EXHIBIT 2.2
LICENSE AGREEMENT
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Midas International Corporation ("Midas") for, and in consideration
of, the promises and covenants herein contained, hereby grants to Magneti
Marelli, S.p.A ("Licensee") the exclusive right, license and privilege (the
"License") to use and authorize others to use the Midas System and the Licensed
Marks (both as defined in Exhibit A, and collectively referred to as the
"Intellectual Property") in the Territory solely in connection with the
performance of services in the automotive aftermarket repair and service
industry.
Territory: The License is limited to those countries and territories
listed on Exhibit A (the "Territory"). Licensee agrees that it will not make, or
authorize, any use, direct or indirect, of the Intellectual Property in any
other area.
Term: The term of this License as it applies to the Licensed Marks shall
be for a period of thirty (30) years beginning on the date indicated immediately
above the signatures to this License, with an option by Licensee to extend such
License for additional thirty (30) year periods on the same terms and
conditions. The term of this License as it applies to the Midas System shall be
fifteen (15) years from the date hereof. Thereafter, MARELLI's (including its
successors and assigns, if any) use of the Midas System will be on a non-
exclusive basis.
Fee and Royalty: Licensee is paying Midas at the signing of this Agreement
a License Fee of Sixteen Million Dollars (US$16,000,000). In addition, Licensee
shall pay Midas a monthly royalty based upon the total Gross Revenue (as defined
in Exhibit A) of all retail shops using the Intellectual Property in the
Territory pursuant to the Royalty Schedule (as defined in Exhibit A).
Payment: Royalty payments for each month shall be made in U.S. currency
and shall be received by Midas by the 20th day of the following month,
accompanied by a statement certified to be accurate by Licensee showing the
Gross Revenues for the preceding month. Midas shall have the right upon
reasonable notice, to examine and copy Licensee's books of account and records
insofar as they relate to the Gross Revenues reported to Midas.
Exclusive Property of Midas: Licensee acknowledges that the Intellectual
Property belongs exclusively to Midas and that upon expiration or termination of
this License, Licensee shall cease all use of the Intellectual Property promptly
and will not use the same thereafter. Licensee agrees not to misuse or harm or
bring into public disrepute the Intellectual Property. Licensee agrees to
cooperate fully and in good faith with Midas for the purpose of securing and
preserving Midas' rights in and to the Intellectual Property.
Notices: All notices, requests, approvals, disapprovals, consents and
statements and all payments made hereunder shall be given or made at the
respective addresses of Midas and Licensee set forth on Exhibit A unless
notification of a change of address is given in writing.
No Assignment: This Agreement and any rights granted herein shall not be
assigned by Licensee without written consent of Midas, except that no consent
will be required if the assignment is to a majority owned subsidiary company.
Governing Law and Forum: This Agreement, including all matters relating to
the validity, construction, performance and enforcement thereof shall be
governed by United States law. The only proper forums for the resolution of
disputes arising under this Agreement shall be Chicago, Illinois, USA and Milan,
Italy.
This Agreement is entered into as of October 30, 1998.
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Midas International Corporation Magneti Xxxxxxxx S.p.A.
By: /s/ Xxxxxx X. Province By: /s/ Xxxxxxxx Xxxxxxx
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Xxxxxx X. Province Xxxxxxxx Xxxxxxx
Chairman and Chief President and Chief
Executive Officer Executive Officer
Witness: /s/ Witness: /s/
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EXHIBIT A
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Midas Svstem means Midas' unique system for the establishment, management
and operation of automotive specialty shops known as "Midas Shops", which engage
in the sale and installation of products and services in the automotive
aftermarket repair and service industry. The Midas System includes proprietary
know-how relating to site selection, shop construction and layout, equipment
selection and installation, purchasing and inventory control methods, accounting
methods, merchandising, advertising, sales, and promotional techniques,
installation techniques, personnel training, and other matters relating to the
efficient and successful operation of said Midas Shops and the maintenance of
high standards of quality.
Licensed Marks means all presently registered trademarks and service marks,
together with any trademarks or service marks which may be registered by Midas
in the future, in the Territory.
Territory shall mean the countries of Italy, Spain, Brazil, Portugal,
Austria, Poland, Switzerland, France, Belgium, and Monaco.
Gross Revenue means the total retail sales derived from the operation of a
shop(s) using the Intellectual Property, whether the sales are for cash or
credit, and irrespective of collection, including sales of both merchandise and
services, less any bona fide consumer refunds, rebates and discounts.
Royalty Schedule means 2.5% of Gross Revenue for the first 6 years
beginning on the date of signing of this agreement; 2% of Gross Revenue for the
following 4 years; and 1.25% of Gross Revenue for the remainder of the term.
Addresses of the Parties:
As to Midas: MIDAS INTERNATIONAL CORPORATION
000 XXXXX XXXXXXXX XXXXXX
XXXXXXX, XXXXXXXX 00000
Fax: (000)000-0000
As to Licensee: MAGNETI MARELLI S.p.A.
Xxxxx Xxxx Xxxxxxxx 00/00
00000 Xxxxxxxx (Xxxxxx) - Xxxxxx
Fax: (00)000.00000
Attn: Chief Executive Officer
Copy to: General Counsel
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