LICENSE AGREEMENT
This License Agreement (hereinafter referred to as "Agreement") is
effective as of February 12, 1997, by and between Xxxxxx Xxxxxxx, an
individual located at 0000 Xxxxxxx Xxxxx, Xxx Xxxxxxx, XX 00000 ( herein
referred to as "LICENSOR") and YES Clothing Co., a California corporation
located at 0000 Xxxx Xxxxxxxxxx Xxxxxxxxx, Xxx Xxxxxxx, XX 00000
(hereinafter referred to as "LICENSEE").
WHEREAS, LICENSEE desires to secure the right and license to use said
trademarks and intellectual property rights in connection with the design,
manufacture, advertisement, promotion, distribution and sale of certain
Licensed Products as defined hereinafter;
WHEREAS, LICENSOR is willing to grant LICENSEE such license, upon the
terms and conditions set forth below.
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein, the parties hereto agree as follows:
1. DEFINITIONS
The following terms shall have the meanings set forth below:
a. "Marks" shall mean the trademarks set forth in Schedule A attached
hereto and incorporated herein by this reference.
b. "Territory" shall mean solely the geographic area specifically set
forth and described in Schedule B, attached hereto and incorporated herein
by this reference.
c. "Licensed Products" shall mean solely the products specified in
Schedule C, attached hereto and incorporated herein by this reference.
d. "Net Sales" shall mean the total of gross dollar amounts invoiced or
charged to others by LICENSEE for all Licensed Products sold, distributed,
or transferred under the Licensed Rights, reduced by the amount of any BONA
FIDE trade quantity discounts and actual returns plus any co-op or
advertising discounts given to customers.
e. "Contract Period" shall mean a sixty (60) day period beginning on the
Effective Date, plus a right to sell off any goods produced during the
Contract Period for three (3) months thereafter.
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2. RIGHTS GRANTED
a. LICENSOR hereby grants to LICENSEE, and LICENSEE accepts, upon the
terms and conditions set forth herein, an exclusive, non-transferable right
and license to use the Licensed Rights solely on or in connection with the
design, manufacture, advertisement, promotion, distribution and sale of
Licensed Products solely within the Territory.
b. The parties acknowledge and agree that this Agreement is an
intellectual property rights license agreement and does not constitute, and
shall not be construed as, a franchise agreement. The parties further
acknowledge and agree that State and Federal franchise laws do not and will
not apply to this Agreement or to the relationship between LICENSEE and
LICENSOR and the respective rights and obligations hereunder since the
parties agree that, due to their respective business backgrounds and prior
licensing experience, they do not need the protection of State or Federal
franchise laws.
c. On or before the end of the Contract Period, LICENSOR gives
LICENSEE exclusive right to purchase the marks at a price set forth in
Exhibit F.
3. DURATION
This Agreement shall commence on the effective date set forth above
and in Schedule D attached hereto and incorporated herein by this
reference.
4. ROYALTIES
a. LICENSEE agrees to pay to LICENSOR a "Combined Payment" as set
forth on Schedule E equal to the sum of:
(i) royalties; and
(ii) purchase order sales commission.
b. The Combined Payment shall be computed by applying the sum of the
percentage rates set forth in Exhibit E ("Combined Rate") to the Net Sales.
Licensee shall reserve Combined Payment for potential chargebacks Licensee
may incur which are unknown and not related to sales of licensed Products
by the Licensee.
5. BOOKS AND RECORDS
a. LICENSEE shall keep complete and accurate records of all Licensed
Products manufactured, distributed and sold under the Licensed Rights and
of LICENSEE's activities and of all transactions relating to LICENSEE's
activities under this Agreement, and shall make the same readily available
to LICENSOR, and its agents or representatives, at such reasonable times as
LICENSOR may from time to time request for inspection, copying and
extracting.
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b. Such books of account and records shall be kept in accordance with
generally accepted accounting principles, consistently applied, and shall
be retained by LICENSEE and kept available for at least three (3) years
after the termination of the Contract Period of this Agreement for possible
inspection, copying, extracting and/or audit by LICENSOR. All financial
information obtained by LICENSOR regarding LICENSEE shall be kept
confidential except in the event that such information is necessary to
resolve a BONA FIDE dispute between the parties.
6. INDEPENDENT CONTRACTOR
The parties hereby agree that LICENSEE is and shall be an independent
contractor and that no agency, joint venture or partnership is created by
this Agreement. The legal relationship of any person or entity performing
services for LICENSEE shall be one solely between said parties. LICENSEE
shall incur no obligation in the name of LICENSOR without the prior written
consent of LICENSOR.
7. INDEMNIFICATION
a. LICENSEE will indemnify, defend and hold LICENSOR and its agents
and employees harmless from any and all liabilities, claims, obligations,
suits, judgments and expenses whatsoever, including court costs and
attorneys' fees, which LICENSOR may incur or which may be asserted against
LICENSOR, and which arise or occur with respect to the operation of
LICENSEE's business as it relates to this Agreement.
b. LICENSOR will indemnify, defend and hold LICENSEE and its agents
and employees harmless from any and all liabilities, claims, obligations,
suits judgments and expenses whatsoever, including court costs and
attorneys' fees, which LICENSEE may incur or which may be asserted against
LICENSEE which arise or occur with respect to LICENSOR' own acts or
omissions.
8. NOTICE
All notices, approvals, consents, requests, demands or other
communication to be given to either party shall be in writing, by certified
mail, return receipt requested, or by other means where receipt is
acknowledged, and shall be effective on the date of receipt thereof. If
undeliverable, or if receipt is not acknowledged, such communication shall
be effective on the date mailed or sent. Such communication shall be
addressed to LICENSEE and LICENSOR at their respective addresses set forth
in the preamble above, or at any other address that each party shall
provide to the other in writing.
9. GOVERNING LAW AND RESOLUTION OF DISPUTES
a. This Agreement shall be construed in accordance with the laws of
the State of California, and the parties agree that it is executed and
delivered in the State of California. In the event any legal action
becomes necessary to enforce or interpret the terms of this Agreement, the
parties agree that such action will be brought in the Los Angeles Superior
Court or in the U.S.
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Xxxxxxxx Xxxxx for the Central District of California, and the parties hereby
submit to the jurisdiction of said courts.
b. In any dispute between the parties, the prevailing party shall be
entitled to recover its reasonable costs and fees, including attorneys'
fees, from the non-prevailing party.
10. BINDING EFFECT
This Agreement shall be binding on the parties, their affiliated
companies, successors and assigns (if any), and they each warrant that the
undersigned are authorized to execute this Agreement on behalf of their
respective parties. This Agreement is also binding upon the officers,
directors, agents, employees and shareholders of the parties, and any other
person acting in concert with them.
11. MANUFACTURE OF LICENSED PRODUCTS BY OTHERS
LICENSEE represents that any third party manufacturers, sub-contractors,
etc., shall operate their facilities in a manner that complies with all State
and Federal labor and business codes.
12. GENERAL PROVISIONS
a. No waiver or modification of any of the terms or provisions of
this Agreement shall be valid unless contained in a single written document
signed by both parties. No course of conduct or dealing between the
parties shall act as a waiver of any provision of this Agreement.
b. This Agreement, including Schedules A through F attached hereto,
contains the entire understanding of the parties, and there are no
representations, warranties, promises or undertakings other than those
contained herein. This Agreement supersedes and cancels all previous
agreements between the parties hereto.
c. In the event any legal action becomes necessary to enforce or
interpret the terms of this Agreement, the prevailing party shall be
entitled, in addition to its court costs or arbitration fees, to such
reasonable attorneys' fees as shall be fixed by a court of competent
jurisdiction or by an arbitrator(s).
d. The subject headings of the paragraphs and subparagraphs of this
Agreement are included for convenience only, and shall not affect the
construction or interpretation of its provisions.
e. If any provision of this Agreement should be held to be void or
unenforceable, such provision will be treated as severable, leaving valid
the remainder of this Agreement.
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f. The parties represent and warrant that they have made no
agreements that are inconsistent with this Agreement or that would prevent
them from entering into this Agreement. The parties further represent and
warrant that entering into this Agreement does not violate any agreements,
rights or obligations existing between them and any other entity.
IN WITNESS WHEREOF, the parties agree that this Agreement shall take
effect as of the date first written above.
LICENSOR
February 12, 1997 /s/Xxxxxxx Xxxxxxx
Dated:
---------------------------- ---------------------------
XXXXXXX XXXXXXX
An Individual
LICENSEE (Yes Clothing Co.)
February 12, 1997 /s/ Guy Anthome
Dated: By:
---------------------------- ---------------------------
GUY ANTHOME
Chairman and CEO
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SCHEDULES
A: Marks: Audience
B: Territory: Worldwide
C. Licensed Products: Men's, Women's and Kids Apparel
D. Effective Date: February 12, 1997
Duration/Contract Period:
Contract Period Beginning Ending
--------------- --------- --------
1 2/12/97 04/11/97
E: Combined Rate
Rate:
------------
Combined Rate: All types of Apparel
Royalty Rate 3.0%
Purchase Order Commission 6.0%
Combined Rate: 9.0%
F. Purchase Option Price: Ten Thousand U.S. Dollars ($10,000.00)
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