*CONFIDENTIAL TREATMENT REQUESTED*
TRADEMARK LICENSE AGREEMENT
AGREEMENT made this 9th day of April, 1997 between The Pillsbury Company, a
Delaware corporation located in Minneapolis, Minnesota ("Pillsbury" or
"Licensor") and American Crystal Sugar Company, a Minnesota corporation located
in Moorhead, Minnesota ("Licensee").
RECITALS
X. Xxxxxxxxx is the owner of many well known trademarks which, as a
consequence of the consumer acceptance and quality of the products on which such
trademarks are used, as well as substantial sales and advertising over many
years, have come to symbolize goodwill of significant value belonging
exclusively to Pillsbury. Pillsbury desires to provide to Licensee a license,
on terms satisfactory to Pillsbury, to use the PILLSBURY trademark (the "Xxxx")
in the United States to identify sugar to be sold by Licensee.
B. Licensee manufactures and sells various types of sugar in retail
grocery stores and similar outlets and desires the right to use the xxxx to
identify various types of sugar, and Pillsbury is willing to grant permission to
do so on the terms and conditions hereinafter provided.
In consideration of the premises and the mutual promises herein contained,
the parties agree as follows:
1. DEFINITIONS
a. The "Term" of this Agreement is the period from the date set forth
above (the "Effective Date") to *CONFIDENTIAL TREATMENT REQUESTED*.
b. The "Xxxx" means the PILLSBURY trademark, together with the associated
logos, trade dress and package appearance.
c. The "Licensed Products" or "Products" mean Dark Xxxxx Sugar, Light
Xxxxx Sugar, Powdered Sugar, Granulated Sugar, Superfine Sugar, and Cube Sugar.
d. The "Territory" means the United States and its territories and
possessions, and military installations.
e. The "First License Year" shall mean the period beginning on the
Effective Date until September 30, 1997. Thereafter, each License Year shall
commence on October 1st and end on the following September 30th.
f. "Associated Materials" means the labeling, packaging, advertising and
promotional materials, including retail store signage and displays and other
point of sale material, advertising and
promotional copy and strategy, television commercials and all other material
intended to be distributed to the trade or public on which the Xxxx is used
or is intended to be used.
g. "Gross Revenue Delivered" means the gross sales of Products without
deductions for slotting fees, promotional/price allowances or other selling
expenses or freight.
2. LICENSE GRANT
a. Subject to the terms and conditions herein, Pillsbury hereby grants to
Licensee an exclusive license in the Territory to use the Xxxx on and in
connection with the Licensed Products as defined above.
b. Licensee shall have no right to the Xxxx or to make, use or sell any
goods utilizing the Xxxx, or otherwise to deal in or with the Xxxx, other than
as may be expressly granted in this Paragraph 2. Licensee shall have no right
to make, use or sell any goods utilizing any reproduction, counterfeit, copy or
colorable imitation of the Xxxx, or otherwise deal in or with such Xxxx.
c. Nothing in this Agreement shall be construed to prevent Pillsbury from
granting any other license or right to make, use or sell goods bearing the Xxxx,
or from utilizing the Xxxx in any manner whatsoever, other than on goods
constituting the Licensed Products sold in the Territory.
3. QUALITY STANDARDS
a. Licensee acknowledges Pillsbury's right to approve the quality, style
and appearance of the Licensed Products and Associated Materials and any other
materials used in connection therewith.
b. Licensee agrees to manufacture the Licensed Products at
Licensee-owned manufacturing facilities, or any other facility approved in
advance by Pillsbury, which approval shall not be unreasonably withheld or
delayed. Pillsbury shall be permitted to audit the manufacturing of the
Licensed Products at such facilities. If, with Pillsbury's prior written
approval, Licensee subcontracts the manufacture of the Licensed Products,
Licensee shall ensure that such subcontractor both complies and is
contractually obligated to comply with the provisions of Paragraph 3(e)
below, provided, however, Licensee shall remain fully and primarily liable to
Pillsbury under this Agreement for the performance of any such subcontractors.
c. Upon execution hereof, Licensee shall submit to Pillsbury for
Pillsbury's modification (if deemed necessary by Pillsbury) and approval, a
Product Manual containing good manufacturing practices; plant quality control
procedures; consumer and manufacturing complaint procedures; product recall
and withdrawal procedures; audit and inspection procedures; and finished
product ingredient specifications and shelf life for the Licensed Products.
With respect to the Licensed Products, Licensee shall adhere to the
practices, procedures, specifications and quality programs
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contained in the Product Manual as approved by Pillsbury. Upon approval by
Pillsbury, the Product Manual shall be deemed incorporated in its entirety
into this Agreement.
d. Licensee shall comply with the methods of testing raw materials,
ingredients and packaging materials, and finished Licensed Products in
accordance with state and federal standards and in accordance with the Product
Manual. No material alterations, modifications or other changes to the Licensed
Products or Product Manual shall be made after their initial approval without
further written approval of Pillsbury. Licensee shall maintain its
manufacturing facilities and equipment in a clean and sanitary manner and in
good working order. License shall conduct, at its own expense, certain tests of
the Licensed Products pursuant to the quality standards set forth in the Product
Manual and which test results shall, at Pillsbury's request, be delivered by
Licensee to Pillsbury; provided, however, Licensee shall immediately advise
Pillsbury of results that indicate material noncompliance with the Product
Manual and upon instruction of Pillsbury immediately correct such defects.
e. Licensee acknowledges and agrees that Pillsbury, or a mutually
acceptable third party, may inspect, or cause to be inspected, on reasonable
notice, and subject to the Confidentiality Agreement between the parties
executed on December 12, 1996, the following: manufacturing, warehouse and
distribution facilities, ingredients and raw materials, and finished and in-
process Licensed Products, and Pillsbury may audit or cause to be audited
Licensee's quality control and sanitation programs. After each inspection and
audit, Pillsbury will submit reports to Licensee, instructing corrective action
if the facility, program or condition does not meet the requirements set forth
in Title 21 of the Code of Federal Regulations and Chapters 3 and 4 of the
Federal Food Drug and Cosmetic Act, as amended, or does not comply with the
Product Manual. Licensee agrees to implement the necessary corrective action
within a reasonable time; provided, however, Licensee shall immediately suspend
utilizing a manufacturing and/or warehouse facility, when in Pillsbury's
reasonable judgment, a defect or condition is found that causes or may cause a
material health or safety risk. Licensee shall, for as long as the health or
safety risk is present, refrain from utilizing the affected facility to make the
Products. If Licensee continues to utilize the affected facility to manufacture
the Products, Pillsbury shall have the right to immediately terminate or suspend
this Agreement. Should this Agreement be so terminated or suspended, Licensee
shall have no cause of action against Pillsbury in connection with such
termination or suspension, including but not limited to, any claim for damages
or compensation for losses or expenses incurred, or for lost profits. Licensee
agrees to incorporate provisions consistent herewith into any agreement with any
third parties whom Licensee may employ to manufacture, distribute or store any
Products or components of Products.
x. Xxxxxxxxx has the unqualified right to withdraw its approval of any
Products in the event that their quality ceases to materially conform with the
specifications set forth in the Product Manual. Pillsbury has the unqualified
right to withdraw its approval of any Associated Materials in the event that
their quality ceases to materially conform with Pillsbury's standards for
quality and for intellectual property protection.
3
g. From time to time during the Term, Pillsbury may make any changes to
the Product Manual or the standards of quality for Associated Materials.
Licensee shall adhere to the so changed Product Manual and standards of quality
for Associated Materials unless such changes render the manufacture or the
affected Products impossible or commercially nonfeasible as measured by
comparable branded products of Licensee.
h. From time to time, at Pillsbury's request, Licensee shall submit to
Pillsbury, a reasonable quantity of representative Products and Associated
Materials.
i. Licensee will submit to Pillsbury, for prior and prompt approval,
samples of the Products prior to the first shipment date of the Products.
Pillsbury shall make best efforts to approve or reject the Products within ten
(10) business days of receipt of the samples from Licensee. Pillsbury shall
advise Licensee of the reason for the rejection of any Products. Licensee shall
make changes to the rejected Products to the reasonable satisfaction of
Pillsbury prior to their sale or distribution.
4. PURE FOOD GUARANTEE, COMPLIANCE WITH LAWS AND INDEMNIFICATION
a. Licensee guarantees that the Products produced by it shall not be
adulterated or misbranded within the meaning of the Federal Food, Drug and
Cosmetic Act, as from time to time amended, and regulations promulgated
thereunder, and are not articles which, under the provisions of Sections 404 and
505 of such federal act may not be introduced into interstate commerce and are
not in violation of the provisions of the Food Additives Amendment of 1958.
This guarantee is in like terms extended and shall be applicable to any lawful
state law or municipal ordinance in which the definitions of adulteration or
misbranding are substantially the same as those in such federal act.
b. Licensee warrants that the Products shall be manufactured, sold and
distributed in accordance with all applicable federal, state and local laws,
rules, regulations, and guidelines. The policy of sale, distribution and
exploitation of the Products by Licensee shall be of a high standard and shall
in no manner reflect adversely upon the good name of Pillsbury or any of its
programs, products, properties, or the Xxxx.
5. MARKETING AND ADVERTISING
a. Licensee shall introduce the Products supported by an introductory
marketing program mutually acceptable to Pillsbury and Licensee.
b. Licensee shall submit to Pillsbury, for prior approval, all Associated
Materials. Pillsbury shall make best efforts to indicate required changes and
the reason therefor as soon as reasonably practicable, but in no event longer
than ten (10) business days of receipt of Associated Materials from Licensee.
Licensee shall amend or cause to be amended to the satisfaction of Pillsbury any
Associated Materials.
4
c. Licensee shall advise Pillsbury with respect to the compliance of
Associated Materials with all federal, state and local labeling laws,
regulations, and guidelines known to Licensee. In the event any Associated
Materials fail to comply with any applicable labeling law, regulations or
guideline, Licensee undertakes to hold Pillsbury harmless from any and all
damages they may suffer as a result of failure to comply with such laws,
regulations, and guidelines.
d. The parties agree that the Products will be branded as PILLSBURY
products. Licensee shall also utilize on all Product packaging a marking legend
that read: PILLSBURY is a [registered, when and if applicable] trademark of The
Pillsbury Company. Used under license.
e. Licensee shall forward quarterly summaries of all consumer complaints
about the Products to Pillsbury; provided, however, Licensee immediately shall
forward to Pillsbury all consumer complaints about the Products, which
complaints may materially affect the reputation or business of Pillsbury.
Pillsbury and Licensee shall confer as to how to respond to such complaints.
Pillsbury and Licensee shall each have the right to respond to all consumer
complaints or inquiries concerning the Licensed Products.
6. GOODWILL
Licensee recognizes the significant value of the goodwill associated with
the Xxxx and acknowledges that the Xxxx and all rights therein and goodwill
pertaining thereto belong exclusively to Pillsbury, and that the Xxxx has and
will continue to have a secondary meaning in the mind of the public to signify
Pillsbury. Accordingly, License shall not do or permit to be done any act or
thing or permit any Products to enter the stream of commerce or to be sold or
distributed, that could reasonably be anticipated to impair the goodwill or
other rights of Pillsbury and the Xxxx or that could reasonably be anticipated
to otherwise prejudice, tarnish or damage the reputation of the Xxxx, Pillsbury,
or the sale of Pillsbury's products.
7. PILLSBURY'S TITLE AND PROTECTION
a. Licensee acknowledges Pillsbury's title to the Xxxx and agrees that it
shall not at any time do or cause to be done any act or thing or undertake any
action any where that in any manner might infringe, or impair the validity,
scope, or title of Pillsbury in the Xxxx. It is understood that Licensee or any
affiliate of Licensee shall not acquire and shall not claim any title to the
Xxxx adverse to Pillsbury by virtue of this Agreement the parties intending all
utilization of the Xxxx by Licensee shall at all times inure to the exclusive
benefit of Pillsbury.
b. Licensee agrees that, without the further written authorization of
Pillsbury, it will not use the name of Pillsbury or any reproduction,
counterfeit, copy or colorable imitation thereof, as a trading designation or in
any other way, except to indicate, pursuant to Paragraph 5(d) herein above, that
Licensee is authorized by Pillsbury to use the Xxxx in respect of the Products.
5
c. Licensee shall notify Pillsbury in writing of any infringement and any
reproduction, counterfeit copy or colorable imitation by others of the Xxxx that
may come to Licensee's attention, and Pillsbury shall have the sole and
exclusive right to determine whether or not any action shall be taken on account
of any such infringement, reproduction, counterfeit copy or imitation.
Pillsbury shall control any and all infringement and unfair competition actions
and it shall have the sole and exclusive right to commence or prosecute any
claims or suits with respect to the Xxxx in its own name or jointly in the name
of Pillsbury and Licensee at Pillsbury's expense.
x. Xxxxxxxxx and Licensee shall cooperate in the defense of any third
party claim based upon infringement of a third party's trademark rights to the
extent such claim asserts that performance under this Agreement violates that
third party's rights. Pillsbury and Licensee shall cooperate in the prosecution
of any claim based upon infringement of the trademark rights of Pillsbury or
Licensee.
8. INDEMNIFICATION
a. Except as otherwise provided in Paragraph 8(c) below, Licensee
hereby agrees to indemnify and hold harmless and release and forever
discharge Pillsbury and each of its agents, officers, directors, and
employees from any and all claims, demands, damages, judgments, costs and
expenses, including reasonable attorneys' fees, that may be claimed, asserted
or rendered against Pillsbury, or any or all of the above mentioned persons
or their successors, arising from: (i) any actual or alleged injury, damage,
death or other occurrence to any person or property arising or resulting
directly or indirectly out of the distribution and sale, or the possession,
use or consumption of the Products manufactured, sold or supplied by Licensee
at any time; (ii) any actual or alleged patent, copyright, false advertising
or, subject to Paragraph 8(c) below, trademark infringement or unfair
competition, arising from the formulation, manufacture, packaging,
distribution, promotion, exploitation or sale of the Products, or (iii) the
failure of Licensee to fulfill any of its obligations under this Agreement.
Any consents, approvals, inspections, reviews or similar actions undertaken
or not undertaken by Pillsbury pursuant to Paragraphs 2, 3 or 5 shall not
waive, reduce or otherwise affect or diminish any rights of Pillsbury to
indemnification under this Agreement. For purposes of Paragraph 8,
"Pillsbury" shall mean The Pillsbury Company and its subsidiaries and
affiliated companies, and each of their respective agents, officers,
directors, and employees.
b. Except as may be provided in Paragraph 8(c) below, Pillsbury and
each of their agents, officers, directors, and employees will not be
responsible, in any way, to any party whatsoever, with respect to any
warranties, negligence, defects, or other obligations, however any of the
foregoing might arise, with respect to the formulation, manufacture,
packaging, distribution, promotion, exploitation, or sale of the Products.
x. Xxxxxxxxx agrees to indemnify and hold harmless Licensee and its
officers, directors, and employees from any and all claims, demands, damages,
costs and expenses, including reasonable attorneys' fees, that may be claimed
or asserted against Licensee, or any or all of the above-mentioned persons or
their successors, on account of any actual or alleged trademark infringement
6
arising out of the use of the Xxxx by Licensee pursuant to this Agreement.
Pillsbury reserves the right to defend itself against any such trademark
infringement suit and Licensee shall assist Pillsbury in the defense of any
such suit as Pillsbury may reasonably request.
d. In the event of any claim, action or proceeding for which a person is
entitled to indemnity hereunder, the person seeking indemnity (the "Claimant")
shall promptly notify the other party (the "Indemnitor") of such matter in
writing. The Indemnitor shall then promptly assume primary responsibility for
and shall have primary control of such matter, including settlement negotiations
and the institution and defense of any legal proceedings, provided the Claimant
shall retain the right to be represented, at its expense, by separate counsel.
Subject o the foregoing, the Claimant shall otherwise fully cooperate in the
Indemnitor's handling and defense of any such claims, action or proceeding.
e. In the event of a challenge or protest by the Federal Trade
Commission, the Food and Drug Administration, any state attorney general or any
other regulatory body alleging false or misleading advertising and/or labeling
provisions and/or adulterated or misbranded product, the Indemnified Party shall
(to the extent permitted by law or such governmental agency) have the right to
participate in any settlement proceedings related thereto and to be consulted by
the Indemnifying Party regarding such settlement, and the Indemnifying Party
shall not, without the prior consent of the Indemnified Party: (i) settle or
compromise any such challenge or protest or (ii) release to the public any
settlement or other statement of the terms under which such challenge or protest
has been settled or compromised.
9. INSURANCE
a. Licensee shall obtain, and at its own cost and expense,
*CONFIDENTIAL TREATMENT REQUESTED* umbrella comprehensive general liability
insurance, including product liability coverage, and *CONFIDENTIAL TREATMENT
REQUESTED* advertiser's liability coverage, protecting Pillsbury against any
claim or suits arising in any fashion from the consumption, manufacture,
distribution, advertising, promotion or sale of the Products. Licensee shall
submit to Pillsbury certificates of insurance with a thirty (30) day prior
written notice of cancellation provision, with The Pillsbury Company and its
subsidiaries and affiliated companies, and each of their respective agents,
officers, directors and employees named as additional insured parties, as
evidence of such insurance coverage. Within ten (10) days following
execution of this Agreement, Licensee shall submit to Pillsbury a binder as
evidence of insurance coverage set forth above with certificates of insurance
subsequently submitted to Pillsbury within thirty (30) days following
execution of this Agreement. Licensee shall keep policies in force during
the term of this Agreement and for at least one year thereafter, and, upon
request by Pillsbury, submit to Pillsbury evidence of renewal prior to the
expiration of the original terms of insurance and each renewal term
thereafter.
b. It is understood and agreed that if Licensee fails to obtain or
maintain such comprehensive general liability insurance and advertiser's
liability coverage, pursuant to the requirements of Paragraph 9(a) above,
Pillsbury may immediately terminate this Agreement forthwith
7
by serving notice of such termination on Licensee; provided, however,
Licensee may avoid termination by complying with Paragraph 9(a) above within
thirty (30) days after being given notice of termination. Should this
Agreement be so terminated, Licensee shall have no cause of action against
Pillsbury in connection with such termination including but not limited to
any claim for damages or compensation for losses or expenses incurred, or for
lost profits.
10. PAYMENTS AND EARNED ROYALTIES
a. Earned Royalties. In consideration of the license granted by
Pillsbury to Licensee pursuant to this Agreement, Licensee agrees to pay
Pillsbury a royalty of *CONFIDENTIAL TREATMENT REQUESTED* of Gross Revenue
Delivered.
b. Royalties shall be paid within forty-five (45) days after the close of
each quarter of the License Year or other license period, and at the end of the
License Year or other license period, during the Term and any renewal period of
this Agreement and shall be accompanied by an earned royalty statement.
Licensee shall submit the earned royalty statement to Pillsbury within thirty
(30) days after the end of each calendar quarter during the Term of this
Agreement whether or not royalties are due in that particular quarter. In case
of delay in payment by Licensee to Pillsbury, interest at the rate of eight
percent (8%) per annum, assessed as from the first day following the close of
such License Year quarter, shall be due Pillsbury without special notice.
c. Licensee shall make payment of all monies due Pillsbury under this
Agreement to Pillsbury until such time as Pillsbury shall notify Licensee
otherwise.
11. REPORTS AND RECORDS
a. Licensee shall keep at its principal place of business accurate and
complete records of all matters pertaining to its obligations under this
Agreement. Pillsbury, or its authorized representative, shall have the right to
audit such records pertaining to the computation of royalties pursuant to
Paragraph 10 herein above.
b. Licensee shall maintain records to verify accuracy of the computation
of royalty payments for a period of two (2) years after such payments.
Pillsbury, or its authorized representative, shall have the right to audit such
records for the period of two years after such payments. This Paragraph 11(b)
shall survive the termination of this Agreement.
c. Licensee shall pay Pillsbury's audit costs under this Paragraph in the
event the audit discloses a discrepancy between royalties due Pillsbury and
royalties actually paid to Pillsbury of greater than five percent (5%).
8
12. TERM AND TERMINATION
a. This Agreement shall be effective as of the Effective Date and shall
continue for the Term, unless sooner terminated or extended as set forth herein
below.
b. (i) Subject to subparagraph 12(b)(ii), this Agreement may be renewed
only upon mutual written agreement of the parties. If either party desires
to explore a possible renewal of this Agreement, such party shall notify
the other party of its intention no later than ninety (90) days prior to
the date of expiration of this Agreement. Notwithstanding the foregoing
sentence, nothing contained herein shall obligate either party to renew
this Agreement; provided, however, that if Pillsbury shall at any time
refuse to renew this Agreement without cause, Pillsbury agrees that it will
not, directly or through any third party, sell Licensed Products in the
Territory under the Xxxx for a period of one (1) year from the termination
or expiration of this Agreement. For purposes of this provision, "cause"
shall mean any default of Licensee under subparagraphs 12(c), 3(e), 9(b) of
this Agreement, which default has not been cured in accordance with the
terms of this Agreement.
(ii) This Agreement may be renewed by Licensee for *CONFIDENTIAL
TREATMENT REQUESTED* additional periods of *CONFIDENTIAL TREATMENT
REQUESTED* years each, upon written notice to Pillsbury of its intention to
renew no later than ninety (90) days prior to the date of expiration of
this Agreement or the then current renewal term, provided however, that the
written notification must contain mutually acceptable documentation that
the gross revenue for the year ending in 90 days or more will exceed
*CONFIDENTIAL TREATMENT REQUESTED*. If the projected gross revenue is
*CONFIDENTIAL TREATMENT REQUESTED* or less, the parties may agree to renew
this Agreement, or either party may notify the other that it does not
intend to renew this Agreement specifically because this standard has not
been achieved. It is agreed that nonrenewal of the Agreement under this
provision shall not constitute "cause" for nonrenewal (as described in
subparagraph b(i) above).
c. If any of the following defaults shall have happened:
(i) If Licensee fails to make any required payment for a period
beyond thirty (30) days from the date such payment was due, or fails to pay
with interest any amount due within three (3) business days after notice of
default; or
(ii) If Licensee fails to obtain or maintain insurance coverage,
pursuant to the requirements of Paragraph 9, and such default is not
remedied within thirty (30) days after being given written notice; or
(iii) In the event of an actual or attempted assignment or
sublicense hereof by Licensee, or in the event Licensee delegates its
duties hereunder or subcontracts a substantial
9
portion of the manufacture of any Product without Pillsbury's prior
written consent in each instance; or
(iv) If Licensee fails to have affixed on any Product any notice
required by Pillsbury or as required by applicable law, regulation, or
guideline, or utilizes Associated Materials previously rejected by
Pillsbury, and such default is not cured within thirty (30) days after
being given written notice, or, if such default is of such a nature as
cannot be remedied within thirty (30) days, if Licensee has not in good
faith taken reasonable and appropriate measures to remedy such default
within thirty (30) days after being given written notice; or
(v) If food pathogens are found in the Product or use or exposure of
the Product poses a reasonable probability of causing adverse health
consequences; or
(vi) If the Product is adulterated other than within the meaning
subparagraph 12(c)(v) above, and such default is not cured within thirty
(30) days after being given written notice; or
(viii) If Licensee has substituted, altered or omitted any
ingredient, component, process or procedure called for by the Product
Manual for a Product, or Licensee has materially altered the taste,
texture, nature or in other respects the quality of a Product without
Pillsbury's prior written consent given pursuant to Paragraph 3 above, and
such default is not remedied within thirty (30) days after being given
written notice; or
(viii) If Licensee defaults in the performance of any of the other
terms, conditions or provisions of this Agreement in such a manner as to
materially affect the rights of Pillsbury hereunder or the validity or
enforceability of a Xxxx, and such default is not remedied within thirty
(30) days after being given written notice, or, if such default is of such
a nature as cannot be remedied within thirty (30) days, if Licensee has not
in good faith taken reasonable and appropriate measures to remedy such
default within thirty (30) days after being given written notice; or
(ix) If Pillsbury defaults in the performance of any of the terms,
conditions, or provisions in this Agreement, and such default is not
remedied within thirty (30) days after being given written notice, or, if
such default is of such a nature as cannot be remedied within thirty (30)
days, if Pillsbury has not in good faith taken reasonable and appropriate
measures to remedy such default within thirty (30) days after written
notice; or
(x) If the parties cannot agree on an introductory marketing program
pursuant to paragraph 5(a);
then the non-defaulting may, if it so elects, terminate this Agreement forthwith
by serving written notice of such termination to the defaulting party. Upon
such termination, or upon termination pursuant to Paragraph 3(e) or 9(b):
10
(1) All accrued earned royalties that are then unpaid, if any, shall
immediately become due and payable and shall be paid by Licensee
to Pillsbury; and
(2) All rights granted to Licensee hereunder shall forthwith revert
to Pillsbury, and Licensee shall immediately refrain from further
use of the Xxxx and any reference thereto, direct or indirect.
d. If Licensee files a petition of bankruptcy or an order for relief
under the Bankruptcy Code or other insolvency law is entered against Licensee or
if Licensee is adjudicated as bankrupt, or if a petition in bankruptcy is filed
against Licensee, or if it becomes insolvent or makes an assignment for the
benefit of its creditors or an arrangement pursuant to any bankruptcy or
insolvency law, or if Licensee discontinues its business, or suspends active
operations or any substantial part thereof for a period in excess of five (5)
consecutive business days, or if a receiver is appointed for it or its business,
the license hereby granted shall automatically terminate forthwith without any
notice whatsoever being necessary. Should this Agreement be so terminated,
Licensee, its administrators, successors, or assigns shall have no right to
sell, exploit or in any way deal with or in any Products covered by this
Agreement or any written or printed or tangible matter bearing the Xxxx, except
with and under the special consent and instructions in writing of Pillsbury.
e. Termination of the license granted herein under the provisions of this
Paragraph 12 shall be without prejudice to any rights that Pillsbury may
otherwise have against Licensee. The right of termination herein shall not be
exclusive, and the exercise or non-exercise thereof shall not preclude the
exercise by the non-defaulting party of any other right or remedy that it may
have by law against the defaulting party.
f. Upon termination of this Agreement Licensee shall comply with all the
terms set forth in this Agreement covering obligations of Licensee upon
termination.
g. Except as provided in Paragraph 13(b) below, upon the termination of
this Agreement, Licensee shall immediately cease the manufacture, distribution
and sale of the Products and all unpaid amounts due Pillsbury shall become
immediately due and payable.
13. INVENTORY UPON TERMINATION
a. Ten (10) days after a notice of termination is given or the happening
of an event that automatically terminates this Agreement where no notice is
required, Licensee shall furnish to Pillsbury an audited statement certified by
the president or chief financial officer of Licensee to be true and correct
showing the number and description of Products on hand, held for Licensee in
inventory or otherwise, or in process.
b. After termination of this Agreement, except as otherwise provided in
this Agreement and except in the event of termination pursuant to Paragraph 3(c)
or 9(b) or 12(b) or subparagraph (ii), (iii), (v), (vi), (vii) or (viii) of
Paragraph 12(c), Licensee shall have the right to deplete existing
11
inventories of Products bearing the Xxxx for a period not to exceed three (3)
months following the date of expiration or termination; provided, however,
Licensee shall remove Product beyond its shelf life from store shelves and
Licensee shall fully perform all of its obligations required under this
Agreement as if it had not expired or terminated. Thereafter, the remaining
such Products shall be destroyed and a sworn certificate of destruction shall
be furnished by Licensee to Pillsbury in a form acceptable to Pillsbury and
executed by the chief operating officer or chief financial officer of
Licensee. In the event of termination pursuant to Paragraph 3(e) or 9(b) or
subparagraph (ii), (iii), (v), (vi), (vii) of Paragraph 12(c), Pillsbury may,
in its sole discretion, permit Licensee to deplete inventories under
safeguards and conditions Pillsbury shall prescribe.
14. EFFECT OF TERMINATION
a. Upon termination of this Agreement, all rights granted to Licensee
hereunder shall forthwith revert to Pillsbury, and Licensee shall stop all
further use of the Xxxx or any further reference to it, direct or indirect, or
any reproduction, counterfeit, copy or colorable imitation thereof, in
connection with the manufacture, sale or distribution of Licensee's goods or
other items of tangible or intangible property except as provided in Paragraph
13 above.
b. Licensee acknowledges that its manufacture, sale or distribution of
the Products, or any other goods bearing the Xxxx, after termination of this
Agreement, except as provided in Paragraph 13 above, shall result in immediate
and irreparable damage to which there is no remedy in law, to Pillsbury and to
the rights of any subsequent licensee. Licensee acknowledges and admits that
there is no adequate remedy of law for its failure to cease such activities and
that, in such event, Pillsbury shall be entitled to relief by way of such
temporary and permanent injunctive relief as a court may deem just and proper.
c. Licensee shall not be able to claim from Pillsbury any damages or
compensation for losses or expenses incurred or for loss of profits arising in
any fashion from Pillsbury's proper and lawful termination of this Agreement.
d. Termination of this Agreement for any reason shall not affect those
obligations that have theretofore accrued or that, from the context hereof, are
intended to survive termination of this Agreement.
15. FORCE MAJEURE
Neither party shall be considered to be in default in respect to any
obligation under this Agreement, other than the obligation of a party to make
payment of amounts due to other party under or pursuant to this Agreement, if
failure of performance shall be due to force majeure. If either party is
affected by a force majeure event, such party shall, within ten (10) days of its
occurrence, give notice to the other party stating the nature of the event is
anticipated duration and any action being taken to avoid and minimize its
affect. The suspension of performance shall be of no greater scope and no
longer duration than is required and the non-performing party shall use its best
efforts to
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remedy its inability to perform. The obligation to pay money in a timely
manner is absolute and shall not be subject to the force majeure provisions,
other than rules and regulations, incidents to bankruptcy or insolvency
proceedings of a party.
16. LICENSEE'S REPRESENTATIONS
In addition to all of the agreements, promises, guarantees, covenants,
warranties and obligations herein contained, Licensee represents and warrants to
Pillsbury that it is a corporation organized and validly existing under the laws
of the state of its incorporation with full power and authority to execute,
deliver and fully perform the terms and conditions hereof, and that it is under
no restriction or prohibition limiting its ability or right to execute, deliver
and fully perform its obligations hereunder.
17. DISCLAIMER OF WARRANTIES AND REPRESENTATIVES BY PILLSBURY
Pillsbury makes no warranty or representation whatsoever, express or
implied, as to the amount of gross sales, gross revenue delivered, profits or
volume that Licensee will derive from or may expect with respect to the Licensed
Products.
18. NOTICES
Any notice or report sent pursuant to any provision of this Agreement shall
be sent and shall be deemed given four (4) days after being sent by certified
mail, return receipt requested, or will be deemed given when delivered in person
or by facsimile transmission if confirmation copy is received by overnight
courier on the following day, to the following addresses or such other addresses
as shall be hereafter notified:
If to Pillsbury: The Pillsbury Company
000 Xxxxx Xxxxx Xxxxxx X.X. 0000
Xxxxxxxxxxx, XX 00000
Fax: 000-000-0000
Attn: Xxxxx Xxxxx
If to Licensee: American Crystal Sugar Company
000 Xxxxx 0xx Xxxxxx
Xxxxxxxx, XX 00000-0000
Fax: (000) 000-0000
Attn: Xxxxxx XxXxxxx
19. PARAGRAPH ORDER AND HEADINGS
The paragraph order and headings are for convenience only and shall not be
deemed to affect in any way the language, obligations or the provisions to which
they refer.
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20. APPLICABLE LAW
This Agreement shall be construed in accordance with the laws of the State
of Minnesota.
21. NO JOINT VENTURE
Nothing herein contained shall be construed to place the parties in the
relationship of principal and agent, partners or joint venture, and Licensee
shall have no power to obligate or bind Pillsbury in any manner whatsoever.
22. ASSIGNMENT OR SUBLICENSE
This Agreement and all benefits, rights and duties hereunder are personal
to Licensee and shall not, without the prior written consent of Pillsbury in
each instance, be assigned, delegated, made subject to a security interest,
sublicensed, or otherwise encumbered by Licensee or by operation of law.
Pillsbury may assign this Agreement and the benefits hereof, upon written notice
to Licensee. For purposes of this Agreement, the term "assign" shall be deemed
to include all transfers of control, whether accomplished by means of a transfer
of stock, voting trust, or otherwise to any person or entity not in control
immediately prior to such transfer, or transfers effected by corporate merger,
consolidation, reorganization or other means.
23. WAIVER
The failure of any party hereto to enforce any provision of this Agreement,
or any right with respect thereto, or failure to exercise any election provided
for herein, shall in no way be considered a waiver of such provision, right, or
election, or in any way affect the validity of this Agreement. The failure of
any party hereto to enforce any provision, right or election shall not prejudice
such party from later enforcing or exercising that provision, right, or election
which it has under this Agreement.
24. SEVERABILITY
In the event that any provision of this Agreement or any part thereof is
held by a court to be invalid, the remainder of this Agreement shall be binding
on the parties and construed as if the invalid provisions or parts thereof have
been deleted from this Agreement.
25. ENTIRE AGREEMENT
This Agreement and the Exhibits (which are hereby incorporated and made a
part hereof) sets forth the entire understanding of the parties in respect of
the subject matter hereof, and it may be amended or modified only in writing
executed by each party hereto.
26. CONFIDENTIALITY
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Each party to this Agreement shall maintain the terms of this Agreement in
confidence and shall not disclose the terms to any person except only to the
extent necessary to that party's employees as shall be required to implement the
Agreement. Neither party shall issue a public statement concerning or
announcing this agreement without the written consent of the other party.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
THE PILLSBURY COMPANY
Date: By: /s/ Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Vice President
4/10/97
AMERICAN CRYSTAL SUGAR COMPANY
Date: By: /s/ Xxxxxx X. XxXxxxx
Name: Xxxxxx X. XxXxxxx
Title: CEO
United Sugars Corporation, a Minnesota cooperative association located in
Bloomington, Minnesota, agrees to comply with and be bound by the terms of this
Agreement in connection with its distribution of Licensed Products.
UNITED SUGARS CORPORATION
Date: By: /s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx
Title: President
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