1
EXHIBIT 6.1
LICENSE AGREEMENT
License No. 331-1
THIS LICENSE AGREEMENT is dated this 5TH day of Feb, 1999, but effective
August 1, 1998, (the "Effective Date"), made by and between THE TRUSTEES OF THE
ESTATE OF XXXXXXX XXXXXX XXXXXX, hereinafter referred to as "Licensor" whose
principal place of business and post office address is 000 Xxxxx Xxxx Xxxxxx,
Xxxxxxxx, Xxxxxx 00000 and HAWAIIAN VINTAGE CHOCOLATE COMPANY, Inc., a Hawaii
corporation, hereinafter referred to as "Licensee", whose residence is in
Kahoahuna Homestead, and whose post office address is 0000 Xxxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxx 00000.
W I T N E S S E T H:
WHEREAS, the parties have agreed that Licensee shall be allowed to
utilize the property (the "licensed area"), consisting of 75.0 (40.0 usable)
Acres, more or less, located at Umauma, North Hilo, Hawaii, being a portion of
Tax Map Key 000-000-000, (the "land"), more particularly shown on the sketch
attached hereto and made a part hereof as Exhibit "A", together with the rights
of others to use the existing roadways for ingress and egress purposes;
NOW, THEREFORE, the parties hereto, in consideration of the property
hereby agree to the following terms and conditions:
1. Term. The term of this License Agreement shall commence from
the Effective Date and shall continue for a period of Three (3) years, unless
sooner terminated or extended as set forth in this License Agreement.
2. Option to Extend Term. Licensee shall have the option to
extend the term (the "extended term") of this License Agreement for Three (3)
year periods on the same terms, covenants, and conditions as contained in this
License Agreement, except as to the amount of the annual license fee, upon the
following conditions:
(a) Licensee shall deliver to Licensor written irrevocable
notice of Licensee's intent to extend the term no earlier than one hundred fifty
(150) days and no later than one hundred twenty (120) days prior to the
expiration of the then effective term of this License Agreement.
2
(b) Subject to the provisions in Paragraph 3(b), Licensee
and Licensor shall have mutually agreed upon the amount of the new annual
license fee no later than ninety (90) days prior to the expiration of the then
effective term of this License Agreement.
(c) Licensee shall have been, throughout the term of this
License Agreement, and shall be at the time of the extension, in full compliance
with all of the terms and conditions of this License Agreement and not in
default of any of the provisions stated herein.
(d) Licensee shall be personally in occupancy of the
licensed area upon expiration of the then effective term.
(e) this License Agreement shall be in full force and
effect at the time of the exercise of the option as well as upon commencement of
the extended term of this License Agreement.
If Licensee fails to exercise the option to extend in
strict compliance with the time, manner and conditions set forth in this
paragraph, the option shall have no further force and effect. Licensee shall not
have any option to further extend the time of this License Agreement.
3. License Fee.
(a) For Licensee's use of the licensed area, Licensee
shall pay to the Licensor an annual license fee, payable in advance in equal
monthly payments, to be paid on the first day of each month during the entire
term of this License Agreement. The annual license fee for the first (l) year of
this License Agreement shall be fixed at TWO THOUSAND AND N0/100 DOLLARS
($2,000.00). Licensee shall pay said annual license fee in equal monthly
installments of ONE HUNDRED SIXTY SIX AND 67/100 DOLLARS ($166.67). The annual
license fee for the second (2) year of this License Agreement shall be fixed at
THREE THOUSAND AND N0/100 DOLLARS ($3,000.00). Licensee shall pay said annual
license fee in equal monthly installments of TWO HUNDRED FIFTY AND N0/100
DOLLARS ($250.00). The annual licensee fee for the third (3) year of the License
Agreement shall be fixed at FOUR THOUSAND AND N0/100 DOLLARS ($4,000.00).
Licensee shall pay said annual license fee in equal monthly installments of
THREE HUNDRED THIRTY THREE AND 33/100 DOLLARS ($333.33).
(b) The annual license fee during the extended three year
term for the fourth (4) year is fixed at SIX THOUSAND AND N0/100 DOLLARS
($6,000.00). Licensee shall pay said annual license fee in equal monthly
installments of FIVE HUNDRED AND N0/100 DOLLARS ($500.00). The annual license
fee for the fifth (5)
-2-
3
year of this License Agreement shall be fixed at SEVEN THOUSAND AND N0/100
DOLLARS ($7,000.00). Licensee shall pay said annual license fee in equal monthly
installments of FIVE HUNDRED EIGHTY THREE AND 33/100 DOLLARS ($583.33). The
annual license fee for the sixth (6) year of this License Agreement shall be
fixed at EIGHT THOUSAND AND N0/100 DOLLARS ($8,000.00). Licensee shall pay said
annual license fee in equal monthly installments of SIX HUNDRED SIXTY SIX AND
66/100 DOLLARS ($666.66).
(c) Licensee shall pay said license fee in lawful money of
the United States of America at the times and in the manner aforesaid, without
deduction and without any notice or demand at the office of the Licensor at the
address aforesaid.
4. Royalty Fee, Renegotiation of Royalty Fee, Adjusted Gross
Income and Reports and Audit.
(a) Royalty Fee. In addition to the annual license fee,
Licensee shall pay to Licensor within one hundred twenty (120) days after each
calendar year, a royalty fee for each calendar year during the term of this
License Agreement and any extended term, prorated if necessary, four and
one-half percent (4.5%) of Licensee's Adjusted Gross Income exceeding SIXTY FOUR
THOUSAND SEVENTY THREE AND 78/100 DOLLARS ($64,073.78) for the first (1) year;
and EIGHTY SEVEN THOUSAND TWO HUNDRED TWENTY ONE AND 78/100 DOLLARS ($87,221.78)
for the second (2) year; ONE HUNDRED TEN THOUSAND THREE HUNDRED SIXTY NINE AND
78/100 DOLLARS ($110,369.78) for the third (3) year; and ONE HUNDRED FIFTY SIX
THOUSAND SIX HUNDRED SIXTY FIVE AND 78/100 DOLLARS ($156,665.78) for the forth
(4) to sixth (6) year. Licensee shall submit reports indicating gross revenues
prior to May 1st of each year.
(b) Renegotiation of Royalty Fee. At the end of the third
year of the term of this License Agreement, the royalty fee shall be subject to
negotiation. Should Licensee and Licensor fail to reach an agreement as to the
annual license fee sixty (60) days prior to the commencement date of the
extended term, this License Agreement shall be surrendered pursuant to paragraph
15.
(c) Adjusted Gross Income. For each calendar year during
the term of this License Agreement, Licensee's gross income derived from or
attributable to the licensed area, including without limitation the gross
proceeds from the sale of crops, regardless of whether such sales are made by
Licensee or any contract xxxxxx of Licensee, if any, or otherwise, as shown on
the annual federal or state income tax return or Hawaii general excise tax
return of Licensee and any contract xxxxxx, less all Hawaii general excise tax
paid on such gross proceeds, and less real property taxes and assessments paid
with respect to the licensed area in the calendar year.
-3-
4
(d) Report and Audits. Licensee will submit to Licensor
together upon each payment of the royalty fee within one hundred twenty (120)
days after the end of each calendar year during the term of this License
Agreement and any extended term, a signed statement of Licensee's Adjusted Gross
Income for the licensed area received by Licensee during such calendar year and
the amount of royalty fee due to Licensor under subparagraph (a) of this
paragraph 4. Licensee shall submit to Licensor with such statement a copy of
Licensee's federal or state income tax return and Hawaii general excise tax
return submitted to the State of Hawaii for such calendar year. Licensee shall
keep at a location on the Island of Hawaii known to Licensor, for a period of
three (3) full calendar years following the end of each such calendar year, all
books, records and federal or state income tax returns and Hawaii general excise
tax returns of Licensee pertaining to operations on the licensed area during
such calendar year. All such books, records and tax returns shall be open to
inspection and audit by Licensor and Licensor's agents at all reasonable times
during ordinary business hours. If any audit of Licensee's annual statement made
within two (2) years after the end of the year covered by such statement by a
certified public accountant or accounting firm employed by Licensor shall
disclose an error prejudicial to Licensor in an amount equal to two percent (2%)
or more in the amount of royalty fee payable to Licensor, then Licensee will pay
to Licensor the expense of such audit. Any deficiency or excess in the payment
of royalty fee for such year as determined by such audit shall thereupon be
adjusted between Licensor and Licensee.
(e) Licensee shall pay said license fee in lawful money of
the United States of America at the times and in the manner aforesaid, without
deduction and without any notice or demand at the office of the Licensor at the
address aforesaid.
5. Use. Licensee shall use the property for agricultural
purposes only. Licensee may construct an irrigation system, packing, cleaning
and storage sheds on the licensed area without an increase in the license fee.
No residential use will be permitted. Licensee shall not use the licensed area
for any other purpose or purposes. Licensee shall not cause any use or cause any
act to be done in or about the licensed area which is illegal, unlawful or
violates any covenant affecting the licensed area.
6. Additional License Fee. Licensee will also pay to Licensor, as
additional license fee, within ten (10) days after the date of mailing or
personal delivery of statements therefor, all costs and expenses paid or
incurred by Licensor and required to be paid by Licensee under any provision of
this License Agreement. If Licensee shall become delinquent in the payment of
its license fee or other payments required hereunder to be made by Licensee to
-4-
5
Licensor, Licensee will also pay to Licensor as an additional license fee,
interest thereon from the respective due dates thereof until fully paid at the
rate of 12% per year.
7. General Excise Tax. Licensee will pay to Licensor as an
additional license fee, at the time and together with each payment of its
license fee, or other charge required hereunder to be made by Licensee to
Licensor which is subject to the Hawaii general excise tax on gross income or
any successor or similar tax, an amount which, when added to the license fee, or
other charge (whether actually or constructively received by Licensor), shall
yield to Licensor after deduction of all such taxes payable by Licensor with
respect thereto, a net amount equal to that which Licensor would have realized
therefrom had no such tax been imposed.
8. Taxes and Assessments. Licensee will also pay to Licensor as
an additional license fee, at least ten (10) days before the same become
delinquent, all real property taxes and assessments of every description to
which the licensed area or any part thereof or improvement thereon or Licensor
or Licensee in respect thereof, are now or may during said term be assessed or
become liable, whether assessed to or payable by Licensor or Licensee provided,
however, that with respect to any assessment made under any betterment or
improvement law which may be payable in installments, Licensee shall be required
to pay only such installments of principal together with interest on unpaid
balances thereof as shall become due and payable during said term, and that such
taxes shall be prorated as of the dates of commencement and expiration
respectively of said term. If at any time during said term there shall be
assessed against the licensed area or any part thereof or any improvement
thereon or any fees payable to Licensor therefor or against Licensor in respect
thereof any new taxes (other than federal or state net income taxes or any other
taxes existing at the commencement of said term) which are in substitution for
real property taxes or are in lieu of increase thereof, Licensee will also pay
to Licensor as additional license fee at least ten (10) days before the same
become delinquent, all such new taxes. Licensee will also pay any and all
conveyance taxes imposed by the State of Hawaii in respect to this License
Agreement. In the event that there shall be more than one licensee of Licensor
on the Land, Licensor shall have the right to allocate the real property taxes
and any other taxes payable by Licensee under this License Agreement among such
licensees, including the Licensee, in a fair and equitable manner. Such
allocation by Licensor shall be final and binding on Licensee. It is agreed that
Licensee will pay all Real Property Taxes on the lands encumbered by this
agreement beginning in 1999-2000 tax year. Licensee will pay Real Property Tax
for the tax period before the 1999-2000 tax year at the agricultural rate
appropriate to the crops planted.
-5-
6
9. Rates and Other Charges. Licensee will pay directly before
the same become delinquent all utility charges including water and sewer rates,
garbage rates and other charges and outgoings of every description to which the
licensed area or any part thereof or improvement thereon, or Licensor or
Licensee in respect thereof, may during said term be assessed or become liable,
whether assessed to or payable by Licensor or Licensee.
10. Assignment and Consent to Assignment. Licensee shall not
assign or mortgage this License Agreement or any interest hereunder, voluntarily
or involuntarily, without the prior written consent of Licensor. Such consent
may be withheld if, in the sole judgment of Licensor, the technical and
financial capabilities of the proposed assignee of this License Agreement or any
interest hereunder do not meet the criteria for evaluating such technical and
financial capabilities as established by Licensor.
11. Sublicense and Consent to Sublicense. Licensee will not
without the prior written consent of Licensor rent, sublicense or part with
Licensee's right to use the licensed area or any part thereof and any request
for Licensor's consent to a proposed sublicense must be accompanied by a copy of
the proposed sublicense agreement and disclosure of all terms of the sublicense
agreement. Prior to granting such consent, Licensor shall have the right to
review and approve the proposed sublicensee fee and may withhold their consent,
in the sole judgment of Licensor, 1) if the proposed sublicense fee is below
existing market sublicense fee for similar licensed areas, 2) if the proposed
sublicensee (or its principal or affiliates) has fewer than five years of prior
experience in agricultural, 3) if the proposed sublicensee is not credit worthy,
as evidenced by a lack of existing lines of credit, loans or other sources of
financing, or 4) if the proposed sublicensee's proposed use of the licensed area
will conflict with the operations of adjacent or nearby tenants or licensees.
In the event of the sublicensing with the consent of
Licensor, Licensee shall pay Licensor, on the first day of each month of the
term of this License Agreement, one-half (1/2) of the monthly rent payable to
Licensee by the sublicensee. For purposes of this paragraph, the term "monthly
rent" shall mean so much of the total valuable consideration (whether consisting
of fixed, minimum and/or percentage rent; and/or commission, percentage and
premiums payable by the sublicensee to Licensee on amounts owing to third
parties by the sublicensees and/or Licensee in consequence of this License
Agreement and/or the sublicensee; and/or any amounts that would constitute
additional license fee as that term is defined in paragraph 6 above), prorated
on a monthly basis, without deduction or setoff by Licensee, as shall be
payable by the sublicensee to or on behalf of Licensee.
-6-
7
In addition to any amounts otherwise owing by Licensee to
Licensor above, Licensee shall pay to Licensor an amount equal to the amount
payable by Licensor pursuant to Hawaii General Excise Tax Law, or any successor
substitute law, on gross income actually or constructively received by Licensor
pursuant to this paragraph 11.
12. Improvements Required By Law. Licensee will at its own
expense during the term of this License Agreement maintain and make any and all
necessary repairs required by law to be made to the licensed area, and shall
abide by all Federal, State and local laws, statutes, ordinances, rules and
regulations pertaining to its operations and to the installation, maintenance
and/or operation of its improvements.
13. Restoration, Repair and Maintenance. Licensee will at its
own expense from time to time and at all times during said term substantially
restore, repair, maintain, amend and keep all equipment, buildings, if any, and
towers, including any other improvements now or hereafter built or made on the
licensed area with all necessary reparations and amendments whatsoever in good
and safe repair, order and condition, reasonable wear and tear and destruction
by unavoidable casualty not herein required to be insured against.
14. Inspection. Licensee will permit Licensor and their agents at
all reasonable times during said term to enter the licensed area and examine
the state of repair, cultivation and condition thereof, and Licensee will
repair and make good at its own expense all defects required by the provisions
of this License Agreement to be repaired by Licensee of which notice shall be
given by Licensor or their agents within thirty (30) days after the giving of
such notice or such other reasonable time as may be specified therein. If for
any reason Licensee shall fail to commence and complete such repairs within
thirty (30) days after the giving of such notice or such other reasonable time
as may be specified therein, Licensor may, but shall not be obligated to, make
or cause to be made such repairs and shall not be responsible to Licensee or
anyone claiming by, through or under it for any loss or damage to the occupancy,
business or property of any of it by reason thereof, and Licensee will pay to
Licensor on demand and as additional license fee all costs and expenses paid or
incurred by Licensor in connection with such repairs.
15. Surrender. At the end of said term Licensee will peaceably
deliver up to Licensor possession of the licensed area, together with all
equipment and buildings (if any), including any other improvements, upon or
belonging to the licensed area, by whomsoever made, in good and safe repair,
order and condition, except as otherwise expressly provided in paragraph 13
hereof;
-7-
8
provided, further, that if Licensee is not then in default under this License
Agreement, Licensee may thereupon remove any removable or salvageable equipment
which can be removed without material damage to the licensed area, land or
building. The foregoing covenant of Licensee shall survive the expiration of
said term.
16. Construction. Licensee will not construct or place any
buildings or structures, fences or walls, or other improvements on the licensed
area, nor make or suffer any additions to or structural alterations of the basic
structure of any buildings, nor change the grading or drainage thereof, without
the prior written consent of Licensor; provided, however, that Licensee may
construct an irrigation system, packing, cleaning and storage sheds. Any such
construction or alterations shall be done under the supervision of a licensed
architect or structural engineer and in accordance with complete plans,
specifications and detailed plot plans therefor prepared by such an architect or
structural engineer and first approved in writing by Licensor. No such approval
by Licensor shall be deemed a warranty or other representations on their part
that such plans, specifications or detailed plot plans or the building or
buildings, or other improvements therein described are legal, safe or sound
prior to commencing any construction of new buildings on the licensed area.
Licensee shall furnish Licensor evidence that all governmental
approvals necessary to commence construction have been obtained, including,
without limitation, a building permit. Licensee shall provide Licensor with
evidence satisfactory to Licensor that funds are available and/or committed to
Licensee sufficient to pay for 100% of the total direct and indirect costs of
constructing such alterations, additions or improvements. Licensee shall deposit
with Licensor copies of performance and labor and material payment bonds for not
less than 100% of the total cost of such construction, naming Licensor and such
other persons as Licensor may direct, as their interest may appear, as
co-obligees. Such bonds shall be in form and amount and with surety satisfactory
to Licensor. In addition to any other insurance required under this License
Agreement, during any construction Licensee and/or its contractor shall maintain
the comprehensive general liability insurance policy and other insurance
policies required under this License Agreement, which policies shall be
satisfactory to Licensor in form, content and amount of coverage, insuring
Licensor, Licensee and such other parties as Licensor shall specify, against
loss or damage to third parties or their property from hazards normally insured
against in the construction industry with respect to construction of the type to
be undertaken by Licensee. Licensee shall deliver to Licensor certificates of
insurance certifying that such insurance is in full force and effect.
-8-
9
17. Fire and Other Casualty Insurance. Licensee will at
Licensee's own expense at all times during said term keep its portion of all
equipment and buildings, including any other improvements on the licensed area
insured against loss or damage by fire and other causes of loss included in the
standard ISO Special Coverage Form. The policy shall be with an insurance
company authorized to do business in Hawaii, in an amount as near as practicable
to the full replacement cost thereof (which amount Licensee will review as to
sufficiency at least annually and, if insufficient, will increase), and shall be
in the joint names of Licensor, Licensee and any mortgagee as each of their
interest may appear. Licensee will pay all premiums on such insurance when due,
and will deliver to Licensor a copy of the policy or a certificate of insurance
within thirty (30) days after execution of this License Agreement and will
provide copies of renewal policies or certificates of insurance prior to the
renewal date of such insurance. The policy shall contain a clause that the
insurer will not cancel or reduce coverages without first giving Licensor thirty
(30) days prior written notice. In every case of loss or damage to Licensee's
portion of said equipment or buildings, including any other improvements, all
proceeds of such insurance (excluding the proceeds of any rental value or use
and occupancy insurance of Licensee) shall be used with all reasonable speed by
Licensee for rebuilding, repairing or otherwise reinstating the same portion of
said equipment or buildings, including any other improvements in a good and
substantial manner according to the original plan and elevation thereof or such
modified plan conforming to laws and regulations then in effect as shall be
first approved in writing by Licensor and any mortgagee, and Licensee will make
up from its own funds any deficiency in the insurance proceeds. If Licensee's
portion of the existing equipment or buildings, including any other improvements
on the licensed area shall during the last two years of said term be destroyed
or damaged to an extent exceeding 50% of the actual cash value thereof
immediately prior to such casualty, and the insurance proceeds are insufficient
for restoring Licensee's portion of such restoration, Licensee may at its option
within thirty (30) days after such casualty notify Licensor in writing of its
intention to surrender this License Agreement, and Licensor shall, within thirty
(30) days after receipt of such notice, advise Licensee in writing of their
acceptance of such surrender, in which case Licensee shall, within sixty (60)
days after receipt of such acceptance, cause all debris and remains of its
portion of damaged equipment or buildings, including any other improvements to
be removed from the licensed area under a contract therefor first approved in
writing by Licensor and surrender to Licensor this License Agreement free and
clear of any encumbrances and all interests of Licensee and any mortgagee in the
remaining insurance proceeds and thereby be relieved of all further obligations
hereunder, it being understood that if Licensor shall fail to so advise Licensee
of their acceptance of such surrender or
-9-
10
their election to restore such equipment or buildings, including any other
improvements as hereinafter provided, such failure shall be deemed to constitute
acceptance of such surrender.
18. Liability Insurance. Licensee shall, during the entire term
of this License Agreement, keep in full force and effect, liability insurance
with respect to the licensed area and the business operated by Licensee and
subtenants of Licensee, if any. This insurance shall be provided by an insurance
company acceptable to Licensor, with combined single limit of public liability
for personal injury and property damage of not less than $2,000,000.00 per
occurrence. Licensee shall name Licensor as additional insureds. The policy
shall contain a clause that the insurer will not cancel or change the insurance
without first giving Licensor thirty (30) days prior written notice. A copy of
the policy or a certificate of insurance shall be delivered to Licensor within
thirty (30) days after the execution of this License Agreement, and Licensee
will provide certificates of insurance or, upon request, copies of such
insurance policies, prior to the renewal date of any such insurance.
19. Licensee's Personal Property. Licensee shall insure and keep
insured all personal property of Licensee, in, on or upon the licensed area.
Such insurance shall insure against loss from fire and other causes of loss
provided for in the standard ISO Special Coverage Form. Any policy proceeds
shall be used for the repair or replacement of any personal property damaged or
destroyed unless this License Agreement shall cease and terminate under the
provisions hereof.
20. Preservation of Historic and Archaeological Sites. The
Licensee shall take every reasonable precaution to preserve and leave unaltered
all places, if any, of historic and/or archaeological interest, including
without limitation structures and sites listed on the Hawaii State Register of
Historic Places and/or the National Register of Historic Places, ponds,
reservoirs, heiau, altars, agricultural terraces, lo'i, walls, auwai, house
platforms, imu, petroglyph sites, cemeteries; and all objects, if any, of
historic and/or archaeological interest, including without limitation
antiquities and specimens of Hawaiian or other ancient art or handicraft which
may be found in or on the licensed area. Upon the discovery of such objects or
of any human remains in or on the licensed area, the Licensee will leave the
same untouched and will immediately notify the Licensor of the type and location
of such discovery.
21. Indemnity. Licensee will indemnify and hold Licensor harmless
from and against all claims and demands for loss or damage, including property
damage, personal injury and wrongful death, arising out of or in connection with
the use or occupancy of
-10-
11
the licensed area by Licensee or any other person under Licensee, or any
accident or fire on the licensed area or any nuisance made or suffered thereon,
or any failure by Licensee to keep the licensed area in a safe condition, and
will reimburse Licensor for all costs and expenses including reasonable
attorneys' fees incurred in connection with the defense of any such claims, and
will hold all equipment or buildings, including any other improvements and
personal property belonging to Licensee on the licensed area at the sole risk of
Licensee and shall save Licensor harmless from any loss or damage thereto by any
cause whatsoever.
22. Expenses of Licensor. Licensee will pay to Licensor, within
ten (10) days after the date of mailing or personal delivery of statements
therefor, (a) all costs and expenses including reasonable attorneys' fees paid
or incurred by Licensor but required to be paid by Licensee under any covenant
herein contained or paid or incurred by Licensor in enforcing any of Licensee's
covenants herein contained, in protecting themselves against any breach thereof,
in remedying any breach thereof, in recovering possession of the licensed area
or any part thereof, in collecting or causing to be paid any delinquent license
fees, taxes or other charges hereunder payable by Licensee, or in connection
with any litigation (other than condemnation proceedings) commenced by or
against Licensee to which Licensor shall without fault be made parties, and (b)
a reasonable fee for reviewing and processing any request by Licensee for
Licensor's consent or approval, which fee shall be a flat-rate service charge as
established by the policy of Licensor then in effect or a sum equal to all costs
and expenses paid or incurred by Licensor, including without limitation
reasonable fees of attorneys and other consultants retained by Licensor and the
costs of Licensor's regular salaried staff in connection therewith, whichever is
greater. All such costs, expenses and fees shall constitute additional license
fee and shall bear interest as provided in paragraph 23 hereof.
23. Default and Defeasance. This License Agreement is upon the
express condition that if Licensee shall fail to pay said license fee or any
part thereof within fifteen (15) days after the same becomes due and payable,
whether the same shall or shall not have been legally demanded, or shall fail to
observe and perform faithfully any of its covenants or agreements herein
contained performable by the payment of money (other than the payment of license
fee) and such default shall continue for thirty (30) days after a statement
therefor given by the obligee to Licensee, or shall fail to observe or perform
faithfully any of its other covenants or agreements herein contained and such
default shall continue for thirty (30) days after written notice thereof given
by Licensor to Licensee, or shall abandon the licensed area, or if this License
Agreement or any estate or interest of Licensee hereunder shall be sold under
any attachment or execution, Licensor
-11-
12
may at once re-enter the licensed area or any part thereof in the name of the
whole and, upon or without such entry, at their option terminate this License
Agreement, without service of notice or legal process and without prejudice to
any other remedy or right of action for arrears of license fee or other charges
or other breach of contract. If Licensee shall fail to observe or perform any of
its covenants herein contained, Licensor at any time thereafter and without
notice may, but shall not be obligated to, observe or perform such covenant for
the account and at the expense of Licensee, and all costs and expenses incurred
by Licensor in observing and performing such covenant shall constitute
additional license fee and shall bear interest at the rate of 12% per year.
24. Condemnation. If the whole of the licensed area shall be
taken by any public authority under the power of eminent domain, then the term
of this License Agreement shall cease as of the day possession is taken by such
public authority and all license fees shall be paid up to that date. All
compensation and damages payable or to be paid for or by reason of such taking
shall be payable or to be the sole property of Licensor. If only a part of the
licensed area shall be taken under eminent domain, this License Agreement shall
terminate as to the portion taken and unless this License Agreement shall be
terminated, as hereinafter provided, it shall continue in full force and effect
as to the remainder of the licensed area.
If the remainder of the licensed area cannot be used for the
purpose for which Licensee has been using the licensed area, Licensee shall have
the option, to be exercised within thirty (30) days after the filing of such
eminent domain action, of cancelling this License Agreement effective as of the
date the condemning authority shall take possession.
Licensee shall have the right to claim and recover from the
condemning authority, but not from Licensor, such compensation as may be
separately awarded or recoverable by Licensee in Licensee's own right on account
of any cost or loss to which Licensee might be put in removing Licensee's
fixtures and equipment.
25. Hazardous Waste. Licensee shall keep and maintain the
licensed area including without limitation the groundwater on or under the
licensed area, in compliance with, and shall not cause or permit the licensed
area or any portion thereof to be in violation of, any federal, state or local
laws, ordinances or regulations, now or hereafter in effect, relating to
environmental conditions, industrial hygiene or Hazardous Materials (as
hereinafter defined), on, under or about the licensed area including without
limitation the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended, 42
-12-
13
U.S.C. Section 9601, et seq., the Hazardous Materials Transportation Act, 49
U.S.C. Section 1801, et seq., the Resource Conservation and Recovery Act, 42
U.S.C. Section 6901, et seq., the Clean Water Act, 33 U.S.C. Section 1251, et
seq., the Clean Air Act, 42 U.S.C. Section 7401, et seq., the Toxic Substances
Control Act, 15 U.S.C. Sections 2601 through 2629, the Safe Drinking Water Act,
42 U.S.C. Sections 300f through 300j, and any similar state and local laws and
ordinances and the regulations now or hereafter adopted, published and/or
promulgated pursuant thereto (collectively the "Hazardous Materials Laws"),
Licensee shall not use, generate, manufacture, treat, handle,
refine, produce, process, store, discharge, release, dispose of or allow to
exist on, under or about the licensed area any flammable explosives, radioactive
materials, asbestos, organic compounds known as polychlorinated biphenyls,
chemicals known to cause cancer or reproductive toxicity, pollutants,
contaminants, hazardous wastes, toxic substances or related materials, including
without limitation any substances defined as, or included in, the definition of
"hazardous substances", "hazardous wastes", hazardous materials", or "toxic
substances" under the Hazardous Materials Laws (collectively "Hazardous
Materials"), except in strict compliance with all applicable Hazardous Materials
Laws. Furthermore, Licensee shall not allow to exist on, under or about the
licensed area any underground storage tanks or underground deposits.
Licensee shall immediately advise Licensor in writing of (i) any
and all enforcement, clean up, removal, mitigation remediation or other
governmental or regulatory actions instituted, contemplated or threatened
pursuant to any Hazardous Materials Laws affecting the licensed area, (ii) all
claims made or threatened by any third party against the Licensee or the
licensed area relating to damage, contribution, cost recovery, compensation,
loss or injury resulting from any Hazardous Materials (the matters set forth in
clauses (i) and (ii) above are hereinafter referred to as "Hazardous Materials
Claims"), (iii) the Licensee's discovery of any occurrence or condition on the
licensed area which could subject Licensee, Licensor or the licensed area to any
restrictions on ownership, occupancy, transferability or use of the licensed
area under any Hazardous Materials Laws.
Licensor shall have the right to join and participate in, as a
party if it so elects, any settlements, remedial actions, legal proceedings or
actions initiated in connection with any Hazardous Materials Claims and to have
its reasonable attorneys' fees incurred in connection therewith paid by the
Licensee. Licensee shall be solely responsible for and shall indemnify and hold
harmless Licensor and its employees, agents, successors and assigns from and
against any loss, damage, cost, expense or
-13-
14
liability directly or indirectly arising out of or attributable to the use,
generation, manufacture, treatment, handling, refining, production, processing,
storage, release, threatened release, discharge, disposal or presence of
Hazardous Materials, on, under or about the licensed area by or through Licensee
including without limitation: (a) the costs of any required or necessary repair,
cleanup or detoxification of the licensed area, and the preparation and
implementation of any closure, remedial or other required plans; and (b) all
reasonable costs and expenses incurred by Licensor in connection therewith,
including without limitation reasonable attorneys' fees.
Licensee will indemnify Licensor against and hold Licensor
harmless from all costs and expenses (including reasonable fees of legal
counsel), losses, damages (including foreseeable or unforeseeable consequential
damages) and liabilities incurred by Licensor which may arise out of or may be
directly or indirectly attributable to (a) the use, generation, manufacture,
treatment, handling, refining, production, processing, storage, release,
discharge, disposal or presence of any Hazardous Material on, within, under or
about the licensed area, (b) Trustee's investigation and handling (including the
defense) of any Hazardous Materials Claims, whether or not any lawsuit or other
formal legal proceeding shall have been commenced in respect thereof, and (c)
Licensor enforcement of this License Agreement, whether or not suit is brought
therefor. The provisions of paragraph 25 of this License Agreement shall
survive the termination of this License Agreement.
If requested by Licensor at the end of the license term Licensee,
at its sole cost and expense, shall cause a Phase I Environmental Survey of the
licensed area to be conducted of the property by a competent and experienced
environmental engineer or engineering firm and shall provide a copy of such
Survey to the Licensor in order to confirm Licensee's compliance with the
covenants contained in this paragraph.
26. Permits and Notices. Licensee shall at its own expense be
solely responsible for obtaining any governmental zoning classification,
approval or consent required by law for or in connection with Licensee's
operations hereunder and shall also give any notices necessary or incidental to
said operations.
27. Survey. Within six (6) months of the Effective Date, Licensee
shall provide to Licensor a metes and bounds survey and boundary map for the
licensed area prepared and certified by a professional land surveyor registered
to practice in the State of Hawaii.
-14-
15
29. Liens. Licensee shall not permit any liens to be attached to
the improvements or the licensed area.
30. Successors. All of the covenants, agreements, provisions,
terms and conditions contained in this License Agreement shall apply to, inure
to, and be binding upon Licensor, Licensee, and its successors, successors in
trust and assigns.
31. Disclaimer of Warranties. The provisions of this License
Agreement constitute, and are intended to constitute, the entire agreement of
the parties to this License Agreement, and no terms, conditions, warranties,
promises or undertakings of any nature whatsoever, express or implied, exist
between the parties, except as herein expressly set forth.
32. Non Waiver. The waiver by Licensor of any breach of any term,
covenant or condition herein contained, shall not be deemed to be a waiver of
such term, covenant or condition of any subsequent breach of the same or any
other term, covenant or condition herein contained. The subsequent acceptance of
any license fee or other sums due hereunder by Licensor shall not be deemed to
be a waiver of any preceding breach by Licensee of any term, covenant or
condition of this License Agreement, other than the failure of Licensee to pay
the particular license fee or other amount so accepted, regardless of Licensor's
knowledge of such preceding breach at the time of acceptance of such license fee
or other amount. No covenant, term or condition of this License Agreement shall
be deemed to have been waived by Licensor unless such waiver is in writing,
signed by Licensor.
33. Licensee's Assumption of Risk Regarding Restriction on Use.
Notwithstanding any provision to the contrary, Licensee expressly acknowledges
and agrees that by accepting this License Agreement upon the terms and
conditions provided herein, Licensee has agreed to assume all risks relating to
any restriction on the use of the licensed area arising out of, or relating to,
any governmental land use and zoning laws, the building code, or the design of
the improvements comprising the property. If, for any of the foregoing reasons
or causes, Licensee is unable to use the licensed area for the purposes set
forth in paragraph 5, Licensee's sole remedy shall be to terminate this License
Agreement, and upon such termination and the payment of any outstanding sums
owed by Licensee to Licensor, Licensee shall be relieved of any further
obligations to Licensor under this License Agreement. In no event shall Licensee
have any recourse against Licensor for any claims for damages, loss of profits
or other general or consequential damages arising out of the termination of this
License Agreement due to the reasons or causes set forth in this paragraph. This
release of liability has been expressly bargained for by Licensor in agreeing to
issue this License Agreement to Licensee upon the
-15-
16
terms and conditions contained herein, and Licensee acknowledges that Licensee
has been advised by its legal counsel of the consequences of this release of
liability in favor of Licensor. This release of liability shall accordingly be
liberally construed in favor of Licensor to effect the intention of the parties
in entering into this License Agreement.
34. Subdivision. If at any time during the term of this License
Agreement any governmental authority shall require that the licensed area be
legally subdivided in order for this License Agreement to be kept in effect,
Licensee agrees to undertake, at its sole cost and expense all the steps
necessary to obtain a legal subdivision of the Land. If Licensee fails to effect
the required subdivision within the time permitted by the complaining
governmental authority, this License Agreement shall terminate.
35. Paragraph Headings. The headings of paragraphs herein are
inserted only for convenience and reference and shall in no way define or limit
the scope or intent of any provision of this License Agreement.
36. No Interest in Real Property. Licensee agrees that Licensee
does not and shall not claim at any time any real property interest in the land
owned by Licensor or any landlord-tenant relationship with Licensor by virtue of
this License Agreement or its occupancy or use of the licensed area. THIS
LICENSE AGREEMENT IS NOT A LEASE.
37. Severability. If any term of this License Agreement or any
application thereof shall be invalid or unenforceable, the remainder of this
License Agreement and any other application of such term shall not be affected
thereby.
38. Entire Agreement. This License Agreement and the Exhibit
attached hereto and forming a part hereof set forth all the covenants, promises,
agreements, conditions and understandings between Licensee and Licensor
concerning the licensed area and there are no covenants, promises, agreements,
conditions or understandings, either oral or written, between them, other than
are herein set forth. Except as herein otherwise provided, no subsequent
alteration, amendment, change or addition to this License Agreement shall be
binding upon Licensor or Licensee unless reduced to writing and signed by them.
39. No Partnership Intended. It is expressly understood that
Licensor does not intend and shall not, in any way or for any purpose
whatsoever, become a partner of Licensee in the conduct of its business, or
otherwise, or joint venturer or a member of a joint enterprise with Licensee
pursuant to this License Agreement.
-16
17
40. Notices. All notices, requests, demands or documents which
are required or permitted to be given or served hereunder shall be in writing
and personally delivered, or sent by registered or certified mail addressed as
follows:
To Licensor:
000 Xxxxx Xxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxx 00000
Attention: Hawaii Island
Region Regional Director
To Licensee:
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxx 00000
The addresses may be changed from time to time by the addressee
by serving notice as heretofore provided. Service of such notice or demand shall
be deemed complete on the date of actual delivery as shown by the addressee's
registry or certification receipt or at the expiration of the third day after
the date of mailing, whichever is earlier in time.
41. Consents of Parties. Except as otherwise set forth in this
License Agreement, where the consent of either party is required under the terms
of this License Agreement, such consent shall not be unreasonably withheld.
42. Trustees Not Personally Liable. This License Agreement has
been approved or executed by the Trustees of the Estate of Xxxxxxx Xxxxxx Xxxxxx
in their fiduciary capacities as said Trustees, and not in their individual
capacities. No personal liability or obligation under this instrument shall be
imposed or assessed against said Trustees in their individual capacities.
-17-
18
IN WITNESS WHEREOF, the parties hereto have executed these presents as
of the day and year first above written.
TRUSTEES OF THE ESTATE OF HAWAIIAN VINTAGE CHOCOLATE
XXXXXXX XXXXXX XXXXXX COMPANY, Inc., a Hawaii
corporation
By: /s/ [SIGNATURE ILLEGIBLE] By: /s/ [SIGNATURE ILLEGIBLE]
--------------------------------- --------------------------------
Area Development Manager) Its President
Licensor Licensee
------------------------------------
Approved:
Approved as Date:
to Form: /s/ [SIGNATURE ILLEGIBLE] -----------------------------
----------------------------
Witness: /s/ [SIGNATURE ILLEGIBLE]
------------------------------
-18-
