Execution Copy
FIRST AMENDMENT TO TRADEMARK LICENSE AGREEMENT
This FIRST AMENDMENT to the TRADEMARK LICENSE AGREEMENT dated as of
February 13, 2003 by and between Blondie Rockwell, Inc., a New York corporation
with offices at c/o Erving Wonder Management, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxxxx,
XX 00000 (the "Licensor") and INNOVO AZTECA APPAREL, INC., a California
corporation with offices at 0000 X. Xxxxxxx Xxx., Xxxxx 000, Xxxxxxxx, XX 00000
(the "Licensee") ("License Agreement").
WHEREAS, Case Action No. 03-5060 PA SHSx was filed by Licensor in the
United States District Court for the Central District of California alleging
interference with Licensor's "FETISH" trademark by Fetish Group Inc., a
California corporation having a place of business at 0000 Xxxxx Xx Xxxxxx,
Xxxxxx, XX 00000;
WHEREAS, in settlement of the claims and issues arising in Case No. 03-5060
PA SHSx and other outstanding issues between the parties, as of August 22, 2003
Licensor executed a settlement agreement with Fetish Group, Inc. ("Settlement
Agreement");
WHEREAS, such Settlement Agreement required the payment by Licensor to
Fetish Group, Inc. in the amount of $105,000;
WHEREAS, Licensee is a third-party beneficiary of the terms of such
Settlement Agreement in that by the License Agreement it is licensed to
manufacture and sell goods bearing the "FETISH" trademark;
NOW, THEREFORE, the parties hereto, in consideration of the foregoing
premises and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound
hereby, stipulate and agree as follows:
1. The terms and provisions of the License Agreement are repeated and
incorporated herein by reference.
2. On behalf of Licensor, Licensee shall pay to Fetish Group, Inc. the
$105,000 payment required by the Settlement Agreement.
3. Licensor acknowledges that Licensee's payment of this sum on its behalf
shall satisfy Licensee's obligations for an Advance payment against quarterly
Guaranteed Minimum Royalties under Section 4(d)(ii) of the License Agreement,
which fall due on December 1, 2003.
4. Section 4(c) of the License Agreement shall be deleted in its entirety
and modified to read as follows:
"Royalties shall be paid quarterly within twenty (20) days following the
conclusion of each calendar quarter during the Term hereof, commencing on the
twentieth (20th) day of April 2003, and continuing on the twentieth (20th) day
of each July, October, January and April thereafter during the Term hereof. The
obligation of the Licensee to pay Royalties is absolute notwithstanding any
claim with Licensee may assert against Licensor. Licensee shall not have
the right to setoff, or to make any deduction from Royalties due pursuant to the
provisions hereof for any reason whatsoever; provided, however, that this
subsection shall not prohibit (i) a set off or deduction from Royalties in the
case of a claim by Licensee against Licensor which has become a liquidated
amount as the result of a decision by a court or an agreement of the parties or
(ii) the escrow of Royalties in accordance with Section10(b)(ii) of this
Agreement."
5. In consideration of the foregoing, Section 10(b) of the License
Agreement shall be deleted in its entirety and replaced with the following:
"(b)(i) The Licensor shall (and Licensor shall cause any successor in
interest to the Trademarks licensed under the License Agreement to) indemnify,
defend and hold the Licensee and its subsidiaries and affiliates and their
officers, directors, shareholders, employees, representatives and agents,
harmless against any and all claims, settlements, judgments, damages, losses,
costs and expenses (including but not limited to reasonable attorney fees and
litigation costs) incurred by the Licensee solely as a result of any claim by
any person, firm or entity that Licensee's use of the Property strictly in
accordance with this Agreement infringes upon any rights of such person, firm or
entity, to the extent such claim arises in a jurisdiction that is covered by
Licensor's representations and warranties as specifically set forth in Section
9(c)(ii) hereof. Licensee shall not, however, be entitled to any recovery for
lost profits. Additionally, if by reason of any claims referred to in this
subsection Licensee is precluded from selling any stock of Licensed Products or
utilizing any materials in its possession or which come into its possession by
reason of any required recall, Licensor shall be obligated to purchase such
Licensed Products and materials from Licensee at their out-of-pocket cost to
Licensee, excluding overhead, but Licensor shall have no other responsibility or
liability with respect to such Licensed Product or materials.
(ii) Notwithstanding anything to the contrary herein, solely in the event
that Licensee is temporarily, preliminarily or permanently enjoined by a Court
in any jurisdiction within the Territory from commercially exploiting the
Property within the Territory, Licensee shall be permitted to escrow all
Royalties (including Guaranteed Minimum Royalties) accrued thereafter to defray
any reasonable attorneys' fees and litigation costs incurred and/or damages
assessed until such time as such injunction is lifted. Any excess in such escrow
account shall be paid to Licensor. Nothing contained herein shall give Licensee
the right to escrow Royalty payments (including Guaranteed Minimum Royalties) in
accordance with this section, based upon the allegation by a third party
(whether made in the context of a lawsuit or otherwise) that Licensor and/or
Licensee is/are infringing upon any third party rights in connection with the
use and exploitation of the Property within the Territory, or for any other
reason except as specifically noted in this Section 10(b)(ii). Nothing contained
herein shall be construed to bind Xxx Xxxxxxx personally/individually to this
indemnity or otherwise."
6. The remainder of the provisions of the License Agreement shall remain in
full force and effect as if set forth herein.
7. This First Amendment may be executed in one or more counterparts, each
of which shall be deemed an original, and all of which, taken together, shall
constitute one and the same instrument.
IN WITNESS WHEREOF, each of the Licensor and Licensee has caused this First
Amendment to be executed by its duly authorized officer effective as of
September 8, 2003.
LICENSOR:
BLONDIE ROCKWELL, INC.
By: /s/ Xxx Xxxxxxx
---------------
Name: Xxx Xxxxxxx
Title: President
LICENSEE:
INNOVO AZTECA APPAREL. INC.
By: /s/ Xxxxxx X. Xxxxxx, Xx.
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Name: Xxxxxx X. Xxxxxx, Xx.
Title: Chief Executive Officer
