UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED):
APRIL 11, 2000
GOLFGEAR INTERNATIONAL, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
NEVADA 000-28007 43-1627555
(STATE OR OTHER JURISDICTION OF (COMMISSION FILE NUMBER) (I.R.S. EMPLOYER
INCORPORATION) IDENTIFICATION NUMBER)
12771 PALA DRIVE
GARDEN GROVE, CALIFORNIA 92841-3923
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
(714)899-4274
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
NOT APPLICABLE
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On April 11, 2000, the Company completed the acquisition of certain assets
of Bel Air Golf Companies, which included the "Bel Air Golf" and "Players Golf"
trade names. The acquisition consisted primarily of inventory, trade names,
trademarks, and other intangible assets. A copy of the Amended and Restated
Agreement for the Sale and Purchase of Assets between the Company and Bel Air
Golf Company dated April 11, 2000, is attached hereto as Exhibit "10.1"and
incorporated herein by reference.
The Bel Air Companies offer a full line of junior golf clubs under the
Players Golf brand and Bel Air Golf is known primarily for golf club products
and accessories that offer both value and quality. The Company, through its
wholly owned subsidiary, Bel Air - Players Group, Inc., a California
corporation, will continue to market the line of junior golf clubs under the
name Players Golf and will continue to develop and market other products under
the Players Golf line, the Bel Air Golf line and other trade names acquired.
In consideration for these assets, the Company assumed a liability of
$50,000 and issued 400,000 shares of its restricted common stock. The Company
agreed to issue 255,000 warrants exercisable at $1.00 per share for a period of
six months from closing, 100,000 warrants exercisable at $1.00 per share for a
period of one year from closing, and 100,000 warrants exercisable at $1.00 per
share, 100,000 warrants exercisable at $2.00 per share and 100,000 warrants
exercisable at $3.00 per share, vesting and exercisable only if net revenues
from Bel Air Golf and Players Golf reach $1,500,000, $2,000,000 and $2,500,000
in 2000, 2001 and 2002, respectively. The Company issued 250,000 of the 400,000
shares on November 29, 1999 as an advance, in order to be able to operate the
Bel Air Golf Companies on an interim basis. The Company also issued 10% of the
securities described above as a finder's fee with respect to this transaction.
Payment of consideration hereunder was determined by arms length negotiation
between the parties. Further, there are no material relationships between the
Company or any of its affiliates and Bel Air Golf Company or its officers,
directors or shareholders.
In connection with the agreement to assume liabilities of up to $50,000,
the Company executed an agreement entitled Assumption Agreement and Mutual
Release dated April 24, 2000, which includes a promissory note in favor of U.S.
Precision, Inc. and the Estate of Kunihiko Maemoto, previous creditors of the
Bel Air Golf Companies, and agreed to issue warrants to purchase common stock of
the Company, exercisable at $1.50 per share, which expire March 31, 2003. The
promissory note bears interest at the rate of eight percent (8%) per annum
commencing January 1, 2000, with quarterly interest payments of $1,000, through
March 31, 2003, at which time all principal and unpaid accrued is due and
payable.
The foregoing summary does not purport to be complete and is qualified in
its entirety by reference to the full text of the Amended and Restated Agreement
for the Sale and Purchase of Assets and the Assumption Agreement and Mutual
Release, copies of which are attached hereto as Exhibits 10.1 and 10.2,
respectively.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Financial Statements of Business Acquired
The Company expects that the historical financial
statements of Bel air Golf Company acquired will be filed
by amendment as soon as practicable, but not later than 60
days after this report is required to be filed.
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(b) Pro Forma Financial Information.
The Company expects that the pro forma financial
information for the Bel Air Golf Company acquired will be
filed by amendment as soon as practicable, but not later
than 60 days after this report is required to be filed.
(c) Exhibits
10.1 Amended and Restated Agreement for Sale and Purchase of
Assets between Bel Air Golf Company and GolfGear
International, Inc. dated April 11, 2000.
10.2 Assumption Agreement and Mutual Release dated April 24,
2000, by and between GolfGear International, Inc., U. S.
Precision, Inc. and the Estate of Kunihiko Maemoto.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
GOLFGEAR INTERNATIONAL, INC.
DATE: APRIL 25, 2000 BY:
-----------------------------
DONALD A. ANDERSON, PRESIDENT
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AMENDED AND RESTATED
AGREEMENT
FOR
SALE AND PURCHASE OF ASSETS
BETWEEN
BEL AIR GOLF COMPANY
AND
GOLFGEAR INTERNATIONAL, INC.
APRIL 11, 2000
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AMENDED AND RESTATED AGREEMENT FOR SALE AND PURCHASE OF ASSETS
- -----------------------------------------------------------------------
This Amended and Restated Agreement for Sale and Purchase of Assets (the
"Agreement") is made effective April 11, 2000, between BEL AIR GOLF COMPANY
(sometimes doing business as Bel Air Players Golf hereinafter referred to as
"Bel Air"), a California corporation (hereinafter referred to as "SELLER"), and
GOLFGEAR INTERNATIONAL, INC., a Nevada corporation (the "PURCHASER").
WHEREAS, SELLER is in the business of the manufacture, assembly, repair and
distribution of golf bags, golf clubs and other golf related equipment and
accessories;
WHEREAS, SELLER wishes to sell to PURCHASER, and PURCHASER, through its
wholly owned subsidiary "Bel Air - Players Group, Inc., a California
corporation, wishes to purchase assets of SELLER, relating to SELLER's business;
WHEREAS, on or about June 23, 1999, SELLER entered into an agreement to
sell its business to R&M Golf Co., dba Triumph Golf Co., a Florida corporation
(hereinafter referred to as "Triumph");
WHEREAS, on September 1, 1999, Triumph filed for bankruptcy protection
under Chapter 11 of the United States Bankruptcy Court in the Middle District of
Florida, Case No. 99-07339-6J1 (hereinafter referred to as the "Bankruptcy");
WHEREAS, certain assets of SELLER are in the possession of Triumph and are
currently subject to the Bankruptcy or are otherwise subject to creditor liens.
THEREFORE, THE PARTIES AGREE AS FOLLOWS:
1. SALE OF ASSETS. Except for any assets (including tangibles,
intangibles and potential causes of action) which SELLER may own pursuant to an
agreement entitled "Agreement of Sale of Assets" by and among Laser Golf
Corporation and SELLER, SELLER agrees to sell and convey to PURCHASER, and
PURCHASER agrees to purchase upon execution of this Agreement, the properties,
rights and interests enumerated in Paragraph 2.
2. ASSETS TO BE SOLD. The assets to be conveyed to PURCHASER
("Assets") are:
(1) All SELLER's rights and interest in and to the design of golf
clubs, which shall include technology know-how, copyrights and
all design documentation relating thereto;
(2) All tooling, molds, and dies;
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(3) All inventory on hand, including packaging supplies, as
identified on Schedule 1;
(4) Two (2) trade booths located in Fountain Valley, California, and
Florida;
(5) All office equipment, furniture, computers and supplies as
identified on Schedule 2;
(6) All books, records and customer and supplier lists used in
SELLER's business;
(7) All SELLER's rights and interest in and to patents, trademarks,
likeness of trademarks and trade names, including but not limited
to, the names Bel Air Company, Bel Air Golf Companies, Players,
Players Golf, One Club at a Time, Tour Specs, Pro Image, Hard
Bodies, Clubs for a Lifetime, What's So Hard About Golf, Spin
Touch, Tournament II, Pro Par, Pro Specs, Spinwell, Buckler,
Brandname Manufacturing Warehouse, and any and all other brand
names, trade names, and trademarks, together with their related
logos or other identifying marks, which are used in the sale,
promotion, or licensing of products and services by SELLER or
which relate to the conduct of the business, including SELLER's
rights to any and all registrations of these trademarks and logos
throughout the world, including those listed on the Schedule of
Trademarks and Trade Names attached hereto as Schedule 3 and as
further identified on the Assignment of Trademarks attached
hereto as Schedule 3(a).
(8) Any sales orders pending, rights under contracts, leases;
(9) All inventory relating to golf bags, golf clubs, including "in
process", "finished" and parts thereof;
(10) All machinery and equipment relating to the assembly and/or
shipping of the inventory; and
(11) Retail sales racks.
2. CLOSING DATES. The Closing date for this Agreement shall be
April 11, 2000, or such later day as mutually agreed to in writing by SELLER and
PURCHASER (hereinafter the "Closing").
3. PURCHASE PRICE. In consideration for the sale of the property
described in Paragraph 2, PURCHASER shall deliver to SELLER, after execution of
this Agreement, or shall have previously delivered to SELLER the following:
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a. 250,000 shares of its Common Stock, $.001 par value (250,000
previously issued to SELLER and 25,000 shares previously issued to Dennis Iden
on November 29, 1999) for the right to conduct operations on an interim basis
including the right to utilize existing inventory and the right to service
back-orders utilizing the name "Bel Air" and any of its other trade names or
trademarks, including, but not limited to, "Players".
b. 150,000 shares of its Common Stock, $.001 par value, at Closing.
c. Warrants to purchase 250,000 shares of Common Stock to SELLER and
Warrants to purchase 5000 shares of Common Stock to Dennis Iden, exercisable at
One Dollar ($1.00) per share, which shall expire six (6) months from Closing.
d. Warrants to purchase 100,000 shares of Common Stock, exercisable at
$1.00 per share, for a period of one (1) year from Closing.
e. Warrants to purchase 100,000 shares of Common Stock, exercisable at
One Dollar ($1.00) per share for a period of three (3) years from Closing,
vesting only upon SELLER's business generating net revenue of at least One
Million Five Hundred Thousand Dollars ($1,500,000) during the calendar year
2000.
f. Warrants to purchase 100,000 shares of Common Stock, exercisable at
Two Dollars ($2.00) per share for a period of three (3) years from Closing,
vesting only upon SELLER's business generating net revenue of at least Two
Million Dollars ($2,000,000) during the calendar year 2001.
g. Warrants to purchase 100,000 shares of Common Stock, exercisable at
Three Dollars ($3.00) per share for a period of three (3) years from Closing,
vesting only upon SELLER's business generating net revenue of at least Two
Million Five Hundred Thousand Dollars ($2,500,000) during the calendar year
2002.
All warrants issued hereunder shall not have cashless exercise provisions.
"SELLER's business" shall refer only to sales of the Players division products
made by PURCHASER's subsidiary.
h. PURCHASER shall be obligated to pay or otherwise settle the sum of
no more than Fifty Thousand Dollars ($50,000) when due to U.S. Precision, Inc.,
pursuant to a Settlement and Release Agreement dated June 30, 1999, by and
between Bel Air and U.S. Precision, Inc. Any claims made by U.S. Precision,
Inc. against Bel Air or PURCHASER in excess of Fifty Thousand Dollars ($50,000)
shall be subject to indemnity by SELLER in accordance with Paragraph 6.
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4. SELLER'S REPRESENTATIONS AND WARRANTIES.
a. TITLE TO ASSETS. SELLER represents that it has good and clear
title to all Assets being transferred hereunder and that there are no liens,
encumbrances, security interests, threatened litigation, pending litigation or
any other potential title claims which would affect the Assets in any manner,
except as stated in Paragraph "c" below.
b. SHAREHOLDER APPROVAL. The execution and delivery of this Agreement by
SELLER and the conveyance provided in it have been duly authorized by all
necessary action including, but not limited to, shareholder and Board of
Director approval of SELLER and is a valid and binding agreement on SELLER.
c. OWNERSHIP OF ASSETS. Subject to any Assets which are subject to the
Bankruptcy, SELLER is the owner of the Assets and has full power to transfer the
Assets free and clear of all liens, encumbrances, security interests, equities,
options, claims, charges, and restrictions, except the potential lien arising
out of the Security Agreement by and between Bel Air and Laser Golf Corporation,
for which SELLER agrees to indemnify and hold harmless PURCHASER therefrom.
d. ACTIONS AND PROCEEDINGS. Except for the Bankruptcy, there are no
actions, suits, or proceedings pending or, to SELLER's knowledge, threatened
against SELLER before any court, administrative agency, or other judicial body
affecting or relating to the Assets.
e. TECHNOLOGY KNOW-HOW. SELLER represents and warrants that it is, and
has been, the owner of the technological know-how which is the subject of this
Agreement; that it is the developer of the technology, and that SELLER knows of
no competing patents or copyrights of others which relate to the technology
know-how covered by this Agreement. However, SELLER has not undertaken any
infringement search and, therefore, makes no warranty or representation
concerning the existence of any such patents or copyrights. As used herein,
"technology know-how" shall mean confidential software, documentation describing
hardware and software used by SELLER, for the practice of the design and
manufacture of golf clubs, golf bags and related products, the designs and
operating or manufacturing information on such drawings and related documents,
which SELLER represents are the confidential and proprietary information and
property of SELLER and are subject to copyright protection as unpublished works
under Title 17 United States Code; and all other information of SELLER in
tangible form which is useful or necessary for the practice of design and
manufacture of SELLER's products.
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f. COMPLIANCE WITH LAWS. Neither the execution and delivery of this
Agreement, nor any instrument or agreement to be delivered by SELLER to
PURCHASER pursuant to this Agreement, nor the compliance with the terms and
provisions thereof by SELLER, will result in the breach of any applicable
statute or regulation promulgated thereunder, or any administrative or court
order or decree nor will such compliance conflict with, or result in the breach
of any agreement or other instrument to which SELLER is a party, or by which
SELLER is or may be bound, or constitute an event of default or default
thereunder, or with the lapse of time or the giving of notice or both constitute
an event of default thereunder.
g. REPRESENTATION AND WARRANTIES. No representation by SELLER in this
Agreement or any documents provided hereunder contains or will contain any
untrue statement or omits or will omit to state any material fact necessary to
make the statements contained herein not misleading. All representations and
warranties made by SELLER in this Agreement and any documents provided hereunder
are true and correct.
h. INVESTMENT REPRESENTATIONS. SELLER and SELLER's shareholders
acknowledge that PURCHASER's Common Stock and all stock options as well as the
underlying Common Stock (hereinafter referred to as the "Securities") to be
received in exchange for the sale of SELLER's Assets have not been registered
under the Securities Act of 1933, as amended (the "1933 Act") or qualified under
the California Securities Law of 1968, as amended (the "California Securities
Law") on the grounds that no distribution or public offering of the SELLER's
Securities is to be effected, and that in this connection PURCHASER is relying
in part on the representations of the SELLER set forth herein.
i. SELLER is receiving the Securities for its own account for
investment purposes and not as nominee or agent for any
other persons.
ii. By reason of its business or financial experience and/or by
reason of SELLER's pre-existing relationship with PURCHASER,
SELLER has the capacity to protect its own interests in
connection with the transactions contemplated hereunder and
is able to bear the risks of an investment in PURCHASER.
iii. SELLER has acquired sufficient information about PURCHASER
to reach an informed decision to acquire the SELLER's
Securities.
iv. SELLER represents that it is acquiring the Securities for
its own account for investment purposes and not with a view
to, or for sale in connection with, any distribution thereof
in a manner contrary to Section 5 of the 1933 Act or of the
California Securities Law and Rules and Regulations of the
California Commission of Corporations thereunder.
i. RISKS. SELLER and SELLER's shareholders represent and warrant to
PURCHASER that they are experienced in evaluating and investing in high risk
companies such as PURCHASER and, by reason of their business and financial
experience, have the capacity to protect their own interest in connection with
the transactions contemplated by this Agreement and have the ability to bear the
economic risk of its investments, including those represented by the Securities.
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j. TRANSFER OF SECURITIES. None of the Securities to be acquired by
the SELLER pursuant to this Agreement shall be transferable except upon the
conditions specified in this Paragraph, which conditions are intended to insure
compliance with the provisions of the 1933 Act in respect to the transfer of
such Securities.
i. LEGEND. Unless and until otherwise permitted by this
Paragraph, each certificate or other document evidencing any
of the PURCHASER's Securities shall be endorsed with a
legend substantially in the following form:
"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD,
PLEDGED OR OTHERWISE TRANSFERRED UNLESS (A) COVERED BY AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF
1933, AS AMENDED, (B) IN COMPLIANCE WITH RULE 144 UNDER SUCH
ACT, OR (C) THE COMPANY HAS BEEN FURNISHED WITH AN OPINION
OF COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY TO THE
EFFECT THAT NO REGISTRATION IS REQUIRED BY SUCH TRANSFER."
ii. RESTRICTION ON TRANSFER. None of the Securities shall be
transferred, and PURCHASER shall not be required to register
any such transfer on the books of PURCHASER, unless and
until one of the following events shall have occurred:
(a) PURCHASER shall have received an opinion of counsel, in
form and substance reasonably acceptable to PURCHASER
and its counsel, stating that the contemplated transfer
is exempt from registration under the 1933 Act as then
in effect, and the Rules and Regulations of the
Securities and Exchange Commission (the "Commission")
thereunder. Within ten (10) business days after
delivery to PURCHASER and its counsel of such an
opinion, PURCHASER either shall deliver to the proposed
transferor a statement to the effect that such opinion
is not satisfactory in the reasonable opinion of its
counsel (and shall specify in detail the legal analysis
supporting any such conclusion) or shall authorize
PURCHASER's transfer agent to make the requested
transfer;
(b) PURCHASER shall have been furnished with a letter from
the Commission in response to a written request in form
and substance acceptable to counsel for PURCHASER
setting forth all of the facts and circumstances
surrounding the contemplated transfer, stating that the
Commission will take no action with regard to the
contemplated transfer;
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(c) The Securities are transferred pursuant to a
registration statement which has been filed with the
Commission and has become effective; or
(d) The Securities are transferred pursuant to and in
accordance with Rule 144 promulgated by the Commission
under the 1933 Act.
k. AGREEMENT TO LOCK UP. SELLER and SELLER's shareholders agree that
all Common Stock issued hereunder shall be subject to a restriction on resale
and they further agree not to sell any such Securities for a two (2) year period
from the date of Closing or the date of issuance of the Securities, whichever is
later. After such two (2) year period, SELLER and SELLER's shareholders may
sell such Common Stock, in the aggregate, in an amount not to exceed one percent
(1%) of the outstanding Common Stock of the Company in any given calendar
quarter. Each Common Stock certificate shall bear an appropriate legend to this
effect in addition to any other restrictive legends contained herein.
l. REGISTRATION OF SECURITIES. So long as SELLER or its transferees
shall hold any of the Securities of PURCHASER, PURCHASER agrees that if, at any
time after six (6) months from execution of this Agreement and prior to a date
which is twelve (12) months following the execution, the PURCHASER shall take
action to register any of its Securities under the Securities Act of 1933, as
amended, other than on Form S-8 or Form S-4, it will give SELLER or its
transferees written notice promptly of its intention in that regard, and if
registration, other than on Form S-8 or Form S-4, of any such Securities held by
SELLER or its transferees is then possible under the then applicable laws and
regulations and practices of the Securities and Exchange Commission, and subject
to the approval of the investment banker or underwriter, if any, and if SELLER
or its transferees shall within fifteen (15) days after receipt of any such
notice request PURCHASER to do so, PURCHASER will, at its own expense, take
action to register such Securities which it shall have been requested to
register at the same time, and it will use its best efforts that such
registration of such Securities shall become effective. Commissions and direct
costs of sale by SELLER, if any, shall be paid by SELLER on any of the
Securities it sells through the registration.
m. SALES TAX. SELLER shall be responsible for payment of all sales
tax, if any, associated with the execution of this Agreement and the receipt of
consideration therefrom.
5. PURCHASER'S REPRESENTATIONS AND WARRANTIES. PURCHASER represents
and warrants that:
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a. CORPORATE ORGANIZATION. PURCHASER is a corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada and
is duly qualified to do business in the State of California. If PURCHASER forms
a corporation to take title to certain of the Assets, such corporation will be
duly organized, validly existing and in good standing under the laws of the
State of California and the corporation will have full power and authority to
enter into this Agreement and perform the transactions contemplated herein. The
corporation will be duly qualified to do business in the State of California.
b. BINDING NATURE. This Agreement shall be, when duly executed and
delivered, a legal and binding obligation of PURCHASER, enforceable in
accordance with its terms.
c. REPRESENTATIONS AND WARRANTIES. No representation or warranty by
PURCHASER in this Agreement contains or will contain any untrue statement or
omits or will omit to state a material fact necessary to make the statements
contained herein not misleading. All representations and warranties made by
PURCHASER in this Agreement shall be true and correct as of execution of this
Agreement with the same force and effect as if they had been made on and as of
such date.
d. COMPLIANCE WITH LAWS. Neither the execution and delivery of this
Agreement, nor any instrument or agreement to be delivered by SELLER to
PURCHASER pursuant to this Agreement, nor the compliance with the terms and
provisions thereof by SELLER, will result in the breach of any applicable
statute or regulation promulgated thereunder, or any administrative or court
order or decree nor will such compliance conflict with, or result in the breach
of any agreement or other instrument to which SELLER is a party, or by which
SELLER is or may be bound, or constitute an event of default or default
thereunder, or with the lapse of time or the giving of notice or both constitute
an event of default thereunder.
e. VALID ISSUANCE. The Common Stock to be delivered to SELLER will be,
when issued, duly authorized, validly issued, fully paid and non-assessable.
6. LIABILITIES.
a. NO ASSUMPTION OF LIABILITIES.
i. SELLER acknowledges that PURCHASER is acquiring SELLER's Assets
hereunder without any assumption of SELLER's liabilities except
to the extent herein expressly provided;
ii. SELLER agrees to hold PURCHASER harmless against any and all
claims, demands and expense of any nature relating to any unpaid
liability of SELLER, except that debt expressly assumed pursuant
to Paragraph 3h above existing or arising on or before November
24, 1999, and for any product, service, and professional
liability against PURCHASER arising prior to execution of this
Agreement; and
iii. There are no undisclosed liabilities relating to the Assets other
than as stated in this Agreement or Schedules annexed hereto.
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7. ITEMS TO BE DELIVERED BY SELLER. SELLER hereby delivers to
PURCHASER:
a. TRANSFER DOCUMENTS. Assignments, bills of sale, and such other
instruments in form and substance satisfactory to PURCHASER and to the U.S.
Department of Commerce/Patent and Trademark Office, as are required to grant
PURCHASER title to, or SELLER's interest in, the Assets as provided in this
Agreement.
b. RECORDS, CUSTOMER LISTS AND ACCOUNTING RECORDS. All books, records,
and customer and supplier lists used in SELLER's business; and access to all
accounting records as reflected on Schedule 4.
c. INDEMNIFICATION. SELLER agrees to indemnify and hold PURCHASER
harmless from and against any loss, cost, claim, liability, or expense suffered
or incurred by PURCHASER from and after execution of this Agreement arising from
or connected with SELLER's ownership of the Assets or operation of its business
prior to November 24, 1999.
8. ITEMS TO BE DELIVERED BY PURCHASER. PURCHASER herewith delivers to
SELLER:
a. COMMON STOCK. PURCHASER has delivered to SELLER 250,000 shares of
Common Stock on or about November 29, 1999.
b. FINDER STOCK. In consideration for his efforts in negotiating this
transaction, PURCHASER shall issue to Dennis Iden as a finder an amount equal to
ten percent (10%) of all Securities issued pursuant to Paragraph 2.
c. BROKERAGE. Each party hereto represents and warrants to the other
than no broker is entitled to any commission, or similar fee, in connection with
the making and carrying out of this Agreement.
d. INDEMNIFICATION. PURCHASER agrees to indemnify and hold SELLER
harmless from and against any loss, cost, claim, liability, or expense suffered
or incurred by SELLER arising from the acquisition of the assets and sale of
golf products arising therefrom after November 24, 1999.
9. EFFECTIVENESS. This Agreement supersedes any and all agreements, if
any, both written and verbal, previously made between the parties relating to
the subject matter hereof, and there are no understandings or agreements other
than those included herein.
10. NOTICES AND COMMUNICATIONS. All notices, requests, demands, and
other communications under this Agreement shall be in writing and delivered in
person or sent by certified mail, postage prepaid or by telefax and properly
addressed as follows:
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To the SELLER:
---------------
Dennis Iden
Bel Air Golf Company
2463 Irvine Ave., #E-2
Costa Mesa, CA 92627
Telephone (949)642-7112
Telefax (949)642-9024
To the PURCHASER:
------------------
Donald A. Anderson, President
GolfGear International, Inc.
12771 Pala Drive
Garden Grove, CA 92841
Telephone (714)899-4274
Telefax (714)899-4284
Any party may from time to time change its address for the purpose of
notices to that party by a similar notice specifying a new address, but no such
change shall be deemed to have been given until it is actually received by the
respective party hereto.
11. NON-WAIVER. No delay or failure on the part of either party in
exercising any right hereunder, and no partial or single exercise thereof, will
constitute a waiver of such right or of any other right hereunder.
12. HEADINGS. Headings in this Agreement are for convenience only and
are not to be used for interpreting or construing any provision hereof.
13. PURCHASER'S DESIGNEES. PURCHASER intends to cause a corporation to
be organized prior to the execution of this Agreement to take title to certain
of SELLER's Assets. PURCHASER shall have the right to designate such
corporation as the party to which any of SELLER's Assets shall be conveyed and
transferred by SELLER at the execution of this Agreement, but no such
designation shall relieve PURCHASER of any liabilities and obligations
hereunder.
14. GOVERNING LAW. This Agreement shall be construed in accordance
with and governed by the laws of the State of California against both parties to
this Agreement.
15. INDEPENDENT LEGAL COUNSEL. Each party has had his or its attorney
review this Agreement and/or give advice with respect to, among other things,
the legal, securities and tax consequences of executing this Agreement and the
subsequent transactions contemplated hereunder. Attorney for PURCHASER (Gary C.
Wykidal) does not represent SELLER or SELLER's shareholders and has not given
them legal, securities, tax or any other advice with respect to this Agreement
or the transactions contemplated hereunder.
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16. ARBITRATION. Any dispute arising out of or concerning this
Agreement shall be handled in accordance with the Rules and Regulations of the
American Arbitration Association. Said arbitration shall be held in Orange
County, California and shall be binding. The prevailing party shall be entitled
to, among other relief, attorney fees and costs.
17. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which may be deemed an original, but all of which
together, shall constitute one and the same instrument.
18. BINDING NATURE. The provisions of this Agreement shall be binding
upon and inure to the benefit of each of the parties hereto and their respective
successors and assigns.
19. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Except as otherwise
expressly limited in this Agreement or the Schedules annexed, the
representations and warranties of PURCHASER and SELLER extended hereunder shall
survive for a period of twelve (12) months after the execution of this
Agreement. Each party against whom liability is asserted under the provisions
of this Agreement shall be given the opportunity to participate, directly or
through its authorized representative, at its cost and expense, in the conduct
of any negotiations relating to the settlements of any liability or any other
proceeding instituted by any third party against either SELLER or PURCHASER, as
the case may be, giving rise to the alleged breach.
20. EXPENSES. Except as otherwise expressly provided herein, each
party shall pay all of its own expenses incidental to the negotiation and
preparation of the documentation and financial statements relating to this
Agreement and for entering into and carrying out the terms and conditions of
this Agreement and consummating the transactions, irrespective of whether the
transactions contemplated shall be consummated.
21. AMENDMENT; SUCCESSORS AND ASSIGNS. This Agreement shall not be
altered or otherwise amended except pursuant to any instrument in writing signed
by all of the affected parties hereto. Neither party may assign any of its
rights, obligations, or liabilities arising hereunder without the prior written
consent of the other, except as otherwise provided herein, any such assignment
or attempted assignment shall be null and void.
22. THIRD PARTY BENEFICIARIES. Except for their proper heirs,
successors, and assigns, the parties hereto intend that no third party shall
have any rights or claims by reason of this Agreement.
23. NO FURTHER LIABILITY. Except for any obligation expressly assumed
herein, PURCHASER shall have no further liability to SELLER, to SELLER's
shareholders or to Dennis Iden. Further, this Agreement shall supercede all
prior agreements between the parties, whether written or oral.
11 of 12
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first above-written.
PURCHASER:
GolfGear International, Inc.
-------------------------------
By: Donald A. Anderson
Its: President
SELLER:
Bel Air Golf Company / Players Golf
------------------------------
By: Howard Fletcher
Its: Secretary
MAJORITY SHAREHOLDER APPROVAL
-------------------------------
The aforesaid Amended and Restated Agreement for Sale and Purchase of
Assets between Bel Air Golf Company and GolfGear International, Inc. is hereby
approved by written consent of the undersigned Shareholders, which constitute
approximately ninety percent (90%) of the outstanding voting shares of the
SELLER:
Name: Terry C. Hackett Name: Howard Fletcher
Address: Upper Newport Plaza Dr. Address: 1635 Clark Ave., #107
Newport Beach, CA 92660 Long Beach, CA 90815
Signature: Signature:
---------------------------- -----------------------
Name: Warren Schulten Name: Al Blowers
Address: 500 Ocean Ave . Address: 1100 N. Tustin #102
Seal Beach, CA 90740. . Anaheim, CA 92807
Signature: Signature:
---------------------------- -----------------------
Name: John W. Hancock Name: Dennis Iden
Address: 258 Roycroft Ave. Address: 2463 Irvine Ave. #E2
Long Beach, CA 90803. . Costa Mesa, CA 92627
Signature: Signature:
---------------------------- -----------------------
12of 12
<PAGE>
SCHEDULE 1
INVENTORY ON HAND
-----------------
<PAGE>
SCHEDULE 2
OFFICE EQUIPMENT
----------------
1. Desks (with returns) (3)
2. Tables (2)
3. 2-Drawer File Cabinets (4)
4. 4-Drawer File Cabinet (1)
5. Desk Chairs (3)
6. Supply Cabinet (1)
7. Server with Hub (1)
8. Blue Dividers (5)
9. Epson Color Printer (1)
10. HP Color Printer (1)
11. Microwave (1)
12. Coffee Maker (1)
13. Refrigerator (1)
14. Canon Copy Machine (1)
15. Canon Fax Machine (1)
16. GE 3-Line Telephones (3)
17. Postage Meter (1)
18. Desk Top Computers w/Monitors (5)
19. Desk Top Computers w/Monitors (2) (not working)
20. Lap Top Computer (1)
21. Astra Scanner (1)
22. Logo Glove File Cabinet (1)
23. Lexmark Laser Printer (1)
<PAGE>
SCHEDULE 3
TRADEMARKS AND TRADE NAMES
--------------------------
REGISTERED MARKS
----------------
MARK REG. NO.
- ----- ---------
CLUBS FOR A LIFETIME 2,232,317
ONE CLUB AT A TIME 2,234,290
AIRSOFT 2,182,208
TOUR SPECS 1,945,933
PRO SPECS 1,945,922
SPINWELL 1,930,093
BUCKLER 1,904,538
AIR SOFT I 1,639,829
AIR PRO 1,639,828
BEL AIR 1,549,244
PLAYERS GOLF 1,533,359
PLAYERS 1,465,617
PENDING APPLICATIONS
--------------------
MARK SERIAL NO.
- ----- ---------
HARDBODIES 75/360,848
WHAT'S SO HARD ABOUT GOLF? 75/360,847
UNREGISTERED TRADEMARKS
-----------------------
MARK
- ----
BEL AIR GOLF COMPANY
BEL AIR GOLF COMPANIES
SPIN TOUCH
TOURNAMENT II
BRANDNAME MANUFACTURING WAREHOUSE
<PAGE>
SCHEDULE 3(A)
TRADEMARK ASSIGNMENT
--------------------
WHEREAS, BEL AIR GOLF COMPANY, a California corporation, of 235 East
Gardena Blvd., Gardena, California 90248, is the owner of the below listed
registered trademarks, and has adopted, is using and is the Applicant of the
below listed pending applications for which he has applied for registrations in
the United States Patent and Trademark Office:
MARK REG. NO.
- ----- ---------
CLUBS FOR A LIFETIME 2,232,317
ONE CLUB AT A TIME 2,234,290
AIRSOFT 2,182,208
TOUR SPECS 1,945,933
PRO SPECS 1,945,922
SPINWELL 1,930,093
BUCKLER 1,904,538
AIR SOFT I 1,639,829
AIR PRO 1,639,828
BEL AIR 1,549,244
PLAYERS GOLF 1,533,359
PLAYERS 1,465,617
PENDING APPLICATIONS
--------------------
MARK SERIAL NO.
- ----- ---------
HARDBODIES 75/360,848
WHAT'S SO HARD ABOUT GOLF? 75/360,847
and
WHEREAS, BEL AIR - PLAYERS GROUP, INC., a Nevada corporation, whose address
is 12771 Pala Drive, Garden Grove, California 92841, is desirous of acquiring
said marks and the registrations thereof and/or the portion of the business to
which the marks pertain;
<PAGE>
SCHEDULE 3(A) CONT.
NOW, THEREFORE, for good and valuable consideration, receipt of which is
hereby acknowledged, said corporation, BEL AIR GOLF COMPANY, does hereby assign,
transfer and convey unto the said BEL AIR - PLAYERS GROUP, INC., all right,
title and interest in and to the said trademarks, together with the good will of
the business symbolized by the trademarks and/or the portion of the business to
which the marks pertain, and the registrations thereof.
Dated: BEL AIR GOLF COMPANY
---------------
-----------------------------
By: Howard C. Fletcher
Its: Secretary
<PAGE>
SCHEDULE 4
ACCOUNTANT'S INSTRUCTION LETTER
BELAIR GOLF COMPANIES
---------------------
PLAYERS GOLF(R) BEL AIR(R) LASER GOLF(R)
SENT VIA TELEFAX (714)632-9976
- ---------------------------------
AND U.S. MAIL
- ---------------
Fred Holder
HOLDER & ZIMMERMAN
1100 North Tustin Ave.
Suite 102
Anaheim, CA 92807
Dear Mr. Holder:
Please be advised that Bel Air Golf Company has entered into an agreement,
dated April 11, 2000, entitled Amended and Restated Agreement for Sale and
Purchase of Assets between Bel Air Golf Company and GolfGear International, Inc.
(the "Agreement"), to sell certain assets to GolfGear International, Inc.
("GolfGear"), by and through its subsidiary, Bel Air - Players Group, Inc., a
Nevada corporation. In accordance with the terms and conditions of the
Agreement, you are hereby authorized and instructed to provide access to all
information and accounting records in your files relating to Bel Air Golf
Company that may be requested by GolfGear or its accountants or legal counsel.
Thank you for your assistance in this regard.
Very truly yours,
Howard C. Fletcher, Secretary
<PAGE>
ASSUMPTION AGREEMENT AND MUTUAL RELEASE
---------------------------------------
THIS ASSUMPTION AGREEMENT AND MUTUAL RELEASE ("Agreement") is entered into
by and between GOLFGEAR INTERNATIONAL, INC. (the "Company") on the one hand and
U.S. PRECISION, INC. ("USPI"), NORIKO MAEMOTO and the ESTATE OF KUNIHIKO MAEMOTO
(collectively referred to as "MAEMOTO") on the other hand, on this 24th day of
April, 2000, based on the following recitals, covenants, conditions and
premises.
WHEREAS,on or about October 1, 1999, the Company entered into an agreement
entitled "Agreement for Sale and Purchase of Assets" with Bel Air Golf Company,
which was subsequently amended and re-titled "Amended and Restated Agreement for
Sale and Purchase of Assets between Bel Air Golf Company and GolfGear
International, Inc." dated April 11, 2000 (hereinafter collectively referred to
as the "Asset Purchase Agreement");
WHEREAS, in conjunction with the Asset Purchase Agreement, the Company
agreed to assume no more than Fifty Thousand Dollars ($50,000) of liability in
favor of USPI and Maemoto relating to and arising out of a settlement and
release agreement by and between USPI, Maemoto and Bel Air Golf Companies dated
July 6, 1999;
WHEREAS, the Company wishes to fulfill its obligation under the Asset
Purchase Agreement to Bel Air Golf Company;
NOW THEREFORE, in consideration of the mutual promises contained herein,
and for other good and valuable consideration, receipt of which is hereby
acknowledged, the Parties agree as follows:
1. Incorporation of Recitals. The above-stated recitals and
----------------------------
documents referred to are hereby expressly made a part of this Agreement.
2. Payment by the Company. The Company agrees to pay to USPI and
-------------------------
Maemoto, jointly and severally, the following amounts:
Page 1 of 5
<PAGE>
a. Fifty Thousand Dollars ($50,000) represented by a promissory note
bearing interest at eight percent (8%) per annum, with interest payable
quarterly, all due and payable March 31, 2003, in the form attached hereto as
Exhibit "A". The first interest payment of One Thousand Dollars ($1,000) shall
be due upon execution of this Agreement;
b. Common stock warrants to acquire up to twenty five thousand (25,000)
shares of common stock of the Company exercisable at the price of One Dollar
Fifty Cents ($1.50) per share. This warrant shall expire March 31, 2003.
3. Release. Upon payment of the consideration pursuant to Paragraph
--------
2, including the monies described in subparagraph 2.a above, USPI and Maemoto,
for themselves and each of their respective agents or partners, joint venturers,
subsidiaries, servants, and employees and attorneys, past and present,
successors, heirs, executors, administrators, assigns, transferees, co-owners
and predecessors in interest, and each of them do hereby acknowledge full and
complete satisfaction of, and hereby relieve and discharge the Company and each
of the Company's respective subsidiaries, agents, officers, directors, partners,
joint venturers, distributors, servants, licensees, employees and attorneys,
past and present, successors, heirs, executors, administrators, assigns,
transferees, co-owners and predecessors in interest and each of them from any
and all claims, demands, damages, costs, attorneys' fees, liabilities,
obligations, expenditures, predecessors, rights to arbitration, liens and causes
of action of whatever kind or nature, whether known or unknown, suspected or
unsuspected, which they now own or hold against the company, arising out of, or
in connection with, the subject of this Agreement.
4. Waiver of Section 1542. This is a full and final release
--------------------------
applying to all unknown and unanticipated injuries, expenses, or damages,
arising out of the agreements, dealings or relationships between the various
parties, as well as to those known or disclosed, the undersigned waives all
rights and benefits which the undersigned now has or in the future may have
under the terms of Section 1542 of the Civil Code of California, which Section
reads as follows:
Page 2 of 5
<PAGE>
"A general release does not extend to the claims which the
creditor does not know or suspect to exist in his favor at
the time of executing the release, which if known by him must
have materially affected his settlement with the debtor."
5. Good Faith Settlement. The undersigned understand and represent
------------------------
that this settlement was entered into in good faith and not the result of any
coercion (economic or otherwise) and furthermore there was not threat,
intimidation or other coercion by any party which suggested that the undersigned
would receive more if the case went to trial, but this would take longer and
therefore the undersigned should accept a lessor sum now.
6. No Misrepresentation. The undersigned understands and
----------------------
represents that, no party to this action, misrepresented any fact to the other
party, its attorneys or insurance carrier, nor was any person or party compelled
by any other person and/or party.
7. No Adverse Claims. There are no liens, or claim of liens, or
--------------------
assignments in law or equity, or otherwise, of, or against the claim or cause of
action of the undersigned herein; further, the undersigned is fully entitled to
give this complete release and discharge.
8. Indemnity. The undersigned will indemnify and save harmless the
----------
Parties herein released from any loss, claim, expense, demand or cause of action
of any kind or character through the assertion by any party or stranger hereto
of a claim or claims connected with the subject matter of this Release and from
any loss incurred directly or indirectly by reason of the falsity or inaccuracy
of any representation herein by the undersigned.
9. Entire Agreement. This Agreement contains the entire agreement
------------------
between the Parties hereto. The terms of this Release are contractual and not a
mere recital. The undersigned have carefully read and understands the contents
of this Release, and signs the same as his/her own free act. Each party shall
bear their own costs and attorneys' fees.
Page 3 of 5
<PAGE>
10. Arbitration. In the event any dispute arises with regards to
------------
the interpretation or enforcement of this Release, the Parties agree to handle
said dispute in accordance with the rules and regulations of the American
Arbitration Association. Said arbitration is to be binding upon the Parties.
The prevailing party to such arbitration shall be entitled to costs and
reasonable attorneys' fees.
11. Representation by Counsel. Each Party to this Agreement has been
----------------------------
represented by their own counsel in the drafting, negotiation and review of all
matters that are the subject of this Agreement.
12. Additional Documents. To the extent that it is necessary or
----------------------
appropriate to prepare and execute any additional documents in order to
effectuate this Agreement, the Parties agree to do so in a timely manner.
13. Authority. Any Party signing this Agreement on behalf of an
----------
entity or other than themselves, hereby represents and warrants that such Party
has authority to sign on behalf of the indicated entity.
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement
effective the day and year first above written. The undersigned hereby warrant
that they are legally authorized and entitled to settle and to release every
claim herein released and to give a valid, full and final acquittance therefor.
DATED: April 24, 2000 GOLFGEAR INTERNATIONAL, INC.
By:
------------------------------
Donald A. Anderson
Its: President
DATED: April 24, 2000 U.S. PRECISION, INC.
By:
------------------------------
---------------------------
Its:
-----------------
Page 4 of 5
<PAGE>
DATED: April 24, 2000 THE ESTATE OF KUNIHIKO MAEMOTO
By:
------------------------------
---------------------------
Its:
-----------------
DATED: April 24, 2000 By:
------------------------------
Noriko Maemoto, an Individual
Page 5 of 5
<PAGE>
