1
LICENSE AGREEMENT
Date: January 1, 1998
Re: MULTIPLE BRANDS/PROPERTIES
This license agreement ("Agreement") is entered into by and between Disney
Enterprises, Inc. ("Disney"), with a principal place of business at 000 Xxxxx
Xxxxx Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxx 00000, and CROWN CRAFTS, INC.
("Licensee"), with its principal place of business at 0000 XxxxxXxxx Xxxxxxx,
Xxxxx 000, Xxxxxxx, Xxxxxxx 00000. Disney and Licensee agree as follows:
1. MEANING OF TERMS
A. "LICENSED MATERIAL" means the graphic representations of the
following:
Such characters and depictions of such characters, and such
still scenes and accompanying design elements, as may be
designated by Disney, from those Properties (as defined
below) as are licensed hereunder and are the subject of
separate written "Schedules" attached hereto, pursuant to
such specifications as set forth in the applicable Schedule
for each individual Property licensed hereunder. Said
Schedules shall be numbered consecutively starting with
Schedule 1 for the first Property so licensed, subject to the
terms of this Agreement, and each Schedule is hereby
incorporated herein by reference as if fully set forth.
B. "TRADEMARKS" means "XXXX DISNEY", "DISNEY", the
representations of Licensed Material included in Paragraph
1.A. above, and the brand name(s) and logo(s) of the
Properties in which Licensed Material included in Paragraph
1.A. above appears, as are licensed hereunder, pursuant to
the specifications stated in the applicable Schedule for each
such licensed Property.
C. "ARTICLES" means the items on or in connection with which the
Licensed Material and/or the Trademarks are reproduced or
used, and includes each and every stock keeping unit ("SKU")
of each Article as are specified on the applicable Schedule
for each Property licensed hereunder.
D. "MINIMUM PER ARTICLE ROYALTY" means for each Article
identified herein which is sold the sum indicated herein:
None.
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E. "TERM" of this Agreement means the period commencing as of
January 1, 1998, and ending upon the expiration of the latest
Schedule entered into hereunder. The term applicable for each
specific Property licensed hereunder shall be the period
commencing as of the Effective Date and ending on the
Termination Date stated on the applicable Schedule for each
such Property.
F. "TERRITORY" means the United States, United States PX's
wherever located, and United States territories and
possessions, excluding Puerto Rico, Guam, Commonwealth of
Northern Mariana Islands and Palau. However, if sales are
made to chain stores in the United States which have stores
in Puerto Rico, such chain stores may supply Articles to such
stores in Puerto Rico.
G. "ROYALTIES" means a royalty in the amounts set forth below in
Paragraphs 1.G.(1)(a) - (e) and Royalties shall be further
governed by the provisions contained in Paragraphs
1.G.(2)-(6):
[*](1)
H. "NET INVOICED XXXXXXXX" means the following:
(1) actual invoiced xxxxxxxx (i.e., sales quantity
multiplied by Licensee's selling price) for
Articles sold, and all other receivables of any
kind whatsoever, received in payment for the
Articles, whether received by Licensee or any of
Licensee's Affiliates, except as provided in
Paragraph 1.H.(2), less "Allowable Deductions" as
hereinafter defined.
(2) The following are not part of Net Invoiced
Xxxxxxxx: invoiced charges for transportation of
Articles within the Territory which are
separately identified on the sales invoice, and
sales taxes.
I. [*](2)
J. "ROYALTY PAYMENT PERIOD" means each calendar monthly period
during the Term and during the sell-off period, if granted.
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(1) Confidential portions omitted and filed separately with the Commission.
(2) Confidential portions omitted and filed separately with the Commission.
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K. "ADVANCE" means the non-refundable sum(s) stated in the
applicable Schedule for each Property, payable by the date(s)
indicated therein, as an advance on Royalties to accrue in
the period(s) stated in the applicable Schedule.
L. "GUARANTEE" means the sum(s) which Licensee guarantees to pay
as minimum Royalties on Licensee's cumulative sales of
Articles for each Property as stated in the applicable
Schedule attached hereto, in the calendar year increments
stated in the subject Schedule. Any shortfall shall be
payable at the end of the applicable calendar year. For any
given Property, the Guarantee may be broken down into
separate Guarantees for each of the individual product lines
licensed thereunder.
M. "SAMPLES" means six (6) samples of each SKU of each Article,
from the first production run of each supplier of each SKU of
each Article.
N. "PROMOTION COMMITMENT" means the following sum(s) which
Licensee agrees to spend in the following way(s):
[*](3)
O. "MARKETING DATE" means the date(s) specified on the
applicable Schedule for each Property by which the specified
Article(s) shall be available for purchase by the public at
the retail outlets authorized pursuant to Paragraph 2.A.
P. "AFFILIATE" means, with regard to Licensee, any corporation
or other entity which directly or indirectly controls, is
controlled by, or is under common control with Licensee; with
regard to Disney, "Affiliate" means any corporation or other
entity which directly or indirectly controls, is controlled
by, or is under common control with Disney. "Control" of an
entity shall mean possession, directly or indirectly, of
power to direct or cause the direction of management or
policies of such entity, whether through ownership of voting
securities, by contract or otherwise.
Q. "LAWS" means any and all applicable laws, rules, and
regulations, including but not limited to, local and national
laws, rules and regulations, treaties, voluntary industry
standards, association laws, codes or other obligations
pertaining to the grant and exercise of the license granted
herein and to any
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(3) Confidential portions omitted and filed separately with the Commission.
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of Licensee's activities under this Agreement, including but
not limited to those applicable to any tax, and to the
manufacture, pricing, sale and/or distribution of the
Articles.
R. "RETAILER" means independent and chain retail outlets which
have storefronts and business licenses, and which customers
walk into, not up to; "WHOLESALER" means a seller of items to
retailers, not consumers, and includes the term
"distributor". The following do not qualify as authorized
sales outlets for Articles under this Agreement under any
circumstances: swap meets, flea markets, street peddlers,
unauthorized kiosks, and the like.
S. "MANUFACTURER" means any of Licensee's third-party
manufacturers and suppliers (and their sub-manufacturers and
suppliers) which reproduce or use the Licensed Material
and/or Trademarks on Articles, or components thereof, and/or
which assemble such Articles.
T. "PROPERTIES" means any or all of the "Studio Properties" and
the "Branded Properties" as defined below.
U. "STUDIO PROPERTIES" means those Disney children-oriented
studio properties (including children-oriented properties
developed by Disney for ABC) released or introduced on or
before December 31, 1999, from any source, including but not
limited to books, feature films, television and home video,
which receive Disney advertising and licensing support.
(1) The specific characters and Licensed Material
licensed under any Studio Property shall be
specified on the relevant Schedule for said
Studio Property.
[*](4)
V. "BRANDED PROPERTIES" means the children-oriented Disney
copyrighted characters or properties not necessarily
associated with a Studio Property, which include any and all
Disney classic characters, the Disney Standard Characters and
the Winnie the Pooh characters, and which may be licensed by
Disney as either individual characters or as part of one or
more merchandise programs or brands of merchandise. The
specific characters and Licensed Material licensed under any
Branded Property shall be specified on the relevant Schedule
for said Branded Property.
--------------------------------
(4) Confidential portions omitted and filed separately with the Commission.
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W. "SCHEDULE" means each separate "Schedule to License
Agreement" entered into between Disney and Licensee on a
Property-by-Property basis, the terms of each of which are
hereby incorporated herein by reference and made a part
hereof as though fully set forth. The Schedule for each
Property licensed hereunder shall state any and all contract
terms as are specific to such Property.
2. RIGHTS GRANTED
A. (1) In consideration for Licensee's promise to pay and
Licensee's payment of all monetary obligations
required hereunder, and Licensee's performance of
all other obligations required of Licensee hereunder
for each Property that becomes the subject of a
separate Schedule entered into between Disney and
Licensee, Disney grants Licensee the non-exclusive
right, during the term of the relevant Schedule for
each subject Property, and only within the
Territory, to reproduce the subject Licensed
Material only on or in connection with the Articles,
to use such specified Trademarks and uses thereof as
may be approved when each SKU of the Articles is
approved and only on or in connection with the
Articles, and to manufacture, distribute for sale
and sell the Articles as authorized by this
Paragraph 2.A.
(2) Licensee will sell the Articles only to authorized
customers in the Territory as specified in the
relevant Schedule for the subject Property.
(3) Licensee may not sell the Articles by direct
marketing methods, which includes but is not limited
to, computer on-line selling, direct mail and
door-to-door solicitation. Licensee may not sell the
Articles to Retailers selling merchandise on a
duty-free basis, or to Wholesalers for resale to
such Retailers, unless such Retailer or Wholesaler
has a then-current license agreement with Disney or
any of Disney's Affiliates permitting it to make
such duty-free sales.
(4) Licensee may sell the Articles to authorized
customers for resale through the pre-approved mail
order catalogs listed on the Catalog Schedules to
this Agreement, and Licensee shall pay Royalties on
such sales at the rate specified for Retailers in
the applicable Schedule.
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(5) All rights not expressly granted to Licensee
herein are reserved to Disney.
B. Unless Disney consents in writing, Licensee shall not sell or
otherwise provide Articles for use as premiums (including
those in purchase-with- purchase promotions), promotions,
give-aways, fund-raisers, or entries in sweepstakes, or
through unapproved direct marketing methods, including but
not limited to, home shopping television programs, or to
customers for inclusion in another product. Licensee shall
not sell Articles to any customer whose business methods are
legally or ethically questionable. If Licensee wishes to sell
the Articles to customers for resale through mail order
catalogs other than those listed on the Catalog Schedules
hereto, Licensee must obtain Disney's prior written consent
in each instance. However, Licensee may solicit orders by
mail from those Retailers authorized pursuant to the
applicable Schedule for the subject Property, and Licensee
may sell to Retailers which sell predominantly at retail, but
which include the Articles in their mail order catalogs, or
otherwise sell Articles by direct marketing methods as well
as at retail.
C. The prohibition of computer on-line selling referenced in
Paragraph 2.A. includes, but is not limited to, the display,
promotion or offering of Articles in or on any on-line venues
(e.g. Websites), except as specifically permitted in the next
two sentences. Articles approved by Disney may be displayed
and promoted on Disney-controlled on-line venues, only within
the Territory. In addition, Articles approved by Disney may
be displayed and promoted on Licensee's own on-line venue,
and may be displayed, promoted and sold on authorized
Retailers' on-line venues, subject to Disney's applicable
policies and guidelines; however, Licensee must obtain
Disney's prior written approval of all creative and editorial
elements of such uses, in accordance with the provisions of
Paragraph 7 of this Agreement.
D. Unless Disney consents in writing, Licensee shall not give
away or donate Articles to Licensee's accounts or other
persons for the purpose of promoting sales of Articles,
except for minor quantities or samples which are not for
onward distribution.
E. Nothing contained herein shall preclude Licensee from selling
Articles to Disney or to any of Disney's Affiliates, or to
Licensee's or Disney's employees, subject to the payment to
Disney of Royalties on such sales.
X. Xxxxxx further grants Licensee the right to reproduce the
Licensed Material and to use the approved Trademarks, only
within the Territory, during the
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term of the relevant Schedule for each subject Property, on
containers, packaging and display material for the Articles,
and in advertising for the Articles.
G. Nothing contained in this Agreement shall be deemed to imply
any restriction on Licensee's freedom and that of Licensee's
customers to sell the Articles at such prices as Licensee or
they shall determine.
H. Licensee recognizes and acknowledges the vital importance to
Disney of the characters and other proprietary material
Disney owns and creates, and the association of the Disney
name with them. In order to prevent the denigration of
Disney's products and the value of their association with the
Disney name, and in order to ensure the dedication of
Licensee's best efforts to preserve and maintain that value,
Licensee agrees that, during the Term and any extension
hereof, Licensee will not manufacture or distribute any
merchandise embodying or bearing any artwork or other
representation which Disney determines, in Disney's
reasonable discretion, is confusingly similar to Disney's
characters or other proprietary material.
I. During the Term, and within the Territory, in order to ensure
Licensee's complete company-wide and highly focused
commitment to marketing and promoting the Articles and the
Disney Properties licensed hereunder, Licensee agrees that
neither Licensee nor its Affiliates will enter into any
license agreement during the Term for any other studio
properties, or characters therefrom, including but not
limited to book properties, classic characters, television
properties or major motion picture properties, whether live
action or animated, if such license agreement(s) has
significant merchandising potential, as determined by Disney
in its absolute discretion. [*](5)
3. ADVANCE
A. Licensee agrees to pay the Advance, which shall be on account
of Royalties to accrue during the term for the relevant
Schedule for each subject Property only, and only with
respect to sales in the Territory; provided, however, that if
any part of the Advance is specified as applying to any
period less than the entire term of the subject Schedule,
such part shall be on account of Royalties to accrue during
such lesser period only. If said Royalties should be less
than the Advance, no part of the Advance shall be repayable.
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(5) Confidential portions omitted and filed separately with the Commission.
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B. Royalties accruing during any sell-off period or extension of
the Term or any term of any relevant Schedule shall not be
offset against the Advance for any given Property unless
otherwise agreed in writing. Royalties accruing during any
extension of the Term or any other term shall be offset only
against an advance paid with respect to such extended term.
C. In no event shall Royalties accruing by reason of any sales
to Disney or any of Disney's Affiliates or by reason of sales
outside the Territory pursuant to a distribution permission
be offset against the Advance for any given Property or any
subsequent advance.
4. GUARANTEE
A. Licensee shall, with Licensee's statement for each Royalty
Payment Period ending on a date indicated in Paragraph 1.L.
hereof defining "Guarantee," or upon termination if the
Agreement or the relevant Schedule for the subject Property
is terminated prior to the end of the Term or the stated term
of such Schedule, as applicable, pay Disney the amount, if
any, by which cumulative Royalties paid with respect to sales
in the Territory during any period or periods covered by the
Guarantee provision, or any Guarantee provision contained in
any agreement extending the term hereof, fall short of the
amount of the Guarantee for such period.
B. Advances for a Property applicable to Royalties due on sales
in the period to which the Guarantee for said Property
relates apply towards meeting the Guarantee for that
Property.
C. In no event shall Royalties paid with respect to sales to
Disney or to any of Disney's Affiliates, or with respect to
sales outside the Territory pursuant to a distribution
permission, apply towards the meeting of any Guarantee or any
subsequent guarantee.
5. PRE-PRODUCTION APPROVALS
A. As early as possible, and in any case before commercial
production of any Article, Licensee shall submit to Disney
for Disney's review and written approval (to utilize such
materials in preparing a pre-production sample) all concepts,
all preliminary and proposed final artwork, and all three-
dimensional models which are to appear on or in any and all
SKUs of the Article. Thereafter, Licensee shall submit to
Disney for Disney's written approval a pre-production sample
of each SKU of each Article. Disney shall endeavor to respond
to such requests within a reasonable time, but such
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approvals should be sought as early as possible in case of
delays. In addition to the foregoing, as early as possible,
and in any case no later than sixty (60) days following
written conceptual approval, Licensee shall supply to Disney
for Disney's use for internal purposes, a mock-up, prototype
or pre-production sample of each SKU of each Article on or in
connection with which the Licensed Material is used. Licensee
acknowledges that Disney may not approve concepts or artwork
submitted near the end of the term of the relevant Schedule
for the subject Property. Any pre-production approval Disney
may give will not constitute or imply a representation or
belief by Disney that such materials comply with any
applicable Laws.
B. Approval or disapproval shall lie solely in Disney's
discretion, and any SKU of any Article not so approved in
writing shall be deemed unlicensed and shall not be
manufactured or sold. If any unapproved SKU of any Article is
being sold, Disney may, together with other remedies
available to Disney, including but not limited to, immediate
termination of this Agreement, by written notice require such
SKU of such Article to be immediately withdrawn from the
market. Any modification of any SKU of an Article, including,
but not limited to, change of materials, color, design or
size of the representation of Licensed Material must be
submitted in advance for Disney's written approval as if it
were a new SKU of an Article. Approval of any SKU of an
Article which uses particular artwork does not imply approval
of such artwork for use with a different Article. The fact
that artwork has been taken from a Disney publication or a
previously approved Article does not mean that its use will
necessarily be approved in connection with an Article
licensed hereunder.
C. If Licensee submits for approval artwork from an article or
book manufactured or published by another licensee of
Disney's or of any of Disney's Affiliates, Licensee must
advise Disney in writing of the source of such artwork. If
Licensee fails to do so, any approval which Disney may give
for use by Licensee of such artwork may be withdrawn by
giving Licensee written notice thereof, and Licensee may be
required by Disney not to sell Articles using such artwork.
D. Licensee is responsible for the consistent quality and safety
of the Articles and their compliance with applicable Laws.
Disney will not unreasonably object to any change in the
design of an Article or in the materials used in the
manufacture of the Article or in the process of manufacturing
the Articles which Licensee advises Disney in writing is
intended to make the Article safer or more durable.
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E. If Disney has supplied Licensee with forms for use in
applying for approval of artwork, models, pre-production and
production samples of Articles, Licensee shall use such forms
when submitting anything for Disney's approval.
X. Xxxxxx may, in its absolute discretion, waive some or all of
the foregoing approval requirements upon written notice to
Licensee.
G. If and as applicable, the likenesses and product application
of the characters used on or in connection with the Articles
are subject to any third party approvals Disney deems
necessary to obtain. Disney will act as the liaison with such
third parties during the approval process.
6. APPROVAL OF PRODUCTION SAMPLES
A. Unless advised by Disney in writing that Disney does not need
to approve any given production sample(s), before shipping an
Article to any customer, Licensee agrees to furnish to
Disney, from the first production run of each supplier of
each of the Articles, for Disney's approval of all aspects of
the Article in question, the number of Samples with packaging
which is hereinabove set forth, which shall conform to the
approved artwork, three- dimensional models and
pre-production sample. Approval or disapproval of the artwork
as it appears on any SKU of the Article, as well as of the
quality of the Article, shall lie in Disney's sole discretion
and may, among other things, be based on unacceptable quality
of the artwork or of the Article as manufactured. Any SKU of
any Article not so approved shall be deemed unlicensed, shall
not be sold and, unless otherwise agreed by Disney in
writing, shall be destroyed. Such destruction shall be
attested to in a certificate signed by one of Licensee's
officers. Production samples of Articles for which Disney has
approved a pre-production sample shall be deemed approved,
unless within twenty (20) days of Disney's receipt of such
production sample Disney notifies Licensee to the contrary.
Any approval of a production sample attributable to Disney
will not constitute or imply a representation or belief by
Disney that such production sample complies with any
applicable Laws.
B. Licensee agrees to make available at no charge such
additional samples of any or all SKUs of each Article as
Disney may from time to time reasonably request for the
purpose of comparison with earlier samples, or for Disney's
anti-piracy efforts, or to test for compliance with
applicable Laws, and to permit Disney to inspect Licensee's
manufacturing operations and testing
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records (and those of Licensee's Manufacturers) for the
Articles in accordance with Paragraphs 11 and 24.
C. Licensee acknowledges that Disney may disapprove any SKU of
an Article or a production run of any SKU of an Article
because the quality is unacceptable to Disney, and
accordingly, Disney recommends that Licensee submit
production samples to Disney for approval before committing
to a large original production run or to purchase a large
shipment from a new supplier.
D. No modification of an approved production sample shall be
made without Disney's further prior written approval. All
SKUs of Articles being sold must conform in all respects to
the approved production sample. It is understood that if in
Disney's reasonable judgment the quality of any SKU of an
Article originally approved has deteriorated in later
production runs, or if the SKU has otherwise been altered,
Disney may, in addition to other remedies available to
Disney, by written notice require such SKU of the Article to
be immediately withdrawn from the market.
E. Licensee is authorized to sell Articles which do not meet the
quality standards of approved samples provided that such
Articles are clearly marked "irregular" and provided they
have Licensee's uncut label on them. Such sales shall be
reported separately and the quantity of any Articles sold as
an irregular shall not exceed [*]6of the total of such
Article sold during the Term. All other Articles not meeting
the standard of approved samples shall be destroyed or all
Licensed Material and Trademarks shall be removed or
obliterated therefrom. If Licensee sells "irregulars" in
excess of the [*]7 limit set forth above, without limiting
Disney's remedies hereunder, Licensee agrees to pay Disney
Royalties on such sales as if such sales were regular sales
at Licensee's normal selling price for Articles. In the event
that Licensee is authorized to sell roll stock fabric as a
supplier to any other Disney licensee, Licensee shall not be
permitted, under any circumstances, to sell irregular roll
stock fabric.
F. Licensee shall only be entitled to sell and distribute
irregulars through those Retailers expressly approved by
Disney, said sales to be made in accordance with non-price
terms and conditions specified by Disney.
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(6) Confidential portions omitted and filed separately with the Commission.
(7) Confidential portions omitted and filed separately with the Commission.
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Accordingly, prior to selling and/or distributing any
irregulars to an authorized Retailer, Licensee shall provide
Disney with such information as Disney may request, to allow
Disney to determine whether such Retailer(s) have, in
Disney's absolute discretion, sufficient standards of quality
and a general business reputation acceptable to Disney.
Licensee shall provide all available information to Disney
when requesting approval of a potential Retailer of
irregulars. Disney shall have the right, in its absolute
discretion, to revoke any approval previously made with
respect to a Retailer of irregulars.
G. Articles may be classified as "irregulars" if there is an
irregularity (e.g., minor snag) in the fabric, but no
"seconds" or unsafe Articles may be sold whatsoever. In
addition, Articles flawed in the way in which the Licensed
Material is applied or depicted due to defective inking,
printing, coloring, etc., of the Licensed Material may not be
sold as "irregulars" pursuant to the foregoing, and instead
must be immediately destroyed (such destruction to be
attested to in a certificate signed by one of Licensee's
officers.)
H. Licensee is responsible for the consistent quality and safety
of the Articles and their compliance with applicable Laws.
Disney will not unreasonably object to any change in the
design of an Article or in the materials used in the
manufacture of the Article or in the process of manufacturing
the Articles which Licensee advises Disney in writing is
intended to make the Article safer or more durable.
I. Disney shall have the right, by written notice to Licensee,
to require modification of any SKU of any Article approved by
Disney under this or any previous agreement between the
parties pertaining to Licensed Material. Likewise, if the
Term of this Agreement is extended by mutual agreement,
Disney shall have the right, by written notice to Licensee,
to require modification of any SKU of any Article approved by
Disney under this Agreement. It is understood that there is
no obligation upon either party to extend the Agreement.
J. If Disney notifies Licensee of a required modification under
Paragraph 6.I. with respect to any SKU of a particular
Article, such notification shall advise Licensee of the
nature of the changes required, and Licensee shall not accept
any order for any such Article until the subject SKU has been
resubmitted to Disney with such changes and Licensee has
received Disney's written approval of the Article as
modified. However, Licensee may continue to distribute
Licensee's inventory of the previously approved Articles
until such inventory is exhausted (unless such Articles are
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dangerously defective or are alleged to be violative of any
third party rights, as determined by Disney).
K. Upon Disney's request, Licensee agrees to give Disney written
notice of the first ship date for each Article.
L. If Disney has inadvertently approved a concept,
pre-production sample, or production sample of a product
which is not included in the Articles under this Agreement,
or if Disney has inadvertently approved an Article using
artwork and/or trademarks not included in the Agreement, such
approval may be revoked at any time without any obligation
whatsoever on Disney's part to Licensee. Any such product as
to which Disney's approval is revoked shall be deemed
unauthorized and shall not be distributed or sold by or for
Licensee.
7. APPROVAL OF PACKAGING, PROMOTIONAL
MATERIAL, AND ADVERTISING
A. All containers, packaging, display material, promotional
material, catalogs, and all advertising, including but not
limited to, television advertising and press releases, for
Articles must be submitted to Disney and receive Disney's
written approval before use. To avoid unnecessary expense if
changes are required, Disney's approval thereof should be
procured when such is still in rough or storyboard format.
Disney shall endeavor to respond to requests for approval
within a reasonable time. Approval or disapproval shall lie
in Disney's sole discretion, and the use of unapproved
containers, packaging, display material, promotional
material, catalogs or advertising is prohibited. Disney's
approval of any containers, packaging, display material,
promotional material, catalogs or advertising under this
Agreement will not constitute or imply a representation or
belief by Disney that such materials comply with any
applicable Laws. Whenever Licensee prepares catalog sheets or
other printed matter containing illustrations of Articles,
Licensee will furnish to Disney five (5) copies thereof when
they are published.
B. If Disney has supplied Licensee with forms for use in
applying for approval of materials referenced in this
Paragraph 7, Licensee shall use such forms when submitting
anything for Disney's approval.
X. Xxxxxx has designed character artwork and/or a brand name
logo(s) to be used by all licensees in connection with the
packaging of all merchandise using the Licensed Material,
and, if applicable, on hang tags and garment
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labels for such merchandise. Disney will supply Licensee with
reproduction artwork thereof, and Licensee agrees to use such
artwork and/or logo(s) on the packaging of the Articles, and,
if applicable, on hang tags and garment labels, which
Licensee will have printed and attached to each Article at
Licensee's cost. Disney recommends that Licensee source the
hang tags and garment labels from Disney's authorized
manufacturer (if any) of pre-approved hang tags and garment
labels, the name of which will be provided to Licensee upon
request. However, Licensee may use another manufacturer for
the required hang tags and garment labels if the hang tags
and garment labels manufactured are of equivalent quality and
are approved by Disney in accordance with Disney's usual
approval process.
8. ARTWORK
Licensee shall pay Disney, within thirty (30) days of receiving an
invoice therefor, for Style Guides and for artwork done at Licensee's
request by Disney or third parties under contract to Disney in the
development and creation of Articles, display, packaging or
promotional material (including any artwork which in Disney's opinion
is necessary to modify artwork initially prepared by Licensee and
submitted to Disney for approval, subject to Licensee's prior written
approval) at Disney's then prevailing commercial art rates. Estimates
of artwork charges are available upon request. While Licensee is not
obligated to utilize the services of Disney's Art Department, Licensee
is encouraged to do so in order to minimize delays which may occur if
outside artists do renditions of Licensed Material which Disney cannot
approve and to maximize the attractiveness of the Articles. Artwork
will be returned to Licensee by overnight courier, at Licensee's cost
(unless other arrangements are made).
9. PRINT, RADIO OR TV ADVERTISING
Licensee will obtain all approvals necessary in connection with print,
radio or television advertising, if any, which Disney may authorize.
Licensee represents and warrants that all advertising and promotional
materials shall comply with all applicable Laws. Disney's approval of
copy or storyboards for such advertising will not constitute or imply
a representation or belief by Disney that such copy or storyboards
comply with any applicable Laws. This Agreement does not grant
Licensee any rights to use the Licensed Material in animation.
Licensee may not use any animation or live action footage from the
Property from which the Licensed Material comes without Disney's prior
written approval in each instance. In the event Disney approves the
use of film clips of the Property from which the Licensed Material
comes, for use in a television commercial, Licensee shall be
responsible for any re-use fees which may be applicable, including SAG
payments
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for talent. No reproduction of the film clip footage shall be made
except for inclusion, as approved by Disney, in such commercial and
there shall be no modifications of the film clip footage. All film
clip footage shall be returned to Disney immediately after its
inclusion in such commercial. Disney shall have the right to prohibit
Licensee from advertising the Articles by means of television and/or
billboards. Such right shall be exercised within Disney's absolute
discretion, including without limitation for reasons of overexposure
of the Licensed Material.
10. LICENSEE NAME AND ADDRESS ON ARTICLES
A. Licensee's name, trade name (or Licensee's trademark which
Licensee has advised Disney in writing that Licensee is
using) and Licensee's address (at least city and state) will
appear on permanently affixed labeling on each Article or, if
the Article is sold to the public in packaging or a
container, printed on such packaging or a container so that
the public can identify the supplier of the Article. On soft
goods "permanently affixed" shall mean sewn on; however,
permanently affixed stick-on labeling will be acceptable on
certain Articles as approved by Disney. RN numbers do not
constitute a sufficient label under this paragraph.
B. Licensee shall advise Disney in writing of all trade names or
trademarks Licensee wishes to use on Articles being sold
under this license. Licensee may sell the Articles only under
mutually agreed upon trade names or trademarks.
11. COMPLIANCE WITH APPROVED SAMPLES AND
APPLICABLE LAWS AND STANDARDS
A. Licensee covenants that each Article and component thereof
distributed hereunder shall be of good quality and free of
defects in design, materials and workmanship, and shall
comply with all applicable Laws, and such specifications, if
any, as may have been specified in connection with this
Agreement (e.g., Disney's Apparel Performance Specification
Manual, if the Articles are items of apparel), and shall
conform to the Sample thereof approved by Disney. Licensee
covenants that it will comply with all applicable Laws in
performing this Agreement, including but not limited to,
those pertaining to the manufacture, pricing, sale and
distribution of the Articles.
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B. Without limiting the foregoing, Licensee covenants on behalf
of Licensee's own manufacturing facilities, and agrees to
require all Manufacturers to covenant by signing the
Consent/Manufacturer's Agreement (referenced in Paragraph
24), as follows:
(1) Licensee and the Manufacturers agree not to use
child labor in the manufacturing, packaging or
distribution of Disney merchandise. The term
"child" refers to a person younger than the local
legal minimum age for employment or the age for
completing compulsory education, but in no case
shall any child younger than fifteen (15) years
of age (or fourteen (14) years of age where local
law allows) be employed in the manufacturing,
packaging or distribution of Disney merchandise.
Licensee and the Manufacturers employing young
persons who do not fall within the definition of
"children" agree also to comply with any Laws
applicable to such persons.
(2) Licensee and the Manufacturers agree only to
employ persons whose presence is voluntary.
Licensee and the Manufacturers agree not to use
any forced or involuntary labor, whether prison,
bonded, indentured or otherwise.
(3) Licensee and the Manufacturers agree to treat
each employee with dignity and respect, and not
to use corporal punishment, threats of violence,
or other forms of physical, sexual, psychological
or verbal harassment or abuse.
(4) Unless required by applicable Laws to treat a
specific group of employees differently, Licensee
and the Manufacturers agree not to discriminate
in hiring and employment practices, including
salary, benefits, advancement, discipline,
termination, or retirement, on the basis of race,
religion, age, nationality, social or ethnic
origin, sexual orientation, gender, political
opinion or disability.
(5) Licensee and the Manufacturers recognize that
wages are essential to meeting employees' basic
needs. Licensee and Manufacturers agree to
comply, at a minimum, with all applicable wage
and hour Laws, including minimum wage, overtime,
maximum hours, piece rates and other elements of
compensation, and to provide legally mandated
benefits. If local Laws do not provide for
overtime pay, Licensee and
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Manufacturers agree to pay at least regular wages
for overtime work. Except in extraordinary
business circumstances, Licensee and the
Manufacturers will not require employees to work
more than the lesser of (a) 48 hours per week and
12 hours overtime or (b) the limits on regular
and overtime hours allowed by local law, or,
where local law does not limit the hours of work,
the regular work week in such country plus 12
hours overtime. In addition, except in
extraordinary business circumstances, employees
will be entitled to at least one day off in every
seven-day period. Licensee and the Manufacturers
agree that, where local industry standards are
higher than applicable legal requirements, they
will meet the higher standards.
(6) Licensee and the Manufacturers agree to provide
employees with a safe and healthy workplace in
compliance with all applicable Laws, ensuring, at
a minimum, reasonable access to potable water and
sanitary facilities, fire safety, and adequate
lighting and ventilation. Licensee and the
Manufacturers also agree to ensure that the same
standards of health and safety are applied in any
housing they provide for employees. Licensee and
the Manufacturers agree to provide Disney with
all information Disney may request about
manufacturing, packaging and distribution
facilities for the Articles.
(7) Licensee and the Manufacturers agree to respect
the rights of employees to associate, organize
and bargain collectively in a lawful and peaceful
manner, without penalty or interference, in
accordance with applicable Laws.
(8) Licensee and the Manufacturers agree to comply
with all applicable environmental Laws.
(9) Licensee and the Manufacturers agree to comply
with all applicable Laws, including those
pertaining to the manufacture, pricing, sale and
distribution of the Articles.
(10) Licensee and the Manufacturers agree that Disney
and its designated agents (including third
parties) may engage in monitoring activities to
confirm compliance with this Paragraph 11,
including unannounced on-site inspections of
manufacturing, packaging and distribution
facilities, and employer-provided housing, such
inspections to include reviews of books and
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records relating to employment matters and
private interviews with employees. Licensee and
the Manufacturers agree to maintain on site all
documentation necessary to demonstrate compliance
with this Paragraph 11. Licensee agrees to
promptly reimburse Disney for the actual costs of
inspections performed pursuant to this Paragraph
11 when any of Licensee's manufacturing
facilities or any Manufacturer does not pass the
inspection(s).
(11) Licensee and the Manufacturers agree to take
appropriate steps to ensure that the provisions
of this Code of Conduct are communicated to
employees, including the prominent posting of a
copy of the Code of Conduct for Manufacturers
(copy attached) in the local language and in a
place readily accessible to employees at all
times.
C. Licensee agrees to take appropriate steps, in consultation
with Disney, to develop, implement and maintain procedures to
evaluate and monitor the Manufacturers it uses to manufacture
the Articles or components thereof, and to ensure compliance
with Paragraph 11.B., including but not limited to,
unannounced on-site inspections of manufacturing, packaging
and distribution facilities and employer-provided housing,
reviews of books and records relating to employment matters
and private interviews with employees.
D. Both before and after Licensee puts Articles on the market,
Licensee shall follow reasonable and proper procedures for
testing that Articles comply with all applicable product
safety Laws, and shall permit Disney's designees to inspect
testing, manufacturing and quality control records and
procedures and to test the Articles for compliance with
product safety and other applicable Laws. Licensee agrees to
promptly reimburse Disney for the actual costs of such
testing. Licensee shall also give due consideration to any
recommendations by Disney that Articles exceed the
requirements of applicable Laws. Articles not manufactured,
packaged or distributed in accordance with applicable Laws
shall be deemed unapproved, even if previously approved by
Disney, and shall not be shipped unless and until they have
been brought into full compliance therewith.
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12. DISNEY OWNERSHIP OF ALL RIGHTS IN LICENSED MATERIAL
Licensee acknowledges that the copyrights and all other proprietary
rights in and to Licensed Material are exclusively owned by and
reserved to Disney, or its licensors if applicable to any Property.
Licensee shall neither acquire nor assert copyright ownership or any
other proprietary rights in the Licensed Material or in any
derivation, adaptation, variation or name thereof. Without limiting
the foregoing, Licensee hereby assigns to Disney all Licensee's
worldwide right, title and interest in the Licensed Material and in
any material objects consisting of or to the extent that they
incorporate drawings, paintings, animation cels, or sculptures of
Licensed Material, or other adaptations, compilations, collective
works, derivative works, variations or names of Licensed Material,
heretofore or hereafter created by or for Licensee or any of
Licensee's Affiliates. All such new materials shall be included in the
definition of "Licensed Material" under this Agreement. If any third
party makes or has made any contribution to the creation of any new
materials which are included in the definition of Licensed Material
under this Paragraph 12, Licensee agrees to obtain from such party a
full assignment of rights so that the foregoing assignment by Licensee
shall vest full rights to such new materials in Disney. Licensee
further covenants that any such new materials created by Licensee or
by any third party Licensee has engaged are original to Licensee or
such third party and do not violate the rights of any other person or
entity; this covenant regarding originality shall not extend to any
materials Disney supplies to Licensee, but does apply to all materials
Licensee or Licensee's third party contractors may add thereto.
13. COPYRIGHT NOTICE
As a condition to the grant of rights hereunder, each Article and any
other matter containing Licensed Material shall bear a properly
located permanently affixed copyright notice in Disney's name (e.g.,
"C Disney"), or such other notice as Disney specifies to Licensee in
writing. Licensee will comply with such instructions as to form,
location and content of the notice as Disney may give from time to
time. Licensee will not, without Disney's prior written consent, affix
to any Article or any other matter containing Licensed Material a
copyright notice in any other name. If through inadvertence or
otherwise a copyright notice on any Article or other such matter
should appear in Licensee's name or the name of a third party,
Licensee hereby agrees to assign to Disney the copyright represented
by any such copyright notice in Licensee's name and, upon request,
cause the execution and delivery to Disney of whatever documents are
necessary to convey to Disney that copyright represented by any such
copyright notice. If by inadvertence a proper copyright notice is
omitted from any Article or other matter containing Licensed Material,
Licensee agrees at Licensee's expense to use all
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reasonable efforts to correct the omission on all such Articles or
other matter in process of manufacture or in distribution. Licensee
agrees to advise Disney promptly and in writing of the steps being
taken to correct any such omission and to make the corrections on
existing Articles which can be located.
14. NON-ASSOCIATION OF OTHER FANCIFUL
CHARACTERS WITH LICENSED MATERIAL
To preserve Disney's identification with Disney's characters and to
avoid confusion of the public, Licensee agrees not to associate other
characters or licensed properties with the Licensed Material or the
Trademarks either on the Articles or in their packaging, or, without
Disney's written permission, on advertising, promotional or display
materials. If Licensee wishes to use a character which constitutes
Licensee's trademark on the Articles or their packaging, or otherwise
in connection with the Articles, Licensee agrees to obtain Disney's
prior written permission.
15. ACTIVE MARKETING OF ARTICLES
Licensee agrees to manufacture (or have manufactured for Licensee) and
actively offer for sale all the Articles and to actively exercise the
rights granted herein. Licensee agrees that by the Marketing Date
applicable to a particular Article or, if such a date is not specified
in Paragraph 1.O., by six (6) months from the commencement of the term
of the applicable Schedule or the date of any applicable amendment,
shipments to customers of such Article will have taken place in
sufficient time that such Article shall be available for purchase in
commercial quantities by the public at the retail outlets in all
distribution channels authorized pursuant to Paragraph 2.A. In any
case in which such sales have not taken place or when the Article is
not then and thereafter available for purchase in commercial
quantities by the public, Disney may either invoke Disney's remedies
under Paragraph 28, or withdraw such Article from the list of Articles
licensed in this Agreement, or withdraw the applicable distribution
channel, or withdraw such Article from the applicable Schedule,
without obligation to Licensee other than to give Licensee written
notice thereof.
16. PROMOTION COMMITMENT
Licensee agrees to carry out the Promotion Commitment, if any, as
defined in Paragraph 1.N.
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17. TRADEMARK RIGHTS AND OBLIGATIONS
A. All uses of the Trademarks by Licensee hereunder shall inure
to Disney's benefit. Licensee acknowledges that Disney (or
its licensors, if applicable) is the exclusive owner of all
the Trademarks, and of any trademark incorporating all or any
part of a Trademark or any Licensed Material, and the
trademark rights created by such uses. Without limiting the
foregoing, Licensee hereby assigns to Disney all the
Trademarks, and any trademark incorporating all or any part
of a Trademark or any Licensed Material, and the trademark
rights created by such uses, together with the goodwill
attaching to that part of the business in connection with
which such Trademarks or trademarks are used. Licensee agrees
to execute and deliver to Disney such documents as Disney
requires to register Licensee as a Registered User or
Permitted User of the Trademarks or such trademarks and to
follow Disney's instructions for proper use thereof in order
that protection and/or registrations for the Trademarks and
such trademarks may be obtained or maintained.
B. Licensee agrees not to use any Licensed Material or
Trademarks, or any trademark incorporating all or any part of
a Trademark or of any Licensed Material, on any business
sign, business cards, stationery or forms (except as licensed
herein), or to use any Licensed Material or Trademark as the
name of Licensee's business or any division thereof, unless
otherwise agreed by Disney in writing.
C. Nothing contained herein shall prohibit Licensee from using
Licensee's own trademarks on the Articles or Licensee's
copyright notice on the Articles when the Articles contain
independent material which is Licensee's property. Nothing
contained herein is intended to give Disney any rights to,
and Disney shall not use, any trademark, copyright or patent
used by Licensee in connection with the Articles which is not
derived or adapted from Licensed Material, Trademarks, or
other materials owned by Disney (or its licensors, if
applicable).
18. REGISTRATIONS
Except with Disney's written consent, neither Licensee nor any of
Licensee's Affiliates will register or attempt in any country to
register copyrights in, or to register as a trademark, service xxxx,
design patent or industrial design, or business designation, any of
the Licensed Material, Trademarks or derivations or adaptations
thereof, or any word, symbol or design which is so similar thereto as
to suggest association with or sponsorship by Disney or any of
Disney's Affiliates.
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In the event of breach of the foregoing, Licensee agrees, at
Licensee's expense and at Disney's request, immediately to terminate
the unauthorized registration activity and promptly to execute and
deliver, or cause to be delivered, to Disney such assignments and
other documents as Disney may require to transfer to Disney all rights
to the registrations, patents or applications involved.
19. UNLICENSED USE OF LICENSED MATERIALS
A. Licensee agrees that Licensee will not use the Licensed
Material, or the Trademarks, or any other material the
copyright to which is owned by Disney in any way other than
as herein authorized (or as is authorized in any other
written contract in effect between the parties). In addition
to any other remedy Disney may have, Licensee agrees that all
revenues from any use thereof on products other than the
Articles (unless authorized by Disney in writing), and all
revenues from the use of any other copyrighted material of
Disney's (or its licensors', if applicable) without written
authorization, shall be immediately payable to Disney.
B. Licensee agrees to give Disney prompt written notice of any
unlicensed use by third parties of Licensed Material or
Trademarks, and that Licensee will not, without Disney's
written consent, bring or cause to be brought any criminal
prosecution, lawsuit or administrative action for
infringement, interference with or violation of any rights to
Licensed Material or Trademarks. Because of the need for and
the high costs of an effective anti-piracy enforcement
program, Licensee agrees to cooperate with Disney, and, if
necessary, to be named by Disney as a sole complainant or co-
complainant in any action against an infringer of the
Licensed Material or Trademarks and, notwithstanding any
right of Licensee to recover same, legal or otherwise,
Licensee agrees to pay to Disney, and hereby waives all
claims to, all damages or other monetary relief recovered in
such action by reason of a judgment or settlement whether or
not such damages or other monetary relief, or any part
thereof, represent or are intended to represent injury
sustained by Licensee as a licensee hereunder; in any such
action against an infringer, Disney agrees to reimburse
Licensee for reasonable expenses incurred at Disney's
request, including reasonable attorney's fees if Disney has
requested Licensee to retain separate counsel.
20. STATEMENTS AND PAYMENTS OF ROYALTIES
A. Licensee agrees to furnish to Disney by the 25th day after
each Royalty Payment Period full and accurate statements on
statement forms Disney designates for Licensee's use, showing
all information requested by such
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forms separately for each Property licensed hereunder,
including but not limited to, the name of the subject
Property, the quantities, Net Invoiced Xxxxxxxx and
applicable Royalty rate(s) of Articles using Licensed
Material from such Property invoiced during the preceding
Royalty Payment Period, and the quantities and invoice value
of Articles returned for credit or refund in such period. At
the same time Licensee will pay Disney all Royalties and CMF
payments (if applicable) due on xxxxxxxx shown by such
statements. To the extent that any Royalties or CMF payments
are not paid, Licensee authorizes Disney to offset Royalties
and/or CMF payments due against any sums which Disney or any
of Disney's Affiliates may owe to Licensee or any of
Licensee's Affiliates. No deduction or withholding from
Royalties payable to Disney shall be made by reason of any
tax. Any applicable tax on the manufacture, distribution and
sale of the Articles shall be borne by Licensee.
B. The statement forms Disney designates for Licensee's use may
be changed from time to time, and Licensee agrees to use the
most current form designated by Disney provides to Licensee
(including for example, forms to be sent by electronic
transmission). If it is necessary for Licensee to adapt its
system to be able to report statements by electronic
transmission, all costs of such adaptation shall be borne
entirely by Licensee. Licensee agrees to fully comply with
all instructions supplied by Disney for completing any
reporting forms, or adhering to any required format.
C. In addition to the other information requested by the
statement forms, and any special requirements stated in the
applicable Schedule for any Property licensed hereunder,
Licensee's statement shall with respect to all Articles
report separately:
(1) F.O.B. In Sales;
(2) F.O.B. Out Sales;
(3) sales of Articles outside the Territory pursuant
to a distribution permission (indicating the
country involved);
(4) Licensee's sales of Articles to any of Disney's
licensees or Disney's Affiliates' licensees who
are licensed to sell the Articles, and who are
reselling such Articles and paying Disney
royalties on such resales; in such cases,
Licensee needs only report the sales on the
statements, because double royalties are not owed
to Disney on these sales;
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(5) sales of Articles to Disney or any of Disney's
Affiliates;
(6) sales of Articles to Licensee's or Disney's
employees;
(7) sales of Articles using Licensed Material from
each brand or program, motion picture, television
series and other Property identified in Paragraph
1.B. hereinabove or in any Schedule attached
hereto;
(8) sales of Articles to or for distribution through
any mail order catalogs approved under this
Agreement.
D. Sales of items licensed under contracts with Disney other
than this Agreement shall not be reported on the same
statement as sales of Articles under this Agreement.
E. Licensee's statements and payments, including all Royalties,
shall be delivered to Wachovia South Metro Center, DEI
Account, X.X. Xxx 000000, Xxxxxxx, Xxxxxxx 00000. A copy of
each statement must be sent to Disney at 000 Xxxxx Xxxxx
Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxx 00000- 6687, to the
attention of the Contract Administrator, Consumer Products
Division. If Licensee wishes to send statements and payments
by overnight courier, please use the following address:
Wachovia South Metro Center, DEI Account, 0000 Xxxxxxx
Xxxxxx, Xxxxxxxxx, XX 00000, Attention Xxxxx Xxxxxx,
Reference Lock box 101947. However, Advances should be mailed
directly to Disney at 000 Xxxxx Xxxxx Xxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxxxx 00000-0000, to the attention of the Contract
Administrator or Legal Department, Consumer Products
Division.
F. Licensee shall take all necessary steps to ensure that its
information systems, including without limitation, all its
proprietary and all third party hardware and software,
process dates correctly prior to, during and after the
calendar year 2000 ("Year 2000 Compliance"). Year 2000
Compliance shall include, without limitation, correct century
recognition, calculations that properly accommodate same
century and multi-century formulas and date values, and
interface values that reflect the appropriate century.
Necessary steps to ensure Year 2000 Compliance shall include,
without limitation, analysis of all components of Licensee's
information systems and, as necessary, development,
installation and testing of software fixes, patches and/or
updates. In a timely manner, but no later than by December
31, 1998, Licensee shall certify to Disney in writing that
its information systems are Year 2000 Compliant. Such
certification is a
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material term of this Agreement. Upon a breach by Licensee of
its obligation under this paragraph, Disney shall be entitled
to terminate this Agreement in accordance with the provisions
for termination set forth herein.
G. Licensee has represented to Disney that its monthly
statements will be reported on an as close to actual basis,
but that certain adjustments may be necessary. Therefore, on
a calendar quarterly basis, Licensee shall be permitted to
reconcile the preceding three (3) months statements to
actuals, subject to providing to Disney appropriate
supporting documentation for any resulting adjustment to the
prior statements.
21. CONFIDENTIALITY
Licensee represents and warrants that Licensee did not disclose to any
third party the prospect of a license from Disney, and that Licensee
did not trade on the prospect of a license from Disney, prior to full
execution of this Agreement. Licensee agrees to keep the terms and
conditions of this Agreement confidential, and Licensee shall not
disclose such terms and conditions to any third party without
obtaining Disney's prior written consent; provided, however, that this
Agreement may be disclosed on a need-to-know basis to Licensee's
attorneys and accountants who agree to be bound by this
confidentiality provision. In addition, Licensee may have access to
information concerning Disney's and/or its Affiliates' business and
operations, and/or information concerning works in progress, artwork,
plots, characters or other matters relating to Disney's and/or its
Affiliates' artistic creations, which information may not be
accessible or known to the general public. Licensee agrees not to use
or disclose such information to any third party without obtaining
Disney's prior written consent.
22. INTEREST
Royalties or any other payments due to Disney hereunder which are
received after the due date shall bear interest at the rate of 18% per
annum from the due date (or the maximum permissible by law if less
than 18%).
23. AUDITS AND MAINTAINING RECORDS
A. Licensee agrees to keep accurate records of all transactions
relating to this Agreement and any prior agreement with
Disney regarding the Licensed Material, including, without
limitation, shipments to Licensee of Articles and components
thereof, inventory records, records of sales and shipments by
Licensee, and records of returns, and to preserve such
records for the
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lesser of seven (7) years or two (2) years after the
expiration or termination of this Agreement.
X. Xxxxxx, or Disney's representatives, shall have the right
from time to time, during Licensee's normal business hours,
but only for the purpose of confirming Licensee's performance
hereunder, to examine and make extracts from all such
records, including the general ledger, invoices and any other
records which Disney reasonably deems appropriate to verify
the accuracy of Licensee's statements or Licensee's
performance hereunder, including records of Licensee's
Affiliates and/or any unaffiliated sublicensees if they are
involved in activities which are the subject of this
Agreement. In particular, Licensee's invoices shall identify
the Articles separately from goods which are not licensed
hereunder. Licensee acknowledges that Disney may furnish
Licensee with an audit questionnaire, and Licensee agrees to
fully and accurately complete such questionnaire, and return
it to Disney within the designated time. Disney's use of an
audit questionnaire shall not limit Disney's ability to
conduct any on-site audit(s) as provided above. Licensee
acknowledges that an audit conducted by Disney or its
representatives, may involve one or more license agreements
at a time.
C. If in an audit of Licensee's records it is determined that
there is a short fall of five percent (5%) or more in
Royalties reported for any Royalty Payment Period, Licensee
shall upon request from Disney reimburse Disney for the full
out-of-pocket costs of the audit, including the costs of
employee auditors calculated at $60 per hour per person for
travel time during normal working hours and actual working
time.
D. If Licensee has failed to keep adequate records for one or
more Royalty Payment Periods, Disney will assume that the
Royalties owed to Disney for such Royalty Payment Period(s)
are equal to a reasonable amount, determined in Disney's
absolute discretion, which may be up to but will not exceed
the highest Royalties owed to Disney in a Royalty Payment
Period for which Licensee has kept adequate records; if
Licensee has failed to keep adequate records for any Royalty
Payment Period, Disney will assume a reasonable amount of
Royalties which Licensee will owe to Disney, based on the
records Licensee has kept and other reasonable assumptions
Disney deems appropriate.
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24. MANUFACTURE OF ARTICLES BY THIRD PARTY MANUFACTURERS
A. Licensee agrees to supply Disney with the names and addresses
of all of its own manufacturing facilities for the Articles.
If Licensee at any time desires to have Articles or
components thereof containing Licensed Material and/or
Trademarks manufactured by a third party, whether the third
party is located within or outside the United States,
Licensee must, as a condition to the continuation of this
Agreement, notify Disney of the accurate name and complete
address of such Manufacturer and the Articles or components
involved and obtain Disney's prior written permission to do
so. If Disney is prepared to grant permission, Disney will do
so if Licensee and each of Licensee's Manufacturers sign a
Consent/Manufacturer's Agreement in a form which Disney will
furnish to Licensee and Disney receives all such agreements
properly signed.
(A SAMPLE OF SAID AGREEMENT FORM IS AVAILABLE ON REQUEST)
B. It is not Disney's policy to reveal the names of Licensee's
Manufacturers to third parties or to any Disney division
involved with buying products, except as may be necessary to
enforce Disney's contract rights or protect Disney's
trademarks and copyrights.
C. If any such Manufacturer utilizes Licensed Material or
Trademarks for any unauthorized purpose, Licensee shall
cooperate fully in bringing such utilization to an immediate
halt. If, by reason of Licensee's not having supplied the
above mentioned agreements to Disney or not having given
Disney the name of any Manufacturer, Disney makes any
representation or takes any action and is thereby subjected
to any penalty or expense, Licensee will fully compensate
Disney for any cost or loss Disney sustains (in addition to
any other legal or equitable remedies available to Disney).
D. If any Manufacturer fails to pass a compliance inspection as
referenced in Paragraph 11, and thereafter fails to remedy
the cited failure(s) within the time designated by Disney, or
if the Manufacturer otherwise breaches the
Consent/Manufacturer's Agreement, the Consent/Manufacturer's
Agreement for such Manufacturer may be terminated immediately
by Disney, and Licensee shall not thereafter use such
Manufacturer to manufacture Articles or components thereof.
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25. INDEMNITY
A. Licensee shall indemnify Disney during and after the term
hereof against all claims, demands, suits, judgments, losses,
liabilities (including settlements entered into in good faith
with Licensee's consent, not to be unreasonably withheld) and
expenses of any nature (including reasonable attorneys' fees)
arising out of Licensee's activities under this Agreement,
including but not limited to, any actual or alleged: (1)
negligent acts or omissions on Licensee's part, (2) defect
(whether obvious or hidden and whether or not present in any
Sample approved by Disney) in an Article, (3) personal
injury, (4) infringement of any rights of any other person by
the manufacture, sale, possession or use of Articles, (5)
breach on Licensee's part of any covenant, representation or
warranty contained in this Agreement, or (6) failure of the
Articles or by Licensee to comply with applicable Laws. The
parties indemnified hereunder shall include Disney
Enterprises, Inc., its licensors, if applicable, and its and
their parent, Affiliates and successors, and its and their
officers, directors, employees and agents. The indemnity
shall not apply to any claim or liability relating to any
infringement of the copyright of a third party caused by
Licensee's utilization of the Licensed Material and the
Trademarks in accordance with the provisions hereof, unless
such claim or liability arises out of Licensee's failure to
obtain the full assignment of rights referenced in Paragraph
12.
X. Xxxxxx shall indemnify Licensee during and after the term
hereof against all claims, demands, suits, judgments, losses,
liabilities (including settlements entered into in good faith
with Disney's consent, not to be unreasonably withheld) and
expenses of any nature (including reasonable attorneys' fees)
arising out of any claim that Licensee's use of any
representation of the Licensed Material or the Trademarks
approved in accordance with the provisions of this Agreement
infringes the copyright of any third party or infringes any
right granted by Disney to such third party, except for
claims arising out of Licensee's failure to obtain the full
assignment of rights referenced in Paragraph 12. Licensee
shall not, in any case, be entitled to recover for lost
profits.
C. Additionally, if by reason of any claims referred to in
Paragraph 25.B., Licensee is precluded from selling any stock
of Articles or utilizing any materials in Licensee's
possession or which come into Licensee's possession by reason
of any required recall, Disney shall be obligated to purchase
such Articles and materials from Licensee at their
out-of-pocket cost to Licensee, excluding overheads, but
Disney shall have no other responsibility or liability with
respect to such Articles or materials.
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X. Xxxxxx gives no warranty or indemnity with respect to any
liability or expense arising from any claim that use of the
Licensed Material or the Trademarks on or in connection with
the Articles hereunder or any packaging, advertising or
promotional material infringes on any trademark right of any
third party or otherwise constitutes unfair competition by
reason of any prior rights acquired by such third party,
other than rights acquired from Disney. It is expressly
agreed that it is Licensee's responsibility to carry out such
investigations as Licensee may deem appropriate to establish
that Articles, packaging, and promotional and advertising
material which are manufactured or created hereunder,
including any use made of the Licensed Material and the
Trademarks therewith, do not infringe such right of any third
party, and Disney shall not be liable to Licensee if such
infringement occurs.
E. Licensee and Disney agree to give each other prompt written
notice of any claim or suit which may arise under the
indemnity provisions set forth above. Without limiting the
foregoing, Licensee agrees to give Disney written notice of
any product liability claim made or suit filed with respect
to any Article, any investigations or directives regarding
the Articles issued by the Consumer Product Safety Commission
("CPSC") or other federal, state or local consumer safety
agency, and any notices sent by Licensee to, or received by
Licensee from, the CPSC or other consumer safety agency
regarding the Articles within seven (7) days of Licensee's
receipt or promulgation of the claim, suit, investigation,
directive, or notice.
26. INSURANCE
Licensee shall maintain in full force and effect at all times while
this Agreement and all Schedules entered into hereunder are in effect
and for three years thereafter commercial general liability insurance
on a per occurrence form, including broad form coverage for
contractual liability, property damage, products liability and
personal injury liability (including bodily injury and death), waiving
subrogation, with minimum limits of no less than [*](8) per occurrence,
and naming as additional insureds those indemnified in Paragraph 25
hereof. Licensee also agrees to maintain in full force and effect at
all times while this Agreement and all Schedules entered into
hereunder are in effect such Worker's Compensation Insurance as is
required by applicable law and Employer's Liability Insurance with
minimum limits
-------------------------------------
(8) Confidential portions omitted and filed separately with the Commission.
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of [*](9) per occurrence. All insurance shall be primary and not
contributory. Licensee shall deliver to Disney a certificate or
certificates of insurance evidencing satisfactory coverage and
indicating that Disney shall receive thirty (30) days unrestricted
prior written notice of cancellation, non-renewal or of any material
change in coverage. Licensee's insurance shall be carried by an
insurer with a BEST Guide rating of B + VII or better. Compliance
herewith in no way limits Licensee's indemnity obligations, except to
the extent that Licensee's insurance company actually pays Disney
amounts which Licensee would otherwise pay Disney.
27. WITHDRAWAL OF LICENSED MATERIAL
Licensee agrees that Disney may, without obligation to Licensee other
than to give Licensee written notice thereof, withdraw from the scope
of this Agreement any Licensed Material which by the Marketing Date
or, if such a date is not specified in Paragraph 1.O., by six (6)
months from the commencement of the term of the applicable Schedule or
the date of any applicable amendment, is not being used on or in
connection with the Articles. Disney may also withdraw any Licensed
Material or Articles the use or sale of which under this Agreement
would infringe or reasonably be claimed to infringe the rights of a
third party, other than rights granted by Disney, in which case
Disney's obligations to Licensee shall be limited to the purchase at
cost of Articles and other materials utilizing such withdrawn Licensed
Material which cannot be sold or used. In the case of any withdrawal
under the preceding sentence, the Advances and Guarantees shall be
adjusted to correspond to the time remaining in the term of the
affected Schedule(s), or the number of Articles remaining under such
Schedule(s), at the date of withdrawal.
28. TERMINATION
Without prejudice to any other right or remedy available to Disney:
A. Disney shall have the right at any time to terminate this
Agreement (or any Schedule(s) entered into hereunder) by
giving Licensee written notice thereof, if Licensee fails to
manufacture, sell and distribute the Articles in accordance
with this Agreement, or fails to furnish statements and pay
Royalties as herein provided, or fails to notify Disney of
the accurate name and complete address of its own
manufacturing facilities or any Manufacturer of the Articles,
or fails to have any such Manufacturer execute the
Consent/Manufacturer's Agreement, or if Licensee otherwise
------------------------------------
(9) Confidential portions omitted and filed separately with the Commission.
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breaches the terms of this Agreement or any Schedule(s)
hereto, and if any such failure or other breach is not
corrected within fifteen (15) days after Disney sends
Licensee written notice thereof.
X. Xxxxxx shall have the right at any time to terminate this
Agreement immediately by giving Licensee written notice
thereof:
(1) if Licensee delivers to any customer without
Disney's written authorization merchandise
containing representations of Licensed Material
or other material the copyright or other
proprietary rights to which are owned by Disney
other than Articles listed herein and approved in
accordance with the provisions hereof;
(2) if Licensee delivers Articles outside the
Territory or knowingly sells Articles to a third
party for delivery outside the Territory, unless
pursuant to a written distribution permission or
separate written license agreement with Disney or
any of Disney's Affiliates;
(3) if a breach occurs which is of the same nature,
and which violates the same provision of this
Agreement, as a breach of which Disney has
previously given Licensee written notice;
(4) if Licensee breaches any material term of any
other license agreement between the parties, and
Disney terminates such agreement for cause;
(5) if Licensee shall make any assignment for the
benefit of creditors, or file a petition in
bankruptcy, or is adjudged bankrupt, or becomes
insolvent, or is placed in the hands of a
receiver, or if the equivalent of any such
proceedings or acts occurs, though known by some
other name or term;
(6) if Licensee is not permitted or is unable to
operate Licensee's business in the usual manner,
or is not permitted or is unable to provide
Disney with assurance satisfactory to Disney that
Licensee will so operate Licensee's business, as
debtor in possession or its equivalent, or is not
permitted, or is unable to otherwise meet
Licensee's obligations under this Agreement or to
provide Disney with assurance satisfactory to
Disney that Licensee will meet such obligations;
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(7) if Licensee breaches any covenant set forth in
Paragraph 11 of this Agreement; and/or
(8) if more than three Consent/Manufacturer's
Agreements are terminated in any twelve-month
period by Disney for the Manufacturers' failure
to pass compliance inspections as referenced in
Paragraphs 11 and 24.
29. RIGHTS AND OBLIGATIONS UPON EXPIRATION OR TERMINATION
A. Upon the expiration or termination of this Agreement, all
rights herein granted to Licensee shall revert to Disney, any
unpaid portion of the Guarantee shall be immediately due and
payable, and Disney shall be entitled to retain all
Royalties, CMF payments and other things of value paid or
delivered to Disney. Licensee agrees that the Articles shall
be manufactured during the term of each applicable Schedule
in quantities consistent with anticipated demand therefor so
as not to result in an excessive inventory build-up
immediately prior to the end of the term thereof. Licensee
agrees that from the expiration or termination of this
Agreement Licensee shall neither manufacture nor have
manufactured for Licensee any Articles, that Licensee will
deliver to Disney any and all artwork (including Style
Guides, animation cels and drawings) which may have been used
or created by Licensee in connection with this Agreement,
that Licensee will at Disney's option either sell to Disney
at cost or destroy or efface any molds, plates and other
items used to reproduce Licensed Material or Trademarks, and
that, except as hereinafter provided, Licensee will cease
selling Articles. Any unauthorized distribution of Articles
after the expiration or termination of this Agreement or any
applicable Schedule shall constitute copyright infringement.
B. If Licensee has any unsold Articles in inventory on the
expiration or termination date of the applicable Schedule,
Licensee shall provide Disney with a full statement of the
kinds and numbers of such unsold Articles. If such statement
has been provided to Disney and if Licensee has fully
complied with the terms of this Agreement, including the
payment of all Royalties due and the Guarantee, upon notice
from Disney Licensee shall have the right for a limited
period of three (3) calendar months from such expiration or
earlier termination date to sell off and deliver such
Articles as authorized under Paragraph 2.A. Licensee shall
furnish Disney statements covering such sales and pay Disney
Royalties in respect of such sales. Such Royalties shall not
be applied against the Advance or towards
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meeting the Guarantee. All rights and remedies available to
Disney during the Term shall be equally available to Disney
during the sell-off periods.
C. In recognition of Disney's interest in maintaining a stable
and viable market for the Articles during and after the Term
and any sell-off period, Licensee agrees to refrain from
"dumping" the Articles in the market during any sell- off
period granted to Licensee. "Dumping" shall mean the
distribution of product at volume levels significantly above
Licensee's prior sales practices with respect to the
Articles, and at price levels so far below Licensee's prior
sales practices with respect to the Articles as to disparage
the Articles; provided, however, that nothing contained
herein shall be deemed to restrict Licensee's ability to set
product prices at Licensee's discretion.
D. Except as otherwise agreed by Disney in writing, any
inventory of Articles in Licensee's possession or control
after the expiration or termination of the term of the
applicable Schedule hereof and of any sell-off period granted
hereunder shall be destroyed, or all Licensed Material and
Trademarks removed or obliterated therefrom.
E. If Disney supplies Licensee with forms regarding compliance
with this Paragraph 29, Licensee agrees to complete, execute
and return such forms to Disney expeditiously. Licensee
acknowledges that this will be necessary at the end of the
term of each Schedule entered into under this Agreement.
F. Notwithstanding any provision to the contrary, in the case of
termination under Paragraph 28.B. (5) or (6), in order to
protect the value of the Articles and to avoid any
disparagement of the Articles which could occur as a result
of the circumstances of termination, Disney shall have the
option, in Disney's absolute discretion, to purchase any or
all unsold Articles in Licensee's inventory on the
termination date at [*]10 over Licensee's cost of goods for
such Articles (not including overhead).
30. WAIVERS
A waiver by either party at any time of a breach of any provision of
this Agreement shall not apply to any breach of any other provision of
this Agreement, or imply that a breach of the same provision at any
other time has been or will be waived, or that this Agreement has been
in any way amended, nor shall any failure
-------------------------------------
(10) Confidential portions omitted and filed separately with the Commission.
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by either party to object to conduct of the other be deemed to waive
such party's right to claim that a repetition of such conduct is a
breach hereof.
31. PURCHASE OF ARTICLES BY DISNEY
If Disney wishes to purchase Articles, Licensee agrees to sell such
Articles to Disney or any of Disney's Affiliates at as low a price as
Licensee charges for similar quantities sold to Licensee's regular
customers and to pay Disney Royalties on any such sales.
32. NON-ASSIGNABILITY
A. This Agreement is personal to Licensee, who was specifically
chosen by Disney to be licensed hereunder because of
Licensee's particular expertise and ability to perform the
Agreement. Licensee shall not voluntarily or by operation of
law assign, sub-license, transfer, encumber or otherwise
dispose of all or any part of Licensee's interest in this
Agreement (including, but not limited to, any encumbrance of
the Articles) without Disney's prior written consent, to be
granted or withheld in Disney's absolute discretion. Any
attempted assignment, sub-license, transfer, encumbrance or
other disposal without such consent shall be void and shall
constitute a material default and breach of this Agreement.
"Transfer" within the meaning of this Paragraph 32 shall
include any merger or consolidation involving Licensee or any
directly or indirectly controlling Affiliate(s) of Licensee
("Controlling Affiliate); any sale or transfer of all or
substantially all of Licensee's or its Controlling
Affiliate(s)' assets; any transfer of Licensee's rights
and/or obligations hereunder to a division, business segment
or other entity different from the one specifically
referenced on page 1 hereof (or any sale or attempted sale of
Articles under a trademark or trade name of such division,
business segment or other entity); any public offering, or
series of public offerings, whereby a cumulative total of
thirty-three and one-third percent (33 1/3%) or more of the
voting stock of Licensee or its Controlling Affiliate(s) is
offered for purchase; and any acquisition, or series of
acquisitions, by any person or entity, or group of related
persons or entities, of a cumulative total of thirty-three
and one-third percent (33-1/3%) or more of the voting stock
of Licensee or its Controlling Affiliate(s), or the right to
vote such percentage (or, if Licensee is a partnership,
resulting in the transfer of thirty-three and one-third
percent (33 1/3%) or more of the profit and loss
participation in Licensee, or the occurrence of any of the
foregoing with respect to any general partner of Licensee).
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[*]11
B. Licensee agrees to provide Disney with at least thirty (30)
days prior written notice of any desired assignment of this
Agreement or other transfer as defined in Paragraph 32.A. At
the time Licensee gives such notice, Licensee shall provide
Disney with the information and documentation necessary to
evaluate the contemplated transaction. Disney's consent (if
given) to any assignment of this Agreement or other transfer
as defined in Paragraph 32.A. shall be subject to such terms
and conditions as Disney deems appropriate, including but not
limited to, payment of a transfer fee. The amount of the
transfer fee shall be determined by Disney based upon the
circumstances of the particular assignment or transfer,
taking into account such factors as the estimated value of
the license being assigned or otherwise transferred; the risk
of business interruption or loss of quality, production or
control Disney may suffer as a result of the assignment or
other transfer; the identity, reputation, creditworthiness,
financial condition and business capabilities of the proposed
assignee or other entity involved in the transfer; and
Disney's internal costs related to the assignment or other
transfer; provided, however, in no event shall the transfer
fee be in an amount less than [*]12. The foregoing transfer
fee shall not apply if this Agreement is assigned to one of
Licensee's Affiliates as part of a corporate reorganization
exclusively among some or all of the entities existing in
Licensee's corporate structure when this Agreement is signed;
provided, however, that Licensee must give Disney written
notice of such assignment and a description of the
reorganization. The provisions of this Paragraph 32 shall
supersede any conflicting provisions on this subject in any
merchandise license agreement previously entered into between
the parties for this Territory.
C. Licensee acknowledges that it has read and understands the
Transfer Fee Policy attached hereto, which governs transfer
fee procedures under this Agreement. The Transfer Fee Policy
is incorporated herein by this reference.
D. Notwithstanding Paragraphs 32.A. and B., Licensee may, upon
Disney's prior written consent, sublicense Licensee's rights
and/or obligations hereunder to any of Licensee's Affiliates,
provided that each such Affiliate
-----------------------------------
(11) Confidential portions omitted and filed separately with the Commission.
(12) Confidential portions omitted and filed separately with the Commission.
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agrees to be bound by all of the terms and conditions of this
Agreement, and provided that each such Affiliate agrees to
guarantee Licensee's full performance of this Agreement
(including but not limited to Paragraph 25) and to indemnify
Disney for any failure of such performance, and further
provided that Licensee and each such Affiliate agree to
provide Disney with satisfactory documentation of such
agreement(s), guarantee(s), and indemnification upon Disney's
request therefor. Licensee hereby represents and irrevocably
and unconditionally guarantees that any and all Affiliates
sublicensed hereunder will observe and perform all of
Licensee's obligations under this Agreement, including, but
not limited to, the provisions governing approvals, and
compliance with approved samples, applicable Laws, and all
other provisions hereof, and that they will otherwise adhere
strictly to all of the terms hereof and act in accordance
with Licensee's obligations hereunder. Any involvement of an
Affiliate in the activities which are the subject of this
Agreement shall be deemed carried on pursuant to such a
sublicense and thus covered by such guarantee; however,
unless Licensee has obtained Disney's consent to sublicense
an Affiliate in each instance, such Affiliate shall be deemed
to be included in the term "Licensee" for all purposes under
this Agreement, and Disney may treat such unapproved
involvement of the Affiliate as a breach of the Agreement. In
the event of any sublicense to an Affiliate hereunder, the
reference in Paragraph 32.A. to "Controlling Affiliate" shall
include such Affiliate sublicensee.
33. RELATIONSHIP
This Agreement does not provide for a joint venture, partnership,
agency or employment relationship between the parties, or any other
relationship than that of licensor and licensee.
34. CONSTRUCTION
The language of all parts of this Agreement shall in all cases be
construed as a whole, according to its fair meaning and not strictly
for or against any of the parties. Headings of paragraphs herein are
for convenience of reference only and are without substantive
significance.
35. MODIFICATIONS OR EXTENSIONS OF THIS AGREEMENT
Except as otherwise provided herein, this Agreement can only be
extended or modified by a writing signed by both parties; provided,
however, that certain
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modifications shall be effective if signed by the party to be charged
and communicated to the other party.
36. NOTICES
All notices which either party is required or may desire to serve upon
the other party shall be in writing, addressed to the party to be
served at the address set forth on page 1 of this Agreement, and may
be served personally or by depositing the same addressed as herein
provided (unless and until otherwise notified), postage prepaid, in
the United States mail. Such notice shall be deemed served upon
personal delivery or upon the date of mailing; provided, however, that
Disney shall be deemed to have been served with a notice of a request
for approval of materials under this Agreement only upon Disney's
actual receipt of the request and of any required accompanying
materials. Any notice sent to Disney hereunder shall be sent to the
attention of "Vice President, Licensing", unless Disney advises
Licensee in writing otherwise.
37. MUSIC
Music is not licensed hereunder. Any charges, fees or royalties
payable for music rights or any other rights not covered by this
Agreement shall be additional to the Royalties and covered by separate
agreement.
38. PREVIOUS AGREEMENTS
This Agreement, and any confidentiality agreement Licensee may have
signed pertaining to any of the Licensed Material, contains the entire
agreement between the parties concerning the subject matter hereof and
supersedes any pre-existing or contemporaneous agreement and any oral
or written communications between the parties.
39. CHOICE OF LAW AND FORUM
This Agreement shall be deemed to be an executory agreement entered
into in California and shall be governed and interpreted according to
the laws of the State of California applicable to contracts made and
to be fully performed in California. Any legal actions pertaining to
this Agreement shall be commenced within the State of California and
within either Los Angeles or Orange Counties, and Licensee hereby
waives trial by jury and consents to the jurisdiction of the courts
located in Los Angeles or Orange Counties.
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40. EQUITABLE RELIEF
Licensee acknowledges that Disney will have no adequate remedy at law
if Licensee continues to manufacture, sell, advertise, promote or
distribute the Articles upon the expiration or termination of the term
of any applicable Schedule under this Agreement. Licensee acknowledges
and agrees that, in addition to any and all other remedies available
to Disney, Disney shall have the right to have any such activity by
Licensee restrained by equitable relief, including, but not limited
to, a temporary restraining order, a preliminary injunction, a
permanent injunction, or such other alternative relief as may be
appropriate, without the necessity of Disney posting any bond.
41. GOODWILL
Licensee acknowledges that the rights and powers retained by Disney
hereunder are necessary to protect Disney's (or its licensors', if
applicable) copyrights and property rights, and, specifically, to
conserve Disney's (and its licensors', if applicable) goodwill and
good name, and the name "Disney", and therefore Licensee agrees that
Licensee will not allow the same to become involved in matters which
will, or could, detract from or impugn the public acceptance and
popularity thereof, or impair their legal status.
42. POWER TO SIGN
The parties warrant and represent that their respective
representatives signing this Agreement have full power and proper
authority to sign this Agreement and to bind the parties.
43. SURVIVAL OF OBLIGATIONS
The respective obligations of the parties under this Agreement, which
by their nature would continue beyond the termination, cancellation or
expiration of this Agreement, including but not limited to
indemnification, insurance, payment of Royalties, and Paragraph 29,
shall survive termination, cancellation or expiration of this
Agreement.
44. SEVERABILITY OF PROVISIONS
The terms of this Agreement are severable and the invalidity of any
term of this Agreement shall not affect the validity of any other
term.
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Please sign below under the word "Agreed". When signed by both parties
this shall constitute an agreement between Disney and Licensee.
AGREED:
DISNEY ENTERPRISES, INC.
By: /s/ Xxxxx Xxxxxxx
------------------------------------
Title: Vice President Licensing
---------------------------------
Date: April 24, 1998
----------------------------------
CROWN CRAFTS, INC.
By: /s/ E. Xxxxxxx Xxxxxxxx
------------------------------------
Title: Vice President
---------------------------------
40
TRANSFER FEE POLICY
As provided in Paragraph 32.B. of the License Agreement, it is Disney's policy
to charge a transfer fee in connection with any permitted assignment of the
license or other "transfer," as that term is defined in Paragraph 32.A. The
amount of the transfer fee is based on the circumstances of the particular
assignment or transfer, taking into account such factors as:
- the estimated value of the license being assigned or involved in the
transfer
- the risk of business interruption
- the risk of loss of quality, production or control
- the identity, reputation, creditworthiness, financial condition and
business capabilities of the proposed assignee or entity involved in
the transfer
- Disney's internal costs related to the assignment or transfer
No Licensee or any company involved with a Licensee in an assignment or
transfer situation should rely upon any express or implied verbal
representations that are purported to be made on Disney's behalf as to the
amount of any given fee to be assessed. Disney Licensing's Finance Department
will communicate the actual amount of the fee calculated in each approved
transaction.
In any prospective assignment or transfer situations, Licensees must inform the
persons and companies with which they are dealing that no assignment or
transfer may occur without Disney's prior written consent, to be granted or
withheld in Disney's absolute discretion, and that any approved transaction
will also entail a transfer fee. Licensees must give Disney at least 30 days
prior written notice of any desired assignment or other transfer, together with
any information and documentation necessary to evaluate the contemplated
transaction. Licensees should not endanger the closing of their desired
transactions by failing to comply with these provisions of the License
Agreement.
If Disney grants consent to a proposed transaction subject to the payment of a
transfer fee, and the transaction is concluded but the transfer fee is not paid
within the designated time, the subject License Agreement(s) shall
automatically terminate and any Guarantee shortfall(s) shall be immediately due
and payable to Disney. If Disney does not grant consent to a proposed
assignment or transfer and the Licensee nevertheless closes the transaction,
the subject License Agreement(s) shall automatically terminate and any
Guarantee shortfall(s) shall be immediately due and payable to Disney.
Disney's consent to any assignment or other transfer should in no way be
understood to be a guarantee or promise by Disney of a grant of any future
license(s), as those determinations will continue to be made on a contract by
contract basis.
41
CODE OF CONDUCT FOR MANUFACTURERS
At The Xxxx Disney Company, we are committed to:
- a standard of excellence in every aspect of our business and
in every corner of the world;
- ethical and responsible conduct in all of our operations;
- respect for the rights of all individuals; and
- respect for the environment.
We expect these same commitments to be shared by all manufacturers of Disney
merchandise. At a minimum, we require that all manufacturers of Disney
merchandise meet the following standards:
CHILD LABOR Manufacturers will not use child labor.
The term "child" refers to a person younger than 15
(or 14 where local law allows) or, if higher, the
local legal minimum age for employment or the age
for completing compulsory education.
Manufacturers employing young persons who do not
fall within the definition of "children" will also
comply with any laws and regulations applicable to
such persons.
INVOLUNTARY
LABOR Manufacturers will not use any forced or involuntary
labor, whether prison, bonded, indentured or
otherwise.
COERCION AND
HARASSMENT Manufacturers will treat each employee with dignity
and respect, and will not use corporal punishment,
threats of violence or other forms of physical,
sexual, psychological or verbal harassment or abuse.
NONDISCRIMINATION Manufacturers will not discriminate in hiring and
employment practices, including salary, benefits,
advancement, discipline, termination or retirement,
on the basis of race, religion, age, nationality,
social or ethnic origin, sexual orientation, gender,
political opinion or disability.
ASSOCIATION Manufacturers will respect the rights of employees
to associate, organize and bargain collectively in a
lawful and peaceful manner, without penalty or
interference.
HEALTH AND
SAFETY Manufacturers will provide employees with a safe and
healthy workplace in compliance with all applicable
laws and regulations, ensuring at a minimum,
reasonable access to potable water and sanitary
facilities, fire safety, and adequate lighting and
ventilation.
42
Manufacturers will also ensure that the same
standards of health and safety are applied in any
housing that they provide for employees.
COMPENSATION We expect manufacturers to recognize that wages are
essential to meeting employees' basic needs.
Manufacturers will, at a minimum, comply with all
applicable wage and hour laws and regulations,
including those relating to minimum wages, overtime,
maximum hours, piece rates and other elements of
compensation, and provide legally mandated benefits.
If local laws do not provide for overtime pay,
manufacturers will pay at least regular wages for
overtime work. Except in extraordinary business
circumstances, manufacturers will not require
employees to work more than the lesser of (a) 48
hours per week and 12 hours overtime or (b) the
limits on regular and overtime hours allowed by
local law or, where local law does not limit the
hours of work, the regular work week in such country
plus 12 hours overtime. In addition, except in
extraordinary business circumstances, employees will
be entitled to at least one day off in every
seven-day period.
Where local industry standards are higher than
applicable legal requirements, we expect
manufacturers to meet the higher standards.
PROTECTION OF THE
ENVIRONMENT Manufacturers will comply with all applicable
environmental laws and regulations.
OTHER LAWS Manufacturers will comply with all applicable
laws and regulations, including those pertaining to
the manufacture, pricing, sale and distribution of
merchandise.
All references to "applicable laws and regulations"
in this Code of Conduct include local and national
codes, rules and regulations as well as applicable
treaties and voluntary industry standards.
SUBCONTRACTING Manufacturers will not use subcontractors for the
manufacture of Disney merchandise or components
thereof without Disney's express written consent,
and only after the subcontractor has entered into a
written commitment with Disney to comply with this
Code of Conduct.
MONITORING AND
COMPLIANCE Manufacturers will authorize Disney and its
designated agents (including third parties) to
engage in monitoring activities to confirm
compliance with this Code of Conduct, including
unannounced on-site inspections of manufacturing
facilities and employer-provided housing; reviews of
books and records relating to employment matters;
and private interviews with employees. Manufacturers
will maintain on site all documentation that may be
needed to demonstrate compliance with this Code of
Conduct.
PUBLICATION Manufacturers will take appropriate steps to ensure
that the provisions of this Code of Conduct are
communicated to employees, including the prominent
posting of a copy of this Code of Conduct, in the
local language and in a place readily accessible to
employees, at all times.
43
CODE OF CONDUCT FOR LICENSEES
At The Xxxx Disney Company, we are committed to:
- a standard of excellence in every aspect of our business and in every
corner of the world;
- ethical and responsible conduct in all of our operations;
- respect for the rights of all individuals; and
respect for the environment.
We expect these same commitments to be shared by all Disney licensees and the
manufacturers with which they work in the production of Disney merchandise. At
a minimum, we require that all Disney licensees meet the following standards:
CONDUCT OF
MANUFACTURING Licensees that engage directly in the manufacturing
of Disney merchandise will comply with all of the
standards set forth in Disney's Code of Conduct for
Manufacturers, a copy of which is attached.
Licensees will ensure that each manufacturer other
than the licensee also enters into a written
commitment with Disney to comply with the standards
set forth in Disney's Code of Conduct for
Manufacturers.
Licensees will prohibit manufacturers from
subcontracting the manufacture of Disney merchandise
or components thereof without Disney's express
written consent, and only after the subcontractor
has entered into a written commitment with Disney to
comply with Disney's Code of Conduct for
Manufacturers.
MONITORING AND
COMPLIANCE Licensees will take appropriate steps, in
consultation with Disney, to develop, implement and
maintain procedures to evaluate and monitor
manufacturers of Disney merchandise and ensure
compliance with Disney's Code of Conduct for
Manufacturers, including unannounced on-site
inspections of manufacturing facilities and
employer-provided housing; review of books and
records relating to employment matters; and private
interviews with employees.
Licensees will authorize Disney and its designated
agents (including third parties) to engage in
similar monitoring activities to confirm Licensees'
compliance with this Code of Conduct. Licensees will
maintain on site all documentation that may be
needed to demonstrate such compliance.
44
CATALOG SCHEDULE
(LIST OF PRE-APPROVED CATALOGS)
MASS
[*]14
This Catalog Schedule is subject to change. Disney reserves the right to
add catalogs to or delete catalogs from the Catalog Schedule without prior
notice to Licensee. Licensee agrees to cease selling Articles to a deleted
catalog within sixty (60) days after written notice of the deletion. Disney
will consider new catalogs requested by Licensee on a case-by-case basis.
-------------------------------------
(14) Confidential portions omitted and filed separately with the Commission.
45
CATALOG SCHEDULE
(LIST OF PRE-APPROVED CATALOGS)
HOME FURNISHINGS/HOUSEWARES
[*]130
This Catalog Schedule is subject to change. Disney reserves the right to
add catalogs to or delete catalogs from the Catalog Schedule without prior
notice to Licensee. Licensee agrees to cease selling Articles to a deleted
catalog within sixty (60) days after written notice of the deletion. Disney
will consider new catalogs requested by Licensee on a case-by-case basis.
-----------------------------------
(130) Confidential portions omitted and filed separately with the Commission.
46
Schedule to License Agreement
1. Schedule #1 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: January 1, 1998.
3. Termination date of this Schedule: December 31, 2000.
4. Licensed Material: BABY MICKEY MOUSE, BABY XXXXXX MOUSE, BABY XXXXXX
DUCK, BABY DAISY DUCK, BABY PLUTO AND BABY GOOFY.
5. Trademarks: DISNEY BABIES.
6. Anticipated release date of Property: Not applicable.
7. Marketing Date(s): [*]131
8. (Royalty) Advance payment(s) and due date(s):
[*]132
9. (Royalty) Guarantee increments during the term of this Schedule:
[*]133
10. Royalty rate:
[*]134
11. Articles:
A. Infant Bedding
[*]135
B. Infant Accessories
--------
(131) Confidential portions omitted and filed separately with the Commission.
(132) Confidential portions omitted and filed separately with the Commission.
(133) Confidential portions omitted and filed separately with the Commission.
(134) Confidential portions omitted and filed separately with the Commission.
(135) Confidential portions omitted and filed separately with the Commission.
47
[*]136
C. Infant Blankets/Throws
[*]137
12. Distribution:
Licensee will sell the Articles only to the following Retailers in the
Territory for resale to the public in the Territory: [*]138
13. Special provisions, if any:
[*]139
When signed by both parties, this shall constitute a binding Schedule subject
to the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s Xxxxx Xxxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
-------------------------------- -----------------------------------
Title: Vice President Licensing Title: Vice President
----------------------------- --------------------------------
Date: April 24, 1998
------------------------------
--------
(136) Confidential portions omitted and filed separately with the Commission.
(137) Confidential portions omitted and filed separately with the Commission.
(138) Confidential portions omitted and filed separately with the Commission.
(139) Confidential portions omitted and filed separately with the Commission.
48
Schedule to License Agreement
1. Schedule #2 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: January 1, 1998.
3. Termination date of this Schedule: December 31, 2000.
4. Licensed Material: BABY MICKEY MOUSE, BABY XXXXXX MOUSE, BABY XXXXXX
DUCK, BABY DAISY DUCK, BABY PLUTO AND BABY GOOFY.
5. Trademarks: BABY MICKEY & CO.
6. Anticipated release date of Property: Not applicable.
7. Marketing Date(s): [*]140
8. (Royalty) Advance payment(s) and due date(s):
[*]141
9. (Royalty) Guarantee increments during the term of this Schedule:
[*]142
10. Royalty rate:
[*]143
11. Articles:
A. Infant Bedding
[*]144
B. Infant Accessories
-------------------------------------
(140) Confidential portions omitted and filed separately with the Commission.
(141) Confidential portions omitted and filed separately with the Commission.
(142) Confidential portions omitted and filed separately with the Commission.
(143) Confidential portions omitted and filed separately with the Commission.
(144) Confidential portions omitted and filed separately with the Commission.
49
[*]145
C. Infant Blankets/Throws
[*]146
12. Distribution:
Licensee will sell the Articles only to the following Retailers in the
Territory for resale to the public in the Territory: [*]147
13. Special provisions, if any:
[*]148
When signed by both parties, this shall constitute a binding Schedule subject
to the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s Xxxxx Xxxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
-------------------------------- ----------------------------------
Title: Vice President Licensing Title: Vice President
----------------------------- -------------------------------
Date: April 24, 1998
-------------------------------
------------------------------------
(145) Confidential portions omitted and filed separately with the Commission.
(146) Confidential portions omitted and filed separately with the Commission.
(147) Confidential portions omitted and filed separately with the Commission.
(148) Confidential portions omitted and filed separately with the Commission.
50
Schedule to License Agreement
-----------------------------
1. Schedule #3 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: January 1, 1998.
3. Termination date of this Schedule: December 31, 2000, although Licensee
acknowledges that in the case of Articles Numbers D.1 through D.5
Licensee's rights with respect to such Articles may only be exercised
from January 1, 1998, until December 31, 1998.
4. Licensed Material: WINNIE THE POOH, XXXXXXXXXXX XXXXX, PIGLET, RABBIT,
EEYORE, TIGGER, OWL, GOPHER, KANGA, AND ROO, ALL IN THE STYLE AS
DESIGNED BY DISNEY.
5. Trademarks: POOH (Juvenile).
6. Anticipated release date of Property: Not applicable.
7. Marketing Date(s): [*](149)
8. (Royalty) Advance payment(s) and due date(s):
[*](150)
9. (Royalty) Guarantee increments during the term of this Schedule:
[*](151)
10. Royalty rate:
[*](152)
11. Articles:
A. Infant Bedding
--------
(149) Confidential portions omitted and filed separately with the
Commission.
(150) Confidential portions omitted and filed separately with the
Commission.
(151) Confidential portions omitted and filed separately with the
Commission.
(152) Confidential portions omitted and filed separately with the
Commission.
51
[*](153)
B. Infant Accessories
[*](154)
C. Infant Blankets/Throws
[*](155)
D. Toddler Bedding
[*](156)
E. Juvenile
[*](157)
12. Distribution:
Licensee will sell the Articles only to the following Retailers in the
Territory for resale to the public in the Territory: [*](158)
13. Special provisions:
a. [*](159)
b. Copyright notice:
Without limiting the provisions of Paragraph 13 of the
Agreement, Licensee agrees to include on the Article, or the
packaging for the Article, or the hang tag for the Article (if
applicable), the following language: Based on the "Winnie The
Pooh" works, copyright X.X. Xxxxx and X.X. Xxxxxxx.
--------
(153) Confidential portions omitted and filed separately with the Commission.
(154) Confidential portions omitted and filed separately with the Commission.
(155) Confidential portions omitted and filed separately with the Commission.
(156) Confidential portions omitted and filed separately with the Commission.
(157) Confidential portions omitted and filed separately with the Commission.
(158) Confidential portions omitted and filed separately with the Commission.
(159) Confidential portions omitted and filed separately with the Commission.
52
When signed by both parties, this shall constitute a binding Schedule subject to
the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s/ Xxxxx Xxxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
---------------------------- -----------------------------
Title: Vice President Licensing Title: Vice President
------------------------- --------------------------
Date: April 24, 1998
--------------------------
53
Schedule to License Agreement
-----------------------------
1. Schedule #4 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: January 1, 1998.
3. Termination date of this Schedule: December 31, 2000.
4. Licensed Material: WINNIE THE POOH, XXXXXXXXXXX XXXXX, PIGLET, RABBIT,
EEYORE, TIGGER, OWL, GOPHER, KANGA, AND ROO, ALL IN THE STYLE AS
DESIGNED BY DISNEY.
5. Trademarks: POOH (Adult).
6. Anticipated release date of Property: Not applicable.
7. Marketing Date(s): [*](160)
8. (Royalty) Advance payment(s) and due date(s):
[*](161)
9. (Royalty) Guarantee increments during the term of this Schedule:
[*](162)
10. Royalty rates:
[*](163)
11. Articles:
[*](164)
12. Distribution:
----------
(160) Confidential portions omitted and filed separately with the Commission.
(161) Confidential portions omitted and filed separately with the Commission.
(162) Confidential portions omitted and filed separately with the Commission.
(163) Confidential portions omitted and filed separately with the Commission.
(164) Confidential portions omitted and filed separately with the Commission.
54
Licensee will sell the Articles only to the following Retailers in the
Territory for resale to the public in the Territory: [*](165)
13. Special provisions:
a. [*](166)
b. Copyright notice:
Without limiting the provisions of Paragraph 13 of the
Agreement, Licensee agrees to include on the Article, or the
packaging for the Article, or the hang tag for the Article (if
applicable), the following language: Based on the "Winnie The
Pooh" works, copyright X.X. Xxxxx and X.X. Xxxxxxx.
When signed by both parties, this shall constitute a binding Schedule subject to
the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s/ Xxxxx Xxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
---------------------------- ------------------------------
Title: Vice President Licensing Title: Vice President
------------------------- ---------------------------
Date: April 24, 1998
----------------
--------
(165) Confidential portions omitted and filed separately with the Commission.
(166) Confidential portions omitted and filed separately with the Commission.
55
Schedule to License Agreement
-----------------------------
1. Schedule #5 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: January 1, 1998.
3. Termination date of this Schedule: December 31, 2000.
4. Licensed Material: WINNIE THE POOH, XXXXXXXXXXX XXXXX, PIGLET, RABBIT,
EEYORE, TIGGER, OWL, GOPHER, KANGA, AND ROO, ALL IN THE STYLE AS
DESIGNED BY DISNEY.
5. Trademarks: POOH 100 ACRE COLLECTION (Adult and Juvenile brands).
6. Anticipated release date of Property: Not applicable.
7. Marketing Date(s): [*](167)
8. (Royalty) Advance payment(s) and due date(s):
[*](168)
9. (Royalty) Guarantee increments during the term of this Schedule:
[*](169)
10. Royalty rate:
[*](170)
11. Articles:
A. Infant Bedding
[*](171)
--------
(167) Confidential portions omitted and filed separately with the Commission.
(168) Confidential portions omitted and filed separately with the Commission.
(169) Confidential portions omitted and filed separately with the Commission.
(170) Confidential portions omitted and filed separately with the Commission.
(171) Confidential portions omitted and filed separately with the Commission.
56
B. Infant Accessories
[*](172)
C. Infant Blankets/Throws
[*](173)
D. Juvenile/Adult
[*](174)
12. Distribution:
Licensee will sell the Articles only to the following Retailers in the
Territory for resale to the public in the Territory: [*](175)
13. Special provisions:
a. [*](176)
b. Copyright notice:
Without limiting the provisions of Paragraph 13 of the
Agreement, Licensee agrees to include on the Article, or the
packaging for the Article, or the hang tag for the Article (if
applicable), the following language: Based on the "Winnie The
Pooh" works, copyright X.X. Xxxxx and X.X. Xxxxxxx.
When signed by both parties, this shall constitute a binding Schedule subject to
the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s/ Xxxxx Xxxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
----------------------------- --------------------------
Title: Vice President Licensing Title: Vice President
--------------------------- ------------------------
Date: April 24, 1998
---------------------------
--------
(172) Confidential portions omitted and filed separately with the Commission.
(173) Confidential portions omitted and filed separately with the Commission.
(174) Confidential portions omitted and filed separately with the Commission.
(175) Confidential portions omitted and filed separately with the Commission.
(176) Confidential portions omitted and filed separately with the Commission.
57
Schedule to License Agreement
-----------------------------
1. Schedule #6 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: January 1, 1998.
3. Termination date of this Schedule: December 31, 2000.
4. Licensed Material: Characters from the stories by the late X.X. Xxxxx
entitled "Winnie The Pooh," "The House At Pooh Corner," "When We Were
Very Young," and "Now We Are Six" as drawn by the late X.X. Xxxxxxx for
the purpose of illustrating the stories.
5. Trademarks: CLASSIC POOH.
6. Anticipated release date of Property: Not applicable.
7. Marketing Date(s): [*](177)
8. (Royalty) Advance payment(s) and due date(s):
[*](178)
9. (Royalty) Guarantee increments during the term of this Schedule:
[*](179)
10. Royalty rate:
[*](180)
11. Articles:
A. Infant Bedding
[*](181)
--------
(177) Confidential portions omitted and filed separately with the
Commission.
(178) Confidential portions omitted and filed separately with the
Commission.
(179) Confidential portions omitted and filed separately with the
Commission.
(180) Confidential portions omitted and filed separately with the
Commission.
(181) Confidential portions omitted and filed separately with the
Commission.
58
B. Infant Accessories
[*](182)
C. Infant Blankets/Throws
[*](183)
D. Juvenile/Adult
[*](184)
12. Distribution:
Licensee will sell the Articles only to the following Retailers in the
Territory for resale to the public in the Territory: [*](185)
13. Special provisions:
a. [*](186)
b. Copyright notice:
Without limiting the provisions of Paragraph 13 of the
Agreement, Licensee agrees to include on the Article, or the
packaging for the Article, or the hang tag for the Article (if
applicable), the following language: Based on the "Winnie The
Pooh" works, copyright X.X. Xxxxx and X.X. Xxxxxxx.
When signed by both parties, this shall constitute a binding Schedule subject to
the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s/ Xxxxx Xxxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
----------------------------- --------------------------
Title: Vice President Licensing Title: Vice President
--------------------------- ------------------------
Date: April 24, 1998
---------------------------
--------
(182) Confidential portions omitted and filed separately
with the Commission.
(183) Confidential portions omitted and filed separately with the
Commission.
(184) Confidential portions omitted and filed separately with the
Commission.
(185) Confidential portions omitted and filed separately with the
Commission.
(186) Confidential portions omitted and filed separately with the
Commission.
59
Schedule to License Agreement
1. Schedule #7 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: January 1, 1998.
3. Termination date of this Schedule: December 31, 2000.
4. Licensed Material: MICKEY MOUSE, XXXXXX MOUSE, XXXXXX DUCK, DAISY DUCK,
PLUTO AND GOOFY (BUT NOT SPORT GOOFY).
5. Trademarks: MICKEY & CO.
6. Anticipated release date of Property: Not applicable.
7. Marketing Date(s): [*]187
8. (Royalty) Advance payment(s) and due date(s):
[*]188
9. (Royalty) Guarantee increments during the term of this Schedule:
[*]189
10. Royalty rate:
[*]190
11. Articles:
[*]191
12. Distribution:
--------
187 Confidential portions omitted and filed separately with the Commission.
188 Confidential portions omitted and filed separately with the Commission.
189 Confidential portions omitted and filed separately with the Commission.
190 Confidential portions omitted and filed separately with the Commission.
191 Confidential portions omitted and filed separately with the Commission.
60
Licensee will sell the Articles only to the following Retailers in the
Territory for resale to the public in the Territory: [*]192
When signed by both parties, this shall constitute a binding Schedule subject
to the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s Xxxxx Xxxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
------------------------------ --------------------------------
Title: Vice President Licensing Title: Vice President
--------------------------- -----------------------------
Date: April 24, 1998
----------------------------
------------------------------------
(192) Confidential portions omitted and filed separately with the Commission.
61
Schedule to License Agreement
1. Schedule #8 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: January 1, 1998.
3. Termination date of this Schedule: December 31, 2000.
4. Licensed Material: MICKEY MOUSE, XXXXXX MOUSE, XXXXXX DUCK, DAISY
DUCK, PLUTO AND GOOFY (BUT NOT SPORT GOOFY).
5. Trademarks: MICKEY FOR KIDS.
6. Anticipated release date of Property: Not applicable.
7. Marketing Date(s): [*]193
8. (Royalty) Advance payment(s) and due date(s):
[*]194
9. (Royalty) Guarantee increments during the term of this Schedule:
[*]195
10. Royalty rate:
[*]196
11. Articles:
[*]197
-------------------------------------------
(193) Confidential portions omitted and filed separately with the Commission.
(194) Confidential portions omitted and filed separately with the Commission.
(195) Confidential portions omitted and filed separately with the Commission.
(196) Confidential portions omitted and filed separately with the Commission.
(197) Confidential portions omitted and filed separately with the Commission.
62
12. Distribution:
Licensee will sell the Articles only to the following Retailers in the
Territory for resale to the public in the Territory: [*]198
When signed by both parties, this shall constitute a binding Schedule subject
to the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s/ Xxxxx Xxxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
------------------------------- ---------------------------------
Title: Vice President Licensing Title: Vice President
---------------------------- ------------------------------
Date: April 24, 1998
-----------------------------
------------------------
(198) Confidential portions omitted and filed separately with the Commission.
63
Schedule to License Agreement
1. Schedule #9 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: January 1, 1998.
3. Termination date of this Schedule: December 31, 2000.
4. Licensed Material: MICKEY MOUSE, XXXXXX MOUSE, XXXXXX DUCK, DAISY
DUCK, PLUTO AND GOOFY (BUT NOT SPORT GOOFY).
5. Trademarks: MICKEY UNLIMITED.
6. Anticipated release date of Property: Not applicable.
7. Marketing Date(s): [*]199
8. (Royalty) Advance payment(s) and due date(s):
[*]200
9. (Royalty) Guarantee increments during the term of this Schedule:
[*]201
10. Royalty rate:
[*]202
11. Articles:
[*]203
12. Distribution:
---------------------------
(199) Confidential portions omitted and filed separately with the Commission.
(200) Confidential portions omitted and filed separately with the Commission.
(201) Confidential portions omitted and filed separately with the Commission.
(202) Confidential portions omitted and filed separately with the Commission.
(203) Confidential portions omitted and filed separately with the Commission.
64
Licensee will sell the Articles only to the following Retailers in the
Territory for resale to the public in the Territory: [*]204
When signed by both parties, this shall constitute a binding Schedule subject
to the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s/ Xxxxx Xxxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
------------------------------- ----------------------------------
Title: Vice President Licensing Title: Vice President
---------------------------- -------------------------------
Date: April 24, 1998
-----------------------------
--------------------------
(204) Confidential portions omitted and filed separately with the Commission.
65
Schedule to License Agreement
1. Schedule #10 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: January 1, 1998.
3. Termination date of this Schedule: December 31, 1999.
4. Licensed Material: DISNEY'S MULAN characters, but only such
characters and depictions of such characters, and accompanying design
elements, as may be designated by Disney.
5. Trademarks: DISNEY'S MULAN.
6. Anticipated release date of Property: To be determined. When the
actual release date of the motion picture is determined, Licensee
shall be advised of such date in writing.
7. Marketing Date: [*]205
8. (Royalty) Advance payment and due date:
[*]206
9. (Royalty) Guarantee increments during the term of this Schedule:
[*]207
10. Royalty rate:
[*]208
11. Articles:
[*]209
--------
(205) Confidential portions omitted and filed separately with the Commission.
(206) Confidential portions omitted and filed separately with the Commission.
(207) Confidential portions omitted and filed separately with the Commission.
(208) Confidential portions omitted and filed separately with the Commission.
(209) Confidential portions omitted and filed separately with the Commission.
66
12. Distribution:
Licensee will sell the Articles only to Retailers in the Territory for
resale to the public in the Territory. [*]210
When signed by both parties, this shall constitute a binding Schedule subject
to the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s/ Xxxxx Xxxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
------------------------------- -----------------------------------
Title: Vice President Licensing Title: Vice President
---------------------------- --------------------------------
Date: April 24, 1998
----------------------------
-------------------------------------
(210) Confidential portions omitted and filed separately with the Commission.
67
Schedule to License Agreement
1. Schedule #11 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: January 1, 1998.
3. Termination date of this Schedule: June 30, 2000.
4. Licensed Material: DISNEY'S THE LION KING - SIMBA'S PRIDE characters,
but only such characters and depictions of such characters, and
accompanying design elements, as may be designated by Disney.
5. Trademarks: DISNEY'S THE LION KING - SIMBA'S PRIDE.
6. Anticipated release date of Property: To be determined. When the
actual direct-to-home video release date is determined, Licensee shall
be advised of such date in writing.
7. Marketing Date: [*]211
8. (Royalty) Advance payment and due date:
[*]212
9. (Royalty) Guarantee increments during the term of this Schedule:
[*]213
10. Royalty rate:
[*]214
11. Articles:
[*]215
-------------------------------------
(211) Confidential portions omitted and filed separately with the Commission.
(212) Confidential portions omitted and filed separately with the Commission.
(213) Confidential portions omitted and filed separately with the Commission.
(214) Confidential portions omitted and filed separately with the Commission.
(215) Confidential portions omitted and filed separately with the Commission.
68
12. Distribution:
Licensee will sell the Articles only to Retailers in the Territory for
resale to the public in the Territory. [*]216
When signed by both parties, this shall constitute a binding Schedule subject
to the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s/ Xxxxx Xxxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
-------------------------------- -----------------------------------
Title: Vice President Licensing Title: Vice President
----------------------------- --------------------------------
Date: April 24, 1998
------------------------------
---------------------
(216) Confidential portions omitted and filed separately with the Commission.
69
Schedule to License Agreement
1. Schedule #12 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: January 1, 1998.
3. Termination date of this Schedule: June 30, 2000.
4. Licensed Material: A BUG'S LIFE characters, but only such characters
and depictions of such characters, and accompanying design elements,
as may be designated by Disney.
5. Trademarks: A BUG'S LIFE.
6. Anticipated release date of Property: To be determined. When the
actual release date of the motion picture is determined, Licensee
shall be advised of such date in writing.
7. Marketing Date: [*]217
8. (Royalty) Advance payment and due date:
[*]218
9. (Royalty) Guarantee increments during the term of this Schedule:
[*]219
10. Royalty rate:
[*]220
11. Articles:
[*]221
-------------------------------
(217) Confidential portions omitted and filed separately with the Commission.
(218) Confidential portions omitted and filed separately with the Commission.
(219) Confidential portions omitted and filed separately with the Commission.
(220) Confidential portions omitted and filed separately with the Commission.
(221) Confidential portions omitted and filed separately with the Commission.
70
12. Distribution:
Licensee will sell the Articles only to Retailers in the Territory for
resale to the public in the Territory. [*]222
13. Special Provisions:
a. Hang tags:
Hang tags must have the artwork title of the motion picture
on the first line, and "A Disney/Pixar Production" on the
second line.
b. Copyright notice:
Without limiting the provisions of Paragraph 13 of the
Agreement, the Articles shall display a copyright notice in
Disney's and Pixar Animation Studios' names (e.g., "(C)
Disney Enterprises, Inc., and Pixar Animation Studios" or, if
space is limited, "(C) Disney/Pixar").
c. Statements and Payments of Royalties:
In addition to the information required in Paragraph 20 of
the Agreement, Licensee must separately report sales of
Articles by SKU and character.
When signed by both parties, this shall constitute a binding Schedule subject
to the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s Xxxxx Xxxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
-------------------------------- -----------------------------------
Title: Vice President Licensing Title: Vice President
----------------------------- --------------------------------
Date: April 24, 1998
------------------------------
-----------------------------
(222) Confidential portions omitted and filed separately with the Commission.
71
Schedule to License Agreement
1. Schedule #13 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: January 1, 1998.
3. Termination date of this Schedule: December 31, 2000.
4. Licensed Material: Characters from the Disney animated motion picture
to be released for Summer 1999 (to be determined), but only such
characters and depictions of such characters, and accompanying design
elements, as may be designated by Disney.
5. Trademarks: To be determined.
6. Anticipated release date of Property: To be determined. When the
actual release date of the motion picture is determined, Licensee
shall be advised of such date in writing.
7. Marketing Date: [*]223
8. (Royalty) Advance payment and due date:
[*]224
9. (Royalty) Guarantee increments during the term of this Schedule:
[*]225
10. Royalty rate:
[*]226
11. Articles:
[*]227
--------
(223) Confidential portions omitted and filed separately with the Commission.
(224) Confidential portions omitted and filed separately with the Commission.
(225) Confidential portions omitted and filed separately with the Commission.
(226) Confidential portions omitted and filed separately with the Commission.
(227) Confidential portions omitted and filed separately with the Commission.
72
12. Distribution:
Licensee will sell the Articles only to Retailers in the Territory for
resale to the public in the Territory. [*]228
13. Special Provisions:
The parties recognize that due to the fact that the identity of the
Property that is the subject of this Schedule is presently
undetermined, certain special provisions may need to be added to this
Schedule, and/or certain provisions hereof may need to be revised,
based on the specific terms and conditions as may be applicable to the
actual Property when determined. The parties hereby agree to amend
this Schedule accordingly, at such time as the Property has been
identified.
When signed by both parties, this shall constitute a binding Schedule subject
to the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s/ Xxxxx Xxxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
-------------------------------- ----------------------------------
Title: Vice President Licensing Title: Vice President
----------------------------- -------------------------------
Date: April 24, 1998
------------------------------
--------
(228) Confidential portions omitted and filed separately with the Commission.
73
Schedule to License Agreement
1. Schedule #14 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: July 1, 1998.
3. Termination date of this Schedule: June 30, 2001.
4. Licensed Material:TOY STORY II characters, but only such characters
and depictions of such characters, and accompanying design elements,
as may be designated by Disney.
5. Trademarks: TOY STORY II
6. Anticipated release date of Property: To be determined. When the
actual release date of the motion picture is determined, Licensee
shall be advised of such date in writing.
7. Marketing Date: [*]229
8. (Royalty) Advance payment and due date:
[*]230
9. (Royalty) Guarantee increments during the term of this Schedule:
[*]231
10. Royalty rate:
[*]232
11. Articles:
[*]233
----------------------------
(229) Confidential portions omitted and filed separately with the Commission.
(230) Confidential portions omitted and filed separately with the Commission.
(231) Confidential portions omitted and filed separately with the Commission.
(232) Confidential portions omitted and filed separately with the Commission.
(233) Confidential portions omitted and filed separately with the Commission.
74
12. Distribution:
Licensee will sell the Articles only to Retailers in the Territory for
resale to the public in the Territory. [*]234
13. Special Provisions:
a. Hang tags:
Hang tags must have the artwork title of the motion picture
on the first line, and "A Disney/Pixar Production" on the
second line.
b. Copyright notice:
Without limiting the provisions of Paragraph 13 of the
Agreement, the Articles shall display a copyright notice in
Disney's and Pixar Animation Studios' names (e.g., "(C)
Disney Enterprises, Inc., and Pixar Animation Studios" or, if
space is limited, "(C) Disney/Pixar").
c. Statements and Payments of Royalties:
In addition to the information required in Paragraph 20 of
the Agreement, Licensee must separately report sales of
Articles by SKU and character.
When signed by both parties, this shall constitute a binding Schedule subject
to the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s/ Xxxxx Xxxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
------------------------------- ----------------------------------
Title: Vice President Licensing Title: Vice President
---------------------------- -------------------------------
Date: April 24, 1998
-----------------------------
--------
(234) Confidential portions omitted and filed separately with the Commission.
75
Schedule to License Agreement
1. Schedule #15 to License Agreement Dated January 1, 1998 between Disney
Enterprises, Inc. and CROWN CRAFTS, INC. ("Agreement").
2. Effective date of this Schedule: January 1, 1998.
3. Termination date of this Schedule: December 31, 2000.
4. Licensed Material: DISNEY CLASSICS, comprised of the following
properties (collectively, the "Disney Classics Properties"):
(1) XXXX XXXXXX'X BAMBI characters, but only such characters and
depictions of such characters, and accompanying design
elements, as may be designated by Disney;
(2) XXXX XXXXXX'X SLEEPING BEAUTY characters, but only such
characters and depictions of such characters, and
accompanying design elements, as may be designated by Disney;
(3) XXXX XXXXXX'X SNOW WHITE AND THE SEVEN DWARFS characters, but
only such characters and depictions of such characters, and
accompanying design elements, as may be designated by Disney;
(4) XXXX XXXXXX'X THE JUNGLE BOOK characters, but only such
characters and depictions of such characters, and
accompanying design elements, as may be designated by Disney;
(5) XXXX XXXXXX'X CINDERELLA characters, but only such characters
and depictions of such characters, and accompanying design
elements, as may be designated by Disney;
(6) XXXX XXXXXX'X DUMBO characters, but only such characters and
depictions of such characters, and accompanying design
elements, as may be designated by Disney;
(7) XXXX XXXXXX'X LADY AND THE TRAMP characters, but only such
characters and depictions of such characters, and
accompanying design elements, as may be designated by Disney;
(8) XXXX XXXXXX'X PINOCCHIO characters, but only such characters
and depictions of such characters, and accompanying design
elements, as may be designated by Disney;
(9) XXXX XXXXXX'X XXXXX IN WONDERLAND characters, but only such
characters and depictions of such characters, and
accompanying design elements, as may be designated by Disney;
76
(10) XXXX XXXXXX'X XXXXX PAN characters, but only such characters
and depictions of such characters, and accompanying design
elements, as may be designated by Disney.
5. Trademarks:
XXXX XXXXXX'X BAMBI
XXXX XXXXXX'X SLEEPING BEAUTY
XXXX XXXXXX'X SNOW WHITE AND THE SEVEN DWARFS
XXXX XXXXXX'X THE JUNGLE BOOK
XXXX XXXXXX'X CINDERELLA
XXXX XXXXXX'X DUMBO
XXXX XXXXXX'X LADY AND THE TRAMP
XXXX XXXXXX'X PINOCCHIO
XXXX XXXXXX'X XXXXX IN WONDERLAND
XXXX XXXXXX'X XXXXX PAN
6. Anticipated release date of Property: Not applicable.
7. Marketing Date: [*]235
8. (Royalty) Advance payment(s) and due date(s):
[*]236
9. (Royalty) Guarantee increments during the term of this Schedule:
[*]237
10. Royalty rate:
[*]238
11. Articles:
A. Infant Bedding
[*]239
-------------------------------------
(235) Confidential portions omitted and filed separately with the Commission.
(236) Confidential portions omitted and filed separately with the Commission.
(237) Confidential portions omitted and filed separately with the Commission.
(238) Confidential portions omitted and filed separately with the Commission.
(239) Confidential portions omitted and filed separately with the Commission.
77
B. Infant Accessories
[*]240
C. Infant Blankets/Throws
[*]241
D. Juvenile
[*]242
12. Distribution:
Licensee will sell the Articles only to Retailers in the Territory for
resale to the public in the Territory; [*]243
13. Special provisions:
[*]244
b. Statements and Payments of Royalties:
In addition to the information requested pursuant to
Paragraph 20 of the Agreement, Licensee shall report all
information required under the Agreement separately by
individual Character Classic Property.
When signed by both parties, this shall constitute a binding Schedule subject
to the terms of the Agreement.
DISNEY ENTERPRISES, INC. CROWN CRAFTS, INC.
By: /s/ Xxxxx Xxxxxxx By: /s/ E. Xxxxxxx Xxxxxxxx
-------------------------------- ----------------------------------
Title: Vice President Licensing Title: Vice President
----------------------------- -------------------------------
Date: April 24, 1998
------------------------------
--------------------------------
(240) Confidential portions omitted and filed separately with the Commission.
(241) Confidential portions omitted and filed separately with the Commission.
(242) Confidential portions omitted and filed separately with the Commission.
(243) Confidential portions omitted and filed separately with the Commission.
(244) Confidential portions omitted and filed separately with the Commission.
