TRADEMARK LICENSE AGREEMENTTrademark License Agreement |
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Exhibit 10.33
TRADEMARK LICENSE AGREEMENT
THIS AGREEMENT is entered into on this 1st day of July, 1995 between THE DIAL CORP (“Dial”), a Delaware corporation, with its principal offices at 1850 North Central Avenue, Phoenix, Arizona, and CONAGRA, INC. (“ConAgra”), a Delaware corporation, with its principal offices at One ConAgra Drive, Omaha, Nebraska.
WITNESSETH
WHEREAS, ConAgra entered into a licensing agreement with Armour-Dial, Inc., Dial’s predecessor-in-interest, on or about December 18, 1983 (“1983 LICENSING AGREEMENT”); and
WHEREAS, in that 1983 LICENSING AGREEMENT, ConAgra granted Dial limited rights to use the trademarks ARMOUR, STAR, ARMOUR STAR, ARMOUR’S, ARMOUR (Logo type design), and BANNER on certain shelf-stable products specified in Exhibit B to the 1983 LICENSING AGREEMENT; and
WHEREAS, ConAgra filed suit against Dial for breach of contract and trademark infringement, Case No. 8:CV 93-00339 in the United States District Spurt for the District of Nebraska which suit was dismissed without preiudice in contemplation of execution of this AGREEMENT; and
WHEREAS the parties desire to enter into this Agreement to set forth their rights and obligations with respect to the TRADEMARKS (as hereinafter defined), cancelling and superseding the 1983 LICENSE AGREEMENT.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements hereinafter contained, it is agreed as follows:
DEFINITIONS
a. NET SALES : In this Agreement, the term NET SALES shall mean the number obtained by subtracting cash discounts and product returns and allowances (excluding trade allowances) from Dial’s gross sales of SHELF-STABLE PRODUCTS (as hereinafter defined).
b. ROYALTY : In this Agreement, the term ROYALTY shall refer to the amount owed to ConAgra by Dial, as calculated according to Section 2 below.
c. SHELF-STABLE PRODUCTS :
(i) Subject to the provisions hereinbelow, in this Agreement, the term “SHELF-STABLE PRODUCTS” shall mean any and all food products sold under or in connection with the TRADEMARKS which under normal conditions do not need to be refrigerated, cooled, or frozen while being transported, inventoried, warehoused, stored, distributed and/or sold.
(ii) The term SHELF-STABLE PRODUCTS shall not include any of the food products sold under or in connection with the TRADEMARKS as of the date of this Agreement that need to be refrigerated, cooled, or frozen to be transported, inventoried, warehoused, stored, distributed and/or sold (a list of all such products is set forth in Schedule C.1 hereto and includes a product description for each complete with the respective SKU or UPC for each) regardless of whether future technological developments make it possible to transport, inventory, warehouse, store, distribute and/or sell these products without being refrigerated, cooled, or frozen.
(iii) The term SHELF-STABLE PRODUCTS shall also exclude products commonly referred to as “Fresh”, such as fruit and vegetables.
(iv) The term SHELF-STABLE PRODUCTS includes all processed meat products which fall within Paragraph c.(i) above excepting, however, the particular dry sausage products sold by ConAgra or its affiliates under or in connection with the TRADEMARKS as of the date of this Agreement (a list of all such products is set forth in Schedule C.2 hereto and includes a product description for each complete with the respective SKU or UPC for each). The parties understand and agree that the dry sausage products set forth in Schedule C.2 are not licensed to Dial, but that all other processed meat products which fit the definition of SHELF-STABLE PRODUCTS herein (for example meat sticks and jerky snacks) are licensed hereunder to Dial.
d. TERRITORY : In this Agreement, the term TERRITORY shall refer to the United States of America.
e. TRADEMARKS : In this Agreement, the term TRADEMARKS shall mean the trademarks and/or trade names ARMOUR, STAR, ARMOUR STAR, ARMOUR’S, ARMOUR (logotype design), and BANNER. The term TRADEMARKS shall also include trademarks incorporating any of the foregoing ( e.g. , ARMOUR FARMS and CAPTAIN ARMOUR) but only if ConAgra, in the exercise of its discretion, specifically approves of those new trademarks in writing.
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GRANT OF LICENSE
Upon the terms and conditions hereinafter set forth, ConAgra hereby grants to Dial and Dial hereby accepts from ConAgra the sole and exclusive right to use, in any lawful manner whatsoever, the TRADEMARKS but solely in connection with the SHELF-STABLE PRODUCTS in the TERRITORY.
The parties agree and understand that, except as provided in this Agreement, ConAgra reserves all rights with respect to the TRADEMARKS not expressly granted herein including but not limited to the exclusive right to utilize and/or license the TRADEMARKS in connection with the manufacture and/or sale of any product that is not a SHELF-STABLE PRODUCT.
Nothing herein shall be construed as granting to Dial any right to use the TRADEMARKS for restaurant services. The foregoing shall not be construed to limit in any manner, Dial’s channels of distribution of SHELF-STABLE PRODUCTS.
ROYALTIES
In consideration of the rights granted herein to Dial, Dial shall pay to ConAgra the following suits as ROYALTY:
(a) The sum of five hundred thousand dollars ($500,000.00) which shall be payable as follows: (i) one hundred twenty-five thousand dollars ($125,000.00) upon the execution of this Agreement and (ii) fifteen (15) equal quarterly installments of twenty-five thousand dollars ($25,000.00) each, payable as follows: July 1, 1995; October 1, 1995; January 1, 1996; April 1, 1996; July 1, 1996; October 1, 1996; January 1, 1997; April 1, 1997; July 1, 1997; October 1, 1997; and January 1, 1998; April 1, 1998; July 1, 1998; October 1, 1998; January 1, 1999.
(b) In addition to the amounts to be paid under Paragraph 2(a) above, during the period commencing effective January 1, 1995 through December 31, 1998, Dial shall pay to ConAgra a percentage royalty based upon annual NET SALES of SHELF-STABLE PRODUCTS sold as follows:
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For Annual NET SALES of SHELF-STABLE PRODUCTS of: |
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The Percentage of Annual NET SALES is: |
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0 - $200,000,000 |
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0% |
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$200,000,001 - $300,000,000 |
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.5% |
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$300,000,001 - $500,000,000 |
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1% |
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Over $500,000,001 |
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1.5% |
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For example, if, for the period ending December 31, 1996, Dial’s annual NET SALES are $275,000,000, Dial’s percentage royalty under Section 2(b) would be $375,000. Another example would be if Dial’s annual NET SALES are $325,000,000, Dial’s percentage royalty under Section 2(b) would be $750,000.
(c) In addition to the amounts to be paid under Paragraph 2(a) above, for all calendar year periods from and after January 1, 1999, during the term of this Agreement, Dial shall pay to ConAgra the greater of (i) two hundred fifty thousand dollars ($250,000.00) annually; or a percentage royalty based upon annual NET SALES of SHELF-STABLE PRODUCTS as follows:
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For Annual NET SALES of SHELF-STABLE PRODUCTS of: |
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The Percentage of Annual NET SALES is: |
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0 - $200,000,000 |
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0% |
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$200,000,001 - $300,000,000 |
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.7% |
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Over $300,000,001 |
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1.25% |
In no event shall annual royalties under Section 2(c) exceed two million dollars ($2,000,000).
(d) All sums due pursuant to Paragraphs 2(b) and (c) above shall be paid on or before May 1 of each year for the previous calendar year. Along with said payment, Dial shall provide ConAgra with a final statement, certified as complete and accurate, of annual NET SALES with respect to the prior calendar year.
3. ASSIGNMENT
(a) Except as otherwise provided herein, and so long as ConAgra does nothing to conflict with or restrict the licensed rights granted to Dial herein, ConAgra may sell, assign, license, encumber or otherwise transfer (“Assign” or “Assignment”) this Agreement and the TRADEMARKS without restriction, provided that, with respect to an Assignment of this Agreement, the assignee assumes, in writing, the terms and conditions of this Agreement and all duties and obligations of the licensor hereunder.
(1) Dial shall have a right of first refusal to purchase the rights to the TRADEMARKS and associated goodwill if, and only if, ConAgra is assigning the rights to only the TRADEMARKS and associated goodwill, and the assignment is not part of a merger, sale, or other transaction in which assets other than the TRADEMARKS and associated goodwill are also being transferred. Prior to assigning the TRADEMARKS and associated goodwill (if ConAgra is only assigning the TRADEMARKS and
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associated goodwill and no other assets as noted above), ConAgra will first offer to sell the TRADEMARKS and associated goodwill to Dial upon the same terms and conditions as ConAgra had proposed with the third party. Dial will have twenty (20) days from its receipt of the written offer to accept such offer. If Dial does not accept such offer, ConAgra may thereafter assign the TRADEMARKS and associated goodwill to the third party.
(2) Dial shall not have a right of first refusal to purchase the rights to the TRADEMARKS and associated goodwill if ConAgra is assigning the rights to the TRADEMARKS and associated goodwill as part of a merger, sale of assets, or any other transaction in which assets other than the TRADEMARKS and associated goodwill are also being transferred.
(b) Except in connection with the sale or transfer of Dial’s entire Armour business, Dial may not assign, by operation of law or otherwise, any of its rights, duties or obligations under this Agreement to any party such third party is hereinafter referred to as an “Assignee”), without the prior written consent of ConAgra, which consent will not be unreasonably withheld. Any such Assignee must assume all of the terms, covenants and conditions of this Agreement and all of the duties and obligations of the licensee hereunder.
(c) In determining the reasonableness of withholding consent to an Assignment, the parties agree that it shall not be deemed unreasonable for ConAgra to consider (i) whether the Assignee (or its affiliates) competes with the business of ConAgra, and (ii) the financial solvency of the Assignee. The consent of ConAgra, to an Assignment shall not constitute a consent to any subsequent Assignment by Dial or to any subsequent or successive Assignment by the Assignee.
(d) Any Assignment in violation of this Agreement shall be void and a material breach of this Agreement.
4. BOOKS AND RECORDS
Dial covenants to keep and maintain accurate books and records of transactions affecting the SHELF-STABLE PRODUCTS and the ROYALTY relating thereto. Books and records for each year shall be retained for a total of three years following the close of each such year. ConAgra shall have reasonable access to the books and records of accounts of those transactions involving the sales of the SHELF-STABLE PRODUCTS in order to determine and/or clarify the amount of sales and the ROYALTY due ConAgra. If after such analysis it is determined that Dial has understated the ROYALTY due ConAgra, then Dial shall pay the shortage within ten (10) business days following receipt of written notice and supporting substantiation of the understated ROYALTY. ConAgra
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agrees that it will not seek access to Dial’s books and records more than one time each in any twelve (12) month period and then only during regular business hours at the location at which such books and records are regularly or actually maintained.
RELATIONSHIP BETWEEN PARTIES
Nothing contained in this Agreement shall be construed to place the parties in the relationship of legal representatives, partners, joint venturers, agents or fiduciaries, and no party shall take any action nor incur any debts, obligations or liabilities in the name of the other.
6. INDEMNIFICATION AND LIMITATION OF LIABILITY
(a) Dial agrees to indemnify and hold ConAgra and ConAgra’s officers, directors, employees, shareholders, affiliates and agents harmless from any claim, suit, loss, damage, demand or expense, or cause of action or claim of any third party (collectively, a “Claim”), arising from or relating to (i) the inaccuracy or breach, as applicable, of any representation, covenant or warranty made by Dial in this Agreement or (ii) Dial’s manufacture, production, distribution, sale, marketing and/or advertising of the SHELF-STABLE PRODUCTS or use of the TRADEMARKS.
(b) ConAgra agrees to indemnify and hold Dial and Dial’s officers, directors, employees, shareholders, affiliates and agents harmless from any claim, suit, loss, damage, demand or expense, or cause of action or claim of any third party (collectively, a “Claim”) arising from or relating to (i) the inaccuracy or breach, as applicable, of any representation, covenant or warranty made by ConAgra in this Agreement or (ii) ConAgra’s use of the TRADEMARKS in connection with products or services other than the SHELF-STABLE PRODUCTS.
THE TRADEMARKS, OWNERSHIP, USE, INFRINGEMENT
(a) Subject to Section 7(b) below, ConAgra shall retain the full and complete ownership of the TRADEMARKS, including all goodwill associated therewith, subject only to the specific rights granted to Dial pursuant to this Agreement. All goodwill arising from Dial’s use of the TRADEMARKS will inure solely to the benefit of ConAgra. Dial shall cooperate if ConAgra registers, files or prosecutes, at ConAgra’s expense, any application that ConAgra may desire to file for TRADEMARKS, and, for that purpose, Dial shall supply ConAgra with such samples, containers, labels and similar materials as may be reasonably requested by ConAgra.
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(b) If Dial incorporates new terms or matter (collectively hereinafter “NEW MATTER”) with any of the TRADEMARKS to create new trademarks that receive ConAgra’s approval for Dial’s use under this Agreement, then at the time of ConAgra’s approval, Dial and ConAgra shall agree in writing as to the ownership rights of the NEW MATTER. The parties understand that the intent of this paragraph is to recognize Dial’s ownership interest in and to NEW MATTER which is developed independently of ConAgra while ensuring that as between Dial and ConAgra, ConAgra retains the full, complete, sole and exclusive ownership interest in and to the TRADEMARKS.
(c) The SHELF-STABLE PRODUCTS shall be sold on an exclusive basis by Dial within the TERRITORY and may bear the TRADEMARKS as they exist as of the date of this Agreement or as they may from time to time be changed, modified or altered by ConAgra during the term of this Agreement. Nothing set forth herein shall limit or affect the right of ConAgra to modify or change the TRADEMARKS; however, ConAgra agrees that Dial’s form and manner of use of the TRADEMARKS as of the date of this Agreement or as may be approved by ConAgra from time to time, may continue.
(d) Each party shall promptly notify the other party in writing of any known or suspected infringements, imitations, or unauthorized uses of the TRADEMARKS by third parties. ConAgra in the first instance shall have the right and discretion to institute actions against third parties for infringement of the TRADEMARKS. ConAgra shall have the right to control any such action instituted by it, including employment of counsel selected by ConAgra. Dial shall cooperate with ConAgra, at ConAgra’s expense, in connection with any such action instituted by ConAgra. ConAgra may not without Dial’s written consent, enter into any settlement agreement, stipulated judgment or the like that would restrict or limit in any manner the rights granted to Dial in this Agreement.
If any such litigation instituted by ConAgra for infringement of the TRADEMARKS does not relate to allegedly infringing use in respect of SHELF-STABLE PRODUCTS, then ConAgra shall bear all expenses of such litigation and shall be entitled to all monetary recoveries, if any, as a result of such action. If any such litigation instituted by ConAgra for infringement of the TRADEMARKS does relate to an allegedly infringing use in respect of SHELF-STABLE PRODUCTS, then ConAgra shall give Dial the opportunity to pay one-half of all expenses of such litigation, including attorney’s fees, and to be entitled thereby to receive one-half of all monetary recoveries, if any, as a result of such action.
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If ConAgra declines to institute an action against a third party for infringement of the TRADEMARKS with respect to the SHELF-STABLE PRODUCTS, then Dial






