TRADEMARK LICENSE AGREEMENT
AGREEMENT made as of this 29th day of May, 2002 between AUDIOVOX
CORPORATION, a Delaware corporation, having a principal office at 000 Xxxxxx
Xxxxxxxxx, Xxxxxxxxx, XX 00000 ("Licensor") and AUDIOVOX COMMUNICATIONS CORP., a
Delaware corporation, having a principal office at 000 Xxxxxxxx Xxxx.,
Xxxxxxxxx, XX 00000 ("Licensee"):
W I T N E S S E T H :
WHEREAS, Licensor is the owner of the valuable trademark "AUDIOVOX" as a
word xxxx in various logos and designs, which is the subject of a registered
trademark in the United States (Patent & Trademark Office Registration Numbers
1,234,338; 1,432,756 and 2,138,694) and many other countries (the "Trademark"),
and
WHEREAS, Licensee has expressed a desire to be licensed to use the
Trademark in connection with the manufacture and sale of Products (as
hereinafter defined) for distribution to Licensee's Market (as hereinafter
defined).
NOW, THEREFORE, it is agreed as follows:
1. LICENSE.
--------
Subject to the terms and conditions of this Agreement, Licensor hereby
grants to Licensee, and Licensee hereby accepts, a royalty free, non-exclusive
and non-transferable license to use the trademark "AUDIOVOX" solely in
connection with the sale, distribution and service of mobile cellular handset
systems and other wireless communications devices that use the infrastructure of
wireless communications carriers (the "Products") and to sell, distribute and
service the same within Licensee's Market and Territory as hereinafter
described, provided that all of said Products produced
Exhibit 99.7
1
by Licensee shall be produced in accordance with the specifications and
instructions submitted by Licensee to Licensor and approved by Licensor and
provided further that all requirements of Licensor with respect to quality of
Products sold under the Trademark shall be at all times strictly observed by
Licensee and by its production facilities. Licensee may apply such Trademark
only in connection with the Products produced by manufacturers approved by
Licensor in accordance with such specifications and instructions, and the
quality thereof shall at all time be satisfactory to Licensor. Upon request of
Licensor, Licensee shall require that any production facility producing the
Products to be sold under the Trademark shall in writing acknowledge the
validity of the Trademark and agree to refrain from any use thereof for its own
account or for the account of anyone other than Licensee or Licensor.
2. QUALITY CONTROL.
---------------
Licensee will permit or will arrange for permission to duly authorized
representatives of the Licensor, at all reasonable times, to inspect the
premises of the Licensee or of the production facilities which Licensee shall
use and to inspect and test the Products in connection with which Licensee uses
or intends to use the Trademark.
3. PACKAGING AND ADVERTISING.
-------------------------
Licensee shall so package the Products in connection with which it uses the
said Trademark as to conform to the packaging design approved by the Licensor.
Licensee agrees to submit to Licensor for its approval all designs for packaging
which Licensee proposes to use and agrees that it will not use any packaging
design which shall not have been previously approved by Licensor. Licensee
further agrees that all advertising and other promotional material which it
proposes to use
Exhibit 99.7
2
with respect to Products to be sold under the Trademark shall be subject to
review and approval of Licensor and that no such advertising will be published
without such approval, which approval Licensor will not unreasonably withhold,
provided that the same generally conforms to advertising standards observed by
Licensor and provided further that all such advertising and all packaging of
said Products shall contain a statement to the effect that said Trademark is the
property of Licensor and that the Product so advertised or enclosed in any such
package is manufactured and sold under license from Licensor.
4. PRODUCT LIABILITY INSURANCE AND INDEMNITY.
-----------------------------------------
Licensee agrees to maintain product liability insurance in limits
satisfactory to Licensor insuring both Licensee and Licensor against all
liability which may arise or be asserted against either Licensor or Licensee or
both, arising out of or connected with the use of Products produced and sold by
Licensee under the said Trademark, and Licensee shall furnish to Licensor upon
demand, and from time to time, certificates evidencing the continued maintenance
of such product liability insurance. Notwithstanding such insurance, Licensee
hereby indemnifies Licensor against any liability or loss which may be asserted
or incurred through claims of third persons against the Licensor arising out of
or related to the manufacture or sale of Products sold by Licensee under said
Trademark.
5. EXTENT OF LICENSE.
-------------------
The license granted by Licensor to Licensee hereunder shall be
non-exclusive and is limited to the Products that are sold through the Carrier
Distribution Channel. The Carrier Distribution Channel is comprised of:
(a) A direct channel through which ACC sells Products to Carriers. The
direct channel consists of (a) retail stores owned by Carriers and (b)
the Carriers'
Exhibit 99.7
3
sales organizations for corporate enterprise customers; and
(b) An indirect channel through which ACC sells Products to retailers,
distributors and agents that are authorized by Carriers to activate
Products, to sell air time on behalf of Carriers, to promote Products
to end users and to perform other activities that support the sale of
Products to end users on behalf of Carriers.
The Carrier Distribution Channel is referred herein as "Licensee's Market".
Licensee's Territory is the United States, Canada, Mexico and all countries in
Central America, the Caribbean and South America. This license shall be
non-divisible and non-transferable without Licensor's prior consent. Nothing
herein contained shall be construed to bar the Licensor from selling products
bearing the Trademark in any market or anywhere in the world. Licensee agrees
that it will not sell Products bearing the Trademark in any market or territory
other than the Licensee's Market and Territory.
6. MAINTENANCE OF TRADEMARK.
-------------------------
Licensor owns title to the Trademark and believes the use of the Trademark
on the Products in Licensee's Market and Territory will not constitute an
infringement of any other trademark used by a third party. In the event that
Licensee receives notice, or is informed of any claim, suit or demand against
Licensee on account of any alleged infringement relating to its use of the
Trademark owned by Licensor and used by Licensee in accordance with the terms of
this Agreement, Licensee shall promptly notify Licensor of any such claim, suit
or demand. Thereupon, Licensor shall take such action as it may deem necessary
to protect and defend Licensee against any such claim by any third party and
shall indemnify Licensee against any loss, costs or expenses incurred in
connection therewith. Licensee shall not settle or compromise any such claim by
a third party without the prior written consent of Licensor. Licensor shall have
the sole right to defend, compromise or settle any
Exhibit 99.7
4
such claim, in its discretion, at Licensor's sole cost and expense, using
attorneys of its own choosing, and Licensee agrees to cooperate fully with
Licensor in connection with the defense of any such claim. Licensee may
participate at its own expense in such defense or settlement, but Licensor's
decision with regard thereto shall be final.
7. DURATION OF LICENSE.
-------------------
(a) This agreement and the license granted hereby shall take effect on the
date hereof and unless sooner terminated, this agreement and the
license granted hereby shall remain in full force and effect as long
as AUDIOVOX CORPORATION owns more than fifty (50%) percent of the
issued and outstanding shares of Licensee.
(b) Notwithstanding any other provision of this agreement, either party
shall have the right to terminate this agreement upon written notice
to the other for failure to comply with any provision of this
agreement, provided, however, that the party so notified shall have
the right to cure any such default during a period of 60 days
following the mailing of the notice of default, and that upon such
correction, the said notice of termination shall have no further force
or effect.
(c) The license granted hereby shall terminate forthwith and without prior
notice in the event that Licensee shall make any assignment of its
assets or business for the benefit of creditors or shall take the
benefit of any insolvency statute of the United States or any country,
or if a trustee or receiver be appointed to administer or conduct its
business or affairs, or if it be adjudged a bankrupt in any legal
proceeding, or if any involuntary petition under any insolvency
statute of the United States be filed against Licensee which shall not
have been dismissed within thirty (30) days following the filing
thereof.
Exhibit 99.7
5
(d) This agreement and the license granted hereby shall terminate
forthwith and without prior notice in the event of the termination or
dissolution of the Licensee.
8. OWNERSHIP OF TRADEMARK.
----------------------
Licensee acknowledges that Licensor is the sole and exclusive owner of all
right, title and interest in and to the Trademark and all variations and
derivations thereof. Licensee recognizes the value of the goodwill associated
with the Trademark and acknowledges that all rights in and the goodwill
pertaining to the Trademark, belong exclusively to Licensor. Licensee agrees
that during the term of this Agreement, or thereafter, it will not attack the
title or any rights of Licensor in the Trademark or otherwise take any action to
damage the Trademark or the validity of the license. Licensee's use of the
Trademark shall inure to the benefit of Licensor for trademark purposes.
Licensee shall not, at any time, acquire any rights in the Trademark by virtue
of any use it may make of the Trademark. Licensee shall use the Trademark with
such words qualifying or identifying that Licensee's use of the Trademark is
pursuant to this license agreement.
Licensee further acknowledges that it has not obtained and will not obtain
any ownership, right, title or interest in or to the Trademark by reason of the
fact that the Trademark or the word "AUDIOVOX" was used or will be used in the
name under which the Licensee was formed or authorized to conduct business.
Upon termination of the license granted by this agreement for any reason
whatsoever, Licensee will immediately cease and desist from any and all use of
the Trademark for all purposes including but not limited to the sale,
distribution and service of the Product. In addition, Licensee at its own
expense will immediately take whatever steps are necessary and file whatever
applications,
Exhibit 99.7
6
amendments or documents necessary with the proper office of the State of
Delaware or any other jurisdiction in which Licensee has recorded the word
"AUDIOVOX" as part of its corporate name, to effect a change of its corporate
name to a name without and dissimilar to the word "AUDIOVOX".
Licensee further agrees that in the event of such termination, Licensee
will at no time adopt or use any word or xxxx which is likely to be similar to
or confusing with the Trademark.
Nothing contained in this agreement shall be construed as an assignment to
Licensee of any right, title or interest in and to the Licensed Trademark, it
being understood that all right, title and interest relating thereto are
expressly reserved by Licensor except for the rights being licensed hereunder,
and as to such rights, only as expressly herein limited.
9. BOOKS AND RECORDS.
-----------------
Licensee will keep accurate books and records covering all activities
relating to the license being granted.
10. NOTICES.
-------
Any notice required or permitted to be given by either party to the other
under this agreement shall be deemed sufficiently given upon delivery in person
or upon mailing by registered or certified mail, postage prepaid, return receipt
requested, addressed to the party to be notified at its address shown at the
beginning of this agreement or at such other address as may be furnished by
notice similarly given.
11. MISCELLANEOUS.
-------------
This agreement may not be orally modified and no amendment thereof shall be
Exhibit 99.7
7
effective except upon the signature of a duly authorized representative of each
of the parties hereto.
12. COUNTERPARTS.
------------
This Agreement may be executed in one or more counterparts, each of which
is to be deemed an original, and all of which constitute, collectively, one
agreement.
Exhibit 99.7
8
IN WITNESS WHEREOF, this Agreement has been executed by the duly authorized
representatives of the parties hereto as of the day and year first written
above.
AUDIOVOX COMMUNICATIONS CORP.
(Licensee)
By: s/ Xxxxxx Xxxxxxxxxxx
-----------------------------------------
Its: Chief Executive Officer
AUDIOVOX CORPORATION
(Licensor)
By: s/ Xxxx X. Xxxxxx
-----------------------------------------
Its: Chief Executive Officer
Exhibit 99.7
9
