EXHIBIT 10.29
Confidential Treatment has been requested with respect to portions of the
agreement indicated with an asterisk [*]. A complete copy of this agreement,
including the redacted terms, has been separately filed with the Securities and
Exchange Commission.
AMENDMENT NO. 1
TO
E-COMMERCE VENTURE AGREEMENT
This Amendment No 1 to E-Commerce Venture Agreement (the "Amendment")
is made and entered into on this 14th day of May, 1999, by and between GLOBAL
SPORTS INTERACTIVE, INC., a Pennsylvania corporation ("GSI"), and THE SPORTS
AUTHORITY, INC., a Delaware corporation ("TSA").
WHEREAS, the parties hereto are parties to that certain E-Commerce
Venture Agreement dated May 7, 1999 (the "Agreement"); and
WHEREAS, the parties hereto desire to amend the Agreement as set forth
herein;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements set forth herein, the parties hereto hereby agree as
follows:
1. AMENDMENTS. Sections 2.11, 3.3, 9.2(e) and 11.2 of the Agreement and
the definition of "Fair Market Value" contained in Section 9.5 of the Agreement
are amended in their entirety to read as follows:
2.11 "Net Sales" shall mean as defined by GAAP in the United
States.
* * *
3.3. INITIAL CAPITAL CONTRIBUTIONS. The Certificate of
Incorporation of ▇▇▇.▇▇▇ shall authorize the issuance of up to 16,000
shares of common stock, $.01 par value per share, and no other class of
equity securities. The Parties agree to cause ▇▇▇.▇▇▇ to issue and sell
to (i) GSI 8,001 shares of ▇▇▇.▇▇▇ common stock for the aggregate cash
purchase price of $[*], (ii) TSA 1,999 shares of ▇▇▇.▇▇▇ common stock
for the aggregate cash purchase price of $[*] and (iii) TSA 6,000
shares of ▇▇▇.▇▇▇ common stock in consideration of the Names (as
defined and provided for in the License Agreement) provided that such
6,000 shares shall only be issued and delivered, on or after February
1, 2002, promptly after the first to occur of the following: (a) TSA's
gross revenues for any TSA fiscal year, commencing with fiscal year
2001 and fiscal years
thereafter, shall exceed $[*] or (b) ▇▇▇.▇▇▇'s operating income
(excluding extraordinary items) for any ▇▇▇.▇▇▇ Fiscal Year, commencing
with Fiscal Year 2001 and Fiscal Years thereafter, shall exceed $[*].
* * *
9.2 (e):
(e) TSA shall have the option to terminate this
Agreement in the event that (i) either ▇▇▇.▇▇▇'s operating income,
excluding extraordinary items of income or expense, for the Fiscal Year
ended December 31, 2009 shall be less than [*] of ▇▇▇.▇▇▇'s Net Sales
for the Fiscal Year ended December 31, 2009, or (ii) ▇▇▇.▇▇▇'s Net
Sales for the Fiscal Year ended December 31, 2009 and determined in
accordance with GAAP, shall be less than [*]. In order to exercise such
option to terminate this Agreement, TSA shall give GSI written notice
of termination during the period commencing January 1, 2010 and ending
30 days after final ▇▇▇.▇▇▇ financial statements for the Fiscal year
ended December 31, 2009 are delivered to TSA. The Parties agree to
cause such financial statements to be prepared and delivered to TSA
prior to February 15, 2010.
* * *
11.2. EXCLUSIVE.
(a) During the term of this Agreement (i) TSA and its
Subsidiaries agree not to engage in the E-Commerce Business except as
permitted under Section 2.6(a) of the License Agreement, except that if
TSA acquires another business selling sporting goods, athletic footwear
and/or athletic apparel and related goods and services either through
land based stores or through catalog sales which is engaged in
e-commerce business, TSA can continue to operate the e-commerce
business of the acquired business until such time, if ever, that TSA
changes 50% or more of the acquired business's land based stores to
stores operating under the name "The Sports Authority" or any variation
thereof, or changes the catalog name to "The Sports Authority" or any
variation thereof, (ii) GSI agrees not to engage in and ▇▇▇.▇▇▇ shall
not engage in the sale of goods over the Internet as a shareholder,
partner or investor in any corporation, partnership, limited liability
company or other entity or venture which generates in excess of 20% of
its revenues from the sale of sporting goods, athletic footwear and
athletic apparel (other than with TJX Companies, Inc., ▇▇▇▇ Stores,
Inc. and any other such party which does not engage in the sale of
sporting goods, athletic footwear and athletic apparel in the
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United States, Canada, Japan, any other nation in which the predominant
language is English or any other nation in which TSA, any of its
Subsidiaries or any corporation, LLC or other entity or venture in
which TSA has more than a 19% interest engages in the sale of sporting
goods, athletic footwear and athletic apparel or has announced its
intention to commence doing so within six months and in fact does so)
(the foregoing shall not prevent GSI from taking the actions permitted
in Section 11.2(b)).
(b) ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇, ▇▇▇▇, ▇▇▇ agrees to devote its
e-commerce related activities to developing the TSA Site and the sites
of other retailers which have executed e-commerce services agreements
with GSI prior to the date of this Agreement, provided that (i) GSI may
enter into additional e-commerce services or e-commerce license
agreements with other retailers of sporting goods, athletic footwear or
athletic apparel, (ii) GSI may not commence providing any services to
develop any web site for such retailers until after the Launch Date (as
defined in the E-Commerce Agreement) and (iii) GSI may not launch any
web site for such retailers prior to January 1, 2000.
* * *
"Fair Market Value" of the ▇▇▇.▇▇▇ common stock held by the
Seller means (A) the value of the ▇▇▇.▇▇▇ common stock, considering
▇▇▇.▇▇▇ as a going concern being sold as an entirety, taking into
account net worth, past, present and prospective earnings and cash
flow, market conditions and prices paid in previous acquisitions of
similar businesses and specific valuations given to Internet-related
business and considering ▇▇▇.▇▇▇ as if ▇▇▇.▇▇▇ owned the Customer Data,
multiplied by (B) the percentage of the ▇▇▇.▇▇▇ common stock held by
the Seller.
2. DELETIONS. The penultimate sentence of Section 3.5 and all of
Section 3.6 of the Agreement are hereby deleted.
3. CONTINUING EFFECT. Except to the extent expressly amended pursuant
to this Amendment, the parties agree that each of the provisions of the
Amendment remain in full force and effect.
4. COUNTERPARTS. This Amendment may be executed in counterparts and
both such counterparts taken together shall be deemed to constitute the same
instrument.
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IN WITNESS WHEREOF, each of the Parties has caused this Amendment to be
executed on the date first above written.
GLOBAL SPORTS INTERACTIVE, INC.
By: /S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
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Name:
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Title:
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THE SPORTS AUTHORITY, INC.
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name:
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Title:
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