Exhibit 10.14
ORIGINAL
TRADEMARK LICENSE AGREEMENT
THIS AGREEMENT is made this 18th day of March, 2003 by and between YAMAHA
MOTOR CORPORATION, U.S.A., a California corporation, whose principal place of
business is located at 6555 Katella Avenue, Cypress, California 90630
(hereinafter referred to as "YMUS") and YAMAHA MOTOR COMPANY, LTD., 2500
Shingai, Iwata, Shizuoka 4388501, Japan (hereinafter referred to as "YMC") (YMUS
and YMC may be collectively referred to as "YAMAHA") and Padova International
U.S.A. (d.b.a. Execute Sports) a Nevada corporation whose principal place of
business is located at 23121 Arroyo Vista Ste. B, Rancho Santa Margarita,
California 92688 (hereinafter referred to as "Licensee").
RECITALS
WHEREAS, YMC owns or is authorized to grant, for the purposes of this
Agreement, the rights in and to the trademark described in Schedule A, attached
hereto, as well as, names, titles, symbols, designs, copyrights, trademarks,
artwork, and elements embodied in or derived from the property (hereinafter
collectively referred to as the "Property"); and
WHEREAS, Licensee desires to obtain from YMC the right to use the Property
on and in connection with the manufacture, sales, distribution and promotion of
the articles described below, and YMC is willing to grant such right based upon
the terms and conditions set forth below;
WHEREAS, YMUS is a wholly-owned subsidiary of YMC and YMC desires that
YMUS manage and maintain the Trademark License Agreement with those Licensee's
that will market the Licensed Product in North America.
WHEREAS, YMUS desires to manage and maintain the North America Trademark
License Agreements for YMC.
NOW, THEREFORE, in consideration of the mutual promises and undertaking
herein contained, it is hereby agreed:
1) GRANTS OF LICENSE
(a) Grant: YMC hereby grants to Licensee a non-exclusive, non-transferable
license, for the term of this Agreement and subject to its terms and conditions,
the non-exclusive right, license and privilege to use the Property in the manner
described herein in association with the Articles listed in Schedule B, attached
hereto except as provided in Paragraph's 14 hereof.
(b) Articles: For purposes of this Agreement, Articles shall be those
products listed in Schedule B attached hereto which bear the Property.
(c) Territory: The license hereby granted extends only to the Territory
described in Schedule C, attached hereto.
(d) Term: Unless sooner terminated in accordance with the provisions
hereof, the initial term of the license hereby granted and the renewal terms, if
any are to be provided hereunder, shall extend for the periods set forth in
Schedule D, attached hereto.
(e) Net Sales: Shall mean all gross sales of all Licensee's Articles, no
deduction shall be made for cash or other discounts or uncollectible accounts.
(f) Sold: Shall mean when Articles are billed out, delivered or shipped by
or on behalf of Licensee, whichever shall first occur.
(g) Affiliates: An entity shall be related to or affiliated with a party
hereto if one of them is a subsidiary of the other or both are subsidiaries of
the same body corporate or each of them is controlled by the same person. If two
bodies corporate are affiliated with the same body corporate at the same time,
they shall be deemed to be affiliated with or related to each other.
2. TERMS OF PAYMENT
(a) Rate: Licensee agrees to pay to YMC as its royalty a sum equal to the
percentage set forth in Schedule E, attached hereto, of all Net Sales by
Licensee or its Affiliates. No costs incurred in the manufacture, sale,
distribution or promotion of the Articles or in the payment by Licensee of taxes
of any nature shall be deducted from any royalty payable by Licensee.
(b) Minimum Royalties: Licensee agrees to pay to YMC a minimum royalty
consisting of an advance payment to be applied against a minimum guarantee
against which royalty payments shall be credited for each annual period in the
initial term hereof and in any renewal term hereunder, in the amounts and in the
manner specified in Schedule F, attached hereto. All royalty payments, advance
payments and minimum guarantee payments shall be made payable to YMC and sent to
YMC with a copy to YMUS, in accordance with Paragraph 19, Schedule J. No part of
any such minimum royalty shall in any event be repayable to Licensee. Royalty
payments which exceed any annual period's minimum royalty guarantee in the
initial term or any renewal term(s) shall not be credited toward the minimum
royalty guarantee of any succeeding annual period in either the initial or
renewal term(s).
(c) Periodic Statements: Within thirty (30) days after the close of the
calendar quarter in which the initial shipment of articles covered by this
Agreement is made, and thereafter within thirty (30) days after the close of
each calendar quarter, Licensee shall furnish to YMC and YMUS, in the form
attached hereto as Exhibit B, signed by Licensee and certified as accurate
indicating all of the following information by month:
(1) Total invoice price of all licensed Articles Sold by Licensee
or its Affiliates during the period covered by such percentage
royalty payment.
(2) Computation of the amount of percentage royalty payable
hereunder for said period.
(3) Identification of the customers and the licenses Articles
including SKU, description and quantity that they purchased.
Such statements shall be furnished to YMUS and YMC, whether or not
any of the Articles have been Sold during said period. All information shall be
shown separately for each country within the territory. Licensee agrees that
royalty reports will indicate clearly (by name of character or similar
description) the Articles Sold and will be given in sufficient detail to YAMAHA
to separate royalties by Article. It is understood that timely rendering of all
statement required hereunder is essential under the terms of this Agreement, and
failure to render such statements in a timely fashion shall be deemed to be a
breach of the Agreement immediately after the deadline has gone by, regardless
of whether YMUS gives Licensee notice to this effect.
(d) Records and Audits: Licensee shall keep and maintain complete and
accurate records of the transactions underlying the accounting statements to be
furnished hereunder, and shall allow representatives of YMUS during office hours
and upon reasonable notice to Licensee to inspect and make extracts or copies of
such records for the purpose of ascertaining the correctness of such statements.
If any such examination or audit shall reveal a deficiency of Royalty Payments
due YMC, Licensee shall send payment to YMC with copy to YMUS, within ten (10)
days of receipt of notice to cure the deficiency to YMC of any deficiency plus
interest from the date when such deficiency should have been paid at 2% above
the prime rate as quoted by the Chase Manhattan Bank in New York for the period
of such deficiency. Furthermore, in the event such examination or audit reveals
any deficiency of five percent (5%) or more, Licensee shall pay, in addition to
such deficiency, the cost of such examination and audit. Upon demand of YMUS,
but not more than twice in any twelve (12) month period, Licensee shall at its
own expense furnish to YMC and YMUS a detailed statement prepared by an
independent certified public accountant showing the style number, sales of each
respective style number, description, gross sales price, itemized deductions
from gross sales price, Net Sales of the Articles covered by this Agreement
distributed and/or Sold by Licensee to the date of YMC and YMUS' demand. All
books of account and records shall be kept available for at least five (5) years
after the termination of this license.
(e) Royalty Payments: Licensee shall remit to YMC with copy to YMUS, the
royalties due in excess of any previously paid advance sum for each calendar
quarter within thirty (30) days after the close of each calendar quarter, and
payment shall be made with the statement rendered for that quarter. Payment
shall be in U.S. funds payable to YMC. The receipt or acceptance by YMC of any
of the statements hereunder, or any royalties paid hereunder, or the cashing of
any royalty check paid hereunder, shall not preclude YMC or YMUS 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 be immediately rectified with the appropriate payment made by Licensee in
accordance with the terms stated in Paragraph 2(d).
3) LICENSOR'S RIGHTS
Licensee recognizes all of YMC's rights and interest in and to the
Property and that all use of the Property licensed hereunder inures to the
benefit of YMC. No right, title, or interest, except the license interest
granted by Paragraph 1 hereof, is transferred by this Agreement to Licensee.
Licensee agrees that it shall not claim any title to or right to use the
Property except pursuant to this Agreement, and it shall not at any time attack
or challenge the right of YMC in and to the Property, regardless of the nature
or basis or forum of such attack or challenge, and regardless of whether it
relates to title or validity. Licensee hereby agrees that at the termination or
expiration of this Agreement, Licensee will be deemed to have assigned,
transferred and conveyed to YMC all rights in the Property which may have been
obtained by Licensee or which may have vested in Licensee as a result of its
activities under this Agreement, and Licensee will execute any reasonable
instruments requested by YMUS to accomplish or confirm such assignment, transfer
and conveyance. No consideration other than the mutual covenants and
considerations of this Agreement shall be necessary for any such assignement,
transfer or conveyance.
4) ADVERTISING
(a) Licensee agrees not to advertise or publicize any of the Articles
licensed hereunder in any medium without the prior written approval of YMUS,
which approval shall not be unreasonably withheld.. All advertising and
promotional materials including, but not limited to, artwork, displays, and
copy, shall be submitted by Licensee to YMUS for written approval prior to the
use of any such advertising or promotional materials.
(b) YAMAHA shall use the Property and shall have the right to use
Licensee's name so as to give the Property, Licensee, YAMAHA, and any other
production in any medium, which may be based upon the Property, full and
favorable prominence and publicity. YAMAHA shall not be under any obligation
whatsoever to advertise, broadcast, exhibit or use the Property or any person,
character, symbol, design or likeness or visual representation thereof in any
medium.
5) QUALITY OF MERCHANDISE
(a) Licensee agrees that the Articles covered by this Agreement at all
times shall be of high standard and of such style, appearance and quality as to
protect and enhance the Property and the good will pertaining thereto, shall
meet YAMAHA'S quality standards and specifications, and shall be manufactured,
Sold, distributed and promoted in accordance with all applicable Federal, State
and local laws. Before selling or distributing any of the Articles, Licensee
shall furnish to YMUS free of cost, for its written approval, the following in
the order listed:
1) Sketches (when applicable)
2) Finished artwork and final proofs (when applicable)
3) Pre-production samples or strike offs.
4) Finished products, including packaged samples.
5) All other finished displays, labels, packing and wrapping
material.
The quality and style of such Articles as well as of any finished
displays, labels, packing or wrapping material shall be subject to the approval
of YMUS. Any item submitted to YMUS shall not be deemed approved unless and
until the same shall be approved by YMUS in writing. After samples have been
approved pursuant to this paragraph, Licensee shall not depart there from in any
material respect without YMUS' prior written consent, and Licensor shall not
withdraw its approval of the approved samples except on sixty (60) days prior
written notice to Licensee. In the event YMUS does withdraw its prior written
approval, Licensee has one hundred and eighty (180) days to sell off any of its
Articles on hand or in process at the time, with any of the prior approved
artwork. Before Licensee has commenced selling any such Articles covered by this
Agreement, Licensee shall furnish to YMUS without cost twelve (12) samples of
each such Article, together with any displays, labels, packing and wrapping
material used in connection therewith. Thereafter, YMUS may request from time to
time, individual random samples of each Article and its related material as
herein before described, being manufactured and Sold by Licensee hereunder.
(b) YAMAHA shall have the right to take samples at random from production
runs twice a year but that, if quality problems are encountered as a result of
the examination of samples, YAMAHA shall have the right to take such samples
more frequently in an effort to assure that proper quality control has been
established. YAMAHA shall also have the right to have its representatives visit
the plant or plants where the Articles covered by this Agreement are made and
where the displays, packaging material and the like are printed or produced in
order to determine whether or not proper quality controls are being exercised.
6) LABELING
Licensee shall cause to appear on or within each Article Sold by Licensee
under the terms of this Agreement, and on or within all advertising, promotional
or display material and on all packaging, wrappers, labels, tags, and any other
printed material employing the Property, the copyright notice as specified in
Schedule G, attached hereto, or other notice or notices as may reasonably be
specified by YMUS, to the extent that this may be feasible in light of the size
and nature of the Articles and associated materials. Licensee shall cause to
appear on all Articles Sold by Licensee under the terms of this Agreement and on
all advertising, promotional and display material, and on all packaging,
wrappers, labels, tags, and other printed material used on or in connection with
the Articles employing the Property, appropriate trademark or service mark
notices, approved by YMUS, which, in case of goods sold in the United States
under registered trademarks and service marks, shall be (R) (or "Registered in
the United States Patent and Trademark Office" or "Reg. U.S. Pat. & TM. Off").
Each and every tag, label, wrapping, and packaging containing any such notice
and all advertising, promotional or display material bearing the Property shall
be submitted by Licensee to YMUS for its written approval prior to use by
Licensee. Approval by Licensor shall not constitute waiver of Yamaha's rights or
Licensee's duties under any provisions of this Agreement.
7) APPROVALS BY YAMAHA
Any such request for approval shall be submitted to YMUS on the two page
form attached hereto as Exhibit A. With respect to all written approvals by YMUS
required under Paragraphs 5(a), 6(a), and 7 of this Agreement, each item
submitted by Licensee shall be deemed disapproved if Licensee has not received
written approval from YMUS of the items in questions within fifteen (15)
business days after its submission by Licensee to YMUS. Nothing herein, however,
shall be deemed to obligate YMUS to respond to any such submission prior to the
expiration of the fifteen (15) business day period provided hereunder.
8) YAMAHA'S WARRANTY AND INDEMNIFICATION
(a) YMC represents and warrants that it holds all such rights and interest
in the Property as are required to permit YMC and YMUS to enter into this
Agreement and this it is authorized to enter into and perform this Agreement.
Furthermore, YMC represents and warrants that the Property is valid and
subsisting and that it shall, at its own expense, maintain same in good standing
including effecting any requisite registrations and renewals thereof.
(b) YMC and YMUS represents and warrants that use of the Property in
connection with the manufacture, distribution, sale and promotion of the
Articles will not violate or infringe the right of any third party.
(c) YAMAHA represents and warrants that any products that have been or
will be licensed by YAMAHA to other licensees do not and will not violate any of
the rights that YAMAHA has granted to Licensee under the terms of this
Agreement. YAMAHA also represents and warrants that the Property licensed to
Licensee for use on the Articles under the terms of this Agreement does not
violate any of the rights that the YAMAHA has granted or will grant to other
licensees. YAMAHA hereby represents, warrants and indemnifies Licensee against
and undertakes to hold it harmless from all actions, claims or suits brought
against Licensee arising out of the use of the Property by Licensee that relate
to Licensor's possession of right, title and interest in the Property and/or to
YAMAHA's entitlement to grant this license for the use of the Property on and in
connection with the manufacture, sale, distribution and promotion of the
Articles set forth in Schedule B. Licensee agrees that:
1) Licensee shall provide YMUS with prompt notice of any such
action, claim or suit;
2) YMUS shall have the sole right and option to undertake and
conduct the defense of any action, claim or suit so brought;
3) If Licensee with the authorization from YMUS, undertakes and
conducts the defense of any such action, claim or suit,
Licensee shall not make or execute any settlement of any
action, claim or suit without the prior written consent, of
YMUS; and
4) Licensee shall reasonably cooperate with YMUS in any action,
claim or suit undertaken and conducted by YMUS.
(d) YAMAHA shall indemnify and hold Licensee harmless from and against any
and all damages, liabilities, costs (including reasonable attorneys' fees) and
expenses incurred by Licensee as a result of any temporary or final legal
judgment or settlement arising out of or resulting from any alleged breach by
YAMAHA of the representations and warranties contained in Paragraph 9(a), 9(b)
and 9(c) to the extent such judgment(s) and settlement(s) relate(s) to aspects
of the licensed Articles covered by this Agreement.
(e) Licensee shall give YMUS thirty (30) days notice to correct any
alleged breach by YAMAHA, and Licensee will not commence any action against
YAMAHA or any other licensees of the Property without giving Licensor thirty
(30) days prior notice of such suit, nor will it in any such action seek
preliminary injunctive relief or a temporary restraining order against use of
the Property without giving YAMAHA fifteen (15) days notice of motion. It is
expressly agreed that a breach of the terms of this subsection shall be adequate
grounds for termination of this license, which termination shall be effective
forthwith upon YMUS' mailing a notice to Licensee in accordance with the notice
provision of Paragraph 20. Termination of this Agreement pursuant to this
subsection shall be without prejudice to any rights that Licensee may otherwise
have against YAMAHA.
9) PROTECTION OF YAMAHA'S RIGHTS
Licensee agrees to use its best efforts to assist YAMAHA to the extent
necessary to protect YAMAHA's rights to the Property. YAMAHA may commence or
prosecute any actions, claims or suits in its own name or in the name of
Licensee, or join Licensee as a party thereto. Licensee shall notify YMUS in
writing of any infringements or imitations of the Property on Articles similar
to those covered by this Agreement which may come to Licensee's attention, and
YMUS shall have the sole right to determine whether or not any action shall be
taken on account of any such infringements or imitations. Licensee shall not
institute any suit or take any action on account of any such infringements or
imitations without first obtaining the written consent of the YMUS to do so.
10) INDEMNIFICATION BY LICENSEE AND INSURANCE
(a) Licensee shall defend and indemnify both YMUS and YMC, its officers,
directors, agents and employees, against all costs, expenses and losses
(including reasonable attorneys' fees) incurred through claims of third parties
against YMUS and/or YMC based on the manufacture or sale of the Licensed
Products including, but not limited to, a result of temporary or final legal
judgment arising out of any alleged unauthorized use of any patent, copyright,
design, mark, process, idea, method or device by Licensee in connection with the
Articles covered by this Agreement (except for claims that the Property
infringes any copyright, design, patent, mark or idea) or any other alleged act
or omission by Licensee and from all claims, suits, loss or damages arising out
of alleged defects in the Articles, or any alleged failure adequately to perform
any agreement or render any service in respect of the Articles, or any injury
resulting from the use of the licensed Articles or the rendering of any services
in respect of the Articles. The provisions of this subsection (a) shall survive
the termination of this Agreement.
(b) Prior to the first offer for sale of any Licensed Article and during
this Agreement and for three (3) years after its expiration or termination,
Licensee will obtain, at it's own expense, general liability insurance,
including product liability, complete operations liability, contractual
liability, and advertising injury insurance for the Licensed Articles, related
trade dress, containers, and advertising and promotional materials from a
recognized insurance company that is licensed to do business in any state within
the United States, providing adequate protection for YMUS and YMC (as well as
for Licensee) as set forth in Schedule I, attached hereto. Licensee further
agrees that YAMAHA will have the annual right to require Licensee to cause such
insurance policy or policies limits to be increased by a reasonable amount or
modified form and content in reasonable way. Such policy shall provide
protection against any and all claims, suits, loss, causes of action or damage
arising directly or indirectly from or out of the design, testing, manufacture,
sale, distribution, advertisement, labeling, safety, use, misuse, or out of any
alleged defects or failure to perform in the Articles or any material used in
connection therewith or any use thereof, with such policy naming Yamaha Motor
Corporation, U.S.A. and Yamaha Motor Co., Ltd. and its employees as an
"Additional Insured". Such insurance policy shall provide that it cannot be
canceled without thirty (30) days prior written notice to YMUS. As proof of such
insurance, a fully paid certificate of insurance naming YAMAHA, its employees as
an "Additional Insured" party shall be submitted to YMUS by Licensee for YMUS'
prior approval before any Article is distributed or Sold hereunder, and no later
than thirty (30) days after the commencement of the initial term of this
Agreement. Any proposed change in certificates of insurance shall be submitted
to YMUS for its prior approval. YMUS shall be entitled to a copy of the ten
prevailing certificate of insurance, which shall be furnished to YMUS by
Licensee.
(c) For purposes of this paragraph, "YAMAHA, YMUS, YMC" shall also include
the grantor(s), officers, directors, agents and employees of YAMAHA, YMUS, YMC
its Affiliates, and any other product in any medium, which may be based upon the
Property, the producers of said products, any sponsor of said products and its
advertising agencies, and their respective officers, directors, agents and
employees.
11) ARTWORK AND PROMOTIONAL MATERIAL
In all cases where Licensee desires artwork and related material in
connection with its use and promotion of the Property, the cost of same and the
time for production thereof shall be borne by Licensee. All such artwork and
related material incorporating the Property or any production thereof,
notwithstanding their invention, creation or use by Licensee, shall be and
remain the property of YMUS; and YMUS shall be entitled to use the same and to
license the use of same by others provided such use does not conflict or compete
with or impair or diminish Licensee's use thereof during the term of this
Agreement.
12) YAMAHA's REPUTATION
Licensee agrees that it will not do any act or thing which may in the
reasonable opinion of YAMAHA bring YAMAHA or its products into contempt, serious
disrepute or ridicule or portray any of these in a manner which is or can be
reasonably construed as being grossly offensive or unsafe (e.g., encouraging
reckless and unsafe riding or racing on an open public roadway); include any
material in the Licensed Product which is lewd, grossly obscene or defamatory
under the law of any country in which the Licensed Product is officially
distributed (e.g., obscene language, nudity); and do any act which, in the
reasonable opinion of YAMAHA, damages or tarnishes the goodwill, image, or
reputation of YAMAHA, and their respective products and trademarks.
13) DISTRIBUTION
(a) During the term of this Agreement, Licensee will diligently and
continuously manufacture, offer to sell, distribute and promote the Articles
covered by this Agreement and will make every effort to maintain adequate
arrangements for the efficient distribution of the Articles. In this respect
Licensee shall offer for sale by the marketing date specified in Schedule H,
attached hereto, with delivery within a reasonable time thereafter, at least one
of the Articles in each of the categories listed in Schedule B. If at any time
thereafter Licensee for a period of three (3) consecutive months has failed to
offer to sell and to manufacture and distribute any of the Articles (or any
class or category of the Articles) covered hereunder, YAMAHA, in addition to all
other remedies available to it hereunder, may terminate this Agreement with
respect to such Articles or class or category thereof which have not been so
offered for sale and manufactured and distributed during such period by giving
notice of termination to such effect to Licensee in accordance with the notice
provision of Paragraph 19. Without limiting the foregoing, or any other
obligations of Licensee under this Agreement, but on the condition that YMUS
provides prior written notice in accordance with the notice provision of
Paragraph 19.
(b) Licensee shall not knowingly sell or distribute the Articles to
jobbers, wholesalers, distributors, retail stores, merchants or any other third
party whose sales or distribution are or will be made for publicity or
promotional tie-in purposes, combination sales, premiums, giveaways or similar
methods of merchandising without prior approval.
(c) In the event any sale is made at a special price to any of Licensee's
Affiliates or to any other person, firm, or corporation related in any manner to
Licensee or its officers, directors or major stockholders, Licensee shall pay a
royalty on such sales based upon the price generally charged the trade by
Licensee.
(d) Licensee agrees to keep YMUS, at its request, advised of the wholesale
and suggested retail prices at which Licensee sells the Articles covered
hereunder.
(e) Licensee will sell to YAMAHA such quantities of the Articles as YMUS
shall request at as low a rate on as good terms as Licensee sells similar
quantities of the Articles to the general trade.
14) DEFAULT & TERMINATION
The following termination rights are in addition to the termination rights
provided elsewhere in the Agreement.
(a) Immediate Right of Termination. YAMAHA shall have the right to
immediately terminate this Agreement by giving written notice to Licensee in the
event that Licensee does any of the following:
1) unless otherwise prohibited by law, if a petition in
bankruptcy is filed by or against Licensee and such
petition is not vacated within sixty (60) days, or if
Licensee becomes insolvent, or makes an assignment for
the benefit of its creditors or an arrangement pursuant
to any bankruptcy law, or if Licensee discontinues its
business or if a receiver is appointed for it or its
business, to the fullest extent permitted by law at the
time of the occurrence, the license hereby granted shall
automatically terminate forthwith without any notice
whatsoever being necessary. In the event this Agreement
is terminated as a result of the bankruptcy or
insolvency of Licensee, Licensee, its receivers, agents,
representatives, trustees, administrators, successors,
and/or assignees shall have no right to sell, exploit or
in any way deal with or in any Articles covered by this
Agreement or any carton, container, packing, or wrapping
material, advertising, promotional or display material
pertaining thereto, except with and under the special
consent and instructions of Licensor in writing, which
they shall be obligated to follow;
2) after having commenced sale of the License Articles,
fails to continuously sell Licensed Products for three
(3) consecutive Royalty Periods;
3) fails, after receipt of written notice from YAMAHA,
to immediately discontinue the distribution or sale of
the Licensed Articles or the use of any packaging or
promotional material which does not contain the
requisite legal legends; or
4) fails to make timely payment of Royalties when two or
more times during any twelve-month period.
14) BREACH
(a) If either party has materially breached or failed to perform any of
its respective obligations under the terms of this Agreement, the other
(nonbreaching) party shall have the right to terminate the license hereby
executed upon thirty (30) days notice in writing, in accordance with the notice
provision of Paragraph 19, unless the breaching party shall completely remedy
the breach within the thirty (30) day period, and satisfy the other
(nonbreaching) party that the failure or breach has been remedied. Termination
of the license under the provisions of this subsection (a) shall be without
prejudice to any rights, which either party may otherwise have against the other
party. Upon termination of this license, if such termination is a result of
breach by Licensee, all guaranteed royalties on sales therefore made shall
become immediately due and payable; no advances against royalties shall be
repayable; and the balance of any minimum royalty guarantees shall become
immediately due and payable.
(b) Furthermore, in the event that litigation of any nature with respect
to the performance by YAMAHA or Licensee of their obligations hereunder is
initiated, costs and expenses shall be payable in accordance with any order of
the court or arbitration panel presiding over such ruling.
15) FINAL STATEMENT UPON TERMINATION OR EXPIRATION
Sixty (60) days before the expiration of this license and, in the event of
its termination, ten (10) days after receipt of notice of termination or the
happening of the event which terminates this Agreement where no notice is
required, a statement showing the number and description of Articles covered by
this Agreement on hand or in process shall be furnished by Licensee to YMUS.
YMUS shall have the right to take a physical inventory to ascertain or verify
such inventory and statement, and refusal by Licensee to submit to such a
physical inventory by YMUS shall forfeit Licensee's right to dispose of such
inventory, with YMUS retaining all other legal and equitable rights Licensor may
have in the circumstances.
16) DISPOSAL OF STOCK UPON TERMINATION OR EXPIRATION
After termination or expiration of the license under the provisions
hereof, Licensee, except as otherwise provided in this Agreement, may dispose of
Articles covered by this Agreement which are on hand or in process at the time
notice of termination is received or upon the expiration date, whatever the case
may be, for a period of sixty (60) days thereafter, on a nonexclusive basis,
provided advance and royalty payments are up to date for the current period and
statements are furnished for that period in accordance with Paragraph 2. All
applicable royalties which are to be paid on Articles on hand or in process at
the time of termination shall be paid within twenty (20) days from the time the
termination notice is received. The sell off period can not commence until
sender has received from Licensee, the applicable prepaid royalty, with a copy
to YMUS, for all of the Articles that are on hand or in process at the time of
termination. Notwithstanding anything to the contrary herein, Licensee shall not
manufacture, sell or dispose of any Articles covered by this license after its
expiration or its termination based on the failure of Licensee to affix notice
of copyright, patent, trademark or service mark registration or any other notice
to the Articles, cartons, containers or packing or wrapping material or
advertising, promotional or display material, or because of the departure by
Licensee from the quality and style approved by YMUS hereunder.
17) EFFECT OF TERMINATION OR EXPIRATION
(a) Upon and after the expiration or termination of this license
Agreement, all rights granted to Licensee hereunder shall revert to YAMAHA, who
shall be free to license others to use the Property in connection with the
manufacture, sale, distribution and promotion of the Articles covered hereby,
and Licensee will refrain from further use of the Property or any further
reference to it, in connection with the manufacture, sale, distribution or
promotion of any product, except as provided in Paragraph (1 8). It shall not be
a violation of any right of Licensee if YAMAHA should, at any time during the
term hereof, enter into negotiations with another to license the use of the
Property with respect to the Articles listed in Schedule B, attached hereto,
within the Territory, provided that it is contemplated that such prospective
license agreement shall commence after the termination of this Agreement.
(b) Throughout and after the term of this Agreement, Licensee will not
manufacture, distribute, sell or promote any products with similar name, symbol,
logo or trademark to that of the Property. In the event that the Licensee does
manufacture, sell, distribute or promote any such products, the same shall be
governed by the terms of this Agreement, including without limitation, the
obligation to pay royalties in accordance with Paragraph 2 hereof.
18) LICENSOR'S REMEDIES
(a) Licensee acknowledges that its failure to commence in good faith to
offer to sell, manufacture, distribute and promote the Articles listed in
Schedule B within the period specified in Paragraph 13, and to continue during
the term hereof to use its best efforts to offer to sell, manufacture,
distribute and promote the Articles covered by this Agreement will result in
immediate and irreparable damage to Licensor.
(b) Licensee acknowledges that its failure (except as otherwise provided
herein) to cease the manufacture, sale, distribution or promotion of the
Articles covered by this Agreement at the termination or expiration of this
Agreement or any portion thereof will result in immediate and irreparable damage
to Licensor and to the rights of subsequent licensee. Licensee acknowledges and
admits that there is no adequate remedy at law for such failure to cease
manufacture, sale, distribution or promotion, and Licensee agrees that in the
event of such failure, YAMAHA shall be entitled to terminate this Agreement and
to equitable relief by way of temporary and permanent injunctions and such other
and further relief as any court of competent jurisdiction may deem just and
proper.
19) NOTICES
All notices and statements required under this Agreement shall be in
writing addressed to the parties as set forth in Schedule J attached hereto,
unless notification of a change of address is given in writing. All such notices
and statements shall be sent Certified Mail or Registered Mail, Return Receipt
Requested or by a reputable Commercial Air Express service (such as Fedex). The
date of mailing shall be deemed the date the notice or statement is received by
either party and such receipt is certified or registered with the post office or
commercial air express service.
20) RELATIONSHIP BETWEEN THE PARTIES
Except as otherwise provided in this Agreement, Licensee shall not
represent itself as the agent or legal representative of YAMAHA for any purpose
whatsoever, and shall have no right to create or assume any obligation of any
kind, express or implied, for or on behalf of YAMAHA in any way whatsoever. This
Agreement shall not create or be deemed to create any agency, partnership or
joint venture between the Licensee and YAMAHA.
21) NO ASSIGNMENT OR SUBLICENSE
None of Licensee's benefits or obligations under this Agreement shall be
transferred by assignment, merger, operation of law or any other means, nor
shall Licensee delegate any of said benefits or obligations by sublicensing or
any other means, except with the prior written consent of YMUS which consent
shall not be unreasonably withheld. Any transfer or delegation of any of
Licensee's rights in violation of the preceding sentences shall be null and
void. Any or all of YAMAHA's rights may be transferred or delegated by YAMAHA
without restriction of any kind. Subject to the foregoing, this Agreement shall
be binding upon and inure to the benefit of the parties, their successors and
assigns.
22) CONFIDENTIAL INFORMATION AND NON-DISCLOSURE
Licensee acknowledges that, in the course of the performance of this
Agreement, Licensee may obtain confidential information or materials from YAMAHA
including, without limitation, the following items related to the Property,
YAMAHA materials and/or Licensed Property: underlying literary material,
creative elements, style guides, research material and data, specifications,
processes, technological developments, or other proprietary materials. Licensee
shall, at all times both during the Term and thereafter, keep all of such
confidential information in confidence and trust. Licensee shall not use such
confidential information other than as expressly permitted herein or by
Approval. Licensee agrees to return to YMUS any written, printed or other
materials embodying such confidential information and/or materials, including
all copies or excerpts thereof, given to or acquired by Licensee in connection
with this Agreement. Licensee shall not directly or indirectly disclose to the
public or to any non-essential person and/or entity any of the terms of this
Agreement without the prior written approval of YMUS, unless otherwise required
to do so by any law established by any government with applicable jurisdiction.
Licensee acknowledges that any breach of the foregoing will cause irreparable
injury to YAMAHA not readily measurable in monetary amounts; consequently,
YAMAHA shall, without waiving any other rights or remedies, be entitled to
injunctive and/or declaratory relief in connection with any breach or threatened
breach hereof.
23) ENTIRE AGREEMENT
This Agreement and the Schedules attached hereto, is intended by the
parties as a final and complete expression of their agreement, and supersedes
any and all prior and contemporaneous agreements and understandings related to
it.
24) MODIFICATION AND WAIVER
This Agreement may not be modified and none of its terms may be waived,
except in writing signed by all parties. The failure of any party to enforce, or
the delay by any party in enforcing, any of its rights shall not be deemed a
continuing waiver or a modification of this Agreement.
25) ACT OF GOD
Neither party shall be responsible for or liable for failing to perform
any part of this Agreement or indirectly resulting from or contributed to by any
foreign or domestic embargoes, seizures, acts of God, insurrections, wars and/or
continuance of war; acts of terrorism or the adoption or enactment of any law,
ordinance, regulation, ruling or order directly or indirectly interfering with
the performance under this Agreement; or lack of the usual means of
transportation, fires, floods, explosion, strikes, earthquakes; or other events
or contingencies beyond its control, either of the foregoing nature or of any
kind.
25) PARAGRAPH HEADINGS
The headings of the paragraphs are for convenience only and in no way
limit or affect the provisions hereof.
26) AGREEMENT COUNTERPARTS
This Agreement may be executed in any number of counterparts and all of
these counterparts shall for all purposes constitute one Agreement binding on
the Parties and be deemed originals for all purposes notwithstanding that all
parties are not signatory to the same counterpart.
27) SPECIAL PROVISIONS
Licensee shall comply with the obligations set forth in Schedule B(x)
attached hereto. 28)
APPLICABLE LAW/VENUE
This Agreement shall be governed and construed and all disputes arising
hereunder shall be adjudicated, by application of the laws of the State of
California, and no other laws of any other jurisdiction, foreign or domestic,
shall apply. In the event that one or more provisions shall at any time be found
to be invalid or otherwise rendered unenforceable, such provision or provisions
shall be severable from this Agreement, so that the validity or enforceability
of the remaining provisions of this Agreement shall not be affected thereby.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
duly executed as of the day and year first above written.
YAMAHA MOTOR CORPORATION, U.S.A.
and YAMAHA MOTOR COMPANY, LTD.
By: /s/ S. Kato
-------------------------------------
S. Kato/President
Date: May 28, 2003
Padova International (dba Execute Sports)
(Licensee)
By: /s/ Don Dallape
-------------------------------------
Title: CEO
Name: Donald Dallape
Date Signed: 3/18/03