Agreement

 

                                                                    Exhibit 10.9

 

 

                                                            [LOGO OF STATS INC.]

 

October 7, 2002

 

VIA E-mail: clive@silverstarholdings.com

 

Clive Kabatznik

Silverstar Holdings

dba Fantasy Sports Enterprises

6100 Glades Road

Suite 305

Boca Raton, FL   33434

Tel: 561-479-0040

Fax: 561-479-0757

 

RE:   Agreement   between   SPORTS TEAM ANALYSIS AND TRACKING   SYSTEMS OF MISSOURI,

     INC. ("STATS") and FANTASY SPORTS ENTERPRISES ("FSE")

 

 

Dear Mr. Kabatznik:

 

This   letter   sets   forth the   Agreement   ("Agreement")   between   STATS and FSE,

whereby STATS shall host,   maintain,   manage,   and operate   sports fantasy games

(collectively,   the   "Games") in an online   version on FSE' World Wide Web site,

including      the     following      URL      addresses:      http://fantasycup.com;

http://fantasycup.org;     http://fantasycup.net;      http://fantasystockcar.com;

http://fantasynhra.com; and http://fantasynascar.com (collectively, the "Site").

The parties agree as follows:

 

1.    Performance by STATS.

 

     (a) STATS shall provide all necessary   technical services required to host,

operate, and administer the Games, including but not limited to,

administering all customer interfaces for registrations,   e-mail,   message board

and web reports. A description of the Games and the relevant launch dates is set

forth on   Exhibit A attached   hereto.   STATS   agrees to use its best   efforts to

provide service to FSE error free.   STATS shall correct any errors in accordance

with the Service Level Agreement ("SLA") attached hereto as Exhibit C.

 

     (b) STATS shall license to FSE, on a non-exclusive basis, the use of STATS'

proprietary sports information and data (the "Licensed Information") as required

for use in the Games.

 

     (c) STATS shall host FSE's company email.

 

     (d)   STATS   shall   provide   to   FSE   with   access   to   the   production   and

development software code for the Games and an administrative tool to access all

user   registration   information   including names,   addresses,   phone numbers and

e-mail   addresses.   FSE   shall be   responsible   for all   errors   and/or   damages

resulting from the acts of FSE personnel.

 

     (e) STATS shall provide   personnel to interface with FSE'S customer service

staff to address technical/user experience issues.

 

 

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2.    Performance by FSE:

 

     (a) FSE shall   timely   provide to STATS any   templates,   graphics and other

materials   required   in the   development   of the pages on which the Games   shall

reside.

 

     (b) FSE shall be responsible for all customer contact,   including,   without

limitation,   providing   telephone   and/or email   customer   service,   billing and

collection   matters,   and credit card   processing   and all   associated   fees and

charges.

 

     (c) FSE shall be responsible for the promotion,   marketing, and advertising

for the Games ("Marketing"),   including,   without limitation,   all expenses, and

costs associated with Marketing.

 

     (d) FSE shall acquire any and all necessary   permissions   and licenses from

players, coaches,   drivers,   leagues,   associations or their agents or any other

party   and   pay   any   associated   royalties   required   in   connection   with   the

operation,   marketing,   advertising,   sale, distribution,   or publication of the

Games ("Professional Licenses").

 

     (e) In the event any of the Games shall award   prizes,   FSE shall be solely

responsible   for: (i) obtaining   prizes and satisfying   any   applicable   bonding

requirements;    (ii)   satisfying   any   state,   federal,   or   other   governmental

regulations   regarding   registration of the Games; and (iii) distributing prizes

to the winners. The Site shall contain appropriate language regarding FSE'S sole

responsibility for paying prizes.

 

 

3.    Rights and Licenses.

 

     (a) Ownership by STATS.   FSE hereby   acknowledges   STATS' ownership of: (i)

the Licensed   Information and (ii) STATS'   trademarks,   trade names,   logos, etc

(collectively,    "STATS   Properties").    Nothing   in   this   Agreement   shall   be

interpreted   to   provide   for the   assignment   by STATS to FSE of any of   STATS'

Properties   or   any   of   STATS'   intellectual   property   rights   in   such   STATS

Properties.   Nothing   in   this   Agreement   shall   limit   STATS'   rights   to use,

reproduce,   enhance,   modify,   distribute   and   otherwise   exploit the   Licensed

Information.   Nothing in this   Agreement   shall   restrict   STATS'   rights to use

STATS' Properties.

 

     (b) Ownership by FSE. STATS hereby acknowledges FSE'S ownership of: (i) the

Games (but excluding any STATS' Properties) and that STATS development work with

respect to the Games shall   constitute   "works made for hire" for FSE within the

meaning of the copyright   laws of the United   States and (ii) FSE'S   trademarks,

trade   names,   logos,   etc   (collectively,   "FSE   Properties").   Nothing in this

Agreement   shall be   interpreted   to provide for the assignment by FSE of any of

FSE'S   Properties   or any of   FSE'S   intellectual   property   rights   in such FSE

Properties.   Nothing in this   Agreement   shall   restrict FSE'S rights to use FSE

Properties.

 

     (c)   Non-Exclusive   License.   During the Term, STATS hereby grants to FSE a

non-exclusive,   worldwide   license to   reproduce,   market,   and   distribute   the

Licensed Information solely for use with the Games.

 

4.    Consideration: In consideration for the services performed by STATS for FSE

in connection with this   Agreement,   the parties agree to pay the sums set forth

on Exhibit B attached hereto.

 

 

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5.    Term.   The term of this   Agreement   shall   commence upon its execution (the

"Effective   Date") and shall terminate on October 31, 2003 (the "Term"),   unless

sooner    terminated   as   provided   in   this    Agreement.    The   Agreement   shall

automatically   renew   for a period   of one (1) year   upon   the   same   terms   and

conditions unless either party notifies the other party in writing of its desire

not to renew the Agreement no less than sixty (60) days prior to the   expiration

of the Term.

 

6.    Trademarks, Trade Names and Related Matters.

 

     (a) STATS Name and   Trademarks.   Subject to   approval of such use by STATS,

STATS hereby grants to FSE a non-exclusive license to use STATS' name, logo, and

any other applicable trademarks in connection with Marketing.

 

     (b) FSE's Name and Trademarks.   Subject to approval of such use by FSE, FSE

hereby grants to STATS a non-exclusive   license to use FSE's name, logo, and any

other applicable trademarks in connection with the Games on the Site.

 

     (c) STATS Logo.   The STATS logo shall be displayed on all pages of the Site

that introduce the Games and/or   Licensed   Information.   On pages that introduce

the   Games,   the   logo   shall   be   preceded   by   language   crediting   STATS   and

acknowledging that the Games are "Powered by STATS, Inc." The size and placement

of the STATS logo on the Site shall be   mutually   agreed upon by the parties but

in no event shall the size of the logo be less than 102 x 27 pixels.

 

     (d) STATS   Copyright.   The following   copyright   notice shall appear on all

pages of the Site that   display   the   Licensed   Information:   "Statistical   Data

Copyright   xxxx (where xxxx denotes the current year) by STATS,   Inc. All rights

reserved.   Any   commercial   use or   distribution   without   the   express   written

permission of STATS, Inc. is strictly prohibited."

 

7.    Confidential Information.   The parties agree that during and after the Term

they shall not, except for purposes of this Agreement, use for their own benefit

or for the benefit of any person, firm,   corporation or other entity, any secret

or   confidential    information,    solicitation   methods,    confidential   pricing

information or any other data pertaining to their respective businesses,   or any

affiliates thereof,   their respective financial affairs or any other information

obtained   hereunder   regarding   each   other not   generally   known   within   their

respective   trades,   or as a matter of public   knowledge   or patent,   trademark,

trade name, service mark, copyright or other intellectual   property of the other

except as authorized by this Agreement.

 

8.    Termination.   Notwithstanding   anything in this   Agreement to the contrary,

this Agreement shall immediately terminate (i) upon the insolvency or bankruptcy

of   either   party,   if either   party   makes an   assignment   for the   benefit   of

creditors   or a   receiver,   trustee   or   liquidator   is   appointed   for all or a

substantial   portion   of either   party's   properties   or (ii) upon the breach by

either party of any of their   obligations   under this Agreement   which breach is

not cured within thirty (30) days after written   notice thereof to the breaching

party.

 

 

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9.    Obligations Upon Termination.

 

     (a) Post-Termination   Payments. The termination of this Agreement shall not

relieve   either party of its   obligations to account for and pay sums due to the

other party   hereunder   relating to any period prior to the   termination of this

Agreement.   In addition, if this Agreement is terminated as a result of a breach

hereof by FSE,   the fees set   forth on   Exhibit B shall   accelerate   and   become

immediately due and payable in full to STATS.

 

     (b) Additional   Post-Termination   Obligations.   Following the expiration of

the Term of this   Agreement or the earlier   termination of the Agreement for any

reason,   each party shall   return to the other or shall   destroy all   documents,

material   and   information   with   respect   to any   confidential   or   proprietary

information of the other.   Immediately   upon   destruction of any confidential or

proprietary   information,   FSE/STATS   shall provide   STATS/FSE with an affidavit

signed   by an   officer   or   legal   representative   of   FSE   denoting   the   items

destroyed, the manner of destruction, and the date of the destruction. Upon such

expiration or termination, each party shall cease any and all use, reproduction,

marketing,   and   distribution   of the   trademarks,   trade names,   service marks,

patents or other   intellectual and personal   property of the other. In the event

of termination   of this agreement for any reason,   STATS shall download all game

code and user database   files and other data on the hosted site to a DAT Tape or

CD and deliver such   materials to FSE within 5 business   days.   STATS shall keep

the site   publicly   accessible   for a period   of 14 days   following   the date of

termination of this agreement.   If the transfer   requires a change in the domain

name,   immediately   upon the date that the   hosted   site is no   longer   publicly

accessible,   and for a period of one month thereafter   maintain the hosted sites

URL,   provide   one page that FSE may use to direct   its users to its new   hosted

site or some other URL of FSE's choosing; and if the transfer does not require a

change in the domain name,   cooperate   with FSE in assigning a new IP address to

the domain name as FSE may request and transferring all operations of the hosted

site to new   provider.   On FSE's written   demand within five days   following the

termination   of this   agreement,   STATS shall   maintain one complete   electronic

version   of FSE's   hosted   site and   shall   delete   all   other   versions.,   Upon

notification by FSE to STATS in writing that the transferred   files appear to be

complete,   STATS   shall   delete its final copy of FSE's   hosted site from STATS'

computers.

 

10.   Representations   and Warranties.   Each party represents and warrants to the

other   that it is   authorized   to enter   into this   Agreement   and   perform   its

obligations hereunder. FSE represents that it shall be responsible for obtaining

any and all   Professional   Licenses in connection with the operation of the Site

and FSE's use of the Games and Licensed Information.

 

11.   Disclaimer   of   Implied   Warranties.    EXCEPT   AS   PROVIDED   HEREIN,   STATS

DISCLAIMS   ALL   WARRANTIES   WITH   RESPECT   TO ITS   WORK   UNDER   THIS   AGREEMENT,

INCLUDING WITHOUT LIMITATION, THE WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A

PARTICULAR PURPOSE.

 

12.   Indemnification.   Notwithstanding   anything   contained in this Agreement to

the contrary, the parties hereby agree to defend,   indemnify and hold each other

harmless   from and   against   any and all   claims,   demands,   lawsuits,   damages,

injuries,    losses,    expenses   (including    reasonable   attorney's   fees),   and

liabilities to the extent   resulting from or related to any   third-party   claims

arising out of or relating to any breach by either party of any   representation,

warranty, duty or obligation contained herein.

 

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13.   Relationship   Created. The relationship of the parties created hereby shall

be that of independent contractors and not as partners or joint venturers.

 

14.   Limitation of Liability.   Notwithstanding   anything herein to the contrary,

under no circumstances   shall STATS be liable for any special,   consequential or

incidental damages in connection with its obligations under this Agreement,   and

in any event, the liability of STATS for any act of negligence or breach of this

Agreement   shall not exceed the amount paid by FSE to STATS in   connection   with

this   Agreement   during the twelve (12) month period   immediately   preceding the

date of any claim.

 

15.   Equitable Remedies. In the event of any breach of the provisions of Section

7 hereof, the parties hereto agree that remedies at law will not be adequate and

each shall be entitled,   in addition to damages,   to   preliminary   and permanent

injunctive   relief   (without the necessity of posting of bond) to prevent a then

occurring or an about to occur breach, as well as an equitable accounting of all

profits or benefits arising out of such breach,   which rights and remedies shall

be   cumulative   and in   addition   to any other   rights or   remedies to which the

parties may be entitled.

 

16.   Notices. All notices and other   communications   required hereunder shall be

in writing and deemed to have been given when   personally   delivered,   three (3)

days after being mailed by   certified   mail,   return   receipt   request,   postage

prepaid,   one (1) day after   being sent by Federal   Express or other   nationally

recognized overnight courier with guaranteed next day delivery, or upon delivery

by facsimile with confirmed   receipt and   confirmation   via regular mail, to the

address   or fax   number,   as the case,   may be set forth   below,   or such   other

address   or fax number as either   party may direct by notice   given to the other

party as provided below:

 

If to STATS:

 

Sports Team Analysis and Tracking Systems, Inc.

8130 Lehigh Avenue

Morton Grove, IL   60053

Attn:   Alan Leib

Fax:   (847) 470-9183

 

with a copy to:

 

Sports Team Analysis and Trackin