and advertising, including but not limited to, providing and
positioning of banners, signs, flags, posters and other promotional displays,
commercialization through television contracts and other media outlets.
3.2 NON EVENT RELATED OBLIGATIONS
3.2.1 APB shall develop and implement on a nationwide basis an overall
marketing and advertising concept relating to PBT Events and Professional
Billiards in general. In particular, APB shall prepare and distribute
promotional materials relating to the PBT and its players, including the
production and distribution of a promotional video with the title "Annual
Highlight Film", and, among other things, provide PBT Media Kits, Event
Marketing, and Sponsor Marketing Kits.
3.2.2 APB shall recruit and, subject to PBT's approval in accordance
with Section 6 hereof, contract with corporate and individual Sponsors for
individual as well as for multiple Events, provided, however, that absent the
explicit prior consent in writing of PBT, APB shall not enter into any
negotiation or agreement relating to sponsorship of Events with persons engaged
in the manufacture, distribution, marketing, promotion or advertising of
tobacco products. For the purposes of this Section, APB shall employ a
professional staff in sufficient numbers to accomplish such objective. APB
shall, on a regular basis, report to PBT on its efforts to recruit additional
sponsors, and maintain an
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accurate record of its communications with existing and potential sponsors.
3.2.3 APB shall maintain for the term of this Agreement a Press and
Media capability suitable to handle all public relations issues concerning the
PBT and its Events, and strive towards creating a positive public image of the
PBT and its players.
3.3 FINANCIAL OBLIGATIONS OF APB
In addition to providing, at its own expense, all of the funding
required to carry out its obligations under Section 3.1. hereof, including, but
not limited to, the underwriting of the total budget for the Scheduled Events,
and under Section 3.2. hereof, APB shall furnish all cash and expenses required
for (i) purse moneys, (ii) site procurement expenses (including, but not
limited to, travel and hotel expenses, transportation expenses and meal
expenses), (iii) official staff apparel, and (iv) salaries for tournament
directors and assistant tournament directors.
SECTION 4
COMPENSATION OF APB
4.1 PBT shall compensate APB for its services in connection with
this Agreement as follows:
PBT shall apply (i) all revenues derived from ticket sales,
sponsorship, television rights, fees and commercial sales, and (ii) certain
other revenues from any and each Event as the parties may agree upon from time
to time, to reimburse APB for the actual amounts invested (the "Invested
Amount") by it to produce, market, promote and televise a particular Event. ABP
shall also be entitled to receive from PBT an amount equal to one hundred
percent (100%) (the "Second Return") of the Invested Amount with respect to
such Event in addition to the Invested Amount. In addition, PBT shall pay to
APB fifty percent (50%) of any revenues remaining from a particular Event after
APB has received the Invested Amount and the Second Return.
4.2 In addition to the foregoing, PBT shall have the obligation to
make available any sponsorship monies paid to PBT with respect to any Scheduled
Event to fund the expenses APB would otherwise be required to fund with respect
to Scheduled Events pursuant to Section 3 of this Agreement. APB shall also be
entitled to receive from PBT a commission in the amount of Ten Percent (10%)
for all royalties and licensing fees paid by licensors to PBT as a result of
each and any licensing, royalty, or comparable agreement arranged for by APB
between PBT and third parties.
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SECTION 5
OBLIGATIONS OF PBT
5.1 NON-EVENT RELATED OBLIGATIONS OF PBT
For the term of this Agreement, PBT shall organize, maintain and promote
Professional Billiards as a professional sport in accordance with the highest
standards of ethics and sportsmanship. For this purpose, PBT shall establish,
maintain, and enforce rules of play, a code of conduct, rules of entry for
Events, tournament rules, fee schedules for membership with the various leagues
of the PBT, and any other rules and regulations as may be customary and
reasonably desirable (hereinafter collectively the "Rules").
5.2 EVENT RELATED OBLIGATIONS OF PBT
PBT shall, for each calendar year, establish a schedule of tournaments and
comparable Events, consisting of no less than twelve (12) Events. For each such
Event, PBT shall furnish no less than thirty-two (32) qualified professional
billiards players as competitors, and also players in sufficient numbers for
pre-event promotions. For each such Event, PBT shall furnish a tournament
director, and assistant tournament directors, referees, timekeepers,
statisticians, and such other personnel required for the conducting of the
particular event in accordance with the Rules. PBT shall also establish the
Prize Money Buy Out Formula, and have input on establishing the ticket prices.
PBT shall for each Event provide scorecards and flowcharts, organize the opening
and closing ceremonies, establish an exhibitor floor-plan, a seating diagram,
and a schematic for the display of Banners.
SECTION 6
6.1 Any provision to the contrary set forth in this Agreement
notwithstanding, PBT shall retain the overall control and supervision of the
sports related aspects of any Event and shall have the right to take appropriate
and reasonable steps necessary to protect the integrity of the Professional
Billiards Sport and its players.
6.2 All letters, by telecopy, or other means of delivery, of APB directed
to third parties, or phone calls intended to be made to third parties by APB
must be pre-approved by PBT where the obtaining of such prior approval would not
unreasonably hinder APB's ability to do business. PBT specifically reserves the
right to pre-approve all media-releases, posters, commercials, banners, flyers,
promotional materials and letters, and solicitations disseminated on its behalf
by APB which prior approval will not be unreasonably withheld. APB shall not
enter
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into any sponsorship negotiations or contracts, or distribute any sponsorship
kits relating to approved sponsors, or enter into any agreements with
exhibitors for certain Events without prior explicit approval of PBT which
prior approval will not be unreasonably withheld. APB shall be prohibited from
entering into any negotiations, or contracts relating to television or other
media productions, or disseminate or cause to be disseminated or to be
distributed any media production or programming without obtaining the prior
explicit consent by PBT to do so which prior approval will not be unreasonably
withheld. Similarly, PBT specifically reserves the right to nominate any
tournament director for the Events, and to issue passes granting free admission
to the Events in reasonable numbers.
SECTION 7
PRIOR TERMINATION
7.1 Either party, at its option, may terminate this Agreement with
immediate effect by notice in writing to the other party in the event of:
(i) the insolvency of the other party or the voluntary
institution by the other party of any proceeding under any bankruptcy or
insolvency law, or the involuntary institution against the other party
of any proceeding under any bankruptcy or state insolvency law which is
not vacated within sixty (60) days from the institution thereof; or the
appointment of a receiver or other officer having similar powers for the
other party or its business who is not removed within sixty (60) days;
or
(ii) the other party shall admit in writing its inability to
pay its debts as they mature; or
(iii) any substantial breach by the other party of any
material obligation, warranty or representation pursuant to the this
Agreement that is not remedied within 1) fifteen (15) days after written
notice is given by PBT within seventy two (72) hours following the due
date in the event of any failure of APB to make timely payment for any
of the Purse Moneys or 2) sixty (60) days after written notice is given
to such other party demanding such remedy in the case of any other
substantial breach by APB.
7.2 In addition, PBT, at its option, may terminate this Agreement
with immediate effect, by notice in writing to APB, if any of the following
events shall occur:
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(i) Conviction of APB or of any of APB's directors,
executives or consultants of any crime or violation of law, if in PBT's
opinion, such conviction may adversely affect the conduct of business or
would tend to be harmful to the goodwill of PBT or to the reputation of
the Professional Billiards Sports;
(ii) Any assignment, transfer or delegation, or attempted
assignment, transfer or delegation, by APB, in whole or in part, of this
Agreement, or any interest in this Agreement, or any duty or obligation
under this Agreement, without the prior written consent of PBT.
Any failure to insist upon strict performance of any of the terms of
this Agreement, shall not constitute a waiver of any such breach or any of the
terms of this Agreement. No breach shall be waived and no duty to be performed
shall be altered or modified except by written instrument. One or more waivers
shall not be considered as a waiver of a subsequent or continuing breach of the
same covenant.
SECTION 8
GENERAL PROVISIONS
8.1 Authority to Sign for PBT. APB acknowledges that only the
Commissioner and CEO of PBT is authorized on behalf of PBT to execute this
Agreement or to agree to any variation, modification or amendment of any of its
provisions or to sign any notice of prior termination.
8.2 Variations; Modifications; Amendments. This Agreement may not
be varied, modified or amended except by an express instrument in writing to
that effect signed on behalf of both PBT and APB. Neither a course of
performance nor a course of dealing nor usage of trade shall be used to
interpret, construe, qualify, explain or supplement any of the provisions of
this Agreement.
8.3 Entire Agreement. This instrument contains the entire
agreement between the parties with respect to the subject matter hereof and
terminates and supersedes, as of the beginning of its term, all prior
agreements, if any, written or oral, between the parties with respect to such
subject matter. No representations or statements other than those expressly set
forth herein were made by PBT or relied upon by the parties in entering into
this Agreement the parties.
8.4 Binding Effect. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
permitted assigns. This Agreement is not intended, and shall not be deemed, to
create or confer any right or interest for the benefit of any person or not a
party hereto.
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8.5 AGREEMENT NONTRANSFERABLE. No part of this Agreement, no interest
in this Agreement and no duty or obligation under this Agreement may be
assigned, transferred or delegated by APB without the prior written consent of
PBT.
8.6 NOTICES. Notices permitted or required to be given under this
Agreement shall be deemed sufficient if given (i) by registered or certified
air mail, postage prepaid, return receipt requested, addressed to the
respective addresses of the parties as first above written or to such other
addresses as the respective parties may designate for themselves by like notice
from time to time, or (ii) by telefax and confirmed by telephone to the telefax
and telephone numbers set forth below or to such other telefax or telephone
numbers as the respective parties may designate for themselves by like notice
from time to time. If given by mail, notices shall be effective upon receipt by
the party to which notice is given, or on the fourteenth day following the date
such notice was posted, whichever occurs first. If given by telefax and
confirmed by telephone, notices shall be effective the next business day after
receipt.
Telefax and Telephone Numbers:
APB: American Professional Billiards, Inc.
1700 East Desert Inn Road, Suite 108
Las Vegas, Nevada 89109
Attn: Mr. Robert M. Stander,
Chairman of the Board
Tel.: (702) 893-1277
Fax : (702) 893-3884
PBT: Professional Billiards Tour Association
10579 Hearth Road
Spring Hill, Florida 34608
Attn: Mr. Donald E. Mackey,
Commissioner
Tel.: (352) 688-5837
Fax : (352) 686-5515
8.7 WAIVERS. The waiver by either party of any breach or violation of
or default by the other party under any provision of this Agreement will not
operate as a waiver of such provision or of any subsequent breach or violation
thereof or default thereunder.
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8.8 Applicable Law and Jurisdiction. The substantive law of the State of
Nevada, without regard to principles of conflicts of law, shall be applicable to
this Agreement and all transactions of PBT with APB, their construction,
interpretation, effect, performance or non-performance, or the consequences
thereof. For all disputes or controversies which may arise between PBT and APB
out of or in connection with this Agreement or any transaction of PBT with APB,
or the construction, interpretation, effect, performance or non-performance of
this Agreement or any such transaction, or the consequences thereof, each of the
parties hereby irrevocably consents to the exclusive jurisdiction of the courts
located in the State of Nevada.
8.9 Divisibility. If any provision of this Agreement should be held
invalid or unenforceable for any reason whatsoever or to violate any law of the
Territory or any political subdivision thereof, this Agreement is to be
considered divisible as to such provision, and such provision is to be deemed
deleted from this Agreement or, in the event that it should be held to violate
only the laws of a political subdivision of the Territory, to be inapplicable
within such political subdivision, and the remainder of this Agreement will be
valid and binding as if such provision were not included in this Agreement or as
if it were included in this Agreement only with respect to areas outside of such
political subdivision, as the case may be.
8.10 Titles. The titles appearing at the beginning of the Articles and
paragraphs of this Agreement have been inserted for convenient reference only
and do not in any way affect the construction, interpretation or meaning of the
text.
Dated: as of June 3, 1996
AMERICAN PROFESSIONAL BILLIARDS, INC.
By:
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Robert M. Stander, Chairman, CEO
PROFESSIONAL BILLIARDS TOUR ASSOCIATION
By:
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Donald E. Mackey, Commissioner
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