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EXHIBIT 10.26
SUZY'S ZOO
LICENSE AGREEMENT
with
GERBER CHILDRENSWEAR, INC.
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LICENSE AGREEMENT
This License Agreement is made and entered into by and between, SUZY'S ZOO a
corporation organized under the laws of the State of California, having its
principal office and place of business at 0000 Xxxxxx Xxxxxx, Xxxxx 000, Xxx
Xxxxx, Xxxxxxxxxx 00000-0000, XXX (hereinafter "LICENSOR"); duly represented by
MOON MESA MEDIA, LLC, a limited liability company organized under the laws of
the State of California, having its address at 00000 Xxxxxxx Xxxxxxxxx, Xxxxx
000, Xxxxxxx Xxxx, Xxxxxxxxxx 00000, joining in as the exclusive representative
of the LICENSOR (hereinafter "REPRESENTATIVE"); and GERBER CHILDRENSWEAR, INC.,
a corporation organized under the laws of the State of Delaware, having its
principal address at 0000 Xxxxxx Xxxx, Xxxxxxxxxx, XX 00000 (hereinafter
"LICENSEE").
RECITALS:
A. LICENSOR is the proprietor of copyrights and all rights therein
throughout the world in certain works, and by grant from XXXXXXX
XXXXXXXX XXXXX has acquired the right to license certain other works
throughout the world, such works including the particular works
identified on Schedule A attached hereto, or added by future Addendum
thereto, and incorporated herein by reference (the identified works
hereinafter referred to as "Licensed Works").
B. LICENSOR has adopted, used, and is the proprietor of the trademark
SUZY'S ZOO(R) and numerous trademark registration and applications
therefor throughout the world, including registrations in the United
States and Canada (hereinafter "Licensed SUZY'S ZOO Trademark").
C. REPRESENTATIVE is the sole and exclusive licensing and merchandising
representative of the Licensed Works and the Licensed SUZY'S ZOO
Trademark throughout the world.
D. The parties contemplate that LICENSEE may be involved in a number of
projects in which it desires to use the Licensed Works and Licensed
SUZY'S ZOO Trademark.
E. The parties contemplate that the individual projects shall be
separately addressed in separate Schedules, with each such Schedule
setting forth the specific license terms applicable to that project
(herein "Schedules").
F. The specific terms and conditions relating to the first such project
are entered on Schedule A hereto which is incorporated herein by
reference.
G. LICENSEE is desirous of obtaining license rights from LICENSOR
regarding certain products listed on Schedule A, incorporating or
displaying the Licensed Works (hereinafter "Licensed Products"), and to
use the Licensed SUZY'S ZOO Trademark on, and in connection with such
Licensed Products.
H. LICENSOR is willing to grant such a license upon and subject to certain
terms, conditions, limitations and restrictions as set forth below.
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TERMS AND CONDITIONS:
NOW, THEREFORE, in consideration of the foregoing recitals and
of the mutual covenants and conditions set forth below, the parties hereby agree
as follows:
1. GRANT AND ACCEPTANCE OF LICENSE
a. LICENSOR hereby grants to LICENSEE, for the term of this
Agreement, subject to the terms and conditions herein set
forth, the right, privilege and license to make, have made,
sell and distribute in the Territory the Licensed Products and
to use the Licensed SUZY'S ZOO Trademark only on and in
connection with such Licensed Products, as further specified
on Schedule A. The parties contemplate that additional license
rights may be granted in the future, and that such rights will
be defined by additional schedules denominated consecutively
B, C, D, E... Z, AA, BB, CC as required, taken in connection
with this Agreement.
b. "Territory," as used herein shall initially mean the
geographic areas identified on Schedule A attached hereto and
incorporated herein by reference. It is contemplated that the
Territory may be different for each project, and in this sense
may be modified during the term of this Agreement by addition
of further Schedules, as well as modification of Schedule A
hereto.
c. The rights granted hereunder shall pertain only to the
specifically identified Licensed Works. The Works included in
the Licensed Works may be added or deleted to the extent that
new scheduled projects define a different group of works or
Schedule A or any subsequent Schedule is modified.
d. The rights granted hereunder are further limited and defined
as to specific categories of products, Territories, markets
and exclusivity for areas of endeavor by LICENSEE or its
agents or distributors as set forth on Schedule A or
subsequent Schedules.
e. New projects, and any changes in the scope of rights granted
hereunder, as well as the particulars of the nature and scope
of rights granted in relation to any particular project, shall
be addressed through addendum to this Agreement, adding or
deleting or modifying Schedules hereto.
f. LICENSEE hereby accepts the foregoing license from LICENSOR,
and shall exercise its reasonable best efforts to establish
and maintain reasonable and customary industry standards of
quality, style and appearance, not inferior to the quality,
style and appearance of the products made and sold by LICENSOR
under the Licensed SUZY' S ZOO Trademark, for the Licensed
Products which LICENSEE endeavors to make, have made, use, and
sell under this Agreement. LICENSEE shall implement adequate
quality control procedures to satisfy any applicable
governmental regulatory or legal requirement applicable
thereto and to
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protect the reputation for high quality which LICENSOR has
achieved for its own products. Distribution of the Licensed
Products under this Agreement shall be under LICENSEE's own
brand name, "Gerber Childrenswear,"or under such other brand
names as LICENSOR may in advance and in writing approve, and
LICENSEE shall not include the Licensed SUZY'S ZOO Trademark,
or any portions thereof, in its corporate or business name.
g. LICENSEE shall use due diligence and exercise its reasonable
best efforts in accordance with good business practice, during
the term of this Agreement, to promote, manufacture and sell
each Licensed Product.
h. In order to effect the use of the Licensed Works, LICENSOR
shall supply LICENSEE with artwork for each of the Licensed
Works. Artwork shall consist of character designs presently
contained in LICENSOR'S character design library or
adaptations thereof, or new designs created at LICENSEE'S
request. All artwork used in connection with Licensed Works
shall be produced by LICENSOR. Such artwork supplied to
LICENSEE shall be used only in connection with the performance
of this Agreement and shall remain the property of LICENSOR.
There will be no additional charge (other than incidental
shipping charges and the like) for supply of art which can be
used directly from the existing library of designs maintained
by LICENSOR. The art fee on a piece-by-piece basis for
creation of new designs or adaptations of existing designs to
other media and/or reproduction processes shall be as
specified in the applicable Schedule. The negotiated art fee
is payable on delivery of artwork to LICENSEE. Such artwork
comprising new designs and adaptations shall be licensed
hereunder to LICENSEE in the same manner as other Licensed
Works, as specified on the applicable Schedule or Schedules.
2. LICENSE TERM
a. The term of this Agreement shall commence as of the date this
Agreement is executed on behalf of LICENSOR or REPRESENTATIVE,
or on the effective date set forth in the applicable Schedule,
whichever shall first occur, and shall continue as provided in
Schedule A hereto, unless earlier terminated in accordance
with other provisions of this Agreement.
b. The term of this Agreement may be renewed at the option of
LICENSEE to the extent, if any, provided in a Schedule hereto.
However, LICENSOR shall have the right to cancel this
Agreement at the end of its original term and any subsequent
renewal term in the event royalties accruing based on actual
sales are insufficient to meet a minimum royalty condition or
any other condition set forth in the Schedule relating to
renewal has not been satisfied.
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3. ROYALTIES
a: For the rights licensed herein, LICENSEE shall pay
REPRESENTATIVE on behalf of LICENSOR royalties on Net Sales of
Licensed Products in accordance with the particular Schedule
to which royalty bearing activities producing such royalties
pertain, unless in any particular Schedule the basis for
royalty calculation is other than Net Sales as defined herein.
In the latter case the basis shall be specifically set forth
in the applicable Schedule. Annual Advances and Guaranteed
minimum royalties, if applicable, shall be included in each
scheduled project and stated in the applicable Schedule.
Unless otherwise specifically provided for in the applicable
Schedule, advances and guaranteed royalty amounts shall be
paid in advance, within the first five (5) business days of
the period to which they apply, and thereafter applied as a
set-off against future earned royalties accruing to
REPRESENTATIVE on behalf of LICENSOR as specified herein.
b. Unless otherwise provided in a particular Schedule, the basis
for calculation of royalties shall be Net Sales. "Net Sales"
for purposes of this Agreement shall mean gross selling price
by LICENSEE, its distributors, agents, etc. at the wholesale
level just prior to retail, to customers for the sale of
Licensed Products, or the price actually paid, whichever is
higher, less sales taxes, shipping costs, customary discounts
and allowances, and credits for returns actually made and
allowed (hereinafter "Deductions"). In computing Net Sales, no
costs incurred in manufacturing, selling, advertising or
distributing the Licensed Products covered by this Agreement
other than those set forth above shall be deducted, nor shall
any deduction be made for uncollectible accounts. Net Sales
shall be deemed to have occurred and royalties shall accrue
when the Licensed Products are sold, shipped, distributed,
billed and/or paid for, or invoiced, whichever comes first.
Non-cash, trade-in-kind and other barter transactions shall be
accounted as if sold at the highest catalog list price
published by LICENSEE in the preceding year.
4. REPORTS AND PAYMENTS
a. Royalties accruing from activities hereunder shall be computed
on a periodic basis as set forth in the applicable Schedule.
Within thirty (30) days after the end of each such accounting
period, LICENSEE shall provide to REPRESENTATIVE a written
report, in the format and with the content set forth under
subparagraph 4.b below, and shall pay REPRESENTATIVE all
royalties accruing hereunder during such period. Within thirty
(30) days following any termination or expiration of this
Agreement, LICENSEE shall render a written closing report to
REPRESENTATIVE applicable to any sales not previously
reported, said report to be accompanied by payment of
royalties, if any, not previously paid. Said closing report
shall also include an inventory of all Licensed Products on
hand and in process of manufacture for LICENSEE upon
termination or expiration of this Agreement.
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b. Each and every report shall show in detail, for the accounting
period to which the report pertains, activity under each
scheduled project hereunder, including the identities and
quantities of Licensed Products sold hereunder, the actual
invoice or billing price of the Licensed Products supplied,
the actual price paid for them if more than the invoice price,
the applicable Deductions, and the royalties due from
LICENSEE. Each such report shall include a computation of the
royalty accrued, and any set-offs against royalties due and
owing (e.g., advance royalties paid). The methods used in
computing and reporting the required information shall be in
conformity with standard accounting practice.
5. BOOKS AND RECORDS
a. LICENSEE shall keep and maintain true and complete books and
records pertaining to its manufacture, purchase, supply and
sale of Licensed Products. LICENSEE shall be responsible for
assuring that such books and records shall be kept, and the
information maintained in sufficient detail to enable the
royalties payable to REPRESENTATIVE for each of the Licensed
Products to be accurately determined, as well as the sales and
pricing information required under this Agreement.
b. LICENSEE shall make such books and records available, upon
request, at reasonable times during regular business hours for
inspection by REPRESENTATIVE, at REPRESENTATIVE'S expense, and
supply REPRESENTATIVE with the details and supporting data
necessary to verify the reports and payments required by this
Agreement. No more than one (1) such examination may be made
during any twelve (12) month period that this Agreement is in
effect.
c. If an error of more than five percent (5%) in royalty payments
made since the beginning of the license term or the last
inspection, as applicable, is discovered during any such
inspection, the costs to REPRESENTATIVE for such inspection
shall be borne by LICENSEE.
d. LICENSEE shall maintain its books and records relevant to this
Agreement for at least two (2) years after the end of the
calendar year to which they pertain.
6. SUPERVISION AND APPROVAL
a. All Licensed Products manufactured and sold hereunder, as well
as all labels, packaging, catalogs, brochures, advertising and
other forms of publicity, shall be created and designed to be
of reasonable and customary industry standard of quality so as
to protect and preserve the image and goodwill that are
associated by the public with LICENSOR, and LICENSEE shall
conduct its business accordingly under this Agreement.
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b. All Licensed Products manufactured and sold hereunder shall
meet all applicable product safety, consumer protection, and
product liability requirements, including those provided by
federal, state, and local laws and regulations, and also those
requirements covering the activities of LICENSEE adopted by
the industry whereunder LICENSEE operates; and LICENSEE shall
at all times conduct its business in accordance with such
laws, regulations, and requirements under this Agreement.
c. All Licensed Products manufactured and sold hereunder, and all
labels, packaging, catalogs, brochures, advertising and other
forms of publicity material for the Licensed Products, shall
be subject to LICENSOR's written approval in advance of use.
Failure of LICENSOR to disapprove an item within ten (10)
working days of receipt of a representative sample shall be
deemed an approval provided LICENSEE gives LICENSOR and
REPRESENTATIVE three (3) days prior written notice of its
intent to invoke the deemed approval and neither LICENSOR nor
REPRESENTATIVE objects within said three (3) day period.
Without cost to LICENSOR, LICENSEE shall submit to LICENSOR
for its inspection and written approval, at reasonable times
in advance of manufacture, sale or distribution, as
applicable: 1) a proposed design for each proposed Licensed
Product to be sold by LICENSEE; 2) [INTENTIONALLY OMITTED]; 3)
a production sample thereof; as well as a pre-production
sample and a production sample of each proposed label,
package, catalog, brochure, advertisement, and such other
forms of material containing or relating to Licensed Works or
Licensed Products as may be applicable, which LICENSEE
proposes to use in connection with activities hereunder,
including the promotion or sale of the Licensed Products. This
right of prior approval shall be at the sole discretion of
LICENSOR who shall act in good faith, and approval in writing
or by failure to respond shall be a condition of the right to
exercise the grant of license hereunder. LICENSEE shall not
materially depart from any approved sample submitted, without
LICENSOR's prior consent obtained in writing or by failure to
respond after submission of a new sample incorporating the
material departures from a previously approved sample.
d. LICENSEE will provide LICENSOR, without cost to LICENSOR, a
sample of each Licensed Product actually offered for sale or
sold, and of each label, packaging, catalog, brochure,
advertisement or other form of publicity material therefor,
which LICENSOR may periodically request to assure adherence of
LICENSEE to the requirements of this Agreement.
e. For purposes of this Agreement a "sample" shall consist of
four (4) specimens of each Licensed Product, label, package,
catalog, brochure, advertisement or such other forms of such
material containing or relating to Licensed Works as may be
applicable.
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7. COPYRIGHTS AND TRADEMARKS
a. LICENSEE recognizes the great value of the goodwill that is
associated with the Licensed SUZY'S ZOO Trademark and the
Licensed Works, including the characters that are the subject
thereof, and LICENSEE acknowledges that as between the parties
such goodwill is owned exclusively by LICENSOR and any
goodwill that may be created by the use of the Licensed SUZY'
S ZOO Trademark and the Licensed Works by LICENSEE hereunder
shall inure to the benefit of LICENSOR. LICENSEE further
acknowledges that, as between the parties, all right, title
and interest in and to the Licensed SUZY'S ZOO Trademark and
the Licensed Works are owned exclusively by LICENSOR,
including the right to use the Licensed Works and the Licensed
SUZY' S ZOO Trademark in LICENSOR's own business.
b. The copyrights in Licensed Works shall remain in the sole and
exclusive control of LICENSOR. Any adaptation or modification
of Licensed Works or new works prepared under this Agreement,
any copyrights therein, and all of the rights comprised in
said copyrights, shall be in the sole and exclusive control of
LICENSOR. If LICENSEE develops or acquires any such
adaptation, modification or new work, LICENSEE shall assign to
LICENSOR the copyright in any such adaptation, modification or
new work, and shall execute all documents reasonably required
or requested to effect such assignment or to permit LICENSOR
to register or maintain title to copyright in any such
adaptation, modification or new work, in LICENSOR.
c. Adaptations and modifications of Licensed Works and new works
prepared under this Agreement shall be included as part of
said Licensed Works.
d. LICENSEE shall take reasonable precautions in dealing with its
suppliers to preserve LICENSOR'S copyright and trademark
rights and to prevent infringement thereof.
8. PRODUCT MARKING
a. Licensed Products made and sold by LICENSEE hereunder and all
labels, packaging, catalogs, brochures, advertising and other
forms of publicity material for the Licensed Products, which
incorporate or display the Licensed Works, shall be marked
with an appropriate copyright notice. Such notice shall be of
proper form and content and be properly displayed in a manner
that complies with all applicable laws in the particular
location within the Territory where each Licensed Product is
sold, as well as the Universal Copyright Convention. An
initial approved copyright notice for each of the Licensed
Works shall be provided by LICENSOR, in connection with
provision of copies of the Licensed Works, or artwork
embodying same, to LICENSEE.
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b. Licensed Products, where reasonably feasible, and, in any
event, labels, packaging, catalogs, brochures, advertising and
other forms of publicity material for the Licensed Products,
shall state that the Licensed Products incorporating or
displaying Licensed Works are made under this Agreement, as,
for example, by stating:
"Made under license from SUZY' S ZOO(R),
San Diego, California, U.S.A."
c. The Licensed SUZY'S ZOO Trademark, which is registered in the
United States and elsewhere, shall be displayed with an
appropriate trademark registration notice in accordance with
applicable United States trademark law (i.e. (R)), or other
applicable' law within the Territory, as appropriate.
d. LICENSEE shall provide LICENSOR, upon request to LICENSEE,
with such reasonable quantities of identical specimens of
items incorporating or displaying Licensed Works or works
derived therefrom, and of any labels, packaging, catalogs,
brochures, advertising and other forms of publicity material
therefor, reasonably necessary for copyright or trademark
registration purposes. LICENSEE shall also provide LICENSOR,
upon request to LICENSEE, with all use dates and other
information necessary to enable LICENSOR to apply for and
obtain registration of copyrights and trademarks.
9. INDEMNIFICATION, INSURANCE AND INFRINGEMENT
a. LICENSEE shall defend, indemnify and hold harmless LICENSOR
and its officers, employees and agents, including
REPRESENTATIVE (hereinafter collectively referred to as the
"Indemnified Parties") from and against any and all claims,
demands, suits, losses, injuries, or liabilities arising out
of the manufacture or sale of the Licensed Products or
resulting from LICENSEE's exercise of the license granted
hereunder.
b. LICENSEE shall obtain and maintain at all times product
liability insurance for the Licensed Products in an amount of
coverage reasonable and adequate in view of all relevant
circumstances. Such product liability insurance shall cover
any claims, demands, causes of action or property or personal
injury damages, including reasonable attorneys' fees, arising
from or out of any alleged defects in the Licensed Products,
or otherwise from or out of any use or misuse of the Licensed
Products. The limit of coverage shall be based upon both the
nature of the Licensed Product and the environment in which it
may be used. Such insurance policy or policies shall in any
event contain a combined single limit of no less than one
million dollars ($1,000,000.00) for bodily injuries and
property damage arising out of each occurrence, and, if
reasonable and prudent business practice dictates a higher
limit, as reflected in common practice in the industry, or by
another verifiable and accepted standard throughout the
industry, such higher minimum
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limit shall apply. A Certificate of Insurance demonstrating
compliance with the provisions of this paragraph by LICENSEE
and naming LICENSOR and REPRESENTATIVE as additional insureds
shall be provided to REPRESENTATIVE on an annual basis upon
request by REPRESENTATIVE. Such insurance shall provide that
it may not be canceled without 30 days' prior written notice
to LICENSOR and REPRESENTATIVE. LICENSEE shall give immediate
notice to LICENSOR of all occurrences that might reasonably be
expected to result in any claim against it or any one or more
of the Indemnified Parties, or which could impose any
liability upon any one or more of the Indemnified Parties.
c. LICENSEE shall promptly notify LICENSOR of any infringement or
suspected infringement of the copyrights in the Licensed Works
or the trademarks that comprise the Licensed SUZY'S ZOO
Trademark by any third party. Any action taken by LICENSEE to
enforce said copyrights or trademarks against such infringers,
including the giving of notice of infringement of the
institution of legal proceedings, shall be subject to the
prior approval of LICENSOR. LICENSOR shall not be obligated to
take any such action, and any decision to take such action by
LICENSOR, and the conduct of any such action taken, shall be
entirely within the discretion and control of LICENSOR.
LICENSEE shall cooperate fully with LICENSOR in any such
action LICENSOR may choose to take in this regard. If LICENSOR
elects not to proceed with such action and if any such
infringement or imitation by a third party shall materially
interfere with LICENSEE'S exercise of the rights granted to it
under this Agreement, LICENSEE may terminate this Agreement
prospectively by so notifying LICENSOR in writing, without
limitation of any other rights or remedies LICENSEE may have,
subject to the payment to LICENSOR of all Royalties then due
or accrued to LICENSOR in respect of sales made through the
date of LICENSEE'S termination of this Agreement.
10. PROTECTION OF LICENSOR'S RIGHTS
a. LICENSEE and LICENSOR shall each cooperate with the other
party as reasonably required to protect and maintain the
copyrights in the Licensed Works and the trademarks that
comprise the Licensed SUZY'S ZOO Trademark.
b. LICENSEE shall not challenge or contest LICENSOR'S ownership
of the copyrights in the Licensed Works or the trademarks that
comprise the Licensed Trademark, or their validity, or the
validity of the License granted hereunder.
c. LICENSEE shall protect and preserve LICENSOR's copyrights and
trademarks, subject to the provisions of paragraphs 7 and 9.c
above, and in no way whatsoever will LICENSEE harm or misuse
them or otherwise cause them to be reduced in value to
LICENSOR. In this connection, LICENSEE will not manufacture,
advertise, sell, or distribute the Licensed Products in any
manner which violates
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applicable laws, the terms of this Agreement, standards of
reasonable and ethical business practice, or commonly accepted
standards of propriety.
11. TERMINATION
a. In the event of any material breach of this Agreement, or any
default in performance by LICENSEE, including the failure to
pay royalties when due, LICENSOR may, at its option, terminate
this Agreement by giving written notice thereof. However,
LICENSEE shall have thirty (30) days following receipt of such
notice within which to cure the breach or default and thus
reinstate this Agreement as of the date of such notice.
b. This Agreement may, in the sole discretion of LICENSOR, be
terminated on ten (10) days written notice from LICENSOR as to
any and all Licensed Works, as listed on the applicable
Schedule, that are not actively marketed and sold in
connection with Licensed Products within a time period of
ninety (90) days from the effective date of this Agreement, or
ninety (90) days from the date any such Licensed Work is added
to this Agreement by inclusion in one of the Schedules hereto,
whichever is later.
c. This Agreement shall be automatically and immediately
terminated if any one or more of the following events occur:
1. The filing of a voluntary or involuntary petition in
bankruptcy with respect to LICENSEE;
2. The execution by LICENSEE of an assignment for the
benefit of creditors or a compromise with creditors;
3. The insolvency of LICENSEE, as that term is defined
under United States federal bankruptcy law; or
4. The appointment of a receiver for LICENSEE or any of
its property;
provided, however, that LICENSEE shall have ninety (90) days
following such event within which to nullify the event or the
effect of the event, in which case the Agreement shall be
automatically and immediately reinstated.
d. Provided this Agreement shall not have been terminated for
LICENSEE'S breach, LICENSEE shall have the non-exclusive
right, upon termination or expiration of this Agreement, to
sell all of its then-existing inventory of Licensed Products,
including items in process in the normal course of its
business, during the three (3) month period immediately
following such termination or expiration. Notwithstanding any
other provisions of this Agreement, all obligations and
requirements of this Agreement shall apply to sales of
Licensed Products during
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the three (3) month sell-off period, including payment of
royalties thereon and the reporting requirements regarding
such sales. LICENSEE shall refrain from manufacturing, selling
and distributing any Licensed Products, whether during the
term of this Agreement or following the termination or
expiration thereof, which fail to meet the within requirements
of quality, product safety, consumer protection and product
liability, or fail to carry appropriate copyright or trademark
notices. Upon the expiration of the three (3) month sell-off
period, any further stock on hand of Licensed Products shall
be destroyed. LICENSEE shall not manufacture quantities of
Licensed Products in anticipation of the sell-off period which
materially exceed the quantities LICENSEE could anticipate
selling prior to the expiration of this Agreement.
e. LICENSEE acknowledges that a failure (except as otherwise
expressly provided herein) to cease the manufacture, sale or
distribution of the Licensed Products upon the termination or
expiration of this Agreement will result in immediate and
irreparable damage to LICENSOR. LICENSEE further acknowledges
that there is no adequate remedy at law for such failure to
cease manufacture, sale or distribution, and, in the event of
such failure, LICENSOR shall be entitled to equitable relief
and such further relief as a court or agency with jurisdiction
may deem just and proper.
f. Termination of this Agreement for any reason shall not relieve
LICENSEE of its obligation to pay all royalties owing or
accrued prior to the termination.
g. Upon termination of this Agreement, all of the rights granted
hereunder to LICENSEE shall revert to LICENSOR. Except as
herein provided, LICENSEE will cease and desist from
manufacturing, selling or distributing Licensed Products
incorporating or displaying the Licensed Works, and from
making any use whatsoever of the Licensed Works or the
Licensed SUZY'S ZOO Trademark. Upon the termination of this
Agreement, all original artwork bearing or incorporating the
Licensed Works in the custody or control of LICENSEE shall be
returned to LICENSOR and any other materials incorporating,
displaying or otherwise making use of Licensed Works,
including, but not limited to, plates, masks, transparencies,
negatives, screens, and the like, computer data or algorithms,
or other electronic means of incorporating or embodying same,
as well as any other non-product representations bearing or
incorporating the Licensed Works owned by, or within the
custody or control of, LICENSEE, shall be destroyed.
12. LICENSOR REPRESENTATIONS
LICENSOR represents that LICENSOR is free to enter into this Agreement;
that the Licensed Works are LICENSOR's own and original creations (except for
matters in the public domain or material which LICENSOR is fully licensed to
use); and that, to the best of LICENSOR's knowledge, the Licensed Works, and the
manufacture, advertisement, distribution
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and sale hereunder of same embodied in the Licensed Products, do not infringe
upon any rights of any third party. LICENSOR shall defend, indemnity and hold
harmless LICENSEE and its officers, employees and agents, from and against any
and all claims, demands, suits, losses, or liabilities, including, but not
limited to, reasonable outside attorneys' fees, arising from copyright or
trademark infringement claims by third parties and arising solely out of the use
by LICENSEE of the LICENSED PROPERTY as authorized under this Agreement.
13. GOVERNING LAW, DISPUTE RESOLUTION, FORUM SELECTION AND JURISDICTION
This Agreement shall be governed by and construed under the laws of the
State of California of the United States of America, without regard to choice of
law principles. Any dispute arising under this Agreement which cannot be
resolved by the parties within thirty (30) days after it arises shall be
submitted to binding arbitration in San Diego County of said State of
California, in accordance with the rules for expedited arbitration of the
American Arbitration Association and the parties hereby expressly accept and
submit to such jurisdiction. The prevailing party shall be entitled to recover
its reasonable attorney's fees and costs of arbitration from the non-prevailing
party.
14. FORCE MAJEURE
In the event either party hereto is prevented from performing or is
unable to perform any of its obligations under this Agreement due to fire,
flood, earthquake, state of war, governmental regulation, national emergency,
strikes, lockouts, labor troubles, failure of public utilities, injunctions, or
other events beyond the reasonable control of the party affected, the affected
party shall give notice promptly to the other party in writing and, thereupon,
the affected party's non-performance shall be excused and the time for
performance of this Agreement shall be extended for the period of delay or
inability due to such Force Majeure, but for not more than one (1) year in the
aggregate. Any royalties due or accrued as of the commencement date of such
event of Force Majeure shall be paid within thirty (30) days thereafter.
15. ATTRIBUTES OF NOTICES, REPORTS AND PAYMENTS
Any notice, approval, report or payment required or permitted under the
terms of this Agreement shall be in writing and sent by certified or registered
mail, postage prepaid, return receipt requested, or by facsimile transmission
with confirmation sent by certified or registered mail, postage prepaid, return
receipt requested, or by courier (e.g. Federal Express, UPS, DHL, and the like)
with confirmation of receipt by signature requested.
Notices to the parties shall be addressed as follows:
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To LICENSOR: Xx. Xxxxxxx X. Xxxxxxxx
President
SUZY'S ZOO
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000-0000
Facsimile: (000) 000-0000
To REPRESENTATIVE: Xxxxxx X. Xxxxx
Chief Executive Officer
MOON MESA MEDIA, LLC
00000 Xxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx Xxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
To LICENSEE: Xxxxx Xxxxxxx
V.P., Marketing and Creative Services
Gerber Childrenswear
0000 Xxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
A proper notice shall be deemed to have been given when sent, subject to proof
of receipt.
16. GENERAL PROVISIONS
a. The parties to this Agreement are independent contractors, and
nothing herein contained shall be construed so as to place the
parties in the relationship of partners or joint venturers,
and LICENSEE and its sublicensees, if any are permitted
hereunder, shall have no power to obligate or bind LICENSOR in
any manner whatsoever. Neither LICENSEE nor LICENSOR is
authorized to or shall act as the agent of the other, except
for the express purpose of obtaining any necessary government
approvals of this Agreement and the payments to be made
hereunder should such approvals be required.
b. This Agreement sets forth the entire agreement and
understanding of LICENSOR and LICENSEE with respect to the
subject matter hereof, and supersedes any prior agreements,
arrangements and understandings between them. No
representation, promise or inducement has been made by any
party that is not embodied in this Agreement, and no party
shall be bound by, or liable for, any alleged representation
or promise of inducement not so set forth. Any changes made to
this Agreement or the Schedules thereto shall be in writing
and signed by an authorized representative of each of the
respective parties.
c. This Agreement is personal to LICENSEE, and neither the
Agreement nor any of LICENSEE's rights or obligations
hereunder may be assigned, pledged, encumbered or sublicensed
by LICENSEE without prior written consent of LICENSOR, not to
be unreasonably withheld. However, should LICENSEE'S
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rights hereunder be sublicensed, with the consent of LICENSOR
or as otherwise provided herein, all the terms and conditions
of this Agreement which reasonably could, and in law-or equity
should, be applied to a Sublicensee shall be applied thereto,
whether or not in any instance a Sublicensee or applicability
of any particular term of this Agreement thereto is mentioned.
For purposes of this subparagraph c, a purchaser of all or
substantially all of the issued and outstanding shares of the
capital stock of LICENSEE shall be considered a successor,
regardless of the form of the transaction, in which event
LICENSEE shall so notify LICENSOR in writing, but no consent
from LICENSOR shall be required.
d. Subject to the provisions of subparagraph 16.c above, and
where not otherwise inconsistent with the terms of this
Agreement, this Agreement shall be binding upon and inure to
the benefit of the successors, heirs and assigns of LICENSOR
and LICENSEE.
e. This Agreement may be amended, modified, superseded, or
canceled, or the terms or covenants hereof waived, only by a
written instrument executed by the parties hereto, or in the
case of a waiver, by the party waiving compliance. The failure
of either party at any time to require performance of any
provision hereof shall not affect the right at another time to
enforce the same. No waiver by either party of the breach of
any term or covenant contained in this Agreement shall be
deemed to be a continuing waiver of any such breach or a
waiver of the breach of any other term or covenant contained
in this Agreement.
f. Any provision of this Agreement which in any way contravenes
or is unenforceable under any law of a state or locality in
which this Agreement is effective shall be deemed separable
and not a part of this Agreement and to that extent void.
However, all remaining provisions of this Agreement shall be
valid and in full force and effect, and the parties shall
negotiate in good faith a replacement provision that is in
harmony with applicable law and effects, insofar as possible,
the original purpose of the Agreement term in question.
g. The captions are inserted herein only as a matter of
convenience and for reference, and in no way define, limit or
describe the scope of this Agreement or the intent of any
provision herein.
h. This Agreement may be executed in one or more counterparts,
each of which shall for all purposes be deemed to be an
original and all of which shall constitute the same
instrument. Facsimile signatures shall be accepted as proof of
execution.
i. In the event LICENSOR shall provide notice to LICENSEE that
LICENSOR has ceased utilizing the services of REPRESENTATIVE,
all obligations otherwise accruing to REPRESENTATIVE hereunder
shall accrue to LICENSOR.
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed effective as of the day and year first above written.
SUZY' S ZOO ("Licensor")
/s/ Xxxxxxx X. Xxxxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxxxx, President
4/14/99 Date
-------
MOON MESA MEDIA, LLC ("Representative")
/s/ Xxxxxx X. Xxxxx, CEO
----------------------------------------
Xxxxxx X. Xxxxx, CEO
4/13/99 Date
-------
GERBER CHILDRENSWEAR, INC. ("Licensee")
/s/ Xxxxx X. Gold
----------------------------------------
Xxxxx X. Gold, Senior Vice President
4/13/99 Date
-------
APPROVED:
/s/ Xxxxxxx Xxxxxxxx Xxxxx
----------------------------------------
Xxxxxxx Xxxxxxxx Xxxxx
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Schedule A
to
LICENSE AGREEMENT
between
SUZY'S ZOO ("Licensor") and GERBER CHILDRENSWEAR, INC. ("Licensee")
(continued on next page)
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LICENSED INFANT BEDDING
PRODUCTS: Comforter*
Bumper*
Crib Sheets*
Receiving Blankets*
Crib Blankets*
Baby Blankeys (security blanket)
Hooded Towel & wash mitts*
Wash cloths*
Crib ruffle*
Diaper stacker*
Laundry bag
Sheet saver
Birth certificate and decorative pillows (non-exclusive)*
Window Treatments to coordinate with bedding patterns only, to
be approved on a case by case basis (non-exclusive)
Wall borders to be supplied by LICENSOR'S designated
Wallpaper licensee (non-exclusive)
Pack & play sets
INFANT LAYETTE
Sleep n play*
Pajamas (infant to 4T)
Prams/pram bags
Gowns/Dorm Shirts
Blanket Sleepers (infant to 4T)*
One-piece underwear*
Infant Gowns*
Undershirts (slip-on & snap-side)
Caps*
Booties*
Union suits
Coveralls
2 piece underwear sets
Cardigan set
Burp cloths
Bibs
Overalls (infant to 4T) (non-exclusive)
Gift Sets (non-exclusive, it being
understood that others who wish to include
goods exclusively licensed hereunder in gift
sets must acquire those goods from LICENSEE,
and that LICENSEE may elect whether or not
to provide those goods in its own
discretion. LICENSEE understands the same
conditions will apply should it wish to use
goods in gift sets under exclusive license
to others of LICENSOR'S licensees.)*
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LICENSED Little Suzy's Zoo - specific character set as delineated in
WORKS: style guide. No derivative rights will be granted at this
time.
TERRITORY: United States (including its territories, its military bases
throughout the world and international stores of United States
retailers to which LICENSEE is marketing in the United States
and Canada. In the event LICENSOR shall, in its sole
discretion, elect to license the Licensed Products outside the
Territory, LICENSEE shall have a 30 day right of first
negotiation with respect to acquiring such license. In the
event LICENSOR and LICENSEE cannot agree on the terms of the
license within such 30 day period, LICENSOR shall be free to
license such rights to a third party, but only on terms equal
to or more favorable than those offered by LICENSEE. If
LICENSOR is unable to negotiate terms equal to or more
favorable than those offered by LICENSEE, LICENSOR will
reconsider LICENSEE'S offer in good faith.
LICENSE TYPE: Exclusive, except where Licensed Products are specifically
noted to the contrary.
ROYALTIES: Three (3%) of Net Sales for all apparel and for bedding
products sold to mass merchants, and four percent (4%) for
bedding products sold to mid-tier merchants, with royalties to
be reported quarterly on a country-by-country basis.
GUARANTEED A total of Thirty Thousand Dollars ($30,000) during the Term,
MINIMUM payable as follows: (i) Ten Thousand Dollars ($10,000) as a
ROYALTY PAYMENT non-refundable advance payable upon execution of the License
SCHEDULE Agreement; plus (ii) Ten Thousand Dollars ($10,000) on
December 31, 1999; plus (iii) Ten Thousand Dollars ($10,000)
on December 31, 2000; to the extent not otherwise already paid
by earned Royalties prior to each of such dates, and to be
credited against earned royalties otherwise payable during the
year of the term immediately following any of such payments.
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TERM: Three (3) years and three (3) months, commencing October 1,
1998 and expiring December 31, 2001. Provided LICENSEE shall
have earned and paid at least Ten Thousand Dollars ($10,000)
in royalties during the final year of the Term, the Term may
be automatically renewed for one (1) year, provided LICENSEE
so notifies LICENSOR in writing on or before October 31, 2001.
Any future renewals shall be subject to good faith
negotiation. Provided LICENSEE has renewed the Term as
aforesaid and gives LICENSOR notice in writing of LICENSEE'S
desire to extend the Term on or before July 31, 2002, LICENSOR
will negotiate exclusively with LICENSEE regarding further
renewals for a period of up to ninety (90) days. In the event
LICENSOR and LICENSEE cannot agree on the terms of the license
within such 90 day period, LICENSOR shall be free to license
such rights to a third party, but only on terms more favorable
than those offered by LICENSEE. If LICENSOR is unable to
negotiate terms more favorable than those offered by LICENSEE,
LICENSOR will reconsider LICENSEE'S offer in good faith.
MARKETS: General consumer markets, through all channels of trade, but
excluding traditional department stores. LICENSOR will not
distribute or license others to distribute Licensed Products
incorporating Licensed Works through traditional department
stores unless in upscale product from using artwork which is
differentiated in appearance from that used by LICENSEE.
PRODUCT LICENSEE shall introduce into the Territory and Markets each
INTRODUCTION: of the Licensed Products in commercially reasonable quantities
during the Term. The first introduction to the trade in the
United States of those Licensed Products marked with an
asterisk shall occur at JPMA in October, 1998 with a retail
shelf date no later than June 30, 1999. The first introduction
to the trade in the United States of the remaining Licensed
Products shall occur no later than March 1, 2000 with a retail
shelf date no later than September 1, 2000. In the event
Licensee shall have failed to introduce any of the Licensed
Products in the United States by on or before any of the
relevant dates, this Agreement shall become non-exclusive, but
only as to those non-introduced products which otherwise were
exclusive hereunder, during the balance of the Term.
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ART CHARGES: An initial art fee of $5000 payable to LICENSOR upon execution
of the License Agreement for original artwork completed on
LICENSEE'S behalf for the mid-tier market design. The fees for
any additional designs requested by LICENSEE will be charged
as follows -
$100/design for adaptations of existing artwork to fit other
media, reproduction, methods or formats
$400/design for original artwork created to order LICENSEE'S
for non-exclusive use.
PRODUCT MARKING: LICENSOR'S logo and/or trademark shall be prominently
displayed on all product packaging and on all products and
marketing materials, including catalogs, sell sheets,
point-of-purchase displays and promotional materials.
APPROVALS: All individual products, the product packaging, marketing
materials and introduction dates are subject to Licensor's
approval, except as otherwise herein preapproved.
MARKETING: LICENSEE shall use its best efforts market, advertise and
promote the Licensed Products in a manner to promote and
create a presence for the Little Suzy's Zoo product line at
Trade Shows, in Trade Advertising and Product Catalogs.
SELL-OFF PERIOD: Notwithstanding anything to the contrary in Paragraph 11.d of
the LICENSE AGREEMENT, the sell-off period shall be six (6)
months.
SALES TO LICENSEE shall, if requested by LICENSOR, sell LICENSED
LICENSOR: PRODUCT to LICENSOR, at LICENSEE'S cost, for sale by LICENSOR
through LICENSOR's existing distribution channels, including,
without limitation, any further stock on hand upon expiration
of the sell-off period set forth in Paragraph 11.d of the
LICENSE AGREEMENT, should LICENSOR opt to purchase such stock
on hand in lieu of it being destroyed.
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RIDER TO
LICENSE AGREEMENT
This Rider is attached to and made part of the License Agreement
("Agreement"), dated the 10th day of March, 1999 between SUZY'S ZOO
("Licensor"), duly represented by MOON MESA MEDIA, LLC, ("Representative"), and
GERBER CHILDRENSWEAR, INC. ("Licensee"). Paragraph references herein correspond
to those contained in the Agreement.
The Agreement shall be modified as follows:
3.b The second sentence shall be deleted in its entirety and replaced with
the following:
""Net Sales" for purposes of this Agreement shall mean the gross
selling price by LICENSEE to LICENSEE'S bona fide, third party
customers for the sale of Licensed Products, less sales taxes, shipping
costs, customary discounts and allowances, and credits for returns
actually made and allowed (hereinafter "Deductions")."
The following shall be added at the end of the third sentence,
following the words, "uncollectible accounts":
"in excess of an amount equal to two percent (2%) of Net Sales or
LICENSEE'S actual uncollectible accounts, whichever shall be lower".
6.c The second sentence shall be deleted in its entirety and replaced with
the following:
"Failure of LICENSOR to disapprove an item within ten (10) working days
of receipt of a representative sample shall be deemed an approval."
11.b. This paragraph shall be deleted in its entirety and superseded by the
Section entitled "Product Introduction" in Schedule "A."
Except as herein expressly modified, the Agreement remains in full
force and effect.
END OF RIDER
/s/ RLL / SSH / DLG
-------------------
Initialed behalf of Licensor/Representative/Licensee
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