EXHIBIT 10.44 AGREEMENT

 

 

                                                                   EXHIBIT 10.44

 

                                                                  EXECUTION COPY

 

                                    AGREEMENT

 

      This Agreement (the "Agreement") is made as of December 22, 2004 (the

"Effective Date") among PEAK ENTERTAINMENT HOLDINGS, INC., with an address at

Bagshaw Hall, Bagshaw Hill, Bakewell, Derbyshire DE45 1DL, England, and PEAK

ENTERTAINMENT LTD., with an address at Bagshaw Hall, Bagshaw Hill, Bakewell,

Derbyshire DE45 1DL, England,, (together, "Peak") and MORRISON ENTERTAINMENT

GROUP, INC. ("MEG"), with an address at 1334 Parkview Avenue, Suite 300,

Manhattan Beach, California 90266, U.S.A.

 

      WHEREAS, MEG and Peak Entertainment Ltd. were parties to the In My Pocket

License Agreement dated February 25, 2002, as such agreement was amended (the

"IMP License"), which was terminated as of November 30, 2003; and

 

      WHEREAS, MEG, Peak Entertainment Ltd., and Mr. and Mrs. Wilfred Shorrocks

were parties to the Monster In My Pocket License Agreement (the "MIMP License")

dated March 9, 2004, which contained a license to certain intellectual property

in the MONSTER IN MY POCKET and other boys' IN MY POCKET trademarks, concepts,

products, designs and/or inventions, for which neither the license nor the MIMP

License became effective; and

 

      WHEREAS, in connection with the development of a television series and toy

products, Peak has entered into the license agreements with the Peak Licensees

(as defined below) granting rights related to the Peak Toy Series (as defined

below); and

 

      WHEREAS, the parties wish to clarify their rights in connection with

certain intellectual property owned by MEG;

 

      NOW THEREFORE, in consideration of the foregoing promises, the covenants

set forth below, and for other good and valuable consideration, the receipt and

sufficiency of which are hereby acknowledged, the parties agree as follows:

 

1.    Definitions.

 

      a. "Character Options" shall mean Character Options Limited with an

address of 86-88 Combe Road, New Malden, Surrey, KT3 4QS, England.

 

      b. "Character Options Toy Series" shall mean PVC articulated toy figures

no less than seven and one-half (7.5) centimeters tall, and associated vehicles

and playsets to the scale of such figures, produced by Character Options, as the

existing range is set forth in Schedule F and any additional figures Character

Options adds to such existing range.

 

      c. "Licensee Letter Agreement" shall mean the letter agreement in the form

set forth in Schedule D.

 

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      d. "MEG IP" shall mean all patents, trademarks, copyrights, and all other

intellectual property rights, and all registrations and applications for any of

the foregoing, anywhere in the world, in and to the MONSTER IN MY POCKET and IN

MY POCKET products, concepts, design, trade dress, storylines, characters,

backgrounds, and/or inventions, including without limitation, the MEG

Trademarks, and all goodwill associated with any of the foregoing.

 

      e. "MEG Trademarks" shall mean the trademarks MONSTER IN MY POCKET and IN

MY POCKET, whether alone or in combination with other words and/or designs, and

all logos, stylizations, slogans, or taglines used or held for use in connection

with the MONSTER IN MY POCKET and IN MY POCKET products, concepts, design, trade

dress, storylines, characters, backgrounds, and/or inventions, and all

registrations, applications, and renewals in connection with any of the

foregoing, owned or licensed by MEG anywhere throughout the world, and all

derivations, combinations, and translations thereof, and all goodwill associated

therewith.

 

      f. "Peak IP" shall mean all patents, trademarks, copyrights, and all other

intellectual property rights, and all registrations and applications for any of

the foregoing, anywhere in the world, in and to the MONSTER QUEST Peak Toy

Series products, concepts, design, trade dress, storylines, characters,

backgrounds, and/or inventions, including without limitation, the Peak

Trademarks, and all goodwill associated with any of the foregoing, exclusive in

all cases of any MEG IP.

 

      g. "Peak Licensees" shall mean each MONSTER IN MY POCKET and Monster Quest

licensee of Peak identified in Schedule C hereto, with addresses as set forth in

Schedule C hereto.

 

      h. "Peak Toy Series" shall mean the concepts, products, designs, and/or

inventions in the toy products described in Schedule A and the television series

developed by Peak and its licensees as described in Schedule B, in each case as

exist as of the Effective Date.

 

      i. "Retail and Premium Markets" shall mean toy figures marketed, sold, or

offered for sale in retail shops, websites, or other venues, or used by any

third party as a free item or added value premium product as part of a

promotional marketing campaign.

 

2.    Acknowledgement.

 

      a. Peak acknowledges and agrees that it has no rights to use, or develop

any products based on, any MEG IP. Without limiting the foregoing, Peak

acknowledges and agrees that it has no right to, and shall not, directly or

indirectly: (i) use the MEG Trademarks, or any trademark or service mark

confusingly similar thereto, (including without limitation, for the avoidance of

doubt, any logo or stylization which is the same as or similar to any logo or

stylization used in connection with the "Monster In My Pocket" or "In My Pocket"

products) in connection with the Peak Toy Series or otherwise, and shall only

use the name "Monster Quest" and logo set forth in Schedule E hereto (together,

the "Peak Trademarks") in connection with the Peak Toy Series; (ii) except with

respect to the Character Options Toy Series (which right shall not be

transferable (whether by assignment, stock sale, asset sale, merger, operation

of law or otherwise) or sublicenseable by Peak or Character Options and shall be

personal to Character Options), develop, promote, manufacture, market, sell, or

offer to sell to Retail and Premium Markets or otherwise whether itself or

through third parties, (A) miniature figures that are less than or equal to

eight (8) centimeters tall, or (B) accessory products scaled to the size of

figures that are less than or equal to eight (8) centimeters tall in connection

with the Peak Toy Series or otherwise provided that, for the avoidance of doubt,

nothing in this Agreement shall be construed to prevent Peak from making

miniature figures for any of its other concepts, e.g., Faireez, Little Big Feet,

Countin' Sheep, Tattoo, The Wumblers and others that clearly have no connection

to MEG IP; and (iii) use or otherwise exploit any MEG IP in connection with any

products (including without limitation any figures, accessory products,

television series, film series, or games) whether in connection with the Peak

Toy Series or otherwise, or otherwise associate the Peak Toy Series with the MEG

IP.

 

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      b. MEG acknowledges and agrees that it has no rights to use, or develop

any products based on, Peak IP.

 

      c. For the avoidance of doubt, nothing in this Agreement shall be

construed as granting Peak or any Peak Licensee any license to use the MEG

Trademarks or exploit any MEG IP.

 

3. Representations, Warranties, and Covenants. Peak represents and warrants and

further covenants as follows:

 

      a. Except for the Peak Licensees, Peak has not granted or purported to

grant any rights relating to the MEG IP to any third parties.

 

      b. As of the Effective Date, Peak has removed all uses of the MEG

Trademarks from its website "www.peakentertainment.co.uk." Within the earlier of

thirty (30) days following the Effective Date or prior to the first time any

product or broadcast included in the Peak Toy Series has been sold or offered

for sale to a customer or potential customer, or otherwise advertised, marketed,

or promoted, Peak will remove all other uses of any MEG Trademarks from its

advertising, promotional materials, and websites, whether for the Peak Toy

Series or otherwise, and will provide evidence of compliance to MEG suitable to

MEG at its sole discretion.

 

      c. Peak agrees that, within 30 days following the Effective Date, it will

deliver to MEG all copies of any material embodying or containing the MEG IP or

bearing any MEG Trademark, including without limitation all CDs, designs,

specifications, and any other materials, and represents that it has retained no

copies of such material, whether digitally or otherwise.

 

      d. Peak has not disclosed to any third party any confidential information

of MEG except pursuant to an enforceable written obligation of confidentiality.

 

      e. As of the Effective Date, Peak has notified the Peak Licensees that

Peak does not own any rights in any toys, characters, storylines, or brands

relating to the MEG IP. Within thirty (30) days of the Effective Date, Peak will

obtain three executed copies of a Licensee Letter Agreement from each Peak

Licensee and will provide to MEG one original executed copy of each Licensee

Letter Agreement for each Peak Licensee.

 

4. Ownership of Proprietary Rights; Notice.

 

      a. Peak acknowledges and agrees that as between Peak and MEG, MEG solely

owns all MEG IP. Peak shall not at any time do or suffer to be done any act

which would impair or diminish MEG's proprietary rights in or to the MEG IP or

interfere with MEG's exercise of any of its rights in the MEG IP. Peak shall not

use or register any trademarks, service marks or business names for use on any

goods or services which trademarks, service marks or business names would be

confusingly similar to any of the MEG Trademarks or MEG IP or to any other

trademark, service mark or business name now in use by MEG on any goods or

services, nor apply for any patents or copyright registrations for any products,

concepts, design, trade dress, storylines, characters, backgrounds, and/or

inventions arising out of, or similar to, the MEG IP, nor use any products,

concepts, design, trade dress, storylines, characters, backgrounds, and/or

inventions that would infringe MEG's rights in the MEG IP. Peak understands that

it has, and acquires, no right, title, or interest in the MEG IP. If MEG wishes

to register the MEG IP or otherwise maintain, preserve, or enforce its rights in

the MEG IP in any jurisdiction, Peak shall cooperate in any such registration or

enforcement action.

 

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5. Infringement. Peak shall promptly notify MEG in writing of any actual or

suspected infringement of the MEG IP by a third party of which it becomes aware

and of any available evidence thereof. Peak shall cooperate with MEG's efforts

to investigate, terminate, and recover damages for any actual or suspected

infringement of the MEG IP.

 

6. Confidentiality. Peak agrees that it shall not disclose any confidential

information contained in the MEG IP to which they previously had access to any

person or entity. The obligations of Peak specified in this Section 6 shall not

apply, and Peak shall have no further obligations, with respect to any

confidential information to the extent that such confidential information is (i)

generally known to the public at the time of disclosure; (ii) becomes generally

known without Peak violating any confidentiality obligations owed to MEG; or

(iii) is disclosed by MEG to a third party without any obligation of

confidentiality. In the event that Peak is requested or required by a

governmental entity (by oral questions, interrogatories, requests for

information or documents, subpoena, civil investigative demand or similar

process) to disclose any of the information subject to Section 6, it is agreed

that Peak will provide MEG with prompt notice of each such request so that MEG<