Exhibit 10.2
BRAND SALE AND LICENSE AGREEMENT
BETWEEN: Omniscent Corp.
a Florida corporation
"SELLER/LICENSOR"
AND
Nimbus Group Inc.,
a Florida corporation
"BUYER/LICENSEE"
TRADEMARKS: CARA MIA,
PRODUCT CATEGORIES: Men's and Women's Fragrances,
Skin Care Products, Bath and Related
Personal Care Beauty Products
TERRITORY: Worldwide
BRAND SALE/LICENSE AGREEMENT
THIS TRADEMARK LICENSE AGREEMENT (this "Agreement"), is made and
entered into this 1st day of May, 2003, by and between Omniscent Corp. a Florida
Corporation (hereinafter referred to as "Seller/Licensor"), and Nimbus Group
Inc., a Florida corporation. (hereinafter referred to as "Buyer/Licensee").
In consideration of the covenants and agreements contained herein, and
for other good and valuable consideration, the receipt and sufficiency of which
the parties acknowledge by signing this Agreement, the parties agree as follows.
BASIC TERMS
1. BRAND. As used in the Agreement, "Trademark" means the Trade name
CARA MIA, and any derivative thereof used by Licensor.
2. LICENSED PRODUCTS. As used in this Agreement, "Licensed Products"
means scented items intended to be rubbed, poured, sprinkled or sprayed upon or
otherwise applied to the human body for cleansing, beautifying, promoting
attractiveness or altering the appearance, including, but not limited to, toilet
water, colognes, perfumes, body powder, moisturizers, deodorants, soap, bath
salts and other related personal care beauty products, manufactured by or on
behalf of Licensee pursuant to this Agreement. Notwithstanding the foregoing,
until such time as Licensor has licensed to a third party the right to use a
Trademark in connection with cosmetic products, Licensee may use the Trademarks
on those cosmetic products approved by Licensor which are included as a gift
with purchase of Licensed Products.
3. TERRITORY. As used in this Agreement, "Territory" means and includes
every country in the world.
4. TERM. The term of this Agreement (the "Term") shall commence on the
date hereof (the "Commencement Date"), and shall be for a period of 5 years,
unless earlier terminated pursuant to the terms of this Agreement (as so
extended or earlier terminated, the "Term"). Each calendar year during the Term
shall be referred to herein as a "Year". The first "Year" of this Agreement for
the CARA MIA brand, shall commence on the Commencement Date of this agreement
and shall expire on December 31, 2008.
5. ROYALTY.
(a) ROYALTY PAYMENTS.
Licensee shall pay Licensor the following Royalty Payment
("RP") during each year of the Term:
(b) ROYALTY PAYABLE.
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Licensee shall pay Licensor Thirty percent (30%) of the
Licensee's Net licensing revenues (30% licensor / 70% licensee) on all products
licensee sells, licenses and or directly distributes.
6. GUARANTEED MINIMUM NET SALES.
During each Year, Licensee shall attain Net Sales of the Licensed
Products ("Guaranteed Minimum Net Sales") equal to Two Hundred Fifty Thousand
Dollars ($250,000.) Notwithstanding the foregoing, if Licensee has ceased
licensing or selling the Brand during a two year (2) aggregated period and after
30 days notice to cure from Licensor, Licensee shall have 90 days to either
resume sales of the Brand or return to Licensor all rights associated with the
Trademark. Licensee will however continue to remit the guaranteed minimum
royalties of Two Hundred Thousand Dollars or risk loosing the rights herein if
default is not cured after the 90 days notice has expired.
7. COMMENCEMENT OF DISTRIBUTION.
Licensee shall use its best efforts to commence distribution of the
Licensed Products no later than October 2003 or thereafter.
8. PURCHASE PRICE.
Buyer/Licensee agrees to purchase all the rights to the design and
development of the Cara Mia skin care product line from Seller/Licensor. The
intrinsic value of the Cara Mia brand design and development of the skin care
line has been agreed to be not less than $500,000. as of April 1st 2003. Upon
the execution of this Agreement, Seller/Licensor shall receive 2.5 million
shares of licensee's preferred convertible stock as payment for the design and
product development rights only, or $500,000 in cash payment/ It is expressly
agreed to by Buyer/Licensee and Seller/Licensor, that the Brand of Cara Mia is
not included in the sale portion of this agreement.
9. OPTION TO BUY-OUT THE BRAND.
Licensee may exercise his option to buy-out the Cara Mia Skin Care line
any time during term of this agreement for a cash payment of One Million Five
Hundred Thousand Dollars ($1,500,000.). This option can only be exercised by
Licensee as long as Licensee is in full compliance with RP and the terms of this
agreement.
10. EXPIRATION/TERMINATION OF MANUFACTURER'S AGREEMENT.
LICENSOR shall have the absolute right to require that LICENSEE
terminate its relationship with any subcontractor who, in the sole discretion of
LICENSOR, is behaving in a manner materially detrimental to LICENSOR. Upon the
expiration or termination of any Manufacturer's Agreement, LICENSEE shall cause
the subcontractor there under to immediately cease the manufacture of Products
and to fully perform and observe its obligations under the Manufacturer's
Agreement and under this Agreement with respect to such expiration or
termination.
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11. RIGHT TO INSPECT FACILITIES.
LICENSEE shall endeavor to ensure that LICENSOR shall have the right,
upon seventy-two (72) hours advance notice during normal business hours, to
inspect all facilities utilized by LICENSEE and its subcontractors and suppliers
in connection with the manufacture, storage or distribution of Products, and to
examine Products in the process of manufacture and all documents and records
related thereto.
12. CONSULTATION.
Upon request by LICENSOR, LICENSEE shall make its personnel and the
personnel of any of its subcontractors, suppliers and other resources available
by appointment during normal business hours for consultation with LICENSOR and
its agents, sub-contractors, factory(ies) or representatives.
(a) Supervision by and Responsibility of LICENSEE. LICENSEE
shall be responsible for supervising and controlling the acts of its
own factory(ies) and of its manufacturing subcontractors to prevent the
manufacturing or sale of Products that is not expressly authorized by
LICENSOR. If LICENSOR determines that LICENSEE permitted its own
employees or a subcontractor to manufacture or sell Products without
the authorization of LICENSOR, or that LICENSEE knew about such
manufacture or sale, LICENSEE shall immediately terminate its
relationship with said factory or subcontractor for contracts related
to the manufacture of Licensed Products that have not been placed into
production. Additionally any further business for Licensed Products
will be at the sole subjective approval of LICENSOR.
12.1 OWNERSHIP. LICENSEE acknowledges that Omniscent is the
exclusive owner of the Trademarks and of the IP Rights and that all of
LICENSEE's uses of the Trademarks and the IP Rights shall inure to the exclusive
benefit of both Omniscent as owner of the Trademark and LICENSOR.
12.2 REGISTRATION. LICENSEE shall cooperate fully and in good
faith with LICENSOR for the purpose of securing and preserving LICENSOR's rights
in and to the Trademarks and IP Rights, including, without limitation, in the
execution, submission and prosecution of any trademark, service xxxx, copyright
or patent applications and similar applications for registration which LICENSOR
may desire to submit at any time and from time to time. LICENSEE shall not
directly or indirectly submit any application to register the Trademarks for the
Products or any other products or services, or for any other trademark or
service xxxx, copyright, design right or invention of LICENSOR, without the
prior written approval of LICENSOR.
12.3 ASSIGNMENT OF RIGHTS. LICENSEE shall disclose and freely
make available to LICENSOR any and all developments or improvements it makes to
the Products, the Trademarks, or the IP Rights. This Agreement shall constitute
an assignment of all such developments and improvements to LICENSOR. If any
application must be made by LICENSEE or any third party which may have created
the designs of Products hereunder, LICENSEE agrees to, and does hereby, assign,
and agrees to cause such third party to assign to LICENSOR, any and all right,
title and interest in all such applications and the resulting registrations or
patents, as the case may be. If requested by LICENSOR, LICENSEE shall make,
procure and execute, and cause to be made, procured and executed,
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all assignments and/or all other agreements, documents or instruments determined
by LICENSOR to be necessary or advisable to vest ownership of the Trademarks and
IP Rights in LICENSOR. Additionally, LICENSEE hereby grants, and agrees to cause
the appropriate third party to grant to LICENSOR an irrevocable power of
attorney, on behalf of LICENSEE or such third party, as the case may be, to
execute any and all Trademarks and/or IP Rights applications, and other related
documentation that LICENSOR determines are necessary or advisable in connection
with the Trademarks and IP Rights.
12.4 PROHIBITED ACTS. LICENSEE shall not, directly or
indirectly claim ownership of the Trademarks or the limited IP Rights; and
(a) permit the use of the Trademarks or the
limited IP Rights in such a way as to give
the impression that they are the property of
LICENSEE; and
(b) use the Trademarks or the limited IP Rights
or any confusing trademark in any manner not
expressly authorized by LICENSOR; and
(c) engage in any activity that will contest,
dispute, dilute or otherwise impair the
right, title, interest or goodwill of
LICENSOR in the Trademarks, including,
without limitation, any action to prevent or
cancel any registration of the Trademarks;
and
(d) use the Trademarks in any manner that is not
necessary or beneficial for the manufacture
or distribution of the Products; and
(e) use any trademarks other than the Trademarks
in connection with the manufacture,
promotion and distribution of the Products
or associate the Trademarks or the IP Rights
with any other name, trademark, service
xxxx, character or personality; and
(f) use the Trademarks as part of LICENSEE's
corporate or commercial name unless
expressly permitted by LICENSOR in writing;
or
(g) contest the fact that LICENSEE's rights
under this Agreement are solely those of a
licensee and, subject to the provisions of
Section 17 cease upon valid termination or
expiration of this Agreement.
12.5 MISUSE. LICENSEE shall cooperate fully and promptly with
LICENSOR, at LICENSOR's expense, in the protection of LICENSOR's rights to the
Trademarks and the IP Rights in the Territory and in any jurisdiction where the
Products are either manufactured or sold. LICENSEE, at expense of LICENSOR,
shall take temporary immediate preemptive action to stop any minor infringement
or other misuse of the
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Trademarks or the IP Rights in connection with any
Products or services. LICENSEE will endeavor to promptly notify Licensee to the
extent that senior officers become aware of the same. Additionally LICENSEE will
endeavor to notify LICENSOR immediately by telephone and facsimile of any and
all cases of misuse of the Trademarks and IP Rights and cases of diversion of
the Products.
12.6 COMPLIANCE WITH RULES OF LICENSOR. LICENSEE shall place
appropriate notices reflecting ownership of designed products that specifically
contained identified IP Rights by LICENSOR, on all plans, packaging tags, labels
and Advertising and promotional materials in the manner requested by LICENSOR.
LICENSOR may promulgate, from time to time, rules and amendments thereto,
relating to use of the Trademarks and the IP Rights, and LICENSEE shall comply
with all such rules and amendments. Such rules and amendments shall be effective
upon receipt thereof by LICENSEE.
13. TRADE SECRETS AND CONFIDENTIALITY
A confidential relationship is created by this Agreement.
Except in connection with their respective rights and obligations under this
Agreement, LICENSOR, LICENSEE and their respective affiliates, employees,
attorneys and accountants shall keep confidential and not take or use for its or
their own purpose Trade Secrets of the other or the terms of this Agreement,
unless with the prior written consent of the other party hereto, or as may be
required by law, or in connection with regulatory or administrative proceedings
and only then with reasonable advance notice of such disclosure to the other
party hereto.
14. PAYMENTS AND REPORTS
ADVANCE. In consideration for the rights granted by LICENSOR
hereunder, LICENSEE shall pay to LICENSOR upon execution of this Agreement the
non-refundable amount of US$60,000.00 (30% of $200,000 advance) either, in cash
or in registered shares, of Licensee's Stock or a combination of both cash and
registered stock. Stock price shall be set at the average closing price of 30
days preceding the date of this agreement, which shall be applied as a credit
against the Royalty for the first Contract Year. Any remaining balance will
carry forward to the Second Contract Year.
14.1 ROYALTY BASIS. The Trademark Royalty shall be calculated
on the basis of the respective receipt of royalties and or sales of the
Products, regardless of whether LICENSEE sells Products to independent
wholesalers, distributors, retailers or licensing income. Arms' length
transactions or LICENSEE sells Products to any of its affiliates or to itself.
All related party sales shall be stated separately for the relevant period. A
Product shall be considered "sold" upon the date when such Product is invoiced,
shipped or paid for, whichever event occurs first. Sales of all Products are
subject to payment of the Trademark Royalty. Sales of products embodying an IP
Right, but not bearing the Trademarks are subject to the same royalty rate set
forth herein.
14.2 OTHER RIGHTS UNAFFECTED. It is understood and agreed that
termination of this Agreement by LICENSOR on any ground shall be without
prejudice to any other rights or remedies that LICENSOR may have.
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14.3 TERMINATION OPTION FOR MATERIAL BREACH. Except as
otherwise provided in this Agreement, if LICENSEE breaches any of its
obligations under this Agreement, LICENSOR may terminate this Agreement by
giving a notice of breach to LICENSEE. Termination will become effective
automatically unless LICENSEE completely cures the breach within thirty (30)
days after the giving of such notice.
14.4 TERMINATION OPTION/CHANGE OF OWNERSHIP. The parties
mutually acknowledge that this Agreement is being entered into based upon
Licensor's evaluation of and reliance upon the current ownership, management and
control of LICENSEE. Exhibit E is a list of the current management team of
Xxxxxxx Xxxxxxxxx as Chairman of Licensee and Xxxxxx Xxxxxxx, Officer and key
executive of Licensee and the fact that licensee is a publicly traded company on
the American Stock Exchange (NMC). On the basis of the information provided by
LICENSEE to LICENSOR, LICENSOR has determined that current management of
LICENSEE has the technical, marketing and sales expertise and sensitivity to
Licensor's unique image and to the goodwill represented by the Trademarks, all
of which are necessary to carry out the purposes of this Agreement. If any key
executive listed herein leaves the employment of LICENSEE, and that executive's
absence has a material adverse effect on LICENSOR, LICENSOR shall have the right
to terminate this Agreement, unless prior written consent of LICENSOR has been
granted which consent will not be unreasonably withheld. Neither this Agreement
nor any of the LICENSEE'S rights hereunder are assignable by LICENSEE, without
the prior written consent of LICENSOR which consent will not be unreasonably
withheld.
14.5 TERMINATION OPTION/ADDITIONAL CAUSES. LICENSOR may
terminate this Agreement immediately WITHOUT ANY RIGHT TO CURE if any of the
following events occur:
(a) LICENSEE merges or consolidates with or into
any other unaffiliated corporation, or
directly or indirectly sells or otherwise
transfers, sells or disposes of all or a
substantial portion of its business or
assets; and
(b) The Net Sales for any Contract Year for the
Territory do not equal at least seventy five
percent (75%) of the Minimum Net Sales
required in the Territory for such Contract
Year.
(c) LICENSEE intentionally reports materially
incorrect or false manufacturing, sales or
financial information; and
(d) LICENSEE is declared bankrupt or is
dissolved either compulsorily or
voluntarily, or a petition is presented or
an order is made or an effective resolution
is passed or analogous proceedings are taken
for bankruptcy, dissolution, composition,
concordance, reorganization or winding-up of
LICENSEE, or if LICENSEE convenes a meeting
for the purpose of making, or proposes or
enters into, any arrangement or composition
for the benefit of its creditors, or if an
encumbrances takes possession of, or a
receiver or other similar officer is
appointed for, the whole or any part of the
assets or undertakings of LICENSEE, or if
LICENSEE stops
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payment to its creditors generally, or
ceases or threatens to cease to carry on its
business or any substantial part thereof, or
becomes insolvent or unable to pay or
discharge its liabilities in the ordinary
course of business, or if LICENSEE assigns
the whole or any substantial part of its
assets or undertakings for the benefit of
creditors; and
(e) A manufacturing subcontractor retained by
LICENSEE manufactures or sells Products
without the express authorization of
LICENSOR and LICENSEE consented to, and
(f) N/A
(g) LICENSEE fails to timely present for sale to
the trade a representative collection of
each seasonal collection of the Products or
LICENSEE fails to timely ship to its
customers a minimum of seventy percent (70%)
of the orders of the Products it has
accepted; or
(h) Any other agreement between LICENSOR and
LICENSEE is terminated or expires.
14.6 NO ASSIGNEE. No assignee for the benefit of creditors,
receiver, liquidator, sequestrator, trustee in bankruptcy, sheriff or any other
officer of the court or official charged with taking over custody of Licensee's
assets or business shall have any right to continue the performance or rights of
LICENSEE under this Agreement.
15. ARBITRATION.
Any unresolved dispute or controversy arising under or in connection
with this Agreement (or any termination thereof) shall be settled exclusively by
arbitration, conducted before a panel of three (3) arbitrators in Miami-Dade
County, Florida, in accordance with the rules of the American Arbitration
Association then in effect. A decision by a majority of the arbitration panel
shall be final and binding. Judgment may be entered on the arbitrators' award in
any court having jurisdiction. The prevailing party shall receive and the
unsuccessful party shall pay the reasonable fees and expenses of any arbitration
proceeding in connection with this Agreement.
16. GOVERNING LAW.
This Agreement shall in all respects be construed according to the laws
of the State of Florida.
17. HEADINGS.
The paragraph headings herein are for reference purposes only and are
not intended in any way to describe, interpret, define, or limit the extent or
intent of the Agreement or of any part hereof.
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17.1 NOTICES. Addresses for notices:
To Licensee: To Licensor:
Xxxxxxx X. Xxxxxxxxx,
Interim Chairman Xxxxxx Xxxxxxx, President
Nimbus Group, Inc and Chief Executive Officer
0000 X.X. 000xx Xxxxxx Omniscent Corp.
Xxxxx 000 0000 Xxxxxx Xxxx. Xxxxx 0000
Xxxxxxxx, Xx. 33180 Xxxxxxxx, Xx. 00000
Phone: (000) 000-0000 Phone: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
IN WITNESS WHEREOF, the parties have executed this Agreement on the
date stated above.
BUYER /LICENSEE: SELLER/ LICENSOR:
By: /s/ Xxxxxxx X. Xxxxxxxxx By: /s/ Xxxxxx Xxxxxxx
---------------------------------- --------------------------------
Nimbus Group Inc. Xxxxxx Xxxxxxx, CEO
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AMENDMENT
This is an amendment to that certain Acquisition Agreement (the
"Agreement") between Nimbus Group, Inc. (the "Company") and Omniscent Corp.
WHEREAS, the Agreement was entered into by the parties on May 19,
2003;
WHEREAS, it is necessary to modify the Agreement as provided for
herein.
NOW, THEREFORE, the parties agree as follows:
1. Closing. The closing date for the acquisition shall be
January 31, 2004.
2. Termination. The Company, at its sold option, shall have the
absolute right to terminate the Agreement without liability, except
for the payment of royalties, if any, with respect to the Cara Mia
product.
3. Amendment. Except as provided for herein, the Agreement
shall, in all respects, survive the Amendment.
This Amendment is made this _____ day of December, 2003, effective May
19, 2003.
NIMBUS GROUP, INC. OMNISCENT CORP.
By: By:
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