(Houston)

 

SCORES TRADEMARK LICENSE AGREEMENT

 

THIS AGREEMENT (the “Agreement”) is made and entered into this [14] day of
[February] 2014 (the “Effective Date”) by and between SCORES LICENSING CORP., a
Delaware corporation, with its principal office at 617 11th Avenue, New York, NY
10036 (“SLC”) and [Houston KP LLC], a [Domestic Limited Liability Company], with
its principal office at 6340 Westheimer Road Houston, Texas 77057] (“Licensee”).

 

WITNESSETH:

 

WHEREAS, SLC is the authorized licensee of the SCORES trademarks listed on
Schedule A hereto, which may be amended from time to time by SLC in its sole
discretion, by providing Licensee with written notice of such changes
(collectively, the “SCORES Trademarks”);

 

WHEREAS, Licensee is the owner and operator of an adult entertainment night
club/restaurant to be located at 6340 Westheimer Road, Houston, Texas 77057(the
“Location”) which will open to the public and be fully operational no later than
six (6) months from the Effective Date (the “Business”);

 

WHEREAS, Licensee wishes to operate the Business under the name “SCORES” and to
otherwise brand the Business with the SCORES Trademarks, and to offer and sell
various related licensed products at the Location under the SCORES Trademarks;
and

 

WHEREAS, SLC wishes to license the SCORES Trademarks to Licensee for use in
connection with the Business pursuant to the terms and conditions of this
Agreement.

 

NOW, THEREFORE, for and in consideration of the promises, covenants, and
agreements contained herein, and for other good and valuable consideration,
receipt of which is hereby acknowledged, SLC and Licensee (the “Parties”) agree
as follows:

 

1.LICENSE GRANT.

 

(a)Business. Subject to the terms and conditions of this Agreement, SLC hereby
grants to Licensee, and Licensee hereby accepts, an exclusive, non-transferable,
non-sublicenseable sublicense during the Term of the Agreement, as specified in
Section 15 below, to use the SCORES Trademarks at the Location (the “Territory”)
solely to promote, market and otherwise brand the Business (the “Club License”).

 

 

 

 

(b)Licensed Products. Subject to the terms and conditions of this Agreement, SLC
hereby grants to Licensee a non-exclusive, non-transferable, non-sublicensable
sublicense during the Term to use the SCORES Trademarks solely on or in
association with the offering for sale and sale of licensed products as
identified on Schedule A, which may be amended from time to time by SLC in its
sole discretion, by providing Licensee with written notice of such changes
(collectively, the “Licensed Products”) at the Location only (the “Merchandise
License”). The Merchandise License does not grant to Licensee the right to
produce, manufacture or have manufactured the Licensed Products. Nothing in the
Merchandise License restricts SLC or its licensees from offering for sale or
selling Licensed Products in or outside of the Territory. The Club License and
the Merchandise License shall hereinafter be referred to collectively as the
“Licenses”. The Licenses are granted subject to any previous licenses granted by
SLC or SLC’s parent or affiliates prior to the Effective Date.

 

(c)License Restrictions. All rights in and to the SCORES Trademarks not
expressly licensed to Licensee pursuant to the Licenses herein are expressly
reserved by and for SLC and Scores Holding Company, Inc., which has licensed the
SCORES Trademarks to SLC and which is the owner of the SCORES Trademarks (the
“Owner”). At no time shall Licensee use or otherwise exploit any of the SCORES
Trademarks except as expressly provided in this Agreement. Without limiting the
generality of the foregoing, SLC expressly reserves the right to sell, or enter
into license agreements with other parties to sell, merchandise directly to any
retail consumer by means of the Internet or other means of e-commerce or by
catalog, direct mail, or by other similar means. Retail sales include retail
sales in any authorized store.

 

2.ROYALTIES AND OTHER PAYMENTS.

 

(a)Royalty Amount. Licensee shall pay SLC a fixed fee of Ten Thousand Dollars
($10,000.00) per month (“Fixed Fee Royalty”) to be received by May 31, 2014.
Please note SCORES™ will give SCORES Houston a $2,500 advertising allowance paid
upon clearing of monthly $10,000 fee. This arrangement will be for the first 24
timely payments being current. Commencing on July 31, 2014, Licensee shall pay
the Fixed Fee Royalty for two (2) consecutive years, and after such two-year
period, for the remainder of the Term, Licensee shall pay SLC, on a monthly
basis, the greater of 4.99% of Licensee’s monthly Net Revenue (as hereinafter
defined) (the “Net Revenue Royalty”) or the Fixed Fee Royalty (collectively, the
“Business Royalties”). “Net Revenue” means 100% of Licensee’s receipts received
in connection with the operation of the Business (“Gross Revenues”), less all
actual local sales taxes paid, amounts specifically designated by customers on
credit card receipts as “tips for service”, credit card discount fees, and
complementary food and beverage sales (not to exceed 5% of Licensee’s Gross
Revenues). 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 for private or VIP
rooms, room rental, humidor revenue, cigar revenue, cigarette revenue, candy
revenue, novelty revenue (other than revenue from Licensed Products), valet
revenue, coat check revenue, concession—cigarette, concession—bathroom,
concession—massage concession—tarot, dressing room rent, house fees from
entertainers, house fees from DJs, house fees from floor manager, house fees
from service personnel, feature calendar, feature-novelty, feature-video,
feature-cigar and Internet revenue and will also include the fee charged to
customers for the purchase of Diamond Dollars™ and the fee paid by entertainers
for cashing in Diamond Dollars™.

 

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(b)Licensed Product Royalties. Licensee will purchase all re-sellable Licensed
Products from SLC, or SLC’s authorized affiliate. Licensee shall pay for all
such Licensed Products on a cost plus twenty-five percent (25%) markup basis,
unless otherwise agreed (the “Licensed Product Royalties”). For the avoidance of
doubt, this Agreement does not grant Licensee the right to produce, manufacture
or have manufactured Licensed Products for resale and any such production of
Licensed Products shall constitute an infringement of SLC’s and/or Owner’s
intellectual property rights.

 

(c)Royalty Reports. Licensee shall furnish SLC with written reports describing
in detail all Gross Revenues and Net Revenue, including all deductions taken
from the Gross Revenue, relative to the Business (the “Royalty Reports”). The
Royalty Reports shall be prepared and sent to SLC not later than ten (10) days
following the end of each calendar month. Royalty Reports may be adjusted on a
quarterly basis (if necessary, with SLC’s written approval), and shall be sent
not later than ten (10) business days after each calendar quarter period ending
in March, June, September and December of each year.

 

(d)Payment. Payment of Royalties due under this Section shall be made within ten
(10) business days after the end of each calendar month (or calendar quarter,
with SLC’s prior written approval) during the Term.

 

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3.OPERATIONS.

 

(a) Licensee, at its sole cost and expense, shall operate and maintain the
Business at the Location under the authority of this Agreement as prescribed
herein and as permitted by federal, state and local laws, rules, regulations or
orders.

 

(b) Licensee, at its sole cost and expense, shall provide any lighting, music,
music programming, sound equipment, or any other equipment and facilities
necessary for the proper operation of the Business at the Location.

 

(c) Licensee warrants that all food, beverages and merchandise shall be pure and
of good quality. Licensee shall maintain adequate inventory control to ensure a
constant supply of food, beverages and merchandise. Licensee shall operate any
restaurant, bar or the facility that dispenses food or beverage in such manner
as to maintain the highest health inspection rating.

 

(d) Licensee shall personally conduct operations under this Agreement and
utilize an employee operations manager satisfactory to SLC. The designated
manager must be available by telephone during all hours of operation. Licensee
shall notify SLC in writing of the name(s) of the designated manager(s) as soon
as such person(s) begin their employment with Licensee. Licensee shall promptly
notify SLC of any changes to who the designated managers are and any changes in
their contact phone numbers.

 

(e) Licensee shall at its sole cost and expense, provide a twenty-four (24) hour
per day security system at the Location.

 

(f) Licensee shall prepare and provide to SLC, reports of major accidents or
incidents involving law enforcement authorities occurring at the Location.
Licensee shall promptly notify SLC, in writing, of any claim for injury, death,
property damage or theft which shall be asserted against Licensee with respect
to the Location. Licensee shall also designate a person to handle all such
claims, including all insured claims for loss or damage pertaining to the
operations of the Location and Licensee shall notify SLC in writing, as to said
person’s name, address, phone number and e-mail address.

 

(g) Licensee shall promptly notify SLC of any unusual conditions that may
develop in the course of the operation of this License Agreement such as, but
not limited to, fire, flood, vandalism, casualty or substantial damage of any
character.

 

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4.APPROVALS.

 

In order to preserve the value, goodwill and reputation of the SCORES
Trademarks, Licensee and SLC shall consult with each other during the Term
hereof with regard to any marketing, advertising or promotional activities
pursuant to the Business and SLC will have the right to pre-approve in writing,
(in its sole discretion), all advertisements, promotional, marketing and other
similar materials, including but not limited to, the images and format of the
Diamond DollarsTM and the images of the SCORES Trademarks for the Business
(collectively, the “Promotional Materials”) in order to ensure consistent
quality of same and adherence to any brand or marketing guidelines provided by
SLC. Prior to using any Promotional Materials, Licensee shall send copies of all
proposed Promotional Materials to SLC for SLC and/or Owner’s review. SLC agrees
to use commercially reasonable efforts to inform the Licensee of the decision
regarding any approvals within ten (10) days of receiving Promotional Materials
for approval, provided, however, that SLC’s failure to provide such approvals
during such 10-day period shall not be deemed to constitute approval. All
Promotional Materials shall be deemed “works made for hire,” pursuant to the
Copyright Act of 1976, as amended, and all rights in and to the copyrights to
such Promotional Materials shall be owned by Owner.

 

5.COMPLIANCE WITH APPLICABLE LAWS AND STANDARDS.

 

Licensee shall comply with all applicable laws, codes, regulations, orders and
safety standards regarding the operation of the Business and the use of the
SCORES Trademarks herein. SLC’s approval of Promotion Materials pursuant to
Section 4 above in no way affects, alters, diminishes or waives Licensee’s
obligations hereunder or Licensee’s obligations to indemnify SLC as set forth
below.

 

6.BOOKS AND RECORDS.

 

Licensee shall, for a minimum of three (3) years from their creation, keep full
and accurate books of account, records, data and memoranda with respect to the
Business and the Licenses granted hereunder. Licensee grants SLC, Owner and/or
their duly authorized representatives the right during the Term of this
Agreement and for a period of three (3) years past the expiration or termination
of this Agreement, at their 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. Examinations
shall not be conducted more than once in every three (3) month period. Licensee
shall reasonably cooperate with SLC and/or Owner in the event SLC and/or Owner
requests an audit hereunder. SLC, Owner and their 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 SLC, Owner and/or their duly authorized
representatives from using or disclosing said information in any court,
arbitration, or other action instituted to enforce the rights of SLC and Owner
hereunder, or in order to comply with applicable rules, regulations or court
orders or to SLC and Owner’s shareholders, directors, officers, affiliates,
employees, consultants and advisors on a need to know basis. In the event that
an audit conducted pursuant to this Section 6 reveals an underpayment of monies
due SLC or its affiliates of more than five percent (5%) for the audited period,
such underpayment shall be paid by Licensee to SLC within five (5) business days
of notice of the underpayment to Licensee, and Licensee shall be solely
responsible to pay and/or reimburse SLC for the cost of such audit.

 

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7.INTELLECTUAL PROPERTY RIGHTS.

 

(a)Ownership Rights. All right, title and interest in and to the SCORES
Trademarks and related intellectual property are owned exclusively by the Owner.
All uses by Licensee of the SCORES Trademarks under the License shall inure to
the benefit of the Owner. In no event shall the granting of the Licenses set
forth herein be deemed to convey or transfer to Licensee any ownership rights in
or to any of the SCORES Trademarks. Licensee acknowledges that the SCORES
Trademarks have acquired secondary meaning.

 

(b)Notices. Licensee shall include all appropriate legal notices as required by
SLC with respect to all promotional, packaging and advertising material.

 

(c)No Challenge. Licensee acknowledges the exclusive ownership of all
intellectual property rights in and to the SCORES Trademarks by Owner 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, or commencing or participating in any
cancellation or opposition proceedings or other litigations.

 

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(d)Protection. Licensee shall execute all documents and take all reasonable
actions as SLC shall reasonably request to procure, preserve, confirm, evidence,
establish, register, enforce and protect the rights of Owner in the SCORES
Trademarks. Owner has the right, but not the obligation, to obtain at its own
cost, appropriate statutory protection for the SCORES Trademarks, for any
related intellectual property and/or for any advertising, promotional or
packaging materials for the Licensed Products.

 

(e)Infringements. Licensee agrees to give SLC prompt notification of any
third-party actions that would constitute an infringement of the rights granted
to it by this Agreement. SLC or the Owner of the SCORES Trademarks shall have
the exclusive right to prosecute, at their own discretion, infringement actions
against any third-party infringers, and any recoveries obtained therein shall
belong exclusively to SLC or the Owner of the SCORES Trademarks. Licensee shall,
at SLC’s expense, cooperate in all respects with the prosecution of said suits,
including but not limited to being named as a party in any such suit, producing
documents, appearing as witnesses, etc.

 

(f)Unauthorized Use of SCORES Trademarks. SLC and/or Owner shall have the right
to bring any action or proceeding deemed necessary by SLC and/or Owner against
Licensee for Licensee’s unauthorized use of the SCORES Trademarks or for any
breach by Licensee of any of the provisions in this Agreement regarding
Licensee’s use of the SCORES Trademarks. SLC and/or Owner shall have the right
to obtain immediate injunctive relief against Licensee in addition to any other
remedies available to SLC and/or Owner.

 

(g)Branding Guidelines. Licensee shall comply with all brand and/or marketing
guidelines that SLC may provide to Licensee regarding use of the SCORES
Trademarks. SLC shall have the right to terminate this Agreement for Licensee’s
failure to cure any misuse of the SCORES Trademarks or other noncompliance of
the brand and/or marketing guidelines.

 

(h)Reversion of Rights. Upon termination or expiration of this Agreement all
rights granted to Licensee under the Licenses and with respect to the SCORES
Trademarks shall immediately revert to SLC and/or Owner, and Licensee agrees to
immediately return to SLC all original artwork, models, samples, prototypes,
renderings and drawings incorporating the SCORES Trademarks and to cease all
uses of the SCORES Trademarks. All use by Licensee of the intellectual property
rights of the SCORES Trademarks shall inure to the sole benefit of Owner.
Licensee shall execute any and all documents necessary to confirm said
reversions of rights and hereby appoints SLC as its attorney-in-fact for the
sole and limited purpose of executing any such documents in the event Licensee
is unwilling or unable to do so unless Licensee is relying upon the specific
warranties set forth below.

 

(i)Owner is a third-party beneficiary of the provisions in this Section 7 and
can enforce them.

 

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8.REPRESENTATIONS AND WARRANTIES OF LICENSEE.

 

(a) Licensee represents and warrants that Licensee:

 

(i) shall commence operation of the Business at the Location within 90 days of
the execution of this Agreement and within that time obtain all permits,
approvals, and consents, including, but not limited to liquor license and zoning
and use permits in order that the Licensee may lawfully operate the Business at
the Location as an adult entertainment night club in the manner contemplated
herein;

 

(ii) shall render all services of a quality equal to the quality of other
Licensees of the SCORES Trademarks;

 

(iii) shall maintain facilities and trained personnel sufficient to perform its
obligations under this Agreement;

 

(iv) shall maintain a commercially reasonable inventory of merchandise bearing
the SCORES Trademarks;

 

(v) shall not promote or advertise during the Term of this Agreement, any
services or items that are comparable and competitive with SLC and which bear
the name or are associated with the name, of businesses that SLC deems to be
directly competitive with SLC without SLC’s prior written consent or any other
business which renders adult entertainment services, including but not limited
to gentlemen’s clubs, whether live or online;

 

(vi) shall not produce, distribute or sell any other products which are
substantially similar in design to the Merchandise, and shall not “knock off”
the Merchandise (which shall be determined by using a standard that is broader
than that for determining whether a copyright has been infringed); and

 

(vii) shall not take any action which creates any lien upon, mortgage or
otherwise encumber the Licensee’s interest in this Agreement without the express
prior written consent of SLC, which consent may be withheld in SLC’s sole and
absolute discretion.

 

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(b) Licensee hereby represents and warrants that Licensee has the right, power
and authority to enter into this Agreement and receive the rights and license
granted hereby and that all Promotional Materials used by Licensee in connection
with this Agreement will not infringe any copyright, trademark, trade dress or
other intellectual property right of any third party.

 

9.COOPERATION AND LICENSING MEETINGS.

 

(a) Cooperation. Licensee agrees to fully cooperate with and provide SLC with
advice and/or suggestions with respect to the rendering of services or sale of
merchandise.

 

(b) Licensing Meetings. Licensee agrees to attend or cause its representative to
attend, at Licensee's expense, Licensee meetings held by SLC at such locations
as SLC may designate within the Territory or at SLC’s offices to organize and
coordinate service, marketing and advertising strategies designed to promote the
success of the SCORES Trademarks.

 

(c) Right to Inspect Location. SLC and/or its authorized representatives shall
have the right at reasonable times without notice to inspect the Location and
require that any violations of this Agreement be immediately cured.

 

10.WARRANTIES/DISCLAIMERS OF SLC.

 

(a)SLC represents and warrants to Licensee that:

 

(i)Subject to any pre-existing licenses granted by the Owner of the SCORES
Trademarks, SLC is the exclusive Licensee of the SCORES Trademarks and has the
sole and exclusive rights to sublicense the same on the terms set forth herein;

 

(ii)SLC has full power and authority to enter into this Agreement;

 

(iii)To the best of SLC’s actual knowledge as of the Effective Date, the
granting of the Licenses hereunder or the subsequent commercial exploitation of
the Licenses during the Term does not violate the registered U.S. trademark
rights of any third party; and

 

(iv)To the best of SLC’s actual knowledge as of the Effective Date, there are no
liens, encumbrances, security interests, claims, actions, proceedings, or
judgments regarding the SCORES Trademarks which would in any way impede, hinder,
impair or interfere with the Licensee’s rights hereunder.

 

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(b)EXCEPT FOR THE EXPRESS WARRANTIES OF SLC IN THIS SECTION 10, SLC AND ITS
PARENT, AFFILIATES AND SUBSIDIARIES HEREBY DISCLAIM ALL WARRANTIES, EXPRESS OR
IMPLIED, WITH RESPECT TO THE SCORES TRADEMARKS AND OTHERWISE, INCLUDING WITHOUT
LIMITATION THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, AND NON-INFRINGEMENT.

 

11.INDEMNIFICATION.

 

(a) Indemnification of Licensee. SLC agrees to indemnify and hold harmless
Licensee from and against any and all third-party claims arising from the breach
by SLC, as determined by a final, non-appealable court order or judgment, of any
of SLC’s express warranties, set forth in Section 10, provided that Licensee
provides SLC with prompt written notice of such claim, and such indemnification
shall constitute Licensee’s sole and exclusive remedy with respect to any such
alleged breach of warranty. Any claims made against Licensee which would result
in SLC becoming obligated to indemnify Licensee hereunder shall not permit
Licensee to withhold any amount due SLC hereunder. Licensee shall not settle or
comprise any such indemnified claim without the prior written consent of SLC.

 

(b) Indemnification of SLC. Licensee agrees to indemnify, defend, and hold
harmless SLC and Owner, and their subsidiaries, affiliates and licensor(s), and
their shareholders, officers, directors, agents and employees from and against
any and all claim, action, loss, expense, damages, or judgment arising out of or
related to any claims of personal injury, product liability, wrongful death,
negligence, strict liability or similar action, employee or contractor-related
claims or suits, entertainer-related claims or suits, supplier-related claims or
suits, and all claims or suits arising from the breach by Licensee of any of its
third-party contracts or obligations or warranties under this Agreement or the
violations of any applicable law or safety standard by or on behalf of Licensee
and/or its subsidiary, affiliated or controlled company (if any). Licensee shall
maintain, at its sole cost and expense, premises liability, liquor liability,
workman’s compensation (in the amount required by the State of New York or
applicable jurisdiction of the Territory), plate glass insurance (as per
Licensee’s lease), commercial liability coverage and other customary insurance.
The premises, commercial, and liquor insurance policies carried by Licensee must
provide AAA insurance coverage of at least $3,000,000 per occurrence, naming SLC
and Owner as additional insurers, and providing that such policy cannot be
cancelled without thirty (30) days prior written notice to SLC. SLC may, at
Licensee’s expense, retain counsel of its own choosing to defend said claims,
and Licensee shall pay all fees and expenses of such counsel. All insurance
shall be primary and not contributory. Licensee agrees to provide SLC with a
copy of the insurance declarations and/or certificates within twenty (20) days
following the Effective Date of this Agreement.

 

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12.TERMINATION.

 

(a) Termination For Default. In case either party fails to perform under or
commits or allows to be committed a material breach of any of the terms and
conditions of this Agreement, the other party may send written notice to the
defaulting party, and such defaulting party shall then 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 or is
incapable of being cured, then the aggrieved party may terminate this Agreement
immediately by a further notice in writing effective upon mailing. If SLC 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 such notice.

 

(b) Ongoing Covenants. Any termination under this Section 12 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) Insolvency; Bankruptcy. If a petition in bankruptcy is filed by or against
Licensee, or Licensee becomes insolvent, or makes an assignment for the benefit
of creditors, or any other arrangement pursuant to any bankruptcy law, or if
Licensee 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 Licenses granted herein shall automatically terminate without any notice
whatsoever being necessary. In the event this Agreement 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 under the special consent and instructions of SLC in writing, in SLC’s
sole discretion, which they shall be obliged to follow.

 

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(d) Cessation of Business. Upon cessation of the Business by the Licensee for a
period of greater than thirty (30) days for any reason other than Force Majeure,
this Agreement and the Licenses granted herein shall terminate automatically.

 

(e) Sale or Transfer of Business. If Licensee seeks to sell its Business or the
assets of stock of the Business or otherwise transfer control of the Business,
Licensee shall give SLC at least sixty (60) days advance written notice. Upon
such sale or transfer, all rights and obligations of the Parties relative to
this Agreement shall cease and be of no further force or effect, and this
Agreement and the Licenses granted herein shall be deemed terminated.

 

(f) Termination for Convenience. SLC may terminate this Agreement upon thirty
(30) days written notice to Licensee for any reason or no reason without further
obligation, provided, however, that upon such termination, Licensee shall pay to
SLC all of its accrued Business Royalties and provide SLC with final Royalty
Reports.

 

(g) Cessation of Use. Upon termination or expiration of this Agreement for any
reason, the Licenses granted herein shall automatically terminate and Licensee
shall immediately cease and desist all uses of the SCORES Trademarks, and all
rights under the Licenses shall automatically revert to SLC or Owner, as
determined by SLC. In no event shall Licensee make any uses of the SCORES
Trademarks beyond the Term of this Agreement.

 

(h) Final Royalty Report. Within thirty (30) days after the expiration or
termination of this Agreement, Licensee shall deliver to SLC any remaining
Business Royalties due and owing and a final Royalty Report.

 

13.REMEDIES.

 

(a) Relief In Equity Against Certain Defaults. In the event of a breach by
Licensee of any of its obligations under this Agreement, Licensee acknowledges
and agrees that, SLC will have no adequate remedies at law and that it will be
irreparably damaged in the event that the provisions of this Agreement are not
specifically enforced. Accordingly, Licensee agrees that (a) an action for
specific performance of the obligations created by this Agreement shall be a
proper remedy for such breach, or threatened breach, and (b) Licensee shall not
assert as a defense or otherwise in such action an allegation or claim that
would contravene the agreement set forth in this Section. Such equitable remedy
shall, however, be cumulative not exhaustive and shall be in addition to any
other remedies available to SLC for a breach or threatened breach of this
Agreement, including the recovery of damages and legal fees.

 

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(b) Other Rights. In addition to the right to termination pursuant to Section
12, SLC may take, upon any default by Licensee, whatever action it deems
reasonably necessary to protect its rights and interests under this Agreement.
The termination of this Agreement by SLC shall not be deemed an election of
remedies by SLC any such termination shall be without prejudice to the rights or
remedies which SLC might otherwise have against Licensee under law, in contract
or in equity for breach of this Agreement.

 

(c) Equitable Relief. Licensee acknowledges that its failure to cease use of the
SCORES Trademarks at the termination or expiration of this Agreement, except as
expressly provided herein, will result in immediate and irreparable damage to
SLC and to the rights of any subsequent licensee. Licensee acknowledges and
admits that there may be no adequate remedy at law for such failure and Licensee
agrees that in the event of such failure SLC shall be entitled to seek equitable
relief and any other and further relief as any court with jurisdiction may deem
just and proper. In the event of equitable relief in favor of SLC pursuant to
the terms of this Section, it is the intent of the Parties that no undertaking
(whether in the form of cash or surety bond) shall be required of SLC except to
the extent of a nominal amount, if any, is otherwise expressly required by
statute.

 

(d) Attorneys’ Fees. In the event that either party to this Agreement shall
commence or otherwise be made a party to any suit, action, arbitration or other
proceeding to interpret this Agreement, or to determine or enforce any right or
obligation created hereby, if SLC is the prevailing party, SLC shall recover its
costs and expenses incurred in connection therewith, including reasonable
attorneys’ fees and costs of appeal, if any.

 

(e) Liquidated Damages. Any termination of this Agreement resulting from a
breach or default by Licensee shall not relieve Licensee for many obligations
which it had prior to the date of termination or from the continuing obligation
to pay any Royalties for the balance of the Term. Notwithstanding the foregoing,
the Parties acknowledge that the breach by Licensee of this Agreement would
cause substantial damages to SLC, including, but not limited to, loss of
"presence" in the marketplace while a successor or replacement Licensee is
located, and that the extent of such damages would be difficult and impractical
to ascertain. Accordingly, and without prejudice to SLC’s rights and remedies or
Licensee's indemnification obligations, it is agreed that if SLC terminates this
Agreement as a result of Licensee's breach or default, then SLC shall be
entitled to recover from Licensee, as liquidated damages (in lieu of any
recovery for Business Royalties, but not in limitation of any other remedies
which SLC may have as a result of such breach or default such as the right to
injunctive relief, the right to recover past due Business Royalties up to the
date of termination, and reasonable attorneys’ fees and costs of collection
incurred by SLC and due as of the date of termination), a sum equal to six (6)
times the monthly pro rata amount of such Business Royalties due on the date of
termination, provided, however, that if there are fewer than six (6) months
remaining on the Term, then the foregoing amount shall be computed based upon
the number of months remaining.

 

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14.CONDITIONS; CONFIDENTIALITY.

 

This Agreement and Licensee’s rights hereunder are conditioned upon Licensee’s
compliance with the terms hereof, including, without limitation, the following:

 

(a)Permits and Consents. Licensee, at its own cost, obtaining all permits,
approvals and consents including, but not limited to, a liquor license and
zoning and use permits in order that the Licensee may lawfully operate the
Business in the Territory and at the Location as an adult entertainment night
club and bar in the manner contemplated herein.

 

(b)Operation of Business. SLC acknowledges that, with the exception of the
SCORES Trademarks, the Business is owned solely by Licensee and that, absent an
uncured default by Licensee, SLC will not interfere with the Business or the
operations thereof and that control of the Business remains solely with
Licensee, subject to Licensee’s compliance with all the terms and conditions of
this Agreement.

 

(c)Confidentiality. Licensee shall maintain in strictest confidence all of the
terms and conditions of this Agreement, as well as, any other information or
materials of SLC which are of a confidential and/or proprietary nature (the
“Confidential Information”). Licensee shall use the Confidential Information
received from SLC solely to fulfill Licensee’s obligations under this Agreement.

 

15.TERM.

 

Unless earlier terminated in accordance with Section 12 by either party, the
term of this Agreement shall commence on the Effective Date and continue for an
initial term of five (5) years, with five (5) successive five (5)-year renewals,
which renewals will occur automatically (collectively, the “Term”).

 

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16.LIMITATION OF LIABILITY.

 

EXCEPT WITH RESPECT TO LICENSEE’S INDEMNIFICATION OBLIGATIONS HEREUNDER AND/ OR
CLAIMS ARISING OUT OF LICENSEE’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OR
LICENSEE’S VIOLATION OF THE INTELLECTUAL PROPERTY, LICENSE OR CONFIDENTIALITY
RESTRICTIONS CONTAINED HEREIN, IN NO EVENT SHALL EITHER PARTY OR THEIR PARENTS
(INCLUDING OWNER), AFFILIATES OR SUBSIDIARIES BE LIABLE FOR INDIRECT,
INCIDENTAL, CONSEQUENTIAL, SPECIAL, EXEMPLARY OR PUNITIVE DAMAGES, REGARDLESS OF
THE FORM OF ACTION, WHETHER IN CONTRACT, TORT OR OTHERWISE, EVEN IF SUCH PARTY
HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. IN NO EVENT SHALL SLC’S OR
OWNER’S LIABILITY TO LICENSEE ARISING OUT OF THIS AGREEMENT EXCEED, IN THE
AGGREGATE, THE AMOUNTS PAID BY LICENSEE TO SLC UNDER THIS AGREEMENT DURING THE
NINETY (90) DAY PERIOD IMMEDIATELY PRECEEDING THE ACCRUAL OF THE ALLEGED CAUSE
OF ACTION. IN NO EVENT MAY ANY ACTION BY LICENSEE AGAINST SLC OR OWNER HEREUNDER
BE ASSERTED MORE THAN ONE (1) CALENDAR YEAR AFTER THE CLAIM IN QUESTION HAS
ACCRUED.

 

17.REPRESENTATION.

 

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 Parties.

 

18.FORCE MAJEURE.

 

It is understood and agreed that in the event of an act of the government, war,
terrorism, fire, flood or other natural disaster, or labor or manufacturing
strikes which prevent the performance of this Agreement, such nonperformance
will not be considered a breach of this Agreement, and such nonperformance shall
be excused while, but not longer than, the conditions described herein prevail.
The period of Force Majeure shall not exceed twelve (12) months. Either party
may terminate this Agreement upon written notice to the other party if the Force
Majeure event lasts for twelve (12) months or longer.

 

19.NOTICES.

 

All notices, whenever required in this Agreement, will be in writing and sent by
certified mail, return receipt requested, or via standard overnight courier,
facsimile transmission or electronic mail, to the addresses designated by the
Parties for such purpose. Notices will be deemed to have been given two business
days following mailing, one business day after delivery to an overnight courier,
and upon electronic confirmation of a facsimile transmission.

 

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Notices To SLC:Scores Licensing Corp.

617 11th Avenue, New York, NY 10036

Fax: (212) 246-0856

Attn: Howard Rosenbluth

E-mail: howardr@pecnyc.com

 

With a copy to: Jeffrey Weingart, Esq., Meister Seelig & Fein LLP, 140 East 45th
Street, 19th Floor, New York, NY, 10017, Fax No. (212) 655-3535.

 

Notices to Licensee: [To Be Provided By Licensee]

 

20.CONTROLLING LAW; VENUE.

 

This Agreement shall be construed In accordance with the laws of the State of
New York, United Stated of America, and jurisdiction over the Parties and
subject matter of this Agreement with respect to any controversy arising
hereunder, in whole or in part, shall be exclusively in the federal or state
courts located in the State of New York, County of New York. The Parties hereby
irrevocably consent to the exclusive jurisdiction and venue of such courts.

 

21.ASSIGNMENT.

 

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

 

22.ENTIRE AGREEMENT.

 

This Agreement constitutes the entire agreement and understating between the
Parties hereto. 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 the
Parties.

 

23.MISCELLANEOUS.

 

(a) The section 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.

 

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(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 counterparts, all of which
shall be deemed to be originals. Signatures delivered by electronic means shall
be accepted and treated as original signatures.

 

(d) The following Sections of this Agreement shall survive the termination or
expiration of this Agreement: 2, 6, 7, 11, 12, 13, 14 (c), 16, 19, 20, 21, 24
and 25.

 

24.SECURITY INTEREST.

 

(a) In order to induce SLC to enter into this Agreement and to secure the
complete and timely performance of Licensee’s obligations hereunder, Licensee
hereby grants to SLC a security interest in Licensee’s receipts and receivables
from the Business as collateral. In the event Licensee defaults under this
Agreement, SLC may enforce against Licensee all the rights and remedies of a
secured creditor with respect to Licensee’s receipts and receivables from the
Business upon default under all applicable laws. In the event Licensee files for
bankruptcy under the U.S. Bankruptcy Laws, SLC may enforce all rights and
remedies of a secured creditor under the U.S. Bankruptcy Code.

 

(b) Licensee agrees to execute any and all documents necessary to perfect SLC’s
security interest hereunder including, but not limited to, Financing Statement
Form UCC-1 and any other security agreements and financing statements evidencing
said security interest in such form as may be recorded and perfected according
to applicable laws.

 

25.SECURITY DEPOSIT.

 

A two month Security deposit shall be held by Licensor without liability for
interest and as security for the performance by Licensee of Licensor’s covenants
and obligations under this agreement, it being expressly understood that the
Security Deposit shall not be considered an advance payment of royalties or
other obligation but a measure of Licensor’s damages in case of default by
Licensee. Unless otherwise provided by mandatory non-waive able law or
regulation, Licensor may commingle the Security Deposit with Licensor’s other
funds. Licensor may, from time to time, without prejudice to any other remedy,
use the Security Deposit to the extent necessary to make good any arrearages of
royalties or to satisfy any other covenant or obligation of Licensor hereunder.
Following any such application of the Security Deposit, Licensee shall pay to
Licensor on demand the amount so applied in order to restore the Security
Deposit to its original amount. If Licensee is not in default at the termination
of this agreement the balance of the Security Deposit remaining after any such
application shall be returned by Licensor to Licensee. If Licensor transfers its
interest in the premises during the term of this agreement, Licensor may assign
the Security Deposit to the transferred and thereafter shall have no further
liability for the return of such Security Deposit.

 

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THIS AGREEMENT AND THE LICENSE GRANT CONTAINED HEREIN SHALL NOT BE CONSIDERED
VALID UNTIL EXECUTED BY AN EXECUTIVE OFFICER OF SCORES LICENSING CORP.

 

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement by their
respective duly authorized representatives as of the date first written above.

 

SCORES LICENSING CORP.

 

By: /s/ Howard Rosenbluth By: /s/ Anthony Quaranta     Print Name: Howard
Rosenbluth Print Name: Anthony Quaranta     Title: CFO Title: Owner     Date:
5/12/14 Date: 5/2/14

 

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SCHEDULE A

 

1.SCORES Trademarks:

 

 [logo.jpg] ® trademark, U.S. Registration No. 1,830,135

 

International Classes: 6, 41, 42

 

[image_003.gif]  ® trademark, U.S. Registration No. 1,855,829

 

 

International Classes: 25, 41, 42

 

 

 

THE REAL MEN OF SCORESTM trademark, U.S. Serial No. 85/905,856

 

International Classes: 41, 43

 

 

 

SCORES COLLECTIONTM trademark, U.S. Serial No. 85/965,064

 

International Class: 35

 

 

 

DIAMOND DOLLARSTM

 

 

 

2.Licensed Products:

 

Apparel, underwear, jewelry, novelties and other items, in each case subject to
the prior written approval and consent of SLC.

 

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