Sample Business Contracts

Sublicense Agreement - Entertainment Management Services Inc. and DBD Management Inc.

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                              SUBLICENSE AGREEMENT

         THIS AGREEMENT, made and entered into this ______ day of _____________,
2004, by and between ENTERTAINMENT MANAGEMENT SERVICES, INC., a New York
corporation with its principal office at 533-535 West 27th Street, New York,
New York 10001, or designee ("Licensor"), and DBD MANAGEMENT, INC. ("Licensee").

                               W I T N E S S E T H

         WHEREAS, Licensor is the exclusive owner of the right to sublicense the
SCORES Trademarks and related intellectual property listed on Exhibit "A" (the
"Scores Trademarks"), and has the right to sublicense the same on the terms set
forth herein; and

         WHEREAS, Licensee is the owner and operator of a premium
adult-entertainment nightclub located at 3411 North Federal Highway (the
"Location"), which will conduct business under the name "Scores Ft. Lauderdale";

         WHEREAS, Licensee hereby will receive the right and license to use the
Scores Trademarks in connection with the operation of the Location, and the sale
of certain merchandise, for the Term (as defined below) (the "Business");

         NOW, THEREFORE, for and in consideration of the promises, covenants and
agreements contained herein, and for other good and valuable consideration,
receipt of which hereby is acknowledged by both parties, the parties agree as


         a.   Business. Licensor hereby grants to Licensee and Licensee accepts,
              a non-exclusive (except as provided in subparagraph (c) below)
              license to use the Scores Trademarks during the Term in connection
              with the Business subject to the terms and conditions of this
              License Agreement. Licensor hereby grants to Licensee and Licensee
              accepts, an exclusive lease of, and license to the
     URL for the website for the Business.

         b.   Merchandising. Licensor hereby grants to Licensee, on the terms
              and conditions set forth herein, a non-exclusive (except as
              provided in subparagraph (c) below) license during the Term to use
              the Scores Trademarks in connection with the retail sale of
              commercial merchandise, including tee-shirts, sweat shirts, sweat
              pants, jackets, baseball hats, key rings and other similar
              merchandise, all to be sold at and out of the Business, including
              the right to sell any merchandise utilizing the Scores Trademarks
              relative to the Business over the Internet on a site maintained by
              the Business and by mail order, catalogue or at any other location
              or in any other channel specific to the Business, provided
              further, that Licensee will purchase all merchandise from Licensor
              at cost plus a twenty-five percent (25%) markup, but not more than
              what the Licensee currently pays for similar products.

         c.   Licensee shall have exclusivity within twenty (20) miles of the
              Location in Ft. Lauderdale, Licensor will not open any adult
              entertainment nightclub, or license use of the Scores Trademarks
              to any other person or entity, within a twenty (20) mile radius of
              the Location.

         d.   Nothing contained herein shall prohibit Licensee from advertising
              its location throughout the State of Florida, the United States,
              and the world.

2.       ROYALTIES:

         a.   AMOUNT. Beginning on the one hundred and twenty-first day (121st)
              day of the first day of operation as SCORES-Fort Lauderdale, the
              Licensee agrees to pay four and 99/100 percent (4.99%) of the
              gross revenues of Licensee earned at the location during the term
              hereof, above two hundred and fifty thousand dollars ($250,000.00)
              per month (cumulative). After the 121st day, however, the minimum
              payment per month shall be four thousand dollars ($4,000.00).
              Gross Revenues shall mean one hundred percent (100%) of Licensee's
              receipts received from the Business operation, less all actual
              local sales taxes paid, and amounts specifically designated by
              customers on credit card receipts as "tips for service", credit
              card discount fees, complementary food and beverage sales. Gross
              Revenues include all revenues from operation of the Business,
              including, but not limited to, liquor revenue, beer revenue,
              champagne revenue, shot girl house fees, wine revenue,
              non-alcoholic beverage revenue, food revenue, party revenue,
              admission fees club, admission fees private revenue, candy
              revenue, concession-cigarette, concession-bathroom,
              concession-massage, concession-tarot, dressing room rent, house
              fees-entertainers, house fees-DJ's, house fees-floor manager,
              house fees-service personnel, feature-calendar, feature-novelty,
              feature-video, feature-cigar and internet revenue, and also will
              include the fee charged to customers for the purchase of Diamond
              Dollars (r) and the fee paid by entertainers for cashing in
              Diamond Dollars (r).

         b.   MERCHANDISE ROYALTIES. Licensee will purchase all re-sellable
              Merchandise from Licensor, or Licensor's authorized affiliate.
              Licensee will pay for all such Merchandise on a cost plus
              twenty-five percent (25%) markup basis, unless otherwise agreed,
              but not more than what the current Licensee pays for similar


         c.   ROYALTY REPORTS. Licensee shall furnish Licensor with written
              reports describing in detail all sales relative to the Business.
              The reports shall be prepared and sent to the Licensor not later
              than seven (7) days following the fifteenth (15th) and last day of
              each month. Reports will be adjusted on a quarterly basis (if
              necessary), not later than ten (10) days after each calendar
              quarter period ending in March, June, September and December of
              each year.

         d.   PAYMENT. Payment of royalties due under this Paragraph shall be
              made within ten (10) days of the issuance of each royalty report
              set forth above. Payment for merchandise will be under Licensor's
              standard merchandise sale and payment terms.


         In order to preserve the value, goodwill and reputation of the SCORES
         Trademarks, Licensee and Licensor shall consult each other during the
         Term hereof with regard to any marketing, advertising, or promotional
         activities pursuant to the Business, and Licensor will have the right
         to approve all advertisements, promotional, marketing, and other
         similar materials, including, but not limited to the images and format
         of Diamond Dollars (r) for the Location. Furthermore, prior to
         releasing or using any promotional, marketing advertising or other
         similar materials which not been approved by Licensor in the
         twenty-four (24) month period preceding the proposed use, or in the
         event Licensee intends to utilize any such materials which have been
         used in the past twenty-four (24) months but intends to do so in a
         media not used by Licensor in the twenty-four (24) month period
         preceding the proposed use, Licensee first shall obtain the prior
         written consent of Licensor for such use, which shall not be
         unreasonably withheld. In connection with obtaining such consent,
         Licensee shall send copies of all materials and media for proposed use
         so that Licensor can evaluate thoroughly the proposed use. Licensor
         agrees to inform the Licensee of its decision regarding any approvals
         within twenty-four (24) hours of receiving all materials and media for
         approval. The failure to receive notice from Licensor that it objects
         to such materials in media shall be deemed its approval. Licensor also
         will have general approval over the continuing operations of the
         Business so as to preserve the value, goodwill and reputation of the
         SCORES Trademarks, but will have no control over day-to-day operating
         or hiring and firing, and will not do anything that violates the Lease
         Agreement with M.J. Peters.


         Licensee is responsible for the compliance with all applicable laws and
         safety standards regarding the operation of the Business, the Location
         other licensed locations and the use of the SCORES Trademarks herein.
         Licensor's approval of submissions pursuant to Paragraph 3 above in no
         way affects, alters, diminishes or waives Licensee's obligations
         hereunder, or under Licensee's obligation to indemnify Licensor as set
         forth herein below.


         Licensee shall, for a minimum of three (3) years from their rendition,
         keep full and accurate books of account, records, data and memoranda
         representing Licensee's sales. Licensee further gives Licensor the
         right, at its own cost and expense, to examine said books and records
         on reasonable notice, such examination to be conducted in such a manner
         as to not unreasonably interfere with the business of Licensee.
         Licensee shall reasonably cooperate with Licensor in the event the
         owner of the SCORES Trademarks requests an audit. Licensor or its
         representatives shall not disclose to any other person, firm, or
         corporation any information acquired as a result of any examination,
         provided, however, that nothing contained herein shall be construed to
         prevent Licensor and/or its duly authorized representatives from using
         or disclosing said information in any court, arbitration or other
         action instituted to enforce the rights of Licensor hereunder.


         All copyrights, trademarks and/or patents in the SCORES Trademarks and
         related intellectual property belong solely to Licensor and are within
         the scope of the license granted herein. Upon termination of this
         Agreement, all intellectual property rights and rights granted herein
         in the SCORES Trademarks immediately revert to Licensor or the owner of
         the SCORES Trademarks, and Licensee agrees to return to Licensor all
         original artwork, models, samples, prototypes, renderings and drawings
         incorporating the SCORES Trademarks. All use by Licensee of the
         intellectual property rights of the SCORES Trademarks shall inure to
         the sole benefit of Licensor and the owner of the SCORES Trademarks.
         Licensee shall execute any and all documents necessary to confirm said
         reversions of rights and hereby appoints Licensor its attorney-in-fact
         to execute any such documents in the event Licensee is unwilling or
         unable to do so. Licensee acknowledges the exclusive ownership of all
         intellectual property rights in and to the SCORES Trademarks by the
         owner of the SCORES Trademarks, and will not take any action to
         interfere with or challenge said ownership, including but not limited
         to registering or attempting to register the same or similar marks or
         properties anywhere in the World, nor commence nor participate in
         cancellation or opposition proceedings. 1. WARRANTY:

         a.   Licensor hereby warrants that, to the best of its knowledge, the
              granting of the license hereunder or the subsequent commercial
              exploitation of the license does not violate the intellectual
              property or contract rights of any third party. Licensor further
              warrants that it has not violated intentionally the rights of any
              third party on granting Licensee this license.



         Licensee agrees to give Licensor prompt notification of any third
         party's actions which would constitute an infringement of the rights
         granted to it by this Agreement. Licensor shall prosecute, at its own
         discretion, infringement actions against any third party infringers,
         and any recoveries obtained therein shall belong exclusively to
         Licensor. Licensee shall, at Licensor's expense, cooperate in all
         respects with Licensor's prosecution of said suits, including but not
         limited to being named as a party in any such suit, producing
         documents, appearing as witnesses, etc.


         a.   Licensor agrees to indemnify and hold harmless Licensee from and
              against any and all damage, loss, and expense incurred as a result
              of the breach of any of Licensor's warranties herein. This
              indemnification shall become operative only after a final
              judgment, ----- order or decree is issued which contains a finding
              that Licensor intentionally infringed upon the rights of a third
              party. Any claims made against Licensee which would result in
              Licensor's becoming obligated to indemnify Licensee hereunder
              shall not permit Licensee to withhold any amounts due Licensor

         b.   Licensee agrees to indemnify, defend and hold harmless Licensor,
              its agents and employees from and against any and all loss and
              expense arising out of any claims of personal injury, product
              liability, wrongful death, negligence, strict liability or other
              similar action, in addition to the breach of any of its warranties
              hereunder or the violation of any applicable law or safety
              standard based on the use of the SCORES Trademarks by or on behalf
              of Licensee and/or its subsidiary, affiliated, controlled company.
              Licensee shall maintain, at its sole cost and expense, premises
              liability, liquor liability, workers' compensation (in the amount
              required by the State of Florida, plate glass insurance (as per
              Licensee's Lease), commercial liability coverage and other
              customary insurance. The premises, commercial, and liquor policies
              must provide coverage of at least $3,000,000/$3,000,000, naming
              Licensor as an additional insured, and providing that such policy
              cannot be canceled without thirty (30) days prior written notice
              to Licensor. In the event any claim is made against Licensor in
              excess of the limits of Licensee's insurance set forth above,
              Licensor may, at Licensee's expense, retain counsel of its own
              choosing to defend said claims. All insurance shall be primary and
              not contributory. Licensee agrees to provide Licensor with a copy
              of the insurance declarations and/or certificates within twenty
              (20) days following the date of this Agreement. This
              indemnification shall become effective operative only after a
              final judgment, order or decree is issued which contains a finding
              that Licensee was liable or responsible of the alleged actions or
              inactions. Any claims made against Licensor which result in
              Licensee's becoming obligated to indemnify Licensor hereunder,
              shall not permit Licensor to withhold any payments due hereunder.


         a.   In case either party fails to perform under or commits or allows
              to be committed a breach of any of the several covenants and
              conditions herein contained, the other party shall notify such
              party in writing of such failure or default, and such party then
              shall have the right to remedy such failure or default within
              thirty (30) days. If the default has not been cured within said
              thirty (30) days of notice to the defaulting party, then the
              aggrieved party may terminate this Agreement immediately by a
              further notice in writing. If Licensor shall send notice of
              default to Licensee based on a failure to pay royalties, then
              Licensee shall cure such default within ten (10) days of notice.

         b.   Any termination under this Paragraph will be without prejudice to
              the rights and remedies of either party with respect to any
              provisions or covenants arising out of breaches committed prior to
              such termination.

         c.   If a petition in bankruptcy is filed by or against Licensee or
              Licensor, or Licensee or Licensor becomes insolvent, or makes an
              assignment for the benefit of creditors, or any other arrangement
              pursuant to any bankruptcy law, or if Licensee or Licensor
              discontinues its business or if a receiver is appointed for it or
              its business, to the fullest extent permitted by law at the time
              of the occurrence, the license hereby granted shall terminate
              automatically without any notice whatsoever being necessary. In
              the event this license is so terminated, Licensee, its receivers,
              representatives, trustees, agents, administrators, successors,
              and/or assigns shall have no right to sell, use, exploit or in any
              way deal with or in the SCORES Trademarks or anything relating to
              it whatsoever except with and under the special consent and
              instructions of Licensor in writing, which they shall be obliged
              to follow.

         d.   Upon cessation of all business operations by the Licensee at the
              Location for a period of greater than one hundred eighty (180)
              days for any reason other than Force Majeure, this Agreement shall
              terminate automatically.

         e.   Beginning with January 2005, the Licensee may, in its sole
              discretion, terminate this Agreement, if it fails to earn and
              receive $720,000.00 of net operating profit in any year. Licensor
              may, at its option, make up the difference between the net
              operating profit and $720,000.00 to cure this default.

         f.   This agreement shall also terminate should Licensee sell the
              business or the assets of the business. Upon such a termination,
              Licensee shall give Licensor at least sixty (60) days advance
              written notice. Upon such sale, all rights and obligations of the
              parties relative to this agreement shall cease and be of no
              further force or effect.

11.      TERM:

         Subject to Paragraph 10, the Term of this Agreement shall commence on
         the date first written above and will continue for a united period of
         ten (10) years. The term may be renewed by Licensee for another ten
         (10) years by serving written notice at least six (6) months prior to
         the end of the first term.


         It is expressly agreed and understood that neither party hereto is the
         agent or legal representative of the other and neither party has the
         authority, express or implied, to bind the other or pledge its credit.
         This Agreement does not create a partnership or joint venture between
         the two parties.


         It is understood and agreed that in the event of an act of the
         government, war, fire, flood or other natural disaster, or labor or
         manufacturing strikes which prevent the performance of this Agreement,
         such nonperformance will not be considered breach of this Agreement,
         and such nonperformance shall not be excused while, but no longer than,
         the conditions described herein prevail. The period of Force Majeure
         shall not exceed twelve (12) months.


1.       NOTICES:

         All notices, whenever required in this Agreement, will be in writing
         and send by certified mail, return receipt requested to the addresses
         set forth above. Notices will be deemed to have been given two (2)
         business days following mailing. A copy of all notices to Licensor
         shall be sent via regular mail to: .


                  This Agreement shall be construed in accordance with the laws
                  of the State of Florida, United States of America, and
                  jurisdiction over the parties and subject matter over any
                  controversy arising hereunder shall be in the Courts of the
                  State of Florida, County of Broward, or the Federal courts
                  therein. Both parties hereby irrevocably consent to said
                  jurisdiction and venue.

1.       ASSIGNMENT:

         This Agreement shall be binding upon and inure to the benefit of the
         parties hereto and their respective successors and permitted assigns,
         but neither this Agreement, nor any of the rights, interests, or
         obligations hereunder shall be assigned by Licensee without the prior
         written consent of Licensor, and any attempts to do so without the
         consent of Licensor shall be void and of no effect.


         This writing constitutes the entire agreement and understanding between
         the parties. No other oral or written agreements or representations
         exist or are being relied upon by either party, all being merged
         herein. Any modifications or additions hereto must be made in writing
         and signed by both parties.


         a.   The Paragraph headings used herein are for reference purposes only
              and do not affect the meaning or interpretation of this Agreement.
              If any provisions of this Agreement are for any reason declared to
              be invalid or illegal, the remaining provisions shall not be
              affected thereby.

         b.   The failure of either party to enforce any or all of its rights
              hereunder as they accrue shall not be deemed a waiver of those
              rights, all of which are expressly reserved.

         c.   This Agreement may be executed in more than one counterpart, all
              of which shall be deemed to be originals.



         a.   In order to induce Licensor to enter into this Agreement and to
              secure the complete and timely performance of Licensee's
              obligations hereunder, Licensee hereby grants to Licensor a
              security interest in the license granted under this Agreement.

         b.   Licensee agrees to execute any and all documents necessary to
              perfect Licensor's security interest in this license including,
              but not limited to, Financing Statement Form UCC-1 and any other
              security agreements and financing statements evidencing said
              security interests in such form as may be recorded and perfected
              according to the laws of the State of Florida and the U.S. Patent
              and Trademark Office.

         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.


BY:                                       BY:
   -----------------------------------       -----------------------------------
       Licensor                                  Licensee

TITLE:                                    TITLE: