LICENSE AGREEMENT
Exhibit
10.1
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BETWEEN:
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MARIZ
GESTAO E INVESTIMENTOS LIMITADA, a Madeira corporation duly
incorporated according to law, having its registered office at
Xxx xxx Xxxxxx, Xx. 00-0x, 0000 Xxxxxxx, Xxxxxxx, Xxxxxxxx,
(the
"Licensor")
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PARTY
OF THE FIRST PART
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AND:
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SCHIFF
NUTRITION GROUP, INC., a corporation duly incorporated in
accordance with the laws of the State of Utah, herein acting and
represented by Xxxxxx X. Xxxx, its Chief Financial Officer,
(the
“Licensee”)
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PARTY
OF THE SECOND PART
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1.
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RECITALS
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1.1 WHEREAS
Licensor is the beneficial owner of the registrations of the Trademarks (as
hereinafter defined) in Japan;
1.2 WHEREAS
Licensor has licensed to a company (the “Mariz Licensee”) the
right to use, and sublicense the use of, the Trademarks in Japan;
1.3 WHEREAS
the Mariz Licensee has granted an exclusive sublicense to JWO Corp. (JWO Corp.,
together with its Affiliates, being hereinafter collectively referred to as
“JWO”) to use the Trademarks, pursuant to which and until the
termination of which JWO holds the registered title in and to the registrations
of the Trademarks in Japan;
1.4 WHEREAS
Licensee wishes to obtain a license from Licensor to use the Trademarks
in connection with the sale of its joint care products in Costco Stores situated
in Japan;
1.5 WHEREAS
Licensor has approached and obtained from the Mariz Licensee a
retrocession of the Mariz Licensee’s exclusive rights (the “Mariz
Licensee Retrocession”), and the Mariz Licensee has obtained from JWO a
retrocession of JWO’s exclusive rights (the “JWO Retrocession”,
and together with the Mariz Licensee Retrocession, the
“Retrocessions”), but in each case only as necessary to permit
Licensor to grant to Licensee the express licenses contemplated by this
Agreement, and under the express condition that the products in association
with
which the Trademarks are used, and all packaging, materials, invoices, or
advertising or promotions relating thereto, contain no Weider Designation (as
defined below).
NOW,
THEREFORE, THE PARTIES HERETO AGREE AS FOLLOWS:
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2.
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DEFINITIONS
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2.1 In
this
Agreement:
2.1.1 "Affiliate"
means, with regard to any Person mentioned herein, any other Person that
directly or indirectly controls, is controlled by, or is under common control
with such Person mentioned herein. "Control" of any Person means
possession, directly or indirectly, of the power to direct or cause the
direction of management or policies of such Person, whether through ownership
of
voting securities, by contract or otherwise;
2.1.2 "Contract
Year" means any period of four (4) consecutive complete fiscal quarters
of Licensee, during the Term of this Agreement, which: (i) commences on the
first day of the first complete fiscal quarter of Licensee that immediately
follows the Product Launch Quarter, or any anniversary thereof (each, a
“Commencement Date”) and (ii) terminates on the last day of the
fourth (4th) fiscal quarter of Licensee immediately following such Commencement
Date (each, an “End Date”), as well as the First Contract Year
unless the context requires otherwise;
2.1.3
"Costco
Japan" means Costco Wholesale Corporation (or any subsidiary or
division thereof) operating in the Territory or any successor in interest
thereto pursuant to a change of ownership or control, including a sale of
substantially all of its assets;
2.1.4
"Costco
Private Label Products" has the meaning ascribed thereto in Section
X3.6X
hereof;
2.1.5
"Costco
Stores" means the membership warehouse club stores operated by Costco
Japan and the related website, xxx.xxxxxx.xx.xx, xxx.xxxxxx.xx.xx/xxx and
any successor websites, maintained by Costco Japan;
2.1.6 "First
Contract Year" means the period of time commencing on the date of
execution hereof by both parties hereto and terminating on the last day of
the
fourth (4th) complete fiscal quarter of Licensee following the Product Launch
Quarter;
2.1.7 "Initial
Term" means the period of time from the date of execution hereof by
both parties hereto until the End Date of the third (3rd) Contract
Year;
2.1.8 "Licensed
Products" means Products marketed, distributed or sold by Licensee in
the Territory bearing the Trademarks;
2.1.9 "Net
Revenue" means the aggregate of the amounts actually paid by Costco
Japan to Licensee for Licensed Products and Costco Private Label Products sold
by or on behalf of Licensee to Costco Japan, less: (i) any returns received
by
Licensee or refunds or post-payment credits or rebates given to, or other
post-payment account adjustments made in favour of, Costco Japan in connection
with Licensed Products and Costco Private Label Products that were previously
sold by Licensee to Costco Japan, but solely to the extent of the amount
actually previously paid by Costco Japan to Licensee for any Licensed Product
or
Costco Private Label Product that was returned or for which such refund or
post-payment credit, rebate or other account adjustment was made; and (ii)
sums
collected by Licensee for any duly constituted governmental authority and paid
out to such authority on account of any direct tax or, to the extent not
reimbursed to Licensee by Costco Japan, duty imposed by such authority upon
the
sale of Licensed Products and Costco Private Label Products;
2.1.10
"Person"
means any natural or legal person, partnership, joint venture, association,
company, corporation, limited liability company, trust, bank, trust company
or
other organization, whether or not a legal person or entity, and any government
or agency or political subdivision thereof;
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2.1.11
"Products"
means joint care products for human consumption, in liquid, powder, capsule,
tablet or gelcap form;
2.1.12
"Product
Launch Date" means the earlier of (i) the date on which Licensee and/or
Costco Japan commences advertising and promoting the Licensed Products for
sale
at Costco Stores in the Territory and (ii) the date on which Licensee commences
shipping the Licensed Products to Costco Japan;
2.1.13
"Product
Launch Quarter" means the fiscal quarter of Licensee in which the
Product Launch Date occurs;
2.1.14
"Term"
means the Initial Term and any renewal thereof pursuant to Section X10X
hereof;
2.1.15
"Territory"
means the country of Japan;
2.1.16
"Trademarks"
means the trademarks set forth in Schedule "A" annexed hereto, incorporated
herein by reference and forming an integral part hereof;
2.1.17
"Use",
"Used", "Uses" and "Using"
means (i) the marketing, distribution or sale of Products bearing the
Trademarks, (ii) the placement of the Trademarks on the Licensed Products or
their packaging, (iii) the use of the Trademarks in the broadest sense of
publication, that is any visual or aural form to which the average person would
indicate that the Licensed Products are associated with the Trademarks
including, without limitation, advertising, promotion, print media, labels,
point of sale and showroom displays, signs, packaging, stationery, business
cards and forms, and electronic media of any nature and (iv) any other use
of
the Trademarks approved by Licensor in writing prior to such use;
and
2.1.18
"Weider
Designation" means the word “Weider”, any combination of words that
contain the word “Weider” and any derivative word, whether as a name, trademark,
trade name or otherwise, or any other trademark, symbol or logo, present or
future, that includes the name or trademark “Weider”.
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3.
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GRANT
OF LICENSE
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3.1 Subject
to the
terms and conditions hereof, Licensor hereby grants to Licensee, the latter
hereby accepting, the non-exclusive, non-transferable right and license to
Use
the Trademarks in the Territory, and to sublicense to Costco Japan the
non-exclusive, non-transferable right and license to Use the Trademarks, jointly
with Licensee but not separately, in the Territory, in each case solely in
connection with the marketing and advertising of Products in the Territory
and
the distribution and sale of Products solely in Costco Stores in the
Territory. Licensee is expressly prohibited from granting to Costco
Japan the right to sublicense any of the rights and licenses granted to it
hereunder. For greater certainty, Licensee shall be entitled to manufacture,
produce and package the Products with labelling bearing the Trademarks outside
the Territory for distribution and sale to Costco Japan hereunder.
3.2 The
rights and
licenses granted hereunder are subject to the express condition that none of
the
Licensed Products being sold by Licensee to Costco Japan and resold by Costco
Japan in the Costco Stores in the Territory, nor any packaging, materials,
invoices, or advertising or promotion relating thereto, shall contain any Weider
Designation. The breach of this undertaking shall constitute a material
violation of this Agreement and entitle Licensor to immediately terminate this
Agreement as set forth in Section 11.1.3.
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3.3 All
rights and
licenses granted hereunder to Licensee may be exercised and used by any
Affiliate of Licensee for so long as it remains an Affiliate of Licensee (each,
an “Additional Corporation”), provided that: (i) each
Additional Corporation must in advance execute and deliver an undertaking in
favour of Licensor in the form annexed to this Agreement as Schedule “B” (the
“Undertaking”); (ii) Licensee shall remain responsible for the
timely performance by each Additional Corporation of all of the obligations
of
Licensee under this Agreement and all of such Additional Corporation’s
obligations under the Undertaking; and (iii) Licensee shall conscientiously
and
in a timely fashion take all steps necessary or appropriate to ensure that
each
Additional Corporation fulfills all of the obligations of Licensee under this
Agreement and all of its obligations under the Undertaking that it shall have
executed.
3.4 Notwithstanding
the
non-exclusive nature of the rights and license granted to Licensee hereunder,
and provided that Licensee is not in material default hereunder without curing
such default within the applicable cure period, if any, Licensor shall not
market, advertise, distribute or sell Licensed Products anywhere in the
Territory, or grant to any Person the right and license to perform any of the
foregoing activities anywhere in the Territory with the exception of all
existing rights (after giving effect to the Retrocessions) of the Mariz
Licensee, JWO and an existing sublicensee of JWO in respect of the
Trademarks. Licensor represents and warrants that, other than with
respect to the rights granted to Licensee hereunder, it has licensed the
Trademarks solely to the Mariz Licensee, which has sublicensed the Trademarks
solely to JWO, in each case for Use in the Territory. JWO has not
further sublicensed the Trademarks other than the sublicense to Morinaga &
Co., Ltd. of the right to use the “Move Free” Trademark in association with the
“Weider” trademark.
3.5 Licensee
shall not
sell the Licensed Products to any Person other than Costco Japan and shall
cause
Costco Japan to sell all Licensed Products purchased from Licensee solely at
retail at Costco Stores in the Territory.
3.6 Licensee
shall at
all times Use one or more of the “Move Free” Trademarks, with or without one or
more of the “Schiff” Trademarks, in connection with all Products sold to Costco
Japan, and shall require Costco Japan to Use at all times one or more of the
“Move Free” Trademarks, with or without one or more of the “Schiff” Trademarks,
in connection with the marketing, advertising, distribution and sale of Licensed
Products, in each case as the principal trademarks distinguishing the Licensed
Products, and for no other purpose. Notwithstanding any provision of this
Agreement, Licensee shall be entitled to manufacture for and distribute and
sell
the Products to Costco Japan under a private label brand of Costco Japan or
any
of its Affiliates, and payments by Costco Japan to Licensee for the purchase
thereof shall form part of Net Revenue to the extent that such private label
products contain any proprietary elements (i.e. any intellectual property)
of
Licensee (the “Costco Private Label Products”).
3.7 Licensee
agrees not
to approach, contact or otherwise communicate with, or attempt to approach,
contact or otherwise communicate with, any of JWO or any sublicensee of JWO
in
respect of the Trademarks or any of their respective directors, officers,
employees or representatives with respect to any matter contemplated by this
Agreement or relating in any manner to the retrocession of the rights to Use
the
Trademarks pursuant to the JWO Retrocession or to any of the Trademarks or
any
application therefor or registration thereof, any Products or any Licensed
Products, Licensee hereby acknowledging that such approach, contact or other
communication is to be made solely through Licensor.
3.8 Licensor
hereby
reserves all rights not expressly granted to Licensee hereunder.
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4.
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CONSIDERATION
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4.1 As
consideration
for the entering into of this Agreement by Licensor and for the rights and
licenses granted herein, Licensee undertakes to pay to Licensor, in the manner
hereinafter set forth in this Section X4X
and at
such place as Licensor may from time to time designate in writing, the following
royalties (collectively, the "Royalties"):
4.1.1 non-refundable
guaranteed minimum royalties (the "Guaranteed Minimum
Royalties") in respect of each Contract Year in the amount set forth
opposite such Contract Year in the following table:
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Contract
Year
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Guaranteed
Minimum Royalties
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First
Contract Year
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$
100,000
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Second
Contract Year
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$
100,000
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Third
Contract Year
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$
100,000
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Fourth
Contract Year
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$
175,000
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Fifth
Contract Year
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$
175,000
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Sixth
Contract Year
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$
175,000
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Seventh
Contract Year
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$
225,000
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Eighth
Contract Year
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$
225,000
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Ninth
Contract Year
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$
225,000
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The
Guaranteed
Minimum Royalties in respect of each Contract Year shall be payable as
follows: On the Product Launch Date and on the first business day of
each complete fiscal quarter of Licensee following the First Royalty Quarter
(each, a "Royalty Quarter", and the period from the Product
Launch Date to the last day of the first complete fiscal quarter of Licensee
thereafter being referred to as the “First Royalty Quarter”),
Licensee shall pay to Licensor twenty-five percent (25%) of the Guaranteed
Minimum Royalties for such Contract Year. Licensee acknowledges that,
in each of the first three (3) Contract Years, Licensor has declared having
contractually agreed to remit the entire amount of the Guaranteed Minimum
Royalties to JWO in consideration of the JWO Retrocession;
AND
4.1.2 a
continuing and
non-refundable royalty fee (the "Percentage Royalties") in
respect of each Contract Year equal to five percent (5%) of Net Revenue, payable
as follows: Within ninety (90) days following the end of:
4.1.2.1 the
First Royalty
Quarter, Licensee shall pay to Licensor the Percentage Royalties based on Net
Revenue in respect of the period from the Product Launch Date to the end of
the
First Royalty Quarter, less all amounts actually paid by Licensee to Licensor
on
account of Guaranteed Minimum Royalties for that same period; and
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4.1.2.2 each
subsequent
Royalty Quarter of any Contract Year, Licensee shall pay to Licensor the
Percentage Royalties based on the cumulative Net Revenue in respect of such
Contract Year, less the cumulative amounts actually paid by Licensee to Licensor
on account of Royalties in respect of such Contract Year.
4.2 Notwithstanding
the
provisions of Sections X4.1.1X
and
X4.1.2X
hereof,
at such time during each Contract Year as Licensee shall have paid Royalties
relating to such Contract Year in an amount equal to the Guaranteed Minimum
Royalties applicable for such Contract Year, Licensee shall thereafter only
pay
Percentage Royalties, if any, for the remainder of such Contract Year. Further,
notwithstanding the provisions of Section X4.1X
hereof,
the Percentage Royalties paid by Licensee to Licensor with regard to any
Contract Year shall not be applied towards or otherwise reduce the amount of
Guaranteed Minimum Royalties due and payable by Licensee to Licensor with regard
to any other Contract Year, it being the parties intent that each Contract
Year
shall be treated separately for purposes of determining the Royalties due and
payable from Licensee to Licensor.
4.3 Within
ninety (90) days following the end of the First Royalty Quarter and each Royalty
Quarter during the term of this Agreement, Licensee shall furnish Licensor
with
a written statement for such First Royalty Quarter and Royalty Quarter,
respectively, certified by the Controller or Chief Financial Officer of
Licensee, disclosing total sales of Licensed Products and Costco Private Label
Products to Costco Japan during such First Royalty Quarter and Royalty Quarter,
respectively, and containing the unit sales per type of Licensed Product, Costco
Private Label Product or SKU thereof, the gross invoice price of all sales
of
Licensed Products and Costco Private Label Products for such First Royalty
Quarter and Royalty Quarter, respectively, all deductions applicable to such
gross invoice price, the Net Revenue during such First
Royalty Quarter and Royalty Quarter, respectively, as well as all other
information relating to the calculation of Percentage Royalties or the unit
sales per type of Licensed Product, Costco Private Label Product or SKU thereof
reasonably requested by Licensor. Concurrently with the delivery of
each such statement, Licensee shall pay to Licensor the Percentage Royalties
payable for such First Royalty Quarter and Royalty Quarter, respectively,
pursuant to Section X4.1.2X
hereof.
4.4 The
parties agree that, other than as expressly provided in Sections 2.1.8, X4.1X,
4.2,
4.4 and 4.7 of this Agreement, the calculation and payment of Royalties shall
not be subject to any setoff, compensation or other deduction of any nature
whatsoever. Notwithstanding the foregoing, Licensee shall promptly advise
Licensor in writing if it has received written advice from its counsel or
accountants that, as a result of a change in applicable law or application
of
applicable law, Licensee is legally required to withhold and remit to the
appropriate fiscal authority in the Territory any amount on account of a
withholding tax in respect of any payment due to Licensor
hereunder. To the extent that Licensee effects the withholding and
remittance of any amount on account of a withholding tax in accordance with
the
foregoing, Licensee shall contemporaneously with any payment of Royalties,
or as
soon thereafter as the appropriate fiscal authority in the Territory makes
the
necessary documents available, provide to Licensor all withholding tax receipts
or other similar official government certifications evidencing all taxes
withheld from payments due under this Agreement and the proper and timely
remittance of those taxes to the government in the name of
Licensor.
4.5 All
monetary amounts stated herein refer to the lawful currency of the United States
of America and all payments to Licensor hereunder shall be made in currency
of
the United States of America.
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4.6 All
amounts which become due to Licensor pursuant to the terms hereof shall bear
interest from their respective due dates at an annual rate of interest equal
to
the lesser of: (i) three percent (3%) over the “prime rate” charged in New York
City by Citibank N.A. or its successor, as published in the Wall Street Journal
(Eastern Edition) on the date any such payment was due, and (ii) the maximum
interest rate permitted by law; the whole without prejudice to Licensor's other
rights hereunder or at law or in equity.
4.7 Licensee
shall maintain separate and appropriate books and accounts and computer records
relating to the Licensed Products and the Costco Private Label Products sold
to
Costco Japan in accordance with generally accepted accounting principles and
shall make accurate entries concerning all transactions relevant to this
Agreement. Subject to ten (10) business days’ prior notice and
at a reasonable time during the business day, such books, accounts and computer
records shall be made available to Licensor throughout the Term of this
Agreement and for a period of one year thereafter (or in the event of a dispute
between the parties hereto, until one year after said dispute is resolved,
whichever is later) for inspection and/ or audit by any duly authorized
representatives of Licensor at Licensor’s sole expense (such inspection or audit
shall be limited to once in each Contract Year or such one year
periods). Licensee shall have the right to object to the results of
any such inspection and/or audit, in which case Licensee and Licensor shall
negotiate in good faith to resolve the matter and, if unresolved after ten
(10)
business days, either party may refer the matter to a mutually agreed upon
independent auditing firm not used by either of Licensee or Licensor for
resolution of the matter within the following twenty (20) business days; the
decision of such firm shall be final and binding upon all
parties. Whenever any such inspection and/or audit of a Contract Year
discloses an understatement in excess of five percent (5%) of the payments
due
by Licensee hereunder for such Contract Year, all reasonable third party
expenses in connection with such inspection and/or audit shall be paid by
Licensee to Licensor within thirty (30) business days following final resolution
of the matter and receipt of written documentation regarding the
expenses. In addition: (i) in the event any such inspection and/or
audit discloses any understatement of payments owing by Licensee hereunder,
Licensee shall within thirty (30) business days following final resolution
of
the matter pay to Licensor all amounts due and unpaid hereunder, together with
interest thereon at the rate set forth in Section 4.6 hereof, without prejudice
to Licensor's rights hereunder or at law; and (ii) in the event any such
inspection and/or audit discloses any overstatement of payments owing by
Licensee hereunder Licensor shall credit any such overstatement against the
immediately following payments of Royalties due by Licensee hereunder, without
prejudice to Licensee’s rights hereunder or at law.
4.8 Licensor's
receipt of any statement furnished pursuant hereto or its acceptance of any
sum
paid hereunder shall not constitute a waiver of Licensee's obligations or
Licensor's rights hereunder or at law or in equity.
4.9 Any
and all information provided by Licensee or its representatives pursuant to
this
Section 4 shall be and remain strictly confidential and shall not be disclosed
by Licensor to any other Person: provided, however, that Licensor shall be
permitted to disclose such information to the Mariz Licensee, to JWO and to
the
legal, financial and tax advisors of each of Licensor, the Mariz Licensee and
JWO, but then only to the extent required for the purposes of this Agreement,
including, without limitation, as to the amount of Royalties owed hereunder
and
only if the Mariz Licensee, JWO and such legal, financial and tax advisors
agree
to keep such information strictly confidential and not to disclose such
information to any other Person. None of Licensor, the Mariz
Licensee, JWO or such legal, financial or tax advisors of each of them shall
use
such information for any purpose not relating to this Agreement or the
Retrocessions. Licensor represents that the Mariz Licensee
Retrocession and the JWO Retrocession contain obligations imposed on the Mariz
Licensee and JWO, respectively, that are commensurate with the obligations
of
Licensor under this Section 4.9. Notwithstanding the foregoing,
Licensor, the Mariz Licensee, JWO and such legal, financial and tax advisors
shall be permitted to disclose such information if required, in the opinion
of
legal counsel, to do so by subpoena or by other legal or administrative
process. If so required, Licensor, the Mariz Licensee, JWO or such
legal, financial or tax advisors, as the case may be, shall promptly notify
Licensee of such requirement and, if possible under the circumstances, shall
notify Licensee prior to any such disclosure.
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5.
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ADVERTISING
AND MARKETING
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5.1 Licensee
shall
ensure that all advertising and promotional material relating to the Licensed
Products sold to Costco Japan to be resold in the Costco Stores in the Territory
is of the same standards, prestige and overall quality as the advertising and
promotional material used by Licensee in connection with the sale of Products
in
the United States of America, subject to such differences as are commercially
reasonable given the differences between the markets. Upon reasonable
request by Licensor, Licensee shall provide to Licensor for inspection the
advertising and promotional material relating to the Licensed Products sold
to
Costco Japan to be resold in the Costco Stores in the Territory including,
without limitation, the catalogues, packaging, labelling, circulars and other
material bearing the Trademarks.
5.2 Licensee
shall not,
and Licensee shall use its best efforts to ensure that Costco Japan does not,
advertise or promote the Licensed Products and the Trademarks in the Territory
in a manner that shall denigrate the goodwill and reputation
thereof. Licensee shall not, and Licensee shall use its best efforts
to ensure that Costco Japan does not, conduct any advertising or promotion
of
the Licensed Products which is deceptive or otherwise misleading under
applicable laws in the Territory. Licensee represents to Licensor
that Licensee and Costco Japan currently anticipate in-store advertising and
promotion at Costco Stores in the Territory, as well as in Costco Japan
newsletters, with potential coupon and similar trade promotions.
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6.
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TRADEMARKS
AND INFRINGEMENT
THEREOF
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6.1 This
Agreement does
not constitute a grant to Licensee of any rights, title or interest in or to
the
Trademarks or any application therefor or registration thereof, other than
the
limited right to Use the Trademarks in the manner expressly set forth in this
Agreement. Licensee agrees not to assert the invalidity or contest the ownership
of the Trademarks, any application therefor or registration thereof at any
time
during the Term or after the expiration of the Term or termination of this
Agreement for any reason whatsoever.
6.2 Licensee
shall Use,
and shall use its best efforts to ensure that Costco Japan Uses, the Trademarks
strictly in accordance with the terms hereof and only as consistent with their
respective registrations or applications for registration or as currently
depicted on Licensee’s Product labels and advertising. Licensee shall
not Use, nor shall it permit Costco Japan to Use, any of the Trademarks in
a
manner that would impair the validity of JWO’s registered title, or Licensor’s
beneficial title, to any application or registration of the Trademarks and,
without limiting the generality of Section 6.1 hereof in any manner, shall
otherwise refrain from taking action which would invalidate the Trademarks
(or
any application therefor or registration thereof) in the Territory at any time
during the Term, and from taking any legal, administrative or regulatory actions
or proceedings of any nature for the purpose of invalidating the Trademarks
(or
any application therefor or registration thereof) in the Territory or of
challenging the ownership of the Trademarks (or any application therefor or
registration thereof) in the Territory, during the Term or after the expiration
of the Term or termination of this Agreement for any reason
whatsoever.
6.3 At
Licensor's
request and expense, Licensee shall execute and deliver such documents,
applications and other writings and do such things as may be reasonably
requested by Licensor in order to maintain the validity of the Trademarks and
obtain, maintain or renew any registration thereof. Licensor shall,
at its sole expense, take all actions that a prudent trademark owner in the
Territory would consider necessary or advisable to take, in order to maintain
the applications and registrations for the Trademarks set forth in Schedule
A
hereto. Licensor shall, at its sole expense, take all actions that a
prudent trademark owner in the Territory would consider necessary or advisable
to take, after consideration of all reasonable legal and commercial
ramifications of such actions (including, without limitation, opinions from
its
legal counsel with respect to same), in order to protect the ownership, validity
or distinctiveness of the Trademarks, and any of the applications therefor
or
registrations thereof, against infringement or third party challenges that
could
reasonably be expected, if left uncontested or unchallenged, to impair,
commercially or otherwise, or negatively impact the right and ability of
Licensee to Use the Trademarks in the Territory, including, without limitation,
all filings, prosecution of infringement actions and defending against
challenges before the courts or in the Japanese Trademark
Office. Failure to comply with the foregoing obligations by Licensor
shall not constitute a breach of the terms hereof by Licensor but shall
nevertheless entitle Licensee to terminate this Agreement in the circumstances
contemplated by Section X11.2.1X
hereof
without any claim for damages against Licensor, except in the event of
Licensor’s breach of any of its representations or warranties contained
herein. Licensee shall use all commercially reasonable efforts to
cooperate with Licensor, the Mariz Licensee and/or JWO and their respective
representatives, at Licensor’s cost and expense, in the prosecution of each
application for registration of the Trademarks which any of them has filed
or
may file anywhere in the Territory. None of the foregoing provisions of this
Section 6.3 shall limit in any manner the indemnification of Licensor in
connection with the Trademarks pursuant to Section 9.3 hereof.
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6.4 [Reserved.]
6.5 Whenever
Licensee
has actual knowledge of any infringement or threatened infringement of any
of
the Trademarks or any third party claim that any of the Trademarks causes
deception or confusion with or infringes upon such third party’s trademarks,
service marks or other proprietary rights in any manner (other than any
permitted use by JWO’s sublicensee pursuant to arrangements referenced in
Section 3.4 hereof), Licensee shall promptly give notice thereof to Licensor
and
provide Licensor with all information it acquires with respect
thereto. Subject to Section X6.3X
hereof,
Licensor shall institute or defend proceedings, as the case may be, at its
own
expense with regard to each of the foregoing matters. Licensee shall
not institute any proceedings relating to the Trademarks, or any application
or
registration thereof, without the prior written consent of
Licensor. In the event that Licensor undertakes the defence or
prosecution of any such proceedings, Licensee agrees to execute and deliver
such
documents and do such things, including without limitation being made a party
to
such proceedings, at Licensor's expense, as may be deemed reasonably necessary
or advisable by counsel for Licensor. Licensor shall use its
reasonable commercial efforts, as any prudent trademark owner in the Territory
would consider necessary or advisable to take, after consideration of all
reasonable legal and commercial ramifications of such efforts (including,
without limitation, opinions from its legal counsel with respect to same),
to
procure the right for Licensee to continue to Use the Trademarks as contemplated
in this Agreement at Licensor’s sole expense. However, in the event
that, as a result thereof, Licensee is prevented from Using any of the
Trademarks in accordance with the terms hereof, Licensee may terminate this
Agreement pursuant to Section X11.2.1X
hereof
without any claim for damages against Licensor, except in the event of
Licensor’s breach of any of its representations, warranties or covenants
contained herein, and shall be relieved from its obligations to pay Royalties
after such termination. None of the foregoing provisions of this
Section 6.5 shall limit in any manner the indemnification of Licensor in
connection with the Trademarks pursuant to Section 9.3 hereof.
6.6 Licensee
acknowledges and agrees that all goodwill associated with the Trademarks shall
inure directly and exclusively to the benefit of and belong to the owner of
the
Trademarks. Without in any way limiting the generality of the
foregoing, no monetary amount shall be payable for or attributable to any loss
of clientele, business or goodwill relating to Use of the Trademarks upon
termination or expiration of the Term of this Agreement. Nothing
contained in this Section 6.6 shall be interpreted so as to require Licensee
to
treat or account for this Agreement in any particular manner for Licensee’s
accounting or tax purposes.
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7.
|
QUALITY
CONTROL
|
7.1 Licensee
acknowledges that the continued maintenance of the value of the Trademarks
and
their associated goodwill, and the continued maintenance of Licensor's quality
standards associated with the Trademarks are essential elements of the rights
and license granted hereunder. Licensee agrees that the nature and quality
of
all Uses of the Trademarks by Licensee shall be consistent with the reasonable
standards set by Licensor (and provided in writing to Licensee) on its own
behalf as beneficial owner of, and on behalf of the registered owner of, the
registrations of the Trademarks. Licensee shall maintain appropriate
quality standards and programs in the manufacture and production of Licensed
Products by or on behalf of Licensee for sale to Costco Japan, including
appropriate good manufacturing practices commensurate with those used in
connection with Products sold by or on behalf of Licensee in the United States
of America (the “Standards”).
7.2 Upon
reasonable
request, Licensee agrees to cooperate with Licensor in confirming the compliance
of the Licensed Products with the Standards, including permitting reasonable,
periodic inspection of Licensee's operations not more often than once in each
Contract Year, at reasonable times during the business day and with at least
ten
(10) business days’ prior notice, and to supply Licensor with specimens of all
Uses of the Trademarks as set forth in this Agreement, as well as written
certificates of compliance with respect to any third party plants, factories
or
other production, bottling or packaging facilities used by Licensee to produce,
manufacture or package the Licensed Products, upon the reasonable request of
Licensor. In the event that the Licensed Products or components
thereof are manufactured or produced by any Person other than Licensee, Licensee
shall at all times ensure compliance with this Section X7X
by such
Person.
7.3 Upon
reasonable
written request by Licensor from time to time, and solely in order for Licensor
to determine and assure itself that Licensee is maintaining the Standards in
manufacturing the Licensed Products, Licensee shall submit to Licensor, without
charge, a sample of each type of Licensed Product manufactured by or on behalf
of Licensee. If at any time, Licensor reasonably determines that the
sample of a Licensed Product does not meet the Standards, Licensee shall
promptly take all necessary steps to ensure that the Standards are met in the
manufacturing of Licensed Products and shall provide a sample from a new
production run to demonstrate that the quality has improved to the reasonable
satisfaction of Licensor.
7.4 Licensee
acknowledges and agrees that although Licensor may upon reasonable written
request conduct reviews of the Licensed Products produced by or on behalf of
Licensee under this Agreement and the related advertising and promotional
materials and samples, and may make various recommendations to Licensee,
Licensor shall have no responsibility or liability for the operation of
Licensee’s business or its facilities used in connection therewith, or its
production, manufacture, marketing, distribution or sales, other than with
respect to (and solely in connection with) written instructions provided by
Licensor to Licensee regarding the manner in which to Use the Trademarks.
Licensor’s review of (and acquiescence to, if any) any samples, advertising or
promotional materials, artwork or the Licensed Products shall not be construed
to mean that same conform to the laws, rules and regulations of any
jurisdiction, other than the fact that the registrations of the Trademarks
have
been obtained and maintained in accordance with applicable laws in the
Territory; without limiting the generality of the foregoing, Licensor shall
not
bear any liability or responsibility of any nature whatsoever for such reviews
(and acquiescence, if any). None of the foregoing provisions of this Section
X7.4X
shall
limit in any manner the indemnification obligations of the Licensor in
connection with the Trademarks pursuant to Section X9.3X
hereof.
7.5 Licensee
shall
ensure that all Licensed Products are processed, bottled, packaged,
manufactured, marketed, advertised, distributed and sold in material compliance
with all applicable laws, rules and regulations in the
Territory. Licensee shall affix truthful labelling upon all Licensed
Product packaging, along with any disclosures required by applicable law or
Trademark ownership notices reasonably required by Licensor, which shall be
provided in writing to Licensee by Licensor. Licensee shall promptly inform
Licensor in writing of any material complaint by any consumer or government
body
in the Territory relevant to the Licensed Products, as well as to the status
and
resolution thereof. Licensor shall act expeditiously to resolve any
such complaint solely to the extent same relates to the ownership or
registration of the Trademarks or the manner in which the Trademarks are Used
and such manner of Use is set forth in written instructions provided by Licensor
to Licensee. Licensee shall act expeditiously to resolve any such
complaint otherwise involving the Licensed Products. None of the foregoing
provisions of this Section X7.5X
shall
limit in any manner the indemnification obligations of the Licensor in
connection with the Trademarks pursuant to Section X9.3X
hereof.
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8.
|
REPRESENTATIONS
AND WARRANTIES
|
8.1 Licensor
hereby
represents to Licensee that: (i) it has not granted any right or license to
any
Person (other than the Mariz Licensee, JWO and its existing sublicensee pursuant
to arrangements referenced in Section 3.4 hereof) to use any of the Trademarks,
or any of the applications therefor or registrations thereof, in connection
with
marketing, advertising, distribution and sale of Products within the Territory;
(ii) there are no lawsuits, pending or threatened, relating to the Trademarks,
or any of the applications therefor or registrations thereof, anywhere in the
Territory and, to the best of Licensor's knowledge, there are no claims or
demands of whatsoever nature with respect to or in any manner affecting the
Trademarks; (iii) the registrations of the Trademarks set forth on Schedule
“A”
hereto are all of the “Schiff” and/or “Move Free” trademarks registered in the
Territory and are registered in the classes necessary for Schiff to sell the
Licensed Products into the Territory as an over the counter dietary supplement;
(iv) to the best of Licensor’s knowledge, after such reasonable inquiry that a
prudent trademark owner in the Territory would consider necessary, the
Trademarks do not infringe on any rights of any Person when Used in connection
with the Licensed Products in the Territory; (v) none of Licensor, the Mariz
Licensee, JWO nor any of their respective Affiliates or sublicensees has
licensed the Trademarks, or any of the applications therefor or registrations
thereof, or any aspect thereof in any manner inconsistent with the rights and
licenses granted hereunder, except pursuant to arrangements referenced in
Section 3.4 hereof; (vi) JWO is the registered owner, and Licensor is the
beneficial owner, of the registrations of the Trademarks in the Territory;
(vii)
Licensor has full power, capacity, right and authorization to enter into this
Agreement, is entitled to grant the rights and licenses contemplated by this
Agreement and no violation of law or contract to which Licensor is party will
result therefrom; and (viii) the Retrocessions are in full force and effect,
enforceable, and cannot be terminated except upon the same terms as this
Agreement.
8.2 All
product
approvals and registrations for the Licensed Products and the Costco Private
Label Products in the Territory shall be the responsibility, and at the cost
and
expense, of Licensee, in the name of Licensee or its designee and Licensee
shall
be the sole owner thereof. Licensor shall comply with all reasonable
requests, including for the provision of documentation, and otherwise cooperate
with Licensee in obtaining such approvals and registrations.
8.3 Notwithstanding
anything contained in any other Section of this Agreement: (i) under no
circumstances shall any of Licensor, Licensee or JWO or their respective
Affiliates be liable to any of the others of Licensor, Licensee or JWO or their
respective Affiliates for any indirect, special, punitive, consequential or
incidental damages of any kind whatsoever (including, without limitation, lost
or anticipated revenues or profits) arising from any claim relating to this
Agreement, whether such claim is based on contract, warranty or tort, even
if an
authorized representative is advised of the likelihood or possibility of same;
and (ii) but subject to Section X12.4X
hereof,
in no event shall any of Licensor, Licensee or JWO or their respective
Affiliates be liable to any of the others of Licensor, Licensee or JWO or their
respective Affiliates for any direct damages or claims in excess of the amount
of the Guaranteed Minimum Royalties for the Contract Year in which such claim
arose. None of the foregoing provisions of this Section 8.3 shall
limit in any manner the indemnification under this Agreement in connection
with
claims by third parties other than Licensor, the Mariz Licensee, JWO, Licensee
and their respective Affiliates.
8.4 Licensee
hereby
represents to Licensor that Licensee has full power, capacity, right and
authorization to enter into this Agreement, is entitled to accept the rights
and
licenses contemplated by this Agreement and no violation of law or contract
to
which Licensee is party will result therefrom.
|
9.
|
INSURANCE
AND INDEMNIFICATION
|
9.1 Throughout
the term
of this Agreement and for a period of three (3) years thereafter Licensee shall
maintain product liability insurance against claims for product liability
related to the sale or use of the Licensed Products in an amount at least equal
to two million dollars ($2,000,000) per occurrence. Such insurance
shall be written with a reputable insurer. Licensor and JWO
Corp.shall be named as additional insureds under each such policy of
insurance. That coverage shall not be materially reduced or cancelled
without thirty (30) days prior written notice having been provided to
Licensor. Compliance with the provisions of this Section X9.1X
shall
not limit in any manner the indemnification obligations under this
Agreement.
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9.2 Licensee
shall
indemnify and save and hold Licensor, JWO, their respective Affiliates and
their
respective directors, officers, employees and agents (collectively, the
“Mariz Indemnified Parties”) harmless from and
against any debts, liabilities, claims, damages, losses, costs and expenses,
including injury or death to persons, damage to property and reasonable
attorneys’ fees and costs (collectively, the "Losses"), which
any of the Mariz Indemnified Parties is or may become liable for or be compelled
to pay arising or resulting in any way from: (i) any act or omission of Licensee
or its directors (other than Xxxxxx Xxxxxxxx), officers, servants, agents or
employees in connection with Licensee's performance under the terms of this
Agreement, including, without limitation, breach of this Agreement by Licensee;
(ii) use, possession or consumption of, or any representation, warranty or
statement in respect of, Licensed Products or Costco Private Label Products
produced, bottled, manufactured, marketed, advertised, distributed and sold
by
or on behalf of Licensee and/or Costco Japan in the Territory (whether or not
any sample thereof may have been approved by Licensor hereunder); (iii) any
claim that Licensed Products or the Costco Private Label Products produced,
bottled, manufactured, marketed, advertised, distributed and sold by or on
behalf of Licensee and/or Costco Japan in the Territory (whether or not any
sample thereof may have been approved by Licensor hereunder) either infringe
upon or otherwise violate the rights of any other Person for any reason or
do
not comply with any applicable law, rule or regulation relating to the
protection of intellectual property (unless the infringement, violation or
non-compliance results from use of the Trademarks in accordance with the
provisions of this Agreement); or (iv) any claim that the Use by Licensee of
trademarks or other intellectual property rights (other than the Trademarks)
in
association with the Licensed Products and the Costco Private Label Products
pursuant to Section X3.6X
hereof
either infringes upon or otherwise violates the rights of any other Person
in
the Territory for any reason; except, in each case, to the extent such Losses
result from the gross negligence, bad faith or intentional misconduct of
Licensor, the Mariz Licensee, JWO or their respective Affiliates, sublicensees,
representatives or agents.
9.3 Licensor
shall
indemnify and save and hold Licensee, its Affiliates and their respective
directors, officers, employees and agents (collectively, the “Schiff
Indemnified Parties” and together with the Mariz
Indemnified Parties, the “Indemnified Parties”) harmless from
and against any Losses, which any of the Schiff Indemnified Parties is or may
become liable for or be compelled to pay arising or resulting in any way from:
(i) any act or omission of Licensor, JWO, the Mariz Licensee, and their
respective Affiliates, or their respective directors, officers, servants,
sublicensees, agents or employees in connection with Licensor's performance
under the terms of this Agreement, including, without limitation, breach of
this
Agreement by Licensor; or (ii) any claim that the Use of the Trademarks in
accordance with the terms of this Agreement either infringes upon or otherwise
violates the rights of any other Person in the Territory for any reason or
does
not comply with any applicable law, rule or regulation relating to the
protection of intellectual property (whether or not the relevant Use of the
Trademark may have been approved by Licensee hereunder); except, in each case,
to the extent such Losses result from the gross negligence, bad faith or
intentional misconduct of Licensee or its affiliates, representatives or agents
(other than Xxxxxx Xxxxxxxx).
9.4 In
the event that a
claim is made against any of the Indemnified Parties for which it is entitled
to
indemnification pursuant to Section X9.2X
or 9.3
hereof, such Indemnified Party agrees to promptly notify the party required
to
provide such indemnification (the “Indemnifying Party”)
thereof. In the case of a claim by a third party against any of the Indemnified
Parties, the Indemnifying Party may, at its option, elect to assume the defence
of such claim, provided that: (i) such Indemnified Party shall be entitled
to
participate therein through counsel of its own choosing, at its own cost and
expense, and (ii) the Indemnifying Party shall not settle or compromise any
such
claim without the prior written consent of such Indemnified Party, unless the
settlement or compromise includes a general release of such Indemnified Party
from any and all liability with respect thereto. Notwithstanding
Section 9.4(i) above, if the Indemnifying Party’s and the Indemnified Party’s
respective interests cannot be fully, ethically and adequately represented
by
common counsel, such Indemnified Party shall be entitled to be represented
by
separate counsel reasonably acceptable to such Indemnified Party, and the
Indemnifying Party shall bear all reasonable fees and costs of such separate
counsel.
9.5 [Reserved.]
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10.
|
TERM
|
10.1 Subject
to the
terms hereof, the Term of this Agreement shall commence upon the date of
execution hereof by both parties and terminate on the End Date of the third
(3rd) Contract Year. Licensee shall have the option to renew the
rights and licenses granted hereunder for further two (2) successive terms
of
three (3) Contract Years each, provided that in each case:
10.1.1
at
the
time of such renewal, there shall not exist a material default by Licensee
in
respect of its obligations hereunder which has not been cured within the cure
period provided therefor, if any;
10.1.2
the
Net Revenue during the third (3rd) Contract Year, as concerns the first renewal
term, shall be at least equal to an amount that has generated the Guaranteed
Minimum Royalties in respect of that Contract Year; and the Net Revenue during
the sixth (6th) Contract Year, as concerns the second renewal term, shall be
at
least equal to an amount that has generated the Guaranteed Minimum Royalties
in
respect of that Contract Year; and
10.1.3
Licensee
shall have
given Licensor written notice of its exercise of its option to renew not less
than ninety (90) days nor more than one hundred and eighty (180) days prior
to
the expiration of the then current Term hereof.
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11.
|
TERMINATION
|
11.1 The
occurrence of
any one or more of the following events shall entitle Licensor to immediately
terminate this Agreement, at its sole discretion and upon written notice to
Licensee:
11.1.1
subject
to the
provisions of Section 4.7 hereof, should Licensee fail to pay when due any
amount owing to Licensor hereunder and fail to remedy such default within
fifteen (15) business days after receipt of written notice thereof from
Licensor;
11.1.2
should
Licensee fail to submit financial information required pursuant to Section
4.3
to Licensor and fail to remedy such default within fifteen (15) business days
after receipt of written notice thereof from Licensor;
11.1.3
should
any Weider Designation be used in connection with the Licensed Products or
any
related materials, advertising or promotion in the Territory contrary to
provisions of Section X3.2X
hereof;
11.1.4
should
the Product Launch Date not occur by the end of the fifteen (15th) calendar
month
following the execution of this Agreement; or
11.1.5
should
Licensee breach any other material provision hereof and fail to remedy same
within thirty (30) days after receipt of written notice thereof from Licensor
containing reasonably sufficient particulars thereof.
11.2 The
occurrence of
any one or more of the following events shall entitle Licensee to immediately
terminate this Agreement, at its sole discretion and upon written notice to
Licensor:
11.2.1
should
Licensor fail to maintain registration of any of the Trademarks in the
Territory, or should Licensee's right and ability to Use the Trademarks be
materially impaired or materially, negatively impacted, commercially or
otherwise;
11.2.2
should
Licensor breach any other material provision hereof and fail to remedy same
within thirty (30) days after receipt of written notice thereof from Licensee
containing reasonably sufficient particulars thereof; or
11.2.3
should
Costco Japan elect to no longer carry the Licensed Products and the Costco
Private Label Products.
11.3 In
addition, a
party may terminate this Agreement immediately, upon written notice, if the
other party makes an assignment for the benefit of its creditors, files a
petition in bankruptcy, is adjudicated insolvent or bankrupt, files a petition
or apply to any tribunal for any receiver, trustee, liquidator or sequestrator
of any substantial portion of its property, commence any proceeding under any
law or statute of any jurisdiction respecting insolvency, bankruptcy,
arrangement or readjustment of debt, dissolution, winding-up, composition or
liquidation, or otherwise takes advantage of any bankruptcy or insolvency
legislation whether now or hereafter in effect, or if any receiver, trustee,
liquidator or sequestrator of any substantial portion of its property is
appointed.
11.4 No
Person acting
for the benefit of the creditors of Licensor or Licensee or any receiver,
trustee, liquidator, sequestrator, trustee in bankruptcy, sheriff, officer
of a
court or Person in possession of Licensor’s or Licensee's assets or business
shall have any right to continue the performance of this Agreement in any
circumstances whatsoever.
11.5 All
rights,
remedies and recourses set forth herein for the benefit of Licensor or Licensee,
as applicable, shall be in addition and without prejudice to all other rights,
remedies and recourses available to such party, except as otherwise set forth
herein.
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|
12.
|
EFFECT
OF TERMINATION OR EXPIRATION OF THE
TERM
|
12.1 Upon
the
termination of this Agreement for any reason whatsoever or the expiration of
the
Term of this Agreement, or upon the expiration of the Winding-Up Period (as
hereinafter defined), if any, the following provisions shall apply:
12.1.1
all
rights of Licensee hereunder and all rights of Costco Japan resulting therefrom,
including without limitation the right and license to Use the Trademarks, shall
cease immediately, and Licensee shall, and shall use its best efforts to cause
Costco Japan to, immediately discontinue all Use of the Trademarks subject
to
Section 12.2; and
12.1.2
all
undisputed amounts owing by Licensee to Licensor shall become due and payable
within ten (10) business days following receipt of written demand from Licensor
therefor.
12.2 In
addition, upon
the expiration of the Term of this Agreement or the termination of this
Agreement for any reason other than pursuant to Section X11.1.5X
(arising
from a breach of any of Sections X6X,
X7X
or X9X
hereof),
X11.1.1X
or X11.1.3X
hereof,
each of Licensee and Costco Japan shall have the right to distribute and sell
its remaining inventory of Licensed Products, on a non-exclusive basis, for
a
period of one hundred eighty (180) days following the date of termination of
this Agreement or the expiration of the
Term (such one hundred eighty (180) day period
being referred to herein as the “Winding-Up Period”) in the
ordinary course of business and in strict accordance with the terms of this
Agreement and the following provisions:
12.2.1
no
later than thirty (30) days prior to the expiration of the Term of this
Agreement or within thirty (30) days after such termination of this Agreement,
Licensee shall deliver to Licensor a complete and detailed statement (the
“Inventory Statement”) setting forth the number and description
of the then remaining inventory of Licensed Products, raw materials therefor,
work in process and labels therefor destined for the Territory that are owned
or
controlled by Licensee, and shall use commercially reasonable best efforts
to
obtain and include such information from Costco Japan (collectively, the
“Remaining Inventory”); and
12.2.2
within
twenty (20) days following the earlier of: (i) the expiration of the Winding-Up
Period, or (ii) the actual liquidation of all Remaining Inventory, Licensee
and
Costco Japan shall cease Using the Trademarks in the Territory.
12.3 Termination
of this
Agreement for any reason whatsoever or the expiration of the Term shall not
release either party from any of its obligations which remain unfulfilled at
such time or release either party from those obligations which survive such
termination or expiration, including without limitation the obligations set
forth in Sections X4X,
X6X,
X9X,
X12X
and
X13X
hereof.
12.4 Notwithstanding
anything in this Agreement to the contrary, upon termination of this
Agreement:
12.4.1
by
Licensee pursuant to Section 11.2.1, 11.2.2 or 11.3 hereof, no additional
Royalties (including Guaranteed Minimum Royalties) shall accrue or be payable
in
respect of any period after the date of such termination;
12.4.2
by
Licensee pursuant to Section 11.2.3 hereof:
12.4.2.1 at
any time prior
to the expiration of the Initial Term, Licensee shall pay to Licensor all unpaid
Guaranteed Minimum Royalties that would have otherwise been payable hereunder
by
Licensee to Licensor for the first three (3) Contract Years as set forth in
Section X4.1.1X
hereof,
or
12.4.2.2 at
any time
thereafter, Licensee shall pay to Licensor the Guaranteed Minimum Royalties
that
would have otherwise been payable hereunder in respect of the four (4) complete
fiscal quarters of Licensee immediately following such termination and shall,
conditional upon such payment, be fully discharged and released for any
additional payment of Guaranteed Minimum Royalties that would have become due
under this Agreement after such termination; or
12.4.3
by
Licensor pursuant to Section 11.1 or 11.3 hereof:
12.4.3.1 at
any time prior
to the expiration of the Initial Term, Licensee shall pay to Licensor all unpaid
Guaranteed Minimum Royalties that would have otherwise been payable hereunder
by
Licensee to Licensor for the first three (3) Contract Years as set forth in
Section X4.1.1X
hereof,
or
12.4.3.2 at
any time
thereafter, Licensee shall pay to Licensor the Guaranteed Minimum Royalties
that
would have otherwise been payable hereunder in respect of the longer of: (i)
the
four (4) complete fiscal quarters of Licensee immediately following such
termination; or (ii) all of the remaining complete fiscal quarters of Licensee
following such termination until the expiration of the then-current Term of
this
Agreement; and Licensee shall, conditional upon such payment, being fully
discharged and released for any additional payment of Guaranteed Minimum
Royalties that would have become due under this Agreement after such
termination.
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13.
|
MISCELLANEOUS
PROVISIONS
|
13.1 The
preamble hereto
shall form an integral part hereof.
13.2 This
is an
agreement between separate entities and neither is the agent or servant of
or
possesses the power to obligate the other. This Agreement shall not
be construed so as to constitute Licensor (or the Mariz Licensee, JWO or any
of
their respective Affiliates) and Licensee (or Costco Japan) partners or joint
venturers or so as to create any other form of legal association which imposes
liability upon either party for the acts or omissions of the other
party.
13.3 Failure
by either
party to take action against the other shall not affect its right to require
full performance of this Agreement at any time thereafter. The waiver
by either party of the breach of any provision of this Agreement by the other
shall not operate or be construed as a waiver of any subsequent breach by such
party.
13.4 Should
any term,
covenant or condition of this Agreement or the application thereof to any Person
or circumstance be invalid or unenforceable, the remainder of this Agreement,
or
the application of such term, covenant or condition to Persons or circumstances
other than those as to which it is held invalid or unenforceable, shall not
be
affected thereby and each term, covenant and condition of this Agreement shall
be valid and enforced to the fullest extent permitted by law.
13.5 Any
notice, demand
or request required or permitted to be given hereunder shall be in writing
and
shall be deemed effective one (1) business day after having been faxed or four
(4) business days after been mailed by prepaid, registered or certified mail,
return receipt requested, to the addressee as follows: (i) if to Licensor,
at
the address set forth above or at the following fax number: x00 0000 000 000;
or
(ii) If to Licensee, at the address of Licensee set forth above or at the
following fax number: 000-000-0000. Any party may change its address
or fax number for the purposes of this Agreement by giving written notice
thereof to the other party in accordance with this provision.
13.6 This
Agreement, and
the tri-party agreement dated the date hereof among Licensor, Licensee and
JWO
(the “Tri-Party Agreement”), sets forth the entire agreement and understanding
between the parties with respect to the subject matter hereof and supersedes
all
prior discussions and negotiations. Nothing in this Agreement or the
Tri-Party Agreement shall affect the exclusion of the Territory pursuant to
the
terms of or supersede the License Agreement between the parties dated as of
December 1, 1996, as amended in writing from time to time. Neither party shall
be bound by any conditions, definitions, representations or warranties with
respect to the subject matter hereof other than those contained in this
Agreement, in the Tri-Party Agreement or hereafter set forth in a writing duly
executed by the parties. No
provision of this Agreement may be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in writing signed by each party
hereto.
13.7 Licensee
shall not
be entitled to assign or otherwise transfer any of its rights and obligations,
or subcontract the performance of substantially all of its obligations, under
this Agreement, except to an Affiliate of Licensee, or in the event of a change
of ownership or control of Licensee, including a sale of substantially all
the
assets of Licensee. Licensor shall not be entitled to assign or otherwise
transfer any of its rights and obligations, or subcontract the performance
of
substantially all of its obligations, under this Agreement, except to an
Affiliate of Licensor, or in the event of a change of ownership or control
of
Licensor, including a sale of substantially all the assets of Licensor. In
all
cases of permitted assignments pursuant to the foregoing: (i) prior written
notice of such assignment must be given by the assigning party to the other
party to this Agreement; (ii) the assignee must agree in writing in advance
to
be bound by the provisions of this Agreement in favour of the other party to
this Agreement; and (iii) in the case of an assignment or other transfer in
connection with a sale of substantially all the assets of either party, the
assigning party shall be released from all of its obligations under this
Agreement accruing as and from the date of such assignment.
13.8 The
parties agree
to perform such acts and execute and deliver such documents as may be reasonably
necessary or desirable from time to time in order to give full effect to the
provisions hereof.
13.9 This
Agreement
shall be governed by and construed and enforced in accordance with the laws
of
England and Wales, without reference to its conflicts of law
principles.
(signature
page
follows)
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IN
WITNESS
WHEREOF, THE PARTIES HAVE EXECUTED THIS AGREEMENT AS OF THE ______ DAY
OF SEPTEMBER, 2007.
|
MARIZ
GESTAO E INVESTIMENTOS LIMITADA
|
SCHIFF
NUTRITION GROUP, INC.
|
|||
|
Per:
|
Per:
|
|||
(949485)
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15 -
SCHEDULE
“A”
TRADEMARKS
|
“Move
Free” Trademarks
|
International
Classes
|
Registration
Number
|
Country
|
|||
|
Move
Free
|
05,
30,
32
|
0000000
|
Xxxxx
|
|||
|
Move
Free
|
29
|
0000000
|
Japan
|
|||
|
“Schiff”
Trademarks
|
International
Classes
|
Registration
Number
|
Country
|
|||
|
Schiff
|
29
|
0000000
|
Japan
|
|||
|
Schiff
|
29,30
|
0000000
|
Xxxxx
|
|||
|
Xxxxxx
|
0,
00
|
0000000
|
Xxxxx
|
SCHEDULE
“B”
FORM
OF
UNDERTAKING
[Date]
Mariz
Gestao e
Investimentos Limitada
Xxx
xxx Xxxxxx, Xx.
00-0x, 0000
Xxxxxxx,
Xxxxxxx,
Xxxxxxxx
|
Re:
|
That
certain
License Agreement dated as of September ____, 2007 between Mariz
Gestao e
Investimentos Limitada (the “Licensor”) and Schiff Nutrition Group, Inc.
(the “Licensee”) (as same may be amended, restated or supplemented from
time to time, the “License
Agreement”)
|
Sirs:
Each
capitalized
term used but not defined in this Undertaking has the meaning given to it in
the
License Agreement.
The
undersigned,
[Name of the undersigned Additional Corporation], a [jurisdiction of the
undersigned Additional Corporation] corporation and an Additional Corporation,
hereby undertakes to be a licensee and beneficiary of the rights of the Licensee
under the License Agreement and hereby assumes and agrees to be bound by all
of
the terms and conditions of the License Agreement applicable to the Licensee
thereunder on a joint and several basis with the Licensee and with all other
Additional Corporations who have executed and delivered a similar undertaking
(the Licensee, the undersigned and all other Additional Corporations who have
executed and delivered a similar undertaking being hereinafter collectively
referred to as the “Licensee Group”).
The
undersigned
confirms that it has received and reviewed a copy of the License Agreement,
together with all amendments, restatements, supplements, and modifications
thereto in effect as of the date hereof, and hereby declares being satisfied
therewith.
All
notices to the
undersigned under the License Agreement should be directed to: [Contact person
with the undersigned], [Name of undersigned], c/o Schiff Nutrition Group, Inc.
in accordance with the provisions of Section 13.5 of the License
Agreement.
All
statements,
reports and other documents containing information or data relating to the
Licensee which are required or permitted to be provided by the Licensee to
the
Licensor pursuant to the License Agreement shall be provided by the undersigned
to the Licensee, who will consolidate them with all other similar information
or
data relating to all members of the Licensee Group.
All
decisions,
consents, approvals, and instructions of the Licensee under or relating to
the
License Agreement shall be binding upon the undersigned and all other members
of
the Licensee Group to the same extent as it is binding upon the
Licensee.
Any
exercise of
rights, remedies or recourses by Licensor under the License Agreement, this
Undertaking or any similar undertaking or at law against any member of the
Licensee Group shall be binding upon and enforceable against all other members
of the Licensee Group.
This
Undertaking
shall be governed by and construed and enforced in accordance with the laws
of
the United Kingdom, without reference to its conflicts of law
principles.
Very
truly
yours,
[Name
of Additional
Corporation]
|
By:
|
|
|
Title:
|
|
|
Acknowledged
and Agreed:
|
|
|
Schiff
Nutrition Group, Inc.
|
|
|
By:
|
|
|
Title:
|
|
|
Accepted:
|
|
|
Mariz
Gestao
e Investimentos Limitada
|
|
|
By:
|
|
|
Title:
|
|
3750871
051007
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