EXHIBIT 10.20
AMENDED AND RESTATED LICENSE AGREEMENT
THIS AMENDED AND RESTATED LICENSE AGREEMENT ("Agreement") is made and
entered into as of the 26th day of March, 1999 (the "Effective Date") by and
between THE SPORTS AUTHORITY, INC., a corporation organized and existing under
the laws of the State of Delaware, United States of America ("U.S.A.") with its
principal place of business at 0000 Xxxxx Xxxxx Xxxx 0, Xxxx Xxxxxxxxxx, Xxxxxxx
00000, U.S.A., and THE SPORTS AUTHORITY MICHIGAN, INC. a corporation organized
and existing under the laws of the State of Michigan with its principal place of
business at 000 Xxxxx Xxxxxxxxxx, Xxxxx 000, Xxxxx Xxx, Xxxxxxxx 00000, X.X.X.
(collectively, "Licensor"), and MEGA SPORTS CO., LTD., a corporation organized
and existing under the laws of Japan, with its principal office at 0-0-0,
Xxxxxx, Xxxxxx-xx, Xxxxx-xxx, Xxxxx-xxx, 000, Xxxxx ("Licensee").
WHEREAS, Licensor is the largest full line retailer of sporting goods
and equipment, apparel and footwear in the U.S.A. and operates THE SPORTS
AUTHORITY stores in the U.S.A. and Canada;
WHEREAS, JUSCO Co., Ltd., a well-known Japanese retailer, and The
Sports Authority, Inc. agreed under a certain JOINT VENTURE AGREEMENT dated
January 19, 1995, as amended by a FIRST AMENDMENT TO JOINT VENTURE AGREEMENT
between the same parties, dated September 6, 1996 (collectively, the "JVA") to
form the company Mega Sports Co., Ltd. to develop and operate the TSA Stores (as
defined below) in Japan;
WHEREAS, The Sports Authority, Inc. and Mega Sports Co., Ltd. entered
into a certain LICENSE AGREEMENT dated August 1, 1995 under which The Sports
Authority, Inc. granted to Mega Sports Co., Ltd. the exclusive right to use in
Japan the Marks and Technology (as defined below) (the "License Agreement");
WHEREAS, certain intellectual property rights of The Sports Authority,
Inc. in Japan, including the Marks were recently assigned by The Sports
Authority, Inc. to its wholly-owned subsidiary, The Sports Authority Michigan,
Inc., and the latter is now the proprietor of the Marks in Japan.
WHEREAS, The Sports Authority, Inc. and JUSCO Co., Ltd. have agreed to
restructure their joint venture, resulting in a certain AMENDED AND RESTATED
JOINT VENTURE AGREEMENT dated March 12, 1999, which replaces the JVA in its
entirety;
WHEREAS, in view of the foregoing, The Sports Authority, Inc., The
Sports Authority Michigan, Inc. and Mega Sports Co., Ltd., desire by this
Agreement to amend, replace in its entirety and terminate the License Agreement
as of the Effective Date;
NOW, THEREFORE, in consideration of the mutual promises, undertakings
and covenants herein, and for other valuable consideration, the receipt and
sufficiency of
which is hereby acknowledged, the Parties hereby respectively grant, covenant
and agree as follows:
ARTICLE I
DEFINITIONS
1.1 "Affiliated Companies" or "Affiliate Company" shall mean any legal entity or
partnership which holds directly or indirectly more than ten percent (10%) of
JUSCO Co., Ltd. or The Sports Authority, Inc., or of which JUSCO Co., Ltd. or
The Sports Authority, Inc., or any of their Related Companies (as defined below)
directly or indirectly own or control more than five percent (5%) and up to and
including fifty percent (50%) of the issued share capital or capital stock, in
any event not to include Licensee. For purposes of this definition, JUSCO Co.,
Ltd., on the one hand, and The Sports Authority, Inc., on the other, and each of
their respective Affiliate Companies shall in no event be deemed to be an
Affiliate Company of the other Party or its Affiliate Companies.
1.2 "Business Day(s)" shall mean a day, excluding Saturday, in which the banks
in both New York and Tokyo are open for business.
1.3 "Business Travel Expenses" shall mean business or executive class airfare
for officers and managers of Licensor, and for Licensor employees below officer
level if the expected duration of an international trip is for ten (10) or fewer
calendar days, and coach class for all others below manager level (with all
airfares within a class of travel to be at the lowest fare for the route with
the least number of stops), reasonable business hotel accommodations, meals and
transportation within the U.S. or Japan, and other reasonable out of pocket
expenses, in accordance with Licensor's policies.
1.4 "Fiscal Year" shall mean Licensee's fiscal year. Licensee shall give at
least ninety (90) days advance notice to Licensor of any change in designation
of Licensee's Fiscal Year.
1.5 "Gross Sales" shall mean the total sales revenues (net of any discounts
issued at Licensee's cash registers), received for merchandise and services
furnished at, by or through the TSA Stores by Licensee, its Subsidiaries, any
Affiliated Companies and Related Companies and any tenants or permitted
sublicensees, whether by Licensee, its Subsidiary Companies, tenants or
permitted sublicensees, whether for cash or on credit, except that the following
shall be excluded in calculating Gross Sales: (i) sales of merchandise
subsequently returned for refund or credit; and (ii) value added taxes,
consumption taxes and any other similar taxes imposed by governments, excluding
withholding taxes, if any. Gross Sales shall be calculated net of any allowances
given with respect to defective merchandise.
1.6 "Licensed Property" shall mean the Marks and the Technology.
1.7 "Marks" shall mean:
(a) the xxxx THE SPORTS AUTHORITY in English in block letters and any
equivalent in Japanese characters, and certain THE SPORTS AUTHORITY logotypes,
and such other trademarks and service marks, which are proprietary to Licensor,
as shall be identified in writing by Licensor from time to time, together with
associated copyright works and designs, all as more specifically described in
EXHIBIT "A", attached hereto and incorporated herein, as EXHIBIT "A" may be
modified from time to time in writing by Licensor;
(b) all related emblems, logos and symbols, and all combinations, forms
and derivations thereof as are currently or hereafter used by Licensor in
connection with the Products (as defined below); and
(c) the Trade Dress (as defined below) inherent in the design, layout
and presentation of THE SPORTS AUTHORITY stores in the U.S.A. and Canada,
including, without limitation, such Trade Dress as may be subject to protection
under the laws of Japan on industrial models and designs.
1.8 "Materials" shall mean exterior and interior signs, flags, banners,
packaging, labels, print, electronic and broadcast advertising and promotional
media, manuals, brochures, flyers, posters, sales literature, business forms,
gift certificates, credit cards, debit cards, membership or consumer loyalty
program cards, stationery, employee uniforms, badges, store bags and boxes,
baskets, trolleys and carts, sales receipts and charge slips, tickets and tags,
and the like, bearing any of the Marks and used on or in connection with the
Products or Services (as defined below) or the TSA Stores.
1.9 "Party" shall mean the Licensor or Licensee; "Parties" shall mean both of
them.
1.10 "Products" shall mean any and all products bearing or otherwise sold under
or in connection with the Marks as permitted hereunder, as well as packaging and
labeling for such Products, subject always to Licensor's prior written approval
and instructions concerning private label merchandising as contemplated herein.
1.11 "Related Company" or "Related Companies" shall mean any legal entity which
holds directly or indirectly more than fifty percent (50%) of the issued share
capital or capital stock of JUSCO Co., Ltd. or The Sports Authority, Inc., or of
which JUSCO Co., Ltd. or The Sports Authority, Inc. or their parent companies
hold directly or indirectly more than fifty (50%) of the issued share capital or
capital stock, in any event not to include Licensee. An entity shall be deemed
to hold shares indirectly if the shares are held by another entity that is
majority controlled, either directly or through other majority controlled
entities, by such first mentioned entity. "Control," as used herein, refers to
actual voting control, whether by ownership of a majority of the voting
securities of an entity, by agreement, or otherwise.
1.12 "Royalties" shall mean the following:
PERIOD ROYALTY RATE
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In Fiscal Year 1999 ONE PERCENT (1.0%) of any and all Gross Sales.
In Fiscal Year 0000 XXX and ONE TENTH of ONE PERCENT (1.1%) of any and all Gross Sales.
In Fiscal Year 2001 ONE and TWO TENTHS of ONE PERCENT (1.2%) of any and all Gross Sales.
In each subsequent Fiscal Year
during the Term and any Renewal Term ONE and TWO TENTHS of ONE PERCENT (1.2%) of any and all Gross Sales.
The Royalties may be reviewed from time to time to insure that they are
commensurate with the income derived by Licensee from use of the Licensed
Property and may be amended only by mutual written agreement of the Parties.
1.13 "Services" shall mean those services offered in the TSA Stores, including,
without limitation, operation of retail sporting goods and equipment, athletic
and leisure footwear and apparel stores, sporting goods repair and maintenance,
racquet stringing, layaway, and such other services as Licensor offers in its
THE SPORTS AUTHORITY stores in the U.S.A. and Canada.
1.14 "Subsidiary(ies)" shall mean any company wholly-owned or controlled by
Licensee.
1.15 "Technology" shall mean (i) information that is related to the development,
design, layout, construction, store fixturing, decoration, equipping, furnishing
and all know-how necessary to the installation, management and operation of the
TSA Stores under The Sports Authority system and other information and know-how
which Licensor possesses and has the right to transfer and license to Licensee
for the aforesaid purposes; (ii) drawings, purchased parts and material
specifications, application data, bills of material, controls procedures,
construction, decor and equipment procedures, test procedures, performance
information, quality control standards, merchandise specifications, reliability
standards, and other written documents that are possessed by Licensor that
relate to the information described in (i) above to Licensee. Any information,
item or material enumerated in (i) or (ii) above, which shall have been
developed or created exclusively by Licensee after the date hereof in connection
with the installation, management and operation of its TSA Stores in the
Territory (as defined below), which is clearly identifiable as such and does not
infringe upon and is not based upon or derived from the Licensed Property,
Products, Materials or Services, as evidenced by written documentation to the
satisfaction of Licensor, shall be the property of Licensee and shall not be
treated as owned by Licensor.
Notwithstanding anything to the contrary in the foregoing, the TSA Computer
Systems (as defined below) are hereby excluded from the Technology for purposes
of this Agreement.
1.16 "Term" shall mean the period commencing with the Effective Date and
continuing approximately six (6) years through January 31, 2005 unless this
Agreement is otherwise renewed or earlier terminated as provided in Article 4.8
below.
1.17 "Territory" shall mean Japan.
1.18 "TSA Computer Systems" shall mean applications software and know-how
related to: (a) purchase order processing and inventory management; (b)
replenishment (or E-3); (c) point of purchase signs for the TSA Stores; (d)
store receiving; (e) retail stock ledger; (f) accounts payable (Xxxxxx Software
Package); (g) general ledger (Xxxxxx Software Package); (h) fixed asset ledger
(Xxxxxx Software Package); (i) store physical inventory; (j) cash register
system (point of sales); and amendments, modifications, enhancements, upgrades
and updates to the same.
1.19 "TSA Stores" shall mean any sporting goods retail outlet established and/or
operated by Licensee in the Territory and consisting of more than 10,000 square
feet (or approximately 900 square meters) of gross indoor floor space primarily
devoted to the sale of a broad assortment of sporting goods and equipment,
footwear and apparel, and to provision of the Services.
1.20 "Trade Dress" shall mean the total look or appearance of a private label
product or its packaging or the design or shape of the private label product
itself, as well as the total look, appearance, design and layout of THE SPORTS
AUTHORITY stores as operated by Licensor in the U.S.A and Canada.
ARTICLE II
TRADEMARK AND SERVICE XXXX LICENSE
2.1 GRANT OF LICENSE. Subject to the terms and conditions set forth in this
Agreement, Licensor hereby grants to Licensee, for the Term and any Renewal Term
only, and Licensee accepts from Licensor, upon the terms and conditions
specified herein, the nontransferable exclusive right and license in the
Territory only, to use the Marks on and in connection with the Products,
Materials and Services furnished in or in connection with the TSA Stores if, and
only if, such Products, Materials and Services comply with the quality standards
set forth herein and those approved and issued by Licensor from time to time.
Licensor shall monitor and control the nature and quality of the Products,
Materials and Services, and Licensor may appoint one or more representatives to
monitor and exercise such control on Licensor's behalf. Such monitoring shall in
no way lessen or limit Licensee's obligation to use the Marks only as set forth
herein. No other, further or different license is granted or implied and no
assignment of any right or interest is made or intended herein. In particular,
no license is granted to permit any third party to use the Marks, and Licensee
may only use the Marks on or in connection with Products, Materials and Services
subject to Articles 2.2 and 2.3 and other terms and conditions hereof. Further,
Licensee is prohibited from using the Marks or any name or xxxx confusingly
similar to the Marks, including any abbreviations of the Marks, as part of its
registered corporate or business name, or as part of any Internet domain name.
2.2 MARKING, SAMPLES, INSPECTION, QUALITY CONTROL.
(a) Licensee agrees to xxxx all Products and Materials in a manner
complying with the provisions of EXHIBIT "B", attached hereto and incorporated
herein. Licensor reserves the right to change the provisions of EXHIBIT "B" as
it sees fit and such changes shall become binding upon Licensee upon receipt of
written notice of such changes. Licensee shall have a reasonable period, but no
more than ninety (90) days from first notice, to fully implement such changes.
(b) At any time upon request of Licensor, and prior to introducing any
Product bearing or embodying the Marks for sale or prior to producing and
publishing or distributing any Materials for the first time, Licensee shall
furnish at Licensee's expense samples of such Products and Materials on or in
connection with which any Xxxx is used or proposed to be used, including the
trademark or copyright notices thereon and any other labels, tags or markings.
Further, if Licensee proposes to alter the Marks in any way or to deviate in any
way from the forms in which the Marks are registered in Japan, Licensee shall
first submit a sample of the proposed altered Xxxx to Licensor for Licensor's
prior review and written approval.
Licensor shall review in a timely manner all such samples and requests and use
its best efforts to communicate in writing its approval or disapproval as soon
as practicable after receiving the same. Failure to communicate approval within
fifteen (15) Business Days of receipt of the same shall be deemed a disapproval.
In no event, however, shall Licensee distribute or offer for sale the proposed
Products or Materials or use the altered Marks until approval of the applicable
sample is granted in writing by Licensor. Licensee specifically agrees to amend
to the satisfaction of Licensor any sample of Products (including packaging and
labels) or Materials or any proposed alterations of the Marks as may be directed
by Licensor. A further sample shall be provided to Licensor for its prior review
and written approval if any subsequent changes are made in approved Products or
Materials or in the Marks. To the extent practicable, Licensor and Licensee
shall cooperate in good faith in developing standard manuals or procedures
setting forth approved formats for packaging and labels for Products, and
approved formats for Materials. Once established, Licensee shall fully comply
with such manuals or procedures and submit for Licensor's review and approval
any material deviation from such manual or procedures in the manner provided
herein.
(c) Licensee acknowledges that Licensor maintains high standards for
products and services sold by and through it's THE SPORTS AUTHORITY stores in
the U.S.A. and Canada. Further, Licensee acknowledges that Licensor maintains
high standards for its products and services, as expressed in Licensor's Mission
Statement, attached hereto as EXHIBIT C and as may be amended from time to time
by Licensor (the "TSA Mission Statement"). Licensee agrees to maintain the
quality of the Products, Services and Materials sold or distributed by it
pursuant to this Agreement, and the nature and quality of Licensee's use of the
Licensed Property, in conformity with the TSA Mission Statement and as expressed
in standards communicated by Licensor to Licensee from time to time. Further,
Licensee warrants that all Products, Services and Materials shall continue to
meet or exceed such standards. Further, Licensee shall use
its best efforts to ensure that (a) all Products, Services and Materials comply
with the requirements of this Article II and all applicable laws, rules and
regulations and (b) neither the Products or the manufacturing thereof violates
or infringes any right of any third party or the human rights of any person
employed to manufacture the same.
(d) In the event Licensee wishes to materially reduce the quality of an
existing Product or Service, Licensee shall advise Licensor in writing of the
description of such Product or Service and the proposed revised quality standard
well in advance of any such proposed change. Licensor's failure to advise
Licensee in writing of Licensor's approval of such proposed change within thirty
(30) days of receipt of notice from Licensee, shall be deemed a disapproval.
(e) Upon Licensor's request, Licensee shall furnish or make available
to Licensor a reasonable number of representative samples of the Products,
Services and Materials to permit Licensor to determine that such Products,
Services and Materials meet the quality standards set forth herein. The costs
associated with the submission and shipping of such samples shall be borne by
Licensee. Licensor shall have the right to inspect the TSA Stores during normal
business hours to assure compliance with the quality standards established by
Licensor. If so notified in writing by Licensor, Licensee shall not offer or
provide any Products, Services and Materials whose nature or quality does not
comply with the quality standards established by Licensor.
(f) Licensee shall inform Licensor of, and Licensor shall have the
right to attend at its expense, all annual line reviews of the Products.
Further, to ensure compliance with Licensor's standards and instructions
relating to the Licensed Property, Licensor, at its expense, directly or through
representatives, may inspect the TSA Stores and may inspect and test Products,
Services and Materials from time to time. Such inspection may include, without
limitation, taking photographs or recording videotapes or the like inside and
outside of the TSA Stores. Licensee shall reasonably cooperate and aid Licensor
in making such inspections and tests.
(g) Without limiting or waiving Licensor's rights, Licensor delegates
in part to Licensee the continuing duty to exercise quality control regarding
the nature and quality of the Materials, Products and Services and the nature of
Licensee's use of the Marks. Licensor may recommend and Licensee shall adopt and
comply with any reasonable procedures, tests, surveys or the like to fulfill
this delegation. Licensor may request reports, documentation, evidence or other
proof of Licensee's performance under this provision and Licensee shall promptly
furnish the same to Licensor.
(h) Licensee shall reimburse Licensor for the Business Travel Expenses
incurred by Licensor's personnel in connection with trips undertaken at
Licensee's request or for purposes of meetings with Licensee in connection with
this Agreement where the need for such meeting is mutually agreed upon.
2.3 FURTHER TERMS OF LICENSE.
(a) Nothing contained herein shall prevent or restrict Licensor or
parties licensed by Licensor from manufacturing, marketing or selling products
bearing or under any marks other than the Marks (it being understood that the
license granted herein extends only to the Marks and no other marks). Licensee
acknowledges and agrees that Licensor may enter into license agreements with
others involving use of the Marks, provided and to the extent that such
agreements do not conflict with the express terms of this Agreement granting to
Mega Sports Co., Ltd. certain exclusive rights to use the Marks and Technology
in Japan.
(b) Licensee shall use its best efforts to sell the Products and
Services and to exploit the rights herein granted throughout the Territory
consistent with the high standards and prestige represented by the Marks.
(c) Except for one time, individual item (not bulk) purchases in the
TSA Stores for export from and after purchase in Japan for personal use by the
subject purchaser, Licensee shall not export Products from the Territory or sell
Products to any person or entity which it knows or has reason to believe intends
to export Products from the Territory. Licensee acknowledges and agrees that the
sale or marketing of Products or Services by it or by persons authorized by it
outside of the Territory will materially damage Licensor and its relationships
with other licensees, and that, accordingly, any such sales shall be deemed a
material breach of this Agreement.
(d) Licensor and Licensee acknowledge that they are interested in
extending their businesses outside of the physical locations of their respective
TSA Stores to include, without limitation, mail order retail services and
electronic commerce conducted via the Internet (that is, alternative sales
channels). The Parties acknowledge that technologies and other means of
exploiting such alternative sales channels are undergoing rapid and continuous
change. The Parties acknowledge that in utilizing such alternative sales
channels, Licensee is interested and willing to target only consumers within the
Territory, to use only the Japanese language in all of its consumer
communications, to restrict the shipment or delivery of Products and Services to
consumers within the Territory, and to use only communications systems located
within the Territory. The Parties also acknowledge that Licensor has no interest
in targeting consumers in the Territory through such alternative sales channels.
The Parties also acknowledge that there may be opportunities to share and a need
to coordinate technologies, methods, procedures and systems in the
implementation of such alternative sales channels. Finally, the Parties
acknowledge their mutual interest in Licensee using the Licensed Property to
maximize its Gross Sales within the Territory, including, in the future, through
expansion of Licensee's business to include utilization of such alternative
sales channels within the Territory. This Agreement does not permit Licensee to
utilize such alternative sales channels within the Territory. Further, as of the
Effective Date, Licensee has no definitive plans or proposals concerning for
Licensor to evaluate concerning utilization of such alternative sales channels
within the Territory. However, the Parties agree to discuss and negotiate in
good faith at such times as Licensee has developed any definitive proposals
concerning utilization of such alternative sales channels within the Territory.
Such expansion is subject to the
negotiation and execution by the Parties of a definitive written amendment of
this Agreement, containing terms and conditions mutually acceptable to Licensee
and Licensor.
ARTICLE III
TECHNOLOGY LICENSE
3.1 GRANT OF LICENSE.
(a) Subject to the terms and conditions of this Agreement and to the
applicable laws and any contrary restrictions in other agreements regarding the
use of the Technology, and to the extent that it can lawfully do so, Licensor
grants to Licensee, during the Term and any Renewal Term only, and Licensee
accepts from Licensor, upon the terms and conditions specified herein, an
exclusive, nontransferable right and license in the Territory only, to use the
Technology in connection with establishment and operation of the TSA Stores.
(b) Nothing in this Agreement shall be deemed to grant to Licensee any
right which is of a more extensive nature than is possessed by Licensor, or
which is of any greater extent than that which Licensor has lawful right to
provide or grant to Licensee without incurring liability or obligations to
others, and the rights herein granted are subject to any rights of, and any
conditions imposed by, third parties. No other, further or different license is
granted or implied and no assignment of any right or interest is made or
intended herein. In particular, no license is granted to permit any third party
to use the Technology.
(c) Licensee shall not use any Technology for any purpose other than
the development and operation of the TSA Stores. All Technology shall remain the
sole and exclusive property of Licensor, and neither Licensee nor any other
person or entity shall acquire any rights in the Technology except those rights
specifically granted to Licensee under this Agreement.
3.2 CONFIDENTIALITY AND SECRECY. Licensee shall keep confidential and take all
necessary precautions to ensure the strict confidentiality of the Technology and
any other information of Licensor of a proprietary or confidential nature
("Confidential Information"), other than that Confidential Information which:
(a) is or comes (other than by disclosure by Licensee in breach of its
obligations hereunder) into the public domain; or
(b) is received in good faith by Licensee from a third party owing no
duty of confidence to Licensor and Licensee is not similarly bound to such third
party to keep such information confidential.
In particular, and without limiting the foregoing, Licensee shall not disclose
any Confidential Information to any Affiliated Company or Related Company unless
and only to the extent it is necessary to be disclosed by Licensee in the
ordinary course of sale of the Products, operation of the TSA Stores or
furnishing of the Services, and unless such Affiliated Company or Related
Company agrees to be bound by this same provision regarding confidentiality and
secrecy.
3.3 Licensee's confidentiality obligations as set forth in this Article III
shall continue in full force and effect notwithstanding expiration or
termination of this Agreement for any reason.
ARTICLE IV
GENERAL PROVISIONS
4.1 PAYMENTS. Beginning with the Effective Date, during the initial Term and any
Renewal Term, and if applicable, after termination of the Agreement to the
extent any amounts are accrued and unpaid, Licensee shall pay the Royalties to
Licensor in the manner and at the times specified below.
4.2 REPORTS; ROYALTIES.
(a) Within fortyfive (45) days after the end of each fiscal quarter of
Licensee, Licensee shall:
(i) Deliver to Licensor a report, certified by one of its
corporate officers, giving the following particulars
concerning Gross Sales during the preceding fiscal quarter of
Licensee, together with documentary proof of payment of any
withholding tax (including, without limitation, original
receipts or certificates evidencing payment of such taxes):
(A) Identification and location of TSA Stores which were
open for business during the fiscal quarter of
Licensee;
(B) Gross Sales of each such TSA Store;
(C) Amount of Royalties due Licensor with respect to each
TSA Store and in the aggregate; and
(D) Amount of withholding tax withheld and paid to tax
authorities.
(ii) Pay to Licensor the Royalties due for the quarter covered by
such report, in U.S. Dollars, in immediately available funds,
by international bank draft or as otherwise directed by
Licensor. The exchange rate calculation shall be made as of
the last day of the subject fiscal quarter of Licensee in
accordance with the U.S. Dollar buy rate (Late New York
foreign exchange) as published in the XX Xxxxxx Index for U.S.
Dollar which
appears in THE WALL STREET JOURNAL, U.S. edition on the
following Business Day. Receipt or acceptance of any report or
payment shall not preclude Licensor from questioning the
correctness thereof at any time. In the event that any
inconsistency or mistake is discovered by either Licensor or
Licensee in such reports or payments, it shall be immediately
rectified and, within fifteen (15) Business Days, the
appropriate report and payment shall be made.
(b) Time is of the essence with respect to Licensee's duty to make all
payments when due and Licensee's obligations to make such payments are absolute,
unconditional and not subject to any right of reduction or set-off, except for
withholding taxes imposed on the Royalties which Licensee is required by law to
withhold. Licensee shall withhold and pay in a timely manner such taxes to the
proper tax authority at the rate required by statute but reduced to the fullest
extent as permitted by tax treaty, and Licensee shall provide Licensor with
official receipts of all withholding tax payments sufficient to enable Licensor
to claim appropriate federal income tax credits. Without limiting the foregoing,
Licensee shall pay to Licensor interest at the rate of the lesser of (i) one and
one half percent (1.5%) per month, compounded monthly, or (ii) the maximum rate
allowed by applicable law, on so much of the Royalty as remains outstanding from
time to time beyond the period for payment set forth above. Written notice by
Licensor to Licensee as to any amount of the Royalty (including interest) shall
be PRIMA FACIE evidence that said amount is unpaid as of the date of such
notice.
(c) Licensee shall respond in writing to any written inquiry from
Licensor with respect to any report or payment within fifteen (15) Business Days
of receipt thereof.
(d) If, in the course of an audit or inspection by Licensor or its
representative(s), any discrepancy shall appear with respect to any amount due
and payable by Licensee and the amount paid, the amount owed (including interest
computed as set forth in Article 4.2(b) above) shall be paid within fifteen (15)
Business Days after Licensee's receipt of notice of any such discrepancy.
(e) Within ninety (90) days after the end of each Fiscal Year of
Licensee, Licensee shall furnish Licensor a certificate from an independent
certified public accountant as to the accuracy of Licensee's Royalty payments
and reports for each such Fiscal Year.
4.3 BOOKS AND AUDITS.
(a) Licensee shall keep full, true and accurate books of account in
conformance with generally accepted accounting principles in effect in the
Territory and containing all particulars which may be necessary for the purpose
of reviewing Gross Sales and computing the Royalties due and payable to
Licensor. Said books of account shall be kept at Licensee's principal place of
business and maintained by Licensee for a period of at least three (3) years
following the end of each subject year during the Term and any Renewal Term and
shall be available for inspection by Licensor.
(b) Licensee shall maintain accurate records of all sales of Products
and Services bearing the Licensed Property and of its annual advertising and
promotional expenditures and shall make them available to Licensor for use in
enforcing, registering or protecting the Licensed Property in Japan and
elsewhere.
(c) During the Term, any Renewal Term and for a period of three (3)
years after expiration or termination of this Agreement, Licensor or an
independent certified public accountant retained by Licensor may audit all
statements of account, records and reports provided for in this Agreement, at
least once per Fiscal Year of Licensee. Licensee shall make available to
Licensor or said certified public accountant for the purposes of this paragraph
any and all records reasonably necessary to the verification of such reports.
Any error(s) discovered by such audit shall be corrected by Licensee within
fifteen (15) Business Days after having been notified of such error. The
expenses of any and all such audits and inspections shall be borne by Licensor.
However, if the error discovered represents an underpayment by Licensee of more
than three percent (3%) of the Royalties due for the Fiscal Year in question,
Licensee shall promptly reimburse Licensor for the reasonable costs of such
audit.
4.4 REPRESENTATIONS, WARRANTIES AND DUTIES OF LICENSEE. Licensee represents and
warrants to Licensor and agrees that:
(a) Licensee has full right, power and authority to enter into this
Agreement and to perform all of its obligations hereunder.
(b) Licensee shall use its best efforts on a continuous basis during
the Term to promote the Products and the Services in the Territory; to exercise
all reasonable care and skill in the performance of such duties; to review and
progressively improve its Gross Sales in the Territory; and to observe, protect
and enhance the distinctive THE SPORTS AUTHORITY image as communicated by
Licensor. In particular, and without limiting the foregoing, Licensee shall
expend a minimum of two percent (2.0%) of the Gross Sales of the TSA Stores per
Fiscal Year to advertise and promote the TSA Stores and the Products and
Services, including, without limitation, expenditures for customer loyalty
programs, grand opening advertising and promotions and vendor cooperative
advertising moneys paid in the same period.
(c) The license granted herein is subject to and Licensee represents
and warrants that all Services furnished by it and all Products, Services and
Materials bearing or offered under the Licensed Property shall be of a nature
and quality which are consistent with the high standards of quality and
excellence established by Licensor over the years in the U.S.A. and Canada with
respect to the Licensed Property and with respect to Licensor's operation of THE
SPORTS AUTHORITY stores in the U.S.A. and Canada. Licensee shall fully comply at
its sole cost and expense with any and all quality standards set forth herein
and that Licensor may set forth from time to time with respect to the Licensed
Property and the Products and Materials and Services bearing or embodying the
Licensed Property.
(d) Licensee shall be completely responsible for the payment of all
moneys which may be due at any time to its own employees, contractors, vendors,
agents and representatives, and for all other claims made by such parties.
Licensor shall not for any reason be liable in any way for Licensee's
termination of employment or other relationships with such parties or other
legal entities, nor for any goods or services furnished to Licensee by Licensor
or any third party or by Licensee to Licensor or any third party.
(e) Except with respect to trademark and service xxxx applications and
registrations, recording of this Agreement and related registered user
agreements, all of which are reserved exclusively to Licensor, Licensee shall,
at its own expense, secure any and all approvals, licenses, registrations and/or
permits required under the laws or regulations of any governmental or similar
entity having jurisdiction over Licensee or the TSA Stores, or over the
shipment, export, import, sale or other distribution of Products or provision of
Services within Japan as these relate to operation of the TSA Stores, including,
without limitation, compliance with all export and import control regulations
and applicable consumer product and health and safety laws and the like. Nothing
in this Agreement shall be construed to require Licensor or Licensee to perform
any act in violation of such laws or regulations.
(f) Licensee shall, during the Term, any Renewal Term and for one (1)
year following expiration or termination of this Agreement, ensure the adequate
provision of after sales service and spare parts to consumers in the Territory,
subject to the continued operation of Licensee as a retail entity and the
reasonable cooperation of Licensor to assist Licensee in obtaining access to
spare parts.
(g) Licensee agrees and acknowledges that in the Territory and
throughout all the world all right, title, interest and ownership in and to the
Licensed Property, and present and future registrations thereof, as trademarks,
service marks, trade names, trade dress, copyright works, industrial models,
designs, and the like, are and shall remain in Licensor and Licensee agrees to
render all reasonable assistance in maintenance of these rights. Further,
Licensee agrees and acknowledges that all goodwill associated with or created by
use of the Licensed Property by Licensee has inured and shall continue forever
to inure to the benefit of Licensor. Upon termination of this Agreement all
rights in and to the Licensed Property, including all right to the use thereof,
and all goodwill associated with use of the Licensed Property, shall thereupon
revert back to Licensor and Licensor shall thereafter enjoy those rights as if
this Agreement had never been executed. If, by operation of law or otherwise,
any goodwill associated with Licensee's use of the Licensed Property shall be
deemed to accrue or have accrued to Licensee, Licensee agrees to immediately and
irrevocably assign without condition such goodwill to Licensor. No party shall
be required to compensate the other for reversion or assignment of the goodwill.
(h) Licensee agrees that it shall not sell, distribute or otherwise
make available or permit any use of the Licensed Property on or in connection
with Products,
Materials or Services, outside of the TSA Stores, whether inside or outside the
Territory, and that it shall cooperate with Licensor in preventing all such
sales and distribution by others. Before permitting any vendor or supplier to
sell off or otherwise dispose of surplus, defective or returned Products to
parties other than Licensee, Licensee shall require the vendor or supplier to
remove all of the Licensed Property from such Products.
(i) Licensee shall not attack or impair or put at issue Licensor's
rights in the Licensed Property, or any of Licensor's applications or
registrations therefor, nor assist anyone else in doing so. Except as licensed
hereunder, Licensee shall not use or apply to register the Licensed Property or
any identical or deceptively or confusingly similar service marks, trademarks,
trade names, trade dress, copyrights, industrial models or designs, or any
derivations thereof, during the Term, any Renewal Term and forever hereafter.
Further, Licensee shall not use the Licensed Property in any manner likely to
jeopardize the exclusiveness or distinctiveness of the Licensed Property or
Licensor's proprietorship thereof, and Licensee shall not register or attempt to
register its rights in the Marks as granted hereunder.
(j) Licensee shall use the Licensed Property strictly in compliance
with the legal requirements of the Territory and shall use such markings as are
required by law and by Licensor herein.
(k) Licensee agrees that it shall not, during the Term and any Renewal
Term or thereafter, register or apply to register any of the Marks or any logos
or trademarks or service marks similar thereto anywhere in the world. Without
limiting the foregoing, upon and after the expiration or termination of this
Agreement, Licensee, upon Licensor's request, shall execute such documents as
may be necessary to further confirm Licensor's rights in the Marks. Licensee
hereby appoints Licensor as its attorney-in-fact for the purpose of executing
such documents.
(l) Any copyright which may exist or be created in any materials
provided by Licensor hereunder including, without limitation, any sketch,
design, drawing, print, packaging, label, tag or the like designed or approved
by Licensor shall be the property of Licensor. Licensee shall not, at any time,
do or suffer to be done any act or thing which may adversely affect any rights
of Licensor in such sketches, designs, packaging, labels, tags and the like,
including, without limitation, disclosing such information or filing any
application in Licensee's name to record any claims to copyrights in Licensed
Property, and Licensee shall do all things reasonably required by Licensor to
preserve and protect such rights, including, without limitation, placing
Licensor's copyright notice on all Products and Materials.
4.5 REPRESENTATIONS, WARRANTIES AND DUTIES OF LICENSOR. Licensor represents and
warrants to Licensee and agrees that:
(a) Licensor has valid title to the applications and registrations for
the Marks as listed in EXHIBIT A in the Territory and has the right to enter
into this Agreement and to grant the licenses contained herein.
(b) There are no outstanding assignments, grants, licenses,
encumbrances, obligations or agreements of Licensor inconsistent with this
Agreement.
(c) Licensor does not in any way make any representation or give any
warranty as to the validity of the Licensed Property, any application or
registration therefor under the relevant laws of the Territory or as to any
commercial benefit of this Agreement to Licensee.
4.6 PROTECTION OF RIGHTS.
(a) In the ordinary course of business, Licensee or its counsel shall
review periodically the use and/or registration by others of any trademark,
service xxxx, trade name, trade dress, industrial model or design or copyright
in the Territory which is a copy of, identical or confusingly or deceptively
similar to the Licensed Property or any aspect thereof. Licensee agrees to
inform Licensor promptly of any possible infringement, or of any passing off or
unfair competition affecting said Licensed Property which comes to the attention
of Licensee. Further, Licensee agrees to fully cooperate and assist Licensor in
the protection and defense of any of Licensor's rights in the Licensed Property,
in the filing and prosecution of any trademark, trade dress, service xxxx, trade
name, copyright, industrial model or design application, registration, renewal
and the like, in the recording of this Agreement or any other relevant
agreements, including, without limitation, registered user agreements, and in
the doing of any other act with respect to the Licensed Property, including the
prevention of the use thereof by any unauthorized person, that in the sole
discretion and judgment of Licensor may be necessary or desirable.
(b) Licensor deems the Licensed Property to be extremely valuable
assets. Licensor shall have the sole right to determine whether or not any
action shall be taken on account of any infringement, passing off or unfair
competition activities or other enforcement of Licensor's rights in the Licensed
Property. If Licensor so desires it may prosecute any actions, claims, lawsuits
or proceedings in its own name or join Licensee as a party thereto, all at
Licensor's expense. Licensor shall be entitled to recover any and all sums of
money awarded and materials delivered up as a result of such actions, claims,
lawsuits or proceedings.
(c) Licensee shall not institute any lawsuit or take any action on
account of any actual or alleged infringement, passing off or unfair
competition, relating to the Licensed Property, and Licensee shall not have any
right or claim against Licensor for Licensor's failure to enforce its rights in
the Licensed Property or to prosecute any actual or alleged infringement,
passing off or unfair competition by others in relation to the Licensed
Property.
4.7 INDEMNIFICATION.
(a) LICENSEE'S INDEMNIFICATION.
(i) Except as provided in Article 4.7(b) below, Licensee agrees to
defend, indemnify and hold harmless Licensor and its
affiliates and their respective directors, officers,
employees, representatives and agents, at Licensee's expense,
for and from any and all actions, claims, proceedings or
lawsuits arising from or related in any way to Licensee's acts
or omissions. This indemnification shall include, without
limitation, claims of premises or product liability, claims of
patent, copyright, trade name, trademark, trade dress, service
xxxx or industrial model or design infringement, negligence,
defamation, misrepresentation, unfair competition, trade
secret misappropriation and failure to pay withholding tax.
Licensor agrees to give Licensee timely notice of such
actions, claims, proceedings or lawsuits and Licensee has the
right and obligation, at its sole expense, to defend the same
and shall be solely responsible for satisfying any monetary
judgments awarded or any settlements entered into as a result
of such actions, claims, proceedings or lawsuits. Licensor may
at its sole election participate in any such defense at its
own expense. In any event, Licensee agrees to keep Licensor
fully informed regarding all actions, claims, proceedings or
lawsuits which affect or involve Licensor.
(ii) Licensee shall not use any trade name of Licensor in
conducting its business, and shall not in any manner represent
to third parties that it is acting on behalf of or otherwise a
representative of Licensor, and Licensee agrees to defend,
indemnify and hold harmless Licensor from any action, claim,
lawsuit, cost, liability, cost or expense (including
reasonable attorney's fees) in connection with breach of this
provision.
(b) LICENSOR'S INDEMNIFICATION. Licensor agrees to defend, indemnify
and hold harmless Licensee and its affiliates and their respective directors,
officers, employees, representatives and agents, at Licensor's expense, for and
from any and all actions, claims, proceedings or lawsuits arising from or
related in any way to, claims that Licensee's use of the Licensed Property
hereunder infringes the trademark rights or copyrights of third parties in the
Territory, provided, however, that Licensor shall not bear any duty, obligation
or liability pursuant to this Article 4.7(b) to the extent and with respect to
any use of any of the Licensed Property in a manner not authorized by this
Agreement. Licensee agrees to give Licensor timely notice of such actions,
claims, proceedings or lawsuits and Licensor has the right and obligation, at
its sole expense, to defend the same and shall be solely responsible for
satisfying any monetary judgments awarded or any settlements entered into as a
result of such actions, claims, proceedings or lawsuits. Licensee may at its
election participate in any such defense at its own expense, provided, however,
that Licensee shall comply with any reasonable request of Licensor to cooperate
in the defense of any such actions, claims, proceedings or lawsuits. In any
event, Licensor agrees to keep Licensee fully informed
regarding all actions, claims, proceedings or lawsuits which affect or involve
Licensee under this paragraph.
4.8 TERM AND TERMINATION.
(a) Unless this Agreement is otherwise terminated by Licensor as
provided in this Agreement, and provided Licensee is in full compliance with its
duties and obligations hereunder, the initial Term of this Agreement shall be
extended automatically at the expiration of the initial Term for a first
"Renewal Term" unless Licensee gives Licensor written notice of termination
between February 1, 2004 and July 31, 2004. The first Renewal Term shall
commence on February 1, 2005 and continue until January 31, 2015, unless
terminated earlier. Subject to the same conditions, the initial Renewal Term
shall be extended automatically upon its expiration for a second Renewal Term
unless written notice of non-renewal is furnished to Licensor between February 1
and July 31 of the tenth year of the first Renewal Term. The Second Renewal Term
shall commence on February 1, 2015 and continue until January 31, 2025, unless
terminated earlier. Subject to the same conditions, the second Renewal Term
shall be extended automatically upon its expiration for a third Renewal Term
unless written notice of non-renewal is furnished to Licensor between February 1
and July 31 of the tenth year of the second Renewal Term. The Third Renewal Term
shall commence on February 1, 2025 and continue until January 31, 2035, unless
terminated earlier. All renewals shall be upon the same terms and conditions as
set forth in this Agreement, except as otherwise agreed to in writing by
authorized officers of the Parties. If this Agreement remains in effect in 2035,
the Parties agree to negotiate in good faith that year in order to conclude and
execute an updated version of this Agreement, one reasonably adapted to current
circumstances, market conditions, and the like.
(b) Without prejudice to any other rights Licensor may have, Licensor
may terminate this Agreement for any one or more of the reasons set forth in (i)
through (iv) below by written notice to Licensee in accordance with (c), (d) or
(e) below, as the case may be:
(i) if Licensee shall fail to make any payments when due or to
deliver any reports as required hereunder or otherwise
materially breaches in any manner the terms of this Agreement;
(ii) if Licensee shall be unable to pay its obligations when due,
or shall make any assignment for the benefit of creditors, or
shall file, or have filed against it, any petition for
protection or relief from creditors or any petition in
bankruptcy, or be adjudicated bankrupt or insolvent, or if any
receiver is appointed for its business or property or a
substantial portion thereof, or if any trustee in bankruptcy
or insolvency shall be appointed for Licensee, or if Licensee
shall be in default upon any material debt obligation and such
default shall be continuing beyond any applicable cure period,
or if any creditor of Licensee shall commence any action
against Licensor to collect
money or other obligations due from Licensee premised upon
Book I, Chapter IV, Article 23 of the Commercial Code of
Japan;
(iii) if Licensee shall fail in any material respect to follow
Licensor's instructions regarding the nature and quality of
the Products, Services or Materials and/or appropriate use of
the Licensed Property;
(iv) if Licensor, in its sole reasonable discretion, determines
that Licensee has ceased to carry on and diligently pursue its
day to day business activities of operating and promoting the
TSA Stores utilizing the Licensed Property.
(c) In the event of breach by Licensee of any provision of this
Agreement as provided in (b)(i), (b)(iii) or (b)(iv) above, Licensor shall give
Licensee notice in writing to cure the breach within sixty (60) days (the
"Notice Period") or such longer period as may be agreed upon by the Parties and
if the breach is not cured to the satisfaction of Licensor within such period,
Licensor shall be entitled to exercise any remedies it may have hereunder,
including, without limitation, its right to terminate this Agreement effective
upon expiration of the Notice Period, provided that if such breach is capable of
being cured but incapable, by reason of its nature, of being cured within the
Notice Period, Licensor may, in its discretion, delay taking action so long as
Licensee shall have begun in good faith to cure such breach within the Notice
Period and thereafter proceeds diligently to complete the cure of the breach and
such breach is cured within a reasonable period thereafter.
(d) In the event of the occurrence of any event described in (b)(ii)
above, Licensor may terminate this Agreement effective upon expiration of the
Notice Period; provided, however, that Licensee may avoid such termination if
any adverse filing described in (b)(ii) is stayed, dismissed or reversed within
the Notice Period and Licensee provides satisfactory evidence of same to
Licensor within such period.
(e) This Agreement shall automatically terminate on the date that
Licensor ceases to have a direct or indirect ownership interest in Licensee or
on the date that the AMENDED AND RESTATED JOINT VENTURE AGREEMENT is terminated,
whichever is earlier. If this Agreement should terminate as described in this
Article 4.8(e), the Parties agree to negotiate in good faith for the continued
use of the Licensed Property by Licensee as described in this Agreement. Such
negotiations shall begin at least fortyfive (45) days prior to the termination
of this Agreement and shall include all aspects of an agreement including
monetary compensation. Nothing in this Article 4.8(e) obligates Licensor to
postpone the termination of this Agreement.
(f) Licensee may terminate this Agreement in the event of a material
breach by Licensor, with written notice to Licensor and an opportunity to cure
the breach in a manner as provided in Article 4.8(g).
(g) Licensee shall give Licensor notice in writing to cure the breach
within the Notice Period or such longer period as may be agreed upon by the
Parties and if the
breach is not cured to the reasonable satisfaction of Licensee within such
period, Licensee shall be entitled to exercise any remedies it may have
hereunder, including, without limitation, its right to terminate this Agreement
effective upon expiration of the Notice Period, provided that if such breach is
capable of being cured but incapable, by reason of its nature, of being cured
within the Notice Period, Licensee may, in its discretion, delay taking action
so long as Licensor shall have begun in good faith to cure such breach within
the Notice Period and thereafter proceeds diligently to complete the cure of the
breach and such breach is cured within a reasonable period thereafter.
(h) This Agreement shall automatically terminate on as of January 31,
2035 unless it has been replaced with an updated agreement as set forth in
Article 4.8(a).
(i) This Agreement may be terminated at any time by mutual written
agreement of the Parties.
(j) Expiration or termination of this Agreement for any reason shall
not affect obligations which (i) have accrued as of the date of expiration or
termination, (ii) arise out of occurrences prior to the termination date or
(iii) become effective upon termination, including, but not limited to, (A) the
payment of any Royalties which have accrued as of the termination date or
thereafter, (B) the prohibitions on the disclosure of Confidential Information
set forth in Article 3.3, (C) the representations, warranties and obligations of
Licensee set forth in Article IV and Licensor's right to audit as set forth in
Article 4.3 and (E) the obligations set forth in Articles 4.8 (k), (l) and (m)
below relating to the discontinuance of the use of the Licensed Property upon
termination of this Agreement.
(k) Upon termination of this Agreement, the Parties shall mutually
cooperate to effect an orderly termination of their relationship as Licensor and
Licensee and Licensee shall within thirty (30) days:
(i) Return to Licensor all Technology, and cease using the
Licensed Property in any manner and for any purpose and take
all steps necessary to delete any and all references to any
Licensed Property from its business licenses, permits,
business forms, packaging, labels, advertisements, promotions
and other Materials;
(ii) Return to Licensor, destroy or obliterate all Products
(including packaging and labels) and Materials bearing the
Licensed Properties and furnish sworn affidavits attesting
thereto as requested by Licensor;
(iii) Cease holding itself out as a licensee of Licensor or as an
entity otherwise authorized or permitted to use the Licensed
Property;
(iv) Cooperate with Licensor in obtaining the cancellation of any
registration of this Agreement and amendment or cancellation
of any registered user agreements and corporate or business
name registrations. Licensee
hereby irrevocably appoints and authorizes Licensor as its
attorney-in-fact, with power to appoint and authorize
substitute powers of attorney-in-fact, to effect any such
amendments or cancellations.
(l) Notwithstanding the foregoing, upon termination or expiration of
this Agreement for any reason other than pursuant to Article 4.8(b)(i) or
(b)(iii), Licensee shall have, for a period of 180 days thereafter, the right to
sell off, on a nonexclusive basis, all of the unsold Products which were on hand
prior to such termination or expiration; provided, however, that Licensee shall,
prior to disposing of such unsold Products, furnish to Licensor an itemized and
sworn statement setting forth accurate descriptions and unit volumes of all such
unsold Products. Further, Licensee shall be entitled to phase out use of the
Technology over the same 180 day period. Royalties shall accrue at the then
current rate and be paid by Licensee within thirty (30) days of the end of such
180 day period. All dispositions of inventory and use of Licensed Property
pursuant to this paragraph shall strictly comply with all provisions of this
Agreement. On the 181st day, Licensee:
(i) shall immediately transfer to Licensor, or destroy, at
Licensor's option, all remaining inventory of Products;
(ii) shall immediately transfer to Licensor all Technology; and
(iii) shall have completely and permanently ceased using the
Licensed Property.
(m) Should Licensee fail to cease using any Licensed Property upon
termination of this Agreement, or in any other manner fail to comply with
Articles 4.8(k) and (l) above, Licensee agrees and hereby specifically consents
to each and all of the following remedies and provisions, which shall be
cumulative and not mutually exclusive:
(i) Licensor may obtain a decree of any court of competent
jurisdiction ordering Licensee to immediately cease the use of
the Licensed Property and to otherwise comply with Articles
4.8(k) and (l) above, to amend or cancel any registration of
this Agreement and any registered user agreements and to amend
or cancel any corporate or business name registrations and to
change its business name accordingly. Licensee's consent to
this remedy is based upon express recognition by Licensee that
Licensor would otherwise suffer irreparable harm and that
monetary damages would therefore be an inadequate remedy for
Licensor;
(ii) Licensor shall have the right to collect actual damages and
loss of income suffered by Licensor by reason of Licensee's
failure to comply with Articles 4.8(k) and (l) above, but, in
the alternative, and considering that it may be difficult to
determine actual damages and loss of income, the Licensee
shall pay to Licensor as liquidated damages (and not as a
penalty) four
percent (4%) of Gross Sales of the TSA Stores during any
period that Licensee fails to comply with any or each of the
requirements of Articles 4.8(k) and (l) above;
(iii) Licensor may file an action asking the appropriate
governmental agency to impound any infringing Products or
Materials and to close the TSA Stores;
(iv) The filing of a criminal infringement action;
(v) Licensor shall be entitled to any other relief which may be
deemed proper, whether at law or equity;
(vi) No assignee for the benefit of creditors, custodian, receiver,
trustee in bankruptcy, sheriff or any other officer of the
court or official charged with marshalling or taking over
custody of Licensee's assets or business shall have any right
to continue this Agreement or to exploit in any way or use the
Licensed Property;
(vii) Licensee's performance under this Agreement is personal in
nature and Licensor is excused from accepting the performance
of an entity other than Licensee. The Parties agree that this
Agreement is a nonassignable contract of Licensee under
section 365(c) of the Bankruptcy Code of the U.S.A., or any
amendment or successor thereto (the "Bankruptcy Code").
Further, in the event that Licensee is a debtor under the
Bankruptcy Code, or any equivalent in Japan, and this
Agreement has not been terminated, the Parties agree that the
adequate protection of Licensor's interest in this Agreement
and in the Licensed Property requires that Licensee fully
comply with all of the terms and conditions of this Agreement,
including, without limitation, timely making all Royalty
payments when due and maintaining the quality of Products and
Services sold by Licensee pursuant to this Agreement, and the
nature and quality of Licensee's use of the Licensed Property
as required hereunder.
4.9 CHOICE OF LAW AND FORUM; CHOICE OF LANGUAGE.
(a) This Agreement shall be governed and construed under federal laws
of the U.S.A. and laws of the State of Florida and for any controversy, the
Parties expressly submit to the exclusive jurisdiction of the state and federal
courts of the State of Florida, U.S.A., and hereby waive any claim of
inconvenient forum. Without limiting the foregoing, Licensee also submits to the
jurisdiction of any court in Japan with authority to hear and decide provisional
proceedings in relation to Licensor's provisional enforcement of this Agreement.
(b) The English/American spellings of words used in this Agreement and
their customary and usual meanings in the U.S.A. shall control the rights,
obligations and relationship of the Parties, and the construction and
interpretation of this Agreement,
and shall also be the controlling language for all future communications between
the Parties concerning this Agreement and the subject matter hereof.
4.10 NOTICES.
(a) Any notice or request with respect to this Agreement shall be made
personally, by registered mail, by airborne express courier, or by confirmed
facsimile and shall be directed by each Party to the other at its respective
address as follows:
If to Licensee, to:
Mega Sports Co., Ltd.
Adachi Xxxxxxxx
0-00-0, Xxxxxxxxxx Xxxxxxxxxxx
Xxxx-Xx, Xxxxx 000, XXXXX
Tel: 000-00-0-0000-0000
Fax: 000-00-0-0000-0000
Attention: President
with a copy to:
JUSCO Co. Ltd.
0-0-0, Xxxxxx, Xxxxxx-xx
Xxxxx-xxx, Xxxxx-xxx, 000, Xxxxx
Tel: 000 00 (000) 000-0000
Fax: 000 00 (000) 000-0000
Attention: General Manager
of International Business Department
AND TO:
JUSCO (U.S.A.), Inc.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, X.X. 00000
X.X.X.
Tel: 0 (000) 000-0000
Fax: 0 (000) 000-0000
Attention: Vice President and General Manager
and if to Licensor, to:
The Sports Authority Michigan, Inc.
000 X. Xxxxxxxxxx, Xxxxx 000
Xxxxx Xxx, Xxxxxxxx 00000
X.X.X.
Tel: 0 (000) 000-0000
Fax: 0 (000) 000-0000
Attention: Senior Vice President and General Counsel
WITH A COPY TO:
The Sports Authority, Inc.
0000 Xxxxx Xxxxx Xxxx 0
Xx. Xxxxxxxxxx, Xxxxxxx 00000
X.X.X.
Tel: 0 (000) 000-0000
Fax: 0 (000) 000-0000
Attention: Chief Executive Officer
(b) Any notice or request shall be deemed to be given when actually
received. Either Party, by written notice to the other Party, may change the
address to which notices or requests shall be directed.
4.11 NO IMPLIED WARRANTIES; LIMITATION ON LIABILITY. Neither Licensor nor its
employees or representatives shall be liable to Licensee or to any other party
for direct or indirect damages, losses, injuries or expenses, including
foreseeable and unforeseeable damages, resulting from or arising out of the use
or application of the Licensed Property. Neither Party makes any representation
or warranty to the other except as specifically set forth herein.
4.12 FURTHER DOCUMENTS. Each Party shall, upon request, make, execute and
deliver such documents as shall be reasonably necessary to take such action as
may be reasonably requested to fully implement and carry out the purposes of
this Agreement. This Agreement may be executed in counterparts and all such
counterparts taken together shall be deemed to constitute one and the same
instrument.
4.13 BINDING EFFECT. All covenants, agreements, representations, warranties and
indemnifications in this Agreement by and on behalf of either of the Parties
shall bind and inure to the benefit of the successors and permitted assigns of
Licensor and Licensee (if any). Upon termination of this Agreement, all
obligations and covenants of Licensee under this Agreement shall survive and be
enforceable.
4.14 NO PARTNERSHIP, NO JOINT VENTURE. This Agreement shall not be construed as
creating a joint venture, partnership or agency between Licensor and Licensee.
4.15 SUBLICENSING; PROHIBITION ON ASSIGNMENT BY LICENSEE. The licenses granted
herein are personal to Licensee and neither this Agreement nor any rights or
duties hereunder may be sublicensed, assigned, mortgaged or pledged by Licensee
without the prior written consent of an authorized officer of Licensor, which
consent may be withheld at Licensor's sole discretion. For purposes of this
Article 4.15, an assignment shall include any attempt to sublicense, assign,
mortgage or pledge by Licensee without the prior written consent of an
authorized officer of Licensor, and shall be null and void AB INITIO.
Notwithstanding the foregoing, Licensor may freely assign this Agreement
and/or its rights and duties hereunder, provided Licensor gives timely notice of
the same to Licensee.
4.16 WAIVER. Silence, acquiescence or inaction shall not be deemed a waiver of
any right. A waiver shall only be effective if it is in writing and signed by
the Party to be charged. Any such waiver shall not be construed as a continuing
waiver or as a waiver of any other breach of a same or similar nature.
4.17 SEVERABILITY. In the event that any part or portion of this Agreement shall
be deemed to be invalid or illegal, then such invalid or illegal portion shall,
so far as possible, not affect the validity or legality of the remainder of this
Agreement. Further, the Parties agree that they shall attempt to arrive at a
modification of any illegal or invalid part so as to render the same legal and
valid and within the keeping of the original tenor and spirit of the Agreement.
4.18 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between
the Parties with respect to use and licensing of the Licensed Property, and
supersedes all prior negotiations, understandings and agreements, if any,
between the Parties, whether oral or written. This Agreement replaces in its
entirety the License Agreement, and the latter is hereby terminated. Except as
otherwise provided in Articles I and II, this Agreement may only be amended or
modified by written instrument signed by THE Chief Executive Officers of each of
the Parties and the instrument shall clearly state in its title it amends or
modifies this Agreement. Because both Parties are sophisticated and
knowledgeable business enterprises with ready access to legal counsel, the
principle of construing an ambiguous provision or provisions against the drafter
shall be disregarded when construing this Agreement.
4.19 TITLES AND HEADINGS. Titles and headings herein are for convenience only
and are not part of this Agreement.
4.20 TAX ON AGREEMENT. Any stamp duty or other tax or duty imposed on this
Agreement or on any related registered user agreements shall be the sole
responsibility of and shall be paid by or on account of Licensee.
4.21 CONFIDENTIAL AGREEMENT. The terms of this Agreement are confidential and
shall not be disclosed except for the purpose of enforcement or registration or
recording or as may be required by law.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their duly authorized representatives as of the Effective Date.
THE SPORTS AUTHORITY, INC. MEGA SPORTS CO., LTD.
By: __________________________ By: ____________________
Title: __________________________ Title: ____________________
THE SPORTS AUTHORITY MICHIGAN, INC.
By: __________________________
Title: __________________________
