Common use of Acquisition of Perpetual Trademark License Clause in Contracts

Acquisition of Perpetual Trademark License. (a) If the Infringed Party has been affected at least three times by admitted or confirmed facilitation of Material Diversion by the same Accused Party of the same product in the jurisdiction(s) described in Schedule M hereto within ten years (“Repeated Diversion”), the Infringed Party shall have the option, in lieu of liquidated damages under Section 4.7(b)(iii)(1), to terminate the Applicable Trademark License (as defined in Schedule M hereto) (the “Buy-Back Option”) upon (i) provision of written notice (the “Buy-Back Notice”) to such Accused Party and to the Licensee under the Applicable Trademark License (the “Applicable Licensee”) and (ii) payment to the Applicable Licensee (the “Buy-Back Payment”) of an amount equal to six (6) times Adjusted EBITDA for the relevant business conducted under the Applicable Trademark Licenses (the “Relevant Business”). The foregoing (i) and (ii) shall be deemed the “Buy-Back”. At a minimum the assets to be transferred as part of the Relevant Business will include, to the extent related to the products in the territories subject to the Applicable Trademark License and requested by the Infringed Party in its discretion: (i) Trademark rights to brand(s) (e.g., Tang or Jell-O & Kool-Aid) and all exclusively related Sub-Brands and Trade Dress; (ii) Rights to any brand-specific web domains or social media accounts or addresses (facebook, twitter accounts, etc.); (iii) Rights (on a non-exclusive basis if shared with other brands) to any patents and trade secrets (including recipes and formulas) specifically related to the brand(s) (iv) Rights to any GroceryCo Brand-Related Copyrights or SnackCo Brand-Related Copyrights, as the case may be, specifically related to the brands; (v) Any brand-specific manufacturing equipment (dedicated production or packaging lines, molds, tooling, etc.), as desired by the Infringed Party; (vi) Existing finished product and packaging inventories, which should equal no less than the average inventory for the twelve (12) month period immediately preceding the effective date of the Buy-Back; (vii) A license to use the other party’s Trademarks, Sub-Brands and Trade Dress utilized on existing inventory for up to twelve (12) months following the effective date of the Buy-Back; (viii) Customer lists with SKU-level pricing, trade spending details and volumes by customer and customer contact details; (ix) All marketing materials related exclusively to the Related Business, including advertising, promotional, and sales and training materials; (x) Assignment of any contracts related to sub-licensing of Trademarks or any product-related governmental permits; (xi) Assignment of all marketing, sales, distribution, and other agreements exclusively related to the Related Business; and (xii) Transitional services as reasonably needed by the Infringed Party for up to six (6) months after the effective date of the Buy-Back at fully allocated costs plus a 6% markup. For the avoidance of doubt, the assets and liabilities subject to the Buy-Back Option will not include any cash, debt, payables, or receivables. (b) Within thirty (30) Business Days of receipt of a Buy-Back Notice, the Applicable Licensee shall deliver to the Infringed Party a written statement calculating Adjusted EBITDA and the amount of the Buy-Back Payment (the “AEBITDA Statement”) together with the most recent annual and interim financial statements for the Relevant Business. The Applicable Licensee (i) shall make reasonably available to the Infringed Party upon reasonable advance notice prior to the Infringed Party’s acceptance of the AEBITDA Statement any additional financial statements and any work papers that were used by the Applicable Licensee in preparation of the AEBITDA Statement and (ii) shall respond promptly to the Infringed Party’s requests for additional information with respect to the Adjusted EBITDA calculation. The AEBITDA Statement shall not be binding upon the Infringed Party if the Infringed Party timely exercises its right to dispute the AEBITDA Statement in accordance with the procedures set forth in Section 4.8(c) below. (c) If the Infringed Party objects to an AEBITDA Statement, the Infringed Party shall deliver a statement of objection (including reasonable details of such objection) to the Applicable Licensee within fifteen (15) Business Days after receiving such AEBITDA Statement. The Infringed Party and the Applicable Licensee shall use reasonable efforts to promptly resolve any objection. If the Infringed Party and the Applicable Licensee do not obtain a final resolution within fifteen (15) Business Days after the Applicable Licensee has received the Infringed Party’s statement of objections, the Infringed Party and the Applicable Licensee shall select a mutually acceptable independent public accountant that is working on an hourly or flat fee basis and does not receive a contingency fee or other bounty or bonus fee. Such accountant shall be instructed to determine the final amount of the Buy-Back Payment within twenty (20) Business Days of the date of its appointment. The Applicable Licensee shall revise the AEBITDA Statement if necessary and as appropriate to reflect the resolution of any objections thereto, if any, pursuant to this Section 4.8(c). The determination of such accountant shall be set forth in writing and shall be conclusive and binding upon the Infringed Party and the Applicable Licensee. The fees and expenses of such accountant shall be borne equally by the Applicable Licensee and the Infringed Party. (d) Following election of the Buy-Back Option and termination of the Applicable Trademark Licenses, the Applicable Licensee shall use its reasonable best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, all things, reasonably necessary, proper or advisable to consummate and make effective the Buy-Back Option. (e) Notwithstanding the foregoing, the Buy-Back Option shall not extend to the “MiO” GroceryCo Xxxx.