EXHIBIT 10.58
LICENCE AGREEMENT NUMBER:MTM006
SUMMARY OF TERMS
The Licensee:
Name: Zoo Digital
Publishing Limited
Address: 20 Furnival
Street
Sheffield
S1 4QT
Contact: Andy
Scrivener
tel: 0114 2413700
fax: 0114 241 3701
e-mail:
a.scrivener@zoodigitalpublishing.com
The Property:
Muffin The Mule
The Principal:
Maverick Entertainment Group PLC and SMPL
The Licensor:
Peak Entertainment Ltd
Address: Bagshaw Hall
Bakewell
Derbyshire DE45 1DL
Contact: Paula
Shorrocks
tel:
+44(0)1629 814555
fax:
+44(0)1629 813539
e-mail:
p.shorrocks@peakentertainment.co.uk
The Products:
Interactive DVD game incorporating the Property
Product Package
Any packaged or boxed product that incorporates the
Product
Channels of Distribution: All channels and media of
distribution and promotion
The Territory:
Exclusive Worldwide
The Term:
7 years from first release
Advance Royalty:
(pound)10,000 + VAT on Signature
Guaranteed Royalty:
None other than the above advance
Royalty Rate:
10 % of Net Selling Price
Number of Samples:
20 of each Product
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This LICENCE AGREEMENT is made this day of
2005 between:
THE PARTIES:
1.
PEAK
ENTERTAINMENT LTD, Bagshaw Hall, Bakewell, Derbyshire, DE45 1DL
("the Licensor")
2.
THE LICENSEE: whose full
name and trading or registered address is
referred to on the Summary of Terms Sheet ("the Licensee")
RECITALS
(A)
The Licensor
controls all rights of exploitation in the Property.
(B)
The Licensee
wished to obtain a licence to manufacture, market, sell
and distribute the Products and Product Packages incorporating
the
Property and the Licensor has agreed to grant such right.
1.
DEFINITIONS
"The Intellectual Property" - means copyright, trade mark and
other
rights in the Property.
"Net Selling Price" - means the gross price at which the
Licensee
sells any Product in an arms length transaction less only Value
Added Tax and
normal trade discounts or in the case of any Product
Package the gross price at which the distributor of said
Product
Package sells in an arms length transaction less only Value
Added
Tax and normal trade discounts.
"Notice" - means notice in writing served in accordance with
the
provisions of sub-clause 15.4.
"The Royalties" - means the payments to be made to the Licensor
by
the Licensee under Clause 4.
"The Specifications" - means the specifications set out in the
first
schedule.
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"The Style Guide" - means the documents provided by the Licensor
to
the Licensee from time to time giving details of the Property
including the papers that have been given to the Licensee before
the
signing of this Agreement.
The words referred to in the first column of the Summary of
Terms
shall have the meanings attributed to them in the second column
of
the Summary of Terms Sheet.
2.
GRANT
2.1
In consideration
of the obligations undertaken by the Licensee under
this Agreement the Licensor grants to the Licensee an exclusive
licence to
apply the Property to the manufacture, marketing,
distribution and sale of the Products and Product Packages in
the
Territory in accordance with the Specifications and the Style
Guide
and under the terms of this Agreement in the Territory.
2.2
The Licensee
shall have the right to purchase audio and video
materials of the animated episodes to use in the development of
the
Products and Product Packages.
2.3
The Licensor
reserves all rights not specifically granted herein
including the right to grant licences of the Property to other
licensees in the Territory in respect of other product
categories.
3.
TERM
This Agreement shall be for the Term unless terminated earlier
in
accordance with Clause 9 herein.
4.
ROYALTIES
4.1
In consideration
of the rights granted by the Licensor the Licensee
shall pay to the Licensor the Royalty for each unit of the
Products
and each Product Package unit sold by the Licensee. By way of a
fully recoupable advance of Royalties, the Licensee shall pay
the
Licensor the Advanced Royalty upon signature of this Agreement
by
both parties and receipt of the Licensor's corresponding VAT
invoice.
4.2
The Licensee
shall within 30 days of the 31th March, 30th June, 30th
September and 31th December in each year deliver to the Licensor
a
statement giving particulars of all sales of the Products and
Product Packages effected by the Licensee since the last
statement
date (and in respect of the first statement; since the date of
this
Agreement) and showing the total royalty payable to the Licensor
for
the previous quarter. The form of the statement is set out in
the
second Schedule. On receipt of such a report, the Licensor shall
be
entitled to raise an invoice for the amount of the Royalties due
as
shown in such royalty statement. The amount of the Licensor's
invoice shall be paid by the Licensee within 30 days of its
receipt
by the Licensee.
<PAGE>
4.3
The Licensee
shall keep and maintain detailed accurate accounts and
records so as to show the quantity and Net Selling Price of
Products
and Product Packages sold, used or otherwise disposed of by the
Licensee for each royalty period giving separately the figures
for
each of the Product and/or Product Package. The Licensor shall
have
the right at reasonable hours, and on giving the Licensee
reasonable
notice (which shall not be less than 5 working days), to appoint
a
representative (being a qualified, certified or chartered
accountant) to audit the said accounts and records and if such
audit
reveals a discrepancy it shall be collected forthwith. It is
further
agreed that if such audit reveals an underpayment of 5% or more
of
the amount actually due by the Licensee, the Licensee shall
within
14 days of the date of the relevant invoice pay the Licensor's
reasonable auditing fees and expenses up to a maximum amount of
(pound)2000 in addition to any other payments due and interest
on
the discrepancy at 4% above the base lending rate from time to
time
of National Westminster Bank Plc. In all other cases, the full
costs
of the audit shall be borne by the Licensor.
4.4
All sums payable
by the Licensee to any person pursuant to this
Agreement shall be paid free and clear of all deductions
(except
normal trade discounts) or withholdings whatsoever, save only as
may
be required by any applicable law and save as provided
otherwise
elsewhere in this Agreement.
5.
SPECIFICATION AND QUALITY
5.1
The Licensee
shall manufacture the Products and Product Packages
according to the Specifications and the Style Guide or such
other
specifications as the Licensor may from time to time substitute
with
the prior consent of the Licensee and at all times ensure that
the
Products and Product Packages are of the highest quality
attainable
within the Specifications, in particular the Licensee is to
ensure
that the Products and Product Packages comply in all respects
with
the provisions of the relevant toy safety regulations (where
applicable) and all other relevant statutes, regulations in
respect
of safety and quality.
5.2
The Licensee
shall submit for the Licensor's written approval
samples of the Products, any articles to be sold with the
Products
and all packaging material, display, advertising or publicity
material and shall refrain from distribution, sales or
publication
of
any of the Products until such approval
<PAGE>
shall have been first had and obtained. The Licensor reserves
the
right to require the Licensee to make any alterations that the
Licensor may require to such items. If the Licensor fails to
notify
the Licensee of its disapproval of any materials submitted by
the
Licensee under this Clause 5.2 within 10 calendar days (not
working
days) of receipt of such materials by the Licensor then the
relevant
materials shall be deemed to have been approved by the Licensor
for
the purposes of this Clause 5.2
5.2.1 The Licensee shall comply with this Clause 5.2 at each
and
every stage of development of the Products identified as
follows:
PRODUCT
PACKAGING
Rough visual of concept Rough visual of concept
Hand/Sample/Prototype Rough
artwork
Pre-production sample Finished
artwork
Production sample
Artwork Proof
Finished production packaging
5.2.2 Approval will be granted by the Licensor based on design,
quality and compliance with the Style Guide and the copyright
lines and all designs must be consistent with the identity and
image of the Property.
5.2.3 Approval is not granted on the basis of any safety or
fitness
for purpose aspect of the Products as such aspects are the
sole responsibility of the Licensee.
5.3
The Licensee
shall ensure that all units of the Products including
their wrappings
and packaging are of the same description as the
sample approved by the Licensor in accordance with Clause 5.2.
5.4
The Licensee
shall supply to the Licensor the Number of Samples of
the Products free of charge within three months of the first
production of the Products.
5.5
If the Licensee
employs a third party to manufacture the Products or
any Product Package the Licensee shall:
5.5.1 ensure that the manufacturer is contractually obliged
only
manufactures the Product and/or Product Package for the
Licensee;
5.5.2 ensure that title to any plates or dies manufactured
specially
for production of the Products and/or Product Package are the
property of the Licensee and shall be returned to the Licensee
by the manufacturer on demand; and
<PAGE>
5.5.3 ensure that any Products manufactured meet the
Specifications.
5.6
If the Licensee
or its third party manufacturer require imagery or
artwork additional to the Style Guide, the Licensee agrees to
pay
the price quoted from time to time by the Licensor in respect
thereof.
6.
USE AND
PROTECTION OF INTELLECTUAL PROPERTY
6.1
Every unit of
the Products and all packaging, advertising and point
of sale materials used in connection therewith and which
incorporates the Intellectual Property shall bear the following
statement which shall not be varied in any way by the Licensee
without prior written consent of the Licensor:
"(C) 200- Maverick Entertainment Group plc and SMPL. Licensed
by
Peak
Entertainment Ltd "
6.2
The Licensee
shall not use any of the Property as part of the
Licensee's name or the name of any entity associated with it
without
the prior written consent of the Licensor.
6.3
The Licensee
shall not during the subsistence of this Agreement or
at any time thereafter register or use any of the Intellectual
Property in its own name as proprietor.
6.4
The Licensee
recognises t
