ASSET PURCHASE AGREEMENT

Exhibit 10.11

ASSET PURCHASE AGREEMENT

by and among

WGU, LLC

("Purchaser")

and

WOMEN’S GOLF UNLIMITED, INC.

("Seller")

Dated as of December 15, 2006

Confidential Treatment Requested.

Confidential Material in this document has been redacted

and filed separately with the Commission.

TABLE OF CONTENTS

i

TABLE OF CONTENTS

LIST OF SCHEDULES

ii

TABLE OF CONTENTS

LIST OF EXHIBITS

Asset Purchase Agreement   --

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ASSET PURCHASE AGREEMENT

This ASSET PURCHASE AGREEMENT (this "Agreement") is made as of December 15, 2006, by and among WGU, LLC, a Texas limited liability company ("Purchaser"), and WOMEN’S GOLF UNLIMITED, INC., a New Jersey corporation ("Seller"), and, solely for the purposes of Section 10.16 of this Agreement, ADAMS GOLF LTD. a Texas Limited Partnership ("Purchaser Parent").

RECITALS OF THE PARTIES:

A.   Seller has been engaged in the business, among other things, of designing, manufacturing, assembling, distributing and selling women’s golf clubs and related products   (the "Business").

B.   Seller desires to sell to Purchaser, and Purchaser desires to purchase from Seller, certain of Seller’s assets used in the Business free and clear of any and all Liens upon the terms and conditions set forth in this Agreement.

C.   The parties desire to make certain representations, warranties and covenants in connection with the transactions contemplated by this Agreement.

D.   In light of Seller’s ownership of the Assets, and the contributions of Seller in the past to the growth and development of the Business, one of the conditions to the consummation by Purchaser of the transactions contemplated in this Agreement is that Seller agree to certain covenants contained in this Agreement and in the Operative Documents (as hereinafter defined) for the purpose of transferring to the Purchaser all of the goodwill, proprietary rights and going concern value of the Assets (as hereinafter defined).

NOW, THEREFORE , in consideration of the mutual benefits to be derived and the representations and warranties, agreements and promises herein contained, and other good and valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties hereto hereby agree as follows:

AGREEMENTS:

1.1   Definitions. Unless otherwise stated in this Agreement, the following terms shall have the following meanings:

" Accounting Firm ": Means a neutral, national or regional accounting firm selected by the parties.

" Affiliate ": Any Person that, directly or indirectly, controls, or is controlled by, or under common control with, another Person. For the purposes of this definition, "control" (including the terms "controlled by" and "under common control with"), as used with respect to any Person, means the power to direct or cause the direction of the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities or by contract or otherwise.

" Agreement ": As defined in the first paragraph of this Agreement.

" Agreement to Preserve Corporate Opportunity ": The Agreement to Preserve Corporate Opportunity, in substantially the form attached hereto as Exhibit A .

" Annual Financial Statements ": As defined in Section 3.5(a) hereof.

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" Applicable Law ": All applicable provisions (domestic or foreign) of all (i) constitutions, treaties, statutes, laws (including the common law), rules, regulations, ordinances, codes and Orders of or with any Governmental Authority and (ii) Governmental Consents.

" Assets ": As defined in Section 2.1 hereof.

" Assignment of Proprietary Rights ": The Assignment of Proprietary Rights, in substantially the form attached hereto as Exhibit B .

" Bill of Sale ": The Bill of Sale, in substantially the form set forth in Exhibit C .

" Business ": As defined in the Recitals of the Parties.

" Closing ": As defined in Section 8 hereof.

" Closing Date ": As defined in Section 8 hereof.

" Code ": The Internal Revenue Code of 1986, as amended.

"Confidentiality Agreement" : As defined in Section 5.13 hereof.

" Consent ": Any consent, approval, authorization, action, waiver, permit, grant, franchise, concession, agreement, license, exemption or Order of any Person (including foreign Persons), including any Governmental Authority.

" Customer Data ": Seller’s current customer list and corresponding contact information, sales records (including pricing information and customer contractual status), other records, telephone numbers and fax numbers, email addresses, current accounts receivable aging, and other customer data (including credit data) relating to the Assets.

" Damages ": Any and all damages, claims, obligations, expenses, demands, assessments, penalties, Liabilities (joint or several), costs, losses, diminution in value, defenses, judgments, disbursements and expenses (including disbursements, expenses and reasonable fees of attorneys, accountants and other professional advisors and of expert witnesses, costs of investigation and preparation, and costs of settlement) of any kind whatsoever, whether fixed or contingent, suffered or incurred by a Person, without regard to the timing of any payment or performance.

" Disclosure Schedules ": The disclosure schedules to this Agreement delivered by Seller to Purchaser on the date hereof.

" Earn Out Obligation ": As defined in Section 2.2(b) hereof.

" Earn Out Period ": Means the twelve month period from (1) if the Closing occurs prior to January 1, 2007, January 1, 2007 through December 31, 2007; or (2) if the Closing occurs after January 1, 2007, thirteen (13) months after the Closing.

" Excluded Liabilities ": As defined in Section 2.4 hereof.

"Final Accounting" : As defined in Section 2.3(e) hereof.

" Financial Statements ": As defined in Section 3.5(a) hereof.

" GAAP ": As defined in Section 1.2 hereof.

" Governmental Consent ": Any Consent of, from or with any Governmental Authority.

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" Governmental Authority ": Any federal, state, municipal, court or other governmental department, commission, board, bureau, agency, authority or instrumentality, domestic or foreign.

" including " or " includes ": Means including or includes without limitation.

" Indemnified Person ": As defined in Section 9.4 hereof.

" Indemnifying Person ": As defined in Section 9.4 hereof.

" Initial Cash Amount ": As defined in Section 2.2(a) hereof.

" Intangible Assets ": As defined in Section 2.1(a) hereof.

" Interim Financial Statements ": As defined in Section 3.5(a) hereof.

" IRS ": The Internal Revenue Service.

" JAMS ": As defined in Section 10.12(a) hereof.

" Liability ": Means any commitments, liabilities, obligations (including contract and capitalized lease obligations), indebtedness, accounts payable, accrued expenses of any nature whatsoever, losses, Damages, costs, expenses and personal injuries (whether any of the foregoing are known or unknown, secured or unsecured, asserted or unasserted, absolute or contingent, direct or indirect, accrued or unaccrued, liquidated or unliquidated and/or due or to become due), including any liability or obligation for Taxes.

" Liens ": All mortgages, deeds of trust, claims, liens, security interests, pledges, leases, conditional sale contracts, rights of first refusal, options, charges, Liabilities, obligations, agreements, powers of attorney, limitations, reservations, restrictions and other encumbrances of any kind or character.

"Limited License Agreement" : The Limited License Agreement, in substantially the form set forth in Exhibit D .

" Material Adverse Effect ": (i) Any change, development or effect (individually or in the aggregate) that is materially adverse to the Assets or the goodwill, or condition thereof (whether or not the result thereof would be covered by insurance) or (ii) any fact or development that could (individually or in the aggregate) impair the ability of Seller or Purchaser to consummate the Transactions; provided, however , that "Material Adverse Effect" shall exclude any effect arising out of or resulting from (a) general economic, regulatory or political conditions or events; (b) changes affecting the industry in which the Business operates; (c) the execution of this Agreement or any of the Operative Documents; or (d) any action taken by Seller or Purchaser or any of their respective representatives or other action required by the terms of this Agreement or necessary to consummate the Transactions.

" Operative Documents ": This Agreement, the Agreement to Preserve Corporate Opportunity, the Assignment of Proprietary Rights, the Bill of Sale, the License Agreement and all other agreements, instruments, documents, exhibits, schedules and certificates executed and delivered by or on behalf of Seller or Purchaser at the Closing pursuant to this Agreement.

" Order ": Any order, writ, injunction, decree, judgment, award or determination of, or agreement with, any Governmental Authority.

" Permits ": All permits, authorizations, certificates, approvals, registrations, variances, exemptions, franchises, privileges, immunities, grants, ordinances, licenses and other rights of every kind and character, issued, applied for or pending (i) under any (A) Applicable Law; (B) Order or (C) contract with any Governmental Authority or (ii) granted by any Governmental Authority.

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" Person ": An individual, partnership, joint venture, corporation, company, limited liability company, bank, trust, unincorporated organization, Governmental Authority or other entity or group.

" Proceeding ": Any action, claim, suit, proceeding, litigation, arbitration, mediation, investigation, inquiry, or audit commenced, brought, conducted or heard by or before any Governmental Authority or arbitrator..

" Purchase Price ": As defined in Section 2.2 hereof.

" Purchaser ": As defined in the first paragraph of this Agreement.

" Purchaser Parent ": As defined in the first paragraph of this Agreement.

" Purchaser Indemnitees ": As defined in Section 9.2 hereof.

" Seller ": As defined in the first paragraph of this Agreement.

" Seller Indemnitees ": As defined in Section 9.3 hereof.

"Supplier Data" :   All of Seller’s supplier and vendor lists, records, telephone and fax numbers, email addresses and publications and marketing material relating to the purchase of raw materials, goods, utilities and other supplies and services used in connection with the Assets.

" Revenue ": As defined in Section 2.3(a) hereof.

" Taxes " (including, with correlative meaning, " Taxes " and " Taxable "): Means (i)(A) any net income, gross income, business and occupation, admissions, gross receipts, sales, use, value added, ad valorem, transfer, transfer gains, franchise, profits, license, withholding, payroll, employment, excise, severance, stamp, rent, recording, occupation, premium, real or personal property, intangibles, environmental or windfall profits tax, alternative or add-on minimum tax, customs duty or other tax, fee, duty, levy, impost, assessment or charge of any kind whatsoever, together with (B) any interest and any penalty, addition to tax or additional amount imposed by any Governmental Authority (domestic or foreign) (a "Tax Authority") responsible for the imposition of any such tax; (ii) any Liability for the payment of any amount of the type described in the immediately preceding clause (i) as a result of being a member of a consolidated, affiliated, unitary or combined group with any other corporation or entity at any time prior to and through the effective time of Closing and (iii) any Liability for the payment of any amount of the type described in the preceding clauses (i) or (ii) as a result of a contractual obligation to any other Person or of transferee, successor or secondary Liability.

" Tax Returns ": Means any report, return or other information (including any attached schedules or any amendments to such report, return, document, declaration or any other information) required to be supplied to or filed with any Tax Authority or jurisdiction (foreign or domestic) with respect to any Tax, including an information return or any document with respect to or accompanying payments.

"Termination Date" : As defined in Section 7.2(a) hereof.

" Threatened ": Any matter or thing will be deemed to have been Threatened when used herein with respect to any party if that party has received notice from the Person to whom the threat is attributable or such Person’s agents, which notice makes reference to or identifies the matter or thing being threatened or that party observes an action by the Person to whom the threat is attributable or such Person’s agents that in the exercise of reasonable business judgment would reasonably be expected to cause such party to believe that the matter or thing is being threatened.

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" Transaction " or " Transactions ": The sale and purchase of the Assets, the performance of covenants and the other transactions contemplated hereby and by the Operative Documents, in each case as described by this Agreement and the Operative Documents.

" Transaction Expenses ": The expenses incurred in connection with the preparation, negotiation, execution and performance of this Agreement and the consummation of the Transactions, including all fees and expenses of counsel and representatives and any and all employee compensation, retention bonuses or incentive compensation related to or resulting from the Transactions, whenever occurring.

" Transfer Taxes ": As defined in Section 5.10 hereof.

" WGU Trademarks ": Means the trademarks set forth on Schedule 2.1(a) .

" Wire Transfer ": Means a payment of money by same day wire transfer in immediately available funds to an account or account designated in writing by the recipient to the payor at least two (2) days prior to the date of payment; provided, however , that if the recipient fails to make such designation prior to the payment due date, the term shall instead mean payment of money by overnight delivery of a certified or cashier’s check of a federally insured financial institution.

1.2   Accounting Terms and Definitions. Unless otherwise specified herein, all accounting terms used herein shall be interpreted, all accounting determinations hereunder shall be made, and all financial statements required to be delivered hereunder shall be prepared, in accordance with generally accepted accounting principles published by the Financial Accounting Standards Board as in effect from time to time, applied on a consistent basis ("GAAP").

2.1   Agreement to Purchase and Sell. Subject to the applicable terms and conditions of this Agreement, at the Closing, Seller shall sell, transfer, assign, convey and deliver to Purchaser, and Purchaser shall purchase, all of the following assets that are currently owned by Seller (such assets, being collectively referred to as the "Assets"), free and clear of all Liens:

(a)   Intellectual Property and Intangible Assets . All intellectual property rights owned by, licensed to, or used by, Seller in the Business, including all proprietary information, know-how, designs, plans, other trade secrets, business and marketing plans, copyrights, all registered or unregistered trademarks, service marks, trade dress and trade names (whether or not registered or registrable), common law copyrights and registered copyrights, all names, logos, labels and slogans, in each case used by Seller in connection with the Assets, all registrations or applications for registration for any of the above and any right to recovery for infringement thereof (including past infringement) and any and all goodwill associated therewith or connected with the use thereof (collectively, the "Intangible Assets"). The Intangible Assets shall include all right, title and interest in and to the names set forth on Schedule 2.1(a) and any derivations of such names and in the same manner historically used, and all of Seller’s rights to email addresses, Internet domain names (including the domain names set forth on Schedule 2.1(a) ), and URLs.

(b)   Customer Data and Supplier Data . All of the Customer Data   and Supplier Data.

(c)   Books and Records . All of Seller’s books, records, papers, files and instruments of whatever nature and wherever located that relate solely to the Assets or that are required or necessary in order for Purchaser to utilize the Assets from and after the Closing in the manner in which it has been historically utilized, including graphic materials, diagrams, designs, specifications, warranties, guaranties, media, sales and marketing literature, brochures or other sales aids, catalogs, price lists, mailing lists, sales (of which complete copies shall be provided to Purchaser).

(d)   Warranty Rights . To the extent transferable, the benefit of and the right to enforce the covenants and warranties, if any, that Seller is entitled to enforce with respect to the Assets.

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2.2   Purchase Price. Subject to the terms and conditions of this Agreement, the total purchase price for the Assets (the "Purchase Price") to Seller shall be as follows:

(a)   $600,000 shall be paid by Wire Transfer at Closing (the "Initial Cash Amount"); and

(b)   the earn out obligation in an aggregate maximum amount up to $400,000 (the "Earn Out Obligation") will be paid by Wire Transfer in accordance with Section 2.3 below.

2.3   Earn Out Obligation.

Subject to the terms and conditions of this Agreement, the Earn Out Obligation, if earned, shall be paid by Purchaser to Seller as follows:

(a)   The amount payable by Purchaser to Seller under the Earn Out Obligation shall equal [****] ¹   of net revenue (defined as gross revenue less discounts and allowances, but excluding early payment discounts) as calculated in accordance with GAAP (the "Revenue") attributable to sales of Purchaser products using the WGU Trademarks through customary wholesale or retail distribution channels, based on the books and records of the Purchaser (as identified by a specific accounting code assigned to such Revenue), up to a maximum aggregate Earn Out Obligation of $400,000 for the Earn Out Period.

(b)   The Earn Out Obligation, if any, payable by Purchaser under Section 2.3(a) to Seller shall be payable at the end of each three (3)-month period (as earned) within forty-five (45) days after the end of such three (3)-month period of the Earn Out Period. At the time of each payment, Purchaser shall provide to Seller a written report detailing Purchaser’s Revenue from the sale of Purchaser products using the WGU Trademarks during the three (3)-month period to which the payment relates and shall include in such report an accounting of the Revenue on a per customer basis.

(c)   After the end of each quarter during the Earn Out Period, Revenue shall be recalculated by Purchaser on a period-to-date basis. All calculations and determinations under Sections 2.3(a) and 2.3(b) hereof shall be made by Purchaser and reported to Seller by the applicable payment dates set forth in Section 2.3(b). If such calculations and determination indicate that Seller received payments in any applicable period that were greater than the amount to which Seller was entitled during such period, such excess shall be deducted from the next payment or, if greater than the next payment, remitted from Seller to Purchaser by Wire Transfer within ten (10) days of Purchaser’s becoming aware of such excess. If, after such determination, Revenue for the applicable period is greater than originally calculated, Purchaser shall remit the shortfall to Seller by Wire Transfer within ten (10) days of Seller’s becoming aware of such shortfall.

(d)   The determinations of Purchaser under Section 2.3(c) shall be conclusive and binding upon the parties on the thirtieth (30 ^th ) day after receipt by Seller of each such determination, unless Seller, within such 30-day period, requests that a determination be reviewed by the Accounting Firm. Upon any such request, the Accounting Firm shall either confirm such original determination or make such changes therein as it deems appropriate, and, after such review and any change deemed appropriate by the Accounting Firm, such determination shall be conclusive and binding upon the parties. If any such change results in an increase to the Earn Out Obligation of more than 3%, the cost of such determination by the Accounting Firm shall be borne by Purchaser; otherwise the cost shall be borne by Seller.

(e)   Within 60 days of the end of the Earn Out Period, Purchaser shall provide Seller with an accounting of the total Revenue attributable to sales of Purchaser products using the WGU Trademarks during the Earn Out Period (the "Final Accounting"). If the Final Accounting determines that Seller received payments during the Earn Out Period that were greater than the amount to which Seller was entitled during the Earn Out Period, such excess shall be promptly remitted from Seller to Purchaser by Wire Transfer within ten (10) days of Purchaser’s becoming aware of such excess. If the Final Accounting determines that Revenue for the Earn Out Period is greater than originally calculated, and subject to the aggregate maximum amount set forth in Section 2.2(b), Purchaser shall promptly remit the shortfall to Seller by Wire Transfer within ten (10) days of Seller’s becoming aware of such shortfall.

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(f)   As an express condition of Purchaser making any Earn Out Obligation payments to Seller, Seller shall preserve and maintain its corporate existence and good standing under Applicable Law of the State of New Jersey for the duration of the Earn Out Period and for 60 days thereafter.

2.4   No Assumption of Liabilities. Purchaser does not assume or agree to pay, perform or discharge, and shall not be responsible for, any Liabilities of Seller of any kind whatsoever, whether accrued, absolute, known or unknown, contingent or otherwise ("Excluded Liabilities"). Without limiting the generality of the foregoing, and notwithstanding any other provision hereof or of any Operative Document and regardless of any disclosure to or investigation by Purchaser, neither Purchaser nor any of its Affiliates shall assume or have any liability for any Liabilities of Seller or any of its Affiliates, that in any manner relates to or arises out of the operation of the Business or the ownership or use of the Assets during any period on or prior to the Closing Date.

2.5   Allocation of Purchase Price.

(a)   As set forth on Schedule 2.5 , the Purchase Price (as adjusted and as to be adjusted pursuant to the terms of this Agreement) for the Assets has been allocated in accordance with Section 1060 of the Code.

(b)   The parties shall each report the federal, state and local and other Tax consequences of the purchase and sale contemplated hereby (including the filing of IRS Forms 8594) in a manner consistent with such allocation schedule and shall not make any inconsistent written statement or take any inconsistent position on any Tax Returns during the course of any IRS or other Tax audit, for any financial or regulatory purpose, in any litigation or investigation or otherwise.

(c)   Each party shall promptly notify the other party if it receives notice that the IRS proposes any allocation different from the allocation agreed upon in accordance with this Section 2.5.

2.6   Seller Deliveries . At the Closing, Seller shall deliver, as appropriate, or cause to be delivered to Purchaser the following:

(a)   an Agreement to Preserve Corporate Opportunity, in substantially the form of Exhibit A , hereto,

(b)   an Assignment of Proprietary Rights, in substantially the form of Exhibit B hereto;

(c)   a Bill of Sale, in substantially the form of Exhibit C hereto; and

(d)   the Limited License Agreement, in substantially the form of Exhibit D , hereto.

(e)   an Officer’s Certificate duly executed by an officer of Seller certifying to (i) Seller’s Certificate of Incorporation, as amended, attached thereto (as certified as of a recent date by the Secretary of State of the State of New Jersey; (ii) to the due adoption by Seller’s Board of Directors and by the shareholders of Seller of corporate resolutions attached to such Officer’s Certificate authorizing the Transactions and the execution and delivery of this Agreement, the Operative Documents and the other agreements and documents contemplated hereby and thereby and the taking of all actions contemplated hereby and thereby; and (iii) to the incumbency and true signatures of those officers of Seller duly authorized to act on its behalf in connection with the Transactions and this Agreement and to execute and deliver this Agreement and the Operative Documents;

(f)   Certificates of Existence and Good Standing for Seller issued by the Secretary of State of the State of New Jersey, and a clearance certificate or similar document(s) that may be required by any state or foreign Tax Authority in order to relieve Purchaser of any obligation to withhold any portion of the Purchase Price, at a date not more than ten (10) days prior to the Closing Date;

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(g)   all Consents, if any, necessary to consummate the Transactions;

(h)   the Disclosure Schedules;

(i)   possession or constructive possession of the Assets, free and clear of any and all Liens; and

(j)   such certificates, including evidence of any lien holders’ release of lien on any of the Assets, and other evidence as may be required in order to consummate the Transactions.

2.7   Purchaser Deliveries. At the Closing, Purchaser shall execute and deliver, as appropriate, or cause to be delivered to Seller the following:

(a)   the Initial Cash Amount of the Purchase Price to Seller, as provided herein;

(b)   an Agreement to Preserve Corporate Opportunity, in substantially the form of Exhibit A , hereto,

(c)   an Assignment of Proprietary Rights, in substantially the form of Exhibit B hereto;

(d)   a Bill of Sale, in substantially the form of Exhibit C hereto; and

(e)   the Limited License Agreement, in substantially the form of Exhibit D hereto;

(f)   an Officer’s Certificate dated the Closing Date signed by an officer of Purchaser certifying to (i) the Certificate   of Formation of Purchaser; (ii) the due adoption by the Purchaser’s Board of Managers of resolutions, a copy of which shall be attached thereto, approving the execution and delivery of this Agreement, the Operative Documents and the other agreements and documents contemplated hereby and thereby and the taking of all actions contemplated hereby and thereby; and (iii) the incumbency and true signatures of those officers of the Purchaser duly authorized to act on its behalf in connection with the Transactions and this Agreement and to execute and deliver this Agreement and the Operative Documents; and

(g)   a Certificate of Existence and Account Status issued by the Texas Secretary of State and the Office of the Comptroller of Public Accounts of the State of Texas at a date not more than ten (10) days prior to the Closing Date.

Seller hereby represents and warrants to Purchaser that the following are true, correct and complete as of the date of this Agreement and Closing, regardless of what investigations, if any, Purchaser shall have made prior hereto or prior to the Closing:

3.1   Organization; Good Standing. Seller is a corporation duly organized, validly existing and in good standing under Applicable Laws of the State of New Jersey. Seller has full corporate power and authority to own and lease the Assets and to carry on the Business as previously conducted. Seller is duly qualified in each jurisdiction in which it transacts business.

3.2   Authority Relative to this Agreement; Enforceability. Seller has full power and authority (corporate and otherwise) to execute, deliver and perform this Agreement (including execution, delivery and performance of the Operative Documents to which it is a party) and to consummate the Transactions. The execution and delivery by Seller of this Agreement and each of the Operative Documents, and the consummation of the Transactions, have been duly and validly authorized by the Board of Directors of Seller and the shareholders of Seller in accordance with Applicable Law and no other corporate proceedings on the part of Seller are necessary with respect thereto. This Agreement has been duly and validly executed and delivered by Seller, and constitutes a legal, valid and binding obligation of Seller, enforceable against it in accordance with its terms (subject, as to enforcement, to applicable bankruptcy, insolvency, moratorium, reorganization or similar Applicable Laws affecting creditors’ rights generally and to general equitable principles).

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3.3   Consents and Approvals. Except as set forth in Schedule 3.3 , or otherwise required by this Agreement or the Operative Documents, the execution, delivery and performance by Seller of this Agreement and each of the Operative Documents and the consummation of the Transactions by it do not require any Consent of, or Order by, any Governmental Authority or any Consent of, or giving of notice to, any other Person.

3.4   No Violations. The execution, delivery and performance of this Agreement and each of the Operative Documents by Seller, the consummation by Seller of the Transactions and compliance by Seller with any of the provisions hereof and the Operative Documents, does not and will not (a) conflict with or result in any breach or violation of any provision of the Certificate of Incorporation, as amended, or Bylaws, as amended, of Seller, (b) result in the creation or imposition of any Lien on any of the property of Seller (including the Assets) or (c) violate any Order or Applicable Law with respect to any Seller, the Business or the Assets.

3.5   Financial Statements; No Undisclosed Liabilities.

(a)   Schedule 3.5(a) sets forth correct and complete copies of the (i) unaudited financial statements of Seller at and for the year ended December 31, 2005 (collectively, the "Annual Financial Statements") and (ii) the unaudited financial statements of Seller at and for the year-to-date periods ended November 30, 2006 (the "Interim Financial Statements"), including in each case, a balance sheet and income statement (the Annual Financial Statements and Interim Financial Statements collectively referred to as the "Financial Statements").

(b)   Except as set forth in Schedule 3.5(b) , the Financial Statements have been prepared from the books and records of Seller in accordance with GAAP, consistently applied and consistent with Seller’s and the Business’ past practices, and on that basis fairly present, the properties, assets, liabilities, financial position and results of operations of the Business (subject to normal, recurring year-end adjustments disclosed on Schedule 3.5(b) , which do not, and will not, have any Material Adverse Effect on Seller, the Business or the Assets) as of the respective dates thereof and for the respective periods indicated.

3.6   Absence of Undisclosed Liabilities. Except as set forth on Schedule 3.6 and except as and to the extent reflected and reserved against in the Interim Financial Statements or accrued in the ordinary course of business since the date of the Interim Financial Statements, the Business has no material Liability of any nature whatsoever, including any Liabilities relating to or arising out of any act, omission, transaction, circumstance, sale of products, statement of facts or other condition that occurred or existed on or before the Closing, whether or not due or payable.

3.7   Litigation and Related Matters. There is no Proceeding pending or, to the knowledge of Seller, Threatened against, relating to or affecting the Assets or the Transactions. Seller is not subject to any currently existing Proceeding by any Governmental Authority or any other Person. 

3.8   Absence of Certain Changes.

Since the date of the Interim Financial Statements, Seller has owned and operated the Assets.

3.9   Taxes.

(a)   All Taxes that are due and payable by Seller through the Closing, have been timely paid, and Seller has timely filed all Tax Returns required by any Applicable Law to be filed through the Closing. All such Tax Returns are true, complete and correct.

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(b)   Seller has paid or has maintained adequate accruals on Seller’s books and the Interim Financial Statements for all Taxes (whether or not shown on a Tax Return and whether or not presently due and payable), including contingent Tax Liabilities, with respect to (i) all Taxable periods ending on or before the Closing Date and (ii) all Taxable periods starting before and ending after the Closing Date to the extent attributable to the portion of such periods up to and including the Closing Date.

(c)   Seller is not delinquent in the payment of any Tax relating to the Business or the Assets.

(d)   There is no Tax deficiency asserted against Seller, and there is no unpaid assessment, proposal for additional Taxes, deficiency or delinquency in the payment of any of the Taxes of Seller or Sellers relating to the Business or the Assets, or, to the knowledge of Seller, any violation of any Applicable Law that could be asserted by any Governmental Authority.

(e)   There are no Liens for Taxes against Seller upon any properties or assets of Seller (including the Assets), nor has notice been given of any event that could lead to any such Lien.

(f)   No IRS, state or local Proceeding involving Seller is in progress, pending, or, to the knowledge of Seller, Threatened or contemplated and the results of any completed audits or other Proceedings are properly reflected in the Interim Financial Statements.

(g)   Seller has not committed any violation of any Applicable Law regarding Taxes.

(h)   All amounts required to be withheld by Seller from employees, independent contractors, shareholders, creditors or others or collected from customers for income Taxes, social security and unemployment insurance Taxes and sales, excise and use Taxes, and such Taxes to be paid by Seller or set aside in accounts for any such purpose, have either been paid to the applicable Governmental Authority or been accrued, reserved against and entered upon Seller’s books and Interim Financial Statements.

(i)   Seller acknowledges that Seller is responsible for any Taxes accrued through the Closing Date.

(j)   Seller is a United States person within the meaning of Section 7701(a)(30) of the Code.

Each reference to a provision in this Section 3.9 shall be treated for state, local and foreign Tax purposes as reference to analogous or similar provisions for state, local and foreign law.

3.10   Compliance with Law.

(a)   Neither Seller, the Business nor the Assets is in violation of any Applicable Law, where such violation would be expected to have a Material Adverse Effect on the Seller, the Business or the Assets. Seller is not aware of, nor prior to the date hereof, has it received notice of, any past, present or future conditions, events, practices or incidents that could be expected to interfere with, or prevent the Assets’ compliance or continued compliance with, Applicable Law after the Closing.

(b)   Schedule 3.10(b) sets forth all Permits and Governmental Consents necessary for, or otherwise material to, or used in, the ownership, use or operation of the Assets. Except as set forth in Schedule 3.10(b) , all such Permits and Governmental Consents have been duly obtained and are in full force and effect.

3.11   Title to Assets.  Seller has good and indefeasible title to all of the Assets, including any Assets whose ownership remains listed under the prior name of Seller, S2 Golf, Inc., and the Assets are free and clear of all Liens. Except in this Agreement, Seller has not sold, transferred, leased, assigned or otherwise disposed of any of the Assets, or agreed to do so. Upon consummation of the Transactions, Purchaser will own the Assets free and clear of all Liens.

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3.12   Customers.

Seller is not aware of any fact or reason that could prohibit the continuance or otherwise impair in any material respect the relationship of Purchaser with Seller’s customers after Closing. Schedule 3.12 sets forth a true and correct list of the twenty-five (25) largest customers in terms of sales during the fiscal years ended December 31, 2005, and during the year-to-date period ended June, 2006, showing the approximate total sales to each such customer during each of such periods. Except as set forth on Schedule 3.12 , to Seller’s knowledge, there has not been any material adverse change in the business relationship of Seller with any customer set forth on Schedule 3.12 . Except as set forth on Schedule 3.12 , Seller does not currently have any material outstanding and/or unresolved claims or issues asserted by any customers. Seller does not have any prepayments or deposits of any kind from any customers.

3.13   Proprietary Rights. Seller owns or validly licenses the right to use all Intangible Assets. Seller has exercised reasonable efforts to protect its Intangible Assets. Except as reflected on Schedule 3.13 , no Consent of any Person will be required for the use of the Intangible Assets by Purchaser after the consummation of the Transactions contemplated hereby, and the Transactions will not result in any breach of any agreement relating to any Intangible Assets. No claim or opposition has been asserted by any Person to the ownership of or Seller’s right to use any of the Intangible Assets or challenging or questioning the validity or effect of any license or agreement relating thereto. Each of the Intangible Assets is valid and subsisting, has not been canceled, abandoned or otherwise terminated and, if applicable, has been duly asserted, registered and filed. The Intangible Assets owned by Seller are owned free and clear of all Liens. To Seller’s knowledge, Purchaser’s use of the Intangible Assets as such assets have historically been utilized, will not infringe on or violate the rights of any other Person. No Proceedings have been instituted, are pending or, to Seller’s knowledge, Threatened or are contemplated that challenge or oppose the rights of Seller with respect to any of the Intangible Assets. Seller has not received any notice or inquiry from any Person, and is not aware of, any alleged infringement by Seller of any intellectual property right. Except as set forth on Schedule 3.13 , Seller has not given nor is it bound by any agreement of indemnification in connection with any Intangible Assets.

3.14   Permits. Seller has all Permits necessary or required for the ownership of the Assets. Except as set forth on Schedule 3.14 , each of the Permits is transferable, and the Permits will be transferred to Purchaser on the Closing Date, or as soon thereafter as permitted or possible, in accordance with Applicable Law or the requirements of the issuing Governmental Authority.

3.15   Product Warranties. There is no claim against or Liability of Seller on account of product warranties or with respect to the sale or distribution of products, including any amount due to any customer by reason of any understanding or agreement between Seller and any customer. There is no claim against any vendor by, or any liability of any vendor of Seller to, any customer of Seller.

3.16   Product Liability. To Seller’s knowledge, Seller does not have any Liability arising out of any injury to individuals or property as a result of the ownership, possession or use of any Asset. 

3.17   Absence of Certain Business Practices. Neither Seller, nor any director, officer, shareholder, or employee or agent of Seller, nor any other Person acting on Seller’s behalf, has, directly or indirectly, within the past five (5) years given or agreed to give any gift or similar benefit to any customer, supplier, governmental employee or other Person who is or may be in a position to help or hinder the Business (or assist in connection with any actual or proposed transactions) which (a) could subject Seller or any such Person to any damage or penalty in any civil, criminal or governmental Proceeding, (b) if not given in the past, could have had a Material Adverse Effect on the Business as reflected in the Financial Statements or (c) if not continued in the future, could have a Material Adverse Effect on the Business or which could subject Seller or any such Person to suit or penalty in any private or governmental Proceeding.

3.18   Third-Party Payments. Except as set forth in Schedule 3.18 , no finder, broker or other Person is entitled to any commission, fee or other compensation in connection with any of the Transactions contemplated by this Agreement.

3.19   Disclosure . 

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To the best of Seller’s knowledge, Seller has delivered or made available to Purchaser true, correct and complete copies of all documents listed on the Disclosure Schedule. To the best of Seller’s knowledge, there is no fact known to Seller that has specific application to the Assets that could reasonably be expected to have a Material Adverse Effect.

Purchaser hereby represents and warrants to Seller that the following are true, correct and complete as of the date of this Agreement, regardless of what investigations, if any, Seller shall have made prior hereto or prior to the Closing:

4.1   Organization. Purchaser is a limited liability company organized and validly existing under Applicable Laws of the State of Texas.

4.2   Authority Relative to this Agreement. Purchaser has full power and authority to execute, deliver and perform this Agreement (including execution, delivery and performance of the Operative Documents) and to consummate the Transactions. The execution and delivery by Purchaser of this Agreement and the Operative Documents, and the consummation of the Transactions, have been duly and validly authorized by the Board of Managers of the Purchaser and no other corporate proceedings on the part of Purchaser are necessary with respect thereto. This Agreement has been duly and validly executed and delivered by Purchaser, and constitutes a legal, valid and binding obligation of Purchaser enforceable in accordance with its terms (subject, as to enforcement, to applicable bankruptcy, insolvency, moratorium, reorganization or similar Applicable Laws affecting creditors’ rights generally and to general equitable principles).

4.3   Consents and Approvals. No Consent from or of any Governmental Authority or any other Person is necessary in connection with the execution, delivery or performance of this Agreement by Purchaser other than Consents which have already been obtained.

4.4   Absence of Litigation. There is no Proceeding pending, or to the knowledge of Purchaser, Threatened that would impair or infringe upon Purchaser’s ability to perform as agreed pursuant to this Agreement.

4.5   Third Party Payments. No finder, broker or other Person is entitled to any commission, fee or other compensation in connection with any of the Transactions contemplated by this Agreement as a result of any action by Purchaser.

4.6   Availability of Funds. Purchaser has sufficient cash available to enable it to consummate the Transactions, including the delivery of the Initial Cash Amount.

5.1   Purchaser Investigation. No investigations by Purchaser or its employees, representatives or agents shall reduce or otherwise affect the Liability of Seller with respect to any representations, warranties, covenants or agreements made herein or in an exhibit, schedule or other certificate, instrument, agreement or other Operative Document (including the Disclosure Schedules), executed or delivered in connection with this Agreement.

5.2   Further Assurances. At any time after the Closing Date, if any further action is necessary, proper or advisable to carry out the terms, purposes and intent of this Agreement, then, as soon as is reasonably practicable, each party to this Agreement shall take, or cause its proper officers to take, such action. Without limiting the generality of the foregoing, Seller shall execute and deliver to Purchaser such instruments of transfer as shall be reasonably necessary or appropriate to vest in Purchaser good and indefeasible title to the Assets. Each party hereto further agrees to cooperate fully with the other party after the consummation of the Transactions for the purpose of providing Purchaser with the information and access to information necessary to ensure Purchaser with a reasonably smooth transition into the ownership and use of the Assets.

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5.3   ConsentsNotwithstanding any other provision of this Agreement, to the extent that the assignment by Seller of any Asset to be sold or assigned hereunder shall require the Consent of another Person thereto, the consummation of the Transactions shall not constitute an assignment or attempt at an assignment thereof if such assignment or attempted assignment would constitute a breach thereof. If any Consent of a third Person with respect to any one or more of the Assets is not obtained at or prior to Closing, each party hereto agrees to take whatever action that may be necessary to provide Purchaser with the uninhibited benefits of such Assets, subject to the assumption by Purchaser of Seller’s obligations thereunder, until such Consent is obtained.

5.4   Agreement Regarding Brokers. Each party agrees that it will pay or dispute, and hold the other parties harmless from, any claims of brokers or others for finder’s or brokerage fees or commissions asserted as a result of representations by such party to such brokers or others, regardless of whether the existence of such brokers or others are disclosed herein.

5.5   Public Announcements The parties agree to consult with each other prior to making any public announcement or other public disclosure concerning the Transactions contemplated by this Agreement. Except as otherwise required by Applicable Law, neither party shall and shall not permit any of its respective Affiliates, agents or representatives to, make, directly or indirectly, a public announcement regarding the Transactions without the prior written consent of the other party, which consent shall not be unreasonably withheld, conditioned or delayed. If a party is required by Applicable Law to make any such disclosure, it must provide notice of such requirement, as soon as practicable, to the other party and shall provide the other party reasonable opportunity to review and comment on any proposed announcement prior to its disclosure.

5.6   Information; Inspection of Records. Seller shall cooperate with Purchaser after the Closing by providing Purchaser, in each case without any additional consideration, but at the expense of Purchaser, promptly upon request, access to such books and records and other information regarding or relating to the Assets (but which were not included among the Assets) as may reasonably be requested from time to time by Purchaser, including any information requested in connection with the preparation or audit of Purchaser’s federal, state and local income and other Tax Returns, including disputes, refund claims or litigation relating thereto, and any other third Person litigation or investigation, if any. In such connection, Seller will afford the Purchaser’s representatives, including independent advisers and others, reasonable access to inspect books and records regarding or relating to the Assets during regular business hours and upon at least two (2) weeks’ prior written notice. As used in this Section 5.6, this right of inspection shall include the right to make extracts or copies at Purchaser’s expense..

5.7   Payment of Liabilities. Following the Closing, Seller shall pay or otherwise satisfy and discharge, in the ordinary course of business, all Liabilities, including any delinquent Tax Liabilities, relating to the Assets incurred through the Closing Date, to the extent the failure to do so would adversely impact the Purchaser or the Assets. In the event any of Seller’s payables to creditors and/or Tax Authorities are not so paid and Purchaser subsequently satisfies such payables, Purchaser may offset its payments in accordance with Section 9.6.

5.8   Mail. Purchaser, on the one hand, and Seller, on the other hand, each agree to promptly deliver to the other the original of any mail or other communication received by such party after the Closing Date that should properly be the property of the other. Purchaser, on the one hand, and Seller, on the other hand, each further agree from and after the Closing Date to promptly deliver to the other any monies, checks or other instruments of payment to which the other party is entitled hereunder, together with a reasonable accounting therefor.

5.9   Change of Name. On the Closing Date, Seller shall execute and, promptly thereafter, file with the Secretary of State of New Jersey such documents and resolutions as are necessary to change Seller’s name to another name that is not deceptively similar to any name used by Seller prior to the Closing Date and, upon receipt of a certified copy of an Amendment to Seller’s Certificate of Incorporation reflecting the name change, Seller shall promptly deliver to Purchaser a copy of the certified Amendment to Seller’s Certificate of Incorporation. Further, Seller shall, within five (5) days following the Closing, execute and file with the Secretary of State of New Jersey and such other