TEST MARKET LICENSE AGREEMENT FOR VERYFINE FROZEN JUICE BAR
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THIS AGREEMENT ("Agreement"), effective April 1, 1998, is made by and
between Veryfine Products, Inc., a Massachusetts corporation, with its principal
place of business at 000 Xxxxxxxxx Xxxx, Xxxxxxxx, XX ("Veryfine") and New
Yorker Frozen Desserts, Inc., a New York corporation with its principal place of
business at 0000 Xxxxxxxx Xxxxxxxxx, Xxxxx, XX 00000 ("New Yorker").
Section 1. Grant of License.
-----------------------------
1.1. License Subject to the terms hereof and in consideration of the payment of
the royalty specified hereinafter, Veryfine hereby grants to New Yorker, and New
Yorker hereby accepts from Veryfine, an exclusive license to manufacture and
sell frozen juice bars in the flavors, sizes and packaging listed in Schedule
1.1 ("Licensed Products"), for sale solely in the territory listed in Schedule
1.2 ("Licensed Territory") using the trademarks identified in Schedule 1.3
("Licensed Trademarks"). Veryfine shall not license the Licensed Products to any
other party during the term of this Agreement. This Agreement shall not preclude
Veryfine from entering into licensing arrangements with another party for freeze
pops. During the term of this Agreement, the Licensed Products shall be the only
branded frozen juice bar manufactured or sold by New Yorker.
1.2. Sub-License New Yorker shall have the right to grant sub-licenses to third
parties to manufacture and sell the Licensed Products; provided, however, that
any sub-licensee is subject to the prior written approval of Veryfine and must
execute a sub-license agreement which includes the license provisions listed in
Exhibit A to this Agreement.
Section 2. Royalty and Payment.
--------------------------------
2.1. Royalty New Yorker shall pay to Veryfine a royalty fee of one dollar
($1.00) per case (24 individual juice bars) of the Licensed Products sold by New
Yorker.
2.2. Payment New Yorker shall keep an accurate account of the Licensed Products
manufactured and sold under the scope of the license granted hereunder and shall
render a statement in writing to Veryfine within 30 days after the end of each
calendar quarter during the term of this Agreement, and shall, concurrently with
the rendering of such statement, pay to Veryfine the amount of the royalties
accrued during the corresponding calendar quarter. Veryfine shall have the right
to examine New Yorker's books relating to the Licensed Products to verify the
royalty statements and royalties due to Veryfine pursuant to this Agreement.
Section 3 Marketing Efforts.
-----------------------------
3.1. Marketing Fund New Yorker shall set aside fifty cents ($.50) for each case
of Licensed Product sold, which shall accrue into a marketing fund. These funds
will be used by New Yorker exclusively for promotional activities, to support
the sale of the Licensed Products.
3.2. Sales Quota New Yorker accepts the quotas outlined on Schedule 3.1 as the
agreed sales targets for this market test. New Yorker will expend its best
efforts to attain the quotas, recognizing that achieving the quotas will
determine the continuation of this license agreement.
3.3. Marketing Materials, Packaging, Labels New Yorker agrees to receive
Veryfine's written approval for all marketing materials, packaging and labels
related to the Licensed Products and shall keep all such material consistent
with similar material for Veryfine beverage products.
Section 4. Product Formulation and Manufacture.
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4.1. Formula All formulas developed by New Yorker for use in producing the
Licensed Products must be approved by Veryfine in writing and will be the sole
property of Veryfine. New Yorker may use such formulas solely in accordance with
the terms and conditions of this Agreement. All Licensed Products shall be
produced from Veryfine approved flavoring agents which shall be purchased from
Veryfine or Veryfine designated vendors.
4.2. Manufacture In manufacturing the Licensed Products, New Yorker agrees to
maintain reasonable standards, specifications and procedures, consistent with
those accepted in the industry, relating to quality assurance for the Licensed
Products and raw materials. New Yorker agrees to accept and implement any
reasonable additional quality control and quality assurance procedures Veryfine
may specify.
4.3. Inspection During normal business hours, Veryfine shall have the right to
inspect New Yorker's facilities.
Section 5. Trademarks and Confidential Information.
----------------------------------------------------
5.1. Trademarks New Yorker acknowledges and Veryfine represents that it has the
full right and title to the Licensed Trademarks. New Yorker shall not use the
Licensed Trademarks on any product except the Licensed Products and only as
contemplated by this Agreement. It is agreed and understood that no right,
property, license, permission or interest of any kind or nature in or to the
Licensed Trademarks is intended to be given or transferred to or acquired by New
Yorker by the execution, performance or non-performance of this Agreement or any
part thereof, except as expressly provided herein. At the termination of this
Agreement, New Yorker agrees to cease all use of the Licensed Trademarks and
make no claim to any ownership interest in the Licensed Trademarks.
5.2. Confidentiality In connection with the Agreement, each party will disclose
certain confidential and proprietary technical and business information
("Confidential Information") to the other party. Each party shall take all
reasonable measures to keep Confidential Information of the disclosing party
confidential and shall not disclose Confidential Information without prior
written permission of the disclosing party. Unless specified otherwise in this
Agreement, all originals and copies of Confidential Information shall remain the
property of the disclosing party and shall be returned upon the termination of
this Agreement. New Yorker may disclose Confidential Information to potential or
actual sub-licensees or mutually approved manufacturers, but only to the extent
necessary for the sub-license or manufacturing arrangement and only if such
potential or actual sub-licensee or mutually approved manufacturer is bound by a
confidentiality agreement reasonably protecting the confidential nature of the
Confidential Information.
Section 6. Covenants, Representations and Warranties.
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6.1. Veryfine warrants that it holds or has filed for the United States
trademark registrations for all the Licensed Trademarks.
6.2. In the manufacture of the Licensed Products, New Yorker shall strictly
comply with all applicable packaging, food, drug, health and sanitary laws and
regulations and environmental laws and regulations, including, but not limited
to, the Federal Food, Drug and Cosmetic Act, as amended, and the regulations
promulgated thereunder including current good manufacturing practices. New
Yorker shall blend, process, package, store and load the Licensed Products for
shipment in accordance with accepted industry standards of safety and
cleanliness, in compliance with applicable federal, state and local laws, rules,
regulation, ordinances and requirements of any governmental body in effect
during the Term hereof and in such a way as to achieve the highest consistent
quality possible. In the marketing and sale of the Licensed Products, New Yorker
shall strictly comply with all applicable laws, statutes, ordinances, rules and
regulations of all federal, state, local or other governmental or regulatory
entities to which it is bound or affected.
6.3. New Yorker hereby warrants that the Licensed Products shall (i) strictly
conform to the formulas approved by Veryfine; (ii) conform to the laws,
statutes, ordinances, regulations and rules referenced in Section 6.2.; (iii) be
free from any manufacturing defect; and, (iv) not be adulterated within the
meaning of all applicable federal, state and local laws and regulations.
6.4. New Yorker shall maintain for the benefit of both New Yorker and Veryfine
during the Term of the Agreement and for twelve (12) months following the
termination thereof, comprehensive general liability insurance (including
product liability) and so-called "all-risks" property damage insurance insuring
the Licensed Product, the Equipment and any related materials against loss or
damage. The insurance shall be maintained with limits acceptable to Veryfine,
initially no less than $1,000,000 bodily injury per occurrence; $300,000
property damage per occurrence (or $1,000,000 combined single limit per
occurrence bodily injury and property damage). New Yorker agrees to provide a
certificate of insurance within fifteen (15) days of signing this Agreement
specifying that (i) the insurance applies as primary coverage and will not be
contributory with any other insurance available to Veryfine; and (ii) the
coverage will not be canceled or reduced without thirty (30) days prior written
notice to Veryfine.
Section 7. Indemnification.
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7.1. Veryfine shall indemnify and hold harmless New Yorker, its parent,
subsidiary and affiliated companies and their respective officers, directors,
employees, agents and representatives from all claims of trademark infringement
arising from the use of the Licensed Trademarks with the Licensed Products, and
all related losses, damages, liabilities, costs and expenses (including
reasonable attorney's fees) incurred by New Yorker unless such acts or omissions
were caused by the Indemnified Party. New Yorker shall indemnify and hold
harmless Veryfine, its parent, subsidiary and affiliated companies and their
respective officers, directors, employees, agents and representatives from all
claims arising from the manufacture of the Licensed Products by New Yorker or
any sub-licensee of New Yorker, and all related losses, damages, liabilities,
costs and expenses (including reasonable attorney's fees) incurred by Veryfine,
unless such acts or omissions were caused by the Indemnified Party.
Section 8. Term and Termination.
---------------------------------
8.1 Term and Termination. The term of this Agreement shall begin on the date
hereof and continue for two years unless terminated by either party in
accordance with the provisions specified in the Agreement. The Agreement may be
terminated as follows:
(a) Bankruptcy, etc. Immediately upon written notice to the other party in
the event that proceedings in bankruptcy or insolvency are instituted by or
against the other party, or a receiver is appointed, or if any substantial part
of the assets of the other party is the object of attachment, sequestration or
other type of comparable proceeding, and such proceeding is not vacated or
terminated within ninety (90) days after its commencement or institution.
(b) Default. If one party commits a material breach of any of the terms or
provisions of this Agreement and does not cure such breach within thirty (30)
days after receipt of written notice given by the other party;
(c) Licenses. Immediately if either party is unable to obtain or renew any
permit, license, patent or other governmental approval necessary to carry on the
business contemplated under this Agreement.
(d) Product Formulation. If New Yorker manufactures the Licensed Product in
a manner inconsistent with formulas approved by Veryfine and does not correct
all such manufacturing inconsistencies within sixty (60) days after receipt of
written notice from Veryfine of such manufacturing inconsistencies.
(e) Abandonment. Immediately by Veryfine if New Yorker shall abandon the
sale of the Licensed Products by failing for a period of two quarters to engage
in the sale of Licensed Products.
Section 9. Miscellaneous.
9.1. Notice All notices relating to the provisions of this Agreement shall be in
writing and sent to:
Veryfine: Veryfine Products, Inc.
000 Xxxxxxxxx Xxxx
X.X. Xxx 000
Xxxxxxxx, XX 00000
Attention: Xx. Xxxxxxx Xxxxx
New Yorker: New Yorker Frozen Desserts, Inc.
0000 Xxxxxxxx Xxxxxxxxx
Xxxxx, XX 00000
Attention: Mr. Xxxx Xxxxxxxx
or such other address as either party may designate.
9.2. No Waiver Waiver by either party of any breach or the failure by either
party to enforce any of the provisions of this Agreement at any time shall not
in any way affect, limit or waive the right of such party thereafter to enforce
and compel strict compliance with each and every term and condition hereof.
9.3. Assignment; Successors in Interest The rights and obligations under this
Agreement shall not be assigned by either party without the prior written
consent of the other party; except in the case of an assignment to an affiliated
company or in connection with a sale of substantially all assets. Subject to the
foregoing, this Agreement shall be binding upon and inure to the benefit of the
parties and their respective allowable successors and assigns.
9.4. Severability This unenforceability, invalidity or illegality of any
provision of this Agreement shall not affect or impair any other provision or
render it unenforceable, invalid or illegal.
9.5. Headings The headings and titles used herein are for convenience only and
shall not affect the construction and interpretation of this Agreement.
9.6. Applicable Law This Agreement shall be construed and enforced in accordance
with the laws of the Commonwealth of Massachusetts, applicable to agreements
made and to be performed entirely with Massachusetts.
9.7. Relationship The relationship of the parties is and shall be solely that of
independent contractors.
9.8. Entire Agreement; Amendment This agreement and the attached schedules
constitute the entire understanding between the parties concerning the subject
matter hereof and supersedes any and all previous agreements between the
parties. This Agreement shall not be modified or altered except by a written
instrument signed by an authorized representative of each party. Both parties
acknowledge that this agreement may be amended to promote new opportunities as
they arise and any modifications will be agreed in writing by both parties.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized representative on the date first above
written.
VERYFINE PRODUCTS, INC. NEW YORKER FROZEN DESSERTS, INC.
By: /s/ By: /s/
----------------------------- ------------------------------
Title: Vice President Title: Vice President
----------------------------- ------------------------------
SCHEDULE 1.1
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LICENSED PRODUCTS
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ITEMS FLAVORS PACKAGING
----- ------- ---------
3 oz Single Stick Bar Orange Single Serve Box
Fruit Punch
Strawberry Kiwi
SUB-LICENSEE
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2.5 Single Stick Bar Orange Single Serve Wrap
Fruit Punch
Strawberry Kiwi
SCHEDULE 1.2
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LICENSED TERRITORY The Counties of New York City, Nassau, Suffolk, Westchester,
Putnam, Rockland in N.Y. and the following Counties in New Jersey, Bergen,
Essex, Xxxxxx Union, Middlesex and Monmouth and the State of Connecticut.
Schedule 1.3
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Licensed Trademarks
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Veryfine
Veryfine logo (see attached)
Veryfine Logo
SCHEDULE 3.1
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QUOTAS
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New Yorker shall sell at least the number of cases of the Licensed Products
listed below in each respective year of this Agreement:
1st Year 85,000
2nd Year 220,000
EXHIBIT A
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SUB-LICENSE PROVISIONS
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Grant of License.
-----------------
License. Subject to the terms hereof and in consideration of the payment of
the royalty specified hereinafter, New Yorker hereby grants to Sub-Licensee and
Sub-Licensee hereby accepts from New Yorker, a license to manufacture and sell
frozen juice bars in the flavors, sizes and packaging listed in Schedule 1.1
("Licensed Products"), for sale solely in the territory listed in Schedule 1.2
("Licensed Territory") using the trademarks identified in Schedule 1.3
("Licensed Trademarks"). Sub-Licensee shall have no right to grant sub-licenses
to any other third party.
Marketing Efforts.
------------------
Marketing Materials, Packaging, Labels. Sub-Licensee agrees to receive
Veryfine's written approval for all marketing materials, packaging and labels
related to the Licensed Products and shall keep all such material consistent
with similar material for Veryfine beverage products.
Product Formulation and Manufacture.
------------------------------------
Formula. All formulas developed or used by Sub-Licensee for use in
producing the Licensed Products must be approved by Veryfine in writing and will
be the sole property of Veryfine. Sub-Licensee may use such formulas solely in
accordance with the terms and conditions of this Agreement. All Licensed
Products shall be produced from Veryfine approved flavoring agents which shall
be purchased from Veryfine or Veryfine designated vendors.
Manufacture. In manufacturing the Licensed Products, Sub-Licensee agrees to
maintain reasonable standards, specifications and procedures, consistent with
those accepted in the industry, relating to quality assurance for the Licensed
Products and raw materials. Sub-Licensee agrees to accept and implement any
reasonable additional quality control and quality assurance procedures that
Veryfine or New Yorker may specify.
Inspection. During normal business hours, Veryfine and New Yorker shall
have the right to inspect Sub-Licensee's facilities.
Trademark and Confidential Information.
---------------------------------------
Trademarks. Sub-Licensee acknowledges that Veryfine has the full right and
title to the Licensed Trademarks. Sub-Licensee shall not use the Licensed
Trademarks on any product except the Licensed Products and only as contemplated
by this Agreement. It is agreed and understood that no right, property, license,
permission or interest of any kind or nature in or to the Licensed Trademarks is
intended to be given or transferred to or acquired by Sub-Licensee herein. At
the termination of this Agreement, Sub-Licensee agrees to cease all use of the
Licensed Trademarks and make no claim to any ownership interest in the Licensed
Trademarks.
Confidentiality. In connection with the Agreement, each party will disclose
certain confidential and proprietary technical and business information
("Confidential Information") to the other party. Each party shall take all
reasonable measures to keep Confidential Information of the disclosing party
confidential and shall not disclose Confidential Information without prior
written permission of the disclosing party. Unless specified otherwise in this
Agreement, all originals and copies of such information shall remain the
property of the disclosing party and Confidential Information shall be returned
upon the termination of this Agreement.
Covenants, Representations and Warranties.
------------------------------------------
In the manufacture of the Licensed Products, Sub-Licensee shall strictly
comply with all applicable packaging, food, drug, health and sanitary laws and
regulations and environmental laws and regulations, including, but not limited
to, the Federal Food, Drug and Cosmetic Act, as amended, and the regulations
promulgated thereunder including current good manufacturing practices.
Sub-Licensee shall blend, process, package, store and load the Licensed Products
for shipment in accordance with accepted industry standards of safety and
cleanliness, in compliance with applicable federal, state and local laws, rules,
regulation, ordinances and requirements of any governmental body in effect
during the Term hereof and in such a way as to achieve the highest consistent
quality possible. In the marketing and sale of the Licensed Products,
Sub-Licensee shall strictly comply with all applicable laws, statutes,
ordinances, rules and regulations of all federal, state, local or other
government entities to which it is bound or affected.
Sub-Licensee hereby warrants that the Licensed Products shall (i) strictly
conform to the formulas approved by Veryfine, (ii) conform to the laws, statues,
ordinances, regulations and rules referenced in paragraph above; (iii) be free
from any manufacturing defect; and, (iv) not be adulterated within the meaning
of all applicable federal, state and local laws and regulations.
Sub-Licensee shall maintain for the benefit of Sub-Licensee, New Yorker and
Veryfine during the Term of the Agreement and for twelve (12) months following
the termination thereof, comprehensive general liability insurance (including
product liability) and so-called "all-risks" property damage insurance insuring
the Licensed Product, and any related materials against loss or damage. The
insurance shall be maintained with limits acceptable to New Yorker and Veryfine,
initially no less than $1,000,000 bodily injury per occurrence; $300,000
property damage per occurrence (or $1,000,000 combined single limit per
occurrence bodily injury and property damage). Sub-Licensee agrees to provide a
certificate of insurance to Veryfine and New Yorker within fifteen (15) days of
signing this Agreement specifying that (i) the insurance applies as primary
coverage and will not be contributory with any other insurance available to
Veryfine and New Yorker; and (ii) the coverage will not be canceled or reduced
without thirty (30) days prior written notice to Veryfine and New Yorker.
SUB-LICENSE PROVISIONS
----------------------
SCHEDULE 1.1
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LICENSED PRODUCTS
-----------------
ITEMS FLAVORS PACKAGING
----- ------- ---------
2.5 Single Stick Bar Orange Single Serve Wrap
Fruit Punch
Strawberry Kiwi
SUB-LICENSE PROVISIONS
----------------------
SCHEDULE 1.2
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LICENSED TERRITORY [Specify distribution area]
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SUB-LICENSE PROVISIONS
----------------------
Schedule 1.3
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Licensed Trademarks
-------------------
Veryfine
Veryfine logo (see attached)
