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EXHIBIT 10.10
TRADEMARK LICENSE AGREEMENT
THIS AGREEMENT, made this 3rd day of May 1996, by and between Showbiz Pizza
Time, Inc., a Kansas corporation with its principal place of business at 0000
Xxxx Xxxxxxx Xxxxxxx, Xxxxxx, Xxxxx 00000 (hereinafter "PIZZA TIME") and The
Delicious Frookie Company, Inc., a Delaware corporation with a place of business
at 0000 Xxxxx Xxxx, Xxxxx 000, Xxx Xxxxxxx, Xxxxxxxx 00000 (hereinafter "DFC").
WHEREAS, DFC seeks to license the trademarks in Section 1.1 in the territory
identified in Section 1.2 in connection with the manufacture, marketing and sale
of all cookies, crackers, freeze pops and cones for ice cream with the right of
first refusal for snacks, snack mix, and popcorn; and
WHEREAS, PIZZA TIME is willing to grant such a license to DFC subject to the
terms and conditions set forth below.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein, the parties agree as follows:
1. Definitions
The following definitions shall apply for the purposes of
this Agreement;
1.1 Trademarks - The term "Trademarks" shall mean only the
trademarks set forth in Exhibit A attached hereto and
hereby incorporated by reference.
1.2 Territory - The term "Territory" shall mean only the
United States, its territories and possessions, all U. S.
military bases, and Canada. The parties agree that
additional countries, or portions thereof may be added to
the definition of Territory upon the mutual agreement of
the parties, with mutual agreement not being unreasonably
withheld by PIZZA TIME.
1.3 Licensed Products - The term "Licensed Products" shall
mean any cookie, cracker, freeze pop type, ice cream
cones, popcorn, packaged snacks and snack mix.
1.4 Net Sales - The term "Net Sales" shall mean gross
sales of Licensed Products less cash, promotional and
term discounts, merchandising allowances, freight and
returns.
2. Grant of License
2.1 Subject to the terms and conditions set forth herein,
PIZZA TIME does hereby grant to DFC a
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royalty-bearing, exclusive license to utilize the
Trademarks in the Territory in connection with the
manufacture, marketing and sale of Licensed Products. DFC
hereby accepts such license.
2.2 DFC agrees not to grant any license or sublicense of the
Trademarks and shall not otherwise assign or transfer any
rights granted by PIZZA TIME pursuant to this Agreement.
It is understood by the parties that the manufacture of
the licensed product(s) may be performed by a party
designated by DFC and acceptable to PIZZA TIME and that
therefore in any reference in this agreement to
manufacture by DFC may apply to a third party.
Notwithstanding the foregoing, DFC shall remain
responsible for the manufacturing of the Licensed
Product(s) hereunder.
2.3 The parties agree that nothing herein shall prohibit PIZZA
TIME from utilizing or permitting third parties to utilize
Trademarks in Territory on any product not related to the
Licensed Products or outside of Territory on any product,
and PIZZA TIME expressly reserves the right to do so .
3. Term
The term of this Agreement shall commence on the day and year first
above written and shall continue for a period of five years ("Initial Term"). If
neither party has terminated the Agreement upon the expiration of the Initial
term, the parties agree that, commencing upon the conclusion of the Initial
Term, the Agreement shall be automatically renewed for successive five (5) year
terms unless earlier termination as provided for in this Agreement has occurred.
4. Termination
4.1 DFC shall have the right to terminate this Agreement at
anytime upon ninety (90) days written notice to PIZZA TIME
and in the event DFC elects to so terminate, it shall
continue to remit to PIZZA TIME the royalty payments due
PIZZA TIME as the same may become due during the ninety
(90) day notice period, which shall be deemed to commence
on the date of PIZZA TIME receives receipt of notice, or
thereafter if such payments become due after the ninety
(90) day notice period has expired.
4.2 In the event DFC breaches any of the provisions of
Sections 6, 7, 9, 10, 11, 13, 16, 17 and 18, the parties
agree that PIZZA TIME may in its sole discretion, provide
DFC with ninety (90) days
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opportunity to cure. If the breach is not cured within the
ninety (90) day period after notice from PIZZA TIME, this
Agreement shall automatically terminate subject to DFC's
rights to sell off the Licensed Product as provided
therein. If the breach is cured within the ninety (90) day
period, this Agreement shall continue in full force and
effect.
4.3 In the event PIZZA TIME breaches any of the provisions of
Sections 8.1, 8.3 and 14, the parties agree that DFC may,
in its sole discretion, provide PIZZA TIME with ninety
(90) days written notice of termination and opportunity to
cure. If the breach is not cured within the ninety (90)
day period, this Agreement shall automatically terminate
subject to DFC's rights to sell off the Licensed Products
as provided herein. If the breach is cured within the
ninety (90) day period, this Agreement shall continue in
full force and effect; provided, however, in the event
PIZZA TIME breaches the same provision twice within any
one (1) year period, DFC may terminate this Agreement
following the second breach without any opportunity to
cure.
4.4 In the event for any given calendar year after the third
full year of the license, DFC does not pay to PIZZA TIME
royalties of at least $50,000, then PIZZA TIME has the
option to convent this license to a non-exclusive license,
all other terms remaining the same.
4.5 In the event either party becomes insolvent; files or has
filed against it involuntarily a petition under the United
States Bankruptcy Code or under or pursuant to any state
bankruptcy act or under any similar Federal or state law;
makes a general assignment for the benefit of creditors;
admits in writing its inability to pay its debts generally
as they become due; or suspends or terminates its
operations or liquidates or dissolves, then, without
limitation, this Agreement shall automatically terminate.
5. Effects Of Termination
5.1 Immediately upon the expiration or termination of this
Agreement, DFC shall cease all use of Trademarks; provided
however, the parties agree that DFC shall have up to one
hundred eighty (180) days to sell existing inventories and
use existing packaging and/or findings of Licensed
products on DFC's normal terms and conditions. The parties
further agree that
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PIZZA TIME may, in its sole discretion, purchase all or a
portion of Licensed Products, or any component thereof, at
DFC's actual cost.
5.2 Within a reasonable period of time following expiration or
termination, but in no event more than four (4) months
following expiration or termination, DFC agrees to provide
to PIZZA TIME a final royalty report and royalty payment.
6. Quality Assurance
6.1 DFC agrees to provide for the opportunity and allow, at
mutually convenient times, PIZZA TIME quality assurance
personnel, or their designated representatives, to inspect
and approve all facilities that supply ingredients or
packaging for Licensed Products or at which Licensed
Products are going to be Manufactured or stored prior to
the initial manufacture and on a semiannual basis
thereafter; provided, however, in the event Licensed
Products at anytime fail to comply with the provisions set
forth in Sections 7.2 and 7.3 PIZZA TIME shall have the
right to have a representative present at its own expense
for all production runs of all Licensed Products at the
facility(s) that produce the substandard product(s) until
all defects are resolved to PIZZA TIME's satisfaction.
PIZZA TIME agrees to provide DFC with reasonable prior
notice of such inspections.
6.2 DFC agrees to correct any reasonable defects that affects
the quality of Licensed Products noted by PIZZA TIME's
quality assurance personnel and provide PIZZA TIME with a
written response detailing the actions taken to correct
such defects within thirty (30) days after such
observations were made by PIZZA TIME's representative.
7. Quality Control
7.1 DFC acknowledges the valuable goodwill, associated with
Trademarks and desires to maintain the validity of
Trademarks and the goodwill associated therewith and DFC
agrees, therefore, to maintain high standards in the
manufacturing, packaging and storing of Licensed Products.
7.2 DFC agrees that Licensed Products shall be
manufactured, packaged, stored, distributed and
marketed in accordance with all applicable Federal,
state and/or local laws and regulations. DFC further
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agrees that all facilities utilized to manufacture and
package Licensed Products shall be maintained in
accordance with all applicable Federal, state and/or local
laws and regulations.
7.3 DFC agrees that Licensed Products shall be manufactured
and packaged in strict accordance with the formulas,
product specifications, quality specifications and samples
approved by PIZZA TIME prior to the initial manufacture.
In the event Licensed Products are not manufactured and
packaged in accordance with such formulas, specifications
and samples, PIZZA TIME shall have the right to terminate
this agreement pursuant to Section 4.2. Additionally,
PIZZA TIME shall have the right to require immediate
corrective action place on any Licensed Products not
meeting such formulas, specifications and/or samples. In
the event DFC desires to make any changes to the formulas
or specifications for Licensed Products, DFC shall provide
PIZZA TIME with revised formulas, product and quality
specifications and samples for PIZZA TIME approval prior
to the manufacture of the revised Licensed Products, PIZZA
TIME shall approve or object revisions within three (3)
business days following PIZZA TIME's receipt of materials
or approval shall be presumed. DFC agrees not to
manufacture revised Licensed Products without PIZZA TIME's
prior consent.
7.4 DFC agrees to provide PIZZA TIME with a sample of all
Licensed Products upon request from PIZZA TIME. DFC
further agrees to make, within a period of two (2) months,
any reasonable changes requested by PIZZA TIME which PIZZA
TIME deems necessary to maintain the quality of Licensed
Products.
7.5 DFC shall allow PIZZA TIME to inspect a copy of all
quality control manuals and records which relate to the
manufacture, packaging or storage of Licensed Products.
DFC agrees to manufacture, package and store Licensed
Products in strict accordance with such manuals.
8. Royalty
8.1 The parties agree that during all terms of this Agreement
DFC shall pay to PIZZA TIME a royalty on net sales in the
amount of four (4%) percent on the first three and
one-half million ($3,500,000) dollars of Net Sales: and
three (3%) percent thereafter.
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8.2 The parties agree that all royalty payments shall be
made by DFC within twenty (20) days following the end
of each month during the term of this Agreement.
9. Advertising/Promotional Materials/Promotion
9.1 DFC shall submit to PIZZA TIME and PIZZA TIME shall
approve prior to use, samples of all materials including,
without limitation, all packaging, labeling, advertising
and promotional materials, that utilize or incorporate
Trademarks in any way. PIZZA TIME shall approve or
communicate any objection of such samples within ten (10)
business days following PIZZA TIME's receipt of such
materials or approval shall be presumed. DFC agrees to
make all reasonable changes requested by PIZZA TIME.
9.2 DFC will promote PIZZA TIME wherever and whenever it can
interconnect its advertising and promotional material for
its Licensed Products including the exclusive right for
promotions with PIZZA TIME in relation to the Licensed
Products, and similarly PIZZA TIME will use its best
efforts to interconnect its promotion and advertising with
DFC's Licensed Products. Both parties, jointly, will use
their respective best efforts to promote the other's
products and services.
9.3 PIZZA TIME will market and promote DFC Licensed Products
in PIZZA TIME's outlets and use its best efforts to
promote and sell DFC Licensed Products. DFC will supply
PIZZA TIME with its products at its standard terms.
10. Trademarks
10.1 DFC agrees that nothing herein shall give DFC any rights,
title or interest in or to Trademarks, accept the right to
utilize Trademarks in accordance with the terms of this
Agreement, and that Trademarks are the sole property of
PIZZA TIME and any goodwill generated from any and all
uses of Trademarks shall inure to the benefit of PIZZA
TIME.
10.2 DFC agrees to assign to PIZZA TIME, on the expiration or
termination of this Agreement and without any additional
consideration, any rights and equities related to
Trademarks and any goodwill incidental to such rights that
may be vested in DFC as a result of the activities of DFC
pursuant to this Agreement.
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10.3 DFC acknowledges the valuable goodwill associated with the
Trademarks and it desires to maintain the validity of the
Trademarks and the goodwill associated with the Trademarks
for the benefit of PIZZA TIME. DFC agrees, therefore, to
utilize Trade-marks in strict accordance with proper
Trademark usage and the directions of PIZZA TIME. DFC
shall not, directly or indirectly, attach or assist a
third party in attacking the validity of Trademarks.
10.4 DFC agrees not to act, directly or indirectly, in any
matter which might lead a third party to believe that
Trademarks are owned by DFC.
10.5 On the packaging, labels, advertising and other
materials which utilize Trademarks, DFC agrees that;
(a) The registered trademark symbol "(R)" shall be
utilized in conjunction with the appropriately
registered Trademarks; or
(b) The trademark symbol "TM" shall be used in
conjunction with unregistered trademarks and
trademarks used outside the scope of their
current registrations.
10.6 DFC agrees not to seek any trademark registration
anywhere in connection with its use of Trademarks.
10.7 DFC agrees not to adopt or use any xxxx or symbol
that is similar to Trademarks or any of PIZZA TIME
trademarks or tradenames.
10.8 DFC agrees not to utilize Trademarks in any
unauthorized manner.
10.9 DFC agrees upon the request of and at the expense of PIZZA
TIME, to reasonably aid and assist PIZZA TIME in the
registration and maintenance of Trademarks and in any
litigation of resolution of claims with respect to
Trademarks.
10.10 DFC shall have no right to expand the scope of protection
afforded the Trademarks. DFC shall use the Trademarks as
set forth in Exhibit A and shall not use the Trademarks,
including any modified version thereof, in any way.
10.11 DFC agrees to notify PIZZA TIME of any non-PIZZA TIME
trademark or tradenames which are similar in sight,
sound, appearance remaining to Trademarks. DFC
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expressly agrees that it shall take no action with regards
to such trademarks or tradenames other than notification
of PIZZA TIME. PIZZA TIME shall have the sole right to
decide whether or not to take action against such
trademarks or tradenames.
11. The Delicious Frookie Company Inc. Trademark Protection
11.1 PIZZA TIME agrees that nothing herein shall give PIZZA
TIME any right, title or interest in or to any of DFC's
trademarks, except the right to utilize such trademarks in
accordance with DFC's instructions of packages of Licensed
Products, and that such trademarks are the sole property
of DFC and any goodwill generated from any and all uses of
such trademarks shall inure to the benefit of PIZZA TIME.
11.2 PIZZA TIME agrees to assign to DFC, on the expiration or
termination of this Agreement and without any additional
consideration, any rights and equities related to DFC's
trademarks and any goodwill incidental to such rights that
may be vested in PIZZA TIME as a result of the activities
of PIZZA TIME pursuant to this Agreement.
11.3 PIZZA TIME acknowledges the valuable goodwill associated
with the DFC trademarks and it desires to maintain the
validity of such trademarks and the goodwill associated
with such trademarks for the benefit of DFC. PIZZA TIME
agrees, therefore, to utilize such trademarks in strict
accordance with proper trademark usage and the directions
of DFC. PIZZA TIME shall not, directly or indirectly,
attach or assist a third party in attacking the validity
of DFC's trademarks.
11.4 PIZZA TIME agrees not to act, directly or indirectly, in
any matter which might lead a third party to believe that
DFC's trademarks are owned by PIZZA TIME.
11.5 PIZZA TIME agrees not to seek any trademark
registration anywhere in connection with its use of
DFC's trademarks.
11.6 PIZZA TIME agrees not to adopt or use any xxxx or
symbol that is similar to DFC's trademarks.
11.7 PIZZA TIME agrees not to utilize DFC's trademarks in
any unauthorized manner.
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11.8 PIZZA TIME agrees upon the request of and at the
expense of DFC, to reasonably aid and assist DFC in
the registration and maintenance of DFC's trademarks
and in any litigation or resolution of claims with
respect to such trademarks.
12. Representations and Warranties of DFC
DFC hereby makes the following representations and warranties:
12.1 The making of this Agreement does not violate any
rights or obligations existing between DFC and any
third party; and
12.2 Licensed Products shall not be adulterated or misbranded
within the meaning of any local, state or Federal law,
regulation, ordinance, rule or procedures and shall not be
a product which may not be sold in interstate commerce
pursuant to the Food, Drug and Cosmetic Act, as amended;
and
12.3 Licensed Products shall be in compliance with all
local, state and Federal laws, regulations,
ordinances, rules and procedures; and
12.4 Licensed Products shall be in strict compliance with
all formulas, specifications and samples.
13. Representations and Warranties of PIZZA TIME
PIZZA TIME hereby makes the following representations and
warranties
13.1 The making of this Agreement does not violate any
rights or obligations existing between PIZZA TIME and
any third party; and
13.2 PIZZA TIME has the right to grant the license of
Licensed Trademarks in accordance with the terms and
conditions of this Agreement.
13.3 The Licensed Trademarks are all valid and subsisting
in the Territory and PIZZA TIME is the owner of the
Licensed Trademarks.
14. Indemnification
14.1 DFC hereby indemnifies and holds harmless PIZZA TIME, and
will defend or cause PIZZA TIME to be defended, from and
against any and all claims, demands, causes of action,
losses, damages, costs and expenses
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(including reasonable attorneys' fees) arising out of or
in any way connected with a breach by DFC of any of the
representations or warranties set forth in Section 12
above or arising from or in any way connected with the
intentional acts or omissions or negligence of DFC or
arising from or in any way connected with DFC's failure to
perform or failure to perform properly any of its
contractual obligations.
14.2 DFC hereby indemnifies and holds harmless PIZZA TIME, and
will defend or cause PIZZA TIME to be defended, from and
against any and all claims, demands, causes of action,
losses, damages, costs and expenses (including reasonable
attorneys' fees) arising out of or in any way connected
with any defect in Licensed Products.
14.3 PIZZA TIME hereby indemnifies and holds harmless DFC and
will defend or cause DFC to be defended, from and against,
any and all claims, demands, causes of action, losses,
damages, costs and expenses (including reasonable
attorneys' fees) arising out of or in any way connected
with PIZZA TIME breach of any of its representations or
warranties set forth in Section 13 above or arising out of
or in any way connected with PIZZA TIME intentional acts
or omissions or negligence or arising out of or in any way
connected with PIZZA TIME failure to perform or failure to
perform properly any of its contractual obligations.
15. Insurance
15.1 At all times during the term(s) of this Agreement and for
at least one (1) year following the expiration or
termination of this Agreement, DFC shall provide to PIZZA
TIME documents evidencing the existence of Comprehensive
General Liability Insurance with combined single limits of
not less than $1,000,000 per occurrence per property
damage and bodily injury. This insurance shall include the
following coverages:
(a) Contractual Liability covering the indemnity
provisions contained in this Agreement; and
(b) Products Liability, including completed
operations, covering all Licensed Products
manufactured pursuant to this Agreement.
15.2 DFC agrees to make certain that there is carried at all
times during the term(s) of this Agreement workmen's
compensation insurance in accordance with
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the statutory limits required by the state in which
Licensed Products are manufactured.
15.3 The insurance policies required by this Section shall
provide that all such policies may not be canceled or the
coverage changed in any material way without at least
thirty (30) days written notice to PIZZA TIME.
16. Product Recovery
PIZZA TIME and DFC may mutually determine whether or not to implement
product recall recovery or retrieval relating to Licensed Products. DFC
agrees to carry out, in accordance with the procedures mutually agreed
upon by the parties, all product recalls, recoveries and retrievals for
Licensed Products and shall bear all costs and expenses associated
therewith, unless such product recall, recovery or retrieval is due
solely to a defect traced to PIZZA TIME in which case PIZZA TIME shall
bear all costs and expenses associated therewith.
17. Records
17.1 DFC agrees to retain and maintain all records relating to
Licensed Products, including, but not limited to,
production records, quality control records, records
relating to the type and cost of advertising Licensed
Products, records relating to the sales (gross and net)
and other transfers of Licensed Products, and all other
related records for a period of at least three (3) years
following the date for which those records apply.
17.2 DFC agrees that a CPA selected by PIZZA TIME shall be
given access to and shall have the right to inspect all
such records, on a confidential basis at any time during
DFC's normal business hours; provided, however, PIZZA TIME
agrees to provide DFC with reasonable prior notice of such
inspection. PIZZA TIME and its CPA shall agree in writing
to maintain all confidential material in confidence.
18. Force Majeure
Either party's failure to perform the terms and conditions of this
Agreement, in whole or in part, shall not be deemed a breach or default
hereunder or give rise to any liability of either party to the other if
such failure is attributable to any act of God, riot, public enemy,
fire, explosion, flood, drought, war, sabotage, accident, action by
governmental authority or any other conditions beyond the reasonable
control of the party.
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19. Relationship of Parties
This Agreement is not intended and shall not, be construed to
constitute either party the joint venture or franchising partner,
agent, or legal representative of the other, and neither party shall
have any authority, expressed, implied, or apparent, to assume or
create any obligations on behalf of or in the name of the other party.
20. Severability
The provisions of this Agreement shall be severable and the invalidity
of any provision, or portion thereof, shall not affect the
enforceability of the remaining provisions of this Agreement.
21. Waiver
Failure of any party hereto to enforce any of the provisions of this
Agreement, or any rights with respect thereto, or failure to exercise
any election provided for herein, shall in no way constitute a waiver
of such provisions, rights, or elections, or in any way affect the
validity of this Agreement. Failure of any party hereto to enforce any
of said provisions, rights, or elections shall not prejudice such party
from later enforcing or exercising some or any other provisions, rights
or elections which it may have under this Agreement.
22. Notice
Any notice required or permitted under this Agreement shall be deemed
to have been received within two (2) business days after written notice
shall be deposited, first class, postage prepaid, in the United States
mail addressed to the respective parties as set forth below or to such
address as each party may hereafter designate by written notice to the
other party:
To PIZZA TIME: Showbiz Pizza Time, Inc.
0000 Xxxx Xxxxxxx Xxxxxxx
Xxxxxx, Xxxxx 00000
or
P. O. Xxx 00000
Xxxxxx, Xxxxx 00000
Attention: Xxxxxxx Xxxxxx
Executive Vice President,
Director of Marketing
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To DFC: The Delicious Frookie Company, Inc.
0000 Xxxxx Xxxx
Xxx Xxxxxxx, XX 00000
Attn: President
With a copy sent to:
Xx. Xxxxxx Xxxxxx
Stoll, Miskin, Previto & Xxxxxxx
000 0xx Xxxxxx
Xxxxxx Xxxxx Xxxxxxxx
Xxxxx 0000
Xxx Xxxx, XX 00000
23. Complete Agreement: Modification
This instrument sets forth the entire agreement between the parties
relative to the subject matter herein. Modification or amendment of any
of the provisions of this Agreement shall not be valid unless in
writing and signed by the parties hereto.
24. Governing Law
This Agreement shall be governed by and construed in accordance with
laws of the state of Illinois.
25. Confidentiality
Simultaneous with the execution of this Agreement, the parties shall
enter into the Non-disclosure Agreement attached hereto and
incorporated herein. The parties agree that neither the term of this
Agreement nor of any activity leading up to the execution of this
Agreement shall be disclosed by either party to any third party without
the prior written consent of the other party.
26. Assignment
This Agreement shall inure to the benefit of and, shall bind each of
the parties hereto and their respective successors and assigns.
IN WITNESS WHEREOF, authorized representatives of the parties hereto have
executed this Agreement effective the day and year first above written.
THE DELICIOUS FROOKIE COMPANY, INC. SHOWBIZ PIZZA TIME, INC.
By:/s/ Xxxxxxx Xxxxx By:
Print Name:Xxxxxxx Xxxxx Print Name:
Title:Chairman of the Board Title:
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EXHIBIT A
TRADEMARKS
"XXXXX X. CHEESE"
Associated characters, including but not limited to:
Charlie Rocket
Pasqually - The Pizza Man
Munch
Xxxxx Xxxxx -
Cute Looking Rat
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