EXHIBIT 10.15
LICENSE AGREEMENT
THIS AGREEMENT ("Agreement") is made as of the 10th day of May 1999, by
and between Famous Fixins, Inc. ("Licensee"), a corporation organized under
the laws of the State of New York, having its principal place of business at
000 Xxxx 00xx xxxxxx, Xxxxx 0000, Xxx Xxxx, XX 00000, and Xxxxxx Xxxxxxxx
("Licensor"), an individual of full age and majority, with an address c/x
Xxxx Associates Management Enterprises ("FAME"), 0000 Xxxxxxxxx Xxx, XX,
Xxxxx 000, Xxxxxxxxxx, XX 00000 (Attn: Xxxxx Xxx).
WHEREAS, Licensee manufactures celebrity food Products and has been
granted the exclusive right to the use of the name and likeness of Licensor
on and in connection with the development, manufacture, distribution,
promotion, and sale of one (1) cereal product endorsed by Licensor ("the
Product").
NOW THEREFORE, in consideration of the mutual promises and undertakings
contained herein, and for other good and valuable consideration the receipt
of which is hereby acknowledged, the parties agree as follows:
1. Grant of License. Licensor hereby grants Licensee the right to
use the name, approved photograph, likeness, and biographical data of
Licensor (the "Licensed Subject Matter") in connection with the development,
manufacture, distribution, promotion, and sale of the Product ("the
License"). This License shall be effective worldwide from May 1, 1999
through and including June 30, 2000 (the "Term"), unless terminated in
accordance with the terms and conditions of Paragraphs 8 or 9 below.
Subject to the above provisions, Licensee agrees that Licensor shall
retain all rights in and to the Licensed Subject Matter and, whether during
the Term or any extension thereof, Licensor shall not be prevented from
using, permitting, and/or licensing others to use the Licensed Subject Matter
in connection with the advertisement, promotion, and/or endorsement of any
product or service except for ready-to-eat cereal.
Licensee acknowledges that Licensor has a valid, existing, worldwide
endorsement agreement, which grants exclusive rights to NIKE, Inc. in
connection with shoes and apparel (the "NIKE Agreement"). Pursuant to the
NIKE Agreement, Licensor is permitted to grant Licensee the right to produce,
manufacture, distribute, and sell Licensor approved t-shirts and hats bearing
the logo for "Zo's Summer Groove," a charity event run by Licensor (the
"Apparel Products"), so long as the Apparel Products are manufactured by
NIKE, Inc.
Accordingly, Licensor hereby grants Licensee the right to produce,
manufacture, distribute, and sell the Apparel Products, provided that such
Apparel Products are sold exclusively on the back and side panels of the
packaging of the Product ("Apparel Products"). Licensee agrees that any and
all Apparel Products shall contain a logo for "Zo's Summer Groove," as well
as the logo for the food Product produced. Prior to any manufacture,
promotion, sale, advertisement, and/or distribution of the Apparel Products,
Licensee agrees to submit such Apparel Products to FAME (Attn: Xxxxx Xxx),
for their prior written approval. Licensee agrees not to manufacture,
promote, sell, advertise, and/or distribute any Apparel Products without
written approval from FAME. Licensee further agrees that Licensee shall be
responsible for any and all costs associated with the manufacture, promotion,
sale, advertisement, and/or distribution of the Apparel Products, and that
Licensor shall bear no costs whatsoever in connection with the Apparel
Products.
2. Licensee's Obligations. Licensee shall undertake to use its best
efforts to develop, manufacture, distribute, promote, and sell the Product,
provided, however, that Licensee shall in its sole and absolute discretion
have the right to determine: (a) the type and quantity of Product developed
and manufactured, (b) the markets in which the Product are distributed and
sold; (c) the manner of distribution and sale of the Product; and (d) the
volume and nature of advertising for the Product
1
(subject to Paragraph Four (4) below). Licensee shall pay all costs and
expenses in connection with the development, promotion, manufacturing,
packaging, shipping, distribution, sales and promotion of the Product. All
rights, titles, and interests in and to the Product, their formulae and
secret ingredients, and their packaging and labeling shall be, and they are
specifically and entirely, reserved to Licensee and may be fully exploited
without regard to the extent to which such rights may be competitive with
this Agreement or the rights granted hereunder.
3. Licensor's Obligation. Licensor agrees to be available for one
(1) personal appearance on behalf of the Licensee for the purposes of
participating in a promotional press conference (the "Personal Appearance").
The Personal Appearance shall last no longer than two (2) hours, and shall
take place in Miami, Florida at a date and time, and location compatible with
Licensor's schedule and which is mutually convenient to Licensor and
Licensee. The Personal Appearance shall be subject to Licensor's
professional commitments. Licensee shall provide first-class round-trip
limousine transportation in connection with the Personal Appearance. Failure
to attend the Personal Appearance by Licensor due to any professional
commitments shall not be deemed to be a breach of this agreement, including
instances wherein Licensor's professional commitments arise after the
scheduling of the Personal Appearance, provided however, that Licensor and
Licensee reschedules the Personal Appearance at a mutually agreeable date,
time, and location, subject to Licensor's professional commitments. In all
such cases, Licensor shall bear no costs whatsoever, including by way of
example, reliance costs of Licensee, for the Personal Appearance. Licensor
shall make a good faith effort to furnish Licensee with sufficient
information about the Licensor's schedule so that Licensee may adequately
prepare its promotions and sales programs. Any and all publicity regarding
the Product shall be issued only by Licensee.
4. Quality Assurance. Licensee agrees that all use of the Licensed
Subject Matter shall be only upon the Product manufactured by or for Licensee
in accordance with quality standards approved by Licensor prior to the
commencement of manufacturing of the Product. Licensee agrees to submit to
Licensor and FAME (Attn: Xxxxx Xxx), for their approval and review, a copy of
any and all materials utilizing the Licensed Subject Matter at least fourteen
(14) days prior to their release to the general public; and Licensee further
agrees that the same shall not be released without the prior written approval
of FAME. Licensor and FAME agree, however, that they shall not unreasonable
withhold or delay their approval of said materials and that in absence of
disapproval, within ten (10) days of receipt thereof, said advertising and
promotional materials shall be deemed approved.
5. Compensation. For full and complete compensation to Licensor for
entering into and performing the terms and conditions of the Agreement, and
provided that Licensor completely perform his obligations hereunder, Licensee
shall pay Licensor a license fee (the "Licensing Fee") in an amount equal to
five percent (5%) of all monies received by Licensee as revenue
derived from the sale of the Product ("Gross Receipts" less slotting fees).
Licensor will also receive twenty five percent (25%) of Net profits
derived from the sale of other related merchandise from the back panel or
elsewhere on the packaging or promotional materials of the Product. "Net
Profits" shall be defined as the aggregate of all revenues received through
the sale and/or distribution of the Apparel Products, less the actual costs
of the Apparel Products incurred by Licensee. In addition, as further
consideration for this Agreement, Licensor has received a warrant to purchase
50,000 shares of the Company's unregistered common stock at the purchase
price of $.15 per share (the "exercise price") with an expiration date of
five (5) years from the date hereof.
6. Accounting. Licensee shall render a detailed accounting to
Licensor on a quarterly basis within 60 days after the first day of January,
April, July, and October. Each accounting shall show both quarterly and
cumulative Gross Receipts for the Product and shall be accompanied by the
payment in full then due to the Licensor.
7. Insurance. Licensee warrants that it has or will obtain, at its
own cost and expense, a commercial general liability insurance policy in the
amount of eight million dollars ($8,000,000) including coverage for Licensor
(the "Policy"). The policy shall be issued by a major insurance carrier
authorized to do business in all jurisdictions where the product is sold, and
shall be maintained
2
until Licensee's performance in connection with this
Agreement has been completed and shall name Licensor as an additional
assured. Licensee shall furnish FAME (Attn: Xxxx Xxxxx), with a certificate
by no later than May 1, 1999, evidencing such insurance coverage, which shall
state in substantial part:
"Should any of the above described policies be cancelled before the
expiration date thereof, the issuing company will endeavor to mail
ten (10) days written notice to the certificate holder (Licensor)
named to the left."
Failure to obtain insurance shall be considered a breach of this Agreement
and shall give Licensor the right to terminate the Agreement. Upon such
termination, Licensee shall forfeit all monies previously paid to Licensor,
which shall be deemed liquidated damages. In all such instances, Licensee
shall remain liable to Licensor for all compensation under this Agreement.
Such liability shall be in addition to, and not in limitation of, any and all
other remedies available to Licensor in law or equity.
8. Licensor Termination. Licensor may terminate this Agreement upon
thirty (30) days written notice if (a) Licensee breaches a material term of
this Agreement and fails to remedy said breach within fifteen (15) days of
its receipt of written notice of the breach; (b) Licensee becomes insolvent
or files a petition in bankruptcy or (c) Licensee permanently discontinues
production and distribution of the Product; (d) Licensee fails to make any
payments to Licensor due under this Agreement. Should Licensor terminate
this Agreement pursuant to this paragraph, the parties agree that Licensee
shall have a period of sixty (60) days commencing upon the date of
termination, in which Licensee shall be permitted to sell off any existing
inventory of the Product that was manufactured prior to the date of
termination (the "Sell-Off-Period"). At the conclusion of the Sell-Off-
Period, all rights in and to the Licensed Subject Matter shall immediately,
automatically, and irrevocably revert to Licensor, and Licensee shall have no
further rights in and to the Licensed Subject Matter.
9. License Termination. Licensee may terminate this agreement upon
thirty (30) days written notice if (a) Licensor breaches a material term of
this Agreement and fails to remedy said breach within fifteen (15) days of
his receipt of written notice of the breach; (b) Licensor is convicted of a
felony involving moral turpitude. Should Licensee terminate this Agreement
pursuant to this paragraph, the parties agree that Licensee shall have a
period of sixty (60) days commencing upon the date of termination, in which
Licensee shall be permitted to sell off any existing inventory of the Product
that was manufactured prior to the date of termination (the "Sell-Off-
Period"). At the conclusion of the Sell-Off-Period, all rights in and to the
Licensed Subject Matter shall immediately, automatically, and irrevocably
revert to Licensor, and Licensee shall have no further rights in and to the
Licensed Subject Matter automatically, and irrevocably revert to Licensor,
and Licensee shall have no further rights in and to the Licensed Subject
Matter.
10. Indemnification. The parties hereto shall indemnify, defend,
protect, and hold each other harmless from and against any and all actions,
claims, suits, losses, judgements, penalties, liabilities, damages, costs and
expenses, including, without limitation, reasonable attorney's fees and court
costs, of whatever kind and nature imposed on, incurred by, or asserted,
made, brought, or made against each other arising out of a party's breach of
any of its representations, warranties, or obligations made pursuant to this
agreement, or through the gross negligence or intentional acts of its
officers, directors, employees, or representatives. Licensee agrees to
protect, save, defend, indemnify, and hold harmless Licensor, FAME, their
assigns, heirs, and employees from and against any and all expenses, damages,
claims, suits, actions, judgements, and/or costs whatsoever, including
attorney fees, arising out of, or in any way connected with, any claim or
action arising out of this Agreement and/or the Product. The provisions of
this section shall survive any termination or expiration of this Agreement.
3
11. Assignment. Neither Licensor nor Licensee shall assign this
Agreement without the prior written consent of the other party, except that
Licensee shall have the right to assign this Agreement to any wholly owned
subsidiary, or to any person, firm, or corporation owning or acquiring a
majority of Licensee's stock or assets.
12. Notices. Any notice to be hereunder shall be made in writing and
shall be sent by certified U.S. mail, return receipt requested, postage paid.
All notices to Licensor shall be sent to Xxxxxx Xxxxxxxx, c/o FAME 0000
Xxxxxxxxx Xxx XX, Xxxxx 000, Xxxxxxxxxx XX, 00000 (Attn: Xxxxx Xxx, cc: Xxxxx
X Xxxxxx, Esq.), with a copy to: Xxxxxxx Xxxxxxxx, FAME, 0000 Xxxxx Xxxxxxxx
Xxxxx, Xxxxx 0000, Xxxxxxx Xxxxx, XX 00000. All notices to Licensee shall be
sent to Famous Fixins, Inc., 000 Xxxx 00xx Xx., Xxxxx 0000, Xxx Xxxx, XX
00000.
13. Relationship of the Parties. Nothing in this Agreement shall be
construed to (a) give either party the power to direct or control the day to
day activities of the other; (b) constitute the parties as partners, joint
ventures, co-owners, or otherwise as participants in a joint and common
undertaking; or (c) constitute Licensor, its agents, or employees as the
agents or employees of Licensee or to grant them any power or authority to act
for, bind or otherwise create any obligation on behalf of Licensee for
any purposes whatsoever. Licensor shall be solely responsible for the
payment of all taxes on compensation received under this Agreement.
Accordingly, Licensee shall make no deductions for tax purposes from any
compensation paid to Licensor.
14. Governing Law and Jurisdiction. Any controversy or claim arising
out of or relating to the construction of application of any terms,
provisions, or conditions of this Agreement shall on the written request of
any party hereto served on the other party, be submitted to arbitration and
such arbitration shall comply with and be governed first, in accordance with
the laws of the State of New York, and second, when not in conflict with the
laws of the State of New York, by the provisions of the American Arbitration
Association ("AAA"), as both are applicable contracts made and performed
entirely within the state of New York. Such arbitration shall be binding on
the parties.
Said location of the arbitration shall be in the office nearest to
Licensee's offices in New York City.
The cost of arbitration shall be borne by the losing party or in such
proportion as the arbitrator shall decide.
Judgement on the award rendered by the arbitrator may be entered in any
court in the world having jurisdiction,
15. No Grant of NBA Trademark Rights. Licensor in no way grants, or
purports to grant, to License any rights or uses of any names, logos,
trademarks, service marks, etc. owned by the NBA, NBA Properties, and/or any
NBA member team (including, but not limited to, the Miami Heat), including by
way of example only, any photographs of licensor in a n NBA uniform or any
reference to the NBA, NBA Properties, or any NBA member team (including, but
not limited to, the Miami Heat).
16. Confidentiality. Neither party shall disclose (or permit any
third party to disclose) the financial or other material terms of this
Agreement, with the exception only of either party's agents, attorneys,
accountants, representatives or employees, except as may be required by law.
17. Entire Agreement. This Agreement set forth the entire
understanding of the parties with respect to its subject matter. No waiver,
modification, or addition to this agreement shall be valid unless reduced to
writing and signing by both parties. If any provision of this Agreement
shall be held void, voidable, invalid, or inoperative, no other provision of
this Agreement shall be affected as a result thereof, and, accordingly, the
remaining provisions of this Agreement shall remain in full force and effect
as though such void, voidable, invalid, or inoperative provision had not been
4
contained therein. Notwithstanding the foregoing, in the event any provision
is held void, voidable, invalid, or inoperative and impairs Licensee's right
to manufacture, distribute, promote, or sell the Product, then Licensee may,
upon notice to Licensor, terminate this Agreement.
IN WITNESS WHEREOF, the parties have executed this agreement in New
York, New York, on this day and year first above written.
LICENSEE: FAMOUS FIXINS,INC.
By: /s/ Xxxxx Xxxxx
-----------------------
Xxxxx Xxxxx, President
LICENSOR: /s/ Xxxxxx Xxxxxxxx
-------------------
Xxxxxx Xxxxxxxx
5
