EXCLUSIVE DOMESTIC LICENSE AGREEMENT BHPC.12
THIS AGREEMENT is made and entered into this 14th day of December, 1995 by
and between BHPC Marketing, Inc., a corporation duly organized and existing
under the laws of California, having its principal place of business at 000
Xxxx 000xx Xxxxxx, Xxxxxxx, Xxxxxxxxxx 00000 (hereinafter referred to as
"LICENSOR"), and I. C. Xxxxxx & Co., L.P., a Delaware Limited Partnership,
having its principal place of business at 0000 Xxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxx, 00000 (hereinafter referred to as "LICENSEE").
WHEREAS, LICENSOR is the owner with the right to grant licenses of the
Trademarks illustrated in Exhibit "A" attached hereto (the "Trademarks"); and
WHEREAS, LICENSEE is desirous of obtaining the exclusive right to use
the aforesaid Trademarks in connection with the import or manufacture and
sale of certain licensed products defined herein.
NOW, THEREFORE, it is agreed by the parties as follows:
1. DEFINITIONS
The following terms shall have meanings as set forth below:
a. "Trademarks" shall mean the Trademarks set forth in Exhibit "A", and
any such variations as LICENSEE develops with LICENSOR's prior written
approval.
b. "Territory" shall mean that geographical area defined in item 1 of the
attached License Agreement Detail Schedule.
c. "Licensed Product" shall be defined as set forth in item 2 of the
attached License Agreement Detail Schedule.
d. *
2. RIGHTS GRANTED
LICENSOR hereby grants to LICENSEE, upon the terms and conditions set
forth herein, an exclusive, personal, non-transferable, non- assignable
license, without the right to grant sublicenses, to use the Trademarks
solely on or in conjunction with the design, manufacture, import,
distribution, advertising, promotion, shipment, and sale of the
Licensed Product in the Territory. This license is extended to and
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
BHPC.12
includes wholesale sales only and does not include retail sales.
3. *
4. GOOD WILL AND PROMOTIONAL VALUE
a. LICENSEE recognizes the value of the good will associated with the
Trademarks and acknowledges that the Trademarks, and all rights therein
and the good will pertaining thereto, belong exclusively to LICENSOR.
LICENSEE further recognizes and acknowledges that the Trademarks have
acquired secondary meaning in the mind of the public.
b. LICENSEE agrees that its use of the Trademarks shall inure to the
benefit of LICENSOR and that LICENSEE shall not, at any time, acquire
any rights in the Trademarks by virtue of any use it may make of the
Trademarks.
c. LICENSEE acknowledges that LICENSOR is entering into this Agreement not
only in consideration of the royalties paid hereunder but also for the
good will and promotional value to be secured by LICENSOR for the
Trademarks as a result of the manufacture, offering for sale, sale,
advertising, promotion, shipment and distribution of the Licensed
Product by LICENSEE.
5. *
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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*
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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*
d. LICENSEE agrees that the Licensed Product and all Promotional and
Packaging Material shall contain only those proprietary legends,
markings and/or notices as reasonably required from time to time by
LICENSOR to give appropriate notice to the consuming public of
LICENSOR's right, title and interest thereto. The form of such legends,
markings and notices shall be as described in "Exhibit A" attached
hereto, unless the parties agree otherwise.
e. LICENSOR may, periodically and from time to time during the term of
this Agreement, at reasonable intervals, require that LICENSEE submit
to LICENSOR, at no cost to LICENSOR, or LICENSOR or its designees may
randomly select and retain during the inspection referred to in
Xxxxxxxxxxxx 0x, xxxxx, one (1) additional set of Production Samples of
the Licensed Product and/or the Promotional and Packaging Material
relating to the Licensed Product for subsequent review and written
approval of trademark usage and notice on same. LICENSOR will promptly
advise LICENSEE of any concerns regarding trademark
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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usage and notice, and the parties will cooperate in good faith to
resolve the concerns.
f. *
g. *
6. ADVERTISING/USE OF THE TRADEMARK
a. LICENSEE will adopt and carry out its own marketing and advertising
program with respect to the Licensed Product. LICENSEE agrees that
LICENSEE's advertising, public relations and sales promotion activities
will be subject to prior consultation with, and written approval by,
LICENSOR as to the general form and content only with respect to the
use of the Trademarks and other notices.
b. *
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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c. Subject to Licensed Product availability at the time of the
request, LICENSEE agrees that upon request of LICENSOR, and at
LICENSOR's cost for shipping, delivery and insurance, it shall loan a
reasonable number of Licensed Products to LICENSOR and its other
licensees for advertising and promotional purposes. LICENSEE shall
receive the same benefit from other licensees of LICENSOR. Said
products shall be returned to LICENSEE in the original condition.
d. *
e. Advertising directed to the public may not feature the name of
LICENSEE. If approved, advertising directed to the trade may feature
the following: BHPC Marketing, Inc. under Trademark License to (Name of
LICENSEE).
f. LICENSEE agrees that the Trademark will appear on each Licensed
Product and its packaging, if any. LICENSEE shall use only those tags,
labels and packaging materials which have been previously approved in
writing. All tags, labels and packaging materials bearing the Trademark
must be submitted on the "Advertising Approval Form" (Exhibit "B-3").
g. LICENSEE shall affix such legends, markings and notices on all
License Product as are required by LICENSOR under Subparagraph 5.d. and
the law.
h. LICENSEE must submit for approval to LICENSOR a printer's proof of
each advertising and promotional item before final printing.
7. DURATION OF THE AGREEMENT
a. This Agreement shall continue for three (3) consecutive Contract
Years in respective durations as set forth in item 3 of the attached
License Agreement Detail Schedule (hereinafter collectively the
"Initial Term") and shall then expire unless sooner terminated in
accordance with the terms and conditions set forth herein.
b. If LICENSEE is not in breach of this Agreement at the time renewal
notice is given to LICENSOR, LICENSEE shall have three (3) consecutive
options to renew this Agreement for three (3) consecutive contract
periods, i.e. Contract Years, of one (1) year each (hereinafter
collectively the "Renewal Term"). In order to exercise each individual
option, LICENSEE must provide LICENSOR with written notice of its
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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intention to exercise each respective option and such written notice
must be received by LICENSOR no later than * prior to the expiration of
the Initial Term or immediately preceding Contract Year of the Renewal
Term. * Except as specifically set forth herein to the contrary,
LICENSEE's performance in the Renewal Term shall be pursuant to the same
terms and conditions recited herein for the Initial Term.
8. ROYALTIES
a. "Royalty", as used in this Agreement, shall consist of the sum of
the following:
(i) LICENSEE agrees to pay LICENSOR, during the term of this
Agreement, a Royalty in an amount equal to five percent (5%) of the Net
Shipments by LICENSEE for Licensed Product sold under the Trademarks;
and
(ii) LICENSEE agrees to expend during the term of this Agreement,
an amount equal to one percent (1%) of the Net Shipments by LICENSEE
for Licensed Product sold under the Trademarks in advertising of the
Licensed Product and Trademarks. *
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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*
e. LICENSEE shall keep complete, detailed and accurate records of all
Promotional and Off-priced Merchandise sales, which records shall be
available to LICENSOR for inspection at LICENSEE's premises during
regular business hours.
f. *
9. PAYMENT
*
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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*
b. LICENSEE's statements and all amounts payable to LICENSOR by
LICENSEE shall be submitted to:
BHPC Marketing, Inc.
000 Xxxx 000xx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn: Royalty Receivables Department
c. *
d. All payments made hereunder shall be in United States currency or
checks drawn on a United States bank.
e. *
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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*
10. GUARANTEES
a. Guaranteed Annual Royalty Payments - LICENSEE shall pay, for each
Contract Year during the term of this Agreement, beginning with the
First Contract Year, the respective Guaranteed Annual Royalty Payments
set forth in item 7 of the attached License Agreement Detail Schedule.
b. Guaranteed Target Net Shipments - If, in any Contract Year,
LICENSEE does not achieve the Guaranteed Target Net Shipment Volume
figure set forth in item 7 of the attached License Agreement Detail
Schedule LICENSOR may, at its option, immediately thereafter terminate
this Agreement in writing by giving LICENSEE written notice not later
than * after the end of the Contract Year.
c. Guaranteed Net Shipments - If, in any Contract Year, LICENSEE does
not achieve the Guaranteed Net Shipments figure set forth
in item 7 of the attached License Agreement Detail Schedule LICENSOR
may, at its option, immediately thereafter terminate this Agreement in
writing by giving LICENSEE written notice not later than *
after the end of the Contract Year.
d. *
e. *
f. *
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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*
11. EXPLOITATION BY LICENSEE
a. LICENSEE agrees to commence, and diligently continue thereafter, the
distribution, shipment and sale of each category of the Licensed Product in
commercially reasonable quantities in the Territory on or before the
respective distribution date set forth next to each category of the
Licensed Product described in item 2 of the attached License Agreement
Detail Schedule.
b. LICENSEE agrees that the Licensed Product will be sold, shipped and
distributed outright, at a competitive price determined by LICENSEE, and
not on an approval, tie-in, consignment, or "sale or return" basis.
LICENSEE further agrees that the Licensed Product will only be knowingly
sold to retailers, jobbers, wholesalers and distributors for sale,
shipment and distribution to retail stores and merchants commonly
considered and referred to in the industry as moderate or better
department stores and specialty stores for sale, shipment and
distribution direct to the public. Notwithstanding the foregoing to the
contrary, LICENSOR agrees that the Licensed Product may also be sold to
those retail stores commonly considered and referred to in the industry
as "Warehouse Clubs" * so long as the total Net Shipment volume of
Licensed Product sold to such "Warehouse Clubs" does not exceed twenty
five percent (25%) of LICENSEE's annual Net Shipment volume. * The
manner and scope of the distribution of the Licensed Product,
availability, variety, fabrication, colors and sizes are critical to the
promotion, enhancement and protection of the Trademarks and their
associated goodwill. *
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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c. *
12. *
a. *
b. *
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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*
13. INSURANCE
LICENSEE shall, throughout the term of this Agreement, obtain and maintain
at its own cost and expense from a qualified insurance company acceptable
to LICENSOR, a policy or policies of insurance, insuring against those
risks customarily insured against under broad form comprehensive general
liability policies arising out of any defects or failure to perform,
alleged or otherwise, of the Licensed Product or any use thereof, including
"product liability", "completed operations", "advertisers' liability
insurance", etc and any liability of LICENSEE arising out of Paragraph 20,
below. *
The policies shall provide for ten (10) days notice to LICENSOR from the
insurer by Registered or Certified Mail, return receipt requested, in the
event of any modification, cancellation or termination. LICENSEE agrees to
furnish LICENSOR a certificate of insurance or copy of the policies
evidencing same within thirty (30) days after execution of this Agreement
and from time to time as requested by LICENSOR within ten
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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(10) days of LICENSOR's request; in no event, shall LICENSEE manufacture,
offer for sale, sell, advertise, promote, ship and/or distribute the
Licensed Product prior to receipt by LICENSOR of such evidence of
insurance. If LICENSEE fails to procure, maintain and/or pay for at the
times and for the durations specified in this Agreement, the insurance
required hereunder, or fails to carry insurance required by any
governmental requirement, LICENSOR may (but without obligation to do so),
and without notice to LICENSEE, perform such obligations on behalf of
LICENSEE, and the cost thereof, together with interest thereon at the
maximum rate allowed by law, shall immediately become due and payable to
LICENSOR.
14. USE, DISPLAY, AND SALE INVOLVING THE TRADEMARKS AND COPYRIGHT
a. In order to protect the Trademarks and LICENSOR's reputation, LICENSEE will
manufacture, distribute and sell the Licensed Product in compliance with
all applicable laws. *
b. *
c. LICENSEE shall exercise reasonable efforts, within the limits allowed by
the laws and governmental regulations in effect in the Territory, to ensure
that its merchandising and sale of the Licensed Product shall conform to
policies and methods suitable for goods of high quality sold under a
prestigious label of worldwide repute.
15. OWNERSHIP OF THE TRADEMARKS
a. LICENSEE agrees that nothing in this Agreement shall give LICENSEE any
right, title, or interest in the
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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Trademarks other that the license to use the Trademarks on the Licensed
Product; that such marks are the sole property of LICENSOR; that all such
uses by LICENSEE of such marks shall inure only to the benefit of LICENSOR;
and it being understood that all right, title and interest relating thereto
are expressly reserved by the LICENSOR except for the rights being licensed
hereunder.
b. LICENSEE recognizes that LICENSOR may already have entered into license
agreements with respect to the Trademarks for products which fall into the
same general product category as the Licensed Product, but which are not
sold to the same retail store departments as the Licensed Product, and
which may be similar to, but not the same as, the Licensed Product in terms
of function, or otherwise. LICENSOR will advise LICENSEE of the specifics
of each such agreement. LICENSEE hereby expressly concedes that the
existence of said licenses does not and shall not constitute a breach of
this Agreement by the LICENSOR. Nothing herein shall permit LICENSOR to
license a retail outlet directly to make Licensed Products or products
substantially similar thereto, it being understood that any such products
to be sold by the retail outlet must be purchased from LICENSEE.
c. *
d. *
16. COMPLIANCE WITH LIMITATIONS ON USE OF TRADEMARKS
LICENSEE agrees that the Licensed Product, and all labels, hang tags,
packaging and other trade dress, used in connection with such Licensed
Products, shall not violate any restrictions on use or display of the marks
as provided in that Settlement Agreement and Consent Judgement with Polo
Fashions, Inc., a copy of which
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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is attached hereto as Exhibit "D". Nothing contained in this
Agreement makes Polo Fashions, Inc., or any related company,
a third party beneficiary of this Agreement. *
17. *
18. ASSIGNABILITY AND MANUFACTURING
a. The license granted hereunder is, and shall remain, personal
to LICENSEE and shall not be granted, assigned, or otherwise
conveyed by any act of LICENSEE or by operation of law. For
the purposes of this Paragraph 18, any sale or transfer of any
ownership interest in LICENSEE shall constitute a prohibited
assignment of the license granted hereunder. LICENSEE shall
have no right to grant any sublicenses without LICENSOR'S prior
express written approval. Any attempt on the part of LICENSEE
to arrange to sublicense or assign to third parties its right
under this Agreement, shall constitute a material breach of
this Agreement. Nothing herein precludes LICENSEE from
pledging this Agreement as collateral or security for
financing to its primary lenders or hiring third parties to
manufacture, assemble or sell the Licensed
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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Products.
b. LICENSOR shall have the right to assign its rights and
obligations under this Agreement without the approval of
LICENSEE.
19. NO AGENCY, JOINT VENTURE, PARTNERSHIP
The parties hereby agree that no agency, joint venture, or
partnership is created by this Agreement, and that neither
party shall incur any obligation in the name of the other
without the other's prior written consent.
20. *
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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*
21. TERMINATION
a. In addition to the termination rights provided elsewhere in
this Agreement, each party will have the right to terminate
this Agreement in the event that:
*
22. EFFECT OF EXPIRATIONS OR TERMINATION
a. Except for the limited purposes indicated below, upon
expiration or termination of this Agreement, all rights and
licenses granted to LICENSEE hereunder shall immediately
expire, shall forthwith revert to LICENSOR, and LICENSEE shall
immediately cease and desist from using the Trademarks and any
technical information supplied by LICENSOR to LICENSEE
hereunder. To this end, LICENSEE will be
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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deemed to have automatically assigned to LICENSOR, pursuant to
the express provisions of this Agreement, upon such expiration
or termination, the Trademarks, equities, good will, titles,
and other rights in or to the Licensed Product and all
adaptations, compilations, modifications, translations and
versions thereof, and all other trademarks used in connection
therewith (not including any of LICENSEE's trademarks and
logos) which have been or may be obtained by LICENSEE or which
may vest in LICENSEE and which have not already been assigned
to LICENSOR but not including any generic or standard styles,
labels, tags, designs, graphics and the like. LICENSOR may
thereafter, it its sole discretion enter into such
arrangements as it deems desirable, with any other party, for
the manufacture, promotion and sale of the Licensed Product in
the Territory.
b. Any Licensed Products, finished or in progress, shall be
disposed of as follows:
*
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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*
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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*
23. MODIFICATION; WAIVER
No modification of any of the terms or provisions of this Agreement shall
be valid unless contained in a writing signed by the parties. No waiver by
either party of a breach or a default hereunder shall be deemed a waiver by
such party of a subsequent breach or default of a like or similar nature.
Except as otherwise stated in this Agreement, resort by LICENSOR or
LICENSEE to any remedies referred to in this Agreement or arising by reason
of a breach of this Agreement by LICENSEE or LICENSOR shall not be
construed as a waiver by LICENSOR of its right to resort to any and all
other legal and equitable remedies available to LICENSOR or LICENSEE.
24. FORCE MAJEURE
Neither LICENSOR nor LICENSEE shall be liable to each other or be deemed in
breach or default of any obligations contained in this Agreement, for any
delay or failure to perform due to causes beyond its reasonable control,
including but not limited to delay due to the elements, acts of the United
States Government, acts of a foreign government, acts of God, fires,
floods, epidemics, embargoes, riots, strikes, any of the foregoing events
being referred to as a "Force Majeure" condition. In such event, dates for
performance shall be extended for the period of delay resulting from the
Force Majeure condition. The party affected by a Force Majeure condition
shall, as soon as practicable, notify the other party of the nature and
extent of such condition.
25. NOTICE
All notices, approvals, consents, requests, demands, or other
communications to be given to either party in
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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writing may be effected by personal delivery or by depositing the same in
the United States mail, certified and return receipt requested, postage
prepaid. Such communication shall be addressed to LICENSEE and LICENSOR at
their respective addresses as set forth in the preamble above.
26. CONSTRUCTION; VENUE
This Agreement shall be construed in accordance with the laws of
*, and the parties agree that it is executed and delivered in that
state, and any claims arising hereunder shall, at LICENSOR's election,
be prosecuted in the appropriate Court of *.
27. ENTIRE AGREEMENT
This Agreement, contains the entire understanding of the parties and there
are no representations, warranties, promises, or undertakings other than
those contained herein. This Agreement supersedes and cancels all previous
agreements between the parties hereto.
28. *
29. *
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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*
30. *
31. BINDING EFFECT
This Agreement shall be binding on the parties, and their successors and
assigns.
32. *
33. SEVERABILITY
In the event that any term or provision of this Agreement shall for any
reason be held to be invalid, illegal or unenforceable in any respect, such
invalidity or unenforceability shall not affect any other term or provision
and this Agreement shall be interpreted and construed as if such term or
provision, to the extent the same shall have been held to be invalid,
illegal or unenforceable, had never been contained herein.
34. CAPTIONS
The captions used in connection with the paragraphs and subparagraphs of
this Agreement are inserted only for purpose of reference. Such captions
shall not be deemed to govern, limit, modify or in any other manner affect
the scope, meaning or intent of the provisions of this Agreement or any
part thereof nor shall such captions otherwise be given any legal effect.
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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35. INCORPORATION OF EXHIBITS
LICENSOR and LICENSEE acknowledge and agree that the provisions of Exhibits
"A" through "D" attached hereto (the "Exhibits") are integral to this
Agreement and that the provisions of the Exhibits are all hereby
incorporated herein and made a part hereof as if set out in full in this
Agreement.
36. *
37. APPROVALS
All approvals or consents required to be given by one party to the other
under this Agreement shall not be unreasonably withheld or delayed
notwithstanding anything in the Agreement to the contrary.
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
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IN WITNESS WHEREOF, the parties hereto agree that this Agreement shall take
effect as of the date and year first above written above.
LICENSOR: LICENSEE:
BHPC MARKETING, INC., I.C. XXXXXX & CO., L.P.
a California Corporation a Delaware Limited Partnership
BY: /s/ Xxx Xxxxxxxx BY: /s/ Xxxxxx X. Xxxx
-------------------------------- ------------------------------------
Xxx Xxxxxxxx Xxxxx Xxxx
Licensing Director President, C.E.O.
Date: 12/18/95 Date: 12/20/95
---------- ----------
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LICENSE AGREEMENT DETAIL SCHEDULE
1. DEFINITION OF TERRITORY: United States, all its territories and
possessions
2. DEFINITION OF LICENSED PRODUCT: DISTRIBUTION DATE:
------------------------------- ------------------
Men's denim sportswear January 1, 1996
Men's outerwear
Men's woven shirts, excluding dress shirts
Men's knit and woven casual pants and shorts
Men's sweaters
Men's basic and fashion fleece tops and bottoms
Men's overalls and shortalls
Men's knit tops, including t-shirts and polo shirts
Men's swimwear
Men's warm ups
All silk products are excluded from this Definition of
Licensed Product
3. INITIAL TERM: FROM TO
------------- ---- --
First Contract Year: January 1, 1996 December 31, 1996
Second Contract Year: January 1, 1997 December 31, 1997
Third Contract Year: January 1, 1998 December 31, 1998
4. RENEWAL TERM:
-------------
Fourth Contract Year (if any): January 1, 1999 December 31, 1999**
Fifth Contract Year (if any): January 1, 2000 December 31, 2000
Sixth Contract Year (if any): January 1, 2001 December 31, 2001
5. *
6. ROYALTY RATE:
5% of Net Shipments, plus 1% Advertising Royalty, to be spent by Licensee in
Advertising the Licensed Product in the Territory
* Text omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.
