TRADEMARK LICENSE AND ASSIGNMENT AGREEMENT
THIS TRADEMARK LICENSE AND ASSIGNMENT
AGREEMENT (the “Agreement”) is made and entered into this 17th day of
September, 2010, but effective as of July 29, 2010 (the “Effective Date”) by and
between Preferred Apartment Communities, Inc. (“Licensor” or “Assignor”) and
Preferred Apartment Advisors, LLC, (“Licensee” or Assignee”).
In
consideration of the premises and the mutual covenants and agreements contained
herein, and other valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties hereto agree as follows:
1. Background.
(a) The
parties acknowledge that they are affiliated and related companies that are
entering into this Agreement to memorialize an arrangement and agreement between
them that was in existence as of the Effective Date, governing the chain of
title, ownership and licensing of the service marks, trade names and
logos, and any corresponding applications set forth in
Exhibit A,
which are annexed hereto and incorporated herein, and any other rights
pertaining thereto (collectively, the “Marks”).
(b) As
provided herein, the Licensee will license the use of the Marks from Licensor in
connection with Licensee’s business and services. As soon as is reasonably
practicable thereafter, Licensor will convert its pending intent-to-use
trademark applications for the Marks set forth in Exhibit A
(collectively, the “Applications”) to use based applications, following which
Licensor will assign its ownership of the Marks and Applications to Licensee,
who will become the new owner of the Marks and Applications.
(c) The
parties acknowledge and agree that under the circumstances the assignments
resulting under this Agreement do not constitute an assignment in gross or a
present assignment of intent-to-use trademark applications and the parties and
their successors waive the right to object to this Agreement and the underlying
transfer and licensing of the rights in the Marks and Applications.
2. License. Licensor
hereby grants to Licensee an exclusive, worldwide, fully-paid, royalty-free,
assignable and sublicensable license to use the Marks in connection with
the services related to Licensee’s business, including but not
limited to those set forth in Exhibit A (the
“License”).
3. Assignment and
Ownership of the Marks. Upon Licensor’s completed and
successful conversion of the Applications to use based application (either by
filing amendments to allege use and/or Statements of Use with the USPTO)
Licensor will unconditionally and irrevocably assign and convey to Licensee, all
of Licensor’s right, title and interest in and to the Marks (including common
law rights), together with the good will associated with the Marks and the
business conducted under the Marks, including but not limited to the right to
xxx for past infringement by third parties, and the right to register and use
the Marks without limitation. Licensee may thereafter sell, assign, license,
sublicense or otherwise transfer or register any or all rights granted to it in
the Marks. Upon Licensor’s transfer of ownership of the Marks to Licensee, the
License shall automatically terminate.
4. Consideration. Additional
consideration for the transactions contemplated under this Agreement, if any,
shall be set forth in Exhibit
B.
5. Term. This
Agreement and the License granted hereunder shall commence on the Effective Date
and shall continue until terminated in accordance with the provisions of this
Agreement.
6. Ownership and
Restrictions.
(a) While
the License is still in effect, Licensee agrees to use the Marks only in the
form and manner and with appropriate proprietary legends as prescribed from time
to time by Licensor, and will not use any other trademark or service xxxx in
combination with the Marks without the prior consent of Licensor.
(b) Licensee
hereby acknowledges Licensor’s right, title and interest in and to the Marks and
Licensor’s exclusive right to use, register and license the use of the Marks and
agrees that until ownership of the Marks is transferred to Licensee, not to
claim or assert any (i) title to nor attempt to register the Marks anywhere
in world or (ii) right to use the Marks, except to the extent expressly
permitted by this Agreement.
(c) Licensee
shall not, until after ownership of the Marks is transferred to Licensee,
attempt to adopt, use or register without Licensor’s prior consent, any
variation of the Marks, including translations, or any xxxx which is similar to
or likely to be confusing with the Marks. If Licensor consents to the use of
such a xxxx, this Agreement will be deemed to be amended to include such xxxx as
part of the definition of the Marks, which shall then be subject to all of the
terms of this Agreement.
(d) Licensee
shall not, until ownership of the Marks is transferred to Licensee, contest or
deny the validity or enforceability of the Marks or Licensor’s interest or
rights in the Marks, nor oppose, object to, or seek to cancel any registration
thereof by Licensor, nor aid or abet others in doing so.
(e) Until
ownership of the Marks is transferred to Licensee (i) any and all goodwill
arising from Licensee’s use or sublicensing of the Marks shall inure solely to
the benefit of Licensor; and (ii) Licensee shall not, nor permit any one else,
to take any action that could be detrimental to the good will associated with
the Xxxx.
(f) The
parties shall, during the term of this Agreement and after termination hereof,
execute such documents, or perform such other and further acts, as the other may
reasonably request from time to time to ensure that all right, title and
interest in and to the Marks reside with the appropriate party or to otherwise
transfer, assign, perfect, record, confirm, defend or enforce the other party’s
rights in and to the Marks in accordance with this Agreement.
7. Infringement or
Other Claims Against Third Parties. While the License is still
in effect, Licensee shall notify Licensor promptly of any unauthorized use of
the Marks by others (or marks which may be confusingly similar to the Marks) of
which Licensee becomes aware. Licensor shall thereafter, at any time
prior to Licensee becoming the owner of the Marks, have the sole right, at
Licensee’s expense, to make any demand or bring any action on account of any
such unauthorized use, whether such claims are grounded in trademark
infringement, dilution, unfair competition, false designation of origin or other
legal theory; Licensee will subsequently have such rights after Licensee assumes
ownership of the Marks. Licensee shall cooperate fully with Licensor, as
Licensor may reasonably request, in connection with any such action or demand
brought by Licensor in accordance with this Agreement. Licensor shall directly
pay all costs and expenses associated with such action or demand and Licensee
shall reimburse Licensor for such costs and expenses as part of the
consideration for the License and assignment. Licensor shall remit to Licensee
any and all damages, settlement and/or compensation paid in connection with any
such action or demand brought by Licensor. For the avoidance of doubt, following
the transfer of ownership in the Marks to Licensee, Licensee shall have sole and
unlimited discretion to decide whether or not to pursue infringement or other
claims against third parties in connection with the Marks, and shall assume all
costs and retain all damages, recoveries or settlement proceeds associated with
same.
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8. Quality
Control.
(a) General. Licensee
recognizes that the valuable reputation and goodwill that is or will be
attaching to the Marks is dependent for its preservation on the high quality
standards prescribed and established by Licensor. Accordingly, Licensee is
willing to comply with Licensor’s standards in order to maintain such quality
and to cooperate with Licensor in preserving the reputation and goodwill
attaching to the Marks while the License is in effect.
(b) Quality of the
Services. Licensee agrees that during the term of the License,
the services provided under the Marks and the Collateral Materials (as
hereinafter defined) created by Licensee and its sublicensees, shall not fall
below the level of quality (i) that is at all times generally customary within
Licensee’s and sublicensees’ applicable industries, for other businesses
similarly situated; and (ii) that is at all times required to remain in
compliance with any applicable laws or regulations.
(c) Monitoring the Quality of
the Services. Given the special relationship between the
Licensor and Licensee as an affiliated group of companies with overlapping
ownership, control and management, each party acknowledges (i) its own interest
in maintaining the quality standards required under this Agreement, (ii) the
unique ability of Licensor to monitor the activities of Licensee, and (iii) that
the failure to maintain the quality standards or otherwise comply with this
Agreement, could under certain circumstances, potentially result in a diminution
or loss of trademark rights, to the detriment of Licensor and Licensee.
Accordingly, the allocation of responsibilities for quality control as provided
herein are inherently reasonable measures which should ensure adherence to
quality standards and prevent any resultant harm to the parties involved as well
as to the general public. Among other measures (i) except as otherwise provided,
Licensee shall have the obligation and responsibility to police its own
compliance with quality standards, (ii) Licensee shall act as Licensor’s agent
for the purposes of monitoring sublicensees’ compliance with quality standards,
and (iii) Licensor reserves the right to directly police the compliance of
Licensee and sublicensees itself.
(d) Quality of the Collateral
Materials. During the term of the License, Licensee shall furnish to
Licensor prior to any use, publication, dissemination, distribution, disclosure
or public display, for the approval of Licensor, copies of all advertising,
marketing, websites and promotional material, in any form or media (including
electronic or digital media) on which the Marks appear (the “Collateral
Materials”). Licensor shall have the right to approve or disapprove any or all
Collateral Materials in accordance with Licensor’s quality standards. Any
Collateral Materials submitted to Licensor shall be deemed approved unless
Licensor notifies Licensee to the contrary within ten (10) days after receipt of
such Collateral Materials. If Licensor does not approve Collateral Materials,
its rejection notice shall set forth the reasons for such rejection, and to the
extent it is reasonable to do so, will also set forth the remedial measures
required to be taken to bring the rejected Collateral Materials into compliance
with Licensor’s quality control standards. Licensee shall not use, publish,
disseminate, distribute, disclose or publicly display any Collateral Materials
unless and until they have been approved by Licensor pursuant to this Section.
All copies of the Collateral Materials that are distributed by Licensee shall be
identical to the Collateral Materials approved by Licensor.
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(e) Records, Audit and
Inspection. Licensee will maintain adequate books, records and back-up
documentation to allow Licensor to verify Licensee’s and sublicensees’
compliance with this Agreement. Such records must be maintained for a period of
at least five (5) years after each such record is created, unless a longer
period of time is required by applicable law or regulation. Upon five (5) days
prior written notice, Licensor shall have the right, not more than four (4)
times per year, by itself or through its designated agents/contractors who are
not reasonably objectionable to Licensee and which may include Licensee, to
conduct an audit and inspection of any or all of Licensee’s or sublicensees’
books, records, documentation, facilities, plants and equipment (including but
not limited to computer hardware, software, servers, and data in any form or
media) as are reasonably necessary to verify compliance with the terms of this
Agreement. All individuals participating in the audit or inspection shall be
under an obligation to maintain the confidentiality of any confidential
information or trade secrets of Licensee or sublicensee that are disclosed in
the course of the audit or inspection. The costs of such audits shall be paid
for by Licensee.
9. Termination.
(a) The
License and this Agreement shall automatically terminate upon transfer of
ownership of the Marks from Licensor to Licensee.
(b) Either
party shall have the right to terminate this Agreement upon the material breach
of this Agreement by the other party, which remains uncured more than thirty
(30) days after receipt of written notice of such breach.
(c) Licensee
shall have the right to terminate this Agreement at any time upon thirty (30)
days prior written notice to Licensor.
(d) The
parties may mutually agree in writing to terminate this Agreement.
(e) The
exercise of any right of termination under this Section shall not affect any
rights which have accrued prior to termination, and shall be without prejudice
to any other legal or equitable remedies to which the terminating party may be
entitled.
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10. Effects of
Termination Prior To The Transfer Of Ownership In The Marks.
(a) If
this Agreement terminates prior to the transfer of ownership in the Marks to
Licensee: (i) all rights of Licensee under the License granted hereunder shall
terminate and automatically revert to Licensor; (ii) Licensee shall
immediately discontinue the use of the Marks and thereafter shall no longer use
or have the right to use the Marks or any variation or simulation thereof;
(iii) Licensee shall destroy all printed materials bearing the Marks and
(iv) Licensor shall have the right to terminate any and all sublicenses or
assume any and all sublicenses and enter into a direct licensing relationship
with sublicensees (if applicable).
(b) Licensee
acknowledges that Licensee’s failure to cease the use of the Marks upon
termination of this Agreement prior to the transfer of ownership in the Marks to
Licensee shall result in immediate and irreparable damage to Licensor and to the
consuming public generally. Licensee acknowledges and admits that
there is no adequate remedy at law for such failure, and agrees that in the
event of such failure, Licensor shall be entitled to equitable relief by way of
temporary and permanent injunction, without being required to post a bond, and
such other and further relief as any court with jurisdiction may deem just and
proper.
11. Indemnification.
(a) Licensee
will, and will cause its sublicensees to agree to, indemnify, defend and hold
harmless Licensor, its subsidiaries and affiliates, and any of their successors,
assigns, employees, officers, directors, agents and contractors from and against
any and all losses, liabilities, damages costs and expenses (including without
limitation reasonable attorneys’ fees) in connection with any claim, demand,
allegation, accusation or action (individually, a “Claim”) based upon, resulting
from or related to Licensee’s or sublicensee’s: (i) goods or services provided
under or in connection with the Marks; (ii) allegedly intentional or negligent
act, omission or misrepresentation; or (iii) alleged breach of any warranties,
representations or obligations under this Agreement or sublicense.
(b) Licensee will
indemnify, defend and hold harmless Licensor and its subsidiaries and
affiliates, and any of their successors, assigns, employees, officers,
directors, agents and contractors from and against any and all losses,
liabilities, damages costs and expenses (including without limitation reasonable
attorneys’ fees) in connection with any Claim brought by third parties alleging
that Licensee’s or sublicensee’s use of the Marks as permitted under this
Agreement infringe the trademark or service xxxx of such third party. If any of
the permitted uses of the Marks become, or in Licensor’s opinion are likely to
become, the subject of a Claim, during the term of the License, Licensor may, at
its option: (i) procure for Licensee and/or sublicensees the right to continue
using the Xxxx as permitted under this Agreement; (ii) litigate with the party
alleging infringement; or (iii) terminate this Agreement. THIS SECTION STATES
THE SOLE AND EXCLUSIVE REMEDY OF LICENSEE AND SUBLICENSEES, AND THE ENTIRE
LIABILITY OF LICENSOR, ANY PARENT, SUBSIDIARY, OR AFFILIATE OF LICENSOR, OR ANY
OF THEIR OFFICERS, DIRECTORS, EMPLOYEES, SHAREHOLDERS, CONTRACTORS OR
REPRESENTATIVES IN CONNECTION WITH ANY SUCH THIRD PARTY CLAIMS.
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(c) The
indemnification obligations as set forth in this Section are expressly
conditioned upon the following: (i) the indemnifying party shall be notified of
any Claim promptly in writing by the indemnitee; (ii) the indemnifying party
shall have sole control of the defense or settlement of any Claim; and (iii) the
indemnified party shall cooperate with the indemnifying party in a reasonable
way to facilitate the settlement or defense of any Claim. The provisions of this
Section shall survive the termination of this Agreement.
12. Reasonableness;
Remedies. In the event either party is in breach, or threatens
to breach any covenants of this Agreement, the parties acknowledge and agree
that the other party would be greatly damaged and such damage(s) will be
irreparable and difficult to quantify; therefore, such aggrieved party may apply
for injunctive or other equitable relief to restrain such breach or threat of
breach, without impairing, invalidating, negating or voiding such party’s rights
to relief in either law or equity. In the event that any or all of the covenants
hereunder are determined by the court of competent jurisdiction to be invalid or
unenforceable, by reason that the breadth of restrictions is too great, or for
any other reason, these covenants shall be modified and interpreted to the
maximum extent to which they may be enforceable.
13. Miscellaneous.
(a) This
Agreement may not be transferred or assigned by either party, without the prior
written consent of the other party.
(b) The
invalidity or unenforceability of any particular provision of this Agreement
shall not affect the other provisions of this Agreement, and this Agreement
shall be construed in all respects as if such invalid or unenforceable provision
were omitted. No waiver by any party of any breach of any provision hereof shall
constitute a waiver of any other breach of that or any other provision
hereof.
(c) The
parties acknowledge and agree that during the term of the License, Licensor
shall be deemed to be an intended and named third party beneficiary of any
sublicense agreements between Licensee and sublicensees.
(d) Although
Licensor shall have the right and authority to set and enforce general quality
standards for Licensee’s and sublicensees’ use of the Marks during the term of
the License, Licensor shall not have the right to, and shall not otherwise
control, direct or manage the specific means or manner in which services are
provided by Licensee or sublicensees under the Marks, or to control, direct or
manage Licensee’s or sublicensees’ daily operations.
(e) The
parties invoke the laws of the State of Georgia, USA, regarding the protection
of their rights and enforcement of their obligations hereunder, and they
mutually stipulate and agree that this Agreement is in all respects (including
but not limited to, all matters of interpretation, validity, performance and the
consequences of breach and termination) to be exclusively construed, governed
and enforced in accordance with the internal laws of the State of Georgia, USA,
excluding all conflict of laws rules, as from time to time amended and in
effect. Any action related to or arising out of this Agreement shall
be brought solely in a court of competent jurisdiction in the state of Georgia,
Xxxx County, and the parties irrevocably commit to the jurisdiction of said
courts.
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(f) The
headings and captions used in this Agreement are for convenience of reference
only and shall in no way define, limit, expand or otherwise affect the meaning
or construction of any provision of this Agreement.
(g) All
notices under this Agreement required to be given hereunder shall be given in
writing and shall be delivered either by hand, by nationally recognized
overnight courier, fees pre-paid by sender, or by facsimile or email (with
confirmation copy sent by U.S. Mail) addressed to the receiving
party. Any such notice shall be deemed delivered upon the earlier of
actual receipt or three (3) days after deposit of such notice, properly
addressed and delivery fees paid, with the overnight courier, or at the time of
delivery by facsimile or email if such delivery is made by 5:00 o’clock p.m.
and, if not, as of 8:00 o’clock a.m. (local time of the receiving party) on the
next following business day.
(h) Neither
party shall be responsible for any delay or failure in performing any part of
this Agreement when it is caused by fire, flood, explosion, war, strike,
embargo, government requirement, civil or military authority, act of God, act or
omission of carriers or other similar causes beyond its control.
(i) This
Agreement may be executed in any number of counterparts, each of which shall be
deemed an original, but all of which together shall be deemed for all purposes
to constitute one and the same instrument.
(j) The
parties hereto acknowledge and agree that any Sections which by their nature are
intended to survive the termination of this Agreement shall so survive,
including Sections 1, 6, 7, 8(e), 9(e), 10, 11, 12 and 13.
(k) Each
party is responsible for complying with all laws applicable to their performance
under this Agreement, including any restrictions under import and export
laws.
(l) This
Agreement together with the Exhibits hereto, if any, constitutes the entire
agreement between the parties with respect to the subject matter of this
Agreement, and supersedes any prior agreements or understandings, whether oral
or written, between the parties with respect to such subject matter. No
amendment or waiver of this Agreement or any provision hereof shall be effective
unless in a writing signed by both of the parties.
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date
hereof.
|
Preferred
Apartment Communities, Inc.
|
Preferred Apartment Advisors, LLC | ||||
| By: |
/s/
Xxxx X. Xxxxxxxx
|
By: |
/s/
Xxxxxxx X. Xxxxxxxxxxx
|
||
| Name: |
Xxxx
X. Xxxxxxxx
|
Name: |
Xxxxxxx
X. Xxxxxxxxxxx
|
||
| Title: |
Chief
Executive Officer
|
Title: |
Executive
Vice President
|
||
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Exhibit
A
8
Exhibit
B
Additional Consideration, if
any:
The
parties acknowledge that the consideration for the license and assignment
granted to Licensee herein includes Licensee’s indemnification obligations as
well as Licensee’s agreement to pay all costs and fees associated with
prosecuting and maintaining the Applications and pursuing infringement claims
against third parties. Prior to the assignment, Licensee will reimburse Licensor
for all prosecution and maintenance costs and fees. Subsequent to the
assignment, Licensee will directly incur all such expenses.
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