TRADEMARK LICENSE AGREEMENT
Exhibit 10.32
This TRADEMARK LICENSE AGREEMENT (this “License”) is made as of [•] (the
“Effective Date”), by and between Culligan International Company, a Delaware corporation,
having its principal place of business at 0000 X. Xxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000
(“CULLIGAN”), P1 Sub, LLC, a North Carolina limited liability company and P2 Sub, LLC, a
North Carolina limited liability company (each, a “LICENSEE” and together, the
“LICENSEES”). Capitalized terms used in this License without definition have the meanings
set forth in the Purchase Agreement (as defined below).
RECITALS
X. XXXXXXXX owns the trademark “Culligan”, which is registered in the United States Patent and
Trademark Office, and owns and controls certain other related registered trademarks, trade names,
signs and commercial symbols which are associated with water and the treatment of water. Such
marks and related designations have gained a high degree of consumer acceptance and distinction for
quality and consistency.
B. LICENSEES, CULLIGAN, Culligan Store Solutions, LLC and Culligan of Canada Ltd. have entered
into an Asset Purchase Agreement, dated as of June 1, 2010 (the “Purchase Agreement”),
pursuant to which LICENSEES agreed to acquire certain assets of Culligan Store Solutions, LLC and
Culligan of Canada Ltd. in exchange for cash and common stock of Primo Water Corporation, all as
more fully described in the Purchase Agreement.
C. It is a condition to the Closing under the Purchase Agreement that this Agreement be
executed by the parties and delivered to the LICENSEES on the Closing Date.
NOW, THEREFORE, in consideration of the mutual promises, covenants and conditions set forth
below, the parties agree as follows:
1. LICENSE
1.1 CULLIGAN, as licensor, hereby grants to each LICENSEE during the Term (as defined below)
of this License a non-transferable (except pursuant to Section 7 below), non-exclusive,
royalty-free, fully paid-up right and license to use within the Licensed Territory (as defined
below) the trademarks identified on Attachment A (such trademarks, together with all
registrations and applications therefor and all common law rights pertaining thereto, the
“Marks”) in connection with its ownership and operation of the Purchased Assets which
display or otherwise make use of the Marks as of the Effective Date (the “Licensed
Products”) and the promotion and advertising of the Licensed Products (the “Licensed
Use”).
1.2 Each LICENSEE acknowledges that its rights acquired pursuant to this License are not
exclusive to such LICENSEE and that (a) CULLIGAN and its Affiliates have heretofore entered
into franchise agreements with third-party dealers, pursuant to which such dealers have been
granted the right to produce, distribute or sell products that are the same as or similar to the
Licensed Products using the Marks (the “Existing Licensees”), which rights shall not be
terminated or affected by the sale of the Business to LICENSEES pursuant to the Purchase
Agreement, (b) the Existing Licensees may compete with the LICENSEES in their future
operation of the Business, and (c) CULLIGAN and its Affiliates have heretofore produced,
distributed and sold products and retain the right in the future to use the Marks to produce,
distribute and sell products other than the Licensed Products and to license third parties,
including but not limited to the Existing Licensees to do the same. For the avoidance of doubt,
neither the foregoing nor any other provision of this License shall amend or otherwise diminish the
obligations of CULLIGAN and its Affiliates pursuant to the Non-Competition Agreement.
1.3 The territory in which the LICENSEES are authorized to use the Marks in accordance with
this License consists of the United States and Canada (the “Licensed Territory”).
Notwithstanding the foregoing, the Licensed Use of the Marks by LICENSEES in advertising via the
Internet shall not be deemed a violation of this License merely because such advertisements may be
viewed by persons outside of the Licensed Territory provided that (i) such advertising is not
directed to Persons outside of the Licensed Territory and (ii) the Licensed Products being so
advertised are provided or sold by LICENSEES only in the Licensed Territory.
1.4 CULLIGAN grants no license by implication or otherwise under this License for rights to
any territory except the Licensed Territory, or to any other trademark or designation other than
the Marks, or to other rights with respect to the trademark “Culligan” on any product other than
the Licensed Products or with any use other than the Licensed Use. LICENSEE acknowledges that
CULLIGAN retains all rights and privileges not expressly granted by this License.
2. QUALITY STANDARDS AND CONTROL
2.1 Each LICENSEE covenants that it will ensure that the Licensed Products and
Licensed Use are maintained at a level of a quality at least equal to the quality maintained by
CULLIGAN immediately prior to the Effective Date hereof (the “Quality Standards”).
2.2 All use of the Marks made by each LICENSEE hereunder shall faithfully reproduce
the design and appearance of the Marks as reflected on Exhibit A.
2.3 CULLIGAN shall have the right to inspect and approve any and all uses by each LICENSEE of
the Marks. CULLIGAN hereby approves any and all uses of the Marks by LICENSEES that are consistent
with uses of the Marks by CULLIGAN as of the Effective Date. From time to time, upon CULLIGAN’S
reasonable request in writing, each LICENSEE shall provide CULLIGAN, at LICENSEE’S expense, with
representative samples of the ways in which the Marks are then being used by such LICENSEE (or
photographs depicting the same). CULLIGAN shall be deemed to have approved any use of the Marks if
CULLIGAN does not object to such use within fifteen (15) days of its receipt of representative
samples of such use (or photograph thereof). If CULLIGAN believes that any use by a LICENSEE of
the Marks (other than a use deemed approved pursuant to this Section 2.3) is in violation of the
Quality Standards, CULLIGAN shall provide written notice of such violation to such LICENSEE within
such fifteen (15) day period setting forth specific information regarding the alleged violation.
CULLIGAN and such LICENSEE will cooperate diligently and in good faith thereafter to
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determine whether such a violation has occurred and, if so, LICENSEE shall use reasonably diligent
efforts to cure the cause of such violation or, if such LICENSEE is unable to cure such violation,
discontinue such use.
2.4 Each LICENSEE shall use the Marks only in such manner as will comply with the
provisions of applicable laws and regulations relating to the Marks.
2.5 Each LICENSEE shall maintain any equipment to which a Xxxx is affixed only in such manner
as will comply with all applicable laws and regulations relating to such equipment.
3. VALIDITY OF MARKS; USE OF MARKS
3.1 Each LICENSEE acknowledges the validity of the Marks and CULLIGAN’S common law and other
rights in the Marks and will not question the ownership or validity of same.
3.2 Each LICENSEE will refrain from using the Marks and other trademarks or designations of
CULLIGAN except as authorized in this License.
3.3 Each LICENSEE will refrain from using any other xxxx in any manner that creates a
likelihood of confusion with the Marks.
4. TERM AND TERMINATION PROVISIONS
4.1 The term of this License will commence on the Effective Date and continue in effect for
one year, unless sooner terminated in accordance with the terms hereof (the “Term”).
4.2 Either party may terminate this License if the other party fails to perform a material
obligation under this License and does not cure such failure within twenty (20) days after
receiving written notice from the other party.
4.3 Termination of this License will not relieve CULLIGAN or either LICENSEE of their
respective obligations under Section 6.
4.4 Upon termination of this License LICENSEES shall cease use of the Marks; provided,
however, that after such termination, LICENSEES may continue to use Purchased Assets having
any Xxxx affixed thereto, to the extent that such Purchased Assets are not located in the retail
area of a commercial retailer, without any obligation to remove or obscure such Marks and such
continued use shall not be a violation hereof. Notwithstanding anything to the contrary contained
herein, to the extent required by applicable Law, LICENSEE shall be permitted to refer to the
business acquired pursuant to the Purchase Agreement as the business acquired from Culligan Store
Solutions, LLC and Culligan of Canada Ltd.
5. INDEPENDENT CONTRACTOR
Each LICENSEE is an independent contractor and will itself control and direct the performance
of the details of its operations. This License is not intended to give CULLIGAN
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any significant control over the business operations of any LICENSEE or grant any LICENSEE any
significant assistance from CULLIGAN. CULLIGAN does not prescribe a marketing plan or system, and
the parties do not have a community of interest or continuing financial interest in the marketing
of goods or services. The parties do not intend to create a franchise or sale of a business
opportunity plan as applicable under any state or federal law. No party to this License is
authorized to incur debts or other obligations of any kind on the part of or act as an agent of any
other party hereto.
6. TRADEMARK INFRINGEMENT; INDEMNIFICATION; LIMITATION OF LIABILITY; INSURANCE
6.1 Each LICENSEE shall promptly advise CULLIGAN of any claims of infringement or the
commencement against such LICENSEE of any lawsuit for trademark infringement relating to such
LICENSEE’s use of the Marks. CULLIGAN shall have control over the defense of any such lawsuit. So
long as CULLIGAN is conducting the defense of such claim, neither the LICENSEE nor CULLIGAN will
consent to the entry of any judgment or enter into any settlement with respect to such claim
without the prior written consent of the other party, which consent will not be withheld
unreasonably, it being understood that any party may withhold its consent to a settlement that
provides for non-monetary relief or an admission of liability. Each LICENSEE agrees to assist
CULLIGAN by providing information and witnesses as needed and CULLIGAN shall reimburse such
LICENSEE for its actual expenses incurred in such assistance provided that CULLIGAN has approved
such expenses in advance. Each LICENSEE shall have the right to be represented by its own counsel
at its own expense, which counsel shall act only in an advisory capacity.
6.2 CULLIGAN shall defend, indemnify and hold each LICENSEE, its officers, directors,
managers, employees, agents, and equityholders harmless from and against, and pay and reimburse
such LICENSEE for, any liability, loss or damage, cost or expense, including but not limited to
court costs, attorneys’ fees, and any awards or damages (collectively, “Losses”) directly or
indirectly relating to or arising from (a) such LICENSEE’s use of the Marks, as long as such use is
authorized by this License or (b) CULLIGAN’s breach of any of its warranties or obligations
hereunder.
6.3 Each LICENSEE (jointly and severally) shall defend, indemnify and hold CULLIGAN, its
officers, directors, employees, agents, shareholders, and dealers harmless from and against, and
pay and reimburse CULLIGAN for, Losses directly or indirectly relating to or arising from any
LICENSEE’s breach of its warranties or obligations hereunder, or unauthorized use of the Marks.
6.4 Except as related to the parties’ indemnity obligations as stated in Sections 6.2 and 6.3,
no party will be liable to any other party for indirect, incidental, exemplary or consequential
damages of any nature (including without limitation lost profits) or for special or punitive
damages arising out of or related to this License, whether such damages are based on breach of
contract, breach of warranty, negligence, gross negligence, strict liability or any other legal
theory.
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7. SUBLICENSES; ASSIGNMENT
No LICENSEE will have any right of sublicense without CULLIGAN’S prior written consent, which
consent will be in CULLIGAN’S sole and absolute discretion. Notwithstanding Section 4, if any
LICENSEE attempts to sublicense this License without CULLIGAN’S consent, then this License will
terminate immediately. No party shall assign its rights under this License to any third party,
except (a) either party may assign its rights hereunder to an Affiliate, provided, that
such assignment shall not relieve the assignor of its responsibilities under this License, (b)
CULLIGAN may assign its rights and obligations to a third party pursuant to a merger or sale of
substantially all of its assets and (c) any LICENSEE may collaterally assign its rights hereunder
to its lenders for security purposes. Any purported assignment in violation of the foregoing shall
be null and void and of no effect.
8. GENERAL PROVISIONS
8.1 All notices pertaining to this License will be transmitted in a manner to confirm receipt
to the President of the party at the address of its principal place of business set forth above.
When this License requires any LICENSEE to notify CULLIGAN, an additional copy will be transmitted
to its General Counsel at CULLIGAN’S address for its principal place of business set forth above.
Either party may change its address for receiving notices by giving written notice to the other
party in accordance with the provisions of this Section.
8.2 No party will be liable for delays or non-performance caused by fire, flood, explosion,
accident, strike, war, riots, sabotage, terrorism or material changes in governmental law or
regulation, or for other causes beyond its control, but the delaying party will exercise all
reasonable efforts to cure and minimize the extent of the delay.
8.3 This License and Attachment A and the Purchase Agreement contain the
complete understanding between the parties concerning the Marks and other subjects covered herein.
This License may not be modified or supplemented except by a writing signed by authorized officers
of each party. This License is independent of any other agreement that may be in effect between
the parties.
8.4 If any term or provision of this License should be declared invalid by a court of
competent jurisdiction, the remaining terms and provisions will be unimpaired and the invalid term
or provision will be replaced by such valid term or provision as comes closest to the intention
underlying the invalid term or provision.
8.5 No waiver or delay by CULLIGAN or any LICENSEE in the enforcement of any term, covenant or
condition of this License will be construed as a waiver by that party of such covenant or condition
of this License. The observation or performance of any condition or obligation imposed upon a
party under this License may be waived only in writing by an authorized officer and only to the
extent stated in such writing.
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8.6 All remedies provided under this License are cumulative and in addition to any remedy
otherwise available under any federal, state or local law.
8.7 This License, and any and all disputes between CULLIGAN and any LICENSEE related to this
License, are to be exclusively construed in accordance with and governed by the laws of the State
of Illinois, without regard to choice of law or conflicts of law principles that might apply the
laws of another state. Any lawsuit between any LICENSEE and CULLIGAN related to this License shall
be adjudicated exclusively in a state or federal court located in Xxxx County, Illinois, the county
in which CULLIGAN presently has its principal place of business. Each LICENSEE waives any
objections that it may have to jurisdiction or venue in those courts and shall not make any claim
that litigating disputes in such courts would be an inconvenient forum. In the event of a lawsuit
or proceeding between the parties, the nonprevailing party will pay or reimburse, as the case may
be, the expenses and costs, including court costs and reasonable attorneys’ fees, of the prevailing
party.
8.8 This License is binding on the respective, permitted successors in interest, assignees,
executors, administrators and heirs of the parties.
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IN WITNESS WHEREOF, this License has been duly executed by the parties hereto on the Effective
Date.
| P1 SUB, LLC |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| P2 SUB, LLC |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| CULLIGAN INTERNATIONAL COMPANY |
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| By: | ||||
| Name: | ||||
| Title: | ||||
ATTACHMENT A
XXXXX
| Xxxx | Registration Number | Jurisdiction | ||||
TRUST THE WATER EXPERTS
|
1890197 | USA | ||||
CULLIGAN & DESIGN (script with water drop design) |
1365112 | USA | ||||
Any other Culligan-owned trademark affixed to the Purchased Assets as of the date hereof
