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EXHIBIT 10.153
AGREEMENT
THIS AGREEMENT made as of the 1st day of December, 1991 by and among
XXX XXXXXX, LTD., a New York Corporation, with offices in New Jersey and a
mailing address of Xxxxx Xxxxxx Xxxxxxxxx, Xxxxxxxxx, Xxx Xxxxxx 00000
(interchangeably "Licensor" or "TFL"), which is a wholly owned subsidiary of MEM
Company, Inc.; and RED BOX TOY FACTORY LTD., a Hong Kong corporation with
offices at 1216 Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx Xxxx, Xxxxxxx, Xxxx Xxxx
(interchangeably "Licensee" or "Red Box HK"),
WITNESSETH:
WHEREAS, TFL is the owner of the trademark "TINKERBELL" for numerous
products of interest to young girls; and
WHEREAS, Red Box HK is capable of manufacturing or causing to be
manufactured many toys of interest to children including vanity cases for young
girls; and
WHEREAS, TFL is willing to license its trademarks to Red Box HK for use
on and in connection with the sale of fashion beauty kits as well as the
numerous other items specified herein;
NOW, THEREFORE, in consideration of the covenants of each
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of the parties hereto to each other party the receipt and sufficiency of which
are hereby acknowledged, TFL and Red Box HK agree as follows:
1. Sale of Red Box Vanity Cases By TFL.
Should any sales representative of TFL secure an order from a customer
against that customer's letter of credit in Hong Kong payable to Red Box HK
against delivery by Red Box HK to that customer's freight forwarder in Hong
Kong, Red Box HK will pay TFL, five percent (5%) of its Net Sales to that
customer.
2. Definitions
(a) The term "Affiliated Business Organizations", "Affiliated Company"
or "Affiliates" will mean any person, corporation, or other legal organization
that directly or indirectly, through one or more intermediaries, controls or is
controlled by or is under common control with the company named.
(b) The terms "Claim" or "Claims" will comprehend any means employed by
anyone, whether in or out of court, to obtain legal (e.g. monetary ) or
equitable (e.g. injunctive) relief from Licensor.
(c) The term "Contract Quarter" will mean any of the successive three
(3) month periods next following and including the first Contract Quarter which
will begin on December 1, 1991 and end on February 29, 1992.
(d) The term "Contract Year" will mean each successive yearlong period
this agreement is in force beginning with the period December 1, 1991 - November
30, 1992 (e.g. the fourth
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Contract Year would be the period December 1, 1994 - November 30, 1995).
(e) The term "Control" (including the terms "Controlling", "Controlled
By" and "Under Common Control With"), as used herein will mean possessing,
directly or indirectly, the power to direct or cause the direction of the
management and policies of any person, firm or corporation, whether through
ownership of voting securities, by contract or otherwise.
(f) The term "Costs" will mean any money expended by Licensor on
account of a Claim, whether for damages, reasonable legal fees, litigation
expenses or otherwise.
(g) The term "Due Date" will mean the last business day of the month
next following any Calendar Quarter.
(h) The "Effective Date" is the date first above written.
(i) The term "License" will mean the exclusive and non-transferable
license to use the Trademarks in relation to the Products (and not to any other
products) within the Territory.
(j) The term "Net Sales" will mean the amount of money charged and
billed by Licensee to Unrelated Customers purchasing the Products ("Standard
Charges") after deducting (i) actual trade discounts (unless deducted before
calculating Standard Charges), (ii) returns, (iii) taxes (shown on Licensee's
invoices and payable by purchasers), and (iv) transportation and postage charges
(to the extent prepaid by the Licensee and billed on its invoices as a separate
item). It is understood, however, that the following
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items may not be deducted from Standard Charges in calculating Net Sales: (aa)
cash discounts, (bb) advertising allowances, or (cc) promotional allowances.
(k) The term "Products" will mean the items on Schedule A annexed
hereto and made a part hereof. It is understood that TFL and Red Box HK may wish
to license and manufacture, respectively, certain other products for sale in
1993. These include musical jewelry boxes, hand bags, stationery sets, tea sets,
toy jewelry, lap trays and dress-up sets. Upon written notice, and absent its
objection within 10 business days of receipt of such notice, to TFL, Red Box may
add these items to Schedule A as of December 1, 1992. If it objects, TFL must do
so in writing and the items it objects to will not be incorporated in Schedule
A.
(l) The term "Territory" will mean the United States of America.
(m) The term "Trademarks" will mean:
(i) the registered trademark "TINKERBELL", and
(ii) the registered design frequently accompanying the
trademark "TINKERBELL".
(n) The term "Unrelated Customers" means all customers purchasing the
Products which are not Affiliated Business Organizations.
3. Representation by Licensee
(a) Red Box HK represents to the Licensor that the present financial
structure and present facilities are such that they are now, and will be
throughout the term of this Agreement, in
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a favorable position to manufacture, distribute, advertise and sell the Products
within the Territory under the license hereinafter granted with respect to the
Trademarks.
(b) Red Box HK represents to Licensor that no Affiliated Business
Organization of it is a competitor of Licensor.
(c) Red Box HK represents that it will not sell or sponsor the sale of
a line of toiletries and cosmetics in the Territory which is competitive with
any line of TFL's.
4. Grant of License to Use of the Trademark
(a) Licensor hereby grants to Licensee during the term of this
agreement, and subject to its terms and conditions as hereinafter set forth, the
License.
(b) Licensee's policy (in using the Trademarks) of sale, distribution
and use will not reflect adversely upon Licensor's Trademarks. For example,
Licensee will only sell to organizations having established outlets so as to
exclude sales to flea markets and sidewalk vendors. Licensee will provide, on an
annual basis , to Licensor, a customer list of those organizations purchasing or
otherwise receiving Products from Licensee with the net volume shown for each
customer. This customer list will be held by Licensor under the same terms and
conditions of confidentiality as set forth in paragraph 9(g) of this agreement.
(c) If the Products are not brought to market within the Territory
within twelve months of the Effective Date, the Licensor may terminate the
License by sending written notice to the
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Licensee, effective upon receipt.
(d) Prior to any use by the Licensee of the Trademarks it must submit
to the Licensor for its approval, designs, materials, packages, labels,
promotional materials and advertising by means of which it intends to market,
sell or distribute any and all Products on which the Trademarks appear. Upon
receipt, Licensor will review same. If Licensor makes no written comments
containing reasonable objections within 15 business days of such receipt, then
Licensee may deem all such submitted material approved. Licensee will amend to
the satisfaction of Licensor any such materials which are not approved by
Licensor.
(e) In conjunction with each and every use of the Trademarks, Licensee
will cause to appear adjacent to it, appropriate statutory notice of
registration or application for registration ((R) or TM as the case may be).
Licensee will also cause to appear on or within all advertising, promotional
display, or other printed material bearing the Trademark, the following or a
notice to the same effect: "TINKERBELL" is a registered trademark of Xxx Xxxxxx,
Ltd., Northvale, New Jersey, and is being used under a license from Xxx Xxxxxx,
Ltd.".
(f) Licensee hereby indemnifies and holds Licensor harmless from any
Costs and undertakes to defend Licensor against any Claims arising out of the
activities of Licensee under the License (including but not limited to the
manufacture, use, marketing, sale, and distribution of the Products)
attributable to alleged defects in the Products.
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5. Preparation by Licensee
(a) Licensee is an independent contractor and will, at its own expense,
adapt such of its facilities, purchase such raw materials, hire such personnel,
arrange for such transportation and delivery, as are necessary to commence the
manufacture and sale of the Products. Licensee will at its sole expense, comply
with all Federal, State and local laws and regulations relating to the
manufacture and sale of the Products, including, but not limited to, all
labeling requirements.
(b) Licensee will maintain, at its sole expense, products liability
insurance covering both Licensor and Licensee for bodily injury and property
damage liability in at least the Combined Single Limit of U.S. $1,000,000.00.
Licensee will deliver to Licensor, promptly after execution of this agreement, a
certificate issued by a nationally reputable insurance company evidencing such
coverage and providing that such insurance may not be canceled, except on thirty
(30) days written notice to Licensor and Licensee. If Licensee fails to maintain
such insurance, Licensor may obtain it and charge the cost thereof to Licensee
or may treat such failure as a breach of material provisions of this agreement.
6. Inspection
(a) Licensee will at all times permit Licensor, by representatives
designated by Licensor, to inspect the design and manufacture of the Products
manufactured by Licensee for sale by it under the Trademarks. At all times,
Licensee will comply with
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the reasonable quality control procedures furnished or approved, from time to
time, in writing by Licensor.
(b) Licensee will submit to Licensor three (3) specimens of each of the
Products prior to its being offered for sale. Licensor will review each such
item and indicate its approval or disapproval with comments. If the Licensor
fails to comment within 15 business days of receipt of a specimen, the Product
represented by the specimen will be deemed to have been approved. In addition,
the Licensor may, from time to time, request samples of the Products.
7. Title to the Trademarks
(a) Licensee recognizes Licensor's title to the Trademarks and the good
will associated with them and their importance to Licensor, and will not at any
time do or suffer to be done any act or thing which will in any way impair the
rights of Licensor in and to the Trademarks. It is understood that Licensee will
not acquire nor will it claim title to the Trademarks by virtue of the license
granted to Licensee herein, or Licensee's use of the Trademarks.
(b) In the event any infringement of the rights of Licensor to any of
the Trademarks in the Territory comes to the notice of Licensee during the term
of this agreement, Licensee will promptly notify Licensor, in writing, and will
join with Licensor, upon Licensor's written request and at Licensor's expense in
taking such steps, if any, as Licensor deems advisable to protect its rights.
Licensee will take no action independent of
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Licensor without the express written consent of Licensor.
(c) During the term of this agreement, the Licensor will maintain the
registration of the Trademarks in the Territory, in full force and effect, free
and clear of any and all cancellation petitions, interferences or objections.
8. Royalties
(a) Licensee will pay to Licensor a royalty of five (5%) percent of
Licensee's Net Sales.
(b) Products will be deemed to have been sold on the earliest of the
following dates: (i) when invoiced, (ii) when delivered, shipped or mailed or
(iii) when payment has been received.
(c) Licensee will maintain itemized, complete and accurate books of
account with respect to all Products sold under this agreement.
(d) Licensee will render to Licensor an accounting, certified by a
financial officer of Licensee, specifying exactly how royalties were computed
including how Net Sales were calculated (i.e. by enumerating all deductions
used). This accounting must be rendered on or before each Due Date.
(e) On or before each Due Date, Licensee will pay Licensor all
royalties owed from sales during the previous Contract Quarter.
(f) In the event Licensee fails to make any payment due on a Due Date,
Licensor may charge Licensee interest on the unpaid amount at the annual rate of
two (2%) percent above the prime rate
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reported by the Wall Street Journal on that Due Date.
(g) Licensor may review or may designate, at its expense, a certified
public accountant to review the accounts of Licensee, for a period of not more
than four (4) Contract Quarters immediately preceding the date of review to
determine whether proper accounting and payments have been made. Any such review
will take place upon reasonable notice to Licensee and within regular business
hours. Acceptance or receipt of payment by Licensor will not preclude it from
questioning the correctness of any statement or royalty payment. Any review of
Licensee's accounts will be made under the strictest confidentiality. No
material obtained by Licensor or its designated auditor may be used or disclosed
for purposes other than enforcing compliance with the terms of this agreement
without the prior written consent of Licensee, unless ordered to do so by a
court or other tribunal having jurisdiction over Licensor, in which case
Licensor will give reasonable notice to Licensee.
9. Promotional Activities
Licensee will use its best efforts to fully promote the sale of the
Products in the Territory, and maintain the high standards of Licensor as to
advertising and all other promotional material. No advertising or promotional
material may be used by Licensee until it has been submitted to and approved by
Licensor, in writing, in advance. All advertising and promotional costs are to
be borne by Licensee. Licensor's approval will not be unreasonably withheld and,
if no objection is raised by Licensor
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within fifteen (15) business days of receipt of the material, Licensor will be
deemed to have approved them. In addition, Licensee will expend at least two
(2%) percent of Net Sales for general advertising and promotional activity as
directed by Licensor.
10. Term
Unless sooner terminated as hereinafter provided, this agreement will
commence as of the Effective Date and terminate at the end of the fifth Contract
Year. Either party, however, has the right to terminate this agreement after
three (3) years by notifying the other party, in writing, at least six (6)
months prior to the end of the third Contract Year, of its desire to terminate
this agreement.
11. Termination
(a) Either Licensor or Licensee may terminate this agreement, if it
gives written notice to the other party to the effect that that party has
committed a breach of a material provision of this agreement and the party
receiving said notice fails to cure that breach within thirty (30) days of such
receipt.
(b) Licensor may terminate this agreement by giving written notice to
Licensee effective on receipt, for damage to the commercial impression of the
Trademarks, if Licensee (i) becomes insolvent, (ii) files a petition in
bankruptcy or insolvency, (iii) files any petition or answer seeking
reorganization of Licensee's business under any law relating to insolvency or
bankruptcy, (iv) makes an assignment for the benefit of creditors, or (v) fails
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within thirty (30) days to secure the dismissal of any receiver, trustee or
liquidator appointed for any of its property.
(c) Licensor may terminate this agreement by giving written notice to
Licensee effective on receipt (i) if Licensee fails, within 30 days of its
accrual, to pay any monies owed to Licensor pursuant to this agreement, (ii) if
any competitor of Licensor becomes an Affiliate of Licensee, or (iii) if
Licensee fails to bring the Products to market as required by Subparagraph 5(c).
(d) If Licensee becomes Controlled by any persons or other legal
entities other than those controlling them or either of them as if the Effective
Date (individually or collectively the "New Owner"), the entity experiencing the
change will notify TFL within fifteen (15) business days, identifying the new
Controlling person or persons and providing verifiable information as to the New
Owner's financial standing. If within a similar period, TFL does not approve of
the New Owner, which approval will not be unreasonably withheld, this agreement
will terminate automatically at the end of such period.
(e) Upon termination of this agreement, Licensee will immediately and
completely discontinue use of the Trademarks, provided, however, that Licensee
may sell existing stock if it complies with subparagraph (f) of this paragraph.
(f) For a period not to exceed 120 days immediately following
termination of this agreement, Licensee may sell any completed Products it had
in stock on the date of termination. It
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is understood that Licensee will pay Licensor all royalties due from such sales
as though this agreement were still in effect. Within 10 business days after the
end of this 120-day period, an officer of the Licensee will deliver to the
Licensor a certification that all products in the possession or under the
control of the Licensee have been destroyed or given to charity.
(g) Termination for any reason will not prejudice the rights of either
party to collect monies owed it by the other party hereunder or to prosecute
claims for damages against the other party.
12. Indemnification
Licensee hereby indemnities Licensor and holds it harmless from any
Costs and will defend Licensor against any Claims arising out of or in
connection with Licensee's performance under this agreement, and for copyright
infringement, patent infringement or unfair competition caused by or arising out
of the manufacture or sale of the Products. Licensor will similarly defend and
indemnify Licensee for claims of trademark infringement.
13. Exoneration from Responsibility for Manufacturing Errors
Neither Licensor nor its employees will have any responsibility for the
operation of the manufacturing facilities of Licensee contemplated under this
agreement, whether upon the recommendation of Licensor or otherwise.
14. Arbitration
Any controversy or dispute arising out of or in connection with the
Agreement, whether relating to its
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interpretation, performance, or termination may be submitted to arbitration by
any party and it so submitted , will be finally settled by arbitration conducted
in accordance with the rules of the American Arbitration Association then in
effect. Any such arbitration will take place in New Jersey. The decision of a
single arbitrator will be binding and conclusive upon the parties, their
successors and assignees, and the parties will comply with such decision in good
faith. Judgment upon the decision of the arbitrator may be entered in any court
having jurisdiction over the party to be charged. The parties may each seek and
the arbitrator may grant in additional to legal remedies equitable remedies
(including, without limitation, temporary restraining orders, injunctions,
preliminary or permanent and attachments) and each hereby consents to
jurisdiction over its legal person in the State and Federal Courts of New Jersey
for the purpose of enforcing such orders .
15. Construction
This agreement will be construed in accordance with the internal laws
of the State of New Jersey.
16. Independent Contractors
Nothing contained in this agreement will constitute Licensee the agents
or legal representatives of Licensor for any purpose whatsoever. Licensee is an
independent contractors with the rights granted hereunder and no others.
17. Assignment
This agreement may not be assigned in whole or in part by
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or Licensee without Licensor's prior written consent and any such purported
assignment will be void. Except as expressly provided herein, this agreement
will be binding upon and inure to the benefit of the parties hereto, their
successors and assigns.
18. Notices
All notices, requests, demands and other communications which are
required or may be given under this agreement will be in writing and will be
deemed to have been given if delivered personally or sent by certified mail,
return receipt requested, postage prepaid and addressed:
If to Licensor to:
Mr. Gay X. Xxxxx
MEM Company, Inc.
X.X. Xxx 000
Xxxxxxxxx, Xxx Xxxxxx 00000
and to:
Xx. Xxxxxx Xxxxxxxxxx
Xxx Xxxxxx Ltd.
000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
with a copy to:
Xxxxxx X. Xxxxx, Esq.
Xxxxxxx, Xxxxxxxxxx & Xxxxxxx
Xxxxx 000
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000-0000
If to Licensee:
Mr. Xxxx Xxxxxxxxx
Red Box Toy (USA) Inc.
000 Xxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, Xxx Xxxxxx 00000
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with a copy to:
Mr. Xxxxx Xxx
Red Box Toy Factory Ltd.
1216 Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx Xxxx
Xxxxxxx, Xxxx Xxxx
and a copy to:
Xxxxxx X. Xxxxx, Esq.
Xxxxxxx, Xxxxxxxxxx & Xxxxxxx
Xxxxx 000
100 Thanet Circle
Princeton, New Jersey 08540-3662
or to such other addresses as may be furnished, from time to time, in writing,
by the parties hereto.
19. Miscellaneous
(a) This agreement contains all of the understandings of the parties
hereto and no provision of this agreement may be modified except in writing
signed by the parties hereto.
(b) The failure of any party to enforce any right hereunder will not be
deemed a waiver of any other right, whether of a similar nature or otherwise.
(c) If any provision of this agreement is declared void by any
arbitrator, court or administrative body of competent jurisdiction, the validity
of all other provisions which may nonetheless by given effect will not be
affected thereby.
IN WITNESS WHEREOF, the parties hereto have executed this
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agreement as of the day and year first above written.
ATTEST: XXX XXXXXX LTD.
By: /s/ Xxxxxx X. Xxxxxxxxxx
-------------------------- ----------------------------------
Xxxxxx X. Xxxxxxxxxx
Secretary President
[SEAL]
ATTEST: RED BOX TOY FACTORY LTD.
/s/ [signature illegible] By: /s/Yun Xxxx Xxx
-------------------------- ----------------------------------
Yun Xxxx Xxx
Secretary Managing Director
[SEAL]
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SCHEDULE A
1. Nail Dryer
2. Nail Dryer and Organizer
3. Nail Dryer and Accessories
4. Tote
5. Executive Set
6. Curler Set
7. Soft Vinyl Organizer
8. Hair Styling Set with B/O Hair Dryer
9. Magic Wand
10. Doll Case
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