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EXHIBIT 10.1
AMENDED AND RESTATED
TRADEMARK LICENSE AGREEMENT
This Agreement is made and entered into as of March 27, 2001, by and
between XXXXXXXX XXXXXXXXX, INC. ("Hallmark") and ODYSSEY HOLDINGS, L.L.C.
("Odyssey").
WHEREAS, Hallmark and Odyssey have previously entered into a Trademark
License Agreement dated as of May 1, 2000 ("Previous Trademark Agreement")
whereby Hallmark licensed to Odyssey certain rights to use the trademarks
"Hallmark Entertainment" and "Hallmark Hall of Fame" in the United States; and
WHEREAS, Hallmark is the owner of the trademarks "Hallmark
Entertainment," "Hallmark Hall of Fame" and "Hallmark" in the United States; and
WHEREAS, Odyssey desires to use the trademarks "Hallmark Entertainment"
and "Hallmark" and associated logos designated by Hallmark (the "Hallmark
Marks") and the trademark "Hallmark Hall of Fame" (the "Hall of Fame Xxxx")
(collectively the "Hallmark Marks" and the "Hall of Fame Xxxx" shall be the
"Licensed Marks") subject to the terms and conditions specified herein; and
WHEREAS, Hallmark desires to permit Odyssey to use the Licensed Marks
subject to the terms and conditions herein provided, and not otherwise.
NOW THEREFORE, in consideration of the promises and mutual covenants
herein contained, the parties hereto hereby amend and restate the Previous
Agreement in its entirety as follows:
1. Grant. To the extent of its present and future ownership interest
therein, and subject to the terms and conditions of this Agreement, Hallmark
hereby grants to Odyssey the rights below listed for the term of this Agreement,
but only for so long as Odyssey is a subsidiary of Crown Media Holdings, Inc.
and Hallmark and/or its wholly owned subsidiaries collectively beneficially own
at least 51% of the voting interest and 35% of the equity interest of Crown
Media Holdings, Inc. and designate a majority of the Board of Directors of Crown
Media Holdings, Inc. and no event of Default has occurred hereunder:
a. The non-exclusive, royalty-free license to use the Hallmark
Marks in connection with the promotion, marketing,
advertising, distribution and sale of Odyssey's Service (as
defined in Section 3), in the United States.
b. The non-exclusive, royalty free license to use the Hall of
Fame Xxxx in the United States solely in connection with the
program title "THE COLLECTION - from the library of the
Hallmark Hall of Fame" or such other title as may be approved
by Hallmark from time to time for a period regularly showing
pictures previously broadcast as Hallmark Hall of Fames.
2. Limitations. Odyssey agrees not to use the Licensed Marks in its
corporate name.
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3. The Service. The "Service" shall mean the distribution of a channel
(or network presenting a channel) of high-quality, family oriented television
programming of a character, nature and quality consistent with the image of
Hallmark Cards, Incorporated.
4. Standards.
a. Odyssey acknowledges its familiarity with the high
standards of quality and guidelines maintained by Hallmark for
the use of the Licensed Marks and the name "Hallmark," and
Odyssey agrees to faithfully maintain these same standards in
connection with its programming of the Service, including but
not limited to complying with the broadcast standards set
forth on Schedule A, as amended by Hallmark from time to time.
Furthermore, Odyssey agrees to comply with any guidelines or
rules for use of the Licensed Marks as Hallmark may in its
sole discretion, from time to time, promulgate in order to
protect the quality image and reputation which the Licensed
Marks and the name "Hallmark" presently enjoy and such
guidelines or rules shall be incorporated herein as a part of
this Agreement.
Odyssey also acknowledges that religious programming from VISN
Management Corp. ("NICC") shall not exceed the following:
(i) A seven hour programming block from 6:00 a.m. to
1:00 p.m. on Sundays which may include up to three
hours of worship services prior to noon.
(ii) A NICC produced half hour program airing at either
6:30 or 7:00 a.m. Monday through Friday not
including any worship service.
(iii) A one hour program co-produced with Odyssey to be
aired between 8:00 a.m. and 1:00 p.m. Monday through
Friday.
(iv) Up to six NICC specials in primetime during holiday
seasons. If the specials are non-dramatic in nature
NICC will meaningfully consult with Odyssey about
content. If the specials are dramatic, e.g. a
Christmas or Easter movie, Odyssey will co-produce
the specials.
b. Odyssey acknowledges that Hallmark Cards was founded in
1910, is a privately owned company which enjoys a stellar
reputation for excellence, quality, adherence to high ethical
and moral values, and whose brand "Hallmark" consistently
rates in the top ten brands in the U.S. for consumer
recognition, consumer trust and quality. Further, "Hallmark
Hall of Fame" productions have won 78 Emmys over the past 40
years. Odyssey further acknowledges that Hallmark would not
grant this trademark license if it did not control Odyssey and
Hallmark's wholly owned subsidiaries, Hallmark Entertainment,
Inc., Hallmark Entertainment Productions, LLC and Hallmark
Entertainment Distribution, LLC, which produce pictures
distributed on the Service.
c. Odyssey agrees to designate an individual at Odyssey's
expense who will be responsible for monitoring the use of the
Licensed Marks and ensuring that the Licensed Marks are
utilized in accordance with this Agreement and that all
required requests for approval are properly submitted to
Hallmark.
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5. Approval. Odyssey agrees to comply with the brand identity standards
of the branding committee established by Hallmark ("Branding Committee") which
standards shall include, but not be limited to, logo, program headers,
visual/verbal standards, uses and positioning of logo, application of logo to
any marketing materials, uses by any MSOs, uses in other media such as print
advertising. Further, Odyssey agrees that programming shall comply with the
broadcast standards on Schedule A as amended by Hallmark from time to time.
Odyssey shall submit to Hallmark periodically at Hallmark's request, the program
schedule for its Service at least 30 days in advance for Hallmark's prior
written approval. Odyssey shall also submit to Hallmark all proposed press
releases referring to the Hallmark channel (other than advertising for shows and
announcements of personnel changes), prototypes of advertising, promotional
materials and other marketing materials for Hallmark's prior written approval as
to format and content. After guidelines are approved by Hallmark, Odyssey will
thereafter submit only such matters that reflect a change in direction or as
requested by Hallmark. Additionally, Odyssey shall, at the request of Hallmark,
submit to Hallmark pictures, programs, film credits and other materials
utilizing the Licensed Marks or broadcast on the Service for Hallmark's
approval, which may be withheld for any reason. Submissions shall be directed to
the attention of Xxx Xxxxxx, or such other person designated by Hallmark from
time to time.
6. Trademark Protection.
a. Hallmark will use its reasonable efforts to maintain
existing registrations for the Licensed Marks for use by
Odyssey pursuant to the terms and conditions herein contained.
b. Odyssey agrees to cooperate with Hallmark in obtaining and
preserving for Hallmark trademark protection for the Licensed
Marks and the name "Hallmark," to execute all documents which
in Hallmark's judgment are necessary therefor, and to give
Hallmark advance notice of all contemplated uses of the
Licensed Marks. Odyssey agrees to recognize Hallmark's
trademark rights in the Licensed Marks and to do nothing in
derogation or dilution thereof, either during the term of this
Agreement or at any time thereafter. Odyssey, for itself, its
successors and assigns, does hereby absolutely grant, convey,
and assign to Hallmark any and all legal and equitable right,
title and interest, both tangible and intangible, which it has
or may hereafter acquire in the Licensed Marks, including, but
not limited to, any goodwill hereinafter generated or created
by it or anyone acting or claiming under it.
c. Odyssey, upon prior written approval from Hallmark, shall
have the right to enforce, at Odyssey's sole expense, its
rights in the Licensed Marks granted hereunder against third
parties that are or may be infringing the Licensed Marks so as
to affect Odyssey's rights granted hereunder.
d. Except as expressly set forth herein, Hallmark shall have
the right to take any action without regard to the effect of
such action on the rights granted in Section 1 hereof.
7. Term. The term of this Agreement shall begin on the date hereof and
expire on August 30, 2003, provided that it is not terminated sooner in
accordance with the terms and conditions set forth herein. No course of dealing,
lack of notice of intent not to renew, implied consent or other doctrine of law
or equity shall be deemed to give Odyssey the right to continued use of the
Licensed Marks beyond
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the stated term of this Agreement, or to create any duty (fiduciary or
otherwise) on Hallmark to permit any such use beyond the term of this Agreement.
8. Default. It shall be a Default hereunder in the case of the
happening and during the continuance of any of the following:
a. Odyssey distributes any program or picture in connection
with the Service which in Hallmark's sole discretion fails to
comply with the standards set forth in Section 4 hereof and
Odyssey fails to remove and stop the distribution, exhibition
and broadcast of such non-complying program or picture within
10 days of written notice from Hallmark;
b. A Default occurs pursuant to Section 8(a) hereof three or
more times in any given 12 month period, regardless of whether
Odyssey has removed or stopped within 10 days of written
notice from Hallmark.
c. Odyssey uses any of the Licensed Marks other than in
accordance with the terms of the grant herein or Odyssey fails
to comply with any term or obligation of this Agreement (other
than 8(a) above) and, if curable, fails to cure such
unapproved use or breach within 10 days of the date of written
notice from Hallmark specifying such breach.
d. Odyssey fails to make any payment when due under any loan
agreement with any financial institution and fails to make
such payment within 5 days thereafter.
e. Auditors determine that Odyssey is no longer an ongoing
concern.
f. An event occurs which with the passage of time or the
giving of notice, or both, would constitute an event of
default by Crown Media International, Inc. pursuant to the
terms of its Amended and Restated Trademark License Agreement
with Hallmark Cards, Incorporated dated as of December 1,
2000, as the same may be amended from time to time.
9. Termination.
a. This Agreement shall terminate immediately and
automatically without notice in the event that
i. Odyssey attempts to assign, sublicense, pledge, transfer or
otherwise convey by operation of law or otherwise, all or any interest in,
directly or indirectly ("Transfer") its rights hereunder;
ii. Odyssey is adjudicated bankrupt, becomes
insolvent, makes any assignment for the benefit of its creditors, has its assets
placed in the hands of a receiver, files a petition in bankruptcy, has filed
against it a petition in bankruptcy which is not discharged within 60 days after
its filing, or is dissolved or liquidated (in which case, Odyssey, its
receivers, representatives, trustees, agents, or successors shall have no right
to exploit or in any way utilize the Licensed Marks).
b. This Agreement shall terminate immediately upon the
occurrence of an event of Default pursuant to Section 8
hereof.
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c. Upon the termination or expiration of this Agreement,
Odyssey agrees to immediately and permanently discontinue the
use of the Licensed Marks, including any adaptations thereof
except that in the case of Section 9(b) above, such use shall
cease only in such country.
d. Odyssey hereby acknowledges that its misuse of the Licensed
Marks or failure to cease the use of the Licensed Marks upon
the termination or expiration of such rights or this Agreement
will result in damage to Hallmark for which there is no
adequate remedy at law. Accordingly, in the event of such
misuse or failure, Hallmark shall be entitled to equitable
relief by way of temporary and permanent injunctions and such
other relief as any court of competent jurisdiction may deem
just and proper.
10. Additional Agreement. Odyssey hereby agrees that Hallmark and its
affiliates shall not have any liability or obligation to Odyssey on account of
the exercise of any of Hallmark's rights or remedies hereunder. Odyssey hereby
waives and releases any right to commence or pursue any legal action (whether
suit, counterclaim, cross claim or other action) against Hallmark or any of its
affiliates challenging the termination by Hallmark of the trademark license
granted herein based on a theory of breach of fiduciary obligation or conflicts
of interest of Hallmark or any of its affiliates or similar theories or premised
on the exercise of control or influence over management by Hallmark or its
affiliates.
11. Third Party Infringement. Odyssey shall promptly notify Hallmark of
any apparent infringement of any rights granted by Hallmark to Odyssey
hereunder. Hallmark shall have the exclusive right to institute legal action (at
its own expense) against the infringer or to otherwise terminate such
infringement. Odyssey shall have no right to make any demands or claims, bring
suit, effect any settlements or take any other action with respect to such an
infringement without the prior written consent of Hallmark. Odyssey agrees to
cooperate at its cost with Hallmark with respect to any suits or other action
taken under this paragraph and that all recoveries for such infringements shall
belong to Hallmark. Hallmark may name Odyssey as a party to any suit against
third party infringers if Hallmark, in its sole opinion, determines that it is
desirable to any infringement suit.
12. Nonassignability. Odyssey agrees that without the prior written
consent of Hallmark it may not transfer the rights granted hereunder or permit
any third party to utilize the Licensed Marks (e.g. as a channel name) other
than third party use incidental to Odyssey's use described in Section 1(b)
hereof and any such transfer shall be null and void upon such proposed transfer.
13. Applicable Law. The validity, construction and performance of this
Agreement shall be governed by, and interpreted in accordance with, the laws of
the State of Missouri. In any dispute relating to this Agreement, the parties
hereto submit themselves to the exclusive jurisdiction of the tribunals of the
State of Missouri and the United States Courts within the State of Missouri,
expressly waiving any venue to which they may be entitled by their present or
future domiciles and any objection based on forum non conveniens.
14. No Agency. Nothing in this Agreement shall be construed to make
either party hereto the agent or representative of the other party and neither
party shall so hold itself out nor shall either party be liable or be bound by
any act or omission of the other party.
15. Waiver. Failure of either party at any time to require the
performance of any provision under this Agreement shall not affect the right of
such party to require full performance thereafter and a
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waiver by either party of a breach of any provision of this Agreement shall not
be taken or held to be a waiver of any further or similar breach or as
nullifying the effectiveness of such provision.
16. Amendments. This Agreement expresses the entire understanding of
the parties hereto and replaces any prior oral or written agreements concerning
the subject matter hereof and Licensee acknowledges that it has not executed
this Agreement in reliance upon any promise, agreement, representation or
warranty not expressly set forth in this Agreement. No amendment modification,
or supplementation hereof shall be effective or binding on either party hereto
unless reduced to writing and executed by the duly authorized representatives of
both parties hereto.
17. Security Interest. Odyssey hereby acknowledges the difficulty of
determining the amount of any damage arising from Odyssey's use of the Licensed
Marks other than in accordance with the grant in this Agreement, particularly
inasmuch as no payment or royalty is required for the license granted herein.
Therefore, to secure Odyssey's performance pursuant to this Agreement and
compensation for any damage to Hallmark's name or reputation due to a breach of
this Agreement, the parties have entered into that Security Agreement dated as
of the date hereof between the parties and Odyssey hereby ratifies Hallmark's
first and prior lien and security interest in and to all of Odyssey's right and
interest in and to this Agreement pursuant to such security agreement.
IN WITNESS WHEREOF, this Agreement is executed as of the date first
written above.
XXXXXXXX XXXXXXXXX, INC.
By /s/ Xxxxxx Xxxxxxxxx
------------------------
XXXXXX XXXXXXXXX
Title Vice President
ODYSSEY HOLDINGS, L.L.C.
By /s/ Xxxxxxxx X. Xxxxxx
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XXXXXXXX X. XXXXXX
Title President and Chief Executive Officer
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SCHEDULE A
GUIDELINES FOR ODYSSEY PROGRAMMING
This section sets forth a summary of Broadcast Standards and Practices policies
with which all entertainment programming produced for telecast on the Odyssey
Service must conform. Programs must meet appropriate standards of taste and
comply with all applicable governmental regulations.
A. PURPOSE OF ODYSSEY PROGRAMMING
The purpose of Odyssey's programming is to provide families with positive
meaningful experiences through high quality entertainment that celebrates the
human spirit and caring relationships. The programming should strive to
reinforce positive social values, educate and inspire.
B. SPECIFIC ISSUES
1. DRUGS AND ALCOHOL
Drug and alcohol abuse are among society's most serious social problems. Odyssey
has a duty to ensure that any depiction of drug or alcohol consumption is
presented in an appropriate and responsible manner.
All portrayals of alcohol consumption and/or use of legal or illegal drugs
should be restricted to situations necessary to plot and/or character
delineation. The use of illegal drugs and/or the abuse of legal drugs or alcohol
is destructive behavior and shall not be shown as desirable, beneficial or as an
effective problem-solver.
Drug and alcohol use should not be glamorized and, when substance abuse is
noted, attention should be directed to the adverse consequences of such abuse
(e.g. the dangers of driving while intoxicated).
2. LANGUAGE
Language and dialogue must be judged generally acceptable to a mass audience and
appropriate to a public medium. Coarse or vulgar language should be avoided.
Blasphemy and obscenity are unacceptable.
3. SEXUAL MATERIAL
Sexual scenes must be sensitively handled and contribute to plot or
characterization. Gratuitous or overly explicate sexual action is unacceptable
and the depiction of physical coercion intended to satisfy prurient interests is
to be avoided. The depiction of the act of sexual intercourse is prohibited.
Particular care must be taken in scenes where sex is coupled with violence. Rape
must be portrayed as an act of violence, not a sexual act.
In general, nudity is unacceptable. Partial nudity and degrees of undress shall
not be used for prurient or exploitative purposes.
4. STEREOTYPES
Characters in Odyssey programs should reflect the wide diversity of our
audience, keeping in mind the importance of dignity to every human being.
Sensitivity is necessary in the presentation of material relating to age, sex,
race, religion, sexual orientation, ethnicity or national derivation to avoid
demeaning stereotypes.
Special precautions must be taken to avoid portrayals and terminology which
ridicule or patronize those who are physically or mentally disabled.
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5. VIOLENCE
Explicit, excessive gratuitous violence is to be avoided. Programs are not to
glamorize violence and/or promote violence as the solution to problems.
Depictions of violence in any form must be essential to the development of
theme, plot or characterization. The intensity and frequency of violent acts
must be limited.
Exceptional care must be taken where children are victims of, or are threatened
by acts of violence.
C. GENERAL ISSUES
ANIMALS
The use and handling of animals must conform to accepted standards of humane
treatment.
CHARITIES
Solicitations within the body of an entertainment program for charities or other
non-profit organizations are generally not permitted.
COMMERCIAL MENTIONS/SPONSOR REFERENCES
Extraneous commercial mentions or exposure of commercial names, products or
trademarks included in program content are to be minimized and are subject to
prior approval by identification of, or references to, a program's sponsor other
than previously accepted commercial announcements, billboards, and program
titles must be specifically approved in advance by the Hallmark Branding
Committee.
CONTROVERSIAL TOPICS
Issues of social importance or controversy must be handled with care. A decision
to present such subject matter in an entertainment program should include a
determination that the particular program involved is appropriate for the
presentation contemplated.
HYPNOSIS
Actual hypnosis techniques may not be demonstrated in detail.
INSTRUCTIONAL CRIMINAL BEHAVIOR
Scenes containing complete and accurate instructions in the use of illegal
drugs, harmful devices or weapons, or describing imitable techniques for other
illegal activities or evasion of apprehension are not permitted.
MISLEADING DRAMATIZATIONS, SIMULATIONS AND RECREATIONS
Odyssey programs may not be deceptive to the viewing public in any material
respect. In cases where the audience might be misled, appropriate disclaimers
are to be used. Programming purporting to present non-fictional material in a
non-fictional manner must be accurate with respect to material facts or
statements.
The use of techniques or language such as "we interrupt this program" which may
cause viewers to believe an actual news report is being presented is not
permitted.
PROFESSIONAL PROCEDURES
Dramatization or actual presentation of professional advice and procedures must
be accurate and comply with recognized professional practices.
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PROMOTIONAL ELEMENTS
Promotional elements such as "teasers" and "trailers," including "promos," must
properly reflect the actual nature and content of the program. Certain material
acceptable in the context of the program may not be appropriate for inclusion in
promotional elements.
PSEUDO-SCIENCES
Program material should not promote belief in the efficacy of occultism,
astrology, mind-reading or other pseudo-sciences.
SUBLIMINAL MESSAGES
Audio and video content which is inserted within the body of a program which
attempts to convey information below the level of normal viewer awareness is
prohibited.
D. SPECIALIZED PROGRAM TYPES
1. PROGRAMS INTENDED TO BE VIEWED PRIMARILY BY CHILDREN
Odyssey must be sensitive to the special needs of young people. Odyssey should
present educational and pro-social materials and require that producers avoid
program content that would have an adverse effect on a child's behavior or
development. Acknowledging the audiences' expectation that children's programs
will provide young viewers with a positive entertainment experience, producers
of children's programs should not only observe the general standards guidelines
contained herein, but should be particularly careful with respect to the
following:
a. Characters should not be placed in situations that would provoke
excessive or prolonged anxiety in children. Catastrophe and jeopardy
should not be extreme as to frighten younger viewers. References to
death and/or suicide should be handled with extreme caution.
b. Characters should reflect the ethnic and racial diversity of
Odyssey's audience. It is encouraged that women, minorities, disabled
persons and distinctive characters with whom viewers would personally
identify (e.g. kids who wear glasses) should be included, but,
derogatory stereotypes should be avoided.
c. Violence should not be depicted as glamorous or shown as an
acceptable solution to problems. The negative consequences of violence
should be stressed. To mitigate violence, action sequences should
emphasize unrealistic settings, fantasy weapons, and superhuman feats.
d. Dangerous behavior which could prompt a child to place himself or
others in jeopardy should not be shown. Special care should be taken
with respect to depicting fire-making techniques or use of electrical
devices, especially when such materials are readily available in the
viewer's home. Depicting household items as weapons must also be
avoided.
e. Characters should not engage in unlawful, anti-social or
self-destructive behavior without suffering negative consequences for
their actions. Whenever possible, protagonists should be shown
following generally accepted rules of safety (e.g. wearing seatbelts).
f. Romantic storylines which include acts of affection are generally
considered appropriate but should be handled with discretion. Language
and storylines that are sexual in nature should be avoided.
g. Commercial products and references may only be included in programs
with Odyssey's approval and must serve a valid entertainment purpose.
h. Children's programs are generally required to have Separator Devices
before and after commercial messages.
2. FACT-BASED PROGRAMS
There shall be no broadcast of any deceptive or misleading programs or program
material. Fact-based dramas and presentation must be reviewed for accuracy and
producers must provide substantiation when deemed necessary.
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3. THEATRICAL FILMS
Theatrical or other programs originally produced for another medium must be
reviewed before broadcast and shall comply with all Odyssey Broadcast Standards
and Practices.
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