LICENSING AGREEMENT
AGREEMENT dated this 25th day of August 1995 between The Curtis Publishing
Company, Licensing Division (hereinafter referred to as "Licensor"), located
1000 Waterway Boulevard, Indianapolis, IN 46202, and Artisan House, Inc.
(hereinafter referred to as "Licensee"), located at 1755 Glendale Blvd., Los
Angeles, California 90026.
WITNESSETH:
WHEREAS, Licensor was engaged in publishing the magazine The Saturday Evening
Post;
WHEREAS, Licensor is the owner of a library of distinctive and well-known
copyrighted magazine illustrations produced for The Saturday Evening Post
Company;
WHEREAS, Licensee desires to utilize certain of said illustrations for its
merchandise upon the terms and conditions set forth below.
NOW THEREFORE, in consideration of the mutual promises and undertakings herein
contained and for other good and valuable considerations, intending to be
legally bound, the parties agree as follows:
1. DEFINITION OF TERMS
(a) "Consumer Sales" shall mean sales of Goods by Licensee directly or
through its authorized wholesalers, representatives or distributors to
retail establishments for eventual resale to the consumer.
(b) "Mail Order Sales" shall mean sales of Goods by Licensee directly to
the consumer through direct mail solicitation or catalogues or
electronic or TV mail order.
(c) "Original Term" shall mean the period beginning on October 1, 1995 and
ending on September 30, 1997.
(d) "Contract Year" shall mean the period commencing on January 1st and
ending on December 31st of the same year.
(e) A "Premium" shall mean any article used for the purpose of increasing
the sale of another item, promoting or publicizing any product or
service, or used to motivate a sales force, merchant, consumer, or any
other person to perform a specific act.
(f) "Net Wholesale Selling Price" as used herein shall be defined as
meaning the price at which the Goods are sold to Licensee's customers
net of all returns actually made or allowed.
2. GRANT OF LICENSE
Subject to the limitations set forth in Paragraph 2(d) below, and the other
conditions of this Agreement, for the original term of this contract the
Licensor hereby grants to Licensee the rights to use the illustrations listed
under Schedule A below, (hereinafter referred to as "the Materials") on the
following merchandise (hereinafter referred to as "Goods"):
(a) Description of Goods: Metal Wall Sculptures painted and
unpainted.
(b) Schedule A: Use of up to 10 Norman Rockwell/
Saturday Evening Post cover
illustrations.
(To be selected - See Schedule A.)
(c) Market and Territory: Licensee shall only make sales of Goods as
described in Paragraph 1 (a) and (b) above. The license hereby granted
extends worldwide.
(d) Limitations on License: No license is granted hereunder for the use of
Material for any purpose other than upon or in connection with the
Goods. No license is granted hereunder for the manufacture, sale or
distribution of Goods to be used as premiums, for publicity purposes,
in combination sales, as giveaways, or to be disposed of under similar
methods of merchandising. In the event Licensee desires to sell Goods
for such purposes, Licensee acknowledges and agrees that it must first
seek and obtain a separate license therefore from Licensor and that
the user thereof must also obtain a separate license from Licensor for
such use of the Goods.
(e) Exclusivity: For the Original Term of this Agreement, Licensor shall
not license any other person to use, in the Territory, the Materials
listed under Schedule A on the Goods listed in Paragraph 2(a) above.
3. ROYALTIES
(a) Advance against Royalties: Simultaneous with the signing of this
Agreement, the Licensee shall pay to the Licensor a payment in the
amount of five thousand dollars ($5,000) as a non-refundable advance
against royalties earned.
(b) Rate: In consideration of this license, the Licensee shall pay to the
Licensor, during the Original Term of this Agreement and any extension
thereof, a royalty in the amount of eight percent [8%] of the Net
Wholesale Selling Price of Goods sold or four percent (4%) for Direct
Mail/Retail of Goods sold. In computing Net Wholesale
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Selling Price, no costs incurred in other advertising and promoting
allowances, or distributing the Goods or any indirect expenses shall
be deducted.
4. ACCOUNTING
Not later than the thirtieth (30th) day after every quarter during the Original
Term and any extension thereof, and thereafter so long as any sales are made by
the Licensee pursuant to this Agreement, the Licensee shall furnish to the
Licensor a full, complete and accurate statement showing the number of Goods,
which have been sold by the Licensee and the selling price thereof during the
preceding quarter. For the purposes of this Agreement, an item is considered to
be sold when it is ordered and invoiced or shipped, whichever is sooner.
5. PAYMENT
Simultaneous with the rendition of the statement as aforesaid in Paragraph 4
above, the Licensee shall pay to the Licensor, subject to the provisions of
Paragraph 3, such royalties as the statement indicated are due the Licensor.
6. DURATION
Except as otherwise provided in the following paragraphs, upon completion of the
Original Term, all rights granted the Licensee shall automatically terminate.
7. QUALITY
Licensee acknowledges that if the Goods manufactured and sold by it are of
inferior quality in material and workmanship, the substantial good will which
the Licensor has built up and now possesses in the Material will be impaired.
Accordingly, Licensee warrants that the Goods will be of high standard and of
such appearance and quality as shall be reasonably adequate and suited to their
exploitation to best advantage. Licensee shall submit to Licensor finished art
work and/or a facsimile of all Goods to be manufactured, together with its
cartons and containers, including packaging and wrapping material, which shall
be approved in writing by the Licensor before the Goods are advertised,
distributed or sold. Any article submitted and not disapproved within fourteen
(14) days of the receipt of same by Licensor shall be deemed to have been
approved. After samples of the Goods have been approved pursuant to this
paragraph, Licensee shall not depart therefrom without written consent of the
Licensor. In the event there is a departure from the approved sample of the
Goods made or distributed by Licensee, or in the event there is an occurrence
connected with any such Goods or Licensee which reflects unfavorably upon
Licensor, the Licensor shall have the right in the reasonable exercise of its
sole discretion to withdraw its approval of such Goods, at which time this
Agreement shall automatically terminate with respect to such Goods.
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8. SAMPLES
Licensee shall supply Licensor with 1 sample of each of the completed Goods.
9. BOOKS AND RECORDS
The Licensee shall keep full, complete and accurate books of account and records
covering all transactions relating to the subject matter of this Agreement.
Licensor, through its authorized representative shall have the right to examine
such books of account and records and other documents and material in Licensee's
possession or under its control insofar as they relate to the manufacture and
sale of Goods. The Licensor shall have free and full access therefrom at any
reasonable hour of the day during which the Licensee's offices are open and in
any reasonable manner. Licensee need only retain such books of account and
records for a two-year period following the termination of this Agreement.
10. GOODWILL
The Licensee acknowledges that the Material is unique and original and that the
Licensor is the owner thereof. The Licensee shall not, during the Original Term
of this Agreement or any time thereafter, dispute or contest, directly or
indirectly; the Licensor's ownership of the Material; The Licensor's exclusive
right (subject to this license) to use the Material; the validity of any of the
copyrights or trademarks pertaining thereto or the Licensor's ownership thereof.
Nor shall the Licensee assist or aid others in doing so. At the Licensor's
request, the Licensee shall cooperate with the Licensor in preventing or
stopping any infringement or unfair use by any third party of the Goods or the
Material. The Licensor shall bear the costs of preventing or stopping any such
infringement or unfair use, which it elects to pursue, and the Licensee's
obligation will be limited to providing fill cooperation to Licensor.
11. LICENSEE'S EFFORTS
Licensee agrees that it will exercise its best efforts to manufacture,
distribute and sell the Goods within the territory. It is also agreed that
Licensee will use its best efforts to fulfill orders for Goods in a timely and
reasonable manner. Should there be an unforeseen delay in fulfilling customers'
orders for Goods, Licensee will exercise all possible diligence in informing
those customers of the delay, and complying totally with Federal Trade
Commission regulations and all other relevant state and federal laws. In the
event of an unforeseen delay in fulfilling orders to customers, Licensee also
agrees that it will refrain from advertising or promoting Goods, or soliciting
orders from consumers until such problems are cured.
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12. COPYRIGHT, ETC.
(a) The Licensor shall apply to register trademarks and claims to
copyright, and apply for design patents on the Goods and/or the
Material as may be reasonably necessary, in the Licensor's sole
discretion, to protect the Licensor's interests.
All applications for registration of claims to copyright shall
identify the Licensor as the copyright proprietor; all applications to
register trademarks shall identify the Licensor as the trademark
owner; and all applications for design patents shall correctly
identify the inventor and shall be assigned to the Licensor.
(b) If the Licensor requires any specimens of the Goods, or any
photographic reproductions of the same, for use in filing copyright,
trademark or patent applications, the Licensee shall provide the
Licensor with the same at Licensee's expense.
(c) At the Licensor's request, the Licensee shall execute assignments in
favor of the Licensor of any and all copyrights, trademarks or other
property rights of whatever kind relating to the Goods and/or the
Material without further consideration.
(d) Licensee shall ensure and warrant that it will provide a legally
sufficient copyright notice on the Goods and/or the packaging,
wrapping, advertising and promotional material bearing any
reproductions of the Goods or the Material, in the following format
designated by Licensor:
(C) 19** The Curtis Publishing Company
or such other format as Licensor shall from time to time direct. The
Licensee further warrants that it will take such precautions as are
necessary to insure that any reproductions made by its customers also
bear the Licensor's legal copyright notice.
13. ADVERTISING/STYLE GUIDELINES
All advertisements and promotional materials which Licensee intends to use to
promote Goods shall be submitted to Licensor for its written approval prior to
publication. Licensor shall have fourteen (14) days from the date of receipt of
said material in which to approve or disapprove it. Such approval shall not be
unreasonably withheld by Licensor.
To the fullest extend possible, the style guidelines of the Licensor will be
followed in advertising, labeling and promotion.
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14. RIGHT OF TERMINATION
Without prejudice to any other rights, Licensor shall have the right to
terminate this Agreement upon written notice to Licensee, sent by certified
mail, return receipt requested, at any time that any of the following may occur:
(a) If Licensee shall not have begun the bona fide manufacture or
production of the Goods licensed hereunder within ninety (90) days
from the commencement of the term hereof.
(b) If Licensee shall be unable to fulfill or obtain valid purchase orders
for the Goods throughout the territory hereof for any reason for a
period of six (6) months or more.
(c) If Licensee shall fail to make any payment due hereunder or to deliver
any of the statements herein referred to, and if such default shall
continue for a period of sixty (60) days.
(d) If Licensee shall be unable to pay its liabilities when due, or shall
make any assignment for the benefit of creditors, or shall file any
petition under Chapter 10, 11 or 12 of Title 11, United States Code,
or file a voluntary petition in bankruptcy or be adjudicated as
bankrupt or insolvent, or if any receiver is appointed for its
business or property, or if any trustee in United States government or
of the several states, Licensor shall have the right to terminate this
Agreement. Notwithstanding the foregoing, the Licensor shall, at any
time during the term of this contract, have the option of demanding an
assurance from Licensee of Licensee's ongoing ability to perform the
provisions of this contract, if, in the reasonable opinion of
Licensor, Licensee is unable to adequately fulfill its requirements.
If reasonable and adequate assurance is not received by Licensor
regarding Licensee's ability to perform, Licensor shall have the right
to terminate this Agreement.
15. SALES AFTER EXPIRATION
Should this Agreement terminate for any reason or expire, Licensee may, at the
sole discretion of the Licensor, be permitted to sell its remaining inventory of
Goods for a period not to exceed one hundred and twenty (120) days following the
termination or expiration of this Agreement. Said request to sell remaining
inventory shall be sent to the Licensor within thirty (30) days before
expiration or from Licensee's receipt of any notice terminating the license
herein. However, the Licensee shall not, without prior written consent of the
Licensor, sell any such remaining Goods as distress merchandise or otherwise
than in the ordinary course of business. For the purpose of this Agreement, a
distress sale shall be defined as one in which the merchandise is sold for less
than fifty percent (50%) of the normal wholesale selling price. Licensee shall
pay royalties on all such sales in the manner provided for in this Agreement.
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16. CESSATION OF USE
Except as otherwise provided in Paragraph 15, the Licensee shall, forthwith upon
the expiration of this Agreement or any extension thereof, or upon its sooner
termination, discontinue the manufacturing, printing, promotion, advertising,
sale and distribution of Goods.
17. RIGHTS RESERVED BY LICENSOR
Any and all rights in and to said Material which are not expressly granted to
the Licensee are hereby reserved by the Licensor. Any one or more of such
reserved rights may be exercised or enjoyed by the Licensor, directly or
indirectly, at any and all times.
18. REIMBURSEMENT OF EXPENSES
Licensee agrees to reimburse Licensor for all labor, material and other expenses
incurred by Licensor at the direct request of Licensee.
Licensee further agrees to reimburse Licensor for the cost of any royalties
audit deemed necessary and proper by Licensor, provided such audit finds a
discrepancy of five percent (5%) or more.
19. LICENSOR'S CLAIM
Whatever claim Licensor may have against Licensee hereunder for royalties and/or
for damages shall become a first lien upon all of said Goods manufactured or
produced pursuant to the terms of this Agreement in the possession or under the
control of Licensee or its agents upon the expiration or termination of this
Agreement.
20. REMEDIES
All specific remedies provided for in this Agreement shall be cumulative and
shall not be exclusive of one another or of any other remedies available in law
or equity. The failure of the Licensor to insist upon the strict performance of
any of the covenants or terms hereof to be performed by the Licensee shall not
be construed as a waiver of such covenants or terms.
21. LICENSEE'S WARRANTY
Licensee hereby agrees to be solely responsible for, to defend and indemnify
Licensor and its respective officers, agents and employees, and to hold each of
them harmless from any claims, demand, causes of action or damages, including
reasonable attorney's fees arising out of the distribution or use of the Goods,
other that those based solely on Licensee's use of the Material authorized by
this Agreement. Licensee will obtain and maintain product liability insurance in
the minimum amount of five hundred thousand dollars
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providing protection for Licensor and its respective officers, agents and
employees against any attorney's fees arising out of any alleged defects in
Goods or any use thereof, in an amount and providing coverage satisfactory to
Licensor. Such insurance policy shall provide that it may not be canceled
without at least ten days written notice by Licensor. Further, Licensor will
furnished with a certificate of such insurance issued by the insuring company.
22. LICENSOR'S WARRANTY
Licensor represents and warrants to Licensee that it is the sole owner and
proprietor of Material and has the power to enter into this Agreement. Licensor
hereby agrees to indemnify Licensee, its officers, agents and employees and to
hold them harmless against claims, demands, causes of action or damages, for
trademark or copyright infringement arising out of the use of the Material as
authorized by this Agreement, provided that Licensor is given immediate notice
of and shall have the option to undertake and conduct the defense of any such
claim, demand or cause of action. Licensee may, but shall not be obligated to,
join in such defense and be represented by its own counsel. All liabilities,
expenses, losses, damages and reasonable attorney's fees in connection with any
such claim shall be paid by Licensor, except that if Licensee elects to be
represented by its own counsel, Licensee will pay its own attorney's fees.
Licensee agrees that while it may counsel Licensor concerning the disposition of
any such action, Licensor shall have the sole final decision concerning the
disposition of any action and the right to dispose of inventory and works in
progress as it sees fit.
23. NO PARTNERSHIP OR JOINT VENTURE
This Agreement does not constitute and shall not be construed as constituting a
partnership or joint venture between Licensor and Licensee. The Licensee shall
have no right to obligate or bind Licensor in any manner whatsoever and nothing
herein contained shall give or is intended to give any rights of any kind to any
third party.
24. NO ASSIGNMENT
The license hereby granted is and shall be personal to the Licensee and shall
not be assignable by any action of the Licensee or by operation of the law, and
any attempt at such assignment shall be null and void. The Licensee shall have
no right to grant any sub-licenses. Material change in ownership or corporate
firm of the Licensee shall render this Agreement null and void. This Agreement
shall inure to the benefit of and shall be binding upon the Licensor's
successors and assigns.
25. WAIVER AND MODIFICATION
No waiver or modification of any of the terms of this Agreement shall be valid
unless in writing and signed by the party against whom such modification or
waiver is sought to be enforced. No waiver by either party of a breach hereof
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of a default hereunder shall be deemed a waiver by such party of a subsequent
breach or default of like or similar nature.
26. NOTICE
Whenever notice is required to be given under this Agreement, it shall be deemed
to be good and sufficient notice if in writing, signed by an officer or an
authorized agent of the party serving such notice and sent by telegram, telex or
mailed by registered or certified mail, return receipt requested, to the other
party at the address stated above unless notification of a change of address is
given in writing.
27. CONSTRUCTION
This Agreement has been executed in the State of Indiana and shall be construed
in accordance with the laws of said State, irrespective of the forum in which
the Agreement or any part of it may come up for construction, interpretation, or
enforcement.
28. ENTIRE AGREEMENT
This Agreement contains the entire understanding of the parties. There are no
representations, warranties, promises, covenants or understandings other than
those herein contained.
IN WITNESS WHEREOF, the parties hereto have caused these presents to be signed
by their duly authorized officers as of the day and year first above written.
THE CURTIS PUBLISHING ARTISAN HOUSE, INC.
COMPANY
LICENSING DIVISION
BY: [Illegible] BY:__________________________
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TITLE: President TITLE:_______________________
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DATE: Aug 28, 1993 DATE:________________________
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SCHEDULE A
ARTISAN HOUSE, INC.
DATE ILLUSTRATION
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04/24/26 Sunset Norman Rockwell
(Additional 9 images to be selected)
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