“*************”
DENOTES MATERIAL THAT HAS BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT PURSUANT TO RULE 24b-2 UNDER THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED.
This
license agreement (this “ Agreement ”), which is
effective upon signature by all parties hereto, is by and between
Marvel Characters B.V., with an office at 1600 Rosecrans Avenue,
Manhattan Beach, CA 90266 (“ Marvel ”) and,
solely with respect to characters based on movies and television
shows featuring Spider-Man and produced by Sony Pictures
Entertainment Inc. (“ Spider-Man Movie Characters
”), Spider-Man Merchandising L.P. with an office at 417 Fifth
Avenue, Mezzanine, New York, NY 10016 (the “ LP
” and, together with Marvel, “ Licensor
”), on the one hand, and the party identified below (“
Licensee ”) on the other.
Reference
is made to License Agreement D05184 (as amended to date, “
License Agreement D05184 ”), the Service Agreement
executed on or about January 1, 2006 between Licensee and
Marvel Entertainment, Inc. (as amended to date, the “ 2006
Service Agreement ”), the Fourth Amendment to License
Agreement of even date herewith (the “ Fourth Amendment to
License Agreement D05184 ”), the Third Amendment by
Licensee and Marvel Entertainment, Inc. to the 2006 Service
Agreement of even date herewith (the “ Third Amendment to
2006 Service Agreement ”), and the Service Agreement
between Licensee and Marvel of even date herewith (the “
New Service Agreement ”).
1. BASIC
INFORMATION AND TERMS
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Numbered
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Section
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Attention:
Brian Goldner
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Tel:
401-727-5202
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Fax:
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Email:
bgoldner@hasbro.com
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With a copy to:
Barry Nagler, Esq.
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Tel:
401-727-5008
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Fax:
401-727-5121
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Email:
bnagler@hasbro.com
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All Marvel
Classic Characters . “Classic” Characters refers
to the embodiment of the Marvel characters as originally conceived
in the comic books and widely known to the popular imagination
through successive classic (i.e., faithful in appearance and
characterization to the original comic books) interpretations in
comic books, films, TV animation, video games and other media. The
Classic designation includes all of Marvel’s current classic
(non-media) style guides (and future versions thereof) including,
for example, Classic Spider-Man, Classic X-Men and Classic Hulk as
well as Marvel Retro, Marvel Heroes and Marvel Extreme style
guides, but specifically as well as all Marvel/LP Entertainment
Properties (i.e., media style guides based on films, live-action TV
and/or animation).
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2
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All Marvel
Movie Characters, to the extent the applicable merchandising rights
are owned and/or controlled by Marvel and/or the LP, subject to any
applicable third-party restrictions (for example, restrictions on
likeness rights due to cast talent agreements vis-à-vis
specific Marvel live-action movies). All rights to use Marvel Movie
Characters as they appear in motion pictures, television
productions or productions in other media are subject to agreements
between Marvel or the LP and third parties (including, but not
limited to, talent and studios) relating to such productions;
however, Marvel and the LP shall use commercially reasonable
efforts to obtain from such third parties all rights necessary for
Licensee to fully exploit the rights granted hereunder at no
further expense to Licensee. If Licensee wishes to use any Marvel
Movie Characters other than those characters in Marvel’s
style guide and other than in the form contained in the style
guide, then Licensee shall do so only with Marvel’s prior
written approval, and Licensee shall be responsible for any
required third-party clearances.
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All Marvel
Animated and Live-Action Television Characters, to the extent the
applicable merchandising rights are owned and/or controlled by
Marvel and/or the LP, and subject to any applicable third-party
restrictions (as above). All rights to use Marvel Animated and Live
Action Television Characters as they appear in animation or
television productions are subject to agreements between Marvel or
the LP and third parties (including, but not limited to, talent and
studios) relating to such productions; however, Marvel and the LP
shall use commercially reasonable efforts to obtain from such third
parties all rights necessary for Licensee to fully exploit the
rights granted hereunder at no further expense to Licensee. If
Licensee wishes to use any Marvel Animated and Live Action
Television Characters other than those characters in Marvel’s
style guide and other than in the form contained in the style
guide, then Licensee shall do so only with Marvel’s prior
written approval, and Licensee shall be responsible for any
required third-party clearances.
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Note
#1: Marvel Movie
Characters and Marvel Animated and Live Action Television
Characters are collectively “Marvel/LP Entertainment
Properties”.
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2
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Numbered
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Section
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Note
#2: Properties which are
not incorporated into and are primarily kept separate and apart
from the Marvel Universe are excluded from this Agreement. The
“Marvel Universe” shall mean:
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(i) all characters whose visual
image and description are contained in the Official Handbook of the
Marvel Universe as it may be expanded from time to time, in any
successor reference work, or in any other reference material
identified by Marvel;
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(ii) all characters whose visual
image and description are intended by Marvel to be included in
future editions of the handbook or successor work described in
clause (i) of this sentence;
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(iii) all characters whose first appearance
was in a media production based primarily on any of the characters
described in clause (i) of this sentence; and
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(iv) characters developed by Marvel which,
in one or more of their manifestations, interact with the Marvel
Universe (other than in a wholly insignificant manner, such as an
isolated cameo appearance), whether or not such characters are
included in the Official Handbook .
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(c) Licensed
Categories :
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1. Action Figures
: All toy “action figures” in all sizes in all plastic
(e.g. pvc/abs) or other similar synthetic materials or combination
of materials (but excluding plush and porcelain), with or without
batteries or other electronics, including figures capable of being
assembled, as this category is generally understood within the
boy’s action segment of the toy industry on the date hereof
together with all related accessories (weapons, vehicles, playsets,
etc.) conceived, designed, marketed and sold for interaction with
such action figures (for example, Spider-Man action figures with
Spider-Man motor-cycle designed and built to scale).
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3
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(a)
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Note
#1 : For the avoidance of
doubt, collectible statues, busts, dioramas, sculpts, plastic
models and model kits, Kubricks, Mini-Mates and Bobbleheads, and
Tomy Capsule Collectibles are not included in the Licensed
Categories.
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Note
#2: For the avoidance of
doubt, the following items are not “Action Figures” for
the purposes hereof, and Licensee accepts and understands that
Licensor has on-going licenses in each of these business segments,
which shall continue throughout the Term:
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* * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
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* *
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3
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Numbered
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Section
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2. Flying Action
Figures : defined as any figure (articulated or
non-articulated) that can be, by hand or by air pump, projected,
launched, fired, or propelled through the air or whose primary play
pattern is to take place in mid-air. The Flying Action Figures
shall not be motorized nor electronically powered nor shall they be
tethered, remote, radio and/or infra-red controlled.
Notwithstanding the foregoing, Licensee may use limited radio
control or infra red technology to allow for the in-air separation
of the Action Figure and its attachments (planes).
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3. Articulated Figural
Backpack Clips/Backpack Danglers : Notwithstanding the
foregoing, non-articulated figural backpack clips permanently
attached to a backpack (not sold separately) and sold to the
“back to school” buyer are specifically excluded from
this Licensed Category.
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4. Licensee’s
Proprietary “Attacktix” Branded Figure Tactics
Game : defined as the existing Hasbro figure-based strategy
and tactics tabletop game of this name, as well as substantially
similar variations and extensions thereof.
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5. Non-Costume/Non-Dress
Up Action and Role-Play Weapons and Accessories :
pretend-play wearable accessories, which embody and/or emulate key
powers and/or re-produce key accessories of Marvel Super Heroes.
This Licensed Category does not include prop replicas.
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Note
#3: By way of example,
this Licensed Category would include Spider-Man Web Blasters, other
blasters and weapons, and role play laser tag, Hulk Hands, helmets,
masks, and Wolverine Claws. Other examples could include, for
instance, a Thor hammer or Captain America shield (re-produce key
accessories).
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Note
#4: All
Non-Costume/Non-Dress Up Action and Role-Play Articles must be
composed of not less than fifty percent (50%) plastic.
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Note
#5: For the avoidance of
doubt, this Licensed Category does not cover all weapons (e.g.
non-role plays laser tag), non-action Role Play, Video Game
Accessories, Peripherals, and Controllers; provided that Licensor
shall consider in good faith Licensee’s request to produce
role play products which have a secondary feature which would allow
a video game accessory or controller to be incorporated into such
product.
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6. Feature Plush (Figural
or Non-Figural) : in all styles/types, sizes and materials.
Feature Plush is defined as Plush with animatronics, electronic or
mechanical interactive features or attributes (i.e. lights, sounds
and/or movement). Notwithstanding the foregoing, basic plush with
simple features that do not incorporate any form of electronics,
battery power or motion of any kind are specifically excluded from
this Licensed Category #6 and are included in Licensed Category #7
below.
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4
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Numbered
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7. Basic Plush (Figural or
Non-Figural) ( NON-EXCLUSIVE) : in all styles/types,
sizes, materials, and may include simple features that do not
incorporate any form of electronics, battery power or motion of any
kind.
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8. Figural Wall-Crawling
Radio or Infrared Control : in all styles/types, sizes and
materials.
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9. Co-Branded Transformers
Brand Action Figures : defined as a co-branded program
limited to Licensed Article #1 (Action Figures) combining the
Characters and the images, copyrights, and marks of Hasbro’s
Transformers brand.
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10.
***********************************and accessories .
Licensee shall not utilize the Marvel brand to
****************************************************
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11. Licensee’s Proprietary Foam
Based “Nerf” Branded Sporting Goods and Blasters that
shoot foam darts and balls : all styles/types. The category of foam based
sporting goods shall be non-exclusive and the category of blasters
that shoot foam darts and balls shall be exclusive.
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12. Water Guns, Water Blasters
and Water Cannons .
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13. Board Games :
children’s, family and all-age board games in
Licensee’s proprietary brands (for example,
“Monopoly”, “Life”, “Risk”,
“Candy Land”, “Operation”, “Trivial
Pursuit”, “Clue”, “Scrabble”,
“Heroscape”), in themed editions, as well as
non-proprietary-branded children’s, family and all-age board
games. Notwithstanding the exclusive nature of this Licensed
Category, Licensee agrees to consider in good faith on a
case-by-case basis Licensor’s requests to license out
non-competitive age and/or gender specific executions.
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14. Electronic Hand Held
Electronic Games : self-contained dedicated electronic
handheld devices with their corresponding software hard-coded into
such device (which shall be similar to Tiger Electronic dedicated
electronic handheld devices). Such device shall not accept
cartridges or any additional software and/or shall not connect to a
computer, television, pc or any other interactive device nor
include any educational, teaching, or learning elements.
Notwithstanding the exclusive nature of this Licensed Category,
Licensee agrees to consider in good faith on a case-by-case basis
Licensor’s requests to license out non-competitive age and/or
gender specific executions.
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15. Puzzles :
two-dimensional (2D) cardboard and foam puzzles in all shapes,
piece counts and sizes and cardboard and foam three-dimensional
(3D) puzzles (i.e. Wrebbit, Puzz3D). Notwithstanding the exclusive
nature of this Licensed Category, Licensee agrees to consider in
good faith on a case-by-case basis Licensor’s requests to
license out to third parties non-competitive age and/or gender
specific executions.
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5
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Numbered
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Section
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16. Licensee’s Proprietary
“Puzzle Shots” : defined as the application of
a digital photograph on to a digital puzzle and/or poster. The
picture puzzle and/or poster shall be distributed through on-site
portrait studio (kiosk) where a consumer’s digital
photograph is taken and super-imposed on a Character background to
create a personalized foam fit puzzle. Licensor agrees to consider
in good faith Licensee’s request to exploit Puzzle Shots
through on-line executions.
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17. Licensee’s Proprietary
“Playskool” Branded Pre-School Toys : This
category shall include Licensee’s range of products of the
general type developed by Licensee under License Agreement D06053.
Actual styles/types of products shall be developed in consultation
with Licensor with Licensor retaining final approval over the
styles and types of products to be developed, such approval not to
be unreasonably withheld. The category of pre-school toys shall be
non-exclusive.
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18. All Compounds : including,
but not limited to Play-Doh.
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19. Electronic IPOD/MP3
Speakers : limited to a dog or figure which interacts with
an Ipod or MP3 player and displays motion, sound and light in
reaction and relation to music in the manner consistent with
Licensee’s I-DOG line of products. Additional
styles/types (e.g. fish, and cats) to be approved on a case-by-case
basis in Licensor’s sole written discretion, which approval
shall not be unreasonably withheld.
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20. Musical Toothbrushes :
defined as a toothbrush that plays music.
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21. Wall Decals : permanent and
removable wall decals. Specifically to exclude wall paper and wall
paper borders. Notwithstanding the exclusive nature of this
Licensed Category, Licensor shall have the right to sell Wall
Decals limited to the home décor buyer of retail customers
and further the Wall Decals sold by Licensor may not be sold in the
toy or poster section of any retailer, and Licensee agrees to
consider in good faith on a case-by-case basis Licensor’s
requests to license out non-competitive executions.
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22. Licensee’s Proprietary
“Lite Brite” Branded Activity Products :
limited to the following styles types:
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a. “Lite Brite”
Activity Set: defined as an activity set whereby the consumer
uses child friendly pegs which are pushed through perforated
paper/panel and paper to create designs.
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b. Spinning Paint Activity
Sets: defined as a spinning mechanism with paint and sheets of
paper or other material to create designs on the sheets of paper.
The Spinning Paint Activity Sets may also include lights and
sounds.
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6
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Numbered
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Section
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23. Licensee’s Proprietary
“Titanium” Branded Die-Cast Figures and Vehicles
) : the existing
Hasbro die-cast toy line of this name, as well as substantially
similar variations and extensions thereof which maintain the
existing distinctive chrome/metallic finish (painted or
non-painted). The category of die-cast shall be
non-exclusive.
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Note
#6: QSR premiums —
Licensee acknowledges and understands that Licensor generally does
not control promotional rights to Marvel/LP Entertainment
Properties and therefore to third-party promotional/tie-in
activities and the associated premiums which may accompany or be a
part of such promotional activities. With respect to
quick-service-restaurant (“QSR”) promotions, Licensor
shall use commercially reasonable and good-faith efforts to consult
with Licensee on the premiums considered for use in Marvel/LP
Entertainment Properties QSR promotions and attempt to influence
the choice of such premiums to non-action-figure-type
executions.
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7
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Numbered
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Section
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(i) Territory :
Worldwide, excluding Japan
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3(b)
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(d) Territory/ Channels of
Distribution:
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Note
#1 : Notwithstanding the
foregoing, Licensed Article #9 (Co-Branded Transformers Brand
Action Figures) may be sold in Japan and Licensee may distribute
any Licensed Article in Japan through an authorized licensee or
distributor approved by or designated by Licensor.
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(ii) Channels of
Distribution : All Channels of Distribution.
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1. Internet: may only be sold
or shipped within the territory specified in Section 1(d)
(i)
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2. Home Shopping: Subject to
Section 13(a)
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3. Direct Sales method,
including Internet direct sales: may only be sold or shipped within
the Territory specified in Section 1(d)(i)
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Note
#2 : Licensed Articles in
Licensed Category #6 (Feature Plush) and #7 (Basic Plush) are
excluded from the following Channels of
Distribution:
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• Charity/Fundraising,
unless approved by Licensor, which approval shall not be
unreasonably withheld.
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Note
#3 : Notwithstanding
anything to the contrary, and despite the restrictions in
Section 1(f) and 3(a), Licensor may itself utilize or grant to
any other party the right to sell, distribute or otherwise exploit
the Property in connection with Licensed Category #6 (Feature
Plush) in the following Channels of Distribution:
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• Gift (e.g., Spencer
Gift, Hallmark Gold Crown Stores and Hot Topic etc.)
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• Specialty (e.g., FAO
Schwartz and Build a Bear, etc.);
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• Upstairs Department
Stores (e.g., Macys, Nordstrom’s and Bloomingdales,
etc.).
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8
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Numbered
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Section
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3
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(c)
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a) If the fourth Spider-Man
film is released by December 31, 2011, then the Commencement
Date for this Agreement shall be January 1, 2012 for all
Characters other than the fourth Spider-Man film (if released in
2011) and any other Qualifying Theatrical Releases or Domestic
Qualifying Broadcasts which are released during 2011 (each, a
“2011 Release” and collectively, the “2011
Releases”). Each 2011 Release shall remain apart and separate
from this Agreement until the day which is twelve (12) months
after the United States release date of such 2011 Release (for each
2011 Release, the “2011 Release Term”). For the
avoidance of doubt, until expiration of the 2011 Release Term (on a
film by film or animated television show by animated television
show basis), all terms of Licensee Agreement D05184 shall apply to
each 2011 Release * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * *, and shall not
cross-collateralize or credit any such royalties against the
Minimum Royalty Guarantee for this Agreement D09001. Upon
expiration of the 2011 Release Term for each 2011 Release, the
terms of this Agreement D09001 * * * * * * * * * * * * * * * * * *
* * * * * * * shall apply to all subsequent sales of tie-in
Licensed Articles for each 2011 Release.
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b) If the fourth Spider-Man
film is not released by December 31, 2011, then the
Commencement Date for this Agreement shall be January 1, 2013
for all Characters other than the fourth Spider-Man film (if
released in 2012) and any other Qualifying Theatrical Releases or
Domestic Qualifying Broadcasts which are released during 2012
(each, a “2012 Release” and collectively, the
“2012 Releases”). Each 2012 Release shall remain apart
and separate from this Agreement until the day which is twelve
(12) months after the United States release date of such 2012
Release (for each 2012 Release, the “2012 Release
Term”). For the avoidance of doubt, until expiration of the
2012 Release Term (on a film by film or animated television show by
animated television show basis), all the terms of Licensee
Agreement D05184 shall apply to each 2012 Release * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* *, and shall not cross-collateralize or credit any royalties
against the Minimum Royalty Guarantee for this Agreement D09001.
Upon expiration of the 2012 Release Term for each 2012 Release, the
terms of this Agreement D09001 * * * * * * * * * * * * * * * * * *
* * * * * * shall apply to all subsequent sales of tie-in Licensed
Articles for each 2012 Release.
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* * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * *
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9
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Numbered
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Section
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December 31, 2017 (subject to extension as
set forth in Section 3(c) hereof). Notwithstanding anything to
the contrary contained in this Agreement, no manufacture, sale or
distribution of articles utilizing the Property in Licensee’s
exclusive Licensed Categories by parties other than Licensee prior
to the Expiration Date (as it may be extended) shall violate this
Agreement as long as such activity is with respect to retail sales
occurring after the Expiration Date (as it may be extended) and,
more particularly, is conducted according to the following
schedule:
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(i) sales (wholesale) to be
made no earlier than six (6) months before the Expiration Date
(as it may be extended);
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(ii) manufacturing to be performed no
earlier than six (6) months before the Expiration Date (as it
may be extended); and
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(iii) shipment to begin no earlier than two
(2) months before the Expiration Date (as it may be
extended);
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but where one
of the parties informs the other that variations from the dates in
clauses (i) through (iii) of this sentence would be
reasonable under the circumstances, the parties shall negotiate in
good faith on the subject of whether the requested variation should
be made.
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If the
Commencement Date becomes January 1, 2013 as described in
Section 1(e)(b), the Expiration Date shall become
December 31, 2018, subject to extension as set forth in
Section 3(c) hereof.
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(f)
Exclusive/Non-Exclusive:
|
|
Except for the
exceptions specifically set forth in the Licensed Category
descriptions in Section 1(c) and Section 1(d)(ii) and
Section 14, the license granted to Licensee under this
Agreement shall be exclusive and so long as Licensee is not in
material and uncured default under this Agreement, Licensor shall
not, during the Term as it may be extended and in the Territory,
grant to any third party, nor shall it or any of its affiliates
utilize, the right to sell, distribute or otherwise exploit the
Property (to the extent that the Property continues to be licensed
hereunder) in any Licensed Categories in the Channels of
Distribution.
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3(a)
|
|
10
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Numbered
|
|
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|
Section
|
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|
Note
#1 : For all sales by
Licensee directly to consumers, including any sales through
Licensee-owned retail stores (web-based or traditional), each of
the following Royalty Rates shall be reduced by ********** (e.g.,
******* becomes ************) and “Net Sales” shall
mean the invoiced consumer retail price.
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|
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5(a)
|
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A. For sales by
Licensee (or its Affiliates, as defined in Section 5(a)(i)) to
parties other than *****************************, and credited
against advance/guarantee payments made hereunder:
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* * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * *
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* * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * *
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* * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * *
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* * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * *
|
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11
|
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|
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|
Numbered
|
|
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|
Section
|
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|
|
B. For sales by
Licensee (or its Affiliates) to * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * *, and credited
against advance/guarantee payments made hereunder:
|
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* * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* *
|
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(h) Minimum Royalty
Guarantee :
|
|
One Hundred
Million Dollars (U.S. $100,000,000) plus the amount of any
Performance Advances payable in accordance with this
Section 1(h). In no event shall the Minimum Royalty Guarantee
exceed Two Hundred Forty Million Dollars (U.S.
$240,000,000).
|
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5(b)
|
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|
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|
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|
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Fifty Million
Dollars (U.S. $50,000,000) payable within five (5) business
days after full execution of this Amendment.
|
|
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|
|
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|
|
|
|
|
|
|
|
|
|
Fifty Million
Dollars (U.S. $50,000,000) payable on the date that is the last day
of the calendar month in which the final 2011 Release Term or 2012
Release Term (whichever is applicable) expires, but in no event
later than December 31, 2013.
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12
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Numbered
|
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Section
|
|
|
|
Note
#1 : All sums payable as
Advances and Balances, including all Advances, Performance Advances
and Balance of Minimum Royalty Guarantee are recoupable * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
against any royalty payments due hereunder, whether accruing before
or after the date of payment, and all are cross collateralized
against one another.
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Note
#2 :
“Qualifying Theatrical
Release” shall mean * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * *
|
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|
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“Qualifying Marvel Release” shall be
defined as a Qualifying Theatrical Release produced by Marvel
Studios.
|
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“Initial
Run” shall mean * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * *.
|
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(A)
Performance Advances : “Performance Advances”
shall mean Mega Property Qualifying Theatrical Release Advances and
Qualifying Marvel Release Advances.
|
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(i) Mega
Property Qualifying Theatrical Release Advances :
|
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|
|
Subject to
Clause B below, Licensee shall pay an advance of Thirty Million
Dollars (U.S. $30,000,000) within five (5) business days after
the United States Release Date of each of up to four (4) Mega
Property Qualifying Theatrical Releases which are released during
the Term, and Twenty Million Dollars (U.S. $20,000,000) within five
(5) business days after the United States Release Date of a
fifth Mega Property Qualifying Theatrical Release if no Qualifying
Marvel Release Advances have been paid as of the United States
Release Date for such fifth Mega Property Qualifying Theatrical
Release. For purposes of clarity, in no event will the cumulative
total of Mega Property Qualifying Theatrical Release Advances and
Qualifying Marvel Release Advances exceed One Hundred Forty Million
Dollars (U.S. $140,000,000). “Mega Property Qualifying
Theatrical Release” shall be defined as a Qualifying
Theatrical Release * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * that is primarily focused upon one of the
following properties:
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|
* * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * *
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13
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Numbered
|
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Section
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|
As used in this
Section 1(h), “primarily focused” shall mean that
the film uses the applicable property name in its title and
primarily focuses on the property’s character.
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|
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(ii)
Qualifying Marvel Release Advances : Subject to Clause B
below, Licensee shall pay an advance of Ten Million Dollars (U.S.
$10,000,000) for each Qualifying Marvel Release within five
(5) business days after receipt of notice to Licensee from
Licensor that such release * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * *, provided that
in no event shall the cumulative total amounts paid as Qualifying
Marvel Release Advances and Mega Property Qualifying Theatrical
Advances exceed One Hundred Forty Million Dollars (U.S.
$140,000,000).
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(B) Final
Potential Guarantee . The “Final Potential
Guarantee” shall be defined as One Hundred Million United
States Dollars (U.S. $100,000,000) plus any earned Performance
Advances (e.g., the cumulative total amounts paid as Qualifying
Marvel Release Advances and Mega Property Qualifying Theatrical
Release Advances) up to One Hundred Forty Million Dollars (U.S.
$140,000,000) for a total of up to Two Hundred Forty Million
Dollars (U.S. $240,000,000). Under no circumstances shall the Final
Potential Guarantee exceed Two Hundred Forty Million Dollars (U.S.
$240,000,000). Mega Property Qualifying Theatrical Release Advances
and Qualifying Marvel Release Advances shall be due and payable, as
earned, regardless of the amount of royalties previously paid by
Licensee, * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * *
|
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(C) For
calculation of the gross box office revenues referenced herein, the
parties shall use the box office statistics for the Initial Run
only of the applicable film which are published in the
entertainment industry trade magazine/e-zine/newspaper
Variety or other such reasonable replacement in the event
Variety is no longer in publication.
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14
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Numbered
|
|
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|
|
|
Section
|
|
|
|
(D) Except as
specifically provided herein, no royalties or fees generated under
other agreements may cross-collateralize against this License
Agreement D09001.
|
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|
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|
|
* * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* *
|
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|
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|
|
|
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|
|
* * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* *
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|
|
|
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|
|
Combined Single
Limit of $3,000,000 per occurrence.
|
|
|
10(e)
|
|
|
|
|
|
|
|
|
|
(j) Post-Expiration
Disposal Period :
|
|
90
Days
|
|
|
16(e)
|
|
(a) Marvel
and the LP represent and warrant, to the best of their knowledge
with respect to trademark and servicemark rights (including, but
not limited to, trade dress and goodwill pertaining to such marks),
and without limitation with respect to all other of the following
items and rights, that they have all rights in and to the names,
nicknames, abbreviated names, depictions, likenesses, poses,
costumes, emblems, powers, characteristic concepts, themes,
settings, pictorial and written graphics and other characteristic
elements and contexts of the Characters identified in Section 1(b)
hereof and any copyrights, trademarks, service marks and other
intellectual, literary, artistic, design, moral, industrial or
commercial property rights and goodwill in connection with the
Characters, incidents, language, artwork, symbols, designs,
depictions, likenesses, formats, poses, concepts, themes and
graphic, photographic and other visual representations of, relating
to and associated with the Characters identified in Section 1(b)
hereof (which names, characters, etc. and/or each of the individual
components thereof shall hereinafter be referred to as the “
Property ”), said Property being known and recognized
by the general public and associated in the public mind with
Marvel.
15
(b) Licensee
desires to utilize the Property in the manner hereinafter
described.
(c) Marvel
is a wholly owned subsidiary of Marvel Entertainment, Inc.
(formerly known as Marvel Enterprises, Inc.), a Delaware
corporation.
(d) Marvel
is a general partner of the LP.
(e) Under
a separate service agreement dated as of the date hereof (the
“ New Service Agreement ”), Marvel has agreed to
provide Licensee with creative consultation with respect to the
creation, appearance, packaging and marketing of Licensed Articles
in exchange for a service fee * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * *
(a)
Licensed Articles . Upon the terms and conditions and with
the limitations and exceptions set forth in this Agreement,
Licensor hereby grants to Licensee and Licensee hereby accepts the
exclusive (except for the exceptions specifically set forth in the
Licensed Category descriptions in Section 1(c) and
Section 1(d)(ii) above and Section 14 below) license and
right to utilize the Property but solely upon and in connection
with the manufacture, promotion, sale, and distribution of the
categories of articles identified in Section 1(c) (“
Licensed Categories ”) and in the Channels of
Distribution identified in Section 1(d) (ii) (“ Channels
of Distribution ”) during the Term. Articles in the
Licensed Categories that utilize the Property and are manufactured,
promoted, sold and/or distributed hereunder are referred to herein
as “ Licensed Articles ”.
(b)
Territory/Channels of Distribution . The license hereby
granted extends only to the Territory identified in
Section 1(d)(i) and within the Channels of Distribution
identified in Section 1(d)(ii). Licensee expressly
acknowledges and agrees that it is not licensed or authorized to
use the Property, directly or indirectly, in any other area or
Channel of Distribution, and that it is not licensed to and will
not knowingly sell the Licensed Articles to persons who intend or
are likely to resell them in any other area or Channel of
Distribution, to the extent this provision is permitted by the
applicable law at the time of such use, license or sale. In the
event that Licensee sells or exploits the Licensed Articles outside
either the Territory or Channels of Distribution in violation of
this Section 3(b), notwithstanding Sections 1(g) and 5(a), the
royalty due Licensor on such sales shall be the Net
Sales.
(c)
Term . The license hereby granted shall commence upon the
Commencement Date and terminate automatically on the Expiration
Date (the “ Term ”) set forth in Section 1(e) or
the expiration of any renewal or extension as provided herein,
unless sooner terminated in accordance with the provisions hereof.
In the event Licensee commences any activities in connection with
the Property prior to the Commencement Date, all provisions of this
Agreement for the benefit and protection of Licensor and Licensee
shall apply in full to such activities. Marvel and Licensee shall
use commercially reasonable efforts to realize a smooth commercial
transition from Marvel’s current master toy licensee to the
Licensee and, at the end of the Term, from the Licensee to Licensor
itself or to a successor licensee, with regard to maintaining
merchandise space at key retailers, developing new lines in a
timely manner and maintaining appropriate stock and inventory
levels during the transition.
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(i) If,
during the Term, Marvel and its licensees do not release a minimum
of eight (8) Qualifying Theatrical Releases (as defined herein),
including a minimum of four (4) Mega Property Qualifying
Theatrical Releases (as defined herein) (the aggregate release of
all of such films being referred to as the “Marvel
Entertainment Commitment”) between the commencement of the
Term and December 31, 2017 (or December 31, 2018, in the
event that the Commencement Date is January 1, 2013) then the
Term of this Agreement shall be extended by one year (i.e., until
December 31, 2018 or December 31, 2019, as the case may
be).
(ii) Notwithstanding
anything to the contrary above, if Marvel and its licensees release
one or more Qualifying Theatrical Releases during the final
calendar year of the Term, as it may be extended (“Term Final
Year Releases”), Licensee’s rights with respect to any
Term Final Year Releases shall extend until the end of the calendar
month that is twelve (12) months after the United States
release date of such Term Final Year Release.
(d) Eighteen
(18) months prior to expiration of the Term Marvel shall
submit in writing its schedule of films and television series based
on its best knowledge at such time for a prospective renewal term.
Licensee shall have a Right of First Negotiation (as defined below)
for the rights granted hereunder after the expiration of the Term
hereof unless Marvel elects to exploit the rights directly itself.
“ Right of First Negotiation ” shall mean the
following: prior to beginning negotiations with a third party
regarding the rights granted herein, Marvel shall give written
notice to Licensee and for seventy five (75) days from the
mailing of the notice (the “ Negotiation Period
”), Marvel and Licensee shall negotiate in good faith. If
Marvel and Licensee have not executed a binding agreement by
expiration of the Negotiation Period, Licensor shall be free to
grant any and all rights to any third party.
(a) Licensor
hereby reserves all rights not herein specifically granted to
Licensee.
(b)
Television, etc. Except only for the visual reproduction or
presentation of the actual Licensed Articles licensed hereunder or
of the actual packaging therefor or as may be expressly provided in
this Agreement, Licensee shall not use the Property or the Licensed
Articles identified with the Property in connection with any manner
of television, radio, motion picture, filmstrip, webcast, Internet
broadcast, sound and/or visual recording or transmission device or
media, or anything similar to the foregoing now known or hereafter
developed without Marvel’s prior written approval. The name
and/or likeness of any performer portraying any character included
within the Property on radio, television, or in any other media or
form shall not be deemed to be included in the Property, and the
use thereof is not licensed.
5.
ROYALTIES, PAYMENTS, REPORTS, RECORDS AND BRAND
INTEGRITY
(a)
Royalties . Licensee agrees to pay Licensor royalties at the
Royalty Rate identified in Section 1(g), determined as
follows:
(i) Royalties
shall be calculated by applying the Royalty Rate identified in
Section 1(g) to Licensee’s (or its Affiliates’) Net
Sales (defined below). “ Affiliate ” means, with
respect to any party, any other party directly or indirectly
controlling or that is controlled by or is under common control
with such party. For the purposes of this definition,
“control” means the possession of the power to direct
or cause the direction of the management and policies of such
Person, whether through the ownership of voting securities, by
contract or otherwise. “Affiliated” and
“Unaffiliated” shall have corresponding
meanings.
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(iii) Royalties
as specified herein shall become due on the last day of each of
Hasbro’s quarterly fiscal periods, and shall be paid not
later than thirty (30) days following the end of the Hasbro
fiscal period for all Net Sales accruing for the United States,
Canada and their respective territories and possessions in that
Hasbro fiscal period and not later than sixty (60) days following
the end of the Hasbro fiscal period for all Net Sales accruing in
the remainder of the Territory in that Hasbro fiscal period,
accompanied by the Royalty Report required herein. Royalties are
due on any and all sales or other disposition of the Products.
Products shall be considered sold and Net Sales shall be deemed
accrued for all purposes hereunder on the date of shipment or the
date that the shipment is invoiced by the Licensee, whichever date
is earlier. Hasbro’s fiscal year ends on a Sunday within two
weeks of the end of each calendar year, and Hasbro’s
quarterly fiscal periods typically consist of thirteen
(13) weeks each, ending on a Sunday.
(iv) Licensee’s
(and its Affiliates’) sales and pricing policies shall
reasonably optimize maximum availability of the Licensed Articles
in the Territory and Channels of Distribution while avoiding deep
discounts, liquidation, close-outs, over-production, “market
flooding” or other disparaging pricing and related production
practises which would reasonably constitute “dumping”
as the term is generally understood in the consumer products
industry, unless specifically agreed to in advance and in writing
by Licensor. * * * * * * * * * * * * * * * * * * * * * * * * * *
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