EXHIBIT 7m
PROMOTIONAL LICENSE
WARNER BROS. CONSUMER PRODUCTS
#12053-WBLT
PROMOTIONAL LICENSE AGREEMENT made July 21, 2000 by and between WARNER
BROS., A DIVISION OF TIME WARNER ENTERTAINMENT COMPANY L.P., c/o Warner
Bros. Consumer Products, a Division of Time Warner Entertainment Company
L.P., whose address is ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereinafter
referred to as "LICENSOR") and Bravo! Foods, Inc. a wholly owned subsidiary
of China Premium Food Corporation, whose address is ▇▇▇▇ ▇.▇. ▇▇▇▇▇▇▇ ▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: ▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇▇
(hereinafter referred to as "LICENSEE").
W I T N E S S E T H :
The parties hereto mutually agree as follows:
1. DEFINITIONS: As used in this Agreement, the following terms
shall have the following respective meanings:
(a) "Channels of Distribution": Licensee may conduct the Licensed
Promotion and produce, distribute and sell the Licensed Products
and/or the Licensed Premiums through the following Channels of
Distribution only (as such channels are defined and numbered in
Exhibit 1 attached hereto and incorporated herein by reference):
CHANNELS: EXHIBIT 1 NUMBER:
Airport Gift and Other Airport Stores 1
Amusement Park Gift Stores limited to Six Flags only 3
Chain Drug Stores 13
Chain Toy Stores 15
College/University Stores 17
Convenience Stores 20
Educational Institutions 25
Food Service 31
Gourmet Food Specialty Stores 35
Ice Cream Stores 41
In-Store Bakeries 42
Military Exchange Services limited to AAFES only 46
Music/Video Stores 47
National Discount/Mass Retailers 48
Non-Chain Drug Stores 51
Regional Discount/Mass Retailers 62
Supermarket/Grocery Stores 70
Vending Machines 78
Warehouse Clubs 79
It is understood and agreed that distribution shall commence in
Arizona, Colorado, Pennsylvania, Tennessee and Wyoming.
All other Channels of Distribution defined in Exhibit 1 which are
not specified above in this Paragraph 1(a) are specifically
excluded from this Agreement.
(b) "Guaranteed Consideration":
(i) With respect to the Initial Term as set forth below, Licensee
shall pay to Licensor the sum of $500,000, payable as
follows:
$250,000 payable simultaneously with the execution of this
Agreement;
$100,000 payable on or before June 1, 2001;
$100,000 payable on or before December 1, 2001; and
$50,000 payable on or before June 1, 2002.
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(ii) With respect to the Renewal Term, if any, as set forth below,
Licensee shall pay to Licensor an additional sum which shall
be determined at a later date.
(c) "Licensed Premium(s)": Licensee shall have the right to include
premiums incorporating the Licensed Property in association with
the Licensed Promotion. Any and all such premiums shall be
determined by the parties at a later date, provided, however, that
Licensor shall have the absolute right to approve in writing all
the elements (i.e. all premiums as well as all product packaging,
advertising, etc.) prior to manufacture of said premiums.
For purposes of this subparagraph, the term "premium" shall be
defined as including, but not necessarily limited to, combination
sales, free or self-liquidating items offered to the public in
conjunction with the sale or promotion of a product or service,
including traffic building or continuity visits by the
consumer/customer, or any similar scheme or device, the prime
intent of which is to use the premiums in such a way as to
promote, publicize and or sell the products, services or business
image of the user of such item.
(d) "Licensed Products": Branded Milk Products.
(e) "Licensed Promotion": The right to utilize the Licensed Property
in connection with the advertising and promotion of the Licensed
Products and with the manufacture, distribution and advertisement
of Licensed Premiums.
(f) "Licensed Property": The fictional cartoon characters BUGS BUNNY,
TWEETY, TASMANIAN DEVIL, ROAD RUNNER, WILE E. COYOTE, LOLA BUNNY,
▇▇▇▇▇▇ THE ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, and DAFFY DUCK which constitute
"LOONEY TUNES", including the names of said characters and all
trademarks, copyrights, environmental settings and artwork
associated therewith. Licensee specifically understands and agrees
that no rights are granted herein with respect to the Warner Bros.
"BABY LOONEY TUNES" or "BABY LOONEY TUNES CLASSIC COLLECTION"
properties, it being understood that all rights in and to said
property are reserved exclusively to Licensor for use and/or
licensing as it deems appropriate to third parties of its choice.
Licensee further understands and agrees that the rights granted
herein are limited only to the cartoon characters set forth above
and that any and all rights in, to or associated with any
theatrical motion picture containing the "LOONEY TUNES" cartoon
characters, whether live action, animation or both, as well as
with any sequels thereto, are specifically excluded herefrom, it
being understood that all rights in and to said property are
reserved exclusively to Licensor for use and/or licensing as it
deems appropriate to third parties of its choice.
(g) "Marketing Date": September 1, 2000.
(h) "Royalty Rate": Licensee shall pay to Licensor the following sums:
i) Five Percent (5%) of Net Sales (as defined in Paragraph 4(b)
below) of all Licensed Products; and
ii) Ten Percent (10%) of Net Purchase Price of all Licensed
Premiums distributed by Licensee hereunder. The term "Net
Purchase Price" herein shall mean the price actually paid by
Licensee for any Licensed Premium(s) authorized and
distributed hereunder.
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(i) "Term":
(i) "Initial Term": January 1, 2000 through December 31, 2002.
(ii) "Renewal Term": Licensee shall have the option to renew this
Agreement for up to one (1) two-year period, provided that
Licensee gives written notice to Licensor no later than sixty
(60) days before the end of the Initial Term (the "Decision
Due Date") and provided that Licensee meets the following
requirements:
(a) Licensee has faithfully performed each and every
material obligation of this Agreement during the Initial
Term referred to above;
(b) Licensee shall have earned, under the provisions of
Paragraph l(b) hereof, and paid to Licensor, no less
than five hundred thousand ($500,000) during the Initial
Term;
(c) Licensee has spent and provides proof by the Decision
Due Date that it has spent a minimum of three percent
(3%) of wholesale sales on promotions and advertising
the Licensed Products at over a thirty percent (30%) all
commodity volume (ACV) distribution level.
(j) "Territory": United States (fifty states), Puerto Rico, and United
States Virgin Islands.
(k) "Third Party Contracts": Pursuant to Paragraph 10(b), Licensor and
Licensee acknowledge that Licensee will enter into a non-exclusive
"Promotional Contract" with Quality Checd Dairies, Inc. and
several "Production Contracts" with both Quality Checkd member
dairies and dairies that are not members of Quality Checkd.
(i) The "Promotional Contract" shall provide for the
administration of the promotion, production and distribution
of the Licensed Products by Quality Checd member dairies,
including promotional, administrative, marketing, product
development and logistical support for such member dairies by
Licensee and Quality Checd. For an incremental fee (which fee
shall be included within "net sales" hereunder) based upon
the wholesale cost to such member dairies of producing four
thousand (4,000) pints of the Licensed Products, Licensee and
Quality Checd shall provide ingredient formulas to Quality
Checd member dairies pursuant to the Promotional Contract, as
well as advertising and promotional support for the
production and sale of the Licensed Products.
(ii) The "Production Contracts" shall provide for the production
and sales of the Licensed Products on a non-exclusive basis
with both Quality Checd member dairies and non-member
dairies. For an incremental fee (which fee shall be included
within "net sales" hereunder) based upon wholesale cost to
such non-member dairies of producing four thousand (4,000)
pints of the Licensed Products, Licensee and Quality Checd
shall provide ingredient formulas to such non-member dairies
and Licensee shall provide advertising and promotional
support for the production and sale of the Licensed Products.
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2. GRANT OF LICENSE:
(a) Subject to the restrictions, limitations, reservations and
conditions and Licensor's approval rights set forth in this
Agreement, Licensor hereby grants to Licensee and Licensee hereby
accepts for the Term of this Agreement, a license to utilize the
Licensed Property solely on or in connection with the Licensed
Promotion and the Licensed Products and/or Licensed Premiums
throughout the Territory on a non-exclusive basis.
(b) Without limiting any other approval rights of Licensor as
contained herein, no television commercials (animated or live
action) may be utilized under this Agreement without the specific
prior written approval of Licensor.
3. RESERVATION OF RIGHTS; PREMIUMS:
(a) Licensor reserves all rights not expressly conveyed to Licensee
hereunder, and Licensor may grant licenses to others to use the
Licensed Property, artwork and textual matter in connection with
other uses, services and products without limitation.
(b) Notwithstanding anything to the contrary stated herein, Licensor
specifically reserves the right, without limitation throughout the
world, to itself use, or license any third party(s) of its choice
to use the Licensed Property for the manufacture, distribution and
sale of products and/or the promotion of services similar or
identical to those licensed herein in Paragraphs l(c) and l(d)
above for sale through any catalogue(s) produced or distributed by
or on behalf of Licensor or its affiliated companies, or for sale
or distribution in any theaters or arenas, or for sale or
distribution in any retail stores operated by or on behalf of
Licensor, its affiliated companies or franchisees, or for sale or
distribution in any theme/amusement parks operated by or on behalf
of Licensor or its licensees, Six Flags, Premier Parks, Movie
World, or their affiliated companies. In addition, Licensor
reserves the right to allow Six Flags, Premier Parks and Movie
World to manufacture (or have manufactured by a third party)
products similar or identical to those licensed herein for
distribution or sale in theme and/or amusement parks owned or
operated by Six Flags, Premier Parks and/or Movie World. Further,
Licensor, reserves the right to use, or license others to use,
and/or manufacture products similar or identical to those licensed
herein for use as premiums.
(c) Licensee specifically understands and agrees that no rights are
granted herein with respect to the Warner Bros. "shield" logo or
trademark, or any other trademark(s), logo(s) or copyrights owned
by Licensor other than those specifically set forth above in the
Licensed Property, it being understood that all rights in and to
said properties are reserved exclusively to Licensor for use
and/or licensing as it deems appropriate to third party(s) of its
choice.
(d) Licensee agrees that it will not use, or knowingly permit the use
of, and will exercise due care that its customers likewise will
refrain from the use of, the Licensed Products as premiums or the
Licensed Premiums as products for retail sale, except with the
prior written consent of Licensor.
4. CONSIDERATION:
(a) The Guaranteed Consideration paid by Licensee as set forth above
shall be applied against such royalties as are, or have become,
due to Licensor. No part of such Guaranteed Consideration shall be
repayable to Licensee. Royalties earned in excess of the
Guaranteed
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Consideration applicable to the Term hereof shall not offset any
Guaranteed Consideration required in respect of the succeeding renewal
term (if any); likewise, royalties earned in excess of the Guaranteed
Consideration applicable to the renewal term (if any) shall not offset
any Guaranteed Consideration applicable to any prior term.
(b) Royalty Payments: Licensee shall pay to Licensor a sum equal to
the Royalty Rate as set forth above of (i) all Net Sales by
Licensee of the Licensed Products and/or (ii) Net Purchase Price
of the Licensed Premiums covered by this Agreement. The term "net
sales" herein shall mean the gross invoice price billed to dairies
producing, distributing and selling the Licensed Products, less
actual quantity discounts and actual returns, but no deductions
shall be made for uncollectible accounts and deductions for actual
returns may not exceed five percent (5%) of total billing on a
dairy by dairy basis, computed quarterly. No costs incurred in the
manufacture, sale, distribution, advertisement, or exploitation of
the Licensed Products shall be deducted from any royalties payable
by Licensee.
(c) Royalties shall be payable concurrently with the periodic
statements required in Paragraph 5(a) hereof, except to the extent
offset by the Guaranteed Consideration theretofore remitted.
5. PERIODIC STATEMENTS:
(a) Within thirty (30) days after the initial shipment of the Licensed
Products and/or Licensed Premiums and promptly on the fifteenth
(15th) day of every quarter thereafter, Licensee shall furnish to
Licensor complete and accurate statements certified to be accurate
by Licensee, or if a corporation, by an officer of Licensee,
showing the (i) number of units; (ii) country in which
manufactured, sold, distributed and/or to which shipped; (iii)
Description (as such term is defined below) of the Licensed
Products and/or Licensed Premiums; (iv) gross sales price or Net
Purchase Price (if applicable); and (v) itemized deductions from
gross sales price and net sales price (if applicable) together
with any returns made during the preceding calendar quarter. Such
statements shall be furnished to Licensor whether or not any of
the Licensed Products and/or Licensed Premiums have been
distributed during calendar quarters to which such statements
refer. Receipt or acceptance by Licensor of any of the statements
furnished pursuant to this Agreement or of any sums paid hereunder
shall not preclude Licensor from questioning the correctness
thereof at any time, and in the event that any inconsistencies or
mistakes are discovered in such statements or payments, they shall
immediately be rectified and the appropriate payments made by
Licensee. Upon demand of Licensor, Licensee shall at its own
expense, but not more than once in any twelve (12) month period,
furnish to Licensor a detailed statement by an independent
certified public accountant showing the (i) number of units; (ii)
country in which manufactured, sold, distributed and/or to which
shipped; (iii) Description of the Licensed Products and/or
Licensed Premiums; (iv) gross sales price or Net Purchase Price
(if applicable); and (v) itemized deductions from gross sales
price and net sales price (if applicable) of the Licensed Products
and/or Licensed Premiums covered by this Agreement distributed
and/or sold by Licensee up to and including the date upon which
Licensor has made such demand. For purposes of this Paragraph
5(a), the term "Description" shall mean a detailed description of
the Licensed Products and/or Licensed Premiums including the
nature of each of the Licensed Products and/or Licensed Premiums,
any and all names and
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likenesses, whether live actors or animated characters, from the
Licensed Property utilized on the Licensed Products and/or
Licensed Premiums and/or any related packaging and/or wrapping
material, and any other components of the Licensed Property
utilized on the Licensed Products and/or Licensed Premiums and/or
any related packaging and/or wrapping material. In the event
Licensor is responsible for the payment of any additional third
party participations based on Licensee not reporting by character
name and likeness as provided above, Licensee shall be responsible
for reimbursing Licensor for the full amount of all such third
party claims, including without limitation the participation
itself, interest, audit and attorneys' fees. Licensee understands
and agrees that it is a material term and condition of this
Agreement that Licensee include the Description on all statements.
In the event Licensee fails to do so, Licensor shall have the
right to terminate this Agreement, in accordance with the
provisions of Paragraph 14 herein.
(b) For the statements and payments required hereunder (Licensee shall
reference the contract number(s) on all statements and payments)
if the United States Postal Service is used deliver to the
following:
WARNER BROS. CONSUMER PRODUCTS
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
For the statements and payments required hereunder. (Licensee
shall reference the contract number(s) on all statements and
payments) if sent by Federal Express or any other Courier Service
deliver to the following:
FIRST CHICAGO NATIONAL BANK
Attention WBCP lockbox #21477
525 West Monroe
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone Number ▇▇▇-▇▇▇-▇▇▇▇
(c) Any payments which are made to Licensor hereunder after the due
date required therefore, shall bear interest at the then current
prime rate plus six percent (6%) (or the maximum rate permissible
by law, if less than the current prime rate plus six percent (6%))
from the date such payments are due to the date of payment.
Licensor's right hereunder to interest on late payments shall not
preclude Licensor from exercising any of its other rights or
remedies pursuant to this Agreement or otherwise with regard to
Licensee's failure to make timely remittances.
(d) Licensee hereby grants to Licensor (subject to any liens or
security interests granted by Licensee which are approved in
writing by Licensor) a first-priority lien and security interest
in Licensee's inventory, contract rights and accounts receivable,
and all proceeds thereof, with respect to the Licensed Products
only. Licensee further agrees to provide, at Licensor's request:
(i) a letter of credit issued in favor of Licensor from a
financial institution as approved by Licensor in an amount up to
the Guaranteed Consideration; and/or (ii) such other form of
security acceptable to Licensor. Licensee agrees to execute all
documentation as Licensor may require in connection with
perfecting such security interests.
6. BOOKS AND RECORDS:
(a) Licensee shall keep, maintain and preserve (in Licensee's
principal place of business) for at least two (2) years following
termination or expiration of the Term of this Agreement or any
renewal(s) hereof (if applicable), complete and accurate records
of accounts
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including, without limitation, purchase orders, inventory records,
invoices, correspondence, banking and financial and other records
pertaining to the various items required to be submitted by
Licensee as well as to ensure Licensee's compliance with local
laws as required pursuant to Paragraph 13(k) hereof. Such records
and accounts shall be available for inspection and audit at any
time or times during or after the Term of this Agreement or any
renewal(s) hereof (if applicable) during reasonable business hours
and upon reasonable notice by Licensor or its nominees. Licensee
agrees not to cause or permit any interference with Licensor or
nominees of Licensor in the performance of their duties. During
such inspections and audits, Licensor shall have the right to take
extracts and/or make copies of Licensee's records as it deems
necessary.
(b) The exercise by Licensor in whole or in part, at any time of the
right to audit records and accounts or of any other right herein
granted, or the acceptance by Licensor of any statement or
statements or the receipt and/or deposit by Licensor, of any
payment tendered by or on behalf of Licensee shall be without
prejudice to any rights or remedies of Licensor and such
acceptance, receipt and/or deposit shall not preclude or prevent
Licensor from thereafter disputing the accuracy of any such
statement or payment.
(c) If pursuant to its right hereunder Licensor causes an audit and
inspection to be instituted which thereafter discloses a
deficiency between the amount found to be due to Licensor and the
amount actually received or credited to Licensor, then Licensee
shall, upon Licensor's demand, promptly pay the deficiency,
together with interest thereon at the then current prime rate from
the date such amount became due until the date of payment, and, if
the deficiency is more than three percent (3%) of all payments
made by Licensee during the period covered by the audit, then
Licensee shall pay the reasonable costs and expenses of such audit
and inspection.
7. INDEMNIFICATIONS:
(a) During the Term, and continuing after the expiration or
termination of this Agreement, Licensor shall indemnify Licensee
and shall hold it harmless from any loss, liability, damage, cost
or expense arising out of any claims or suits which may be brought
or made against Licensee by reason of the breach by Licensor of
the warranties or representations as set forth in Paragraph 12
hereof, provided that Licensee shall give prompt written notice,
and full cooperation and assistance to Licensor relative to any
such claim or suit and provided, further, that Licensor shall have
the option to undertake and conduct the defense of any suit so
brought. Licensee shall not, however, be entitled to recover for
lost profits. Licensee shall cooperate fully in all respects with
Licensor in the conduct and defense of said suit and/or
proceedings related thereto.
(b) During the Term, and continuing after the expiration or
termination of this Agreement, Licensee shall indemnify Licensor
and shall hold it harmless from any loss, liability, damage, cost
or expense arising out of any claims or suits which may be brought
or made against Licensor by reason of: (i) any breach of
Licensee's covenants and undertakings hereunder; (ii) any
unauthorized use by Licensee of the Licensed Property; (iii) any
use of any trademark, copyright, design, patent, process, method
or device, except for those uses of the Licensed Property that are
specifically approved by Licensor pursuant to the terms of this
Agreement; (iv) Licensee's non-compliance with any
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applicable federal, state or local laws or with any other
applicable regulations; and (v) any alleged defects and/or
inherent dangers (whether obvious or hidden) in the Licensed
Products and/or Licensed Premiums, or the use of such Licensed
Products and/or Licensed Premiums.
(c) With regard to 7(b)(v) above, Licensee agrees to obtain, at its
own expense, product liability insurance providing adequate
protection for Licensor and Licensee against any such claims or
suits in amounts no less than three million dollars ($3,000,000)
per occurrence, combined single limits. Simultaneously with the
execution of this Agreement, Licensee undertakes to submit to
Licensor a fully paid policy or certificate of insurance naming
Licensor as an additional insured party and, requiring that the
insurer shall not terminate or materially modify such policy or
certificate of insurance without written notice to Licensor at
least twenty (20) days in advance thereof. Such insurance and
delivery of the policy or certificate are material obligations of
Licensee.
8. ARTWORK; COPYRIGHT AND TRADEMARK NOTICES:
(a) The Licensed Property shall be displayed or used only in such form
and in such manner as has been specifically approved in writing by
Licensor in advance and Licensee undertakes to assure usage of the
trademark(s) and character(s) solely as approved hereunder.
Licensee further agrees and acknowledges that any and all Artwork
(defined below) created, utilized, approved and/or authorized for
use hereunder by Licensor in connection with the Licensed Products
and/or Licensed Premiums or which otherwise features or includes
the Licensed Property shall be owned in its entirety exclusively
by Licensor. "Artwork" as used herein shall include, without
limitation, all pictorial, graphic, visual, audio, audio-visual,
digital, literary, animated, artistic, dramatic, sculptural,
musical or any other type of creations and applications, whether
finished or not, including, but not limited to, animation,
drawings, designs, sketches, images, tooling and tooling aids,
illustrations, film, video, electronic, digitized or computerized
information, software, object code, source code, on-line elements,
music, text, dialogue, stories, visuals, effects, scripts,
voiceovers, logos, one-sheets, promotional pieces, packaging,
display materials, printed materials, photographs, interstitials,
notes, shot logs, character profiles and translations, produced by
Licensee or for Licensee, pursuant to this Agreement. Licensor
reserves for itself or its designees all rights to use any and all
Artwork created, utilized and/or approved hereunder without
limitation.
(b) Licensee acknowledges that, as between Licensor and Licensee, the
Licensed Property and Artwork and all other depictions expressions
and derivations thereof, and all copyrights, trademarks and other
proprietary rights therein are owned exclusively by Licensor and
Licensee shall have no interest in or claim thereto, except for
the limited right to use the same pursuant to this Agreement and
subject to its terms and conditions.
Licensee agrees and acknowledges that any Artwork created by
Licensee or for Licensee hereunder is a "work made for hire" for
Licensor under the U.S. Copyright Act, and any and all similar
provisions of law under other jurisdictions, and that is the
author of such works for all purposes, and that is the exclusive
owner of all the rights comprised in the undivided copyright and
all renewals, extensions and reversions therein, in and to such
works in perpetuity
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and throughout the universe. Licensee hereby waives and releases
in favor of all rights (if any) of "droit moral," rental rights
and similar rights in and to the Artwork (the "Intangible Rights")
and agrees that Licensor shall have the right to revise, condense,
abridge, expand, adapt, change, modify, add to, subtract from, re-
title, re-draw, re-color, or otherwise modify the Artwork, without
the consent of Licensee. Licensee hereby irrevocably grants,
transfers and assigns to Licensor all right, title and interest,
including copyrights, trademark rights, patent rights and other
proprietary rights, it may have in and to the Artwork, in
perpetuity and throughout the universe, and to all proprietary
depictions, expressions or derivations of the Licensed Property
created by or for Licensee. Licensee acknowledges that Licensor
shall have the right to terminate this Agreement in the event
Licensee asserts any rights (other than those specifically granted
pursuant to this Agreement) in or to the Licensed Property or
Artwork.
Licensee hereby warrants that any and all work created by Licensee
under this Agreement apart from the materials provided to Licensee
by Licensor is and shall be wholly original with or fully cleared
by Licensee and shall not copy or otherwise infringe the rights of
any third parties, and Licensee hereby indemnifies Licensor and
will hold Licensor harmless from any such claim of infringement or
otherwise involving Licensee's performance hereunder. At the
request of Licensor, Licensee shall execute such form(s) of
assignment of copyright or other papers as Licensor may reasonably
request in order to confirm and vest in Licensor the rights in
the properties as provided for herein. In addition, Licensee
hereby appoints Licensor as Licensee's Attorney-in-Fact to take
such actions and to make, sign, execute, acknowledge and deliver
all such documents as may from time to time be necessary to
confirm in Licensor, its successors and assigns, all rights
granted herein. If any third party makes or has made any
contribution to the creation of Artwork authorized for use
hereunder, Licensee agrees to obtain from such party a full
confirmation and assignment of rights so that the foregoing rights
shall vest fully in Licensor, in the form of the Contributor's
Agreement attached hereto as Exhibit 2 and by this reference made
a part hereof, prior to commencing work, ensuring that all rights
in the Artwork and Licensed Property arise in and are assigned to
Licensor. Promptly upon entering into each such Agreement,
Licensee shall give Licensor a copy of such Agreement. Licensee
assumes all responsibility for such parties and agrees that
Licensee shall bear any and all risks arising out of or relating
to the performance of services by them and to the fulfillment of
their obligations under the Contributor's Agreement.
(c) Upon expiration of termination of this Agreement for any reason,
or upon demand by Licensor at any time, Licensee shall promptly
deliver to Licensor all Artwork or Licensed Property, whether
finished or not, including drawings, drafts, sketches,
illustrations, screens, data, digital files and information,
copies or other items, information or things created in the course
of preparing the Licensed Property and all materials provided to
Licensee by Licensor hereunder, or, at Licensor's option and
instruction, shall destroy some or all of the foregoing and shall
confirm to Licensor in writing that Licensee has done so. Licensee
shall not use such Artwork or Licensed Property, items,
information or things, material, for any purpose other than is
permitted under this Agreement.
(d) Licensee shall, within thirty (30) days of receiving an invoice,
pay Licensor for artwork executed for Licensee
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by Licensor (or by third parties under contract to Licensor) at
Licensee's request for use in the development of the Licensed
Products and/or Licensed Premiums and any related packaging,
display and promotional materials at Licensor's prevailing
commercial art rates. The foregoing shall include any artwork
that, in Licensor's opinion, is necessary to modify artwork
initially prepared by Licensee and submitted for approval.
Estimates of artwork charges are available upon request.
(e) Licensee shall cause to be imprinted, irremovably and legibly on
each Licensed Product and/or Licensed Premium manufactured,
distributed or sold under this Agreement, and all printed and/or
televised advertising, promotional, packaging and wrapping
material wherein the Licensed Property appears, the following
copyright and/or trademark notice(s) or such other notice as may
be approved by Licensor:
LOONEY TUNES, characters, names, and all related indicia are
trademarks of Warner Bros. (C)200_.
(The year date shall be as instructed by Licensor.)
(f) In no event shall Licensee use, in respect to the Licensed
Products and/or Licensed Premiums and/or in relation to any
advertising, promotional, packaging or wrapping material, any
copyright or trademark notices which shall conflict with, be
confusing with, or negate, any notices required hereunder by
Licensor in respect to the Licensed Property.
(g) Licensee agrees to deliver to Licensor free of cost six (6) of
each of the Licensed Premiums together with their packaging and
wrapping material for trademark registration purposes in
compliance with applicable laws, simultaneously upon distribution
to the public. Any copyrights or trademarks with respect to the
Licensed Promotion or Licensed Products and/or Licensed Premiums
shall be procured by and for the benefit of Licensor and at
Licensor's expense. Licensee further agrees to provide Licensor
with the date of the first use of the Licensed Products and/or
Licensed Premiums in interstate and intrastate commerce.
(h) Licensee shall assist Licensor, at Licensor's expense, in the
procurement, protection, and maintenance of Licensor's rights to
the Licensed Property. Licensor may, in its sole discretion,
commence or prosecute and effect the disposition of any claims or
suits relative to the imitation, infringement and/or unauthorized
use of the Licensed Property either in its own name, or in the
name of Licensee, or join Licensee as a party in the prosecution
of such claims or suits. Licensee agrees to cooperate fully with
Licensor in connection with any such claims or suits and
undertakes to furnish full assistance to Licensor in the conduct
of all proceedings in regard thereto. Licensee shall promptly
notify Licensor in writing of any infringements or imitations or
unauthorized uses by others of the Licensed Property, on or in
relation to promotions similar to the Licensed Promotion or
products identical to similar to or related to the Licensed
Products and/or Licensed Premiums. Licensor shall in its sole I
discretion have the right to settle or effect compromises in
respect thereof. Licensee shall not institute any suit or take any
action on account of such infringements, imitations or
unauthorized uses.
9. APPROVALS AND QUALITY CONTROLS:
(a) Licensee agrees to strictly comply and maintain compliance with
the quality standards, specifications and rights of approval of
Licensor in respect to any and all usage of the Licensed Property
on or in
10
relation to the Licensed Products and/or Licensed Premiums
throughout the Term of this Agreement and any renewals or
extensions thereof (if applicable) . Licensee agrees to furnish to
Licensor free of cost for its written approval as to quality and
style, samples of each of the Licensed Products and/or Licensed
Premiums, together with their packaging, hangtags, and wrapping
material, as follows in the successive stages indicated: (i) rough
sketches/layout concepts; (ii) finished artwork or final proofs;
(iii) pre-production samples or strike-offs; and (iv) finished
products, including packaged samples.
(b) No Licensed Products and/or Licensed Premiums and no material
utilizing the Licensed Property shall be manufactured, sold,
distributed or promoted by Licensee without prior written
approval. In addition to the foregoing, Licensee understands that
it shall furnish to Licensor, scripts and storyboards of any
proposed media use of the Licensed Property as may be authorized
hereunder, in sufficient time for Licensee to make all revisions
which Licensor in its sole discretion may request. Licensee may,
subject to Licensor's prior written approval, use textual and/or
pictorial matter pertaining to the Licensed Property on
promotional, display and advertising material as may, in its
reasonable judgment, promote the sale of the Licensed Products
and/or Licensed Premiums. All advertising and promotional
materials relating to the Licensed Promotion and Licensed Products
and/or Licensed Premiums must be submitted to the Licensor for its
written approval at the following stages appropriate to the medium
used. For print materials, submissions are to be made at the
following stages: (a) rough sketches or layout concepts; (b)
finished artwork or final proofs; and (c) finished materials. For
television commercials, if approved by Licensor, submissions are
to be made at the following stages: (a) initial concept; (b)
storyboard, including written text; (c) pencil tests and voice-
overs for animation and/or selection of performers for live
action; and (d) a cassette of the finished commercial prior to air
date. For radio or other audio materials, if approved by Licensor,
submissions are to be made at the following stages: (a) initial
concept; (b) script; (c) voice-overs; and (d) a cassette of the
finished commercial prior to the air date.
(c) Approval or disapproval shall lie in Licensor's sole discretion.
Any Licensed Products and/or Licensed Premiums not so approved in
writing shall be deemed unlicensed and shall not be manufactured,
distributed or sold. If any unapproved Licensed Products and/or
Licensed Premiums are being distributed or sold, Licensor may,
together with other remedies available to it including, but not
limited to, immediate termination of this Agreement, require such
Licensed Products and/or Licensed Premiums to be immediately
withdrawn from the market and to be destroyed, such destruction to
be attested to in a certificate signed by an officer of Licensee.
(d) Any modification of a Licensed Product and/or Licensed Premium
must be submitted in advance for Licensor's written approval as if
it were a new Licensed Product and/or Licensed Premium. Approval
of a Licensed Product and/or Licensed Premium which uses
particular artwork does not imply approval of such artwork for use
with a different Licensed Product and/or Licensed Premium.
(e) Licensed Products and/or Licensed Premiums must conform in all
material respects to the final production samples approved by
Licensor. If in Licensor's reasonable judgement, the quality of a
Licensed Product and/or Licensed Premium originally approved has
11
deteriorated in later production runs, or if a Licensed Product
and/or Licensed Premium has otherwise been altered, Licensor may,
in addition to other remedies available to it, require that such
Licensed Product and/or Licensed Premium be immediately withdrawn
from the market.
(f) Licensee shall permit Licensor to inspect Licensee's manufacturing
operations, testing and payroll records (including those
operations and records of any supplier or manufacturer approved
pursuant to Paragraph 10 (b) below) with respect to the Licensed
Products and/or Licensed Premiums.
(g) If any changes or modifications are required to be made to any
material submitted to Licensor for its written approval in order
to ensure compliance with Licensor's specifications or standards
of quality, Licensee agrees promptly to make such changes or
modifications.
(h) Subsequent to final approval, no fewer than twenty-four (24)
production samples of Licensed Products and/or Licensed Premiums
will be sent to Licensor, to ensure quality control simultaneously
on distribution to the public. In addition, Licensor shall have
the right to purchase any and all Licensed Products and/or
Licensed Premiums in any quantity at the maximum discount price
Licensee charges its best customer.
(i) To avoid confusion of the public, Licensee agrees not to associate
other characters or properties with the Licensed Property on the
Licensed Products and/or Licensed Premiums or in any packaging,
promotional or display materials unless Licensee receives
Licensor's prior written approval. Furthermore, Licensee agrees
not to use the Licensed Property (or any component thereof) on any
business sign, business cards, stationery or forms, nor as part of
the name of Licensee's business or any division thereof.
(j) Licensee shall use its best efforts to notify its customers of the
requirement that Licensor has the right to approve all
promotional, display and advertising material pursuant to this
Agreement.
(k) It is understood and agreed that any animation used in electronic
media, including but not limited to animation for television
commercials and character voices for radio commercials, shall be
produced by Warner Bros. Animation pursuant to a separate
agreement between Licensee and Warner Bros. Animation, subject to
Warner Bros. Animation customary rates. It is understood and
agreed that, in the event Licensee utilizes the services of WB
Toys, Licensee shall reimburse WB Toys for all costs and expenses
at WB Toys' customary rates. Any payment made to Warner Bros.
Animation for such animation shall be in addition to and shall not
offset the Guaranteed Consideration set forth in Paragraph l(b).
(l) Licensor's approval of Licensed Products and/or Licensed Premiums
(including, without limitation, the Licensed Products and/or
Licensed Premiums themselves as well as promotional, display and
advertising materials) shall in no way constitute or be construed
as an approval by Licensor of Licensee's use of any trademark,
copyright and/or other proprietary materials not owned by
Licensor.
10. DISTRIBUTION; SUBLICENSE MANUFACTURE:
(a) Licensee may distribute the Licensed Products and/or Licensed
Premiums solely through the Channels of Distribution set forth in
above. Licensee shall not distribute the Licensed Products and/or
Licensed Premiums through any cable home shopping service or
12
through electronic media, including on any on-line network or
service. If Licensee sells or distributes the Licensed Products
and/or Licensed Premiums at a special price, directly or
indirectly, to itself, including without limitation, any
subsidiary of Licensee or to any other person, firm, or
corporation affiliated with Licensee or its officers, directors or
major stockholders, for ultimate sale to unrelated third parties,
Licensee shall pay royalties with respect to such sales or
distribution, based upon the price generally charged the trade by
Licensee.
(b) Licensee shall not be entitled to sublicense any of its rights
under this Agreement. Licensee, however, shall have the right to
enter into Third Party Contracts (as defined in Paragraph l(k))
for the promotion (Promotion Contract), production, distribution
and sale (Production Contract) of the Licensed Products, subject
to the written approval of Licensor, which approval shall not be
unreasonably withheld by Licensor, provided that such promoter or
producer each shall execute a letter in the form of Exhibit 3
attached hereto and by this reference made apart hereof. In such
event, Licensee shall remain primarily obligated under all of the
provisions of this Agreement and any default of this Agreement by
such manufacturer shall be deemed a default by Licensee hereunder.
In no event shall any such third party manufacturer agreement
include the right to grant any rights to subcontractors.
11. GOOD WILL: Licensee recognizes the great value of the publicity and
good will associated with the Licensed Property and, acknowledges that:
(i) such good will is exclusively that of Licensor; and (ii) the
Licensed Property has acquired a secondary meaning as Licensor's
trademarks and/or identifications in the mind of the purchasing public.
Licensee further recognizes and acknowledges that a breach by Licensee
of any of its covenants, agreements or undertakings hereunder will
cause Licensor irreparable damage, which cannot be readily remedied in
damages in an action at law, and may, in addition thereto, constitute
an infringement of Licensor's copyrights, trademarks and/other
proprietary rights in, and to the Licensed Property, thereby entitling
Licensor to equitable remedies and costs.
12. LICENSOR'S WARRANTIES AND REPRESENTATIONS:
Licensor represents and warrants to Licensee that:
(a) It has, and will have throughout the Term of this Agreement, the
right to license the Licensed Property to Licensee in accordance
with the terms and provisions of this Agreement; and
(b) The making of this Agreement by Licensor does not violate any
agreements, rights or obligations of any person, firm or
corporation.
13. LICENSEE'S WARRANTIES AND REPRESENTATIONS:
Licensee represents and warrants to Licensor that, during the Term and
thereafter:
(a) It will not attack the title of Licensor (or third parties that
have granted rights to Licensor) in and to the Licensed Property
or any copyright or trademarks pertaining thereto, nor will it
attack the validity of the license granted hereunder;
(b) It will not harm, misuse or bring into disrepute the Licensed
Property, but on the contrary, will maintain the value and
reputation thereof to the best of its ability;
13
(c) It will conduct the Licensed Promotion as well as manufacture,
promote and distribute the Licensed Products and/or Licensed
Premiums in an ethical manner and in accordance with the terms and
intent of this Agreement, and in compliance with all applicable
government regulations and industry standards;
(d) It will not create any expenses chargeable to Licensor without the
prior written approval of Licensor in each and every instance. It
will not cause or allow any liens or encumbrances to be placed
against, or grant any security interest (except to Licensor as
provided hereunder) in, the Licensed Property and/or Licensee's
inventory, contract rights and/or accounts receivables, and/or
proceeds thereof, with respect to the Licensed Products without
Licensor's prior written consent;
(e) It will protect to the best of its ability its right to
manufacture, promote and distribute the Licensed Products and/or
Licensed Premiums hereunder;
(f) It will at all times comply with all government laws and
regulations, including but not limited to product safety, food,
health, drug, cosmetic, sanitary or other similar laws, and all
voluntary industry standards relating or pertaining to the conduct
of the Licensed Promotion as well as the manufacture,
distribution, advertising or use of the Licensed Products and/or
Licensed Premiums, and shall maintain its appropriate customary
high quality standards during the Term hereof. It shall comply
with any regulatory agencies which shall have jurisdiction over
the Licensed Promotion or Licensed Products and/or Licensed
Premiums and shall procure and maintain in force any and all
permissions, certifications and/or other authorizations from
governmental and/or other official authorities that may be required in
response thereto. Each Licensed Product and/or Licensed Premium and
component thereof distributed hereunder shall comply with all
applicable laws, regulations and voluntary industry standards.
Licensee shall follow reasonable and proper procedures for testing
that all Licensed Products and/or Licensed Premiums comply with
such laws, regulations and standards. Licensee shall permit
Licensor or its designees to inspect testing records and
procedures with respect to the Licensed Products and/or Licensed
Premiums for compliance. Licensed Products and/or Licensed
Premiums that do not comply with all applicable laws, regulations
and standards shall automatically be deemed unapproved and
immediately taken off the market;
(g) It shall, upon Licensor's request, provide credit information to
Licensor including, but not limited to, fiscal year-end financial
statements (profit-and-loss statement and balance sheet) and
operating statements;
(h) It will provide Licensor with the date(s) of first use of the
Licensed Products and/or Licensed Premiums in interstate and
intrastate commerce, where appropriate;
(i) It will, pursuant to Licensor's instructions, duly take any and
all necessary steps to secure execution of all necessary
documentation for the recordation of itself as user of the
Licensed Property in any jurisdiction where this is required or
where Licensor reasonably requests that such recordation shall be
effected. Licensee further agrees that it will at its own expense
cooperate with Licensor in cancellation of any such recordation at
the expiration of this Agreement or upon termination of Licensee's
right to use the Licensed Property. Licensee hereby appoints
Licensor its Attorney-in-Fact for such purpose;
(j) It will not deliver or sell Licensed Products and/or
14
Licensed Premiums outside the Territory or knowingly deliver or
sell Licensed Products and/or Licensed Premiums to a third party
for delivery outside the Territory;
(k) It will not use any labor that violates any local labor laws,
including all wage and hour laws, laws against discrimination and
that it will not use prison, slave or child labor in connection
with the manufacture of the Licensed Products and/or Licensed
Premiums;
(l) It shall not send, share with or otherwise disclose any Artwork to
any third party, including licensees of Licensor, but with the
exception of those parties approved in accordance with Paragraph
10(b), without the prior written consent of Licensor;
(m) It shall at all times comply with all manufacturing, sales,
distribution, retail and marketing policies and strategies
promulgated by Licensor from time-to-time; and
(n) If requested by Licensor to do so, it will utilize specific design
elements of the Licensed Property provided to Licensee by Licensor
on any promotional or advertising materials and/or hangtags,
labels or other materials with respect to the Licensed Products
and/or Licensed Premiums.
14. TERMINATION BY LICENSOR:
(a) Licensor shall have the right to terminate this Agreement without
prejudice to any rights which it may have, whether pursuant to the
provisions of this Agreement, or otherwise in law, or in equity,
or otherwise, upon the occurrence of anyone or more of the
following events (herein called "defaults"):
(i) Licensee defaults in the performance of any of its
obligations provided for in this Agreement; or
(ii) Licensee shall have failed to deliver to Licensor or to
maintain in full force and effect the insurance referred to
in Paragraph 7(c) hereof; or
(iii) Licensee shall fail to make any payments due hereunder on
the date due; or
(iv) Licensee shall fail to deliver any of the statements
required herein or to give access to the premises and/or
license records pursuant to the provisions hereof to
Licensor's authorized representatives for the purposes
permitted hereunder; or
(v) Licensee shall fail to comply with any laws, regulations or
voluntary industry standards as provided in Paragraph 13(f)
or any governmental agency or other body, office or
official vested with appropriate authority finds that the
Licensed Products and/or Licensed Premiums are harmful or
defective in any way, manner or form, or are being
manufactured, sold or distributed in contravention of
applicable laws, regulations or standards, or in a manner
likely to cause harm; or
(vi) Licensee shall be unable to pay its debts when due, or
shall make any assignment for the benefit of creditors, or
shall file any petition under the bankruptcy or insolvency
laws of any jurisdiction, county or place, or shall have or
suffer a receiver or trustee to be appointed for its
business or property, or be adjudicated a bankrupt or an
insolvent; or
15
(vii) Licensee does not commence in good faith to execute the
Licensed Promotion (i.e. manufacture, distribute and sell
each of the Licensed Products and/or Licensed Premiums) and
utilize each character set forth in the Licensed Property
("Character") throughout the Territory on or before the
Marketing Date and thereafter fails to diligently and
continuously execute the Licensed Promotion and utilize
each Character throughout the Territory. Such default and
Licensor's resultant right of termination (or recapture)
shall only apply to the specific Character(s) and/or the
specific aspect of the Licensed Promotion (i.e. a specific
Licensed Product and/or Licensed Premium), which or wherein
Licensee fails to meet said Marketing Date requirement; or
(viii) Licensee shall execute the Licensed Promotion and/or
manufacture, sell or distribute (whichever first occurs)
any of the Licensed Products and/or Licensed Premiums
without the prior written approval of Licensor as provided
in Paragraph 9 hereof; or
(ix) Licensee undergoes a substantial change of management or
control; or
(x) A manufacturer approved pursuant to Paragraph lO(b) hereof
shall sell Licensed Products and/or Licensed Premiums to
parties other than Licensee or engage in conduct, which
conduct if engaged in by Licensee would entitle Licensor to
terminate this Agreement; or
(xi) Licensee delivers or sells Licensed Products and/or
Licensed Premiums outside the Territory or knowingly sells
Licensed Products and/or Licensed Premiums(s) to a third
party who Licensee knows intends to, or who Licensee
reasonably should suspect intends to, sell or deliver such
Licensed Products and/or Licensed Premiums outside the
Territory; or
(xii) Licensee uses any labor that violates any local labor laws
and/or it uses prison, slave or child labor in connection
with the manufacture of the Licensed Products and/or
Licensed Premiums; or
(xiii) Licensee has made a material misrepresentation or has
omitted to state a material fact necessary to make the
statements not misleading; or
(xiv) Licensee shall breach any other agreement in effect between
Licensee on the one hand and Licensor on the other.
(b) In the event any of these defaults occur, Licensor shall give
notice of termination in writing to Licensee by facsimile and
certified mail. Licensee shall have ten (10) days from the date of
giving notice in which to correct any of these defaults (except
subdivisions (vii), (viii), (xi) and (xiii) above which are not
curable), and failing such, this Agreement shall thereupon
immediately terminate, and any and all payments then or later due
from Licensee hereunder (including Guaranteed Consideration) shall
then be promptly due and payable in full and no portion of those
prior payments shall be repayable to Licensee.
15. FINAL STATEMENT UPON TERMINATION OR EXPIRATION: Licensee shall deliver,
as soon as practicable, but not later than thirty (30) days following
expiration or termination of this Agreement, a statement indicating the
number and description of Licensed Products and/or Licensed Premiums on
hand together with a description of all advertising and promotional
materials relating thereto. Following expiration
16
or termination of this Agreement, Licensee shall immediately cease any
and all manufacturing of the Licensed Products and/or Licensed Premium.
However, if Licensee has complied with all the terms of this Agreement,
including, but not limited to, complete and timely payment of the
Guaranteed Consideration and Royalty Payments, then Licensee may
continue to distribute its remaining inventory for a period not to
exceed sixty (60) days following such termination or expiration (the
"Sell-Off Period"), subject to payment of applicable royalties thereto.
In no event, however, may Licensee distribute during the Sell-Off
Period an amount of Licensed Products and/or Licensed Premiums that
exceeds the average amount of Licensed Products and/or Licensed
Premiums distributed during any consecutive sixty (60) day period
during the Term. In the event this Agreement is terminated by Licensor
for any reason under this Agreement, Licensee shall be deemed to have
forfeited its Sell-Off Period. If Licensee has any remaining inventory
of the Licensed Products and/or Licensed Premiums following the Sell-
Off Period, Licensee shall, at Licensor's option, make available such
inventory to Licensor for purchase at or below cost, deliver up to
Licensor for destruction said remaining inventory or furnish to
Licensor an affidavit attesting to the destruction of said remaining
inventory. Licensee shall, at Licensor's option, deliver to Licensor at
no charge all tooling, tooling aids and other Artwork related to the
Licensed Products, deliver up to Licensor for destruction said tooling,
tooling aids and other Artwork or furnish to Licensor an affidavit
attesting to the destruction of said tooling, tooling aids and other
Artwork. Licensor shall have the right to conduct a physical inventory
in order to ascertain or verify such inventory and/or statement. In the
event that Licensee refuses to permit Licensor to conduct such physical
inventory, Licensee shall forfeit its right to the Sell-Off Period
hereunder or any other rights to dispose of such inventory. In addition
to the forfeiture, Licensor shall have recourse to all other legal
remedies available to it.
16. NOTICES: Except as otherwise specifically provided herein, all notices
which either party hereto is required or may desire to give to the
other shall be given by addressing the same to the other at the address
set forth above, or at such other address as may be designated in
writing by any such party in a notice to the other given in the manner
prescribed in this paragraph. All such notices shall be sufficiently
given when the same shall be deposited so addressed, postage prepaid,
in the United States mail and/or when the same shall have been
delivered, so addressed, by facsimile or by overnight delivery service
and the date of transmission by facsimile, receipt of overnight
delivery service or two business days after mailing shall for the
purposes of this Agreement be deemed the date of the giving of such
notice.
17. NO PARTNERSHIP, ETC.: This Agreement does not constitute and shall not
be construed as constitution of a partnership or joint venture between
Licensor and Licensee. Neither party shall have any right to obligate
or bind the other party in any manner whatsoever, and nothing herein
contained shall give, or is intended to give, any rights of any kind to
any third persons.
18. NO SUBLICENSING/NON-ASSIGNABILITY: This Agreement shall bind and inure
to the benefit of Licensor, its successors and assigns. This Agreement
is personal to Licensee. Licensee shall not sublicense, franchise or
delegate to third parties its rights hereunder (except as set forth in
Paragraph lO(b) hereof) Neither this Agreement nor any of the rights of
Licensee hereunder shall be sold, transferred or assigned by Licensee
and no rights hereunder shall devolve by operation of law or otherwise
upon any receiver, liquidator, trustee or other party.
19. BANKRUPTCY RELATED PROVISIONS:
(a) The parties hereby agree and intend that this Agreement is an
executory contract governed by Section 365 of the
17
Bankruptcy Code.
(b) In the event of Licensee's bankruptcy, the parties intend that any
royalties payable under this Agreement during the bankruptcy
period be deemed administrative claims under the Bankruptcy Code
because the parties recognize and agree that the bankruptcy
estates's enjoyment of this Agreement will (i) provide a material
benefit to the bankruptcy estate during its reorganization and
(ii) deny Licensor the benefit of the exploitation of the rights
through alternate means during the bankruptcy reorganization.
(c) The parties acknowledge and agree that any delay in the decision
of trustee of the bankruptcy estate to assume or reject the
Agreement (the "Decision Period") materially ▇▇▇▇▇ Licensor by
interfering with Licensor's ability to alternatively exploit the
rights granted under this Agreement during a Decision Period of
uncertain duration. The parties recognize that arranging
appropriate alternative exploitation would be a time consuming and
expensive process and that it is unreasonable for Licensor to
endure a Decision Period of extended uncertainty. Therefore, the
parties agree that the Decision Period shall not exceed sixty (60)
days.
(d) Licensor, in its interest to safeguard its valuable interests
(including, without limitation, its intellectual property rights
in the Licensed Property), has relied on the particular skill and
knowledge base of Licensee. Therefore, the parties acknowledge and
agree that in a bankruptcy context this Agreement is a license of
the type described by Section 365(c)(1) of the Bankruptcy Code and
may not be assigned without the prior written consent of the
Licensor.
20. CONSTRUCTION: This Agreement shall be construed in accordance with the
laws of the State of California of the United States of America without
regard to its conflicts of laws provisions.
21. WAIVER, MODIFICATION ETC.: No waiver, modification or cancellation of
any term or condition of this Agreement shall be effective unless
executed in writing by the party charged therewith. No written waiver
shall excuse the performance of any acts other than those specifically
referred to therein. The fact that the Licensor has not previously
insisted upon Licensee expressly complying with any provision of this
Agreement shall not be deemed to be a waiver of Licensor's future right
to require compliance in respect thereof and Licensee specifically
acknowledges and agrees that the prior forbearance in respect of any
act, term or condition shall not prevent Licensor from subsequently
requiring full and complete compliance thereafter. If any term or
provision of this Agreement is held to be invalid or unenforceable by
any court of competent jurisdiction or another authority vested with
jurisdiction, such holding shall not affect the validity or
enforceability of any other term or provision hereto and this Agreement
shall be interpreted and construed as if such term or provision, to the
extent the same shall have been held to be invalid, illegal or
unenforceable, had never been contained herein. Headings of paragraphs
herein are for convenience only and are without substantive
significance.
22. ENTIRE AGREEMENT: This Agreement, including Exhibits, constitutes the
entire Agreement between the parties concerning the subject matter
hereof and cancels and supersedes any prior understandings and
agreements between the parties hereto with respect thereto. There are
no representations, warranties, terms, conditions, undertakings or
collateral agreements, expressed, implied or statutory, between the
parties other than as expressly set forth in this Agreement.
23. ACCEPTANCE BY LICENSOR: This instrument, when signed by
18
Licensee shall be deemed an application for license and not a binding
agreement unless and until accepted by Warner Bros. Consumer Products
by signature of a duly authorized officer and the delivery of such a
signed copy to Licensee. The receipt and/or deposit by Warner Bros.
Consumer Products of any check or other consideration given by Licensee
and/or delivery of any material by Warner Bros. Consumer Products to
Licensee shall not be deemed an acceptance by Warner Bros. Consumer
Products of this application. The foregoing shall apply to any
documents relating to renewals or modifications hereof.
This Agreement shall be of no force or effect unless and until it is
signed by all of the parties listed below:
AGREED AND ACCEPTED: AGREED AND ACCEPTED:
LICENSOR: LICENSEE:
WARNER BROS. CONSUMER PRODUCTS, BRAVO! FOODS, INC.
a Division of Time Warner
Entertainment Company L.P. on
behalf of itself and as Agent for
Warner Bros., a Division of Time
Warner Entertainment Company L.P.
By: By:
------------------------------ --------------------------
▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice President & General Counsel
Date: July 27, 2000 Date: July 21, 2000
---------------------------- ------------------------------
19
Exhibit 1 #12053-WBLT
CHANNELS OF DISTRIBUTION
DEFINITIONS
LICENSEE MAY SELL THE LICENSED PRODUCTS ONLY THROUGH THE CHANNELS OF
DISTRIBUTION AS SPECIFIED ABOVE IN PARAGRAPH l(a) OF THIS LICENSE AGREEMENT
AND AS SUCH CHANNELS ARE DEFINED IN THIS EXHIBIT 1. ALL OTHER CHANNELS OF
DISTRIBUTION DEFINED IN THIS EXHIBIT 1, WHICH ARE NOT SPECIFIED IN
PARAGRAPH l(a) ABOVE, ARE SPECIFICALLY EXCLUDED FROM THIS LICENSE
AGREEMENT.
1. "Airport Gift and Other Airport Stores" shall mean gift and other
stores located within airports, excluding Duty-Free Store Operators (as
defined below) Examples of Airport Gift and Other Stores include,
without limitation, Paradies and ▇.▇. ▇▇▇▇▇.
2. "Amusement Game Redemption" shall mean distribution of products as
prizes awarded in amusement games.
3. "Amusement Park Gift Stores" shall mean gift stores located within
amusement parks, such as Six Flags, Paramount Parks, Universal Theme
Parks, Dollywood, ▇▇▇▇ Disney World and ▇▇▇▇ Disney Land.
4. "Art & Craft Stores" shall mean stores that offer for sale primarily
art and craft supplies. Examples of Art & Craft Stores include, without
limitation, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Fast Frame, Michaels and ▇▇▇▇▇▇▇▇ ▇▇
Designs.
5. "Athletic Apparel & Footwear Stores" shall means stores that offer for
sale primarily athletic apparel and footwear. Examples of Athletic
Apparel & Footwear Stores include, without limitation, Footlocker,
Athlete's Foot and Champs.
6. "Automotive/Carwash Stores" shall mean (a) stores that offer for sale
primarily automotive supplies, or (b) stores located at carwash or
gasoline station premises.
7. "Baby Specialty Stores" shall mean stores that offer for sale primarily
infant apparel, furniture, accessories and other products designed
specifically for babies. Examples of Baby Specialty Stores include,
without limitation, Babies R Us.
8. "Beauty Supply Stores" shall mean stores that offer for sale primarily
cosmetics, haircare products, beauty accessories and personal grooming
related items.
9. "Candy/Confectionery Specialty Stores" shall mean stores that offer for
sale primarily candy and confectionery products. Examples of
Candy/Confectionery Specialty Stores include, without limitation, FAO
Schweetz, and The Sweet Factory.
10. "Catalog Showrooms" shall mean stores that offer a broad assortment of
products for sale primarily through a catalog along with display of
samples of products in a showroom. Examples of Catalog Showrooms
include, without limitation, Service Merchandise.
11. "Chain Book Stores" shall mean chain stores (containing twenty (20) or
more individual stores) that offer for sale primarily books. Examples
of Chain Book Stores include, without limitation, ▇. ▇▇▇▇▇▇,
SuperCrown, ▇▇▇▇▇▇ Books, and Brentano's.
12. "Chain Comic Book Stores" shall mean chain stores (containing twenty
(20) or more individual stores) that offer for sale primarily comic
books.
13. "Chain Drug Stores" shall mean chain stores (containing twenty (20) or
more individual stores) that offer for sale primarily prescription and
over-the-counter drugs, personal care products and household products.
Examples of Chain Drug
20
Stores include, without limitation, Walgreens, Rite-Aide,
Thrifty/Payless, C.V.S./Revco, Thrift Drug, Phar Mor, and
Longs Drugs.
14. "Chain Jewelry Stores" shall mean chain stores (containing twenty (20)
or more individual stores) that offer for sale primarily jewelry. The
"Chain Jewelry Stores" channel shall specifically exclude Guild
Jewelers (as defined below). Examples of Chain Jewelry Stores include,
without limitation, Sterling, Barry's, ▇▇▇▇▇▇'▇ and Hellsburg.
15. "Chain Toy Stores" shall mean chain stores (containing twenty (20) or
more individual stores) that offer for sale primarily toys. In order to
be considered a "Toy Store" hereunder, the total number of toy-type
SKU's (stock-keeping units) must represent eighty percent (80%) or more
of such store's total SKU's. Examples of Chain Toy Stores include,
without limitation, Toys R Us.
16, "Coffee Specialty Stores" shall mean stores that offer for sale
primarily specialty coffee and related products, such as coffee mugs.
Examples of Coffee Specialty Stores include, without limitation,
Starbucks, Buzz Coffee, ▇▇▇▇▇▇ Jeans and The Coffee Beanery.
17. "College/University Stores" shall mean stores located on the campuses
of colleges or universities.
18. "Commercial Facilities" shall mean offering products for sale to
architectural firms or interior designers working with commercial
facilities, such as hotels and daycare facilities.
19. "Computer Specialty Stores" shall mean stores that offer for sale
primarily computer equipment and supplies. Examples of Computer
Specialty Stores include, without limitation, Comp USA.
20. "Convenience Stores" shall mean stores that offer for sale primarily
packaged and "quick service" food products, are generally open 24 hours
a day, and are designed to offer greater convenience than larger
Supermarket/Grocery Stores. Examples of Convenience Stores include,
without limitation, 7-11, AM/PM, Dairy Mart and Circle K.
21. "Dental/Medical Profession" shall mean institutions or, offices that
provide dental or medical services, such as hospitals, laboratories or
doctors' offices.
22. "Direct Mail Cataloqs" shall mean catalogs that offer products for sale
and are mailed directly to consumers' homes. The "Direct Mail Catalogs"
channel shall specifically exclude catalogs for fundraising purposes
which shall be included in the "Fundraising" channel defined below.
Examples of Direct Mail Catalogs include, without limitation, ▇▇▇▇▇▇▇,
Hearth & Home, Domestications, Tapestry, Company Store, Hammacher
Schlemmer, Fingerhut, Amway, and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇.
If Licensor grants to Licensee the right to distribute Licensed
Products through any Direct Mail Catalogs: (a) each such catalog shall
be specified in the Channels of Distribution set forth in the License
Agreement or otherwise expressly approved in writing by Licensor, and
(b) each such catalog depicting or referring to the Licensed Products
or the Licensed Property must be submitted to Licensor for prior
written approval in accordance with Licensor's Brand Assurance policies
and procedures.
23. "Door-to-Door Solicitation" shall mean offering products for sale
through personal visits by salespersons to consumers' homes.
24. "Duty-Free Operators" shall mean (a) stores usually located in transit
locations (i.e. airports, in-flight, train, ferry stations, cruise
lines and ports) which offer products for sale to international
travelers free of taxes and duties and
21
(b) sales offered to diplomat shops, diplomat suppliers and individual
diplomats free of taxes and/or duties. If Licensor grants to Licensee
the right to distribute products through Duty-Free Operators, such
channels of distribution (i.e. all other channels of distribution
granted) shall be limited to those stores located within the Territory.
25. "Educational Institutions" shall mean offering products (generally
books) for sale to public or private schools or other educational
institutions. Examples of Educational Institutions include, without
limitation, the Los Angeles Unified School District.
26. "Educational Specialty Stores" shall mean stores that offer for sale
primarily educational products. Examples of Educational Specialty
Stores include, without limitation, Imaginarium and Nature Company.
27. "Electronics Stores" shall mean stores that offer for sale primarily
electronic products. Examples of Electronics Stores include, without
limitation, Circuit City, Fry's, and Best Buy.
28. "Family Restaurants" shall mean a food service establishment or group
of food service establishments that offer a sit down meal menu
conducive to all members of the family and generally offers table
service to customers. Examples of Family Restaurants' include, without
limitation, Denny's and Friendly's.
29. "Fashion Accessory Stores" shall mean stores that offer for sale
primarily costume jewelry, hair accessories and other fashion
accessories. Examples of Fashion Accessory Stores include, without
limitation, Claire's Boutique, Afterthoughts, It's About Time and
Piercing Pagoda.
30. "Florists" shall mean stores or companies that offer for sale primarily
flowers. Examples of Florists include, without limitation, ▇▇▇▇▇▇'▇,
FTD, and 1-800-Flowers.
31. "Food Service" shall mean locations that provide food service to
consumers in cafeterias, hospital food services, school lunch programs,
and similar institutional food service locations.
32. "Fundraising" shall mean offering products for sale through catalogs,
direct mail brochures, prize programs and in-school sales, which are
used by schools and charitable, religious or other organizations to
raise funds. Examples of Fundraising companies include, without
limitation, Giftco, Springwater, and Darlington Farms.
33. "Garden Specialty Stores" shall mean stores that offer for sale
primarily garden supplies and plants. Examples of Garden Specialty
Stores include, without limitation, Armstrong's, Callaway's, and Wolf
Nurseries.
34. "Gift Retailers" shall mean stores that (a) offer products for sale
that are in somewhat related product categories and are known as
"gifts" in the trade, which products generally are classified in the
trade as "better" quality and are higher priced (as compared to
National and Regional Discount/Mass Retailers' products), (b) do not
usually discount merchandise or sell it at greatly reduced prices, (c)
usually focus more on aesthetics in merchandise displays than on price,
and (d) generally require individual store servicing by suppliers in
merchandise set-up, display, SKU maintenance and reordering. Suppliers
to gift retailers typically advertise in trade publications, such as
"Gift & Stationery Business" "Giftware News" and "Gifts & Decorative
Accessories". Suppliers to Gift Retailers usually include companies
such as Enesco, Midwest of ▇▇▇▇▇▇ Falls, New Creative Enterprises, ▇▇▇▇
▇▇▇▇▇▇▇, Pacific Rim, ▇▇▇▇ ▇▇▇▇▇▇, Waterford, GiftCraft, ▇▇▇▇▇▇
Industries, Possible Dreams, Lenox, Department 56, Lefton, Swarovski
and Flambro. The "Gift Retailers" channel shall specifically exclude
Novelty,
22
Gift Stores (as defined below), Duty-Free Store Operators (as defined
above), and Airport Gift and Other Airport Stores (as defined above)
35. "Gourmet Food Specialty Stores" shall mean stores that offer for sale
primarily gourmet and specialty food products. Examples of Gourmet Food
Specialty Stores include, without limitation, Bristol Farms, Whole
Foods and Gelsons.
36. "Greeting Card Stores" shall mean stores that offer for sale primarily
greeting cards. Examples of Greeting Card Stores include, without
limitation, Hallmark.
37. "Guild Jewelers" shall mean stores that offer for sale primarily fine
jewelry which is generally classified in the trade as "best" or
"highest" quality. Examples of Guild Jewelers include, without
limitation, Mayers, Rogers, and Baily Banks & ▇▇▇▇▇▇.
38. "Hobby & Model Stores" shall mean stores that offer for sale primarily
hobby and model supplies.
39. "Home Improvement Stores" shall mean stores that offer for sale
primarily hardware and home improvement supplies. Examples of Home
Improvement Stores include, without limitation, Home Depot, OSH, Home
Base, and Lowes.
40. "Home Specialty Stores" shall mean stores that offer for sale primarily
bedding, towels and other bathroom products, kitchen merchandise and
housewares. Examples of Home Specialty Stores include, without
limitation, Strouds, Linens 'N' Things, 3D Bed & Bath, Bed/Bath/Beyond,
and Luxury Linens.
41. "Ice Cream Shops" shall mean stores that offer for sale primarily ice
cream, ice cream cakes and similar frozen dessert products. Examples of
Ice Cream Shops include, without limitation, ▇▇▇▇▇▇-▇▇▇▇▇▇▇, Dairy
Queen and Ben and Jerry's Shops.
42. "In-Store Bakeries" shall mean the in-store bakery departments within
Supermarket/Grocery Stores, National and Regional Discount/Mass
Retailers and Warehouse Clubs. Such departments offer for sale
primarily freshly baked breads, cakes, cookies and similar bakery
items.
43. "Internet" shall mean offering products for sale through the electronic
network known as the Internet.
44. "Mail Clothing Specialty Stores" shall mean stores that offer for sale
primarily clothing and are located within a mall. Examples of Mall
Clothing Specialty Stores include, without limitation, Millers Outpost
and Wet Seal.
45. "Mid-Tier Department Stores" shall mean stores that offer products for
sale in a broad assortment of unrelated product categories, which
products are generally classified in the trade as "better" (but not
"best") quality products. Examples of Mid-Tier Department Stores
include, without limitation, JC Penney, Sears, Mervyn's, SteinMart,
▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇▇ Wards.
46. "Military Exchange Services" shall mean military headquarters as well
as individual bases of armies and/or airforces of each country within
the Territory. Examples of Military Exchange Services include, without
limitation, U.S. Army and Airforce Exchange Service ("AAFES") and the
Canadian Forces Exchange Service ("CANEX").If Licensor grants to
Licensee the right to distribute products through Military Exchange
Services, such channel of distribution (like all other channels of
distribution granted) shall be limited to those stores located within
the Territory.
47. "Music/Video Stores" shall mean stores that offer for sale primarily
musical recordings, on compact discs, cassettes or other media, and/or
movie recordings on videos, laser disks
23
or other media for home use by consumers. Examples of Music/Video
Stores include, without limitation, Blockbuster, Musicland, Tower
Records, Virgin Records, Warehouse Records, ▇▇▇ ▇▇▇▇▇'▇, and Suncoast.
48. "National Discount/Mass Retailers" shall mean stores that (a) have
nation-wide distribution, (b) offer products for sale in a broad
assortment of unrelated product categories, which products generally
are not classified in the trade as "better/best" quality products, (c)
are usually "self-service" with more of an emphasis on price than
aesthetics, and (d) generally do not require individual store servicing
by suppliers. Suppliers to National Discount/Mass Retailers typically
advertise in trade publications, such as "Discount Store News" and
"Discount Merchandiser", and usually attend the IMRA (International
Mass Retailer Association) trade show. The "National Discount/Mass
Retailers" channel shall specifically exclude the in-store bakery
departments of such stores, which shall be included in the "In-Store
Bakeries" channel defined above. Examples of National Discount/Mass
Retailers include, without limitation, Walmart, K-Mart, Target and
Zellers.
49. "Non-Chain Book Stores" shall mean stores or groups of stores
(containing fewer than twenty (20) individual stores) that offer for
sale primarily books.
50. "Non-Chain Comic Book Stores" shall mean stores or groups of stores
(containing fewer than twenty (20) individual stores) that offer for
sale primarily comic books.
51. "Non-Chain Drug Stores" shall mean stores or groups of stores
(containing fewer than twenty (20) individual stores) that offer for
sale primarily prescription and over-the-counter drugs, personal care
products and household products.
52. "Non-Chain Jewelry Stores" shall mean stores or groups of stores
(containing fewer than twenty (20) individual stores) that offer for
sale primarily jewelry. The "Non-Chain Jewelry Stores" channel shall
specifically exclude Guild Jewelers (as defined above).
53. "Non-Chain Toy Stores" shall mean stores or groups of stores
(containing fewer than twenty (20) individual stores) that offer for
sale primarily toys. In order to be considered a "Toy Store" hereunder,
the total number of toy-type SKU's must represent eighty percent (80%)
or more of such store's total SKU's. Examples of Non-Chain Toy Stores
include, without limitation, Talbot's Toyland and Tons of Toys, Inc.
54. "Non-Mall Clothing Specialty Stores" shall mean stores that offer for
sale primarily clothing and are not located within a mall. Examples of
Non-Mall Clothing Specialty Stores include, without limitation, Kids
Mart, Kids R Us, Clothestime and Fashion Bug.
55. "Novelty Gift Stores" shall mean stores that offer for sale primarily
novelty gift items. The "Novelty Gift Stores" channel shall
specifically exclude Airport Gift and Other Airport Stores and Duty-
Free Operators (as such terms are defined above). Examples of Novelty
Gift Stores include, without limitation, Spencer's.
56. "Off-Price/Closeout Stores" shall mean stores that offer for sale
primarily discounted apparel and other merchandise. Examples of Off-
Price/Closeout Stores include, without limitation, ▇▇▇▇▇▇▇▇'▇, ▇.▇.
Maxx, ▇▇▇▇ for Less, Hit or Miss and Tuesday Morning.
57. "Office Specialty Stores" shall mean stores that offer for sale
primarily office supplies. Examples of Office Specialty Stores include,
without limitation, Office Depot, Staples, and Office Max.
58. "Outlet Stores" shall mean stores that offer for sale primarily
discounted merchandise of a particular manufacturer
24
or retailer.
59. "Party Stores" shall mean stores that offer for sale primarily party
supplies. Examples of Party Stores include, without limitation, Party
City and Party World.
60. "Pet Stores" shall mean stores that offer for sale primarily pet
supplies. Examples of Pet Stores include, without limitation, PetCo and
PetSmart.
61. "Quick Service Restaurants" shall mean a food service establishment or
group of food service establishments that offer rapid meal menus to
consumers and generally do not offer table service to customers.
Examples of Quick Service Restaurants include, without limitation,
Subway and Burger King.
62. "Regional Discount/Mass Retailers" shall mean stores that (a) have
regional distribution, (b) generally offer products for sale in a broad
assortment of unrelated product categories, which products generally
are not classified in the trade as "better/best" quality products, (c)
are usually "self-service" with more of an emphasis on price than
aesthetics, and (d) generally do not require individual store servicing
by suppliers. Suppliers to Regional Discount/Mass Retailers typically
advertise in trade publications, such as "Discount Store News" and
"Discount Merchandiser", and usually attend the IMRA (International
Mass Retailer Association) trade show. The "Regional Discount/Mass
Retailers" channel shall specifically exclude the in-store bakery
departments of such stores, which shall be included in the "In-Store
Bakeries" channel defined above. Examples of Regional Discount/Mass
Retailers include, without limitation, Meijers, Caldor, ▇▇▇▇, Bradlees,
Hill's, Rose's, Venture, and Shopko.
63. "Retail Bakeries" shall mean stores that offer for sale primarily
freshly baked breads, cakes, cookies and similar bakery items. The
"Retail Bakeries" channel shall specifically exclude In-Store Bakeries
(as defined above).
64. "School Book Clubs/Fairs" shall mean offering products for sale through
book catalogs distributed to teachers and students at public or private
schools (usually elementary or high school) or through book fairs
conducted on the premises of such schools. Examples of School Book
Clubs/Fairs include, without limitation, Troll Book Club and Scholastic
Book Fair.
65. "Souvenir Stores" shall mean stores that offer for sale primarily
souvenirs.
66. "Sporting Good Stores" shall mean stores that offer for sale primarily
sporting goods, equipment, athletic apparel, and other merchandise that
reflects a sports theme. Examples of Sporting Good Stores include,
without limitation, Big 5 and Sports Chalet.
67. "Sports Stadium Shops" shall mean concessionaire shops located within
stadiums or arenas where sporting events are held.
68. "Stationery Stores" shall mean stores that offer for sale primarily
stationery. Examples of Stationery Stores include, without limitation,
▇▇▇▇'▇ Stationaires.
69. "Street Peddlers" shall mean individual merchants who offer products
for sale in stands, booths or other non-permanent structures usually
located on the sidewalk and designed to attract passing pedestrians.
70. "Supermarket/Grocery Stores" shall mean stores that offer for sale
primarily packaged food products. The "Supermarket/ Grocery Stores"
channel shall specifically exclude the in-store bakery departments of
such stores, which shall be included in the "In-Store Bakeries" channel
defined above. The "Supermarket/Grocery Stores" channel shall
specifically
25
exclude Gourmet Food Specialty Stores (as defined above)
and Convenience Stores (as defined above). Examples of
Supermarket/Grocery Stores include, without limitation, Kroger,
Safeway, American Stores, Albertson's, ▇▇▇▇ ▇▇▇▇▇, Food Lion, Von's,
Finast, Ralphs and ▇▇▇▇▇.
71. "Swap Meets/Flea Markets" shall mean offering products for sale through
organized events known as swap meets or flea markets, which involve a
group of vendors offering for sale a variety of products, often
collectibles or antiques.
72. "Television Home Shopping" shall mean offering products for sale
through cable and broadcast television, including infomercials, QVC and
Home Shopping Network. The "Television Home Shopping" channel shall
specifically exclude sales through the Internet, CD-Interactive and
other electronic media.
73. "Toy Wholesalers" shall mean companies that offer for sale primarily
toys to retail stores. In order to be considered a "Toy Wholesaler"
hereunder, the total number of toy-type SKU's must represent eighty
percent (80%) or more of such wholesaler's total SKU's.
74. "Trackside-CART" shall mean offering products for sale at races
organized and sponsored by Championship Auto Racing Teams.
75. "Trackside-NASCAR" shall mean offering products for sale at races
organized and sponsored by the National Association for Stock Car
Racing.
76. "Trackside-NHRA" shall mean offering products for sale at races
organized and sponsored by the National Hot Rod Association.
77. "Upstairs Department Stores" shall mean stores that (a) offer products
for sale in a broad assortment of unrelated product categories, which
products are generally classified in the trade as "best" quality
products, and (b) offer a high level of customer service with a strong
emphasis on store aesthetics. Examples of Upstairs Department Stores
include, without limitation, Bloomingdale's, Macy's, Nordstrom's, May
Department Stores, Saks Fifth Avenue, Neiman Marcus, and Dillards.
78. "Vending Machines" shall mean self-contained automated dispensing
equipment operated by insertion of coin or paper currency or the
equivalent thereof (i.e. debit cards, credit cards, etc.)
79. "Warehouse Clubs" shall mean stores that offer for sale products in
large sizes and quantities with more of an emphasis on price than
service or store aesthetics. The "Warehouse Clubs" channel shall
specifically exclude the in-store bakery departments of such stores,
which shall be included in the "In-Store Bakeries" channel defined
above. Examples of Warehouse Clubs include, without limitation, Sam's
Club and Price Costco.
80. "WBSS" shall mean the retail stores known as Warner Bros. Studio
Stores, which are operated by or on behalf of Licensor, its affiliated
companies or its franchisees, including the Warner Bros. Studio Store
catalogs.
26
EXHIBIT 2 #12053-WBLT
CONTRIBUTOR'S AGREEMENT
-----------------------
I, ______________________, the undersigned ("Contributor"), have been
engaged by BRAVO! FOODS, INC. ("Licensee") to work on or contribute to the
creation of Licensed Products, described as ___________________, by
Licensee under an agreement between Licensee and Warner Bros., a division
of Time Warner Entertainment Company L.P., c/o Warner Bros. Consumer
Products, a division of Time Warner Entertainment Company L.P. {"Warner"}
dated ________________.
I understand and agree that the Licensed Products, and all artwork or other
results of my services for Licensee in connection with such Licensed
Products {"Work"} is a "work made for hire" for Warner and that all right,
title and interest in and to the Work shall vest and remain with Warner. I
reserve no rights therein. Without limiting the foregoing, I hereby assign
and transfer to Warner all other rights whatsoever, in perpetuity
throughout the universe which I may have or which may arise in me or in
connection with the Work. I hereby waive all moral rights in connection
with such Work together with any other rights which are not capable of
assignment. I further agree to execute any further documentation relating
to such transfer or waiver or relating to such Work at the request of
Warner or Licensee, failing which Warner is authorized to execute same as
my Attorney-in-Fact.
Contributor:
By:
signature
print name
address
country
date
Warner Bros. Consumer Products:
By: ______________________________
Date: ____________________________
27
EXHIBIT 3 #12053-WBLT
WARNER BROS. CONSUMER PRODUCTS
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇-▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Approval of Third Party Contracts Gentlemen:
This letter will serve as notice to you that pursuant to Paragraph
10(b) of the License Agreement dated _______________, 2000 between WARNER
BROS., A DIVISION OF TIME WARNER ENTERTAINMENT COMPANY L.P. and BRAVO!
FOODS, INC. ("Licensee") , we have been engaged by Licensee in connection
with the promotion, manufacture, distribution and sale of the Licensed
Products as defined in the aforesaid License Agreement. We hereby
acknowledge that we may not promote, manufacture, distribute or sell the
Licensed Products, except as provide for herein and in the aforesaid
License Agreement. We hereby further acknowledge that we have received a
copy and are cognizant of the terms and conditions set forth in said
License Agreement and hereby agree to observe those provisions of said
License Agreement which are applicable to our function as promoter or
manufacturer, distributor and seller of the Licensed Products. It is
expressly understood that we are obligated to comply with all local laws,
including without limitation, labor laws, wage and hour laws and anti-
discrimination laws and that you or your representatives shall, at anytime,
have the right to inspect our facilities and review our records to ensure
compliance therewith. It is understood that this engagement is on a royalty
free basis and that we may not subcontract any of our work without your
prior written approval.
We understand that our engagement as the promoter or manufacturer,
distributor and seller for Licensee is subject to your written approval. We
request, therefore, that you sign in the space below, thereby showing your
acceptance of our engagement as aforesaid.
Very truly yours,
manufacturer/company name
By:
signature
print name
address
country
date
product(s) manufacturing
AGREED TO AND ACCEPTED:
WARNER BROS. CONSUMER PRODUCTS, a Division of Time Warner
Entertainment Company L.P.
By:
▇▇▇▇ ▇. ▇▇▇▇▇
Vice President & General Counsel
Date:
28