Exhibit 10.21
AGREEMENT
THIS AGREEMENT is entered into this 1st day of August, 1999, by and
between Associated Wholesale Grocers, Inc. ("AWG") and PriceSmart, Inc.
("PriceSmart").
WHEREAS, PriceSmart has pending applications to register the
trademark "PRICEMART" and related marks containing the word "PRICESMART" in
the Principal Register of the U.S. Patent and Trademark Office;
WHEREAS, AWG has filed two Notices of Opposition ("Oppositions"),
Opposition No. 108,749 and Opposition No. 108,828, in the U.S. Patent and
Trademark Office before the Trademark Trial and Appeal Board, contesting
PriceSmart's applications and has obtained extensions of time to file
oppositions to other PriceSmart applications;
WHEREAS, AWG is the registered owner of a federal registration for
the trademark PRICESMART used for retail grocery store services in
International Class 42, Registration No. 1,362,625;
WHEREAS, AWG filed its Opposition because of concerns that the use
of the trademark PRICESMART by PriceSmart could lead to confusion or mistake
among consumers trying to differentiate between PriceSmart's products and
services sold or provided under the trademark PRICESMART and related marks
and AWG's services provided under the trademark PRICEMART;
WHEREAS, PriceSmart denies its use of the trademark PRICESMART or
related marks is likely to cause confusion or mistake; and
WHEREAS, AWG and PriceSmart now desire to resolve, settle, and
compromise the matter at issue in the Oppositions.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledge, AWG and PriceSmart hereby agree
as follows:
1. a. PriceSmart will not use the xxxx PRICESMART or any related
marks containing the word PRICESMART in connection with the sale, or offer
for sale, of any goods or services within AWG's territory of operations
("Territory"), with the limited exception in Xxxxxxxxx 0, xxxxx, Xxxxxxxxx
being defined as follows:
The Territory comprised of the following ten (10) states: Kansas,
Missouri, Arkansas, Oklahoma, Nebraska, Iowa, Texas, Illinois, Tennessee, and
Kentucky.
b. Nothing in this Agreement to the contrary shall in any way
or manner limit or prohibit the use by PriceSmart of the xxxx PRICESMART or
any xxxx containing the word
PRICESMART (unless the other words or designs of the xxxx infringe on other
marks first adopted and used by AWG) on the Internet or any other global
computer network whether within or outside of the Territory, or any national
advertising campaign that cannot reasonably exclude the Territory, and AWG
agrees that such use does not infringe any rights of AWG.
2. PriceSmart may use the xxxx PRICESMART or any xxxx containing the
word PRICESMART (unless the other words or designs of the xxxx infringe on
other marks first adopted and used by AWG) in connection with the services of
airline and cruise ship reservation services, automobile rental services,
vacation packaging services of making travel and lodging arrangements,
reservation for hotels or temporary lodging, and referral services for
vehicle purchasing, financing, leasing, parts supplies and repair services
within the Territory as defined above in Paragraph 1, provided that these
services are not sold or offered for sale on the premises of any supermarket,
grocery store, discount store, supercenter or convenience store, that sells
grocery products. This prohibition is intended to apply to, but not be
limited to, discount stores, supercenters and wholesale clubs, such as
K-Mart, Wal-Mart, Super Target and Sams. Notwithstanding the foregoing, the
parties expressly acknowledge that the services discussed above may be
offered in hotels using the PRICESMART xxxx, notwithstanding the fact that
hotels may carry some grocery products in their lobby shops. Furthermore, the
parties acknowledge that nothing contained in this Agreement shall preclude
PriceSmart from offering the services described in this Paragraph 2 within
the Territory under any xxxx other than PRICESMART unless such other xxxx
infringes on other marks first adopted and used by AWG.
3. AWG shall withdraw its Oppositions to PriceSmart's pending
applications as soon as is practical following the execution of this
Agreement by AWG and PriceSmart filing a joint stipulation of dismissal.
4. AWG will not oppose any other trademark applications, already
filed or filed in the future, for registration of the xxxx PRICESMART or
related marks containing the word PRICESMART (unless the other words or
designs of the xxxx infringe on other marks first adopted and used by AWG).
5. AWG will not bring an action for trademark infringement against
PriceSmart based on PriceSmart's use, or otherwise contest or oppose
PriceSmart's use, outside the Territory, or the limited use in the Territory
pursuant to Paragraphs 1 and 2, above, of the xxxx PRICESMART or
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related marks containing the word PRICESMART (unless the other words or
designs of the xxxx infringe on other marks first adopted and used by AWG).
6. If either party becomes aware of any confusion between AWG's
xxxx PRICESMART and PriceSmart's xxxx PRICESMART or related marks, the parties
will negotiate in good faith in an effort to eliminate any possibility of
further confusion.
7. If AWG becomes aware of any use of the xxxx PRICESMART or related
marks which violates Paragraphs 1 and/or 2 above, AWG will give written
notice to PriceSmart of the improper use. Such improper use is considered a
material breach of this Agreement. PriceSmart will have thirty (30) days to
cure this breach. If PriceSmart fails to cure this breach within thirty (30)
days, AWG may terminate this Agreement and take any further actions deemed
appropriate including, but not limited to, monetary damages, injunctive relief
and seeking cancellation of any or all PRICESMART Registrations.
8. This Agreement is binding upon the parties hereto as well as
their respective affiliates, assigns and successors.
9. This Agreement constitutes the entire agreement between the
parties with respect to the subject mater of this Agreement and replaces any
prior oral or written agreement between the parties involving the same
subject matter.
10. This Agreement may not be modified, altered or changed in any
manner whatsoever except by an instrument in writing executed by the parties.
11. In any legal action between the parties hereto concerning this
Agreement, the prevailing party shall be entitled to recover reasonable
attorneys fees and costs.
IN WITNESS WHEREOF, the parties have executed this Agreement
effective the date first written above.
ASSOCIATED WHOLESALE PRICESMART, INC.
GROCERS, INC
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxx
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Title: President & CEO Title: Senior Vice President
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