TRADEMARK SUBLICENSE AGREEMENT
AGREEMENT made this 24th day of October, 1997 ("Effective Date"), by
and between Xxxxx X. Xxxxxx ("Sublicensor") and Hard Rock Hotel, Inc.
("Sublicensee").
W I T N E S S E T H:
WHEREAS, pursuant to the Trademark License and Cooperation
Agreement dated as of June 7, 1996 by and between Rank Licensing, Inc.
("Licensor") and Sublicensor (the "Trademark Agreement"), Sublicensor is the
exclusive licensee of the Hard Rock Hotel Marks and Hard Rock Casino Marks for
use and exploitation in connection with Hard Rock Hotel/Casinos and Hard Rock
Casinos in the Xxxxxx Territories and has the right to sublicense or
franchise any or all of its rights thereunder; and
WHEREAS, Sublicensor wishes to license to Sublicensee, and
Sublicensee wishes to acquire from Sublicensor a license to use such Hard Rock
Hotel Marks and Hard Rock Casino Marks in connection with its operation of
the Hard Rock Hotel/Casino and Hard Rock Casino located in the Las Vegas,
Nevada Metropolitan Statistical Area (the "Las Vegas Hotel");
NOW, THEREFORE, for good and valuable consideration, including the
mutual promises set forth herein, the receipt and sufficiency of which is
hereby acknowledged, the parties agree as follows:
Article 1. DEFINITIONS. Defined terms used in this Agreement but
not specified herein shall have the meanings specified in the Trademark
Agreement (including all Exhibits, Schedules and Attachments thereto).
Article 2. GRANTS OF RIGHT.
Section 2.1. Sublicensor hereby grants to Sublicensee an
exclusive, royalty-free license to use the Hard Rock Hotel Marks and Hard Rock
Casino Marks as listed on Exhibits A and B (such Exhibits corresponding to
those of the Trademark Agreement) (collectively, the "Sublicensed Marks"),
solely in connection with the development, operation, ownership, management,
operation of and promotion of the Las Vegas Hotel, including the offering or
sale by Sublicensee of Licensed Products bearing the Sublicensed Marks
("Sublicensed Products") to the extent permitted under the Trademark
Agreement. Sublicensee shall not use or exploit the Sublicensed Marks
elsewhere in the world, except, however, Sublicensee may engage in the
promotion, advertising or marketing of the Las Vegas Hotel anywhere in the
world.
Section 2.2. All rights not expressly granted to Sublicensee in
Section 2.1 are reserved to Sublicensor. Sublicensee shall not otherwise
develop, use or exploit the
Sublicensed Marks without the express written consent of Sublicensor.
Nothing herein shall prohibit Sublicensee from developing, owning, operating
or managing a Hotel, a Hotel/Casino or a Casino that is NOT operated under
the Sublicensed Marks or any confusingly similar trademarks or trade names
anywhere in the world.
Section 2.3. Sublicensee agrees, as a sublicensee under Section 10
of the Trademark Agreement to assume, observe and perform all of
Sublicensor's obligations, and to be bound by all of Sublicensor's
restrictions and reservations of rights, under the Trademark Agreement.
Exhibits C, D and E hereto correspond to Exhibits C, D and E of such
Trademark Agreement and refer to Sublicensor's obligations under Section
2(b)(vi), (vii) and (viii) therein. Sublicensee acknowledges that
it is familiar with the terms of such obligations, restrictions and
reservations of rights.
Section 2.4. Upon request of Sublicensee, Sublicensor agrees to
exercise its rights under Section 2(b)(iii) of the Trademark Agreement as
necessary to protect and preserve the registrations and/or renewals of the
Sublicensed Marks.
Section 2.5. Sublicensor agrees to take all actions within its
control necessary to establish Licensor's claim of title in the Sublicensed
Marks and to allow Sublicensee or the Lenders under the Credit Agreement (as
defined herein) to document the existence of this Agreement and any security
interest granted to the Lenders with the United States Patent and Trademark
Office.
Article 3. FORM OF USE.
Section 3.1. Sublicensee agrees to use the Sublicensed Marks in
good faith and in a dignified manner, in a manner consistent with
Sublicensor's high standards of, and reputation for quality, in a manner
consistent with Sublicensee's own current standards for quality, and in
accordance with good trademark practice wherever the Sublicensed Marks are
used. Sublicensor and Sublicensee agree to use their best efforts to protect
the Sublicensed Marks and the goodwill associated therewith.
Section 3.2. Except as required by law and/or as expressly
provided in Section 2.3, Sublicensee agrees not to use any word, words, term
or terms to identify its company in conjunction with the Sublicensed Marks
and/or the Licensed Services provided by Sublicensee in connection with or
relating to the operation of the Las Vegas Hotel ("Sublicensed Services")
(other than geographic designations) if such use would in any way dominate,
modify or qualify the Sublicensed Marks. Sublicensee shall at no time use or
authorize the use of any service xxxx, trademark, trade name or other
designation identical with or confusingly similar to the Sublicensed Marks.
Section 3.3. Sublicensee agrees to include on all uses of the
Sublicensed Marks all notices and legends required by applicable law or
regulations to preserve and protect all of Licensor's and Sublicensor's
right, title and interest in, to and under the Sublicensed Marks, including
without limitation those reasonably requested by Sublicensor. Sublicensee
shall comply in all respects with all applicable laws and regulations and
obtain all
-2-
appropriate permits and approvals in regard to the Sublicensed Products and
Sublicensed Services.
Section 3.4. Sublicensee shall use the Sublicensed Marks on any
advertising or promotional materials related to Sublicensed Services or
Sublicensed Products wherever the Sublicensed Marks may be used with
reasonable convenience.
Article 4. OWNERSHIP OF SUBLICENSED MARKS.
Section 4.1. Sublicensee acknowledges and agrees that Licensor is
the exclusive owner of all right, title and interest to the Sublicensed
Marks, and that Sublicensee will not gain any ownership interest in the
Sublicensed Marks under any circumstances. Sublicensee further acknowledges
that Sublicensor owns the exclusive rights granted to Sublicensee in Section
2.1 by virtue of a valid license from Licensor.
Section 4.2. Sublicensee recognizes the value of the goodwill
associated with the Sublicensed Marks and acknowledges that the Sublicensed
Marks have acquired secondary meaning. Sublicensee agrees not to directly or
indirectly question, attack, contest or in any other manner impugn the
validity of the Sublicensed Marks or Licensor's and/or Sublicensor's rights
in and to the Sublicensed Marks, or this Agreement, including without
limitation thereto, in any action in which enforcement of a provision of this
Agreement is sought, nor shall Sublicensee willingly become a party adverse
to Sublicensor in litigation in which a third party contests the validity of
the Sublicensed Marks or Licensor's and/or Sublicensor's rights in and to the
Sublicensed Marks. Sublicensee shall not at any time apply for any
registration of any copyright, trademark or other designation nor file any
document requesting any governmental authority to take any action nor take
any action itself which would affect the ownership of or potentially damage,
dilute or modify the Sublicensed Marks.
Section 4.3. Sublicensee shall be considered a "related company"
to Sublicensor, as that term is defined by the U.S. Xxxxxx Act, such that any
and all goodwill arising from Sublicensee's use of the Sublicensed Marks
shall inure solely to the benefit of Sublicensor, and neither during nor
after the expiration or termination of this Agreement and the license granted
hereunder shall Sublicensee assert any claim to the Sublicensed Marks or such
goodwill. Sublicensee shall not take any action that could be detrimental to
the Sublicensed Marks or the goodwill associated with the Sublicensed Marks,
Sublicensor or Licensor.
Section 4.4. Sublicensee shall, during the Term of this Agreement
and after expiration or termination hereof, execute such documents as
Sublicensor may reasonably request from time to time to make any necessary
government recordings for Sublicensor or Licensor.
Section 4.5. The provisions of this Article 4 shall survive any
expiration or termination of this Agreement.
-3-
Article 5. QUALITY CONTROL.
Section 5.1. Sublicensee covenants that the nature and quality of
the Sublicensed Products and the Sublicensed Services and all promotional,
advertising, and packaging material relating to the Sublicensed Products and
Sublicensed Services, and all representations of the Sublicensed Marks, shall
be of good quality at least as high as the quality of similar goods presently
sold or distributed by Sublicensor or Sublicensee. Sublicensee acknowledges
that it is familiar with the nature and quality of the Licensed Products and
Licensed Services and with the representations of the Sublicensed Marks now
in use. With respect to any additional Sublicensed Services or Sublicensed
Products, Sublicensee agrees that the nature and quality of such products and
services shall be equal to and commensurate with that of existing products
and services offered by Sublicensor and Sublicensee.
Section 5.2. Sublicensor shall have the right to inspect the
quality of the Sublicensed Products and Sublicensed Services, and Sublicensee
shall permit duly authorized representatives of Sublicensor to have
reasonable access to all areas of the Hard Rock Hotel/Casinos or Hard Rock
Casinos for such inspection purposes during regular business hours and on
reasonable notice and in a manner that will cause minimal disruption to
Sublicensee's business.
Section 5.3. Sublicensee shall furnish or render to Sublicensor
during such inspections, upon request for Sublicensor's approval and/or
testing, representative samples on the premises of each Sublicensed Product,
its labels, packaging, advertisements, and all other materials displaying or
using the Sublicensed Marks in relation to the Sublicensed Products and
Sublicensed Services.
Section 5.4. The parties acknowledge that all rights of
Sublicensor to monitor and intervene in Sublicensee's operations, and all
standards of operation set forth herein, are established solely to ensure the
quality of the goods and services associated with the Sublicensed Marks and
to protect the goodwill accrued in them.
Article 6. TERM OF LICENSE. The term of this Agreement ("Term")
commences on the Effective Date and continues for as long as any Commitment,
Loan or Letter of Credit Liability (each as defined in the Credit Agreement)
are outstanding under the Credit Agreement dated as of September 26, 1997
among Hard Rock Hotel, Inc. and Xxxxxxx Xxxxx & Co., and Xxxxx Fargo Bank,
National Association, as agents (the "Credit Agreement").
Article 7. TERMINATION.
Section 7.1. Subject to the provisions of Article 11, Sublicensor
and Sublicensee each have the right to terminate this Agreement if the other
party commits a material breach of its obligations hereof, including without
limitation a breach of Articles 2, 3, 4, or 12, and fails to cure such breach
within thirty (30) days' written notice.
-4-
Section 7.2. Sublicensor has the right to terminate this Agreement
immediately upon written notice to Sublicensee if (i) Sublicensee makes an
assignment for the benefit of creditors; (ii) Sublicensee admits in writing
its inability to pay debts as they mature; (iii) a trustee or receiver is
appointed for a substantial part of Sublicensee's assets; or (iv) to the
extent termination is enforceable under the U.S. Bankruptcy Code, a
proceeding in bankruptcy is instituted against Sublicensee which is
acquiesced in, is not dismissed within 120 days, or results in an
adjudication of bankruptcy.
Section 7.3. If an event described in Section 7.2 occurs,
Sublicensor shall have the right, in addition to its other rights and
remedies, to suspend Sublicensee's rights regarding the Sublicensed Marks
while Sublicensee attempts to remedy the situation.
Section 7.4. Upon expiration pursuant to Article 6 or termination
pursuant to Article 7, Sublicensor and Sublicensee shall cooperate so as best
to preserve the value of the Sublicensed Marks. Upon expiration or
termination, Sublicensee agrees immediately to discontinue all use of
Sublicensed Marks, and at Sublicensor's request, to destroy or return any
materials related to same.
Article 8. INFRINGEMENT.
Section 8.1. Sublicensee agrees to notify Sublicensor in writing
immediately after it becomes aware of any actual or threatened infringement,
impairment or other unauthorized use or conduct in derogation
("Infringement") of the Sublicensed Marks. Sublicensee shall not file an
action, suit or proceeding ("Action") alleging Infringement of the Sublicensed
Marks without the prior written consent of Sublicensor. Licensor and
Sublicensor, in their absolute discretion, may file an Action alleging
Infringement of the Sublicensed Marks without the consent of Sublicensee.
Sublicensee agrees to cooperate with Licensor and/or Sublicensor, at
Sublicensor's request, in any such Action.
Section 8.2. In any Action alleging Infringement of the
Sublicensed Marks or otherwise Sublicensee shall pay such costs and any
resulting damages, monetary judgment, settlement and/or compensation paid for
such Infringement.
Section 8.3. Absent a later agreement to the contrary, Sublicensor
and Sublicensee agree to divide evenly any costs and expenses of, and any
damages, monetary judgment, settlement and/or liability resulting from, any
Action brought in any of the Xxxxxx Territories where Sublicensee is using
the Sublicensed Marks, alleging that the Sublicensed Marks cause the
Infringement of the intellectual property rights of a third party.
Article 9. REPRESENTATIONS AND WARRANTIES.
Section 9.1. Sublicensor and Sublicensee each represents and
warrants to the other party that:
(a) This Agreement is a legal, valid and binding obligation of
the warranting party, enforceable against such party in accordance with
its terms, subject
-5-
to the effect of any applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights and remedies
generally, and subject, as to enforceability, to the effect of general
principles of equity (regardless of whether enforcement is considered in a
proceeding at law or in equity);
(b) The warranting party is not subject to any judgment, order,
injunction, decree or award of any court, administrative agency or
governmental body that would or might interfere with its performance of
any of its material obligations hereunder, and
(c) The warranting party has full power and authority to enter
into and perform its obligations under this Agreement in accordance with
its terms.
Section 9.2. Sublicensor represents and warrants that, by virtue of
the Trademark Agreement, Sublicensor has full right and authority to grant to
Sublicensee the license set forth in Section 2.1.
Section 9.3. NOTWITHSTANDING SECTION 9.2, SUBLICENSEE ACKNOWLEDGES
THAT SUBLICENSOR MAKES NO REPRESENTATION OR WARRANTY WHATSOEVER AS TO
OWNERSHIP OR VALUE OF THE SUBLICENSED MARKS. THE SUBLICENSED MARKS ARE HEREBY
LICENSED TO SUBLICENSEE ON AN "AS IS" BASIS, AND SUBLICENSEE SHALL BEAR THE
ECONOMIC AND LEGAL RISK THAT SUBLICENSOR'S RIGHT TO USE THE SUBLICENSED MARKS
SHALL BE OTHER THAN GOOD AND MARKETABLE AND FREE FROM ENCUMBRANCES AND THAT
THE SUBLICENSED MARKS SHALL BE VALID AND FREE FROM CONFLICT IN THE XXXXXX
TERRITORIES.
Article 10. INDEMNIFICATION. Sublicensee hereby indemnifies
Sublicensor and undertakes to defend Sublicensor against, and hold
Sublicensor harmless from, any suits, loss and damage arising out of any
service or act rendered or performed by Sublicensee in connection with this
Agreement in relation to the Sublicensed Marks, or out of the sale of any
Sublicensed Products or rendering of any Sublicensed Services by Sublicensee.
Article 11. DISPUTE RESOLUTION.
Section 11.1. In the event that Sublicensor should note any
material failure by Sublicensee to maintain in any respect quality standards
set forth herein, Sublicensor shall advise Sublicensee in writing of the
particular failure or deficiency noted, and Sublicensee shall correct the
same within thirty (30) days of the mailing of such notice. In the event of
any dispute regarding the failure of Sublicensee to conform to any provision
of quality control as set forth herein or to correct any such related
deficiencies, the dispute shall be resolved by binding arbitration, upon the
initiation of either party by a written notice to the other party demanding
arbitration and specifying the controversy or claim to be arbitrated. The
arbitration shall be conducted in California by a single arbitrator or by a
panel of three arbitrators as agreed between the parties. The arbitrator(s)
shall be chosen in the manner prescribed by the American Arbitration
Association and the arbitration shall be conducted
-6-
under auspices, rules and regulations of the American Arbitration Association
with all fees and costs to be shared equally by the parties to the
arbitration. The arbitrators(s) shall have the power to award any and all
remedies and relief whatsoever that are deemed appropriate under the
circumstances, including equitable relief.
Section 11.2. The written decision of the arbitrator(s) shall be
rendered within thirty (30) business days following the close of the
arbitration hearing. The written decision of the arbitrator(s) shall be
binding and conclusive on the parties thereto and enforceable as provided by
the laws of the State of New York, and judgment on such arbitration decision
may be entered by any court having jurisdiction thereof.
Section 11.3. It is expressly acknowledged and agreed that any claims
or controversies not specifically identified hereinabove, including but not
limited to claims, controversies or disputes relating to the validity of
this Agreement or the validity or enforceability of any trademark rights
hereunder, shall be excluded from arbitration and shall be adjudicated in a
court of competent jurisdiction unless otherwise agreed to by the parties.
Any litigation between the parties arising out of or relating to this
Agreement shall be brought exclusively in the state or federal courts located
in the State of New York.
Section 11.4. Sublicensee acknowledges and agrees that the Sublicensed
Marks constitute the unique and valuable property rights of Sublicensor, and
further acknowledges and agrees that, due to the nature of many of the terms
and provisions of this Agreement, money damages will not compensate
Sublicensor as a result of any breach of this Agreement by Sublicensee.
Accordingly, the parties hereto agree that Sublicensor shall be entitled to
obtain without bond from a court of competent jurisdiction an injunction or
restraining order or a decree for specific performance of the terms of this
Agreement or to maintain the status quo during the arbitration process
described herein.
Article 12. ASSIGNMENTS AND SUBLICENSES. This Agreement, or any
portion thereof, may not be assigned or sublicensed by Sublicensee without the
prior written consent of Sublicensor, except that this Agreement and
Sublicensee's rights hereunder may be pledged as collateral security for any
financing of Sublicensee. Any attempted assignment or sublicense by either
party not in accordance with this Article 12 shall be void and shall
constitute a material breach of this Agreement.
Article 13. NOTICES. All notices and other communications hereunder
shall be in writing and hand delivered or mailed by registered or certified
mail (return receipt requested) or internationally recognized overnight
courier service or sent by any means of electronic message transmission with
delivery confirmed (by voice or otherwise) to the parties at the following
addresses (or at such other addresses for a party as shall be specified by
like notice) and will be deemed given on the date on which such notice is
received:
-7-
If to Sublicensor:
Xxxxx X. Xxxxxx
000 Xxxxx Xxxxxxxxx Xxxxxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telephone No.: 000-000-0000
Telecopy No.: 000-000-0000
With a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxxx
Telephone No.: 000-000-0000
Telecopy No.: 000-000-0000
If to Sublicensee:
Article 14. SURVIVAL. Except as otherwise contemplated by this
Agreement, all representations, warranties and indemnities contained in this
Agreement shall survive any independent investigation made by the benefiting
party and the expiration, suspension or termination of this Agreement.
Article 15. RELATIONSHIP. Sublicensee shall not use the name or
credit of Sublicensor in any manner whatsoever nor incur any obligation in
Sublicensor's name. Nothing herein shall be construed to constitute the
parties as joint venturers, nor shall any relationship other than Sublicensor
and Sublicensee be deemed to exist between them. It is specifically
understood that the rights and powers retained by Sublicensor to supervise or
otherwise intervene in Sublicensee's activities, all as provided in this
Agreement, are retained solely because of the necessity of protecting
Sublicensor's interest in the Sublicensed Marks and the goodwill symbolized
thereby.
Article 16. FURTHER ASSURANCES. Sublicensor and Sublicensee agree to
execute such further documentation and perform such further actions,
including the recordation of such documentation with appropriate authorities,
as may be reasonably requested by the other party to evidence and effectuate
further the purposes and intents set forth in this Agreement.
Article 17. ENTIRE AGREEMENT/CONSTRUCTION. This Agreement, including
the Schedules, shall constitute the entire agreement between the parties with
respect to the subject matter hereof and shall supersede all previous
negotiations, commitments and writings with respect to such subject matter.
-8-
Article 18. AMENDMENTS. This Agreement may not be modified or amended
except by an agreement in writing signed by each of the parties hereto.
Article 19. CUMULATIVE RIGHTS; WAIVER. All rights and remedies which
Sublicensor or Sublicensee may be hereunder or by operation of law are
cumulative, and the pursuit of one right or remedy shall not be deemed an
election to waive or renounce any other right or remedy. The failure of
either Sublicensor or Sublicensee to require strict performance by the other
party of any provision in this Agreement will not waive or diminish that
party's right to demand strict performance thereafter of that or any other
provision hereof.
Article 20. SEVERABILITY. The parties agree that each provision of
this Agreement shall be construed as separable and divisible from every other
provision. The unenforceability of any one provision shall not limit the
enforceability, in whole or in part, of any other provision hereof. If any
term or provision of this Agreement (or the application thereof to any party
or set of circumstances) shall be held invalid or unenforceable in any
jurisdiction to any extent, it shall be ineffective only to the extent of
such invalidity or unenforceability and shall not invalidate or render
unenforceable any other terms or provisions of this Agreement (or such
applicability thereof). In such event, the parties shall negotiate in good
faith a valid, enforceable, applicable substitute provision that imitates as
closely as possible the previous term or provision and has an effect as
comparable as possible on the parties respective positions.
Article 21. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed in the State of New York.
Article 22. LIMITATION OF LIABILITY. IN NO EVENT SHALL ANY PARTY BE
LIABLE FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES. WHETHER FORESEEABLE OR
NOT. OCCASIONED BY FAILURE TO PERFORM OR BREACH OF ANY OBLIGATION UNDER THIS
AGREEMENT FOR ANY CAUSE WHATSOEVER.
Article 23. TITLES AND SECTION HEADINGS. Titles and headings to
sections herein are inserted for the convenience of reference only and are
not intended to be a part of or to affect the meaning or interpretation of
this Agreement.
Article 24. SEPARATE COUNTERPARTS. This Agreement may be executed in
one or more counterparts, all of which shall be considered one and the same
agreement, and shall become effective when one or more such counterparts have
been signed by each of the parties and delivered to the other parties.
-9-
IN WITNESS WHEREOF, the parties hereto have executed this agreement,
effective as of the date first above written.
XXXXX X. XXXXXX
("Sublicensor")
/s/ Xxxxx Xxxxxx
---------------------------------------
Date: 10/21/97
HARD ROCK HOTEL CORPORATION
("Sublicensee")
By: /s/ Xxxxx Xxxxxx
---------------------------------------
Name: Xxxxx Xxxxxx
Title: President
Date: 10/21/97
see attached
---------------------------------
Notary Public
-00-
XXXXXXXXXX XXX-XXXXXXX XXXXXXXXXXXXXX
Xxxxx of California
---------------------
County of Los Angeles
---------------------
On 10-21-97 before me, Xxxxxx Xxxxxxxx ,
-------- ---------------------------------------------------
Date Name and Title of Officer (e.g. "Xxxx Xxx, Notary Public")
personally appeared Xxxxx Xxxxxx
------------------------------------------------------,
Name(s) of Signer(s)
X personally known to me
---
to be the person whose name is subscribed to the
within instrument and acknowledged to me that he
--------------- executed the same in his authorized capacity(ies),
NOTARY SEAL and that by his signature(s) on the instrument the
--------------- person, or the entity upon behalf of which the
person acted, executed the instrument.
WITNESS my hand and official seal.
Xxxxxx Xxxxxxxx
--------------------------------------------------
Signature of Notary Public
---------------------------------OPTIONAL-----------------------------------
THOUGH THE INFORMATION BELOW IS NOT REQUIRED BY LAW, IT MAY PROVE VALUABLE
TO PERSONS RELYING ON THE DOCUMENT AND COULD PREVENT FRAUDULENT REMOVAL AND
REATTACHMENT OF THIS FORM TO ANOTHER DOCUMENT.
EXHIBIT A
HARD ROCK HOTEL
HARD ROCK CASINO
-11-
EXHIBIT B
HARD ROCK CASINO
-12-
EXHIBIT C
[HARD ROCK CAFE LOGO]
LAS VEGAS **
* Replace with Hotel or Casino
** May be replaced with "Beach Club"
or "Athletic Club" as designations
EXHIBIT D
[HARD ROCK HOTEL LOGO]
Beach Club*
*Or Athletic Club
EXHIBIT E
[HARD ROCK BEACH CLUB* LOGO]
*OR "ATHLETIC CLUB"
