AMENDMENT TO AGREEMENT FOR STRATEGIC ALLIANCE AND LICENSE AGREEMENT
Exhibit 10.44
AMENDMENT TO AGREEMENT FOR STRATEGIC ALLIANCE
AND LICENSE AGREEMENT
This Amendment is entered into on March 14, 2003 by and between
MIDAS INTERNATIONAL CORPORATION, 0000 Xxxxxxxxx Xxxxxxx Xxxx, Xxxxxx, Xxxxxxxx 00000 hereby represented by Xxxx X. Xxxxxxx, President and Chief Executive Officer (hereinafter “MIDAS”)
and
MAGNETI MARELLI SERVICES S.p.A. X.xx Xxxxxxxx 000/X 00000 Xxxxxx (Xxxxx) hereby represented by Carlo Bondone, Director and Special Attorney (hereinafter “Marelli”)
WHEREAS:
| A. | The parties have signed (or are the successors to the original party of) the Agreement for Strategic Alliance dated October 1, 1998 (“Agreement”) and a License Agreement dated October 30, 1998 (“License Agreement”). |
| B. | Prior to the date hereof, the entry fees and royalties required to be paid by Marelli to MIDAS under the Agreement and the License Agreement have been subsequently renegotiated according to Attachment A hereto. |
| C. | The parties have thereafter and recently agreed on the additional modifications to the Agreement and the License Agreement set forth herein. |
NOW THEREFORE IT IS AGREED AS FOLLOWS
| 1. | Capitalized terms not otherwise defined herein shall have the meanings contained in the Agreement and License Agreement, as applicable. |
| 2. | The royalties required to be paid by Marelli to MIDAS under the License Agreement from and after January 1, 2003, are hereby modified by agreement of the parties, and they will be as set forth below: |
| (a) | Fixed Amounts |
2003 = US $ 8,40 MM
2004 = US $ 8,82 MM
2005 = US $ 9,26 MM
2006 = US $ 9,72 MM
2007 = US $ 8,90 MM
| (b) | Royalties on Turnover |
2008 and beyond = 1,00% of Gross Revenue, until such time as the Marelli business using the MIDAS System achieves annual Gross Revenue of US $650 MM, at which time, starting from the following fiscal year, the royalties on turnover shall be 1,25% of Gross Revenue
| 3. | With respect to the countries and continents set forth in Attachment B (the “New Countries”) the entry fees otherwise required to be paid by Marelli to MIDAS under Section II, 5.3, of the Agreement are hereby modified by agreement of the parties, and, effective as of the date of this Amendment, they will be eliminated (including those still due under Attachment A hereto). Instead of entry fees, Marelli shall pay to MIDAS, for each new MIDAS shop opened in a New Country after the date of this Amendment (whether a newly-built MIDAS shop, an existing competitor’s shop converted to a MIDAS shop, or otherwise) a new shop opening fee (“Shop Opening Fee”) equal to: |
| (a) | US $5,000 for each of the first fifty (50) new MIDAS shops opened in each New Country; and |
| (b) | US $10,000 for each additional new MIDAS shop in excess of fifty (50) opened in each New Country. |
With respect to Russia, Great Britain, Ireland and South Africa, the Shop Opening Fee shall be equal to US $10,000 for each new MIDAS shop opened in such country or on such continent.
No Shop Opening Fees are required to be paid by Marelli for Argentina, Turkey, Germany, Morocco and those countries set forth in Annex A to the Agreement.
| 4. | By completing the payments due to MIDAS under the Agreement and the License Agreement up to and including the date of this Amendment, and subject to Marelli’s payment to MIDAS of the Shop Opening Fees provided under Section 3 above, Marelli will acquire exclusive rights to exploit the MIDAS System in the New Countries without any further obligation to pay New Country entry fees to MIDAS under Section II, 5.3, of the Agreement. Marelli is free to exploit the MIDAS System in the New Countries effective from the date hereof in the manner provided under the Agreement and the License Agreement. |
| 5. | Marelli’s exclusive right to exploit the MIDAS System in each of the New Countries, as contained in Section 4 above, is subject to Marelli submitting to MIDAS, on or before April 30, 2003, a Shop Development Plan reasonably acceptable to MIDAS, which sets forth the number of new MIDAS shops to be opened in each of the New Countries and the timeline for such openings, and meeting such development requirements in accordance with the schedule set forth thereon. Marelli shall have a one (1) year cure period for any failure to meet the Shop Development Plan. |
| 6. | The support contemplated in Section II, 2.1, of the Agreement is intended to be only upon Marelli’s written request to MIDAS. |
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| 7. | The support contemplated in Section II, 2.2, of the Agreement will no longer be required to be made available to Marelli, which will arrange for any training on its own care and expenses. |
| 8. | The reports mentioned under Section II, 2.6, of the Agreement will be exchanged by the parties on a semi-annual basis. |
| 9. | The meetings under Section II, 2.5 and 2.7, of the Agreement are intended to be held on a semi-annual basis. |
| 10. | By executing this Amendment, MIDAS is formally notifying Marelli that it does not intend to exercise its right of first option and first refusal under Section II, 5.5, of the Agreement to acquire Marelli’s assets and rights relevant to the MIDAS system in the countries of Poland and Austria. However, any purchaser of those assets and rights must satisfy the requirements set forth in Section II, 5.5, of the Agreement, unless otherwise agreed to in writing by MIDAS, such agreement not to be unreasonably withheld or delayed by MIDAS. |
| 11. | All other terms and conditions of the Agreement and of the License Agreement not expressly modified by this Amendment shall remain unchanged and continue in full force and effect. |
Executed in Chicago, Illinois, U.S.A, on March 14, 2003.
| MIDAS INTERNATIONAL CORPORATION | MAGNETI MARELLI SERVICES S.p.A. | |||
| /s/ Xxxx X. Xxxxxxx | /s/ Carlo Bondone | |||
| Xxxx X. Xxxxxxx President and Chief Executive Officer |
Carlo Bondone Director and Special Attorney | |||
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MIDAS
AMENDMENTS TO THE LICENSE AGREEMENT
dated October 30, 1998
ROYALTIES REVISION
| 1. | FIXED AMOUNTS |
Below are the gross amounts due by Licensee to Licensor for each calendar year in monthly installments
| 2000 | = | $ | 6,50 | MM | 2004 | = | $ | 8,82 | MM | |||||||||
| 2001 | = | $ | 7,35 | MM | 2005 | = | $ | 9,26 | MM | |||||||||
| 2002 | = | $ | 7,80 | MM | 2006 | = | $ | 9,72 | MM | |||||||||
| 2003 | = | $ | 8,40 | MM | 2007 | = | $ | 10,20 | MM |
| 2. | ROYALTIES ON TURNOVER |
| 2008 | = | 2,00% | 2009 | = | 1,25% 1999 Countries | |||||||
| 2,00% Xxxxxx - Xxxxxxxxx - Xxxxxxx | ||||||||||||
| 0000 | = | 1,25% | 1999 Countries + Turkey and Argentina | 2011 | = | all Countries 1,25% | ||||||
| 2,00% | Germany | |||||||||||
| 3. | NEW COUNTRIES |
| January 2000 | = | Argentina + Turkey | g | entry fee | = | 765,425 $ + 523,865 | g | 12 installments from January 2000 | ||||||||
| January 2001 | = | Germany | g | entry fee | = | 6,567,235 $ | g | 60 installments from January 2001 | ||||||||
| 4. | MOROCCO + CHILE |
| entry fee | g | to be agreed upon | ||
| Royalties | g | 1,25% | ||
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Attachment B
| 1. | Africa |
| 2. | Albania |
| 3. | Belarus |
| 4. | Bosnia and Herzegovina |
| 5. | Bulgaria |
| 6. | Xxxxxxx |
| 0. | Xxxxx Xxxxxxxx |
| 8. | Denmark |
| 9. | Dominican Republic |
| 10. | Estonia |
| 11. | Finland |
| 12. | F.Y.R.O. Macedonia |
| 13. | Great Britain |
| 14. | Greece |
| 15. | Hungary |
| 16. | Iceland |
| 17. | Ireland |
| 18. | Latvia |
| 19. | Lithuania |
| 20. | Madagascar |
| 21. | Mauritius Island |
| 22. | Xxxxxxx |
| 00. | Xxxxxxxxxxx |
| 24. | Norway |
| 25. | Romania |
| 26. | Russia |
| 27. | Xxxxxxxx |
| 00. | Xxxxxxxx |
| 29. | Sweden |
| 30. | Tobago |
| 31. | Trinidad |
| 32. | Ukraine |
| 33. | Yugoslavia |
| 34. | Middle East (excluding Saudi Arabia) |
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