License of Apparel Business - On March 8, 1999, the Company and Marker
Ltd., entered into a license agreement granting Ski & Sports Recreation Company,
L.L.C. ("SSRC") an exclusive, worldwide right to manufacture, market and sell
the Company's clothing, gloves and luggage products (the "Apparel Business")
utilizing the Marker tradename in return for royalty payments equal to a
percentage of net sales which ranges from 3% to 5%. The initial term of the
agreement is from April 1, 1999 through March 31, 2009 and is automatically
extended for additional one year periods unless sooner terminated by either
party in accordance with the agreement. The Company has the right to terminate
the license agreement in the event annual sales fall below a certain level. In
addition, the Company has an option for the 24 month period commencing on April
1, 1999 and ending on March 31, 2001 to acquire by assignment all of the rights
of SSRC under the license agreement for a formula price based upon earnings
before interest and taxes as set forth in the Option and Right of First Refusal
Agreement dated March 8, 1999 between the Company and Marker Ltd. and SSRC.
Further, the Company has a right of first refusal through March 31, 2002 as to
any sale or transfer of the business and assets used by SSRC for the
manufacture, sale and marketing of the Apparel Business. In connection with the
license agreement, SSRC agreed to purchase certain assets of Marker Ltd. for
$859,000, of which $450,000 was paid at closing, $204,500 is due on July 10,
1999 and $204,500 is due on August 31, 1999. With respect to certain Olympic
inventory, SSRC agreed to pay 60% to 75% of the net sales price to the Company
as the sales price is received.
Since the dogs were bathed and the Christmas ornaments removed from between Sybil's hind legs, Ben has become obsessed with her.
Like I don't have eneough to do. |
