EXHIBIT 10.59
TRADEMARK AND INTELLECTUAL PROPERTY LICENSE AGREEMENT
This Trademark and Intellectual Property License Agreement (this
"Agreement") is made and entered into on this 20th day of July, 2001, by Big
Buck Brewery & Steakhouse, Inc., a Michigan corporation, ("Big Buck") and Up
North Adventures, Inc., a Michigan corporation ("Up North").
WITNESSETH:
WHEREAS, Big Buck is the owner of the trademarks, tradenames, service
marks, know how, and other intellectual property listed on the attached EXHIBIT
A as well as the registrations and applications therefor in the forms set forth
in the attached EXHIBIT B (collectively, the "Intellectual Property");
WHEREAS, Up North is owned by Xxxxxx Xxxx, Trustee of the Xxxxxx Xxxx
Revocable Living Trust dated February 20, 2001, Xxxxxx Xxxx, Grantor (the
"Trust"); and
WHEREAS, Big Buck is willing to grant to Up North the right to use the
Intellectual Property, subject to the terms and conditions or this Agreement, so
that Up North may expand the development of the "Big Buck" concept in the
Territory (as defined in Section 2.1), and Up North desires to accept said
right.
NOW, THEREFORE, the parties, in consideration of the mutual agreements
contained in this Agreement, the parties agree as follows:
AGREEMENT:
ARTICLE I
GRANT OF LICENSE
1.1 THE LICENSE. Subject to the terms and limitations set forth in this
Agreement, Big Buck hereby grants to Up North, and Up North hereby accepts, the
exclusive right and license (the "License") to: (i) use and exploit the
Intellectual Property and all later developments to the Intellectual Property
throughout the Territory (as defined in Section 2.1) in connection with Big
Buck's services and products (collectively, the "Products"), (ii) import, sell,
and distribute the Products under the Big Buck name, label, and trademarks,
(iii) open and operate Big Buck restaurants in the Territory at location(s) of
Up North's choice; and (iv) sublicense (or grant franchise rights) to others the
rights granted hereunder.
1.2 EXCLUSIVE LICENSE. Up North's rights under this Agreement shall be
exclusive; provided, however, that in the event Up North shall be in default
under this Agreement and have failed to cure the default within thirty (30) days
after receipt of written notice from Big Buck, then Big Buck may, by written
notice to Up North, declare such rights to be non-exclusive.
1.3 SUBLICENSE; ASSIGNMENT. The grant of the License includes the right
by Up North to grant sublicenses, within the scope of the License, or assign
this Agreement to Xxxxxx Xxxx ("Xxxx"), the Trust, or entities wholly owned or
controlled by Xxxx or the Trust. Except as provided in this Agreement, the
License and Agreement shall be nontransferable and nonassignable without Big
Buck's prior written consent. In the event Up North assigns this Agreement to a
person or entity other than Xxxx, the Trust, or entities wholly owned or
controlled by Xxxx or the Trust, Xxxx shall personally guarantee such person or
entity's obligations under this Agreement.
1.4 REVERSION OF RIGHTS, RETURN OF DOCUMENTS. Upon the termination or
expiration of this Agreement, all rights granted to Up North hereunder shall
automatically revert to Big Buck. In addition, upon Big Buck's written request,
Up North shall, within a reasonable time after the termination or expiration of
this Agreement, return to Big Buck all documents belonging to Big Buck that it
has in its possession.
ARTICLE II
TERRITORY
2.1 TERRITORY DEFINED. "Territory" means the following countries:
Japan, Thailand, Malaysia and Singapore.
ARTICLE III
TERM AND TERMINATION
3.1 TERM. The initial term of this Agreement shall begin on July 20,
2001, and extend for a period of twenty-five (25) years (the "Initial Term").
Upon the expiration of the Initial Term, this Agreement shall automatically
renew for four (4) successive five (5)-year periods (the "Renewal Terms") unless
Up North terminates this Agreement by providing written notice to Big Buck at
least sixty (60) days prior to the end of the then term. The Initial Term and
the Renewal Terms shall be collectively referred to as the "Term."
3.2 TERMINATION. This Agreement may be terminated: (i) by either party
upon thirty (30) - days written notice to other party if the other party has
materially breached this Agreement and has failed to cure such breach within
thirty (30) days after receiving notice from the other party, or (ii) as
otherwise provided in this Agreement.
ARTICLE IV
OWNERSHIP AND USE OF THE INTELLECTUAL PROPERTY
4.1 NO OWNERSHIP RIGHTS. Up North acknowledges that it is not, and will
not become, by virtue of this Agreement the owner of any right, title, or
interest in and to the Intellectual Property in any form or embodiment other
than pursuant to the License granted hereby.
4.2 ADVERSE CLAIMS. Up North agrees that it will do nothing
inconsistent with Big Buck's ownership of the Intellectual Property and will not
claim, or assist any third party in attempting to claim, adversely to Big Buck
with regard to such ownership.
4.3 QUALITY OF PRODUCTS. Up North agrees that the nature and quality of
all Products sampled, sold, or otherwise disposed of by it and covered by the
Intellectual Property shall conform to the standards set by and under Big Buck's
control (the "Quality Standards"). The Quality Standards shall be reasonable and
no greater than the quality standards maintained by Big Buck in its restaurant
operations.
ARTICLE V
AGREEMENTS OF UP NORTH
5.1 BEST EFFORTS. Up North agrees to use commercially reasonable
efforts to promote the Products in the Territory, including displays at major
trade shows and distribution of promotional literature.
5.2 SCOPE OF LICENSE. The License gives Up North the right to promote,
manufacture, distribute, and sell the Products in the Territory. Up North is not
authorized to promote, distribute, or sell the Products outside of the
Territory, unless it obtains Big Buck's prior written consent. Up North will
refer inquiries for the distribution or sale of the Products outside the
Territory to Big Buck for follow up, and Big Buck will refer inquires for sales
inside the Territory to Up North for follow up.
5.3 UPDATES. Periodically, at Big Buck's request and upon reasonable
notice to Up North, Up North will update Big Buck on matters, including, but not
limited to, the following: promotional efforts, sales activity, and brand
performance.
ARTICLE VI
AGREEMENTS OF BIG BUCK
6.1 MARKETING MATERIALS. At Up North's request from time to time and
upon reasonable notice and frequency, Big Buck will provide Up North with a
reasonable number of marketing and promotional literature and materials,
including Product samples, t-shirts, uniforms, and other similar items. Up North
shall reimburse Big Buck for big Buck's actual cost for such items.
6.2 OTHER MATERIALS AND INFORMATION. Big Buck shall provide Up North
with: (i) its beer and food recipes, menus, Product labels, list of suppliers,
training and operations manuals, building guidelines and site/architectural
plans, and (ii) any other materials or information that will assist Up North in
promoting or distributing the Products and establishing Big Buck franchises in
the Territory. Such assistance will include, without limitation, access to Big
Buck's architects and other consultants regarding the construction and design of
the restaurants' physical structure, access to Big Buck's personnel for
reasonable consultation assistance, and access to its suppliers of the Products.
In the event any of the materials or information is updated or modified, Big
Buck shall promptly notify Up North and furnish Up North with the updated or
modified materials or information.
6.3 REGISTRATIONS. Up North will use its best efforts, at its expense,
to obtain the appropriate registrations for all Intellectual Property requiring
registration, including, without limitation, trademark registration for the Big
Buck name, in Japan. In addition, Up North will undertake such registrations in
the other countries of the Territory, on a country-by-country basis, prior to Up
North actually opening a Big Buck franchise in the particular country.
ARTICLE VII
MEETINGS
7.1 REQUESTED MEETINGS. From time to time at either party's request,
but not less than once each year, the parties will meet to determine performance
objectives as well as other mutual concerns. The parties will hold meetings at
least once during each six (6) - month period by telephone for the same
purposes.
ARTICLE VIII
ROYALTIES
8.1 ROYALTY AMOUNT. Upon Up North's opening of a Big Buck restaurant in
the Territory (the "Opening Date"), Up North agrees to pay to Big Buck the
following percentages of royalties (the "Royalties") in consideration for the
rights granted to Up North under this Agreement:
8.1.1 FOR THE FIRST TWENTY-FOUR MONTHS AFTER THE FIRST BIG BUCK
RESTAURANT IS OPENED: One and one half (1 1/2 %) percent of Up North's Gross
Receipts (as defined in Section 8.2 of the Agreement) for the Products sold in
the Territory; and
8.1.2 FOR THE REMAINDER OF THE TERM OF THIS AGREEMENT AFTER THE
EXPIRATION OF THE PERIOD SET FORTH IN SECTION 8.1.1 ABOVE: Two (2 %) percent of
Up North's Gross Receipts for the Products sold in the Territory.
8.2 DEFINITION OF GROSS RECEIPTS. For purposes of this Agreement,
"Gross Receipts" means all cash received by Up North for operations relative to
the Intellectual Property.
8.3 PAYMENT OF ROYALTIES. The Royalties shall be paid within forty-five
(45) business days following each Contract Quarter. A "Contract Quarter" as used
in this Agreement means each successive period of three (3) calendar months
beginning on the first day of the calendar month following the Opening Date.
With each Royalty payment, Up North shall render to Big Buck a royalty statement
showing Up North's gross receipts such information shall be needed to compute
the Royalties.
8.4 REMITTANCES IN U.S. DOLLARS. All remittances under this
Agreement shall be made in United States Dollars, with exchange being made at
the exchange rate prevailing on the date of remittance.
8.5 AUDIT RIGHT. Big Buck and/or its agents will have the right to
review Up North's books and records, on reasonable notice are during normal
business hours to verify the amounts of any Royalties owed and paid (the "Audit
Right"). This Audit Right shall be an annual right, exercisable one time per
each twelve (12) month period of the term. The costs incurred in connection with
Big Buck's exercise of the Audit Right shall be paid by Big Buck. If, with
respect to any royalty period, the audit reveals an understatement in the
Royalties due of the greater of Five Thousand United States ($5,000.00) Dollars
or ten (10%) percent, however, Up North will then bear Big Buck's reasonable
costs incurred in the audit, not to exceed the lesser of Ten Thousand United
States ($10,000.00) Dollars or the amount of the shortfall.
8.6 ATTORNEY FEES. Upon execution of this Agreement and upon approval
of Big Buck's lender, Xxxxx County Employees' Retirement System ("WCERS"), Up
North shall pay to Big Buck the sum of One Thousand Five Hundred ($1,500.00)
Dollars to cover Big Buck's legal costs incurred in reviewing and negotiating
this Agreement
ARTICLE IX
REPRESENTATIONS AND WARRANTIES
9.1 BY BIG BUCK. Big Buck represents and warrants that: (i) it has good
title to the Intellectual Property; (ii) has the right to grant the License in
accordance with the terms of this Agreement free of any liabilities, charges,
liens, restrictions, or encumbrances of any kind; (iii) there is no claim,
action, proceeding, or other litigation pending or, to Big Buck's knowledge,
threatened with regard to its ownership of the Intellectual Property or which,
if adversely determined, would restrict or otherwise interfere in any material
respect with Up North's exercise of the License; (iv) in the event it grants to
any third party any licenses or rights in the Intellectual Property, it will not
take any action or suffer any omission which would adversely affect the
existence or validity of the Intellectual Property or conflict with the rights
granted to Up North under this Agreement; (v) during the Term, it will not
abandon the Intellectual Property, (vi) it is a Michigan corporation, duly
organized and validly existing under Michigan law, and has the power and
authority to enter into this Agreement and perform all of its
obligations hereunder; and (vii) its execution, delivery, and performance of
this Agreement will not conflict with, violate, or result in a breach of any of
the terms, conditions, or provisions of any law, regulation, order, writ,
judgment, or decree applicable to it.
9.2 BY UP NORTH. Up North represents and warrants that: (i) it is a
Michigan corporation, duly organized and validly existing under Michigan law,
and has the power and authority to enter into this Agreement and perform all of
its obligations hereunder, and (ii) to the best of its knowledge, its execution,
delivery, and performance of this Agreement will not conflict with, violate, or
result in a breach of any of the terms, conditions, or provisions of any law,
regulation, order, writ, judgment, or decree applicable to it.
9.3 SURVIVAL. The parties representations and warranties contained in
this Article 9 will survive the execution and delivery of this Agreement.
ARTICLE X
CONFIDENTIALITY
10.1 CONFIDENTIALITY. Each party shall: (i) keep secret and maintain in
confidence all confidential and proprietary information and data of the other
party disclosed to it in connection with the performance of its obligations
under this Agreement (the "Confidential Information"); (ii) not disclose the
Confidential Information to any party other than its respective agents (e.g.,
employees, attorneys, and consultants) who need to know the Confidential
Information in order to assist Big Buck in fulfilling its obligations under this
Agreement; (iii) not use the Confidential Information for any purpose other than
determining and performing its obligations and exercising its rights under this
Agreement; and (iv) take all reasonable measures necessary to prevent any
unauthorized disclosure of the Confidential Information by any of their
respective agents. Measures taken to protect the Confidential Information shall
be deemed reasonable if the measures taken are at least as strong as the
measures taken by the disclosing party to protect the Confidential Information.
10.2 PERMITTED DISCLOSURE. Nothing in this Agreement shall prevent Big
Buck or Up North or its respective agents from using, disclosing, or authorizing
the disclosure of the Confidential Information it receives and which: (i) has
been published or is in the public domain, or which subsequently comes into the
public domain, through no fault of the receiving party; (ii) prior to receipt
under this Agreement was property within the receiving party's legitimate
possession or, subsequent to receipt under this Agreement, is lawfully received
from a third party having rights therein without restriction of the third
party's right to disseminate the Confidential Information and without notice of
any restriction against its further disclosure; (iii) is independently developed
by the receiving party through persons who have not had, either directly or
indirectly, access to or knowledge of the Confidential Information (iv) is
disclosed to a third party with the written approval of the party originally
disclosing the Confidential Information, provided that the Confidential
Information shall cease to be confidential and proprietary information covered
by this Agreement only to the extent of the disclosure so consented to; or (v)
is required to be produced under order of a court of competent jurisdiction or
other similar requirements of a governmental agency, provided that the
Confidential Information to the extent covered by a protective order or its
equivalent shall otherwise continue to be Confidential Information required to
be held confidential for purpose of this Agreement.
10.3 SURVIVAL. The obligations under Sections 10.1 and 10.2 shall
survive, as to any party, until two (2) years following the date of termination
or expiration of this Agreement, provided that such obligations shall continue
indefinitely with regard to any trade secret or similar information that is
proprietary to a party and provides such party with an advantage over its
competitors.
ARTICLE XI
THIRD-PARTY INFRINGEMENTS
11.1 VIOLATION BY THIRD PARTY. If either party becomes aware of any
product or activity of any third party that involves infringement or violation
of any of the Intellectual Property licensed under this Agreement, it shall
notify the other of such violation in writing within thirty (30) days. Up North
shall then have the right, for a period of sixty (60) days, to commence
litigation to enforce its rights. If Up North does not do so, then Big Buck
shall thereafter have the right to take action directed toward settling the
controversy or restraining or enjoining such infringement at its own expense. Up
North may participate in such action taken by Big Buck at its own expense.
11.2 JOINT COOPERATION. The parties will reasonably cooperate with the
other, at their own reasonable expense, in efforts undertaken by the other to
enforce their respective rights. As part of such cooperation, either party may
join the other in a lawsuit to enforce such rights. The party joining the other
will indemnify the joined party against all expenses of such joinder.
11.3 EXPENSES OF INFRINGEMENT SUIT. If either Up North or Big Buck
elects to bring a suit for infringement, all expenses thereof shall be borne by
the party initiating such suit, and all proceeds, after costs of litigation,
shall be divided equally between Up North and Big Buck.
ARTICLE XII
INDEMNIFICATION
12.1 INDEMNIFICATION BY BIG BUCK. Big Buck agrees to indemnify Up North
against damages and expenses arising from claims of third parties: (i) that Big
Buck does not have the right to grant Up North the rights under this Agreement
with respect to the Products or the Products violate or infringe on the
publicity, privacy or other rights of such third parties, or (ii) resulting from
a breach of its representations and warranties contained in this Agreement.
12.2 INDEMNIFICATION BY UP NORTH. Up North agrees to indemnify Big Buck
against damages and expenses arising from claims of third parties resulting from
a breach of its representations and warranties contained in this Agreement, and
from any action taken by Up North in connection with exploitation of the
Intellectual Property
12.3 DAMAGES WITH REGARD TO THIRD-PARTY CLAIMS. The damages of either
Big Buck or Up North with respect to claims of third parties shall be limited to
amounts required to reasonable costs of defense and amounts to be paid to such
third parties pursuant to settlement or judgment, and not to lost profits or
other amounts incurred.
12.4 DEFENSE OF CLAIM OR ACTION. The party owing a duty of
indemnification shall have the right to control the defense of any claim or
action alleging facts which, if true, would give rise to a duty of
indemnification.
ARTICLE XIII
MISCELLANEOUS
13.1 LENDER APPROVAL. Big Buck's execution of this Agreement is
contingent upon the approval of its lender, WCERS.
13.2 GOVERNING LAW; DISPUTE RESOLUTION. This Agreement will be governed
by the laws of the State of Michigan, United States of America. Any disputes
arising under this Agreement will be settled by binding arbitration in Troy,
Michigan, in accordance with the Commercial Arbitration Rules of the American
Arbitration Association, and judgment on such award may be entered in any court
of competent jurisdiction in the United States or the Territory. Each of the
parties will bear their own costs of arbitration, including attorneys' fees.
13.3 COMPLETE AGREEMENT. This Agreement is the complete and binding
agreement between the parties and supersedes any previous discussions or
writings.
13.4 SEVERABILITY. If any provision of this Agreement is found to be
invalid or illegal, the remainder of this Agreement shall continue to be
enforceable.
13.5 FORCE MAJEURE. Neither party shall be liable for any failure to
perform its obligations under this Agreement, other than the payment of money,
by reason of any event or action beyond its control, including without
limitation, labor stoppage, material shortage or unavailability, war, Act of
God, or casualty to facilities.
13.6 NOTICES. All notices and other communications under this Agreement
shall be in writing and given by hand delivery to the other party or by
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:
IF TO BIG BUCK:
Big Buck Brewery & Steakhouse, Inc.
Attention.: Xxxxxxx X. Xxxxxxxx
000 X. Xxxxxxxxx
X.X. Xxx 0000
Xxxxxxx, Xxxxxxxx 00000
With Copy To:
Honigman, Miller, Xxxxxxxx & Xxxx
Attention: Xxxx Xxxxxx
0000 Xxxxx Xxxxxxxx Xxxxxxxx
Xxxxxxx, Xxxxxxxx 00000
IF TO UP NORTH:
Up North Adventures, Inc.
Attention: Xxxxxx Xxxx
0000 Xxxxxxxxxx Xxxxx, Xxxxx 000
Xxxx, Xxxxxxxx 00000
With Copy To:
Xxxxxxx & Xxxxx, PLLC
Attention: Xxxxxx X. Xxxxx, Xx.
00000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx Xxxxx, Xxxxxxxx 00000
13.7 COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be deemed as original. Said counterparts shall
constitute one and the same instrument.
13.8 HEADINGS. The headings contained in this Agreement are for
reference purposes only and are not intended to describe, interpret, define, or
limit the scope, extent, or intent of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement by their
duly authorized officers or agents as of the day and year first written above.
BIG BUCK BREWERY & STEAKHOUSE, INC.
/s/ Xxxxxxx X. Xxxxxxxx
-----------------------
By Xxxxxxx X. Xxxxxxxx
Its President and Chief Executive Officer
UP NORTH ADVENTURES, INC.
/s/ Xxxxxx Xxxx
---------------
By Xxxxxx Xxxx
Its President
