-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WH0I9dBI2ugefZd27mVGWtnR29Vd7KXW4vCy7LeHL/p6ry2sQBJKsmH2i7HJACm3 jTZDNsJrQ994eY8HrjE/Aw== 0000893220-99-001202.txt : 19991026 0000893220-99-001202.hdr.sgml : 19991026 ACCESSION NUMBER: 0000893220-99-001202 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 8 CONFORMED PERIOD OF REPORT: 19991014 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19991025 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GARY PLAYER DIRECT INC CENTRAL INDEX KEY: 0000798740 STANDARD INDUSTRIAL CLASSIFICATION: WATCHES, CLOCKS, CLOCKWORK OPERATED DEVICES/PARTS [3873] IRS NUMBER: 930943925 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 033-07811-NY FILM NUMBER: 99733330 BUSINESS ADDRESS: STREET 1: 2811 AIRPARK DRIVE CITY: SANTA MARIA STATE: CA ZIP: 93455 BUSINESS PHONE: 8053461600 MAIL ADDRESS: STREET 1: 8250 S AKRON ST SUITE 203 STREET 2: SUITE 500 CITY: ENGLEWOOD STATE: CO ZIP: 80112 FORMER COMPANY: FORMER CONFORMED NAME: GRAFIX CORP DATE OF NAME CHANGE: 19980818 FORMER COMPANY: FORMER CONFORMED NAME: GRAFIX TIME CORPORATION DATE OF NAME CHANGE: 19950130 8-K 1 FORM 8-K CURRENT REPORT - GARY PLAYER DIRECT, INC. 1 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): October 14, 1999 GARY PLAYER DIRECT, INC. (Exact Name of Small Business Issuer as Specified in Its Charter) Delaware 033-07811NY 91-1999113 - -------------------------------- ----------- ------------------ State or Other Jurisdiction Commission IRS Employer of Incorporation or Organization File Number Identification No. 710 Aerovista, Suite B, San Luis Obispo, CA 93401 - ------------------------------------------- -------- Address of Principal Executive Offices Zip Code Registrant's telephone number, including area code: (805)783-1011 -------------- 2811 AIRPARK DRIVE, SANTA MARIA, CALIFORNIA 93455 ----------------------------------------------------------- Former name or former address, if changed since last report 2 Item 5. Other Events. Gary Player Direct, Inc. (the "Company") entered into a Succession Plan and Agreement (the "Succession Plan") effective on October 14, 1999 pursuant to which Mr. A.J. Cervantes resigned from his positions as the Company's Chairman, President and Chief Executive Officer. Mr. Robert J. Friedland also resigned from his membership on the Board of Directors. A copy of each of the Succession Plan and the Press Release announcing such Succession Plan is attached to this Current Report on Form 8-K as an exhibit and is hereby incorporated by reference. In connection with the resignation of Mr. Cervantes, Marc B. Player and Pamela J. Campbell, both affiliated with The Gary Player Group of Palm Beach Gardens, Florida, were appointed to the Company's Board of Directors as well as Thomas P. Gallagher, of Princeton, New Jersey, who was named Chairman of the Board. The Company also appointed Carl L. Casareto to the positions of Executive Vice President and Treasurer, and pursuant to such appointment, Mr. Casareto has assumed day-to-day managerial responsibilities for the Company. The Company additionally appointed Ms. Barbara Nunez to the positions of Controller and Secretary of the Company. The Company is currently searching for a permanent Chief Executive Officer and believes that it will name one within the next sixty to ninety days. Mr. Gallagher has been appointed interim Chief Executive Officer. The Company has executed indemnification agreements with each of the above-named directors and officers, which indemnification agreements have been authorized and approved by the Company's Board of Directors and are attached to this Current Report on Form 8-K as exhibits and are hereby incorporated by reference. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. (c) Exhibits. 10.1 Succession Plan and Agreement dated October 12, 1999 by and among Alfonso J. Cervantes, Jr. as well as any corporation, partnership, limited liability company or any other entity controlled by Cervantes or his Spouse including Trilogy Capital Group, Inc., Judith Cervantes, Robert J. Friedland, Gary Player Direct, Inc., its subsidiaries Rhino Marketing, Inc., G.P. Direct, Inc., Digital-Golf.Com, Inc. and Gran Prix Marketing, Inc., Thomas P. Gallagher, Gallagher, Briody & Butler, William S. Schuler, Ritch Gaiti, Jeffrey Leach and Roy Tashi as principal of Lava Investments Limited, Gary Player Golf Equipment and The Gary Player Group, Gary D. Kucher, J. 2 3 Paul Bagley, and Stone Pine Venture Lending, Llc and its affiliated companies. 10.2 Indemnification Agreement by and between Gary Player Direct, Inc. and Thomas P. Gallagher dated October 14, 1999. 10.3 Indemnification Agreement by and between Gary Player Direct, Inc. and Marc B. Player dated October 14, 1999. 10.4 Indemnification Agreement by and between Gary Player Direct, Inc. and Pamela Campbell dated October 14, 1999. 10.5 Indemnification Agreement by and between Gary Player Direct, Inc. and Carl L. Casareto dated October 14, 1999. 10.6 Indemnification Agreement by and between Gary Player Direct, Inc. and Barbara Nunez dated October 14, 1999. 99.1 Press Release dated October 19, 1999. 3 4 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. GARY PLAYER DIRECT, INC. By: /s/ Carl Casareto ------------------------------------------- Carl Casareto, Executive Vice President and Treasurer (Principal Executive Officer) Date: October 25, 1999 4 EX-10.1 2 SUCCESSION PLAN AND AGREEMENT 1 Exhibit 10.1 SUCCESSION PLAN AND AGREEMENT THIS SUCCESSION PLAN AND AGREEMENT ("Agreement") is entered into and effective as of the 12th day of October, 1999, by and among ALFONSO J. CERVANTES, JR. as well as any corporation, partnership, limited liability company or any other entity controlled by Cervantes or his Spouse including Trilogy Capital Group, Inc. ("Cervantes"), JUDITH CERVANTES ("Spouse"), ROBERT J. FRIEDLAND ("Friedland"), GARY PLAYER DIRECT, INC. ("GPD"), its subsidiaries RHINO MARKETING, INC., G.P. DIRECT, INC., DIGITAL-GOLF.COM, INC. AND GRAN PRIX MARKETING, INC. (collectively, the "Subsidiaries"), THOMAS P. GALLAGHER, GALLAGHER, BRIODY & BUTLER, WILLIAM S. SCHULER, RITCH GAITI, JEFFREY LEACH and ROY TASHI as principal of LAVA INVESTMENTS LIMITED (the "Shareholder Group" inclusive of Gallagher, Briody & Butler notwithstanding the fact that they are not shareholders), GARY PLAYER GOLF EQUIPMENT and THE GARY PLAYER GROUP, (collectively, Gary Player Golf Equipment Company and The Gary Player Group shall be referred to as "Player"), GARY D. KUCHER ("Kucher"), J. PAUL BAGLEY ("Bagley"), and STONE PINE VENTURE LENDING, LLC and its affiliated companies ("Stone Pine"). RECITALS A. Cervantes has been employed as an officer of GPD pursuant to a written employment agreement between Cervantes and Golf One Industries, Inc. dated May 31, 1998 as amended (the "Employment Agreement"), and served on its Board of Directors. B. On or about May 22, 1998, Golf One Industries, Inc. and Cervantes entered into an Indemnification Agreement (the "Indemnification Agreement") which Indemnification Agreement shall survive the execution and delivery of this Agreement. On or about May 22, 1998, Golf One Industries, Inc. and Friedland entered into an Indemnification Agreement (the "Friedland Indemnification Agreement) which Friedland Indemnification Agreement shall survive the execution and delivery of this Agreement except as provided herein. C. On or about March 26,1999, Golf One Industries, Inc. merged with and into Grafix Corporation and in connection therewith, Grafix Corporation changed its name to Gary Player Direct, Inc. and the Employment Agreement was assumed by Gary Player Direct, Inc. D. As of the effectiveness of this Agreement, GPD has terminated Cervantes' employment without cause. E. A Special Meeting of the Board of Directors of GPD was held on October 12, 1999 (the "Board Meeting") appointing Thomas P. Gallagher, Marc B. Player and Pam Campbell to GPD's and the Subsidiaries Boards of Directors. This Agreement was approved at the Board Meeting. 2 F. Cervantes has served as a Director of Golf One Industries and GPD since 1995 and in connection with the execution of this Agreement has agreed to resign from the Boards of Directors of GPD and the Subsidiaries on the effectiveness of this Agreement. G. Robert J. Friedland has served as a Director of Golf One Industries and GPD since July of 1996 and in connection with the execution of this Agreement has agreed to resign from all of his offices (if any) and director positions with GPD and the Subsidiaries on the effectiveness of this Agreement. H. In order to effect a smooth transition for the sake of GPD, the parties desire to enter into an amicable resolution relating to the end of the employment relationship between GPD and Cervantes. NOW, THEREFORE, in consideration of the mutual covenants and conditions set forth below, and intending to be legally bound thereby, the parties agree as follows: 1. Cervantes and Friedland confirm that they have conducted a Special Meeting of the Board of Directors of GPD (the "Board Meeting") on October 12, 1999 with the minutes of said Board meeting attached as Exhibit 3.0 appointing the new directors of GPD and the Subsidiaries, which Cervantes and Friedland attended as their last acts as a member of GPD's and the Subsidiaries' Boards of Directors, which actions shall be effective as of the effectiveness of this Agreement. At the Board Meeting (i) Thomas Gallagher, Marc B. Player and Pam Campbell were appointed to fill vacancies on the Board; (ii) the Board of Directors appointed Gallagher as Interim Chairman of the Board; (iii) the Board of Directors approved this Agreement, with Cervantes and Friedland abstaining; and (iv) the Board of Directors approved the indemnification agreements for the appointed directors and officers of GPD and the Subsidiaries. 2. Cervantes hereby resigns as a Director of GPD and the Subsidiaries and tenders his resignations from any committees to which he was appointed as of the effectiveness of this Agreement. This Agreement shall be deemed effective as of the termination of the Board of Directors Meeting referenced in Section 1.0 above. 3. Friedland hereby resigns as a Director of GPD and the Subsidiaries and tenders his resignations from any committees to which he was appointed as of the effectiveness of this Agreement. 4. GPD represents and warrants that there is a director and officer insurance policy in full force and effect (with all premiums paid) as of the effective date of this Agreement with Genesis Insurance Company with a coverage limit of $1,000,000 and a deductible limit of $50,000 non-SEC related and $100,000 security related. 5. GPD hereby terminates Cervantes' employment without cause as of the effectiveness of this Agreement. 2 3 6. GPD and Cervantes mutually agree that the Indemnification Agreement shall remain in full force and effect. In addition, Cervantes represents and warrants that he, his Spouse and any other entity controlled by them beneficially own, as defined in Section 13(d) of the Securities Exchange Act of 1934, such shares of common stock of the Company as set forth in Exhibit 6.0. Exhibit 6.0 also describes the consideration paid for each of the shares set forth on Exhibit 6.0. Cervantes and GPD agree that the Indemnification Agreement shall not cover any claims made under this Agreement. GPD shall engage counsel,as soon as possible following the execution of the Agreement, and upon payment of the legal fees to issue a legal opinion to the effect that upon issuance of the 90,000 shares set forth in Exhibit 6.0 to Cervantes (the "Post-Agreement Shares"), such shares will be validly issued, fully paid and non-assessable shares of GPD. The issuance of the Post-Agreement Shares shall be conditioned upon the receipt of the legal opinion referenced above. GPD will promptly provide to such counsel such officer certificates as is typically required by counsel in connection with rendering such an opinion, including a certified copy of the Board resolution (if any) authorizing the issuance of such shares for prior services rendered by Cervantes as a director. Exhibit 6.1 contains a listing of threatened or pending litigation and is inserted for informational purposes only. 7. Cervantes acknowledges that he has been paid all salary due and accrued through September 30, 1999. The balance of unpaid salary through the effective date of this Agreement shall be paid out of the first equity financing received by GPD, but in no event no later than November 30, 1999. 8. Messrs. Gallagher, Marc B. Player, Pam Campbell and Carl L.Casareto and GPD shall enter into Indemnification Agreements for the benefit of Messrs. Gallagher, Player and Casareto and Ms. Campbell for serving in their roles as directors and/or officers of GPD. 9. Except as provided below, Cervantes hereby delivers any property of GPD, including but not limited to any cell phones, pagers or corporate credit cards of GPD, in his possession. Cervantes hereby agrees to be taken off any and all corporate accounts as an authorized agent or signatory and shall execute such documents necessary to effectuate such release. Cervantes agrees that attorneys' fees incurred by him in connection with the negotiation of this Agreement are his sole responsibility. GPD will forward to Cervantes all of his personal effects. Cervantes acknowledges that all files relating to the business of GPD or about golf equipment production or internet marketing are the files of GPD and that he has no right to any such files or the copies thereof. Upon the effectiveness of this Agreement, Cervantes recognizes, agrees and acknowledges that he has no further authority whatsoever to sign any contracts, agreements, documents, checks, purchase orders or make any representations whatsoever that he has authority to bind in any manner whatsoever GPD or the Subsidiaries to any contracts, agreements or commitments. Cervantes agrees to cooperate with GPD to the extent necessary in communicating the terms of this Succession Plan and Agreement with any banks, vendors, creditors or third parties. Cervantes, at his own cost and expense, may make copies of all business records that were either addressed to him or authored by him and shall be entitled to have access to and make copies of any other records of GPD and the Subsidiaries in connection with Cervantes' review of his expense reports and in defending any actions or claims against him including, without limitation, any claims by third party vendors or claims by any creditors with respect to obligations which Cervantes has guaranteed. In addition, 3 4 Cervantes agrees to cooperate in the defense of any pending litigation against GPD and/or the Subsidiaries with such compensation to be agreed by GPD and Cervantes in advance including payment of any out-of-pocket expenses including travel for attending any depositions or legal proceedings involving GPD and/or the Subsidiaries. GPD's counsel will represent Cervantes at any depositions that he is required to attend on behalf of GPD and/or the Subsidiaries or GPD will assume the cost of his attorney's fees if GPD's counsel cannot represent him. Cervantes shall be entitled to retain the personal home computer, personal fax machine, Palm Pilot computer and laptop computer by paying GPD $1,000 for this equipment with such payment to be made by the and offset against any unpaid expenses or salary due and owing to Cervantes under this Agreement. GPD acknowledges and agrees that Cervantes has previously received and may retain certain golf clubs manufactured by GPD and the Subsidiaries. 10. Cervantes and GPD agree that any expenses incurred by Cervantes and paid for by GPD or the Subsidiaries before the date of this Agreement (the "Pre-Agreement Expenses") that were not reasonably in furtherance of a valid corporate business purpose of GPD (taking into consideration Cervantes' Employment Agreement and the then existing policies of the Board of Directors of GPD or their Subsidiaries) will be a personal obligation of Cervantes and not an obligation of GPD or the Subsidiaries. GPD and the Subsidiaries acknowledge that GPD and the Subsidiaries cannot challenge the actual amount of a charge so long as it is reasonably in furtherance of a valid business purpose of GPD. GPD and the Subsidiaries shall have a period of ninety (90) days from and after the effective date of this Agreement to review any Pre-Agreement Expenses. In the event that GPD or the Subsidiaries do not challenge any Pre-Agreement Expenses within this ninety (90) day period, neither GPD nor the Subsidiaries shall institute any action to challenge such Pre-Agreement Expenses. In the event that GPD or the Subsidiaries challenge Pre-Agreement Expenses, GPD and the Subsidiaries shall notify Cervantes in writing and Cervantes shall have a period of seven (7) days following written notice of such challenge to correct, agree or reject any challenge in whole or in part. Once GPD and the Subsidiaries are in receipt of Mr. Cervantes' objection, they shall have seven (7) days to review the objection of Mr. Cervantes. In the event that Cervantes, GPD or the Subsidiaries cannot resolve the issue of the Pre-Agreement Expenses, the two parties shall each select an arbiter and the arbiters shall select a third arbiter with the decision of the arbiters being binding upon GPD, the Subsidiaries and Cervantes. In the event that the arbiters' decision is that Cervantes was not entitled to all or any part of Pre-Agreement Expenses and Cervantes is responsible to repay more than $2,500.00 to GPD or the Subsidiaries, Cervantes shall have the option to execute a promissory note agreeing to reimburse GPD or the Subsidiaries for the refundable Pre-Agreement Expenses with such note to bear interest at 7.5% per annum and be due and payable two (2) years from its issuance date and GPD and the Subsidiaries agree that they shall bring no action against Cervantes with respect to the Pre-Agreement Expenses unless there is a default under the note. GPD and the Subsidiaries agree that this is their sole remedy against Cervantes with respect to recovery of Pre-Agreement Expenses, and agree not to bring any action or claim against Cervantes except for breach of the note. With respect to those expenses that have been incurred but not yet paid as of the effective date of this Agreement (the "Post-Agreement Expenses"), GPD, the Subsidiaries as well as Cervantes agree that they shall be resolved by October 26, 1999 with a partial payment being made on the date hereof of $10,000. In the event that the Post-Agreement Expenses cannot be mutually resolved, the arbitration process outlined above will also be utilized with GPD and the Subsidiaries obligated to notify Cervantes by October 26, 1999 4 5 that they object in whole or in part to the Post-Agreement Expenses identifying those expenses to which it objects. Any expenses to which they do not object by 5:00 P.M. California time on October 26, 1999 shall be deemed accepted by GPD and shall be paid immediately. If Cervantes desires to make a claim for the expenses objected to by GPD, he shall notify GPD within seven (7) days of receipt of the objection notice, in which event GPD and Cervantes will attempt to reach a resolution of the issue. In the event that Cervantes, GPD or the Subsidiaries cannot resolve the issue of the Post-Agreement Expenses, the parties shall then utilize the arbitration procedure outlined above for the Pre-Agreement Expenses. In the event that the arbiters determine that Cervantes was entitled to all or any portion of the Post-Agreement Expenses, they shall be paid immediately. GPD shall pay Cervantes' hotel bill from the effectiveness of this Agreement until October 31, 1999. 11. Player hereby acknowledges that a certain License Agreement between Player and GPD whereby GPD was granted a 20-year exclusive right to use the name and likeness of Gary Player and ancillary marks in North America in connection with the manufacture, marketing, distribution and exploitation of golf clubs, accessories and apparel is in default as of the date hereof but shall be amended and will be in full force and effect within seven (7) business days of the effective date of this Agreement pursuant to such amendment, a copy of which amended License Agreement will be attached hereto as Exhibit 11.0 and currently is subject to certain claims of Player for unpaid royalties and license fees as described on Exhibit 11.1. In addition, Player agrees and acknowledges that the Asset Purchase Agreement entered into between GPD and Player is in default as of the date hereof but the provisions of such Asset Purchase Agreement shall be amended to provide, among other things, an extension of the Asset Purchase Agreement for a period of sixty (60) days from and after the date hereof and will be in full force and effect within seven (7) business days of the effective date of this Agreement pursuant to such amendment and in connection with the execution of this Agreement, which amended Asset Purchase Agreement is attached hereto as Exhibit 11.2. Player hereby agrees to permit Pam Campbell and Marc B. Player to serve on the Board of Directors of GPD on an interim basis or for a full term of office if they are elected by the shareholders of GPD. 12. Cervantes and GPD agree that Cervantes' Employment Agreement is being terminated by GPD without cause, provided, however, Cervantes agrees not to pursue or institute any action for termination without cause or otherwise under the Employment Agreement unless GPD or any Subsidiary institutes an action against Cervantes (other than an action for breach of this Agreement or any claim relating to embezzlement of GPD corporate funds or assets). In addition, neither GPD and the Subsidiaries nor Cervantes and his Spouse, may make any claim against the other for any matter pertaining to employment or directorship after the second anniversary of the effective date of this Agreement (excluding claims under the Indemnification Agreement and claims under this Agreement including claims Cervantes may have pursuant to obligations of GPD or its Subsidiaries guaranteed by Cervantes). In the event that one party to this Agreement institutes an action against another party the two year limitation referenced in the immediately preceding sentence shall not apply to the party who has been the subject of such action or proceeding. 13. The parties hereto shall not disparage or make any statements of a negative nature regarding any of the parties to this Agreement and shall be supportive of GPD and its Subsidiaries in its efforts to effectuate this Succession Plan and Agreement outlined herein. No party may issue 5 6 a press release announcing or describing this Agreement or the succession plan without the prior approval of GPD and Cervantes, which approval will not be unreasonably withheld. 14. Cervantes shall advise GPD in writing whether he chooses to exercise his COBRA rights (if any) within thirty (30) days of the date hereof. 15. The Shareholder Group, Bagley, Stone Pine, Kucher and Player hereby release, remise and forever discharge Cervantes, his Spouse, Friedland and their assigns of and from any and all existing manner of claims, damages, demands, obligations, causes of action or rights of action or claims for relief whether known or unknown at the time of the execution of this Agreement (except for any breach of this Agreement) which the Shareholder Group, Bagley, Stone Pine, Kucher and Player, may have, had or may come to have against Cervantes, his Spouse or Friedland from the beginning of the world to the date of these presents. The Shareholder Group, Bagley, Stone Pine, Kucher and Player forever covenant and agree not to commence any legal or equitable proceeding against Cervantes, his Spouse or Friedland in connection with Cervantes' or Friedland's affiliation with GPD. The within releases in this Section 15 and covenant not to sue shall also apply to any corporation (except for GPD and the Subsidiaries), partnership, limited liability or other entity controlled by the Shareholder Group, Bagley, Stone Pine, Kucher and Player. 16. The releases contained herein by the Shareholder Group, Bagley, Stone Pine, Friedland, Kucher and Player shall not include any release of Cervantes of any monies owed by Cervantes to the parties to this Agreement other than GPD and the Subsidiaries as set forth on Exhibit 16.0. 17. GPD and the parties hereto agree and acknowledge that GPD and the parties hereto shall not raise any objection to the sale by Cervantes of any common stock of GPD that he legally and rightfully owns provided Cervantes complies with all Federal and State securities laws applicable to such sales. GPD shall instruct its counsel to handle any matters with the GPD transfer agent in order to effectuate any such sales. Notwithstanding anything to the contained in this Agreement to the contrary, Cervantes recognizes and acknowledges that the Company has an extreme working capital deficit and liquidity crisis and that the sale of all the shares on any one occasion may jeopardize GPD's ability to raise critical capital. Accordingly, Cervantes agrees that he shall not sell, pursuant to Rule 144 under the Securities Act of 1933, as amended, more than 50,000 shares of his common stock during any calendar month from and after the effective date of this Agreement but all such resale restrictions shall be terminate on June 1, 2000. Cervantes may sell more than 50,000 shares in a private resale transaction provided such transferee or buyer agrees to legend the sold securities restricting them from resale until April 1, 2000. 18. Cervantes agrees that for a period of three (3) years following the date of his execution of this Agreement, he will not engage in the direct marketing of golf equipment, accessories and apparel either personally or on behalf of any company, individual, or entity with whom he may be associated in any capacity as employee, partner, owner, stockholder, member, co-venturer, principal, agent, or otherwise within the United States, Canada and any U.S. territories without the written consent of GPD. 6 7 19. Cervantes further agrees that, for a period of three (3) years, Cervantes shall not solicit business, not accept either solicited or unsolicited business, which relates to golf equipment, accessories and apparel for himself or for any company, individual, or entity with whom he may be associated as an employee, partner, owner, principal, agent, or other capacity, from any other person or entity who was an existing vendor or customer as of the date of Cervantes' execution of this Agreement without the written consent of GPD. 20. Cervantes recognizes that GPD's employees are a valuable resource of GPD. Accordingly, Cervantes agrees that for a period of three (3) years after the execution of this Agreement, Cervantes will not, alone or in conjunction with others, solicit, induce or otherwise recruit any person who is as of the date of this Agreement an employee of GPD to leave GPD's employ. 21. Cervantes understands that the provisions of paragraphs 10, 13, 17, 18, 19, 20 and 22 are material terms to this Agreement and that any breach of these provisions would result in irreparable harm and injury to GPD. Therefore, Cervantes agrees that a court may enjoin and restrain him from violating the terms of paragraphs 10, 13, 17, 18, 19, 20 and 22 without the necessity of posting a bond. 22. Cervantes recognizes that in his capacity as an officer of GPD, he had access to Highly Confidential Business Information. "Highly Confidential Business Information" is defined as unique and extraordinary information obtained by Cervantes based solely on his position with GPD. Highly Confidential Business Information is not intended to include business information that is available in the public domain or information that was possessed by Cervantes prior to his employment with GPD. Cervantes agrees that he will not and has not, at any time, disclosed, reproduced, assigned or transferred to any person, firm, corporation or other business entity, except as required by law, any Highly Confidential Business Information concerning the business, finances, client affairs, business plans, strategies, methods, devices, apparatus, preparations, results from ongoing investigation by others, and present and future plans of GPD, its subsidiaries or any company formed or funded by GPD at any time for any reason or purpose whatsoever, without GPD's express written consent, nor shall Cervantes make use of any such Highly Confidential Business Information for his own purposes or for the benefit of any person, firm, corporation or other business entity, except GPD. 23. PROVIDED NEITHER GPD NOR ANY SUBSIDIARY INSTITUTES AN ACTION AGAINST CERVANTES AND/OR HIS SPOUSE OTHER THAN FOR BREACH OF THIS AGREEMENT OR ANY CLAIM FOR EMBEZZLEMENT OF GPD CORPORATE FUNDS OR ASSETS, pursuant to the Older Worker Benefits Protection Act ("OWBPA"), Cervantes acknowledges that he waives his rights or claims only in exchange for consideration over and above any other benefits and payments to which he is otherwise entitled. The parties acknowledge that Cervantes has not been given at least twenty-one (21) days within which to consider this Agreement ("21-day consideration period"). PROVIDED NEITHER GPD NOR ANY SUBSIDIARY INSTITUTES AN ACTION AGAINST CERVANTES AND/OR HIS SPOUSE OTHER THAN FOR BREACH OF THIS AGREEMENT OR ANY CLAIM FOR EMBEZZLEMENT OF GPD CORPORATE FUNDS OR ASSETS, by signing this Agreement 7 8 before the 21-day consideration period has expired, however, Cervantes certifies that by his own interest he freely, expressly and knowingly waives the 21-day consideration period required under OWBPA. 24. Cervantes, and his Spouse, hereby for themselves, their marital community (if any), heirs, personal representatives and assigns, forever releases and discharges Player, Stone Pine, Bagley, Kucher, Friedland, the Shareholder Group and each of their successors, assigns, agents, affiliates, employees, attorneys, consultants, personal representatives, partners, officers, directors (excluding GPD and any Subsidiary) and each and every other person that is or might be liable, directly or indirectly, of and from any and all existing manner of claims, demands, causes of action and other claims for damages or relief, whether known or unknown at the time of the execution of this Agreement (except for any breach of this Agreement) from the beginning of the World to the date of these presents. Cervantes and his Spouse, hereby for themselves, their heirs, personal representatives and assigns forever covenant and agree not to commence for any reason whatsoever any legal or equitable proceeding against the Shareholder Group, Friedland, Stone Pine, Bagley, Kucher, Player and each of their successors, assigns agents, affiliates, employees, attorneys, consultants, partners, officers and directors (excluding GPD and any Subsidiary). It is the expressed understanding of the parties hereto that in consideration for the execution of this Agreement, Cervantes and his Spouse agree that they shall never commence as a shareholder, or otherwise, an action against Player, Stone Pine, Bagley, Kucher, Friedland and the Shareholder Group. The within releases in this Section 24 and covenant not to sue shall also apply to any corporation, partnership, limited liability company or other entity controlled by Cervantes and his Spouse. 25. PROVIDED NEITHER GPD NOR ANY SUBSIDIARY INSTITUTES AN ACTION AGAINST CERVANTES AND/OR HIS SPOUSE OTHER THAN FOR BREACH OF THIS AGREEMENT OR ANY CLAIM FOR EMBEZZLEMENT OF GPD CORPORATE FUNDS OR ASSETS, Cervantes will not commence a claim, lawsuit, or other cause of action against GPD or the Subsidiaries arising under Title VII of the Civil Rights Acts of 1964, as amended; the Age Discrimination in Employment Act; the Americans with Disabilities Act; the Family and Medical Leave Act; the Employee Retirement Income Security Act ("ERISA") and any applicable state law equivalent of the foregoing federal statutes; or any other applicable federal, state or local statute. 26. On the effectiveness of this Agreement, GPD shall forgive the principal plus interest of a certain loan made to Trilogy in the amount of $142,160.00 in March of 1996 that was made in lieu of fees payable to Trilogy for services rendered in connection with GPD's formation and the acquisition of Rhino Marketing, Inc. and financing activities. In addition, Mr. Cervantes hereby tenders 5,000 shares of his common stock that served as collateral for the loan for cancellation. 27. Notwithstanding any provisions to the contrary contained in this Agreement, the parties acknowledge that Cervantes is a guarantor on certain corporate obligations set forth on Exhibit 27 attached hereto on behalf of GPD and the Subsidiaries (the "Guaranteed Obligations"). GPD hereby indemnifies and holds Cervantes harmless from any loss, liability, cost or expense (including attorneys fees) in connection with any action, lawsuit, proceeding or claim made against Cervantes for payment of the Guaranteed Obligations or enforcement of the guarantees. In the event 8 9 that Cervantes is required to satisfy Guaranteed Obligations, he shall be subrogated to the rights of these creditors and shall not be precluded from commencing an action against GPD or the Subsidiaries, but not the other parties hereto, to reimburse him for any payments that he has made in connection with said corporate obligations of GPD and the Subsidiaries. Essentially Cervantes shall be subrogated to the rights of these creditors with respect to any claims against GPD and the Subsidiaries that he has in fact paid. In the event that GPD settles Guaranteed Obligations for less than the full amount of the stated claim, that has been guaranteed by Cervantes, GPD shall obtain a release in favor of Cervantes and the cancellation of his guarantee. 28. Exhibit 28 identifies shares of common stock of GPD which the Board of Directors of GPD has authorized to be issued prior to the date hereof, for which the consideration therefor has been received by GPD, but which certificates have not been issued. Cervantes and GPD represent and warrant that these shares have been duly authorized by the Board of Directors. The Shareholder Group agrees that it has no objection to the issuance of the shares to Cervantes and Friedland as set forth on Exhibit 28.0 conditioned upon the issuance of the legal opinion described herein. 29. In connection with the negotiation, preparation and execution of this Agreement during the past forty-five (45) days, GPD shall pay the legal fees of Gallagher, Briody & Butler plus disbursements. GPD acknowledges and represents that GPD has not been represented by the law firm of Gallagher, Briody & Butler or Thomas P. Gallagher but has, in fact, been represented by Saphier, Rein & Walden. GPD shall pay all legal fees and disbursements of Saphier, Rein & Walden for its representation of GPD in connection with the negotiation, preparation and execution of this Agreement. This is in addition to other legal fees owed by GPD to Saphier, Rein & Walden. 30. All notices, demands or requests required or permitted by this Agreement shall be in writing and unless otherwise specified in the written notice by the respective parties or any of them, shall be sent to the parties at their respective addresses set forth in Exhibit 30.0. 31. Each such notice, demand or request shall be sent by personal delivery, or by United States Mail registered or certified mail, return receipt requested, or by Federal Express or other similar overnight delivery service, postage prepaid or via fax, to its addressee at its address as set forth on Exhibit 30.0. Each such notice, demand or request (i) if deposited in the U.S. Mail as provided above shall be deemed to have been received by its addressee on the third (3rd) business day after the day of mailing, (ii) if so deposited with Federal Express or another similar overnight delivery service in accordance with such service's requirements for delivery on the next business day, shall be deemed to have been received by its addressee on the next business day after the day of deposit, and (iii) if sent by fax, shall be deemed to have been received by its addressee on the next business day after being sent by fax. Any notice to a party hereto shall be deemed valid if sent to the address set forth in Exhibit 30 unless written notice is sent confirming a new address for a party hereto. 32. Friedland, his heirs, personal representatives and assigns, forever releases and discharges Cervantes, his Spouse, Player, Stone Pine, Bagley, Kucher, the Shareholder Group, and each of the successors, assigns, agents, affiliates, employees, attorneys, consultants, personal representatives, partners, officers, directors and each and every other person that is or might be 9 10 liable, directly or indirectly, of and from any and all existing manner of claims, demands, causes of action and other claims for damages or relief, whether known or unknown at the time of the execution of this Agreement, (except for any breach of this Agreement) from the beginning of the World to date of these presents. Friedland, as well as his heirs, personal representatives and assigns forever covenants and agrees not to commence for any reason whatsoever any legal or equitable proceeding against Cervantes, his Spouse, the Shareholder Group, Stone Pine, Bagley, Kucher, Player, and each of their successors, assigns agents, affiliates, employees, attorneys, consultants, partners, officers and directors. It is the expressed understanding of the parties hereto that in consideration for the execution of this Agreement, Friedland agrees that he shall never commence as a shareholder, or otherwise, an action against Cervantes, his Spouse, Player, Stone Pine, Bagley, Kucher or the Shareholder Group. The within release in this Section 32 and covenant not to sue shall also apply to any corporation, partnership, limited liability company or other entity controlled by Friedland. In addition, GPD agrees that it shall issue the shares set forth on Exhibit 28.0 to Friedland as well as reimburse him $15,000.00 for amounts that he has paid on behalf of GPD as well as unpaid directors fees which shall be paid within sixty (60) days of the effectiveness of this Agreement. The Friedland Indemnification Agreement shall remain in full force and effect after the effective date of this Agreement but will not cover any claims made under this Agreement. 33. This Agreement shall become effective upon and only upon its execution and delivery by each party hereto. This Agreement represents the complete understanding among the parties hereto as to the subject matter hereof, and supersedes all prior negotiations, representations, guaranties, warranties, promises, statements or agreements, either written or oral, among them as to the same. This Agreement may be amended by and only by an instrument executed and delivered by each party hereto. No party hereto shall be deemed to have waived the exercise of any right which it holds hereunder unless such waiver is made expressly and in writing (and no delay or omission by any party hereto in exercising any such right shall be deemed a waiver of its future exercise). No such waiver made as to any instance involving the exercise of any such right shall be deemed a waiver as to any other such instance, or any other such right. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns hereunder. 34. No determination by any court, governmental body or otherwise that any provision of this Agreement or any amendment hereof is invalid or unenforceable in any instance shall affect the validity or enforceability of (a) any other such provision, or (b) such provision in any circumstance not controlled by such determination. Each such provision shall be valid and enforceable to the fullest extent allowed by, and shall be construed wherever possible as being consistent with, applicable law except as provided herein. 35. This Agreement is governed by and shall be construed under Delaware law and contains the entire agreement of the parties. If any provision of this Agreement is held to be invalid, void, or unenforceable for any reason, the remaining provisions of this Agreement shall continue in full force and effect without being impaired in any manner. 10 11 36. This Agreement may be signed in counterparts and may be signed by facsimile. Once all of the counterpart signatures are affixed to this document, whether by original signature or by facsimile, it shall be deemed effective for all purposes. 37. Cervantes and his Spouse as well as Friedland, the Shareholder Group, Kucher, Player, Bagley and Stone Pine acknowledges and agrees that the facts in respect to which any release is given pursuant to this Agreement may turn out to be other than or different than expected, and expressly, knowingly and voluntarily waives any and all benefits and rights granted pursuant to Section 1542 of the Civil Code of the State of California with which section it is familiar and which section reads as follows: "A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known to him, must have materially affected his settlement with the debtor." 38. Each party hereto understands and realizes that there may exist at this time claims herein released, the nature of which has not yet been discovered. It is expressly understood and agreed that the possibility that such claims exist has been explicitly taken into account in determining the consideration to be given for any releases contained herein and that a portion of that consideration, having been bargained for in full knowledge of the possibility of such unknown claims, was given in exchange for the releases contained herein. 39. Each party hereto represents and warrants that no claim or right that is released or dismissed under this Agreement has been transferred, hypothecated, assigned or given away by that party prior to the date of this Agreement. 40. Each of the parties represents, warrants and agrees as follows: (a) Such party has received independent legal advice from attorneys of its choice with respect to the advisability of making this settlement and of entering into this Agreement. Prior to the execution of this Agreement, the attorneys for each party reviewed this Agreement at length and had an opportunity to make any desired changes and, accordingly, this Agreement shall not be construed adversely to the draftsmen thereof. (b) Such party has made such investigation of the facts pertaining to this Agreement, and of all other matters related thereto, as such party deems necessary. (c) This Agreement has been carefully read by, the contents hereof are known and understood by, and it is signed voluntarily by, each person executing this Agreement. 11 12 (d) Each person executing this Agreement on behalf of a party warrants and represents that he is fully authorized to do so and that his signature on this Agreement shall bind said party to the terms and provisions of this Agreement. (e) This Agreement is intended to be final and binding and to be effective as a full and final accord and satisfaction of any and all disputes between the parties except as noted herein. Each party is relying upon the said finality of this Agreement as a material factor inducing said party's decision to settle said disputes. (f) None of the claims settled hereby have been transferred or assigned to a third party. [THE BALANCE OF THIS PAGE IS INTENTIONALLY LEFT BLANK] 12 13 IN WITNESS WHEREOF, the parties to this Agreement have executed this Agreement on the date indicated below. GARY PLAYER DIRECT, INC. GARY PLAYER GROUP, INC. By:/s/ Carl L. Casareto By:/s/ Marc Player -------------------------------- --------------------------------- Title: Carl L. Casareto, Title: C.E.O. Executive Vice President Dated: 10/12/99 Dated: October 13, 1999 ------------- --------------------- RHINO MARKETING, INC. GRAN PRIX MARKETING, INC. By:/s/ Carl L. Casareto By:/s/ Carl L. Casareto -------------------------------- --------------------------------- Title: Carl L. Casareto, President Title: Carl L. Casareto, President Dated: 10/12/99 Dated: 10/12/99 ------------- ------------- GARY PLAYER GOLF EQUIPMENT G.P. DIRECT, INC. By:/s/ Marc Player By:/s/ Carl L. Casareto -------------------------------- --------------------------------- Title: C.E.O. Title: Carl L. Casareto, President Dated: October 13, 1999 Dated: 10/12/99 --------------------- ------------- DIGITAL-GOLF.COM, INC. TRILOGY CAPITAL GROUP, INC. By:/s/ Carl L. Casareto By:/s/ Alfonso J. Cervantes, Jr. -------------------------------- --------------------------------- Title: Carl L. Casareto, President Title: President Dated: 10/12/99 Dated: 10/13/99 ------------- ------------- /s/ Alfonso J. Cervantes, Jr. /s/ Robert J. Friedland - ----------------------------------- ------------------------------------ ALFONSO J. CERVANTES, JR. ROBERT J. FRIEDLAND Dated: 10/13/99 Dated: 10/12/99 ------------- ------------- /s/ Judith Cervantes - ----------------------------------- JUDITH CERVANTES Dated: 10/13/99 ------------- 13 14 /s/ Thomas P. Gallagher /s/ William S. Schuler - ----------------------------------- ------------------------------------ THOMAS P. GALLAGHER, ESQ. WILLIAM S. SCHULER Dated: 10/12/99 Dated: 10/13/99 ------------- ------------- GALLAGHER, BRIODY & BUTLER /s/ Jeffrey Leach ------------------------------------ JEFFREY LEACH Dated: 10/11/99 ------------- By:/s/ Thomas P. Gallagher - ----------------------------------- THOMAS P. GALLAGHER Title: Partner STONE PINE VENTURE LENDING, Dated: 10/12/99 LLC, and its Affiliates ------------- /s/ Ritch Gaiti By:/s/ James Paul Bagley - ----------------------------------- ------------------------------------ RITCH GAITI J. PAUL BAGLEY, Individually and Dated: 10/9/99 on behalf of Stone Pine Venture ------------- Lending, LLC Dated: 10/9/99 ------------- LAVA INVESTMENTS LIMITED /s/ Gary D. Kucher ------------------------------------ GARY D. KUCHER Dated: 10/10/99 ------------- By:/s/ Roy Tashi - ----------------------------------- ROY TASHI Dated: 8 October 1999 ------------------- 14 15 EXHIBIT 3.0 MINUTES OF THE BOARD OF DIRECTORS APPOINTING NEW DIRECTORS, APPROVAL OF AGREEMENT AND APPROVAL OF INDEMNIFICATION AGREEMENTS 15 16 EXHIBIT 6.0 STOCK OWNERSHIP OF CERVANTES AND DESCRIPTION OF CONSIDERATION
ISSUED AND OUTSTANDING Description Date Issued No. of Shares ----------- ----------- ------------- Founders shares Inception of Company 202,283 Employee Compensation February 22, 1999 80,000 ------- Subtotal - Exchanged at Merger 282,283 TO BE ISSUED Directors Compensation October 2, 1999 40,000 Compensation re: personal Guarantee of company debt October 2, 1999 50,000 ------- Total 372,283 TO BE CANCELLED 5,000 Net Shares of Cervantes 367,283 =======
16 17 EXHIBIT 6.1 PENDING OR THREATENED LITIGATION CLAIMS 1. Ahuja, Monte 2. Bergman, Murphy, Trebek 3. Bridge Lenders (Defaults) 4. California District Attorney's Office 5. California State Labor Board 6. Cancellieri, Jack 7. Cardservice International 8. Comstream International 9. Cozier, Cliff 10. Digital Telecommunications 11. Direct Media 12. Eaton Corporation 13. EDD - State of California 14. Frontier Telecommunications 15. Fugro West 16. Garcia, Diana 17. GMAC 18. Graffaloy, LP 19. Guerin, Bruce 20. Higgins Family Limited Partnership 21. Holiday Inn 22. IRS 23. Krausman, Kent 24. NEC 25. Nissho Iwai and Affiliates 26. Numerous Unsecured Creditors 27. Packacquisition Corporation 28. Pollet and Woodbury 29. Sparks, Dana 30. Stephenson 31. Towbes 32. Toyota Credit 33. UPS 34. Michael Woodward 35. Henry Muir 17 18 36. Poor Richards Press 37. Viking Freight 38. Marshall & Stevens 39. Larry Harris 40. Office Depot 41. Williams 42. State of California - Department of Justice 43. Prime Time Sports TV 44. Spalding and EvenFlo Companies * For Information Purposes Only 18 19 EXHIBIT 11.0 AMENDED LICENSE AGREEMENT BETWEEN PLAYER AND GPD [TO BE DELIVERED POST-AGREEMENT] 19 20 EXHIBIT 11.1 OUTSTANDING CLAIMS FOR UNPAID ROYALTIES AND LICENSE FEES OF PLAYER OWING FROM GPD The total amount outstanding as of September 30, 1999 as requested by Player is $474,225.59 plus $50,000.00 of expenses payable to Marc B. Player. 20 21 EXHIBIT 11.2 AMENDED ASSET PURCHASE AGREEMENT OF PLAYER AND GPD [TO BE DELIVERED POST-AGREEMENT] 21 22 EXHIBIT 16.0 MONIES OWING TO THE SHAREHOLDER GROUP BY CERVANTES 1. Jeffrey Leach is owed $20,000.00 plus interest. 22 23 EXHIBIT 27 OBLIGATIONS THAT CERVANTES HAS GUARANTEED ON BEHALF OF GPD 1. Bergman, Murphy, Trebek-loans 2. Capital Fund Leasing, LLC-loan 3. Cardservice International, Inc.-merchant account 4. Richard Casey-bridge loan 5. Michael Freilich, MD-bridge loan 6. Tom Imming-bridge loan 7. Mid-America Agency-bridge loan 8. Andrew and Sally Pollet-loan 9. Lava Investments, Roy Tashi-loan 23 24 EXHIBIT 28 SHARES TO BE ISSUED BY GPD PRIOR TO CERVANTES RESIGNATION
NUMBER ------ OF -- SHAREHOLDER SHARES ----------- ------ 1. Ace Investors, LLC 25,000 c/o Norman A. Kunin 154 Abbey Road Santa Maria, CA 93455 2. Alfonso J. Cervantes, Jr. 90,000 2100 N. Broadway, #234 Santa Maria, CA 93454 3. Andrew Furukawa 3,500* 1213 Cobblestone Lane Santa Maria, CA 93454 4. Brian H. McPhearson 3,500* c/o Gary Player Direct, Inc. 710 Aerovista Lane, Suite B San Luis Obispo, CA 93401 5. Charles Motley 3,500* c/o Gary Player Direct, Inc. 710 Aerovista Lane, Suite B San Luis Obispo, CA 93401 6. Chris Avila 3,500* c/o Gary Player Direct, Inc. 710 Aerovista Lane, Suite B San Luis Obispo, CA 93401 7. Eric Hall 1,000 c/o Gary Player Direct, Inc. 710 Aerovista Lane, Suite B San Luis Obispo, CA 93401
24 25 8. Hollander Family Trust 10,000 1610 Valley Meadow Place Encino, CA 91436 9. Hyman Harris Irrevocable Trust 10,000 4140 Aleman Drive Tarzana, CA 91356 10. James Zawacki 500 3635 Foothill Road Santa Barbara, CA 93105 11. Jerome Hollander 10,000 1610 Valley Meadow Place Encino, CA 91436 12. John Martin Kealy 150,000 c/o The Brinton Group Liberty Square 287 Silom Road Bangrak 10500 Bangkok, Thailand 13. Kenneth J. Richland IRA 20,000 18757 Hatteras Street, Suite 21 Tarzana, CA 91356 14. Kent Krausman 30,000 6260 S. University Blvd. Littleton, CO 80121 15. Larry Van Kirk 2,000 c/o Gary Player Direct, Inc. 710 Aerovista Lane, Suite B San Luis Obispo, CA 93401 16. Michael I. Freilich 25,000 8737 Beverly Blvd. Los Angeles, CA 90048 17. Mid-America Agency, Inc. 40,000 52 Maryland Plaza St Louis, MO 63180
25 26 18. Monte Stern 20,000 4219 Valley Meadow Road Encino, CA 91436 19. Nick Chamberlain 3,500* c/o Gary Player Direct, Inc. 710 Aerovista Lane, Suite B San Luis Obispo, CA 93401 20. Patrick Beck 3,500* Highway #1, I-134 Oceano, CA 93455 21. Richard Casey 25,000 232 N. Kingshighway St. Louis, MO 63108 22. Robert J. Friedland 80,000 380 S. San Rafael Avenue Pasadena, CA 91105 23. Robert Weingarten 5,000 5439 Lock Hurst Drive Woodland Hills, CA 91367 24. Roger Armstrong 2,000* c/o Gary Player Direct, Inc. 710 Aerovista Lane, Suite B San Luis Obispo, CA 93401 25. Sheldon I. Silver 3,000 3670 Reina Court Calabasas, CA 91302 26. Thomas P. Gallagher 60,000 c/o Gallagher, Briody & Butler 212 Carnegie Center, Suite 402 Princeton, NJ 08540 27. Thomas P. Gallagher 43,710 c/o Gallagher, Briody & Butler 212 Carnegie Center, Suite 402 Princeton, NJ 08540
26 27 28. Ritch Gaiti 16,000 559 Provinceline Road Hopewell, NJ 08525 29. Ritch Gaiti 11,365 559 Provinceline Road Hopewell, NJ 08525 30. William Schuler 24,000 Schuler Associates 41 Tamarack Circle Skillman, NJ 08558 31. William Schuler 17,484 Schuler Associates 41 Tamarack Circle Skillman, NJ 08558 32. Tamara Toohey 3,500* 3860 S. Higuera, B-21 San Luis Obispo, CA 93401 33. Tom Imming 5,000 3120 San Fernado Road Atascadero, CA 93420 34. Roy Tashi/Lava Investments 20,000 Level 50, 101 Collins Street Melbourne, Victoria 3000 Australia 35. Cliff Cozier 50,000 Cozier & Associates, P.C. 7430 E. Caley Avenue, Suite 100 Englewood, CO 80111 36. Robert Rein, Esq. 50,000 Saphier, Rein & Walden 1901 Avenue of the Stars Suite 1060 Los Angeles, CA 90067
* Note: Conditioned upon nine months continuous employment. 27 28 EXHIBIT 30.0 ADDRESSES OF ALL PARTIES Alfonso J. Cervantes, Jr. Gallagher, Briody & Butler 2100 North Broadway 212 Carnegie Center, Suite 402 #234 Princeton, NJ 08540 Santa Maria, CA 93454 Robert J. Friedland William S. Schuler 380 S. San Rafael Avenue Schuler Associates Pasadena, CA 91105 41 Tamarack Circle Skillman, NJ 08558 Gary Player Direct, Inc. Ritch Gaiti 710 Aerovista, Suite B 559 Provinceline Road San Luis Obispo, CA 93401 Hopewell, NJ 08525 Rhino Marketing, Inc. Jeffrey Leach 710 Aerovista, Suite B Stone Pine Investment Banking San Luis Obispo, CA 93401 31 South Street, Suite 201 Morristown, NJ 07960 G. P. Direct, Inc. Roy Tashi 710 Aerovista, Suite B Lava Investments Limited San Luis Obispo, CA 93401 Level 50, 101 Collins Street Melbourne, Victoria 3000 Australia Gran Prix Marketing, Inc. Gary Player Golf Equipment Company 710 Aerovista, Suite B 3930 RCA Boulevard, Suite 3001 San Luis Obispo, CA 93401 Palm Beach Gardens, FL 33410 Thomas P. Gallagher The Gary Player Group Gallagher, Briody & Butler 3930 RCA Boulevard, Suite 3001 212 Carnegie Center, Suite 402 Palm Beach Gardens, FL 33410 Princeton, NJ 08540 28 29 Gary K. Kucher Digital-Golf.com, Inc. Investors Capital Enterprises 710 Aerovista, Suite B 10660 Wilshire Blvd., Suite 1504 San Luis Obispo, CA 93401 Los Angeles, CA 90024 Stone Pine Venture Lending, LLC J. Paul Bagley 410 17th Street, Suite 400 410 17th Street, Suite 400 Denver, CO 80202 Denver, CO 80202 29 EX-10.2 3 INDEMNIFICATION AGREEMENT W/ THOMAS P. GALLAGHER 1 Exhibit 10.2 INDEMNIFICATION AGREEMENT This INDEMNIFICATION AGREEMENT ("Agreement") is made as of this 14th day of October, 1999, by and between GARY PLAYER DIRECT, INC., a Delaware corporation located at 710 Aerovista, Suite B, San Luis Obispo, California 93401 (the "Company"), and THOMAS P. GALLAGHER ("Indemnitee"). RECITALS A. The Company and Indemnitee recognize the increasing difficulty in obtaining suitable liability insurance for directors, officers, employees and agents, the significant increases in the cost of such insurance and the general reductions in the coverage of such insurance. B. The Company and Indemnitee further recognize the substantial increase in corporate litigation in general, subjecting directors, officers, employees, and agents to expensive litigation risk at the same time that the availability and coverage of liability insurance has been severely limited. C. Indemnitee does not regard the current protection available as adequate under the present circumstances, and Indemnitee and other directors, officers, employers and agents of the Company may not be willing to continue to serve as directors, officers, employees and agents without additional protection. D. The Company desires to attract and retain the services of highly qualified individuals, such as Indemnitee, to serve as directors, officers, employees and agents of the Company and to indemnify its directors, officers, employees and agents so as to provide them with the maximum protection permitted by law. E. The Company, through its Board of Directors, approved this Agreement on the 12th day of October, 1999. AGREEMENT The Company and Indemnitee hereby agree as follows: 1. AGREEMENT TO SERVE. Indemnitee agrees to serve and continue to serve the Company, at the Company's will (or under separate written agreement approved by the Board of Directors of the Company, if such agreement exists), in the capacity Indemnitee currently serves the Company, as long as Indemnitee is duly appointed or elected and qualified in accordance with the applicable provisions of the By-Laws of the Company or any subsidiary of the Company or (subject to any employment agreement between Indemnitee and the Company) until such time as Indemnitee tenders a written resignation or is removed in accordance with the By-Laws; provided, however, that nothing contained in this Agreement is intended to or shall create any right (express or implied) to continued employment by Indemnitee. 2 2. INDEMNIFICATION. (a) THIRD PARTY PROCEEDINGS. The Company shall indemnify Indemnitee if Indemnitee is or was a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Company) by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, by reason of any action or inaction on the part of Indemnitee while a director, officer, employee or agent, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations), judgments, fines and amounts paid in settlement (if such settlement is approved in advance by the Company) actually and reasonably incurred by Indemnitee in connection with such action, suit or proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe Indemnitee's conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had reasonable cause to believe that Indemnitee's conduct was unlawful. (b) PROCEEDINGS BY OR IN THE RIGHT OF THE COMPANY. The Company shall indemnify Indemnitee if Indemnitee was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Company or any subsidiary of the Company to procure a judgment in its favor by reason of the fact the Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, by reason of any action or inaction on the part of Indemnitee while a director, officer, employee or agent, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations) and, to the fullest extent permitted by law, amounts paid in settlement, in each case to the extent actually and reasonably incurred by Indemnitee in connection with the defense or settlement of such action or suit (i) if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company and its stockholders, except that no indemnification shall be made in respect of any claim, issue or matter as to which Indemnitee shall have been adjudged to be liable to the Company in the performance of Indemnitee's duty to the Company and its stockholders unless and only to the extent that the court in which such action or suit is or was pending shall determine upon application that, in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for expenses and then only to the extent that the court shall determine; (ii) if Indemnitee is a director, to the extent that the action or contemplated action seeks monetary damages for breach of Indemnitee's duties to the Company and its stockholders in circumstances under which Indemnitee's personal liability therefor has been 2 3 eliminated as a result of the provisions of Section 102(b)(7) of the Delaware General Corporation Law; or (iii) if Indemnitee is an agent other than a director, to the extent that, were Indemnitee a director, Indemnitee would have the right to be indemnified under Section 2(b)(ii), above; and in the case of Sections 2(b)(ii) and 2(b)(iii) above, indemnification shall include, to the extent not prohibited by law, indemnification against all judgments, fines and amounts paid in settlement actually and reasonably incurred by Indemnitee in connection with such action, suit or proceeding. (c) MANDATORY PAYMENT OF EXPENSES. To the extent that Indemnitee has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Sections 2(a) or (b) or in defense of any claim, issue or matter therein, Indemnitee shall be indemnified against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations) actually and reasonably incurred by Indemnitee in connection therewith. (d) INDEMNIFICATION FOR SERVING AS A WITNESS. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of Indemnitee's status as a director, officer, employee or agent of the Company, a witness in any action, suit or proceeding, whether civil, criminal, administrative or investigative, Indemnitee shall be indemnified against expenses actually and reasonably incurred by Indemnitee in connection therewith. 3. EXPENSES; INDEMNIFICATION PROCEDURE. (a) ADVANCEMENT OF EXPENSES. The Company shall advance all reasonable expenses incurred by Indemnitee in connection with the investigation, defense, settlement or appeal of any civil, criminal, administrative or investigative action, suit or proceeding referenced in Sections 2(a) or (b) hereof (but not amounts actually paid in settlement of any such action, suit or proceeding). Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it shall ultimately be determined that Indemnitee is not entitled to be indemnified by the Company as authorized hereby. (b) NOTICE/COOPERATION BY INDEMNITEE. Indemnitee shall, as a condition precedent to his right to indemnified under this Agreement, give the Company notice, in accordance with Section 14 hereof, of any claim made against Indemnitee for which indemnification will or could be sought under this Agreement. Notice to the Company shall be directed to the appropriate officer of the Company. In addition, Indemnitee shall give the Company such information and cooperation as it may reasonably require and as shall be within Indemnitee's power. (c) PROCEDURE. Any indemnification and advances provided for in Section 2 and this Section 3 shall be made no later than thirty (30) days after receipt of the written request of Indemnitee. If a claim under this Agreement, under any statute, or under any provision of the Company's Certificate of Incorporation or By-Laws providing for indemnification, is not paid in full by the Company within thirty (30) days after a written request for payment thereof has first been received by the Company, Indemnitee may, but need not, at any time thereafter bring an action against the Company to recover the unpaid amount of the claim and, subject to Section 13 of this Agreement, Indemnitee shall also be entitled to be paid for the expenses (including attorneys' fees) 3 4 of bringing such action. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in connection with any action, suit or proceeding in advance of its final disposition) that Indemnitee has not met the standards of conduct which make it permissible under applicable law for the Company to indemnify Indemnitee. Indemnitee shall be entitled to receive interim payments of expenses pursuant to Section 3(a) unless and until such defense may be finally adjudicated by court order or judgment from which no further right of appeal exists. It is the intention of the parties that if the Company contests Indemnitee's right to indemnification, the question of Indemnitee's right to indemnification shall be for the court to decide, and neither the failure of the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) to have made a determination that indemnification of Indemnitee is proper in the circumstances because Indemnitee has met the applicable standard of conduct required by applicable law, nor an actual determination by the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) that Indemnitee has not met such applicable standard of conduct, shall create a presumption that Indemnitee has or has not met the applicable standard of conduct. (d) NOTICE TO INSURERS. If, at the time of the receipt of a notice of a claim pursuant to Section 3(b) hereof, the Company has director and officer liability insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies. (e) SELECTION OF COUNSEL. In the event the Company shall be obligated under Section 3(a) hereof to pay the expenses of any proceedings against Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by Indemnitee, upon the delivery to Indemnitee of written notice of its election so to do. After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees of counsel subsequently incurred by Indemnitee with respect to the same proceeding, provided that (i) Indemnitee shall have the right to employ separate counsel in any such proceeding at Indemnitee's expense; and (ii) if (A) the employment of counsel by Indemnitee has been previously authorized by the Company, (B) Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and Indemnitee in the conduct of any such defense, or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then the fees and expenses of Indemnitee's counsel shall be at the expense of the Company. 4. ADDITIONAL INDEMNIFICATION RIGHTS; NON-EXCLUSIVITY. (a) SCOPE. Notwithstanding any other provision of this Agreement, the Company hereby agrees to indemnify the Indemnitee to the fullest extent permitted by law, notwithstanding that such indemnification is not specifically authorized by the other provisions of this Agreement, the Company's Certificate of Incorporation, the Company's By-Laws or by statute. In the event of any change in any applicable law, statute or rule which narrows the right of a Delaware corporation 4 5 to indemnify a member of its board of directors or its officers, employees or agents, such change, to the extent not otherwise required by such law, statute or rule to be applied to this Agreement, shall have no effect on this Agreement or the parties' rights and obligations hereunder. (b) NON-EXCLUSIVITY. The indemnification provided by this Agreement shall not be deemed exclusive of any rights to which Indemnitee may be entitled under the Company's Certificate of Incorporation, By-Laws, any agreement, any vote of stockholders or disinterested Directors, the Delaware General Corporation Law or otherwise, both as to action in Indemnitee's official capacity and as to action in another capacity while holding such office. The indemnification provided under this Agreement shall continue as to Indemnitee for any action taken or not taken while serving in an indemnified capacity even though he may have ceased to serve in such capacity at the time of any action, suit or other covered proceeding. 5. PARTIAL INDEMNIFICATION. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of the expenses, judgments, fines or penalties actually or reasonably incurred by him in the investigation, defense, appeal or settlement of any civil or criminal action, suit or proceeding, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion of such expenses, judgments, fines or penalties to which Indemnitee is entitled. 6. MUTUAL ACKNOWLEDGMENT. Both the Company and Indemnitee acknowledge that in certain instances, Federal law or applicable public policy may prohibit the Company from indemnifying its directors, officers, employees and/or agents under this Agreement or otherwise. Indemnitee understands and acknowledges that the Company has undertaken or may be required in the future to undertake with the Securities and Exchange Commission to submit the question of indemnification to a court in certain circumstances for a determination of the Company's right under public policy to indemnify Indemnitee. 7. LIABILITY INSURANCE. If the Company does not maintain a policy or policies of officers and directors liability insurance with a reputable insurance company or companies, upon written request of Indemnities, the Company shall, from time to time, make the good faith determination whether or not it is practicable for the Company to obtain and maintain such a policy or policies of insurance. Officers and directors liability insurance would cover, among other things, coverage for losses from wrongful acts and/or to ensure the Company's performance of its obligations under this Agreement. The Company shall not be obligated to make such determination more than once in any 12-month period based on written requests from Indemnities and any other persons with similar rights. Among other considerations, the Company will weigh the costs of obtaining such insurance coverage against the protection afforded by such coverage. In all such policies of liability insurance, Indemnitee shall be named as an insured in such a manner as to provide Indemnitee the same rights and benefits as are accorded to the most favorably insured of the Company's directors, if Indemnitee is a director; or of the Company's officers, if Indemnitee is not a director of the Company but is an officer; or of the Company's employees, if Indemnitee is not a director or officer but is an employee; or of the Company's agents, if Indemnitee is not a director, officer or employee but is an agent. Notwithstanding the foregoing, the Company shall have no obligation to obtain or maintain such insurance if the Company determines in good faith that such 5 6 insurance is not reasonably available, if the premium costs for such insurance are disproportionate to the amount of coverage provided, if the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit, or if Indemnitee is covered by similar insurance maintained by a subsidiary or parent of the Company. 8. SEVERABILITY. Nothing in this Agreement is intended to require or shall be construed as requiring the Company to do or fail to do any act in violation of applicable law. The Company's inability, pursuant to court order, to perform its obligations under this Agreement shall not constitute a breach of this Agreement. The provisions of this Agreement shall be severable as provided in this Section 8. If this Agreement or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify Indemnitee to the full extent permitted by any applicable portion of this Agreement that shall not have been invalidated, and the balance of this Agreement not so invalidated shall be enforceable in accordance with its terms. 9. EXCEPTIONS. Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement: (a) CLAIMS INITIATED BY INDEMNITEE. To indemnify or advance expenses to Indemnitee with respect to proceedings or claims initiated or brought voluntarily by Indemnitee and not by way of defense, except with respect to proceedings brought to establish or enforce a right to indemnification under this Agreement or any other statute or otherwise as required under Section 145 of the Delaware General Corporation Law, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board of Directors has approved the initiation or bringing of such suit; (b) LACK OF GOOD FAITH. To indemnify Indemnitee for any expenses incurred by the Indemnitee with respect to any proceeding instituted by Indemnitee to enforce or interpret this Agreement, if a court of competent jurisdiction determines that each of the material assertions made by the Indemnitee in such proceeding was not made in good faith or was frivolous; (c) INSURED CLAIMS. To indemnity Indemnitee for expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise tax or penalties, and amounts paid in settlement) which have been paid directly to Indemnitee by an insurance carrier under a policy of officers' and directors' liability insurance or other policy of insurance maintained by the Company; (d) CLAIMS UNDER SECTION 16(b). To indemnify Indemnitee for expenses and the payment of profits arising from the purchase and sale by Indemnitee or securities in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute; (e) UNLAWFUL CLAIMS. To indemnify Indemnitee in any manner which is contrary to public policy or which a court of competent jurisdiction has finally determined to be unlawful; 6 7 (f) FAILURE TO SETTLE PROCEEDING. To indemnify Indemnitee for liabilities in excess of the total amount at which settlement reasonably could have been made, or for any cost and/or expenses incurred by Indemnitee following the time such settlement reasonably could have been effected, if Indemnitee shall have unreasonably delayed, refused or failed to enter into a settlement or any action, suit or proceeding (or investigation or appeal thereof) recommended in good faith, in writing, by the Company; or (g) BREACH OF EMPLOYMENT AGREEMENT. To indemnify Indemnitee for any breach by Indemnitee of any employment agreement between Indemnitee and the Company or any of its subsidiaries. 10. CONSTRUCTION OF CERTAIN PHRASES. For purposes of this Agreement, references to the "Company" shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, employees and/or agents, so that if Indemnitee is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, Indemnitee shall stand in the same position under the provisions of this Agreement with respect to the resulting or surviving corporation as Indemnitee would have with respect to such constituent corporation if its separate existence had continued. For purposes of this Agreement, references to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on Indemnitee with respect to an employee benefit plan; and references to "serving at the request of the Company" shall include any service as a director, officer, employee or agent of the Company or any subsidiary of the Company which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants, or beneficiaries; and if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan, Indemnitee shall be deemed to have acted in a manner "not opposed to the best interest of the Company" as referred to in this Agreement. 11. COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which shall constitute an original. 12. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the Company and its successors and assigns, and shall inure to the benefit of Indemnitee and Indemnitee's estate, heirs, legal representatives and assigns. 13. ATTORNEY'S FEES. In the event that any action is instituted by Indemnitee under this Agreement to enforce or interpret any of the terms hereof, Indemnitee shall be entitled to be paid all court costs and expenses, including reasonable attorneys' fees, incurred by Indemnitee with respect to such action, unless as a part of such action, the court of competent jurisdiction determines that 7 8 each of the material assertions made by Indemnitee as a basis for such action were not made in good faith or were frivolous. In the event of an action instituted by or in the name of the Company under this Agreement to enforce or interpret any of the terms of this Agreement, Indemnitee shall be entitled to be paid all court costs and expenses, including attorneys' fees, incurred by Indemnitee in defense of such action (including with respect to Indemnitee's counterclaims and cross-claims made in such action), unless as a part of such action the court determines the each of Indemnitee's material defenses to such action were made in bad faith or were frivolous. 14. NOTICE. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) if delivered by hand and receipted for by the party addressee, on the date of such receipt, or (ii) if mailed by domestic certified or registered mail with postage prepaid, on the third business day after the date postmarked. Addresses for notice to either party are as shown on the signature page of this Agreement, or as subsequently modified by written notice. 15. CONSENT TO JURISDICTION. The Company and Indemnitee each hereby irrevocably consent to the jurisdiction of the courts of the State of New Jersey for all purposes in connection with any action or proceeding which arises out of or relates to this Agreement and agree that any action instituted under this Agreement shall be brought only in the state courts of the State of New Jersey, or in Federal courts located in such State. 16. CHOICE OF LAW. This Agreement shall be governed by and its provisions construed in accordance with the laws of the State of Delaware. 17. CALIFORNIA LAW. To the extent that the Company is subject to the provisions of Section 317 of the California General Corporation Law pursuant to Section 2115 of the California General Corporation Law, nothing in this Agreement shall be deemed to require the Company to take any action which would cause it to be in violation of Section 317 of the California General Corporation Law. 8 9 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. GARY PLAYER DIRECT, INC., a Delaware Corporation. By: /s/ Carl L. Casareto --------------------------------------- Name: Carl L. Casareto Title: Executive Vice President Address: 710 Aerovista, Suite B San Luis Obispo, California 93401 AGREED TO AND ACCEPTED: INDEMNITEE: /s/ Thomas P. Gallagher - ------------------------------- THOMAS P. GALLAGHER Address: Gallagher, Briody & Butler 212 Carnegie Center, Suite 402 Princeton, New Jersey 08540 9 EX-10.3 4 INDEMNIFICATION AGREEMENT W/MARC B. PLAYER 1 Exhibit 10.3 INDEMNIFICATION AGREEMENT This INDEMNIFICATION AGREEMENT ("Agreement") is made as of this 14th day of October, 1999, by and between GARY PLAYER DIRECT, INC., a Delaware corporation located at 710 Aerovista, Suite B, San Luis Obispo, California 93401 (the "Company"), and MARC B. PLAYER ("Indemnitee"). RECITALS A. The Company and Indemnitee recognize the increasing difficulty in obtaining suitable liability insurance for directors, officers, employees and agents, the significant increases in the cost of such insurance and the general reductions in the coverage of such insurance. B. The Company and Indemnitee further recognize the substantial increase in corporate litigation in general, subjecting directors, officers, employees, and agents to expensive litigation risk at the same time that the availability and coverage of liability insurance has been severely limited. C. Indemnitee does not regard the current protection available as adequate under the present circumstances, and Indemnitee and other directors, officers, employers and agents of the Company may not be willing to continue to serve as directors, officers, employees and agents without additional protection. D. The Company desires to attract and retain the services of highly qualified individuals, such as Indemnitee, to serve as directors, officers, employees and agents of the Company and to indemnify its directors, officers, employees and agents so as to provide them with the maximum protection permitted by law. E. The Company, through its Board of Directors, approved this Agreement on the 12th day of October, 1999. AGREEMENT The Company and Indemnitee hereby agree as follows: 1. AGREEMENT TO SERVE. Indemnitee agrees to serve and continue to serve the Company, at the Company's will (or under separate written agreement approved by the Board of Directors of the Company, if such agreement exists), in the capacity Indemnitee currently serves the Company, as long as Indemnitee is duly appointed or elected and qualified in accordance with the applicable provisions of the By-Laws of the Company or any subsidiary of the Company or (subject to any employment agreement between Indemnitee and the Company) until such time as Indemnitee tenders a written resignation or is removed in accordance with the By-Laws; provided, however, that nothing contained in this Agreement is intended to or shall create any right (express or implied) to continued employment by Indemnitee. 2 2. INDEMNIFICATION. (a) THIRD PARTY PROCEEDINGS. The Company shall indemnify Indemnitee if Indemnitee is or was a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Company) by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, by reason of any action or inaction on the part of Indemnitee while a director, officer, employee or agent, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations), judgments, fines and amounts paid in settlement (if such settlement is approved in advance by the Company) actually and reasonably incurred by Indemnitee in connection with such action, suit or proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe Indemnitee's conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had reasonable cause to believe that Indemnitee's conduct was unlawful. (b) PROCEEDINGS BY OR IN THE RIGHT OF THE COMPANY. The Company shall indemnify Indemnitee if Indemnitee was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Company or any subsidiary of the Company to procure a judgment in its favor by reason of the fact the Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, by reason of any action or inaction on the part of Indemnitee while a director, officer, employee or agent, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations) and, to the fullest extent permitted by law, amounts paid in settlement, in each case to the extent actually and reasonably incurred by Indemnitee in connection with the defense or settlement of such action or suit (i) if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company and its stockholders, except that no indemnification shall be made in respect of any claim, issue or matter as to which Indemnitee shall have been adjudged to be liable to the Company in the performance of Indemnitee's duty to the Company and its stockholders unless and only to the extent that the court in which such action or suit is or was pending shall determine upon application that, in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for expenses and then only to the extent that the court shall determine; (ii) if Indemnitee is a director, to the extent that the action or contemplated action seeks monetary damages for breach of Indemnitee's duties to the Company and its stockholders in circumstances under which Indemnitee's personal liability therefor has been 2 3 eliminated as a result of the provisions of Section 102(b)(7) of the Delaware General Corporation Law; or (iii) if Indemnitee is an agent other than a director, to the extent that, were Indemnitee a director, Indemnitee would have the right to be indemnified under Section 2(b)(ii), above; and in the case of Sections 2(b)(ii) and 2(b)(iii) above, indemnification shall include, to the extent not prohibited by law, indemnification against all judgments, fines and amounts paid in settlement actually and reasonably incurred by Indemnitee in connection with such action, suit or proceeding. (c) MANDATORY PAYMENT OF EXPENSES. To the extent that Indemnitee has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Sections 2(a) or (b) or in defense of any claim, issue or matter therein, Indemnitee shall be indemnified against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations) actually and reasonably incurred by Indemnitee in connection therewith. (d) INDEMNIFICATION FOR SERVING AS A WITNESS. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of Indemnitee's status as a director, officer, employee or agent of the Company, a witness in any action, suit or proceeding, whether civil, criminal, administrative or investigative, Indemnitee shall be indemnified against expenses actually and reasonably incurred by Indemnitee in connection therewith. 3. EXPENSES; INDEMNIFICATION PROCEDURE. (a) ADVANCEMENT OF EXPENSES. The Company shall advance all reasonable expenses incurred by Indemnitee in connection with the investigation, defense, settlement or appeal of any civil, criminal, administrative or investigative action, suit or proceeding referenced in Sections 2(a) or (b) hereof (but not amounts actually paid in settlement of any such action, suit or proceeding). Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it shall ultimately be determined that Indemnitee is not entitled to be indemnified by the Company as authorized hereby. (b) NOTICE/COOPERATION BY INDEMNITEE. Indemnitee shall, as a condition precedent to his right to indemnified under this Agreement, give the Company notice, in accordance with Section 14 hereof, of any claim made against Indemnitee for which indemnification will or could be sought under this Agreement. Notice to the Company shall be directed to the appropriate officer of the Company. In addition, Indemnitee shall give the Company such information and cooperation as it may reasonably require and as shall be within Indemnitee's power. (c) PROCEDURE. Any indemnification and advances provided for in Section 2 and this Section 3 shall be made no later than thirty (30) days after receipt of the written request of Indemnitee. If a claim under this Agreement, under any statute, or under any provision of the Company's Certificate of Incorporation or By-Laws providing for indemnification, is not paid in full by the Company within thirty (30) days after a written request for payment thereof has first been received by the Company, Indemnitee may, but need not, at any time thereafter bring an action against the Company to recover the unpaid amount of the claim and, subject to Section 13 of this Agreement, Indemnitee shall also be entitled to be paid for the expenses (including attorneys' fees) 3 4 of bringing such action. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in connection with any action, suit or proceeding in advance of its final disposition) that Indemnitee has not met the standards of conduct which make it permissible under applicable law for the Company to indemnify Indemnitee. Indemnitee shall be entitled to receive interim payments of expenses pursuant to Section 3(a) unless and until such defense may be finally adjudicated by court order or judgment from which no further right of appeal exists. It is the intention of the parties that if the Company contests Indemnitee's right to indemnification, the question of Indemnitee's right to indemnification shall be for the court to decide, and neither the failure of the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) to have made a determination that indemnification of Indemnitee is proper in the circumstances because Indemnitee has met the applicable standard of conduct required by applicable law, nor an actual determination by the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) that Indemnitee has not met such applicable standard of conduct, shall create a presumption that Indemnitee has or has not met the applicable standard of conduct. (d) NOTICE TO INSURERS. If, at the time of the receipt of a notice of a claim pursuant to Section 3(b) hereof, the Company has director and officer liability insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies. (e) SELECTION OF COUNSEL. In the event the Company shall be obligated under Section 3(a) hereof to pay the expenses of any proceedings against Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by Indemnitee, upon the delivery to Indemnitee of written notice of its election so to do. After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees of counsel subsequently incurred by Indemnitee with respect to the same proceeding, provided that (i) Indemnitee shall have the right to employ separate counsel in any such proceeding at Indemnitee's expense; and (ii) if (A) the employment of counsel by Indemnitee has been previously authorized by the Company, (B) Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and Indemnitee in the conduct of any such defense, or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then the fees and expenses of Indemnitee's counsel shall be at the expense of the Company. 4. ADDITIONAL INDEMNIFICATION RIGHTS; NON-EXCLUSIVITY. (a) SCOPE. Notwithstanding any other provision of this Agreement, the Company hereby agrees to indemnify the Indemnitee to the fullest extent permitted by law, notwithstanding that such indemnification is not specifically authorized by the other provisions of this Agreement, the Company's Certificate of Incorporation, the Company's By-Laws or by statute. In the event of any change in any applicable law, statute or rule which narrows the right of a Delaware corporation 4 5 to indemnify a member of its board of directors or its officers, employees or agents, such change, to the extent not otherwise required by such law, statute or rule to be applied to this Agreement, shall have no effect on this Agreement or the parties' rights and obligations hereunder. (b) NON-EXCLUSIVITY. The indemnification provided by this Agreement shall not be deemed exclusive of any rights to which Indemnitee may be entitled under the Company's Certificate of Incorporation, By-Laws, any agreement, any vote of stockholders or disinterested Directors, the Delaware General Corporation Law or otherwise, both as to action in Indemnitee's official capacity and as to action in another capacity while holding such office. The indemnification provided under this Agreement shall continue as to Indemnitee for any action taken or not taken while serving in an indemnified capacity even though he may have ceased to serve in such capacity at the time of any action, suit or other covered proceeding. 5. PARTIAL INDEMNIFICATION. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of the expenses, judgments, fines or penalties actually or reasonably incurred by him in the investigation, defense, appeal or settlement of any civil or criminal action, suit or proceeding, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion of such expenses, judgments, fines or penalties to which Indemnitee is entitled. 6. MUTUAL ACKNOWLEDGMENT. Both the Company and Indemnitee acknowledge that in certain instances, Federal law or applicable public policy may prohibit the Company from indemnifying its directors, officers, employees and/or agents under this Agreement or otherwise. Indemnitee understands and acknowledges that the Company has undertaken or may be required in the future to undertake with the Securities and Exchange Commission to submit the question of indemnification to a court in certain circumstances for a determination of the Company's right under public policy to indemnify Indemnitee. 7. LIABILITY INSURANCE. If the Company does not maintain a policy or policies of officers and directors liability insurance with a reputable insurance company or companies, upon written request of Indemnities, the Company shall, from time to time, make the good faith determination whether or not it is practicable for the Company to obtain and maintain such a policy or policies of insurance. Officers and directors liability insurance would cover, among other things, coverage for losses from wrongful acts and/or to ensure the Company's performance of its obligations under this Agreement. The Company shall not be obligated to make such determination more than once in any 12-month period based on written requests from Indemnities and any other persons with similar rights. Among other considerations, the Company will weigh the costs of obtaining such insurance coverage against the protection afforded by such coverage. In all such policies of liability insurance, Indemnitee shall be named as an insured in such a manner as to provide Indemnitee the same rights and benefits as are accorded to the most favorably insured of the Company's directors, if Indemnitee is a director; or of the Company's officers, if Indemnitee is not a director of the Company but is an officer; or of the Company's employees, if Indemnitee is not a director or officer but is an employee; or of the Company's agents, if Indemnitee is not a director, officer or employee but is an agent. Notwithstanding the foregoing, the Company shall have no obligation to obtain or maintain such insurance if the Company determines in good faith that such 5 6 insurance is not reasonably available, if the premium costs for such insurance are disproportionate to the amount of coverage provided, if the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit, or if Indemnitee is covered by similar insurance maintained by a subsidiary or parent of the Company. 8. SEVERABILITY. Nothing in this Agreement is intended to require or shall be construed as requiring the Company to do or fail to do any act in violation of applicable law. The Company's inability, pursuant to court order, to perform its obligations under this Agreement shall not constitute a breach of this Agreement. The provisions of this Agreement shall be severable as provided in this Section 8. If this Agreement or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify Indemnitee to the full extent permitted by any applicable portion of this Agreement that shall not have been invalidated, and the balance of this Agreement not so invalidated shall be enforceable in accordance with its terms. 9. EXCEPTIONS. Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement: (a) CLAIMS INITIATED BY INDEMNITEE. To indemnify or advance expenses to Indemnitee with respect to proceedings or claims initiated or brought voluntarily by Indemnitee and not by way of defense, except with respect to proceedings brought to establish or enforce a right to indemnification under this Agreement or any other statute or otherwise as required under Section 145 of the Delaware General Corporation Law, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board of Directors has approved the initiation or bringing of such suit; (b) LACK OF GOOD FAITH. To indemnify Indemnitee for any expenses incurred by the Indemnitee with respect to any proceeding instituted by Indemnitee to enforce or interpret this Agreement, if a court of competent jurisdiction determines that each of the material assertions made by the Indemnitee in such proceeding was not made in good faith or was frivolous; (c) INSURED CLAIMS. To indemnity Indemnitee for expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise tax or penalties, and amounts paid in settlement) which have been paid directly to Indemnitee by an insurance carrier under a policy of officers' and directors' liability insurance or other policy of insurance maintained by the Company; (d) CLAIMS UNDER SECTION 16(b). To indemnify Indemnitee for expenses and the payment of profits arising from the purchase and sale by Indemnitee or securities in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute; (e) UNLAWFUL CLAIMS. To indemnify Indemnitee in any manner which is contrary to public policy or which a court of competent jurisdiction has finally determined to be unlawful; 6 7 (f) FAILURE TO SETTLE PROCEEDING. To indemnify Indemnitee for liabilities in excess of the total amount at which settlement reasonably could have been made, or for any cost and/or expenses incurred by Indemnitee following the time such settlement reasonably could have been effected, if Indemnitee shall have unreasonably delayed, refused or failed to enter into a settlement or any action, suit or proceeding (or investigation or appeal thereof) recommended in good faith, in writing, by the Company; or (g) BREACH OF EMPLOYMENT AGREEMENT. To indemnify Indemnitee for any breach by Indemnitee of any employment agreement between Indemnitee and the Company or any of its subsidiaries. 10. CONSTRUCTION OF CERTAIN PHRASES. For purposes of this Agreement, references to the "Company" shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, employees and/or agents, so that if Indemnitee is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, Indemnitee shall stand in the same position under the provisions of this Agreement with respect to the resulting or surviving corporation as Indemnitee would have with respect to such constituent corporation if its separate existence had continued. For purposes of this Agreement, references to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on Indemnitee with respect to an employee benefit plan; and references to "serving at the request of the Company" shall include any service as a director, officer, employee or agent of the Company or any subsidiary of the Company which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants, or beneficiaries; and if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan, Indemnitee shall be deemed to have acted in a manner "not opposed to the best interest of the Company" as referred to in this Agreement. 11. COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which shall constitute an original. 12. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the Company and its successors and assigns, and shall inure to the benefit of Indemnitee and Indemnitee's estate, heirs, legal representatives and assigns. 13. ATTORNEY'S FEES. In the event that any action is instituted by Indemnitee under this Agreement to enforce or interpret any of the terms hereof, Indemnitee shall be entitled to be paid all court costs and expenses, including reasonable attorneys' fees, incurred by Indemnitee with respect to such action, unless as a part of such action, the court of competent jurisdiction determines that 7 8 each of the material assertions made by Indemnitee as a basis for such action were not made in good faith or were frivolous. In the event of an action instituted by or in the name of the Company under this Agreement to enforce or interpret any of the terms of this Agreement, Indemnitee shall be entitled to be paid all court costs and expenses, including attorneys' fees, incurred by Indemnitee in defense of such action (including with respect to Indemnitee's counterclaims and cross-claims made in such action), unless as a part of such action the court determines the each of Indemnitee's material defenses to such action were made in bad faith or were frivolous. 14. NOTICE. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) if delivered by hand and receipted for by the party addressee, on the date of such receipt, or (ii) if mailed by domestic certified or registered mail with postage prepaid, on the third business day after the date postmarked. Addresses for notice to either party are as shown on the signature page of this Agreement, or as subsequently modified by written notice. 15. CONSENT TO JURISDICTION. The Company and Indemnitee each hereby irrevocably consent to the jurisdiction of the courts of the State of New Jersey for all purposes in connection with any action or proceeding which arises out of or relates to this Agreement and agree that any action instituted under this Agreement shall be brought only in the state courts of the State of New Jersey, or in Federal courts located in such State. 16. CHOICE OF LAW. This Agreement shall be governed by and its provisions construed in accordance with the laws of the State of Delaware. 17. CALIFORNIA LAW. To the extent that the Company is subject to the provisions of Section 317 of the California General Corporation Law pursuant to Section 2115 of the California General Corporation Law, nothing in this Agreement shall be deemed to require the Company to take any action which would cause it to be in violation of Section 317 of the California General Corporation Law. 8 9 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. GARY PLAYER DIRECT, INC., a Delaware Corporation. By: /s/ Carl L. Casareto ------------------------------------------- Name: Carl L. Casareto Title: Executive Vice President Address: 710 Aerovista, Suite B San Luis Obispo, California 93401 AGREED TO AND ACCEPTED: INDEMNITEE: /s/ Marc B. Player - ------------------------ MARC B. PLAYER Address: Gary Player Group, Inc. 3930 RCA Boulevard, Suite 3001 Palm Beach Gardens, Florida 33410 9 EX-10.4 5 INDEMNIFICATION AGREEMENT W/PAMELA CAMPBELL 1 Exhibit 10.4 INDEMNIFICATION AGREEMENT This INDEMNIFICATION AGREEMENT ("Agreement") is made as of this 14th day of October, 1999, by and between GARY PLAYER DIRECT, INC., a Delaware corporation located at 710 Aerovista, Suite B, San Luis Obispo, California 93401 (the "Company"), and PAMELA CAMPBELL ("Indemnitee"). RECITALS A. The Company and Indemnitee recognize the increasing difficulty in obtaining suitable liability insurance for directors, officers, employees and agents, the significant increases in the cost of such insurance and the general reductions in the coverage of such insurance. B. The Company and Indemnitee further recognize the substantial increase in corporate litigation in general, subjecting directors, officers, employees, and agents to expensive litigation risk at the same time that the availability and coverage of liability insurance has been severely limited. C. Indemnitee does not regard the current protection available as adequate under the present circumstances, and Indemnitee and other directors, officers, employers and agents of the Company may not be willing to continue to serve as directors, officers, employees and agents without additional protection. D. The Company desires to attract and retain the services of highly qualified individuals, such as Indemnitee, to serve as directors, officers, employees and agents of the Company and to indemnify its directors, officers, employees and agents so as to provide them with the maximum protection permitted by law. E. The Company, through its Board of Directors, approved this Agreement on the 12th day of October, 1999. AGREEMENT The Company and Indemnitee hereby agree as follows: 1. AGREEMENT TO SERVE. Indemnitee agrees to serve and continue to serve the Company, at the Company's will (or under separate written agreement approved by the Board of Directors of the Company, if such agreement exists), in the capacity Indemnitee currently serves the Company, as long as Indemnitee is duly appointed or elected and qualified in accordance with the applicable provisions of the By-Laws of the Company or any subsidiary of the Company or (subject to any employment agreement between Indemnitee and the Company) until such time as Indemnitee tenders a written resignation or is removed in accordance with the By-Laws; provided, however, that nothing contained in this Agreement is intended to or shall create any right (express or implied) to continued employment by Indemnitee. 2 2. INDEMNIFICATION. (a) THIRD PARTY PROCEEDINGS. The Company shall indemnify Indemnitee if Indemnitee is or was a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Company) by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, by reason of any action or inaction on the part of Indemnitee while a director, officer, employee or agent, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations), judgments, fines and amounts paid in settlement (if such settlement is approved in advance by the Company) actually and reasonably incurred by Indemnitee in connection with such action, suit or proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe Indemnitee's conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had reasonable cause to believe that Indemnitee's conduct was unlawful. (b) PROCEEDINGS BY OR IN THE RIGHT OF THE COMPANY. The Company shall indemnify Indemnitee if Indemnitee was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Company or any subsidiary of the Company to procure a judgment in its favor by reason of the fact the Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, by reason of any action or inaction on the part of Indemnitee while a director, officer, employee or agent, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations) and, to the fullest extent permitted by law, amounts paid in settlement, in each case to the extent actually and reasonably incurred by Indemnitee in connection with the defense or settlement of such action or suit (i) if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company and its stockholders, except that no indemnification shall be made in respect of any claim, issue or matter as to which Indemnitee shall have been adjudged to be liable to the Company in the performance of Indemnitee's duty to the Company and its stockholders unless and only to the extent that the court in which such action or suit is or was pending shall determine upon application that, in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for expenses and then only to the extent that the court shall determine; (ii) if Indemnitee is a director, to the extent that the action or contemplated action seeks monetary damages for breach of Indemnitee's duties to the Company and its stockholders in circumstances under which Indemnitee's personal liability therefor has been 2 3 eliminated as a result of the provisions of Section 102(b)(7) of the Delaware General Corporation Law; or (iii) if Indemnitee is an agent other than a director, to the extent that, were Indemnitee a director, Indemnitee would have the right to be indemnified under Section 2(b)(ii), above; and in the case of Sections 2(b)(ii) and 2(b)(iii) above, indemnification shall include, to the extent not prohibited by law, indemnification against all judgments, fines and amounts paid in settlement actually and reasonably incurred by Indemnitee in connection with such action, suit or proceeding. (c) MANDATORY PAYMENT OF EXPENSES. To the extent that Indemnitee has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Sections 2(a) or (b) or in defense of any claim, issue or matter therein, Indemnitee shall be indemnified against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations) actually and reasonably incurred by Indemnitee in connection therewith. (d) INDEMNIFICATION FOR SERVING AS A WITNESS. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of Indemnitee's status as a director, officer, employee or agent of the Company, a witness in any action, suit or proceeding, whether civil, criminal, administrative or investigative, Indemnitee shall be indemnified against expenses actually and reasonably incurred by Indemnitee in connection therewith. 3. EXPENSES; INDEMNIFICATION PROCEDURE. (a) ADVANCEMENT OF EXPENSES. The Company shall advance all reasonable expenses incurred by Indemnitee in connection with the investigation, defense, settlement or appeal of any civil, criminal, administrative or investigative action, suit or proceeding referenced in Sections 2(a) or (b) hereof (but not amounts actually paid in settlement of any such action, suit or proceeding). Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it shall ultimately be determined that Indemnitee is not entitled to be indemnified by the Company as authorized hereby. (b) NOTICE/COOPERATION BY INDEMNITEE. Indemnitee shall, as a condition precedent to his right to indemnified under this Agreement, give the Company notice, in accordance with Section 14 hereof, of any claim made against Indemnitee for which indemnification will or could be sought under this Agreement. Notice to the Company shall be directed to the appropriate officer of the Company. In addition, Indemnitee shall give the Company such information and cooperation as it may reasonably require and as shall be within Indemnitee's power. (c) PROCEDURE. Any indemnification and advances provided for in Section 2 and this Section 3 shall be made no later than thirty (30) days after receipt of the written request of Indemnitee. If a claim under this Agreement, under any statute, or under any provision of the Company's Certificate of Incorporation or By-Laws providing for indemnification, is not paid in full by the Company within thirty (30) days after a written request for payment thereof has first been received by the Company, Indemnitee may, but need not, at any time thereafter bring an action against the Company to recover the unpaid amount of the claim and, subject to Section 13 of this Agreement, Indemnitee shall also be entitled to be paid for the expenses (including attorneys' fees) 3 4 of bringing such action. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in connection with any action, suit or proceeding in advance of its final disposition) that Indemnitee has not met the standards of conduct which make it permissible under applicable law for the Company to indemnify Indemnitee. Indemnitee shall be entitled to receive interim payments of expenses pursuant to Section 3(a) unless and until such defense may be finally adjudicated by court order or judgment from which no further right of appeal exists. It is the intention of the parties that if the Company contests Indemnitee's right to indemnification, the question of Indemnitee's right to indemnification shall be for the court to decide, and neither the failure of the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) to have made a determination that indemnification of Indemnitee is proper in the circumstances because Indemnitee has met the applicable standard of conduct required by applicable law, nor an actual determination by the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) that Indemnitee has not met such applicable standard of conduct, shall create a presumption that Indemnitee has or has not met the applicable standard of conduct. (d) NOTICE TO INSURERS. If, at the time of the receipt of a notice of a claim pursuant to Section 3(b) hereof, the Company has director and officer liability insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies. (e) SELECTION OF COUNSEL. In the event the Company shall be obligated under Section 3(a) hereof to pay the expenses of any proceedings against Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by Indemnitee, upon the delivery to Indemnitee of written notice of its election so to do. After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees of counsel subsequently incurred by Indemnitee with respect to the same proceeding, provided that (i) Indemnitee shall have the right to employ separate counsel in any such proceeding at Indemnitee's expense; and (ii) if (A) the employment of counsel by Indemnitee has been previously authorized by the Company, (B) Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and Indemnitee in the conduct of any such defense, or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then the fees and expenses of Indemnitee's counsel shall be at the expense of the Company. 4. ADDITIONAL INDEMNIFICATION RIGHTS; NON-EXCLUSIVITY. (a) SCOPE. Notwithstanding any other provision of this Agreement, the Company hereby agrees to indemnify the Indemnitee to the fullest extent permitted by law, notwithstanding that such indemnification is not specifically authorized by the other provisions of this Agreement, the Company's Certificate of Incorporation, the Company's By-Laws or by statute. In the event of any change in any applicable law, statute or rule which narrows the right of a Delaware corporation 4 5 to indemnify a member of its board of directors or its officers, employees or agents, such change, to the extent not otherwise required by such law, statute or rule to be applied to this Agreement, shall have no effect on this Agreement or the parties' rights and obligations hereunder. (b) NON-EXCLUSIVITY. The indemnification provided by this Agreement shall not be deemed exclusive of any rights to which Indemnitee may be entitled under the Company's Certificate of Incorporation, By-Laws, any agreement, any vote of stockholders or disinterested Directors, the Delaware General Corporation Law or otherwise, both as to action in Indemnitee's official capacity and as to action in another capacity while holding such office. The indemnification provided under this Agreement shall continue as to Indemnitee for any action taken or not taken while serving in an indemnified capacity even though he may have ceased to serve in such capacity at the time of any action, suit or other covered proceeding. 5. PARTIAL INDEMNIFICATION. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of the expenses, judgments, fines or penalties actually or reasonably incurred by him in the investigation, defense, appeal or settlement of any civil or criminal action, suit or proceeding, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion of such expenses, judgments, fines or penalties to which Indemnitee is entitled. 6. MUTUAL ACKNOWLEDGMENT. Both the Company and Indemnitee acknowledge that in certain instances, Federal law or applicable public policy may prohibit the Company from indemnifying its directors, officers, employees and/or agents under this Agreement or otherwise. Indemnitee understands and acknowledges that the Company has undertaken or may be required in the future to undertake with the Securities and Exchange Commission to submit the question of indemnification to a court in certain circumstances for a determination of the Company's right under public policy to indemnify Indemnitee. 7. LIABILITY INSURANCE. If the Company does not maintain a policy or policies of officers and directors liability insurance with a reputable insurance company or companies, upon written request of Indemnities, the Company shall, from time to time, make the good faith determination whether or not it is practicable for the Company to obtain and maintain such a policy or policies of insurance. Officers and directors liability insurance would cover, among other things, coverage for losses from wrongful acts and/or to ensure the Company's performance of its obligations under this Agreement. The Company shall not be obligated to make such determination more than once in any 12-month period based on written requests from Indemnities and any other persons with similar rights. Among other considerations, the Company will weigh the costs of obtaining such insurance coverage against the protection afforded by such coverage. In all such policies of liability insurance, Indemnitee shall be named as an insured in such a manner as to provide Indemnitee the same rights and benefits as are accorded to the most favorably insured of the Company's directors, if Indemnitee is a director; or of the Company's officers, if Indemnitee is not a director of the Company but is an officer; or of the Company's employees, if Indemnitee is not a director or officer but is an employee; or of the Company's agents, if Indemnitee is not a director, officer or employee but is an agent. Notwithstanding the foregoing, the Company shall have no obligation to obtain or maintain such insurance if the Company determines in good faith that such 5 6 insurance is not reasonably available, if the premium costs for such insurance are disproportionate to the amount of coverage provided, if the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit, or if Indemnitee is covered by similar insurance maintained by a subsidiary or parent of the Company. 8. SEVERABILITY. Nothing in this Agreement is intended to require or shall be construed as requiring the Company to do or fail to do any act in violation of applicable law. The Company's inability, pursuant to court order, to perform its obligations under this Agreement shall not constitute a breach of this Agreement. The provisions of this Agreement shall be severable as provided in this Section 8. If this Agreement or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify Indemnitee to the full extent permitted by any applicable portion of this Agreement that shall not have been invalidated, and the balance of this Agreement not so invalidated shall be enforceable in accordance with its terms. 9. EXCEPTIONS. Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement: (a) CLAIMS INITIATED BY INDEMNITEE. To indemnify or advance expenses to Indemnitee with respect to proceedings or claims initiated or brought voluntarily by Indemnitee and not by way of defense, except with respect to proceedings brought to establish or enforce a right to indemnification under this Agreement or any other statute or otherwise as required under Section 145 of the Delaware General Corporation Law, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board of Directors has approved the initiation or bringing of such suit; (b) LACK OF GOOD FAITH. To indemnify Indemnitee for any expenses incurred by the Indemnitee with respect to any proceeding instituted by Indemnitee to enforce or interpret this Agreement, if a court of competent jurisdiction determines that each of the material assertions made by the Indemnitee in such proceeding was not made in good faith or was frivolous; (c) INSURED CLAIMS. To indemnity Indemnitee for expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise tax or penalties, and amounts paid in settlement) which have been paid directly to Indemnitee by an insurance carrier under a policy of officers' and directors' liability insurance or other policy of insurance maintained by the Company; (d) CLAIMS UNDER SECTION 16(b). To indemnify Indemnitee for expenses and the payment of profits arising from the purchase and sale by Indemnitee or securities in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute; (e) UNLAWFUL CLAIMS. To indemnify Indemnitee in any manner which is contrary to public policy or which a court of competent jurisdiction has finally determined to be unlawful; 6 7 (f) FAILURE TO SETTLE PROCEEDING. To indemnify Indemnitee for liabilities in excess of the total amount at which settlement reasonably could have been made, or for any cost and/or expenses incurred by Indemnitee following the time such settlement reasonably could have been effected, if Indemnitee shall have unreasonably delayed, refused or failed to enter into a settlement or any action, suit or proceeding (or investigation or appeal thereof) recommended in good faith, in writing, by the Company; or (g) BREACH OF EMPLOYMENT AGREEMENT. To indemnify Indemnitee for any breach by Indemnitee of any employment agreement between Indemnitee and the Company or any of its subsidiaries. 10. CONSTRUCTION OF CERTAIN PHRASES. For purposes of this Agreement, references to the "Company" shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, employees and/or agents, so that if Indemnitee is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, Indemnitee shall stand in the same position under the provisions of this Agreement with respect to the resulting or surviving corporation as Indemnitee would have with respect to such constituent corporation if its separate existence had continued. For purposes of this Agreement, references to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on Indemnitee with respect to an employee benefit plan; and references to "serving at the request of the Company" shall include any service as a director, officer, employee or agent of the Company or any subsidiary of the Company which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants, or beneficiaries; and if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan, Indemnitee shall be deemed to have acted in a manner "not opposed to the best interest of the Company" as referred to in this Agreement. 11. COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which shall constitute an original. 12. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the Company and its successors and assigns, and shall inure to the benefit of Indemnitee and Indemnitee's estate, heirs, legal representatives and assigns. 13. ATTORNEY'S FEES. In the event that any action is instituted by Indemnitee under this Agreement to enforce or interpret any of the terms hereof, Indemnitee shall be entitled to be paid all court costs and expenses, including reasonable attorneys' fees, incurred by Indemnitee with respect to such action, unless as a part of such action, the court of competent jurisdiction determines that 7 8 each of the material assertions made by Indemnitee as a basis for such action were not made in good faith or were frivolous. In the event of an action instituted by or in the name of the Company under this Agreement to enforce or interpret any of the terms of this Agreement, Indemnitee shall be entitled to be paid all court costs and expenses, including attorneys' fees, incurred by Indemnitee in defense of such action (including with respect to Indemnitee's counterclaims and cross-claims made in such action), unless as a part of such action the court determines the each of Indemnitee's material defenses to such action were made in bad faith or were frivolous. 14. NOTICE. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) if delivered by hand and receipted for by the party addressee, on the date of such receipt, or (ii) if mailed by domestic certified or registered mail with postage prepaid, on the third business day after the date postmarked. Addresses for notice to either party are as shown on the signature page of this Agreement, or as subsequently modified by written notice. 15. CONSENT TO JURISDICTION. The Company and Indemnitee each hereby irrevocably consent to the jurisdiction of the courts of the State of New Jersey for all purposes in connection with any action or proceeding which arises out of or relates to this Agreement and agree that any action instituted under this Agreement shall be brought only in the state courts of the State of New Jersey, or in Federal courts located in such State. 16. CHOICE OF LAW. This Agreement shall be governed by and its provisions construed in accordance with the laws of the State of Delaware. 17. CALIFORNIA LAW. To the extent that the Company is subject to the provisions of Section 317 of the California General Corporation Law pursuant to Section 2115 of the California General Corporation Law, nothing in this Agreement shall be deemed to require the Company to take any action which would cause it to be in violation of Section 317 of the California General Corporation Law. 8 9 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. GARY PLAYER DIRECT, INC., a Delaware Corporation. By: /s/ Carl L. Casareto ------------------------------------------- Name: Carl L. Casareto Title: Executive Vice President Address: 710 Aerovista, Suite B San Luis Obispo, California 93401 AGREED TO AND ACCEPTED: INDEMNITEE: /s/ Pamela Campbell - ----------------------- PAMELA CAMPBELL Address: Gary Player Group, Inc. 3930 RCA Boulevard, Suite 3001 Palm Beach Gardens, Florida 33410 9 EX-10.5 6 INDEMNIFICATION AGREEMENT W/CARL L. CASARETO 1 Exhibit 10.5 INDEMNIFICATION AGREEMENT This INDEMNIFICATION AGREEMENT ("Agreement") is made as of this 14th day of October, 1999, by and between GARY PLAYER DIRECT, INC., a Delaware corporation located at 710 Aerovista, Suite B, San Luis Obispo, California 93401 (the "Company"), and CARL L. CASARETO ("Indemnitee"). RECITALS A. The Company and Indemnitee recognize the increasing difficulty in obtaining suitable liability insurance for directors, officers, employees and agents, the significant increases in the cost of such insurance and the general reductions in the coverage of such insurance. B. The Company and Indemnitee further recognize the substantial increase in corporate litigation in general, subjecting directors, officers, employees, and agents to expensive litigation risk at the same time that the availability and coverage of liability insurance has been severely limited. C. Indemnitee does not regard the current protection available as adequate under the present circumstances, and Indemnitee and other directors, officers, employers and agents of the Company may not be willing to continue to serve as directors, officers, employees and agents without additional protection. D. The Company desires to attract and retain the services of highly qualified individuals, such as Indemnitee, to serve as directors, officers, employees and agents of the Company and to indemnify its directors, officers, employees and agents so as to provide them with the maximum protection permitted by law. E. The Company, through its Board of Directors, approved this Agreement on the 12th day of October, 1999. AGREEMENT The Company and Indemnitee hereby agree as follows: 1. AGREEMENT TO SERVE. Indemnitee agrees to serve and continue to serve the Company, at the Company's will (or under separate written agreement approved by the Board of Directors of the Company, if such agreement exists), in the capacity Indemnitee currently serves the Company, as long as Indemnitee is duly appointed or elected and qualified in accordance with the applicable provisions of the By-Laws of the Company or any subsidiary of the Company or (subject to any employment agreement between Indemnitee and the Company) until such time as Indemnitee tenders a written resignation or is removed in accordance with the By-Laws; provided, however, that nothing contained in this Agreement is intended to or shall create any right (express or implied) to continued employment by Indemnitee. 2 2. INDEMNIFICATION. (a) THIRD PARTY PROCEEDINGS. The Company shall indemnify Indemnitee if Indemnitee is or was a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Company) by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, by reason of any action or inaction on the part of Indemnitee while a director, officer, employee or agent, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations), judgments, fines and amounts paid in settlement (if such settlement is approved in advance by the Company) actually and reasonably incurred by Indemnitee in connection with such action, suit or proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe Indemnitee's conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had reasonable cause to believe that Indemnitee's conduct was unlawful. (b) PROCEEDINGS BY OR IN THE RIGHT OF THE COMPANY. The Company shall indemnify Indemnitee if Indemnitee was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Company or any subsidiary of the Company to procure a judgment in its favor by reason of the fact the Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, by reason of any action or inaction on the part of Indemnitee while a director, officer, employee or agent, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations) and, to the fullest extent permitted by law, amounts paid in settlement, in each case to the extent actually and reasonably incurred by Indemnitee in connection with the defense or settlement of such action or suit (i) if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company and its stockholders, except that no indemnification shall be made in respect of any claim, issue or matter as to which Indemnitee shall have been adjudged to be liable to the Company in the performance of Indemnitee's duty to the Company and its stockholders unless and only to the extent that the court in which such action or suit is or was pending shall determine upon application that, in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for expenses and then only to the extent that the court shall determine; (ii) if Indemnitee is a director, to the extent that the action or contemplated action seeks monetary damages for breach of Indemnitee's duties to the Company and its stockholders in circumstances under which Indemnitee's personal liability therefor has been 2 3 eliminated as a result of the provisions of Section 102(b)(7) of the Delaware General Corporation Law; or (iii) if Indemnitee is an agent other than a director, to the extent that, were Indemnitee a director, Indemnitee would have the right to be indemnified under Section 2(b)(ii), above; and in the case of Sections 2(b)(ii) and 2(b)(iii) above, indemnification shall include, to the extent not prohibited by law, indemnification against all judgments, fines and amounts paid in settlement actually and reasonably incurred by Indemnitee in connection with such action, suit or proceeding. (c) MANDATORY PAYMENT OF EXPENSES. To the extent that Indemnitee has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Sections 2(a) or (b) or in defense of any claim, issue or matter therein, Indemnitee shall be indemnified against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations) actually and reasonably incurred by Indemnitee in connection therewith. (d) INDEMNIFICATION FOR SERVING AS A WITNESS. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of Indemnitee's status as a director, officer, employee or agent of the Company, a witness in any action, suit or proceeding, whether civil, criminal, administrative or investigative, Indemnitee shall be indemnified against expenses actually and reasonably incurred by Indemnitee in connection therewith. 3. EXPENSES; INDEMNIFICATION PROCEDURE. (a) ADVANCEMENT OF EXPENSES. The Company shall advance all reasonable expenses incurred by Indemnitee in connection with the investigation, defense, settlement or appeal of any civil, criminal, administrative or investigative action, suit or proceeding referenced in Sections 2(a) or (b) hereof (but not amounts actually paid in settlement of any such action, suit or proceeding). Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it shall ultimately be determined that Indemnitee is not entitled to be indemnified by the Company as authorized hereby. (b) NOTICE/COOPERATION BY INDEMNITEE. Indemnitee shall, as a condition precedent to his right to indemnified under this Agreement, give the Company notice, in accordance with Section 14 hereof, of any claim made against Indemnitee for which indemnification will or could be sought under this Agreement. Notice to the Company shall be directed to the appropriate officer of the Company. In addition, Indemnitee shall give the Company such information and cooperation as it may reasonably require and as shall be within Indemnitee's power. (c) PROCEDURE. Any indemnification and advances provided for in Section 2 and this Section 3 shall be made no later than thirty (30) days after receipt of the written request of Indemnitee. If a claim under this Agreement, under any statute, or under any provision of the Company's Certificate of Incorporation or By-Laws providing for indemnification, is not paid in full by the Company within thirty (30) days after a written request for payment thereof has first been received by the Company, Indemnitee may, but need not, at any time thereafter bring an action against the Company to recover the unpaid amount of the claim and, subject to Section 13 of this Agreement, Indemnitee shall also be entitled to be paid for the expenses (including attorneys' fees) 3 4 of bringing such action. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in connection with any action, suit or proceeding in advance of its final disposition) that Indemnitee has not met the standards of conduct which make it permissible under applicable law for the Company to indemnify Indemnitee. Indemnitee shall be entitled to receive interim payments of expenses pursuant to Section 3(a) unless and until such defense may be finally adjudicated by court order or judgment from which no further right of appeal exists. It is the intention of the parties that if the Company contests Indemnitee's right to indemnification, the question of Indemnitee's right to indemnification shall be for the court to decide, and neither the failure of the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) to have made a determination that indemnification of Indemnitee is proper in the circumstances because Indemnitee has met the applicable standard of conduct required by applicable law, nor an actual determination by the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) that Indemnitee has not met such applicable standard of conduct, shall create a presumption that Indemnitee has or has not met the applicable standard of conduct. (d) NOTICE TO INSURERS. If, at the time of the receipt of a notice of a claim pursuant to Section 3(b) hereof, the Company has director and officer liability insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies. (e) SELECTION OF COUNSEL. In the event the Company shall be obligated under Section 3(a) hereof to pay the expenses of any proceedings against Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by Indemnitee, upon the delivery to Indemnitee of written notice of its election so to do. After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees of counsel subsequently incurred by Indemnitee with respect to the same proceeding, provided that (i) Indemnitee shall have the right to employ separate counsel in any such proceeding at Indemnitee's expense; and (ii) if (A) the employment of counsel by Indemnitee has been previously authorized by the Company, (B) Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and Indemnitee in the conduct of any such defense, or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then the fees and expenses of Indemnitee's counsel shall be at the expense of the Company. 4. ADDITIONAL INDEMNIFICATION RIGHTS; NON-EXCLUSIVITY. (a) SCOPE. Notwithstanding any other provision of this Agreement, the Company hereby agrees to indemnify the Indemnitee to the fullest extent permitted by law, notwithstanding that such indemnification is not specifically authorized by the other provisions of this Agreement, the Company's Certificate of Incorporation, the Company's By-Laws or by statute. In the event of any change in any applicable law, statute or rule which narrows the right of a Delaware corporation 4 5 to indemnify a member of its board of directors or its officers, employees or agents, such change, to the extent not otherwise required by such law, statute or rule to be applied to this Agreement, shall have no effect on this Agreement or the parties' rights and obligations hereunder. (b) NON-EXCLUSIVITY. The indemnification provided by this Agreement shall not be deemed exclusive of any rights to which Indemnitee may be entitled under the Company's Certificate of Incorporation, By-Laws, any agreement, any vote of stockholders or disinterested Directors, the Delaware General Corporation Law or otherwise, both as to action in Indemnitee's official capacity and as to action in another capacity while holding such office. The indemnification provided under this Agreement shall continue as to Indemnitee for any action taken or not taken while serving in an indemnified capacity even though he may have ceased to serve in such capacity at the time of any action, suit or other covered proceeding. 5. PARTIAL INDEMNIFICATION. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of the expenses, judgments, fines or penalties actually or reasonably incurred by him in the investigation, defense, appeal or settlement of any civil or criminal action, suit or proceeding, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion of such expenses, judgments, fines or penalties to which Indemnitee is entitled. 6. MUTUAL ACKNOWLEDGMENT. Both the Company and Indemnitee acknowledge that in certain instances, Federal law or applicable public policy may prohibit the Company from indemnifying its directors, officers, employees and/or agents under this Agreement or otherwise. Indemnitee understands and acknowledges that the Company has undertaken or may be required in the future to undertake with the Securities and Exchange Commission to submit the question of indemnification to a court in certain circumstances for a determination of the Company's right under public policy to indemnify Indemnitee. 7. LIABILITY INSURANCE. If the Company does not maintain a policy or policies of officers and directors liability insurance with a reputable insurance company or companies, upon written request of Indemnities, the Company shall, from time to time, make the good faith determination whether or not it is practicable for the Company to obtain and maintain such a policy or policies of insurance. Officers and directors liability insurance would cover, among other things, coverage for losses from wrongful acts and/or to ensure the Company's performance of its obligations under this Agreement. The Company shall not be obligated to make such determination more than once in any 12-month period based on written requests from Indemnities and any other persons with similar rights. Among other considerations, the Company will weigh the costs of obtaining such insurance coverage against the protection afforded by such coverage. In all such policies of liability insurance, Indemnitee shall be named as an insured in such a manner as to provide Indemnitee the same rights and benefits as are accorded to the most favorably insured of the Company's directors, if Indemnitee is a director; or of the Company's officers, if Indemnitee is not a director of the Company but is an officer; or of the Company's employees, if Indemnitee is not a director or officer but is an employee; or of the Company's agents, if Indemnitee is not a director, officer or employee but is an agent. Notwithstanding the foregoing, the Company shall have no obligation to obtain or maintain such insurance if the Company determines in good faith that such 5 6 insurance is not reasonably available, if the premium costs for such insurance are disproportionate to the amount of coverage provided, if the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit, or if Indemnitee is covered by similar insurance maintained by a subsidiary or parent of the Company. 8. SEVERABILITY. Nothing in this Agreement is intended to require or shall be construed as requiring the Company to do or fail to do any act in violation of applicable law. The Company's inability, pursuant to court order, to perform its obligations under this Agreement shall not constitute a breach of this Agreement. The provisions of this Agreement shall be severable as provided in this Section 8. If this Agreement or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify Indemnitee to the full extent permitted by any applicable portion of this Agreement that shall not have been invalidated, and the balance of this Agreement not so invalidated shall be enforceable in accordance with its terms. 9. EXCEPTIONS. Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement: (a) CLAIMS INITIATED BY INDEMNITEE. To indemnify or advance expenses to Indemnitee with respect to proceedings or claims initiated or brought voluntarily by Indemnitee and not by way of defense, except with respect to proceedings brought to establish or enforce a right to indemnification under this Agreement or any other statute or otherwise as required under Section 145 of the Delaware General Corporation Law, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board of Directors has approved the initiation or bringing of such suit; (b) LACK OF GOOD FAITH. To indemnify Indemnitee for any expenses incurred by the Indemnitee with respect to any proceeding instituted by Indemnitee to enforce or interpret this Agreement, if a court of competent jurisdiction determines that each of the material assertions made by the Indemnitee in such proceeding was not made in good faith or was frivolous; (c) INSURED CLAIMS. To indemnity Indemnitee for expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise tax or penalties, and amounts paid in settlement) which have been paid directly to Indemnitee by an insurance carrier under a policy of officers' and directors' liability insurance or other policy of insurance maintained by the Company; (d) CLAIMS UNDER SECTION 16(b). To indemnify Indemnitee for expenses and the payment of profits arising from the purchase and sale by Indemnitee or securities in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute; (e) UNLAWFUL CLAIMS. To indemnify Indemnitee in any manner which is contrary to public policy or which a court of competent jurisdiction has finally determined to be unlawful; 6 7 (f) FAILURE TO SETTLE PROCEEDING. To indemnify Indemnitee for liabilities in excess of the total amount at which settlement reasonably could have been made, or for any cost and/or expenses incurred by Indemnitee following the time such settlement reasonably could have been effected, if Indemnitee shall have unreasonably delayed, refused or failed to enter into a settlement or any action, suit or proceeding (or investigation or appeal thereof) recommended in good faith, in writing, by the Company; or (g) BREACH OF EMPLOYMENT AGREEMENT. To indemnify Indemnitee for any breach by Indemnitee of any employment agreement between Indemnitee and the Company or any of its subsidiaries. 10. CONSTRUCTION OF CERTAIN PHRASES. For purposes of this Agreement, references to the "Company" shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, employees and/or agents, so that if Indemnitee is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, Indemnitee shall stand in the same position under the provisions of this Agreement with respect to the resulting or surviving corporation as Indemnitee would have with respect to such constituent corporation if its separate existence had continued. For purposes of this Agreement, references to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on Indemnitee with respect to an employee benefit plan; and references to "serving at the request of the Company" shall include any service as a director, officer, employee or agent of the Company or any subsidiary of the Company which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants, or beneficiaries; and if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan, Indemnitee shall be deemed to have acted in a manner "not opposed to the best interest of the Company" as referred to in this Agreement. 11. COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which shall constitute an original. 12. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the Company and its successors and assigns, and shall inure to the benefit of Indemnitee and Indemnitee's estate, heirs, legal representatives and assigns. 13. ATTORNEY'S FEES. In the event that any action is instituted by Indemnitee under this Agreement to enforce or interpret any of the terms hereof, Indemnitee shall be entitled to be paid all court costs and expenses, including reasonable attorneys' fees, incurred by Indemnitee with respect to such action, unless as a part of such action, the court of competent jurisdiction determines that 7 8 each of the material assertions made by Indemnitee as a basis for such action were not made in good faith or were frivolous. In the event of an action instituted by or in the name of the Company under this Agreement to enforce or interpret any of the terms of this Agreement, Indemnitee shall be entitled to be paid all court costs and expenses, including attorneys' fees, incurred by Indemnitee in defense of such action (including with respect to Indemnitee's counterclaims and cross-claims made in such action), unless as a part of such action the court determines the each of Indemnitee's material defenses to such action were made in bad faith or were frivolous. 14. NOTICE. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) if delivered by hand and receipted for by the party addressee, on the date of such receipt, or (ii) if mailed by domestic certified or registered mail with postage prepaid, on the third business day after the date postmarked. Addresses for notice to either party are as shown on the signature page of this Agreement, or as subsequently modified by written notice. 15. CONSENT TO JURISDICTION. The Company and Indemnitee each hereby irrevocably consent to the jurisdiction of the courts of the State of New Jersey for all purposes in connection with any action or proceeding which arises out of or relates to this Agreement and agree that any action instituted under this Agreement shall be brought only in the state courts of the State of New Jersey, or in Federal courts located in such State. 16. CHOICE OF LAW. This Agreement shall be governed by and its provisions construed in accordance with the laws of the State of Delaware. 17. CALIFORNIA LAW. To the extent that the Company is subject to the provisions of Section 317 of the California General Corporation Law pursuant to Section 2115 of the California General Corporation Law, nothing in this Agreement shall be deemed to require the Company to take any action which would cause it to be in violation of Section 317 of the California General Corporation Law. 8 9 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. GARY PLAYER DIRECT, INC., a Delaware Corporation. By: /s/ Thomas P. Gallagher ------------------------------------------- Name: Thomas P. Gallagher Title: President and CEO Address: 710 Aerovista, Suite B San Luis Obispo, California 93401 AGREED TO AND ACCEPTED: INDEMNITEE: /s/ Carl L. Casareto - ----------------------- CARL L. CASARETO Address: Gary Player Direct 710 Aerovista, Suite B San Luis Obispo, California 93401 9 EX-10.6 7 INDEMNIFICATION AGREEMENT W/BARBARA NUNEZ 1 Exhibit 10.6 INDEMNIFICATION AGREEMENT This INDEMNIFICATION AGREEMENT ("Agreement") is made as of this 14th day of October, 1999, by and between GARY PLAYER DIRECT, INC., a Delaware corporation located at 710 Aerovista, Suite B, San Luis Obispo, California 93401 (the "Company"), and BARBARA NUNEZ ("Indemnitee"). RECITALS A. The Company and Indemnitee recognize the increasing difficulty in obtaining suitable liability insurance for directors, officers, employees and agents, the significant increases in the cost of such insurance and the general reductions in the coverage of such insurance. B. The Company and Indemnitee further recognize the substantial increase in corporate litigation in general, subjecting directors, officers, employees, and agents to expensive litigation risk at the same time that the availability and coverage of liability insurance has been severely limited. C. Indemnitee does not regard the current protection available as adequate under the present circumstances, and Indemnitee and other directors, officers, employers and agents of the Company may not be willing to continue to serve as directors, officers, employees and agents without additional protection. D. The Company desires to attract and retain the services of highly qualified individuals, such as Indemnitee, to serve as directors, officers, employees and agents of the Company and to indemnify its directors, officers, employees and agents so as to provide them with the maximum protection permitted by law. E. The Company, through its Board of Directors, approved this Agreement on the 12th day of October, 1999. AGREEMENT The Company and Indemnitee hereby agree as follows: 1. AGREEMENT TO SERVE. Indemnitee agrees to serve and continue to serve the Company, at the Company's will (or under separate written agreement approved by the Board of Directors of the Company, if such agreement exists), in the capacity Indemnitee currently serves the Company, as long as Indemnitee is duly appointed or elected and qualified in accordance with the applicable provisions of the By-Laws of the Company or any subsidiary of the Company or (subject to any employment agreement between Indemnitee and the Company) until such time as Indemnitee tenders a written resignation or is removed in accordance with the By-Laws; provided, however, that nothing contained in this Agreement is intended to or shall create any right (express or implied) to continued employment by Indemnitee. 2 2. INDEMNIFICATION. (a) THIRD PARTY PROCEEDINGS. The Company shall indemnify Indemnitee if Indemnitee is or was a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Company) by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, by reason of any action or inaction on the part of Indemnitee while a director, officer, employee or agent, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations), judgments, fines and amounts paid in settlement (if such settlement is approved in advance by the Company) actually and reasonably incurred by Indemnitee in connection with such action, suit or proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe Indemnitee's conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had reasonable cause to believe that Indemnitee's conduct was unlawful. (b) PROCEEDINGS BY OR IN THE RIGHT OF THE COMPANY. The Company shall indemnify Indemnitee if Indemnitee was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Company or any subsidiary of the Company to procure a judgment in its favor by reason of the fact the Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, by reason of any action or inaction on the part of Indemnitee while a director, officer, employee or agent, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations) and, to the fullest extent permitted by law, amounts paid in settlement, in each case to the extent actually and reasonably incurred by Indemnitee in connection with the defense or settlement of such action or suit (i) if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company and its stockholders, except that no indemnification shall be made in respect of any claim, issue or matter as to which Indemnitee shall have been adjudged to be liable to the Company in the performance of Indemnitee's duty to the Company and its stockholders unless and only to the extent that the court in which such action or suit is or was pending shall determine upon application that, in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for expenses and then only to the extent that the court shall determine; (ii) if Indemnitee is a director, to the extent that the action or contemplated action seeks monetary damages for breach of Indemnitee's duties to the Company and its stockholders in circumstances under which Indemnitee's personal liability therefor has been 2 3 eliminated as a result of the provisions of Section 102(b)(7) of the Delaware General Corporation Law; or (iii) if Indemnitee is an agent other than a director, to the extent that, were Indemnitee a director, Indemnitee would have the right to be indemnified under Section 2(b)(ii), above; and in the case of Sections 2(b)(ii) and 2(b)(iii) above, indemnification shall include, to the extent not prohibited by law, indemnification against all judgments, fines and amounts paid in settlement actually and reasonably incurred by Indemnitee in connection with such action, suit or proceeding. (c) MANDATORY PAYMENT OF EXPENSES. To the extent that Indemnitee has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Sections 2(a) or (b) or in defense of any claim, issue or matter therein, Indemnitee shall be indemnified against expenses (including, without limitation, attorneys' fees, disbursements and retainers, accounting and witness fees, travel and deposition costs, and expenses of investigations) actually and reasonably incurred by Indemnitee in connection therewith. (d) INDEMNIFICATION FOR SERVING AS A WITNESS. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of Indemnitee's status as a director, officer, employee or agent of the Company, a witness in any action, suit or proceeding, whether civil, criminal, administrative or investigative, Indemnitee shall be indemnified against expenses actually and reasonably incurred by Indemnitee in connection therewith. 3. EXPENSES; INDEMNIFICATION PROCEDURE. (a) ADVANCEMENT OF EXPENSES. The Company shall advance all reasonable expenses incurred by Indemnitee in connection with the investigation, defense, settlement or appeal of any civil, criminal, administrative or investigative action, suit or proceeding referenced in Sections 2(a) or (b) hereof (but not amounts actually paid in settlement of any such action, suit or proceeding). Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it shall ultimately be determined that Indemnitee is not entitled to be indemnified by the Company as authorized hereby. (b) NOTICE/COOPERATION BY INDEMNITEE. Indemnitee shall, as a condition precedent to his right to indemnified under this Agreement, give the Company notice, in accordance with Section 14 hereof, of any claim made against Indemnitee for which indemnification will or could be sought under this Agreement. Notice to the Company shall be directed to the appropriate officer of the Company. In addition, Indemnitee shall give the Company such information and cooperation as it may reasonably require and as shall be within Indemnitee's power. (c) PROCEDURE. Any indemnification and advances provided for in Section 2 and this Section 3 shall be made no later than thirty (30) days after receipt of the written request of Indemnitee. If a claim under this Agreement, under any statute, or under any provision of the Company's Certificate of Incorporation or By-Laws providing for indemnification, is not paid in full by the Company within thirty (30) days after a written request for payment thereof has first been received by the Company, Indemnitee may, but need not, at any time thereafter bring an action against the Company to recover the unpaid amount of the claim and, subject to Section 13 of this Agreement, Indemnitee shall also be entitled to be paid for the expenses (including attorneys' fees) 3 4 of bringing such action. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in connection with any action, suit or proceeding in advance of its final disposition) that Indemnitee has not met the standards of conduct which make it permissible under applicable law for the Company to indemnify Indemnitee. Indemnitee shall be entitled to receive interim payments of expenses pursuant to Section 3(a) unless and until such defense may be finally adjudicated by court order or judgment from which no further right of appeal exists. It is the intention of the parties that if the Company contests Indemnitee's right to indemnification, the question of Indemnitee's right to indemnification shall be for the court to decide, and neither the failure of the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) to have made a determination that indemnification of Indemnitee is proper in the circumstances because Indemnitee has met the applicable standard of conduct required by applicable law, nor an actual determination by the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its stockholders) that Indemnitee has not met such applicable standard of conduct, shall create a presumption that Indemnitee has or has not met the applicable standard of conduct. (d) NOTICE TO INSURERS. If, at the time of the receipt of a notice of a claim pursuant to Section 3(b) hereof, the Company has director and officer liability insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies. (e) SELECTION OF COUNSEL. In the event the Company shall be obligated under Section 3(a) hereof to pay the expenses of any proceedings against Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by Indemnitee, upon the delivery to Indemnitee of written notice of its election so to do. After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees of counsel subsequently incurred by Indemnitee with respect to the same proceeding, provided that (i) Indemnitee shall have the right to employ separate counsel in any such proceeding at Indemnitee's expense; and (ii) if (A) the employment of counsel by Indemnitee has been previously authorized by the Company, (B) Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and Indemnitee in the conduct of any such defense, or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then the fees and expenses of Indemnitee's counsel shall be at the expense of the Company. 4. ADDITIONAL INDEMNIFICATION RIGHTS; NON-EXCLUSIVITY. (a) SCOPE. Notwithstanding any other provision of this Agreement, the Company hereby agrees to indemnify the Indemnitee to the fullest extent permitted by law, notwithstanding that such indemnification is not specifically authorized by the other provisions of this Agreement, the Company's Certificate of Incorporation, the Company's By-Laws or by statute. In the event of any change in any applicable law, statute or rule which narrows the right of a Delaware corporation 4 5 to indemnify a member of its board of directors or its officers, employees or agents, such change, to the extent not otherwise required by such law, statute or rule to be applied to this Agreement, shall have no effect on this Agreement or the parties' rights and obligations hereunder. (b) NON-EXCLUSIVITY. The indemnification provided by this Agreement shall not be deemed exclusive of any rights to which Indemnitee may be entitled under the Company's Certificate of Incorporation, By-Laws, any agreement, any vote of stockholders or disinterested Directors, the Delaware General Corporation Law or otherwise, both as to action in Indemnitee's official capacity and as to action in another capacity while holding such office. The indemnification provided under this Agreement shall continue as to Indemnitee for any action taken or not taken while serving in an indemnified capacity even though he may have ceased to serve in such capacity at the time of any action, suit or other covered proceeding. 5. PARTIAL INDEMNIFICATION. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of the expenses, judgments, fines or penalties actually or reasonably incurred by him in the investigation, defense, appeal or settlement of any civil or criminal action, suit or proceeding, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion of such expenses, judgments, fines or penalties to which Indemnitee is entitled. 6. MUTUAL ACKNOWLEDGMENT. Both the Company and Indemnitee acknowledge that in certain instances, Federal law or applicable public policy may prohibit the Company from indemnifying its directors, officers, employees and/or agents under this Agreement or otherwise. Indemnitee understands and acknowledges that the Company has undertaken or may be required in the future to undertake with the Securities and Exchange Commission to submit the question of indemnification to a court in certain circumstances for a determination of the Company's right under public policy to indemnify Indemnitee. 7. LIABILITY INSURANCE. If the Company does not maintain a policy or policies of officers and directors liability insurance with a reputable insurance company or companies, upon written request of Indemnities, the Company shall, from time to time, make the good faith determination whether or not it is practicable for the Company to obtain and maintain such a policy or policies of insurance. Officers and directors liability insurance would cover, among other things, coverage for losses from wrongful acts and/or to ensure the Company's performance of its obligations under this Agreement. The Company shall not be obligated to make such determination more than once in any 12-month period based on written requests from Indemnities and any other persons with similar rights. Among other considerations, the Company will weigh the costs of obtaining such insurance coverage against the protection afforded by such coverage. In all such policies of liability insurance, Indemnitee shall be named as an insured in such a manner as to provide Indemnitee the same rights and benefits as are accorded to the most favorably insured of the Company's directors, if Indemnitee is a director; or of the Company's officers, if Indemnitee is not a director of the Company but is an officer; or of the Company's employees, if Indemnitee is not a director or officer but is an employee; or of the Company's agents, if Indemnitee is not a director, officer or employee but is an agent. Notwithstanding the foregoing, the Company shall have no obligation to obtain or maintain such insurance if the Company determines in good faith that such 5 6 insurance is not reasonably available, if the premium costs for such insurance are disproportionate to the amount of coverage provided, if the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit, or if Indemnitee is covered by similar insurance maintained by a subsidiary or parent of the Company. 8. SEVERABILITY. Nothing in this Agreement is intended to require or shall be construed as requiring the Company to do or fail to do any act in violation of applicable law. The Company's inability, pursuant to court order, to perform its obligations under this Agreement shall not constitute a breach of this Agreement. The provisions of this Agreement shall be severable as provided in this Section 8. If this Agreement or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify Indemnitee to the full extent permitted by any applicable portion of this Agreement that shall not have been invalidated, and the balance of this Agreement not so invalidated shall be enforceable in accordance with its terms. 9. EXCEPTIONS. Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement: (a) CLAIMS INITIATED BY INDEMNITEE. To indemnify or advance expenses to Indemnitee with respect to proceedings or claims initiated or brought voluntarily by Indemnitee and not by way of defense, except with respect to proceedings brought to establish or enforce a right to indemnification under this Agreement or any other statute or otherwise as required under Section 145 of the Delaware General Corporation Law, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board of Directors has approved the initiation or bringing of such suit; (b) LACK OF GOOD FAITH. To indemnify Indemnitee for any expenses incurred by the Indemnitee with respect to any proceeding instituted by Indemnitee to enforce or interpret this Agreement, if a court of competent jurisdiction determines that each of the material assertions made by the Indemnitee in such proceeding was not made in good faith or was frivolous; (c) INSURED CLAIMS. To indemnity Indemnitee for expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise tax or penalties, and amounts paid in settlement) which have been paid directly to Indemnitee by an insurance carrier under a policy of officers' and directors' liability insurance or other policy of insurance maintained by the Company; (d) CLAIMS UNDER SECTION 16(b). To indemnify Indemnitee for expenses and the payment of profits arising from the purchase and sale by Indemnitee or securities in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute; (e) UNLAWFUL CLAIMS. To indemnify Indemnitee in any manner which is contrary to public policy or which a court of competent jurisdiction has finally determined to be unlawful; 6 7 (f) FAILURE TO SETTLE PROCEEDING. To indemnify Indemnitee for liabilities in excess of the total amount at which settlement reasonably could have been made, or for any cost and/or expenses incurred by Indemnitee following the time such settlement reasonably could have been effected, if Indemnitee shall have unreasonably delayed, refused or failed to enter into a settlement or any action, suit or proceeding (or investigation or appeal thereof) recommended in good faith, in writing, by the Company; or (g) BREACH OF EMPLOYMENT AGREEMENT. To indemnify Indemnitee for any breach by Indemnitee of any employment agreement between Indemnitee and the Company or any of its subsidiaries. 10. CONSTRUCTION OF CERTAIN PHRASES. For purposes of this Agreement, references to the "Company" shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, employees and/or agents, so that if Indemnitee is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, Indemnitee shall stand in the same position under the provisions of this Agreement with respect to the resulting or surviving corporation as Indemnitee would have with respect to such constituent corporation if its separate existence had continued. For purposes of this Agreement, references to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on Indemnitee with respect to an employee benefit plan; and references to "serving at the request of the Company" shall include any service as a director, officer, employee or agent of the Company or any subsidiary of the Company which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants, or beneficiaries; and if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan, Indemnitee shall be deemed to have acted in a manner "not opposed to the best interest of the Company" as referred to in this Agreement. 11. COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which shall constitute an original. 12. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the Company and its successors and assigns, and shall inure to the benefit of Indemnitee and Indemnitee's estate, heirs, legal representatives and assigns. 13. ATTORNEY'S FEES. In the event that any action is instituted by Indemnitee under this Agreement to enforce or interpret any of the terms hereof, Indemnitee shall be entitled to be paid all court costs and expenses, including reasonable attorneys' fees, incurred by Indemnitee with respect to such action, unless as a part of such action, the court of competent jurisdiction determines that 7 8 each of the material assertions made by Indemnitee as a basis for such action were not made in good faith or were frivolous. In the event of an action instituted by or in the name of the Company under this Agreement to enforce or interpret any of the terms of this Agreement, Indemnitee shall be entitled to be paid all court costs and expenses, including attorneys' fees, incurred by Indemnitee in defense of such action (including with respect to Indemnitee's counterclaims and cross-claims made in such action), unless as a part of such action the court determines the each of Indemnitee's material defenses to such action were made in bad faith or were frivolous. 14. NOTICE. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) if delivered by hand and receipted for by the party addressee, on the date of such receipt, or (ii) if mailed by domestic certified or registered mail with postage prepaid, on the third business day after the date postmarked. Addresses for notice to either party are as shown on the signature page of this Agreement, or as subsequently modified by written notice. 15. CONSENT TO JURISDICTION. The Company and Indemnitee each hereby irrevocably consent to the jurisdiction of the courts of the State of New Jersey for all purposes in connection with any action or proceeding which arises out of or relates to this Agreement and agree that any action instituted under this Agreement shall be brought only in the state courts of the State of New Jersey, or in Federal courts located in such State. 16. CHOICE OF LAW. This Agreement shall be governed by and its provisions construed in accordance with the laws of the State of Delaware. 17. CALIFORNIA LAW. To the extent that the Company is subject to the provisions of Section 317 of the California General Corporation Law pursuant to Section 2115 of the California General Corporation Law, nothing in this Agreement shall be deemed to require the Company to take any action which would cause it to be in violation of Section 317 of the California General Corporation Law. 8 9 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. GARY PLAYER DIRECT, INC., a Delaware Corporation. By: /s/ Thomas P. Gallagher ------------------------------------------- Name: Thomas P. Gallagher Title: President and CEO Address: 710 Aerovista, Suite B San Luis Obispo, California 93401 AGREED TO AND ACCEPTED: INDEMNITEE: /s/ Barbara Nunez - ---------------------- BARBARA NUNEZ Address: Gary Player Direct, Inc. 710 Aerovista, Suite B San Luis Obispo, California 93401 9 EX-99.1 8 PRESS RELEASE DATED OCTOBER 19, 1999 1 Exhibit 99.1 CONTACTS: AT THE COMPANY AT THE GARY PLAYER GROUP - -------------- ------------------------ Carl Casareto, Executive Vice President Marc B. Player, Chief Executive Officer Gary Player Direct, Inc. Palm Beach Gardens, FL 33410 San Luis Obispo, CA 93401 561-624-0301 (Ext. 102) 805-783-1011 FOR IMMEDIATE RELEASE - --------------------- OCTOBER 19, 1999 GARY PLAYER DIRECT IMPLEMENTS MANAGEMENT SUCCESSION PLAN; MARC PLAYER, GALLAGHER AND CAMPBELL APPOINTED TO BOARD San Luis Obispo, California (P.R. NEWSWIRE) - October 19, 1999 --- Gary Player Direct, Inc. (OTCBB: GPLYE), Tuesday announced that the Company had entered into a Succession Plan and Agreement effective on October 14, 1999 pursuant to which Marc B. Player and Pamela J. Campbell, both affiliated with The Gary Player Group of Palm Beach Gardens, Florida, have been appointed to the Board of Directors of Gary Player Direct, Inc. and will hold two of three positions on the Board of Directors. Thomas P. Gallagher, of Princeton, New Jersey, was named Chairman of the Board. In connection with these developments, Mr. A.J. Cervantes resigned from his positions as Chairman, President and Chief Executive Officer. Mr. Robert J. Friedland also resigned from his membership on the Board of Directors. The Company also announced that Carl L. Casareto has been appointed to the positions of Executive Vice President and Treasurer. Mr. Casareto has assumed day-to-day responsibilities for the Company. The Company stated that it believes that it will name a permanent Chief Executive Officer within the next sixty to ninety days. Commenting on today's developments, Gary Player stated that, "I am very enthusiastic about our new management team and I believe that they bring the talent, experience and reputation that can make Gary Player Direct one of the premium Internet-driven golf companies in the world." Also, in connection with today's announcements, the Company confirmed its intention to close on the acquisition of the assets of the Gary Player Golf Equipment division of The Gary Player Group ("GPG"). The Company believes that completing the acquisition will allow it to market and sell an expanded array of golf equipment and accessories worldwide. The assets of the golf equipment operations of GPG include principally two licenses which together would give the Company the perpetual, worldwide, exclusive right to use the name and likeness of Gary Player, the professional golfer, and ancillary marks, including Black Knight(tm) and the Gary Player logo, in connection with the manufacture, marketing and distribution of golf clubs, accessories and apparel for an annual license fee and a royalty based on net receipts. As part of this acquisition, the Company will also acquire existing sub-licenses based on the Player licenses, certain inventory and accounts receivable. 2 In commenting on his appointment today, Marc Player stated, "I am pleased to be part of the new team at Gary Player Direct. I believe this new team can provide the leadership necessary to overcome historic operating difficulties and build on the solid base of premium Gary Player products that the Company has developed. I intend to become very involved in the operations of the Company as we restructure the debt of the Company and integrate Gary Player Direct with the golf equipment division of The Gary Player Group. There are a number of projects that I intend to focus on including reviewing a number of potential acquisitions. We are committed to making Gary Player Direct a viable enterprise that brings exciting products to market and returns value to our shareholders. The next six months are critical for the Company and we sincerely need and appreciate the continued support of our suppliers, customers and shareholders. I am confident if we keep our focus on our customers we can capitalize on the reputation and achievements of Gary Player Worldwide." Cervantes noted that "The Player Group brings to the Company significant experience and resources which can support the completion of the Company's reorganization and e-commerce strategy and ultimately shareholder value." Marc Player has served as a Chief Executive Officer and a Director of The Gary Player Group, Inc., a company that manages a number of businesses including the Gary Player Golf Equipment Division, Gary Player Golf Academies, Gary Player Enterprises, a licensing and endorsement company of The Gary Player Group for non-golf related matters, and Gary Player Design, which has designed over 150 internationally acclaimed golf courses worldwide. Mr. Player has also served as President of Sports International, a company he formed in 1986. Sports International served as the exclusive representative in South Africa of International Management Group, one of the foremost sports management firms in the world. Sports International was acquired by International Management Group in 1991. Pamela J. Campbell is currently the Controller of The Gary Player Group, a position she has held since 1985. She has also assisted in all aspects of the administration of The Gary Player Group as well as Sports International. Thomas P. Gallagher, together with several individuals invested $1.0 million in the Company in May of 1998. Mr. Gallagher is a partner in the law firm of Gallagher, Briody & Butler in Princeton, New Jersey, recently appointed as the Company's corporate counsel, and concentrates in securities and general corporate law including mergers and acquisitions. Mr. Gallagher is a member of the Board of Directors of Angel Productions, Inc., a privately-held entertainment production enterprise that produces programming for cable, broadcast and internet television and theatrical productions. Mr. Gallagher advises numerous ventures in the sports management, casino gaming and telecommunications field and also advises a number of E-commerce start-ups. Mr. Casareto, in commenting on his appointments today as Executive Vice President and Treasurer stated that, "While I recognize that the Company has serious financial difficulties facing it, I am gratified by the support that Gary Player and Marc Player have shown to the Company especially Marc's decision to join the Board of Directors of the Company and take a more active role. Mr. Casareto further commented that, "During the next 30 to 60 days I intend to focus on several major concerns regarding the Company's operations, including satisfaction of in excess of $1.0 million in tax obligations and in excess of $1.0 million in customer refunds as well as settling 2 3 significant pending litigation matters that have arisen as a result of the Company's working capital deficit. We are going to work to cure existing defaults in our licenses with The Gary Player Group and conclude the acquisition of the assets of the golf equipment operations of The Gary Player Group as soon as financing is available and we can correct our operational difficulties. We also intend to work closely with our credit card processing company over the next several weeks in order to resolve outstanding obligations with them." The Company also reiterated its goal of resolving certain quality and customer issues that have arisen as a result of the Company's continuing working capital deficit. The Company has also reported that Mr. Casareto will oversee the preparation and filing of all past due SEC reports so that the Company can come into compliance with its reporting requirements. Recently, the NASD notified the Company's market makers that the Company's shares would be delisted from the OTC Bulletin Board on or about October 20, 1999 if the Company was not current in its reporting obligations. The Company also corrected certain information regarding the Company's NASD Bulletin Board listing status that appeared in a recent article in SmartMoney.com. The Company stated that it has not received any extensions from the OTC Bulletin Board to come into compliance with the requirements for continued listing and is obligated to be in compliance by October 20, 1999. The Company also confirmed that it is reviewing all of its financing options in light of the significant payables and overdue obligations in an effort to work with vendors, customers and other creditors to restructure its debt in a manner that will allow the Company to move forward with aggressive marketing and sales efforts. There can be no assurance that the Company will be successful in its efforts to restructure its debt and maintain its customer confidence and resolve the several other matters to be addressed by the new management team. Gary Player Direct is an international golf company with the strategic plan of establishing itself as a premier manufacturer and distributor of premium men and women's golf equipment, apparel and accessories principally under the Gary Player brand name through e-commerce, direct response television, direct mail sales and international licensing. These products will also be featured in the coming months on www.garyplayerdirect.com, the Company's new Internet site, which will incorporate full e-commerce capabilities, as well as news, information and golf instruction for golfers of all ages and skills. The statements in this press release relating to matters that are not historical are forward-looking statements which involve risks and uncertainties including, without limitation, economic and competitive conditions in the markets served by the Company affecting the demand for the Company's products, product pricing, market acceptance, access to distribution channels, availability of new financing, ability to cure license defaults, ability to timely file past due SEC reports and eliminate the risk of delisting noted above, and other risks detailed from time-to-time in the Company's Securities and Exchange Commission filings and press releases. These risks could cause actual results to differ materially from those anticipated or described herein. # # # 3 -----END PRIVACY-ENHANCED MESSAGE-----