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Exhibit 10.36
AGREEMENT
AGREEMENT (this "Agreement"), made effective September 1, 1998, between The
Educational and Professional Publishing Group, a unit of The XxXxxx-Xxxx
Companies, Inc., ("XxXxxx-Xxxx"), a New York corporation, with an office located
at 000 Xxxxxxxx Xxxxx, Xxxxxxxxxxx, XX 00000 ("EPG"), and the Princeton Review
Publishing L.L.C., a Delaware limited liability company with an office located
at 0000 Xxxxxxxx, 0xx Xxxxx, Xxx Xxxx, XX 00000 ("TPR").
WITNESSETH:
WHEREAS, EPG and TPR are each publishers of proprietary educational materials,
and
WHEREAS, EPG and TPR intend to establish a long-term relationship, in which TPR
provides consulting services and creative materials which help relate EPG's
textbooks to state and national exams through editing of those textbooks and
creation of workbooks, seminars, and possibly an online product under a separate
agreement.
NOW THEREFORE, EPG and TPR agree as follows:
I. DEFINITIONS
Any capitalized term (or grammatical variant) that appears in this Agreement is
defined as follows:
A. "Deliverable" means any item that a Project Agreement
specifies that TPR is required to deliver.
B. "Display," and "Work Made for Hire" have the same definitions
that those terms have in the U. S. Copyright Act, 17 U. S.
C.Section 101, as amended.
C. "Divisions" means the following divisions of EPG:
Glencoe/XxXxxx-Xxxx, SRA/XxXxxx-Xxxx, CTB/XxXxxx-Xxxx, and the
XxXxxx-Xxxx School Division.
D. "Educational Market" means educational institutions of all
types, public and private, at all grade levels, including
pre-school, elementary school, middle, junior and senior high
school, and all customer types located therein, including
students "taught at home," and all K-12 marketing channels of
distribution within which EPG directs its marketing and
selling efforts. The Educational Market excludes the retail
consumer market, the educational trade book market, the 2- and
4-year college market, and the professional book market
channels of distribution related to the foregoing markets.
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E. "XxXxxx-Xxxx Materials" means all educational materials
including text, computer programs, pictorial or graphic works,
know-how, pedagogy, methods, and other works, which
XxXxxx-Xxxx provides to TPR for inclusion in a Textbook or
Workbook.
F. "Textbook" means textbooks, both student and teacher editions,
that any EPG Division publishes for the Educational Market and
which TPR supports, e.g. the Textbook contains TPR Textbook
Contributions or any part of the Question Pool, has received
TPR Editorial Review, or contains any TPR Xxxx or a reference
to the association with TPR or it is sold using the
association with TPR as part of the advertising or promotional
program; or EPG distributes a related Workbook; or TPR
provides a related Training Seminar or online product.
G. "TPR Materials" means all educational text, computer programs,
pictorial or graphic works, questions, know-how, pedagogy,
methods, and other creative works, which result from TPR's
services under this Agreement or the Project Agreements.
H. Each of the following terms is defined in the Section set
forth next to it:
Acceptance IV.E
Approval Period IV.E
Brand Fee V.C
Change Order IV. C
Confidential Information XVII.B
Derivative Questions II.B.4
Design Document III.A
Educational Publisher XVI.A.
EPG Marks IX.A
EPG Programs V.D.1
Net Sales V.D.6
North America VIII.C
Online Product III.B.6
Project IV.A
Project Agreement IV.A
Project Manager IV.B
Question Pool II.B.4
Specification IV.A
Third Party Materials VIII.A
TPR Editorial Review II.X.x
TPR Marks IX.A
TPR Textbook Contributions II.B.2
Trademark Materials XI.B
Trademarks IX.A
Training Seminars II.B.5
Workbooks II.B.3
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II. THE PARTIES' PERFORMANCE OBLIGATIONS
A. EPG's responsibilities include the following:
1. prepare Textbooks in accordance with EPG's business
judgment, and, unless otherwise agreed, publish them
within eighteen (18) months of Acceptance of TPR's
Deliverable agreed under a Project Agreement for that
particular Textbook, in such style and manner, under
any imprint of any EPG Division and at a price EPG
deems in the best interest of such Textbook; and keep
the Textbooks in print for as long as EPG deems
appropriate. EPG's good faith determination of the
schedule for, and timing of, publication will be
binding on TPR. If a Textbook is being prepared in
anticipation of an adoption, and the adopting agency
postpones or otherwise delays the adoption, the
eighteen- (18-) month period referenced above will be
extended for a corresponding period;
2. print, publish and sell Workbooks created by TPR,
either alone or bundled with each Workbook's
corresponding Textbook;
3. contribute XxXxxx-Xxxx Materials for TPR's use in the
creation of TPR Textbook Contributions and Workbooks;
4. contribute to the Question Pool * questions from its
CTB Division in the same subject matters and in
approximately the same relative percentages for each
subject matter as the questions that TPR is creating
under Paragraph II.B.4;
5. arrange and schedule Training Seminars through EPG's
Regional Sales Offices;
6. sell and market the Online Product, if the parties
decide to develop it.
B. TPR's responsibilities include the following:
1. review, within the limits of its available resources
as TPR will decide in its sole discretion, the first
page proofs, in whole or in part, of pupil and
teacher editions of EPG-prepared Textbooks and offer
oral or written comments and suggestions for ensuring
that sample test questions and other testing
information contained in them is accurate and aligned
with state or national standards ("TPR Editorial
Review"). TPR will inform EPG if it declines to
perform TPR Editorial Review in whole or in part, but
if it performs, it will report to EPG as part of the
Project Agreement the
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number of pages it will review. TPR Editorial Review
is intended to enhance, not replace, EPG's normal
editorial and fact-checking procedures and will be
completed in accordance with a schedule to be agreed
upon in writing by the parties;
2. prepare one-color pages and other contributions for
Textbooks, which may include TPR Materials and
XxXxxx-Xxxx Materials ("TPR Textbook Contributions");
3. prepare Workbooks in print format, each of which will
refer to a particular Textbook, or review and revise
existing EPG workbooks ("Workbooks");
4. create a pool of test questions that can be used by
students in grades 2-12 to practice for the major
state and national exams (the "Question Pool") and,
subject to EPG's determination in Section V.B.4,
support the Question Pool so as to keep it
technically up-to-date and able to accommodate minor
changes to the exams. The initial Question Pool will
include * questions that EPG contributes from its CTB
Division, * questions from TPR's then-current and
future inventory, and * that TPR will create (at
least * for each of math and language arts and at
least * for each of science and history) on the
schedule set out in the attached Exhibit A. If TPR
creates a question by electronically altering a
question from one test so that it conforms to the
appropriate format of a new test, TPR will count the
new question as * of a question for the purpose of
meeting its quota of questions; if TPR creates a
question by manually altering a question from one
test so that it conforms to the appropriate format of
a new test, TPR will count the new question as * of a
question for the purpose of meeting its quota of
questions. All such altered questions shall be known
as "Derivative Questions." Each question in the
Question Pool will be tagged so as to identify
whether it was created by TPR, contributed by TPR,
contributed by CTB Division, or, if a Derivative
Question, from what question it was derived. The
major states are Texas, California, Florida,
Virginia, and North Carolina, and the major exams are
the SAT, ACT, CTBS, Terra Nova, SAT9, and ITBS. If
the parties agree, the Question Pool may be expanded
to include other states or tests;
5. prepare and conduct pre-service, in-service, and
other seminars for teachers and administrators about
state or national tests, at times and locations as
the parties agree ("Training Seminars"); EPG shall
have the right, pursuant to a Project Agreement, to
review the format, content, and materials that TPR
uses for the Training Seminars, and TPR will conduct
Training Seminars only with the request and prior
approval of the appropriate EPG Regional Sales
Office;
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6. sell and market the Online Product, if the parties
decide to develop it.
III. DEVELOPMENT OF THE ONLINE PRODUCT
A. Design Document. EPG will pay * toward the creation of a
design document which contains specifications, features,
schedules, and cost estimates for an online product for
students, their parents, and teachers that complements the
Textbooks ("Online Product") to be delivered through the
Internet ("Design Document").
B. Delivery and Approval. Not later than three days after
execution of the Agreement, TPR will deliver the Design
Document, which will include TPR's proposed price for the
Online Product and a yearly base online fee. After TPR's
delivery of the Design Document, EPG will have up to
forty-five (45) days in which to decide whether to proceed
with the Online Product at TPR's price. If EPG elects to go
forward, the parties will enter into a separate agreement.
C. Option. If EPG elects not to proceed with the Online Product,
TPR will be free to negotiate with a third party for
publication of the Online Product based on the Design
Document, except that if TPR negotiates such a deal within the
six (6) months following EPG's rejection of TPR's offer for a
price that is less than the price that EPG rejected, TPR must
again offer publication to EPG at that price, and EPG will
have ten (10) days in which to accept it.
D. If EPG elects not to go forward with the Online Product, TPR
will own all rights including copyright in the Design
Document. If TPR publishes the Online Product with another
entity, TPR will repay EPG * from the first proceeds of that
publishing venture; if TPR publishes the Online Product
itself, TPR will repay EPG * which will be offset against the
royalties due under Section V.D.1 in three equal amounts over
the three years following TPR's publication.
IV. PROJECT AGREEMENTS AND PROJECT MANAGERS
A. Project Agreements. TPR Editorial Review, TPR Textbook
Contribution, Workbook, Training Seminar, Question Pool, and,
if developed, Online Product (collectively or singly,
"Project") must be the subject of a Project Agreement that
conforms to the Sample Project Agreement attached to this
Agreement as Exhibit B and incorporated in it ("Project
Agreement"). No Project Agreement is effective unless signed
by both parties. "Specifications" refers to all the
information contained in a Project Agreement or a Change
Order. No Specification in a Project Agreement that conflicts
with a provision of this Agreement is valid, unless the
Project Agreement is signed by an officer of each of the
parties.
B. Project Manager. Each party must designate a "Project Manager"
for each Project Agreement. Each of the Divisions is entitled
to negotiate and enter into Project
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Agreements with TPR. EPG's Project Manager will initiate
Project Agreements. Project Managers will be responsible for
managing each party's performance under a Project Agreement.
Project Managers will coordinate and facilitate communication
between the parties, direct activity for their respective
parties, send and receive notices, schedule meetings, review
and accept Deliverables and the performance of services, and
authorize payments, among other management duties.
C. Change Orders. Material changes in the Specifications of a
Project Agreement or for any material aspect or detail related
to the performance of a Project, including changes in
Deliverables, schedule dates, payment amounts, or other
matters will be made by use of a Change Order that conforms to
the Sample Change Order attached to this Agreement as Exhibit
C ("Change Order"). A Change Order will become part of the
Project Agreement that it modifies, and will become effective
only when it is signed by each party's Project Manager for the
Project Agreement that it modifies, but no Specification in a
Change Order that conflicts with a provision of this Agreement
is valid, unless the Change Order is signed by an officer of
each of the parties.
D. Progress Reports. Project Managers will notify each other
promptly of any factor, occurrence, or event that may affect
the party's ability to meet the Specifications of a Project
Agreement or that is likely to occasion any material delay or
accelerate completion of the Project. As reasonably requested,
TPR's Project Manager will provide EPG from time to time with
oral or written reports on the progress of services performed
and required under each Project Agreement. Unless EPG gives
notice of dissatisfaction within five (5) business days of
TPR's report, TPR will be entitled to assume that its progress
is satisfactory to EPG, and EPG will not later claim lack of
Acceptance based on circumstances of which it was notified but
did not object.
E. Acceptance. TPR will deliver any Deliverable for any Project
in accordance with the applicable Project Agreement, including
timetables. The Deliverables for any Project including
electronic files and/or camera-ready copy shall be prepared in
accordance with professional standards in the trade.
"Acceptance" means that EPG has determined in its reasonable
judgment that a Deliverable or TPR's services meet the agreed
Specifications in the applicable Project Agreement and this
Agreement, or EPG's Project Manager has allowed the Approval
Period to pass without rejecting TPR's Deliverables or
services. The "Approval Period" will be a reasonable period to
keep the Project on schedule, generally not to exceed 14 days
after TPR's delivery of a Deliverable.
F. Non-Acceptance. If EPG determines that a Deliverable or
service is not Acceptable, EPG will so notify TPR within the
Approval Period specifying to the
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extent practical, how and to what extent, the Deliverable or
service is deficient and how it should be modified in order to
make it Acceptable. TPR will make changes in the Deliverable
or provide additional services at its own cost to make the
Deliverable or services Acceptable and re-deliver the revised
Deliverable to EPG. EPG will indicate its Acceptance of the
revised Deliverable according to the procedure established for
Acceptance of any Deliverable.
G. Deliverables and Services that are Not Acceptable. If TPR
fails to modify or correct Deliverables or services or if,
after modification, they are still not Acceptable to EPG, EPG
will have the right, in its sole discretion:
1. to permit TPR to finish, correct or improve any
unsatisfactory Deliverable of a Project by a
reasonable date specified by EPG, or
2. either as an alternative or in addition to TPR's
revision under (1) above, to make arrangements with
third persons or entities, as EPG may select, to
correct, revise and complete the Deliverable so as to
make it Acceptable to EPG. In that event, EPG may
charge the reasonable cost of such arrangements to
TPR from funds due to TPR under this Agreement giving
TPR credit for any savings EPG may have realized, but
the costs of those changes charged to TPR will not
exceed the monies due TPR for the applicable Project
Agreement.
V. PAYMENT FOR PROJECTS AND ROYALTIES
A. Payment Authorization. No royalty or other compensation will
be due or payable to TPR in relation to any Project or the
exercise of any rights, except as is expressly provided in
this Agreement as duly amended or in a Project Agreement or
Change Order.
B. Project Fees.
1. For TPR's services in connection with the TPR
Textbook Contributions and Workbooks, EPG shall pay
TPR * per one-color page. The payment may vary
upwards upon mutual agreement reflected in a Project
Agreement depending on factors such as increased
complexity, additional colors, and, in future years,
inflation based on the Consumer Price Index. The
payment may also vary downwards upon mutual agreement
if the TPR Workbook or the TPR Textbook Contributions
require only minor revisions due to small changes in
a state test or in the related Textbook. Unless
otherwise provided in the Project Agreement, EPG
shall pay TPR half of the fee due under each Project
Agreement upon signature, and the remainder within 45
days of TPR's final delivery of the Deliverable under
any Project Agreement unless the Deliverable is
rejected within the Approval Period.
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EPG's final payment will not by itself be deemed
Acceptance of the Deliverable if the Deliverable has
been rejected during the Approval Period, and EPG
shall have a right to set off against amounts due to
TPR under this Agreement any final payment made on a
Deliverable that is not Accepted within the Approval
Period. TPR acknowledges receipt from EPG of a
pre-payment of * toward the services under this
provision.
2. For TPR's services in connection with TPR Editorial
Review where there has been review only and no TPR
Textbook Contribution, EPG shall pay TPR * for each
edited page that EPG submits to TPR for review.
3. For conducting Training Seminars, EPG shall pay TPR
monthly * per full-day seminar and * per half-day
seminar, plus reimbursement of costs for travel,
lodging, and meals, upon submission of reasonable
proof of expenditures over $50 in accordance with
EPG's reimbursement policies and practices, and the
TPR regional office will invoice EPG's local regional
sales office directly for such services and costs.
EPG is responsible for invoicing and collections from
customers.
4. Question Pool. Under a Project Agreement under this
Agreement for TPR's preparation of * questions as
provided in Paragraph II.B.4, EPG will pay a total of
* according to the following schedule: for contract
year * for contract year * and for contract year *
The payment for the 1998-99 contract year is due upon
execution of this Agreement, and subsequent payments
are due on the anniversary date of this Agreement. In
addition, EPG will pay TPR * annually at the
beginning of each contract year in order to support
the Question Pool, except that after the first year
and on six (6) months' notice, EPG may discontinue
the * support fee if it reasonably concludes that
continued support of the Question Pool is unnecessary
to its continued usefulness. The first annual fee
will be due upon execution of the Agreement. If new
questions are required because of changed
circumstances such as new tests, they will be
prepared under separate Project Agreements that
include an agreed fee.
C. Brand Fee. Within 45 days of December 1, 1998, and within 45
days of December 1 of each subsequent year of the contract,
EPG will pay TPR for use of the TPR Trademarks on materials in
the EPG Programs as follows: *
D. Royalties.
1. During the term of the Agreement, EPG shall pay TPR
the following royalties based upon net sales of all
components of all EPG Programs except those listed on
Exhibit D, which may be amended by mutual consent,
and upon net sales of any Textbook or Workbook with a
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copyright date earlier than EPG Programs, to which
TPR has contributed or which it supports in any way:
a. For all language arts programs, *
b. For all non-language arts programs, *
An "EPG Program" means each program for the math
subject area beginning with those bearing a 1999
copyright date and each program for the social
studies, science, reading/literature, and language
arts subject areas beginning with those bearing a
2000 copyright date, which are published by the
Glencoe/XxXxxx-Xxxx and XxXxxx-Xxxx School Divisions
and the Open Court Reading and Open Court Math
programs of the SRA/XxXxxx-Xxxx Division.
Notwithstanding the foregoing, EPG Programs do not
include the 1999 Glencoe/XxXxxx-Xxxx "Math
Applications and Connections" math program outside of
Texas unless TPR later contributes or supports it in
some way.
2. As soon as EPG establishes its divisional sales
projections, it will provide TPR with the sales goals
(in dollars) for the EPG Program that make up those
projections, which shall constitute Confidential
Information under Section XVII.
3. If an EPG Program exceeds its sales goal, EPG will
pay an additional royalty as follows:
a. for those net sales that are more than * and
less than or equal to * the above goal, an
increase of * ,
b. for those net sales that are more than * and
less than or equal to * the above goal, an
increase of * and
c. for those net sales that are more than * the
above goal, an increase of *
4. If an EPG Program fails to meet its sales goal, the
royalty rate otherwise payable to TPR on such EPG
Program shall be reduced as follows:
a. if such net sales are less than * of that
EPG Program's goal but not less than * of
goal, a reduction of * ,
b. if such net sales are less than * of that
EPG Program's goal but not less than * of
goal, a reduction of * ,
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c. if such net sales are less than * of that
EPG Program's goal, a reduction of *
5. After the termination or expiration of this
Agreement, EPG will continue to pay TPR royalties at
the rates stated in Sections V.D.1 and D.6 for any
EPG Program to which TPR contributed in any way
during the term of the Agreement.
6. In any contract year, the royalty amounts due TPR
will not exceed *
7. Notwithstanding the foregoing royalty obligations, on
all copies of any elements of the EPG Programs sold
at a * forth in Section V.D.1 above.
8. No royalties are payable for the following: copies of
a Textbook or any component of an EPG Program,
distributed or disposed of at or below cost,
including copies provided in connection with the sale
of other copies; copies furnished for review,
publicity, promotion, sample or similar purposes, or
for charitable or other public purposes; or for
copies furnished gratis to TPR or to others at TPR's
request. For purposes of this provision, copies sold
or distributed or disposed of at a discount of * or
more from the lowest state adoption price of the
Textbook, shall be deemed sold below cost.
9. As used in this Section, V.D, "net sales" means, with
respect to EPG's sales, the net cash amount actually
received by EPG from each copy sold of any component
or material in the EPG Programs or, after the
termination of the agreement, any Textbook, not
credited for return, after discounts, any depository
charges and exchange allowances.
10. Beginning after publication of the first Textbook,
EPG will render royalty statements in April and
October for semi-annual accounting periods ending
December 31, and June 30 of each year in accordance
with its regular practices. Each statement will be
accompanied by payment of monies shown to be due
after recoupment of amounts payable as recoverable
advances, if any.
11. EPG's failure to pay the Brand Fee, royalties, or
Project Fees when due, unless excused by TPR, is a
material breach of the Agreement, entitling TPR, in
addition to all other remedies, to terminate the
Agreement.
VI. AUDITING
Each party shall keep and maintain accurate books and records with
respect to financial
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transactions relating to this Agreement. Where financial figures have
been agreed upon as an element of this Agreement or a Project
Agreement, each party and its agents shall have audit rights and access
to the other's books and records limited to those financial figures,
upon reasonable notice, at reasonable intervals, to determine the
accuracy of such financial figures and the royalties due under this
Agreement or any Project Agreement. Such examination shall be at the
examining party's expense unless it discovers accounting errors of more
than four percent (4%) to its disadvantage for any single accounting
period, in which case, the examined party will pay the reasonable costs
of the audit.
VII. COPYRIGHT AND LICENSES
A. Ownership. EPG and TPR agree as follows concerning ownership
and the respective rights and licenses of each party:
1. XxXxxx-Xxxx Materials. As between XxXxxx-Xxxx and
TPR, XxXxxx-Xxxx owns or controls all rights,
including copyright in XxXxxx-Xxxx Materials, unless
otherwise stated in writing by EPG. EPG may provide
TPR with XxXxxx-Xxxx Materials, at EPG's sole cost,
for use in or in connection with any Project,
together with the right to adapt the XxXxxx-Xxxx
Materials for the purposes of this Agreement as
stated in a relevant Project Agreement.
2. TPR Materials. As between TPR and EPG, TPR owns or
controls all rights, including copyright, in TPR
Materials.
3. TPR Editorial Review. TPR Textbook Contributions and
Workbooks. Except for TPR Material that is contained
in the Question Pool, Online Product, if developed,
and Training Seminars and subject to Section XIII.B,
all TPR Materials created in performing the TPR
Editorial Review, and contained in the TPR Textbook
Contributions and the Workbooks have been specially
commissioned by EPG as Works Made For Hire, and EPG
shall be considered the author and the owner of the
copyright in them for all time everywhere in the
world. If it is determined that the TPR Materials
that EPG has commissioned as Works Made For Hire are
not Works Made For Hire, then as of the date of this
agreement and subject to Section XIII.B, TPR hereby
assigns them to EPG outright and forever throughout
the world.
4. Question Pool. TPR and EPG jointly own all right,
title and interest in the TPR Question Pool,
including copyright, except that (a) the TPR
questions contributed from TPR's inventory and
Derivative Questions based on them shall remain the
property of TPR, and (b) any questions supplied by
CTB and Derivative Questions based on them shall
remain the property of CTB.
5. TPR Training Seminars. TPR owns all right, title and
interest, including
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copyright, in the Training Seminars.
6. EPG is not authorized to revise any Textbook or any
component of an EPG Program using any TPR Materials
or TPR Marks in which TPR owns rights without
entering into a new agreement with TPR. Nothing shall
prevent EPG from revising any Textbook or component
of an EPG Program without use of TPR Materials or TPR
Marks.
B. Copyright Notices. EPG and TPR will publish respectively EPG
Programs and Textbooks (EPG) and Training Seminars and, if
developed, the Online Product (TPR) with copyright notices in
conformity with United States copyright law and the Universal
Copyright Convention, including notice of the other's
copyright in any TPR Materials or XxXxxx-Xxxx Materials. After
publication, each party may, but is not obligated to, register
copyright in its respective works in its own name (or, for
EPG, the name of one of the Divisions). Each party is
authorized to execute all documents necessary to register
copyright or to extend the copyright in any manner provided by
law anywhere in the world, but is not obligated to do so.
C. Further Documents. Each party agrees to execute any document
the other party deems necessary to evidence, perfect, record,
or otherwise confirm the rights transferred or licensed under
this Agreement.
D. EPG Use of TPR Ideas, Concepts. Any other provision of this
Agreement notwithstanding, in connection with its performance
under this Agreement, EPG and TPR may each use any ideas,
concepts, approaches, suggestions and other similar material
suggested or communicated by the other without additional
credit or additional compensation of any kind.
E. Other Publishing Ventures. Without limitation of any of the
foregoing grants and licenses of this Section VII and so long
as EPG itself receives no revenues, EPG may, without any
additional compensation to TPR, itself publish or license
others:
1. to publish any component of an EPG Program, including
any TPR Materials in whole or in part, in forms and
special formats for the handicapped, such as Braille
and recordings for the reading impaired, throughout
North America in the English or Spanish language, if
applicable rights have been cleared and special
editions of the Textbook, for use in special programs
for the learning disadvantaged;
2. to use selected portions of an EPG Program, including
TPR Materials for publicity or promotional purposes
for the EPG Programs in print format and on radio and
television broadcasts; and
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3. to publish in any form, excerpts, summaries, and
serializations of any part of an EPG Program,
including Textbook and TPR Textbook Contributions in
audiovisual, computer, or other versions of the
Textbooks, only for use in connection with or to
assist in use of a version of the Textbooks or in
advertising and promotion of a version of the
Textbooks, provided that TPR has reviewed them and
TPR will not unreasonably refuse a request to do so.
4. Display on Closed Circuit Cable Systems. EPG may
license others, free of charge, to Display and
transmit any part of an EPG Program, in whole or in
part, including any Textbook or Textbook
Contribution, by means of closed circuit cable
systems intended primarily for educational purposes.
VIII. LICENSED THIRD-PARTY MATERIALS
A. TPR will obtain written, non-exclusive licenses to include in
Projects any third-party material included in the TPR
Materials that is still in copyright as well as any other
material for which permission is necessary in connection with
TPR's warranties in Section XIV of this Agreement ("Third
Party Materials"). Third Party Materials include text,
computer programs, pictorial or graphic works, musical
compositions, sound recordings, audiovisual works and other
copyrightable material licensed from a third party. If TPR is
unable to obtain licenses for the rights set forth in Section
VIII.C. that are satisfactory to EPG, mutually agreeable
material will be substituted.
B. EPG will obtain written licenses to include in Projects any
third-party material in copyright that EPG directs TPR to
include in Projects.
C. Scope of Third-Party Licenses. To the extent possible, TPR
will obtain rights to Third Party Materials in the English
language for print media and, if appropriate, online
publication in the Educational Market (1) in the United States
of America, its territories and possessions, (2) in those
jurisdictions outside the United States, which EPG will
identify for TPR, that service the U.S. military (Xxxxx) and
other U.S. agency-related personnel or at which American
textbooks are used on a regular basis, such as "American" or
"International" schools established principally to educate
American or English speaking nationals, and (3) in the
Dominion of Canada (all the foregoing, "North America"). If
the parties agree in specific Project Agreements to designate
the Spanish Language or any other language, electronic or
other media publication rights, or other rights, including
worldwide rights, then to the extent possible, TPR will obtain
such rights in Third Party Materials.
D. Documentation of Licenses. TPR agrees to deliver to EPG copies
of all licenses
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for Third Party Materials and, if not provided in those
documents, the source of the Third Party Materials, the
grantor's name and address, and, if for a computer program,
the release and version numbers. Licenses for Third Party
Materials are to be in a form EPG provides or, if not
provided, in whatever form TPR chooses. TPR will provide this
information and documentation as part of the on-going
developmental process but not later than the final delivery of
Deliverables for any Project Agreement.
E. Costs of Licenses. EPG will pay the costs of the licenses for
Third Party Materials either directly to the third-party owner
or by reimbursing TPR in those cases where TPR has paid the
third-party owner.
IX. TRADEMARK LICENSES
X. Xxxxx. "Trademark" means the trademarks, service marks, and
trade names listed in the attached Exhibit E, as amended from
time to time, whether or not registered (collectively, the
"Trademarks"). Trademarks owned by TPR are identified as "TPR
Marks." Trademarks owned by XxXxxx-Xxxx are identified as "EPG
Marks."
B. Ownership of Textbook and Workbook Titles. EPG may obtain
trademark or service xxxx protection for the name that it
chooses to identify any EPG Program, Textbook, Workbook, or
other component of it. EPG shall own all rights in such
Trademarks. TPR agrees to cooperate to the extent reasonably
requested by EPG in furnishing information and executing
documents which may be required in connection with
registration of any such EPG Marks or to confirm EPG's
ownership or rights to use any such EPG Marks.
C. Ownership of Training Seminar and Online Product Titles. TPR
may obtain trademark or service xxxx protection for the name
that it chooses to identify any Training Seminars and the
Online Product. TPR shall own all rights in such Trademarks.
EPG agrees to cooperate to the extent reasonably requested by
TPR in furnishing information and executing documents which
may be required in connection with registration of any such
TPR Marks or to confirm TPR's ownership of or rights to use
any such TPR Marks.
D. EPG Use of TPR Marks. Subject to the terms and conditions of
this Agreement, TPR hereby grants to EPG a non-exclusive,
nontransferable license to use the TPR Marks solely in North
America (1) on and in connection with any Textbook that has
undergone TPR Editorial Review or contains TPR Textbook
Contributions and on Workbooks, (2) with advertising and
promotional materials for the Projects, and (3) to publicize
EPG's relationship with TPR under this Agreement. EPG may not
use or reproduce the TPR Marks in any manner whatsoever other
than as expressly permitted by this Agreement.
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E. TPR Use of EPG Marks. Subject to the terms and conditions of
this Agreement, EPG hereby grants TPR a non-exclusive,
nontransferable license to use the EPG Marks solely in North
America (1) on and in connection with the Training Seminars
and the Online Product, if developed, (2) to publicize the
fact of TPR's relationship with EPG under this Agreement, and
(3) to publicize TPR's contribution to and role in preparing
the Projects. TPR may not use or reproduce the EPG Marks in
any manner whatsoever other than as expressly permitted by
this Agreement.
F. Ownership of Marks. Each party agrees and acknowledges that
the other owns and retains all right, title and interest in
and to its respective Trademarks. Except as expressly granted
in this Agreement, no party shall have any rights in the
other's Trademarks. The licenses each party has granted the
other are personal to the other party, and neither shall
assign, transfer or sub-license its rights in the other's
Trademarks in any manner without the prior consent of the
party owning the Trademarks, and any transfer in violation of
this restriction will not be valid. Neither party will use or
take any action with respect to the other party's Trademarks
except in a manner that does not interfere, derogate or
diminish the party's rights in its Trademarks, either during
the term of this Agreement or afterwards. Each party agrees
not to adopt, use or register any corporate name, trade name,
trademark, service xxxx or certification xxxx, or other
designation similar to, or containing in whole or in part, the
Trademarks belonging to the other. Any and all goodwill
arising from use of the EPG Marks and TPR's Marks shall inure
solely to the party owning said Trademarks respectively. Upon
termination of this Agreement, each party shall cease use of
the other's Trademarks.
X. TRADEMARK IDENTIFICATION; CREDIT
A. Trademark Notices on Textbooks. EPG shall cause to be
imprinted irremovably and legibly marked on each copy of
Trademark Materials, appropriate trademark notices with
respect to the TPR Marks (and any component of them) as TPR
specifies in each case, including the initials "TM" or the
letter "R" encircled, or "*" (asterisk), and such legend(s) as
TPR may require, including a legend indicating that the TPR
Marks are owned by TPR, and are being used by EPG under
license from TPR. The size, location and other details of
placement of the TPR Marks on the Trademark Materials, shall
be determined by EPG in consultation with TPR's Project
Manager.
B. EPG will credit TPR for its contributions to the Projects.
Attribution credit will generally be as follows, but must be
approved by TPR:
1. TPR's Trademark will appear on the title page of a
Textbook (both student and teacher edition);
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2. TPR will be listed as an author or contributor (as
applicable) on those pages where like authors of the
Textbook are listed;
3. TPR will be listed as a content reviewer on the
reviewer page of the Textbook, if TPR performs TPR
Editorial Review.
XI. TRADEMARK QUALITY, INSPECTION AND APPROVAL
A. Quality of Textbooks. EPG agrees to maintain the quality of
the Textbooks and Workbooks on which the TPR Marks are used at
least equal to the quality of textbooks and other materials
currently published by EPG, which employ EPG's own trade name
and TPR Marks. The Textbooks will comply with applicable
National Association of State Textbook Administrators
standards. TPR will likewise maintain the current level of
quality of the materials on which it uses EPG Marks.
B. Samples and Review of Marks. At each party's request, the
other party shall supply the requesting party with suitable
specimens of the Projects and advertising and promotional
materials (singly or collectively, "Trademark Materials"),
which demonstrate its use of the other's Trademarks in the
manner specified in the Agreement. Each party shall cooperate
fully with the other party to facilitate periodic review of
its use of the other's Trademarks and its full compliance with
the quality standards described in this Agreement.
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C. Approval of Trademark Use. Each party will abide by the
other's reasonable requirements with respect to Trademark
usage. Each party reserves the right to approve the other's
use of its Trademarks in promotional materials and in any
press/public releases of information. Each party reserves the
right to approve use of its Trademarks before the other
party's use. Accordingly, each party agrees to submit to the
other for approval, before use, distribution or disclosure all
Trademark Materials. Each party shall act promptly in granting
or denying approval. Once a usage of the marks has been
approved, the same usage need not be resubmitted for approval
and may be used again in the like manner unless approval is
withdrawn by the owner. Any disapproval shall specifically
state the reason(s) for which approval is being denied. Any
approval or denial of approval shall be made within five (5)
business days of submission for review. If either party fails
to respond to a request for review, the submission shall be
deemed approved and may be used by the submitting party
without liability to the other. Approval for any such presumed
usage may subsequently be withdrawn by the owner of the marks,
and the other party shall take all reasonable actions to
curtail and cease such disapproved usage but may use any
existing materials, and any materials which are required to be
produced immediately to meet immediate adoption delivery
deadlines. If problems occur with the foregoing approval
process, either party may request a reasonable change in the
process to alleviate the problem.
D. No Assumption of Liability. Review and approval by either
party of the use of the other's Trademarks shall be limited to
trademark usage, but reasonable and responsible comment may
also be volunteered as to content and context, and each party
will consider the other's comments. Neither party assumes any
liability for the content of the other's advertising,
promotional statements or other materials, even if it has
reviewed and approved usage of its Trademarks in such
materials or communications.
E. For purposes of trademark application, registration,
recordation, and registration in the U. S. or elsewhere in the
world, each party agrees, at the other's reasonable request,
to provide necessary information and samples of Trademark
Materials, and to execute and return promptly to the other any
necessary document, including documents which evidence a
party's ownership, assignment or license of rights with
respect to the Trademarks.
XII. FAILURE TO PUBLISH; REVERSION OF RIGHTS
A. TPR Request for Publication. If EPG does not publish a
Textbook within the period provided in Section II.A.1, TPR may
at any time thereafter deliver to EPG a request under Section
XVIII.H to publish the Textbook within twelve (12) months
after EPG's receipt of TPR's request. If EPG fails to comply
with TPR's request within such period, (1) this Agreement and
the respective Project
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Agreement for the Textbook will terminate without further
notice at the end of such period, and (2) all of TPR rights in
the TPR Materials in the specific unpublished Textbook will
revert to TPR without further obligation or liability on the
part of either party to the other, except for any questions,
which will become part of the Question Pool. The termination
and reversion of rights provided in this Section XII.A shall
be TPR's sole remedy if EPG fails for any reason to Publish a
Textbook in which TPR Materials were intended to appear.
B. Reversion of Rights. Five years after the copyright date of
any Textbook, all of TPR's rights in the TPR Materials for
that Textbook and any related Project shall revert to TPR,
except for any questions, which will become part of the
Question Pool. Notwithstanding that reversion, EPG shall have
the right, subject to the royalty payment provisions of this
Agreement, to continue selling Textbooks and related Projects
as part of the EPG Programs developed during the term of this
Agreement, and any licenses previously granted will continue
in effect to the end of their terms, and EPG will be entitled
to its share of amounts received under any such licenses. EPG
agrees to execute such documents as TPR reasonably requests to
confirm any reversion of rights under this section.
C. Rights After Reversion of Rights. In the event of reversion of
rights under Section XIII.B, EPG shall be entitled to prepare
and publish new or different textbooks using the same or
similar concepts, approaches and organization as were used in
the Textbooks, but shall not publish anything that infringes
TPR's rights in TPR Materials.
XIII TERM AND TERMINATION
A. Term. Except for the payment of royalties due after
termination and any provision that survives termination under
Section XVIII.E, the Term of the Agreement in which the
parties may commence new Project Agreements is four (4) years,
and then the Agreement will renew automatically for one-year
terms unless either party gives one (1) year's prior notice of
termination.
B. EPG's Termination of the Agreement. EPG may terminate this
Agreement under the following circumstances:
1. TPR enters into any voluntary or involuntary
declaration of bankruptcy or there is a general
assignment for the benefit of TPR's creditors
occurring before TPR's delivery to EPG of the final
Deliverables due under any completely executed
Project Agreement, or
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2. TPR materially breaches this Agreement and fails to
cure the breach within the time period specified in
Section XIII.F, or
3. upon notice to TPR, if TPR's failure to perform
Project Agreements is substantial, material, and
repetitive, and TPR has received notice of such
failure(s) and has been accorded a commercially
reasonable opportunity to cure such failures, but has
not done so, with the result that the intent of this
Agreement is frustrated.
C. EPG's Termination of a Project Agreement for Cause. EPG may
terminate a Project Agreement under any of the following
circumstances:
1. if a Deliverable, as corrected, revised, or completed
pursuant to Section IV.G is not acceptable to EPG, or
2. TPR's performance or delivery is so untimely that EPG
is unable to publish Textbooks in accordance with the
school adoption schedules; or
3. TPR materially breaches a Project Agreement and fails
to cure the breach within the time period specified
in Section XIII.F.
D. TPR's Termination of the Agreement. TPR may terminate this
Agreement, in whole or in part in accordance with this Section
XIII if:
1. during the period when a Textbook is being prepared,
EPG or XxXxxx-Xxxx enters into any voluntary or
involuntary bankruptcy or there is a general
assignment for the benefit of EPG's or XxXxxx-Xxxx'x
creditors, or
2. EPG breaches a material provision of this Agreement
and fails to cure the breach within the time period
specified in Section XIII.F.
E. EPG's Termination or Delay of a Protect Without Cause.
Notwithstanding any other provision of this Agreement and any
Project Agreement, EPG shall have the right in its sole
discretion, to terminate or to delay a Project Agreement based
upon changed business circumstances, including cancellation of
an adoption for which the work is being prepared. Upon EPG's
notice to TPR of any such termination or delay, each party
will cooperate to immediately cease performance of said
Project Agreement so as to mitigate costs for each party. EPG
will pay TPR for all services performed that EPG has approved
in accordance with the Project Agreement, up to the date of
termination. EPG will also pay TPR the amount of any bona fide
"cancellation fees" payable to third parties arising from
TPR's canceled commitments to others. In addition, EPG shall
pay to TPR, ten percent (10%) of the amount remaining of the
unpaid Project fees as stated in this
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Agreement and the relevant Project Agreement, as modified by
any Change Order, as liquidated damages, and not as a penalty,
for cancellation. Upon payment, neither party will have any
further obligation or liability to the other under the
terminated Project Agreement, except those that survive under
Section XVIII.E. If EPG delays a Project, the parties will
cooperate to make for a smooth, economical transaction under
the circumstances by adding other Project(s) or by taking
other appropriate measures.
F. Right to Cure. Except for termination under Section XIII.E
above, neither party may terminate this Agreement or any
Project Agreement unless and until the party seeking
termination gives notice to the other party stating that it
intends to terminate this Agreement or any Project Agreement
and specifying the nature of the breach or default and unless
the receiving party fails to cure such breach or default
within thirty (30) days after receipt of the notice (or such
longer period of time as may be specified in the notice).
G. Consequences of Termination
1. Upon EPG's notice of termination of a Project
Agreement under Section XIII.C. l above, EPG may
elect to: (a) retain any Deliverable in its latest
form of completion (including all prior drafts,
versions, builds or releases) and to own whatever
rights in it that have been granted in accordance
with this Agreement and the Project Agreement for
that Project, with no additional payments by EPG
other than what has been made as of termination; or
(b) return the Deliverable to TPR and grant back to
TPR, without warranty of any kind, all rights TPR
granted to EPG under this Agreement and the Project
Agreement for that Project, and TPR will return
payments made under the Project Agreement but not
expended before notice of termination.
2. Upon termination or expiration of this Agreement, TPR
will own all right, title, and interest, including
copyrights and other rights in the Online Product, if
developed, and the parties will divide the Question
Pool evenly and randomly by subject between the two
parties, except that (a) the questions TPR initially
contributed from its inventory shall be allotted to
TPR, (b) the questions CTB initially contributed
shall be allotted to EPG; and (c) the Derivative
Questions shall be assigned to whichever party is
allotted the question from which the Derivative
Question was derived. Each party hereby assigns to
the other party as of the date of termination its
joint right, title, and interest, including
copyright, in the remaining questions in the Question
Pool allotted to the other party. Each party agrees
to execute such documents as the other reasonably
requests to confirm such assignment of rights under
this section.
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3. All the assignments under this Section XIII.G are
subject to the exclusive license granted to TPR in
Section XVI.A.2.
4. If either party terminates this Agreement, the rights
and remedies of the parties are cumulative, and each
party also has all the rights and remedies provided
by law or equity.
H. Effect of a Project's Termination on Other Projects.
Termination of a portion of this Agreement or any Project
Agreement relating to a Project shall not affect those
provisions relating to the rights in copyrights or payment of
royalties or other monies based upon the sale or licensing of
Projects containing TPR Materials or bearing TPR Marks already
published under this Agreement or EPG's recovery of any
advance in royalties EPG paid to TPR.
XIV. REPRESENTATIONS AND WARRANTIES
X. XxXxxx-Xxxx warrants and represents as follows:
1. XxXxxx-Xxxx has the full right, power, and authority
to enter into this Agreement, and XxXxxx-Xxxx has not
and will not assign, pledge or encumber its rights in
the Question Pool to any other person or entity.
2. Except for TPR Materials, the EPG Programs, the
Projects and Textbooks contain nothing that is
obscene, libelous, defamatory, or, when taken as a
whole is substantially inaccurate, or injurious, and
appropriate warnings and safety instructions are
included in Projects concerning any particular
hazards.
3. Except for TPR Materials, the EPG Programs, the
Projects, Textbooks, and EPG Marks contain nothing
that violates or infringes a copyright, patent, trade
secret, or other literary property rights; or that
violates the rights of any person, including the
right of privacy, publicity, or moral right; or that
violates any EPG contract, express or implied; or
that discloses any information that EPG has obtained
in confidence or with the understanding that it would
not be disclosed or published.
4. EPG will use the TPR Marks on and in connection with
any Project solely as provided in this Agreement and
any applicable provision of any Project Agreement and
will not use the TPR Marks on or in connection with
other goods, products or services.
5. EPG makes no representation or warranty concerning
the timing of a Textbook's publication or the number
of copies of a Textbook that will be sold.
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B. TPR hereby warrants and represents as follows:
1. TPR has the full right, power, and authority to enter
into this Agreement and to grant, transfer, and
assign the rights granted and transferred in this
Agreement and TPR has not and will not assign, pledge
or encumber such rights or its rights in the Question
Pool to any other person or entity.
2. Except for Third-Party Materials and any public
domain material, TPR is the sole developer of TPR
Materials, and TPR Materials are original and
previously unpublished, except as may be disclosed in
a Project Agreement.
3. TPR Materials contained in any Projects contain
nothing that is obscene, libelous, defamatory, or,
when taken as a whole, are substantially inaccurate,
or injurious, and appropriate warnings and safety
instructions are included in Projects concerning any
particular hazards.
4. TPR Materials and TPR Marks contained in any Project,
including any programming code, contain nothing that
violates or infringes a copyright, patent, trade
secret, or other literary property rights; or that
violates the rights of any person, including the
right of privacy, publicity, or moral right; or that
violates any TPR contract, express or implied; or
that discloses any information that TPR has obtained
in confidence or with the understanding that it would
not be disclosed or published.
5. TPR will use the EPG Marks on and in connection with
any Project solely as provided in this Agreement and
any applicable provision of any Project Agreement and
will not use the EPG Marks on or in connection with
other goods, products or services.
6. TPR makes no representation or warranties relating to
the content of any Project that is not TPR Materials.
C. Each party shall abide by all applicable laws in performing
this Agreement.
XV. INDEMNIFICATION
A. Each party will defend and indemnify the other party, its
successor and assigns, and any seller or licensee of the EPG
Programs against all damages (including settlement), costs,
and expenses, including reasonable attorney's fees, based on
any third-party claim that said party's contribution infringes
that third party's copyright, trademark, patent, trade secret,
other proprietary right, or that third party's personal
property right, or any third-party claim, which, if proved,
breaches any of
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the representations or warranties made by said indemnifying
party in this Agreement, whether or not the claim results in a
judgment. If such a claim has occurred, or in the opinion of
the party is likely to occur, the other party agrees to permit
the indemnifying party, at its option and expense, to settle
any claim, action, change or proceeding on such terms as it
deems advisable, or either to procure the right to continue
selling, promoting or using the allegedly infringing
contribution, or to replace its contribution or Trademark so
that the allegedly infringing contribution or Trademark is
non-infringing or non-offending. Modification of the
infringing or offending contribution shall not negate the
indemnifying party's obligation to indemnify the other party
in accordance with the terms of this Agreement.
B. Each indemnifying party will have the right to defend with
counsel of its own choosing. If the indemnified party desires
to retain its own counsel, it will do so at its own cost. The
indemnifying party shall pay any resulting costs, damages,
liabilities and expenses, including reasonable attorney's
fees, provided that the party seeking to be indemnified
promptly notifies the indemnifying party of the claim and
cooperates in the defense at the indemnifying party's expense,
and that the indemnifying party has sole control of the
defense and all related settlement negotiations.
XVI. NON-COMPETITION
A. TPR
1. Competition During the Term of the Agreement. During
the term of the Agreement, TPR agrees it will not
enter into a similar agreement with a person or that
part of a firm, corporation, company, partnership or
other entity engaged in the development, publication,
and distribution of proprietary educational materials
to the Educational Market ("Educational Publisher").
Also during the term of the Agreement, each party
(including the Divisions) is entitled to use the
questions that it contributed to the Question Pool
from inventory in other ventures so long as such
ventures do not compete with this Agreement.
2. Competition After the Term of the Agreement. For so
long as a Textbook is being sold as part of an EPG
Program, TPR will not, for itself or an Educational
Publisher, without EPG's prior consent, use or
publish more than forty percent (40%) of the TPR
Materials in another secondary school textbook or
elementary school program, so that such textbook or
program might compete with or injure the
profitability of that Textbook or the EPG Program.
3. TPR Trade Books. Both during and after the term of
this Agreement,
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regardless of which party terminates the Agreement,
TPR will have the exclusive right, without any
compensation to EPG, to use the Question Pool, except
for the CTB questions and derivatives for trade print
publications and for products which are
noncompetitive with the EPG Programs, so long as not
more than forty percent (40%) of any such trade
publication includes questions from the Question
Pool. If the parties do not go forward with the
Online Product under Section III, each party will
have the right to use 50% of the Question Pool
without accounting to the other party, except that
neither party will be able to use the questions that
the other party initially contributed to the Question
Pool from inventory and the Derivative Questions
based on those contributed questions.
B. EPG. During the term of the Agreement, EPG will not retain
another person or business entity to substitute for TPR in
connection with the services that TPR performs under this
Agreement.
C. Ability to Compete. Except as expressly stated in this Section
XVI, each party acknowledges that the other may publish
textbooks, test questions, or materials within the same or
similar areas of general or specific interest as a Textbook
published under this Agreement, and nothing in this Agreement
shall inhibit a party from that practice. Each party
understands that the other party is in the business of
providing goods and services of many types, and it is not the
intent of this Section XVI to unduly curtail the freedom of
either party to conduct its business affairs, to enter into
agreements with others, or to offer goods or services to its
customers in accordance with its business judgment. This
Section XVI is to be construed in a reasonable manner with the
intent of protecting each party's right to carry on its own
business while ensuring that each enjoys the benefits of its
bargain under this Agreement.
XVII. CONFIDENTIAL INFORMATION
A. Nondisclosure. Confidential Information is and remains the
property of the disclosing party. The parties will hold
Confidential Information in confidence and treat it as each
treats its own Confidential Information and will not disclose
it to any third person without the express consent of the
other party, except that the parties may disclose Confidential
Information, including the terms of this Agreement, for the
purpose of obtaining legal, financial or tax advice. A
material failure to abide by these provisions shall constitute
a material breach and cause for termination of this Agreement.
B. Definition of Confidential Information. "Confidential
Information" means all information that either party discloses
to the other and identifies as "confidential"
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or "proprietary," or which, under all of the circumstances,
should reasonably be treated as confidential or proprietary,
including the content of a Textbook, its publication date, the
development fees, royalties rates and amounts paid, all
information that relates to each party's past, present, and
future research, development, plans, sales and business
activities, as well as all information, conclusions, drafts,
programming and associated materials and Textbook product
resulting from TPR's performance under this Agreement. Upon
termination or expiration of this Agreement, each receiving
party will return all Confidential Information to the
disclosing party, or destroy it and certify its destruction.
The terms and conditions of this Agreement and information
learned during an audit conducted under Section VI are
Confidential Information, except that either party may
disclose the terms of the Agreement for the purpose of seeking
legal, financial, or auditing advice so long as such advisors
agree to abide by the confidentiality restrictions of this
Section XVII.
C. Information that is Not Confidential. Confidentiality
obligations shall not apply to any Confidential Information
(1) that at or after disclosure is available to the general
public, other than through a breach by the receiving party;
(2) that is already known to the receiving party before
disclosure; (3) that is developed through the independent
efforts of the receiving party; (4) that the receiving party
rightfully receives from a third party without restriction as
to confidentiality or use; or (5) whose disclosure is required
by law or is requested by legal or administrative process,
except that the party who is served with process will give
immediate notice to the disclosing party of the process and
make reasonable efforts not to disclose the Confidential
Information until the disclosing party has had an opportunity
to make a motion to quash the request.
D. Press Releases. The parties will coordinate and cooperate with
each other in making any public announcement or press release
concerning this Agreement, any Project Agreement, or the
relationship between the parties under the Agreement. To that
end, each party will give the other party reasonable prior
opportunity to comment upon any such release or announcement
and to approve the subject matter, details, and use of the
other's Trademarks in it. Neither party will unreasonably
withhold its approval.
XVIII. MISCELLANEOUS
A. Independent Contractors. Nothing in this Agreement shall be
construed so as to constitute the parties as joint venturers,
partners, or agents of each other, and neither party shall
have the power to obligate or bind the other in any way
whatsoever.
B. Entire Agreement. This Agreement, Exhibits A-D attached to it,
and the related
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Project Agreements constitute the complete agreement between
the parties and supersede all other agreements, promises,
representations, and negotiations, whether written or oral,
between the parties regarding the subject matter of the
Agreement, including the parties' June 10, 1998 letter
agreement.
C. Amendment: Waiver. No amendment or waiver of any provision of
this Agreement will be valid unless in writing and signed by
all parties affected by the amendment or waiver. No waiver
shall be deemed a waiver of a subsequent breach.
D. Assignment. Neither party may assign this Agreement or assign
or delegate its obligations under it without the other's prior
consent, except that TPR can assign any monies payable to it,
and any assignment in violation of this provision shall be
null and void. Notwithstanding the foregoing, each party may
assign this Agreement as a whole in connection with the
transfer and sale of a Division, line of business,
substantially all its assets or the sale or transfer of its
voting shares, upon notice to the other. Should such transfer
create a material conflict of interest for the non-assigning
party, that party may terminate this Agreement upon reasonable
grounds upon prior notice. Subject to the foregoing, this
Agreement will be binding on the parties signing it and on all
their successors and permitted assignees.
E. Survival. The rights and obligations of Sections VI, VII, XIV,
XV, XVI.A.2, XVII, and XVIII, and those other provisions which
by their nature survive will survive the expiration or
termination of this Agreement and will bind the parties and
their successors and assigns in accordance with their terms.
F. Severability. If any provision of this Agreement is held
invalid or unenforceable, the remainder of the Agreement shall
not be affected and shall remain in effect, unless doing so
would deprive one of the parties of the benefit of the
Agreement.
G. Applicable Law and Forum. This Agreement will be construed in
accordance with and governed by the laws of the State of New
York applicable to agreements made and to be performed there
and without regard to it conflict of laws rules. Any disputes
arising out of or related to this Agreement will be brought in
the state or federal courts with jurisdiction in New York
County, New York, and the parties expressly consent to the
exclusive jurisdiction and venue of such courts.
H. Notices. Notices, approvals, disapprovals, excuses, requests,
and consents concerning day-to-day administrative and
performance matters must be in writing and sent to the
respective party's Project Managers. Notices, approvals,
disapprovals, requests, and consents of a substantive or legal
nature required by this Agreement for either party are to be
in writing and shall be forwarded as follows:
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TPR:
---
Xxxx Xxxxxxx, President
The Princeton Review
0000 Xxxxxxxx, 0xx Xxxxx
Xxx Xxxx, X.X. 00000
Telephone: (2l2) 000-0000
Facsimile: (000) 000-0000
with a copy to:
--------------
Xxxx X. Xxxxxxx, Esq.
Patterson, Belknap, Xxxx & Xxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (2l2) 336-2222
EPG:
---
Xxxx Xxxxxx, President
The Educational and Professional Publishing Group
a unit of XxXxxx-Xxxx Companies, Inc.
000 Xxxxxxxx Xxxxx
Xxxxxxxxxxx, Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
--------------
Vice President and General Counsel
Educational Publishing Group
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Changes in address by either party shall be made by notice to
the other party in accordance with this provision. Notices
required by this Agreement shall be deemed received (1) upon
delivery, when delivered in person or by commercially
receipted courier, (2) upon the date sent by facsimile or
other electronic media, if the sender confirms by sending a
copy by courier delivery or U.S. Postal Service, or (3) five
(5) days after deposit with the U.S. Postal Service by
registered or certified mail.
I. Force Majeure: Neither party shall be liable to the other for
any failure or delay caused by events beyond its reasonable
control, including, acts of God, sabotage, accidents, failures
or delays in transportation or communication, labor disputes,
shortages of labor, fuel, raw materials or equipment, or other
matters. Each party shall promptly inform the other of any
such event. Should the event prevent performance of this
Agreement for more than sixty (60) days, the other party may
terminate this Agreement or the applicable Project Agreement;
rights granted under this Agreement shall revert to the
grantor; and each party shall retain its rights in the
Question Pool specified in Section VIII.A.4, may exploit those
rights to the extent permitted by law, and need not account to
the other party with any proceeds from that exploitation.
J. Headings. Headings and captions throughout this Agreement are
for convenience only and should not be considered part of the
substantive terms of this Agreement.
K. Including. "Including" means "including but not limited to"
and "including without limitation."
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L. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement
on the date first set forth above.
EDUCATIONAL AND PROFESSIONAL PRINCETON REVIEW
PUBLISHING GROUP, A UNIT OF PUBLISHING L.L.C.
THE XXXXXX-XXXX
COMPANIES, INC.
By: /s/ Xxxx Xxxxxx By: /s/ Xxxx Xxxxxxx
Title: President Title: President
Date: 12/24/98 Date: 12/28/98
Taxpayer ID No. 00-000-0000
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Exhibit A: Question Pool Schedule
This chart represents the numbers of questions that The Princeton Review will
create, not edit, broken down by grade grouping, major subject area, and the
school year during which the questions will be delivered.
--------------------------------------------------------------------------------
CONTRACT YEAR Math Reading Social Studies Science TOTAL
1998-1999
--------------------------------------------------------------------------------
K-2 * * * * *
--------------------------------------------------------------------------------
3-6 * * * * *
--------------------------------------------------------------------------------
7-8 * * * * *
--------------------------------------------------------------------------------
9-12 * * * * *
--------------------------------------------------------------------------------
TOTAL * * * * *
--------------------------------------------------------------------------------
*
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
CONTRACT YEAR Math Reading Social Studies Science TOTAL
1999-2000
--------------------------------------------------------------------------------
K-2 * * * * *
--------------------------------------------------------------------------------
3-6 * * * * *
--------------------------------------------------------------------------------
7-8 * * * * *
--------------------------------------------------------------------------------
9-12 * * * * *
--------------------------------------------------------------------------------
TOTAL * * * * *
--------------------------------------------------------------------------------
*
--------------------------------------------------------------------------------
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--------------------------------------------------------------------------------
CONTRACT YEAR Math Reading Social Studies Science TOTAL
2000-2001
--------------------------------------------------------------------------------
K-2 * * * * *
--------------------------------------------------------------------------------
3-6 * * * * *
--------------------------------------------------------------------------------
7-8 * * * * *
--------------------------------------------------------------------------------
9-12 * * * * *
--------------------------------------------------------------------------------
TOTAL * * * * *
--------------------------------------------------------------------------------
*
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
SUMMARY Math Reading Social Studies Science TOTAL
--------------------------------------------------------------------------------
K-2 * * * * *
--------------------------------------------------------------------------------
3-6 * * * * *
--------------------------------------------------------------------------------
7-8 * * * * *
--------------------------------------------------------------------------------
9-12 * * * * *
--------------------------------------------------------------------------------
TOTAL * * * * *
--------------------------------------------------------------------------------
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Exhibit B: Sample Project Agreement
--------------------------------------------------------------------------------
Instructions: A Project Agreement is to be prepared by the EPG Contracts,
Copyright & Permissions Department as part of the Contract Request Form
procedures. EPG's Project Managers should initially complete this form and send
it to the Contract Department together with other required materials.
--------------------------------------------------------------------------------
This is a PROJECT AGREEMENT between the Educational and Professional Publishing
Group of The XxXxxx-Xxxx Companies, Inc. ("EPG") and Princeton Review Publishing
L.L.C. ("TPR") under a master Agreement dated _______________ 1998, between EPG
and TPR (the "Master Agreement"). The Master Agreement will govern preparation
and publication of the Textbook. Please complete additional pages, if necessary.
Any capitalized term (or grammatical variant of it) in this Project Agreement
has the same definition as does that term in the Master Agreement.
NAME OF PROJECT:
PROJECT AGREEMENT DATE:
NAME OF EPG DIVISION:
TYPE OF PROJECT: Ownership rights, including copyright rights, to the various
Deliverables that comprise TPR Materials are determined under the Master
Agreement in accordance with Section VII and Section XIII. Therefore, it is
important to correctly classify the various components of TPR Materials, since
such classification will determine each party's ownership rights to these
components of the Textbook. Please circle one:
Editorial Review
Workbook
Question Pool
Online Product
Training Seminar
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NAME OF PROJECT MANAGERS:
EPG: TPR:
Name: _____________________ Name: ______________________
Telephone: _________________ Telephone: __________________
Fax: _______________________ Fax: ________________________
EPG: TPR:
E-mail: _______________________ E-mail: _______________________
(1) NAME OF EPG TEXTBOOK: Insert the title of the Program/Textbook
(if applicable) for which TPR is preparing a contribution
("Project"). Identify the title by name, proposed copyright
date, Edition Number (if applicable), Author's Name (if
applicable), copyright, and other identifying details.
--------------------------------------------------------------
--------------------------------------------------------------
--------------------------------------------------------------
--------------------------------------------------------------
(2) DESCRIPTION OF SERVICES AND DELIVERABLES: Insert a description
of the services TPR is to perform and the TPR Materials that
TPR is to deliver ("Deliverable") hereunder. Attach additional
pages, if needed.
--------------------------------------------------------------
--------------------------------------------------------------
--------------------------------------------------------------
--------------------------------------------------------------
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(3) Will TPR use any XxXxxx-Xxxx Materials in the preparation if
this TPR Work? yes / no If yes, please describe.
--------------------------------------------------------------
--------------------------------------------------------------
--------------------------------------------------------------
--------------------------------------------------------------
(4) MILESTONE EVENTS AND DELIVERY DATES: List all delivery dates
for services and Deliverables of the Project. Use additional
page(s), if needed:
--------------------------------------------------------------
--------------------------------------------------------------
--------------------------------------------------------------
--------------------------------------------------------------
Delivery/Performance Dates
-------------------- -----
(Deliverables/Services to be performed)
(5) OWNERSHIP/LICENSE OF RIGHTS; RIGHTS OBTAINED FOR PERMISSIONS.
Will EPG have the right to publish and distribute the Textbook
in the following languages in addition to English (If Spanish
or other rights are specified, TPR will be obligated to obtain
such rights for all Third Party Materials, as stated in
Section VIII.C of the Master Agreement):
Spanish/Other (specify)/English only
(6) TOTAL PROJECT FEE: Insert the total Project Fee or Budget for
the Project, including payment dates or events; attach
additional pages, if needed. Unless otherwise noted, half
payment will be made at the start of the project, and half on
acceptance.
Total Project Fee:
(7) LICENSED THIRD-PARTY MATERIALS: Describe the nature, sources,
and cost of any Third Party Materials that TPR will be
licensing under Section VIII of the Agreement:
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Under Section VIII.E, EPG will pay the cost of the Third Party
Materials
_____ directly to the Third Party (identify):
_____ to TPR, which will pay the Third Party.
(8) SPECIAL PROVISIONS: Describe any other special provisions, if
necessary:
EPG TPR:
Division:
By: ____________________________ By: ____________________________
Title: __________________________ Title: ___________________________
Date: __________________________ Date: ___________________________
Note: Please provide the EPG Contracts, Copyrights & Permissions
Department with other relevant documentation such as correspondence
exchanged between the parties, any "Request for a Proposal" issued by
EPG, or any Proposal or Response to Proposal, or Bid issued by TPR when
submitting a Contract Request Form for this Project Agreement.
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35
Exhibit C: Sample Change Order
This is a CHANGE Order to a PROJECT AGREEMENT between the Educational and
Professional Publishing Group of The XxXxxx-Xxxx Companies, Inc. ("EPG") and
Princeton Review Publishing L.L.C. ("TPR") under a Master Agreement dated
_____________ 1998, between EPG and TPR (the "Master Agreement"). Any
capitalized term (or grammatical variant of it) in this Change Order has the
same definition as does that term in the Master Agreement.
This Change Order affects the following Project Agreement:
Date: __________________________________
EPG Division: ___________________________
Title of Program/Textbook:__________________
Insert a description of the material changes in TPR's services or TPR Materials,
for example, any change in the scope of services to be provided by TPR,
Deliverables, scheduled delivery dates, amount and dates of payment of Total
Project Fee, etc. Attach Additional Page(s), if necessary.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
I) SCOPE OF CHANGE: (TPR services or materials to be added or deleted)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
II) COMPENSATION OR PAYMENT SCHEDULE:
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
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36
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
III) OWNERSHIP RIGHTS:
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
IV) OTHER SUBSTANTIAL CHANGES:
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
EPG: TPR:
Division:
By: ____________________________ By: ____________________________
Title: __________________________ Title: ___________________________
Date: __________________________ Date: ___________________________
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Exhibit D: Excluded Materials
Sales of the following materials are excluded from the calculation of royalties
under Section V.D. l of the Agreement:
SCHOOL DIVISION
*
GLENCOE/XXXXXX-XXXX
SOCIAL STUDIES
*
LANGUAGE ARTS
*
SCIENCE
*
MATH
*
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Exhibit E: List of Licensed Trademarks
A list of Trademarks, service marks and logos which are cross-licensed under the
Agreement between EPG and TPR.
"TPR MARKS" LICENSED TO EPG:
THE PRINCETON REVIEW
"EPG MARKS" LICENSED TO TPR:
EPG Marks:
Corporate:
XxXxxx-Xxxx
XxXxxx-Xxxx logo THE XXXXXX-XXXX COMPANIES
The XxXxxx-Xxxx Companies, Inc.
The Educational and Professional Publishing Group of the XxXxxx-Xxxx
Companies, Inc.
Glencoe Marks:
Glencoe
Glencoe/XxXxxx-Xxxx/
Mindjogger
SRA Marks:
SRA
SRA/XxXxxx-Xxxx
Science Research Associates
SRA logo
Open Court
OC Design (Open Court)
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School Division:
School Division
Math in My World
Marks may be added or deleted from this Exhibit during the term of the Agreement
with written notice.
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AGREEMENT BETWEEN
THE EDUCATIONAL AND PROFESSIONAL PUBLISHING GROUP,
A UNIT OF THE XXXXXX-XXXX COMPANIES, AND
THE PRINCETON REVIEW
TABLE OF CONTENTS
I. DEFINITIONS......................................................1
II. THE PARTIES' PERFORMANCE OBLIGATIONS.............................3
III. DEVELOPMENT OF THE ONLINE PRODUCT................................5
IV. PROJECT AGREEMENTS AND PROJECT MANAGERS..........................5
V. PAYMENT FOR PROJECTS AND ROYALTIES...............................7
VI. AUDITING........................................................11
VII. COPYRIGHT AND LICENSES..........................................11
VIII. LICENSED THIRD-PARTY MATERIALS..................................13
IX. TRADEMARK LICENSES..............................................14
X. TRADEMARK IDENTIFICATION; CREDIT................................16
XI. TRADEMARK QUALITY, INSPECTION AND APPROVAL......................16
XII. FAILURE TO PUBLISH; REVERSION OF RIGHTS.........................17
XIII. TERM AND TERMINATION............................................18
XIV. REPRESENTATIONS AND WARRANTIES..................................21
XV. INDEMNIFICATION.................................................22
XVI. NON-COMPETITION.................................................23
XVII. CONFIDENTIAL INFORMATION........................................24
XVIII. MISCELLANEOUS...................................................26
41
Exhibit A: Question Pool Schedule.......................................29
Exhibit B: Sample Project Agreement.....................................31
Exhibit C: Sample Change Order..........................................35
Exhibit D: Excluded Materials...........................................37
Exhibit E: List of Licensed Trademarks..................................39
