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Exhibit 10.4
CONCESSION
AGREEMENT
This
CONCESSION AGREEMENT (this “Agreement”) is entered into and effective as of
December 7, 1999, by and between WALT DISNEY WORLD CO.
(“Disney”), with a mailing address of P.O. Box 10,000, Lake Buena Vista, Florida
32830, and CRYSTAL MAGIC,
INC. (“Vendor”), with a mailing address of 2120 Hidden Pine Lane, Apopka,
Florida, 32712 whereby Vendor shall provide certain services and/or merchandise
for sale to guests of Epcot® (the “Premises”),
located at the WALT DISNEY
WORLD® Resort.
IN
CONSIDERATION of the mutual covenants contained herein, the parties agree as
follows;
1. Grant of
License. Disney hereby grants to Vendor a non-exclusive, non-transferable
license to enter upon the Premises to perform the services described on Exhibit A, attached
hereto and made a part hereof (the “Services”), and for no other purpose, Vendor
shall provide the Services at the Premises at Epcot® Imagination Institute
(the “Concession”). The provisions of this Agreement shall be deemed to create a
mere license only, and shall not be construed no be a lease, sublease,
assignment, easement or” any other conveyance of any interest in or to the
Premises or in or to anything contained therein or thereon. Vendor shall not
make any alterations or modifications to the Premises or the Concession without
the prior written approval of Disney, which approval may be withheld by Disney
in its sole discretion. Disney may enter the Concession at any time for any
purpose Including, without limitation, ensuring that Vendor is complying with
the terms of this Agreement.
2. Name of
the Concession. The name and any changes to the name of the Concession
must be pre-approved in writing by Disney in its sole discretion. Unless
otherwise agreed in writing by Disney, in its sole discretion, in providing the
Services, Vendor shall not identify the name of Vendor or the brand name of the
merchandise, products or services being offered by Vendor at the
Concession.
3. Days and
Times of the Services, Vendor shall provide the Services at the
Concession on the days and times as set forth on Exhibit
A, or such other days and times as Disney shall designate in its sole
discretion.
4. Term,
The term of this Agreement shall commence on December 7, 1999, and continue
through and including September 30, 2006 (the “Term”), unless either party
terminates this Agreement, with or without cause, by providing the other party
with sixty (60) days’ prior written notice, In addition, Disney may terminate
this Agreement for cause (e.g., if Vendor fails to perform any of its
obligations under this Agreement) immediately by giving notice to Vendor, The
parties mutually agree that there may be a period during the Term during which
the Concession will be closed by Disney for, among other reasons, maintenance
and rehabilitation of the Premises or special events (the “Closed Period”). The
existence of the Closed Period shall not extend the Term or release the parties
from their obligations hereunder.
5. Merchandise/Other
Products/Services. Vendor shall provide the merchandise, other products
and/or services in connection with the Services, as identified in Exhibit,
B. attached hereto and made a part hereof. All changes in the
merchandise, other products and/or services shall be approved by Disney in
writing in its sole discretion, Disney shall have the right, in its sole
discretion, to require Vendor to remove any merchandise, other products and/or
services from the Concession and/or to add any merchandise, other products
and/or services to the Concession; provided, however, that Disney shall not have
the right to requite Vendor to remove crystal glass cubes completely from the
Concession without the prior written approval of Vendor
6. Inventory/Equipment/Supplies.
Vendor will provide all inventory, equipment and supplies necessary to provide
the Services including, but not limited to. the equipment described on Exhibit
C, attached hereto and made a pan hereof (the “Equipment”) All of the
inventory, Equipment and supplies shall be subject to the prior approval of
Disney in its sole discretion. Vendor shall keep the Concession fully supplied
at all times. Vendor shall regularly inspect and service the Equipment, keeping
each piece of Equipment in good working order. Vendor will be responsible for
cleaning below, above and behind the Equipment and for complying with all other
applicable rules and regulations relating to the Equipment Including, but not
limited to, those rules and regulations more fully set forth in Exhibit
D, attached hereto and made a part hereof. During the Term, Vendor shall
retain ownership of all of the inventory, Equipment and supplies necessary to
provide the Services and all risk of loss thereto shall be borne solely by
Vendor, except to the extent such loss is caused solely by Disney’s gross
negligence or willful misconduct. Maintenance of the Equipment during the Term
shall be Vendor’s sole responsibility. Upon the expiration or sooner termination
of this Agreement, Vendor shall promptly remove all of its inventory, Equipment
and supplies from the Premises. If Vendor shall fail to remove any of its
inventory, Equipment or supplies from the Premises, Disney may, at its option,
either remove and dispose of any or all of the same at Vendor’s expense or
retain the same, in which latter event all right, title and interest therein
shall pass to and vest m Disney.
7. License
To Use Disney Characters.
a. Disney
hereby grants to Vendor a revocable, non-transferable, royalty-free,
nonexclusive license to use the characters identified on Exhibit B
only. On the merchandise identified on Exhibit
B. Vendor acknowledges that Disney has adopted the Code of Conduct for
Manufacturers (the “Code”) set forth on Exhibit
D. attached hereto and made a part hereof. If Vendor, at any time,
desires to utilize a third party to manufacture or produce any of the
merchandise identified on Exhibit
B. Vendor will notify Disney of the names and physical street addresses
of such third parties (individually, a “Third Party” and collectively, the
“Third Panics”), Disney shall have the right, in its sole discretion, to approve
in writing all of the Third Parties, If Disney does not approve in writing any
Third Party, Vendor shall not use such Third Party to manufacture or produce the
merchandise identified on Exhibit
B. If Disney approves a Third Party in writing, Vendor may use such Third
Party to manufacture or produce the merchandise identified on Exhibit
B
b. To
the extent Vendor wishes to manufacture or produce any of the merchandise
Identified on Exhibit
B itself, Vendor shall adopt the Code and shall evidence such adoption by
executing a copy of the Code and delivering the originally executed copy of the
Code to Disney prior to Vendor’s commencement of the manufacture or production
of the merchandise identified on Exhibit
B
c. Disney
shall have the right, in its sole discretion, to withdraw its approval of any
Third Party at any time. If Disney withdraws its approval of any Third Party.
Vendor shall immediately stop using such Third Party to manufacture or produce
the merchandise identified on Exhibit
B. provided, however, that Vendor shall be permuted to sell ail of such
merchandise in its inventory, unless Disney provides otherwise in writing to
Vendor
d. Disney
shall have the right to evaluate and monitor Vendor to ensure that Vendor is
only using Third Parties approved by Disney hereunder to manufacture and produce
the merchandise identified on Exhibit
B including, but not limited to, on-sire inspections and reviews of books
and records
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e. Vendor
shall not sell or use the merchandise identified on Exhibit
B at any ocher location or for any purpose other than in connection with
[he Services, unless approved by Disney in its sole discretion. Upon the
expiration or sooner termination of this Agreement, Vendor shall return to
Disney any remaining Inventory of such merchandise.
8. Signage.
Disney shall provide, at its sole cost and expense, such signage and promotional
materials for the Concession as Disney deems necessary, in its sole discretion.
Vendor shall not display or distribute any other signage or promotional
materials at the Concession.
9. Uniforms.
Disney will provide all uniforms for Vendor and its employees. Vendor
acknowledges and agrees that Vendor has no ownership rights in the uniforms
Vendor shall return the uniforms to Disney for cleaning and maintenance as
Disney may require during the Term. Vendor shall keep such uniforms clean and
professional at all times in accordance with Disney’s safety and appearance
standards whenever Vendor or its employees are performing the Services. Upon
expiration or sooner termination of this Agreement, Vendor shall immediately
return the uniforms to Disney Vendor will be responsible for reimbursing Disney
for Disney’s uniform cleaning, maintenance and /or replacement costs for Vendor
and Vendor’s employees upon receipt of a monthly invoice from Disney. To the
extent any of the uniforms are lost or substantially damaged, as determined by
Disney in its sole discretion. Vendor agrees to reimburse Disney for the
replacement costs of such uniforms.
10. Disney’s
Responsibilities During the Term, Disney shall be responsible for the
following, at its sole cost and expense:
a. Utilities
(other than telephone). In no event shall Disney be liable or responsible for
any interruption or disruption of utility service and Vendor hereby waives any
and all claims against Disney for any loss, damage or expense arising out of, or
incurred In connection with, any such interruption or disruption,
and
b. Trash
pick up.
11. Vendor’s
Responsibilities. During the Term, Vendor shall be responsible for the
following, at its sole cost and expense:
a. Telephone
service; and
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b.
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Keeping
the Concession clean, sanitary and free from trash and
debris,
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12. Compensation for the
Services.
a. Vendor’s
compensation for the Services shall be based solely on the Services
provided
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b. All
sales at the Concession are to be handled by Disney’s personnel whether on sue
or by mail order or drop shipping. Vendor shall not accept any money from guests
but shall refer all sales transactions, including special orders and mail
orders, to Disney personnel for processing through cash registers in accordance
with Disney’s standard sales procedures.
c. Disney
shall collect the compensation from the guests and shall pay to Vendor sixty
percent (60%) of gross revenues from retail sales from the Services, less
applicable sales, use, excise or other taxes. Disney shall retain the remaining
gross revenues from retail sales from the Services. The term “gross revenues
from retail sales from the Services” is denned as all monies and other things of
value received by, or paid to, Disney and all credit extended by Disney, arising
upon, out of or in connection with the Services at the Concession during the
Term, plus the amount of any applicable sales, use, excise or other taxes, less
the amount of any of Vendor’s merchandise or products which are returned to
Disney or replaced by Disney, less the amount of any refunds made by Disney in
connection with the Services, less the amount of any cancelled orders for
Vendor’s merchandise or products. Such fee shall be payable on or before
Thursday of each week with respect to gross revenues from retail sales from the
Services made during the preceding week (Sunday through Saturday), through and
including the calendar week immediately following the expiration or sooner
termination of this Agreement.
d. Disney
shall maintain complete and accurate records evidencing the gross revenues from
retail sales from the Services Disney agrees to make available to Vendor once
each calendar year, upon thirty (30) days’ prior written request by Vendor, a
full, permanent and accurate set of Disney’s accounting books and records
relating solely to gross revenues from retail sales from the Services. Vendor
will have the right, at its sole cost and expense, to audit said books and
records, Disney agrees to keep all such books and records for at least three (3)
years following the expiration or sooner termination of this
Agreement.
13. Taxes.
a. Amounts
retained by Disney or paid to Disney under this Agreement may be subject to tax.
Accordingly, the applicable sales, use excise or other taxes on such amounts
shall be deducted from Vendor’s compensation and retained by Disney or paid to
Disney by Vendor, as appropriate.
b. On
or before the 10th day of
each month during the Term (including the month immediately following the
expiration or sooner termination of this Agreement), Vendor shall supply Disney
with a copy of Vendor’s monthly sales tax report submitted to the State of
Florida, Department of Revenue
14. Exhibits
The exhibits referred to in, and attached to, this Agreement are hereby
incorporated herein by reference. Unless otherwise expressly provided in the
exhibit or the body of this Agreement, in the event of any conflict or
inconsistency with the provisions contained in the body of this Agreement and
the exhibits, the provisions contained in the body of this Agreement shall
prevail.
15. Miscellaneous.
The GENERAL TEPMS AND
CONDITIONS attached to this Agreement are hereby incorporated herein by
reference, This Agreement constitutes the entire agreement of the panics hereto
with respect to the subject matter of this Agreement and supersedes any and all
previous agreements between the panics, whether written or oral, with respect to
such subject matter, Any modification of this Agreement shall be in writing and
signed by both parties, If any provision of this Agreement is deemed to be
invalid, it shall be considered deleted herefrom and shall not invalidate the
remaining provisions.
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16. Signature
Authority The person who executes this Agreement on behalf of either
party hereto expressly represents and warrants that he/she has full and complete
authority to do so, knowing that the other party intends to rely solely
thereon.
17. No
Offer. This instrument does not constitute an offer by Disney. When
executed by Vendor, it shall constitute an offer by Vendor to Disney irrevocable
for a period often (10) days after receipt by Disney and, upon execution by
Disney and delivery to Vendor, shall constitute a binding agreement between the
parties.
IN WITNESS WHEREOF, the parties
have executed this Agreement as of the date first above written.
(“DISNEY”) (“VENDOR”)
WALT
DISNEY WORLD
CO, CRYSTAL
MAGIC, INC
By: /s/ Karl L. Holz By: /s/ Steven M. Rhodes
Print
Name: Karl L. Holz
Print
Name: Steven M. Rhodes
Title: Vice President Title: President
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GENERAL TERMS AND
CONDITIONS
A. Control
of the premises. Nothing in this Agreement is intended or shall be deemed
or construed to grant to or confer upon Vendor any rights whatsoever in respect
of the Premises, including, without limitation, rights in connection with the
closing, alteration, discontinuance, condemnation or casualty loss thereof.
Accordingly, without limiting the generality of the foregoing. Disney shall have
ultimate and unfettered control over the Premises.
B. Themed
Cart. If requested by Disney, Vendor shall provide a cart for use in
connection with the Services. Disney shall have the right to approve every
aspect of the Cart, including, without limitation, design, theming and signage,
such approval to be in Disney’s sole and absolute discretion; provided, however,
that by giving any such approval, Disney shall not assume responsibility for the
quality, workmanship and/or safety of such cart. Once approved, Vendor shall not
change the design, theming or any other aspect of the cart without the express
written approval of Disney, which approval may be withheld by Disney in its sole
discretion. Vendor’s expenditure of any monies in connection with the design,
construction, installation, removal, acquisition and/or operation of the cart
shall be at Vendor’s sole risk. Upon the expiration or sooner termination of
this Agreement, Disney shall have the right to request that Vendor remove any
theming from the cart and Vendor shall remove the cart from the Premises at its
sole cost and expense. If Vendor shall fail to remove the cart from the
Premises, Disney may, at its option, either remove and dispose of the cart at
Vendor’s expense or retain the same, in which latter event all right, title and
interest therein shall pass to and vest in Disney.
C. Disney’s
Approval of Cart Manufacturer. The architects, engineers, consultant and
general contractors selected by Vendor for the design and production of the cart
shall be licensed in the State of Florida and shall be subject to the prior
written approval of Disney, which approval may be withheld by Disney in its sole
discretion. If requested by Disney, Vendor shall furnish to Disney copies of all
contracts for any work in connection with the design and construction of the
cart (including, without limitation, all contracts for the purchase of materials
and supplies in connection therewith).
D. No
Representations or Warranties by Disney. Disney makes no representations
or warranties whatsoever in connection with this Agreement, including, without
limitation, the condition of the Premises, its suitability for the use described
herein or for any other use, the visibility, of the Concession to the guests of
the Premises, the profitability of the Services to be provided at the Concession
or the success or failure of the Services to be provided at the
Concession.
E. Participants.
Vendor acknowledges that Disney and its parent, related, affiliated and
subsidiary companies are parties to certain participant agreements and that
Disney and its parent, related, affiliated and subsidiary companies may enter
into additional participant agreements in the future. Vendor agrees to comply
with the provisions of such participant agreements as they exist from time to
time. Disney shall disclose the relevant provisions of such agreements to
Vendor.
F. Licenses.
Vendor and its employees shall be licensed as required by law. Vendor shall
obtain and maintain throughout the Term, all professional, occupational
equipment, and other licenses and permits required by law to perform the
Services and shall provide copies of such licenses to Disney upon
request.
G. Disney
Traditions/Guest Surveys/Meetings. If requested by Disney, Vendor and its
employees shall enroll in, at Vendor’s expense, and complete the Disney
Traditions class and any other Disney class that Disney deems necessary prior to
commencement of the Services or at any time thereafter as Disney may determine
in its sole discretion. Vendor and its employees shall, if requested by Disney:
(i) conduct or participate in guest evaluation and experience surveys at
periodic intervals relating to the Premises and/or the Concession and (ii)
attend meetings called by Disney.
H. Parking
Passes/ID Cards. Disney shall provide Vendor and its employees with
parking passes and ID cards to gain admission to the Premises and to the cast
parking lot at the Premises. Upon the expiration or sooner termination of this
Agreement, Vendor shall return to Disney all parking passes and ID cards issued
to Vendor and its employees pursuant to this Agreement.
I. Additional
Services/Disney Standard. Vendor shall pay Disney for any and all
services provided by Disney which are requested by Vendor, including, without
limitation, the installation of water lines and fixtures, electricity lines and
sanitary sewer. In addition, to the extent Disney determines that Vendor needs
additional equipment to provide the Services, including, without limitation,
lightning rods, Disney shall have the option of either requiring Vendor to
acquire and install such equipment at Vendor’s sole cost and expense or
acquiring and installing such equipment itself and then billing Vendor for such
equipment and installation. Further, to the extent Disney determines that any of
the equipment, supplies, signage or any other items or materials used by Vendor
in connection with the Services do not satisfy the Disney standard, as
determined by Disney from time to time, Disney shall have the option of either
requiring Vender to bring such equipment, supplies, signage or any other items
or materials into compliance at Vendor’s sole cost and expense or taking
whatever actions are required, as determined by Disney in its sole discretion,
to bring such equipment, supplies, signage or any other items or materials into
compliance and then billing Vendor for such actions.
J. Late
Charges. Any amounts payable by Vendor pursuant to this Agreement which
are not paid when due shall bear interest from the date due until the date paid
at the lesser of the maximum rate allowed by law or the annual rate of eighteen
percent (18%) and such interest shall be payable on demand. Vendor shall be
responsible for all costs and expenses that Disney, or its designee, may incur
in collecting any amount due from Vendor hereunder or in enforcing any of
Disney’s other rights or remedies under this Agreement, including, without
limitation, attorneys’ fees and fees of other professionals.
K. Credit
Cards/Charges. If so requested by Disney, Vendor will accept (in
accordance with procedures established by Disney from time to time) WALT DISNEY
WORLD® hotel identification cards, Disney Dollars and/or other Forms of resort
cards, gift certificates and package coupons distributed by Disney and/or any of
Disney’s parent, related, affiliated or subsidiary companies to guests at the
WALT DISNEY WORLD® Resort, for payment for the Services. Disney will pay Vendor
the total amount of all such card charges Disney Dollars, resort cards, gift
certificates and package coupons to the extent Vendor has complied with Disney’s
procedures, less a reasonable service fee (currently three and one-half percent
(3-1/2%) of the total amount of all such card charges, Disney Dollars, resort
cards, gift certificates and package coupons), and such amount paid by Disney to
Vendor shall be considered part of “gross revenues from retail sales from the
Services” for purposes of this Agreement. If so requested by Disney, Vendor will
also accept American Express, Visa, MasterCard, Discover Card, Diners; Club, JCB
(Japanese Credit Bureau) Card, and/or other credit cards in payment for the
Services.
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L. Guest
Claims. Vendor shall promptly inform Disney of any guest claims or
complaints and any such claims or complaints will be handled exclusively by
Disney’s personnel in accordance with Disney’s policies and
procedures.
M. Change of
Concession. Disney reserves the right to change the location of the
Concession at which Vendor performs the Services upon seven (7) days prior
notice to Vendor. Addition
