§ 10.05[C]	Form Agreement
MASTER LICENSE AGREEMENT: LICENSEE'S PERSPECTIVE (WORLDWIDE)
THIS AGREEMENT is entered into this [day] day of [month], [year] by and between [name of Licensor], an individual residing at [address of Licensor] ("LICENSOR"), and [name of Licensee], a [place of incorporation of Licensee] corporation with offices at [address of Licensee] ("LICENSEE").
W I T N E S S E T H :
WHEREAS, LICENSOR is a well-known celebrity and, by virtue of her ability and extensive experience, has developed an international fame and reputation and her name, image and likeness have acquired a strong secondary meaning in the mind of the purchasing public;
WHEREAS, LICENSOR owns and/or controls all trademark and merchandising rights relating to LICENSOR'S commercial persona including all trademark rights and registrations associated therewith as more fully described in Schedule A attached hereto (the "Licensed Trademarks") and is the owner of all publicity and privacy rights in the name and image of LICENSOR and other intellectual property rights relating thereto (the "Licensed Publicity Rights") (collectively, the "Licensed Property");
WHEREAS, LICENSEE is engaged in the manufacture, distribution and sale of [type of products] and intends to manufacture, distribute and sell a line of [type of products] of the type identified in Schedule A (the "Licensed Products");
WHEREAS, LICENSEE intends to develop a sub-licensing program to grant third parties (the "Sub-Licensees") the right to manufacture, distribute and sell products bearing the Licensed Property in the categories (the "Product Categories") identified more completely in Schedule A attached hereto (the "Sub-Licensed Products");
WHEREAS, LICENSEE is entering into this Agreement based, in part, upon the individual and particular ability of LICENSOR to promote and maximize the value of the Licensed Products for the benefit of the LICENSEE; and
WHEREAS, the parties intend for LICENSOR to grant to LICENSEE a master license permitting LICENSEE to manufacture, produce, distribute and sell a line of Licensed Products under the Licensed Property and to utilize the Licensed Trademarks and Licensed Publicity Rights in connection with the advertisement, promotion and sale of such Licensed Products subject to the terms and conditions contained in this Agreement and to grant sub-licenses to third-party Sub-Licensees to manufacture, produce, distribute and sell such Sub-Licensed Products;
NOW, THEREFORE, in consideration of the promises and agreements set forth herein, the parties, each intending to be legally bound hereby, do promise and agree as follows.
1. LICENSE GRANT
A. LICENSOR hereby grants to LICENSEE the exclusive right and license to use the Licensed Property to manufacture a line of Licensed Products as well as to advertise, promote, sell, market and distribute the Licensed Products within the territory as set forth on Schedule A hereto (the "Territory") and within the Distribution Channels as set forth on Schedule A (the "Distribution Channels") for the Term of this Agreement as defined in Schedule A (the "Term"). LICENSOR expressly reserves all other rights not expressly granted herein.
B. LICENSOR further grants to LICENSEE a limited, exclusive, non-transferable right to grant Sub-Licenses to third-party Sub-Licensees to use the Licensed Property to manufacture a line of Sub-Licensed Products in the Product Categories identified in Schedule A and as well as to advertise, promote, sell, market and distribute the Sub-Licensed Products within the territory as set forth on Schedule A hereto (the "Territory") and within the Distribution Channels as set forth on Schedule A (the "Distribution Channels") for the Term of this Agreement as defined in Schedule A (the "Term"), it being understood and agreed that all sub-licensing rights being granted hereunder are subordinated to the underlying license being granted. LICENSOR expressly reserves all other rights not expressly granted herein.
C. All rights not expressly granted herein are specifically excluded from this Agreement, including those Excluded Goods and Services specifically identified in Schedule A.
D. LICENSEE shall not use the Licensed Property or any of the Licensed Trademarks or Licensed Publicity Rights for any purpose other than as recited herein.
E. LICENSEE shall not knowingly use the Licensed Property including the Licensed Trademarks and Licensed Publicity Rights in any manner that conflicts with the valid intellectual property rights of any third party.
F. LICENSOR shall have the right to delete from this Agreement any of the Product Categories identified in Schedule A hereto should LICENSEE and/or its Sub-Licensee(s) fail to meet either the Product Introduction Date or the First Sale Date for such Product Category in the United States. In such event, LICENSOR shall so advise LICENSEE in writing of its intention to delete said Product Category from this Agreement and LICENSEE and/or its Sub-Licensee shall have one hundred eighty (180) days from the date of such written notification to cure such default. In the event that LICENSEE and/or its Sub-Licensee should fail to cure such default within such one hundred eighty (180) day period, such Product Category shall be deemed deleted from this Agreement and LICENSOR shall be free to commence the marketing and sale of products within such Product Category either itself or through a third-party licensee.
2. TERM OF THE AGREEMENT
This Agreement and the provisions hereof, except as otherwise provided, shall be in full force and effect commencing on the date of execution by both parties and shall extend for a Term as recited in Schedule A attached hereto (the "Term").
3. COMPENSATION
A. In consideration for the licenses granted hereunder, LICENSEE agrees to pay to LICENSOR during the Term of this Agreement a royalty in the amount recited in Schedule A attached hereto (the "Royalty") based on LICENSEE'S Net Sales of Licensed Products.
B. The Royalty owed LICENSOR shall be calculated on a quarterly calendar basis (the "Royalty Period") and shall be payable no later than thirty (30) days after the termination of the preceding full calendar quarter, i.e., commencing on the first (1st) day of January, April, July, and October with the exception of the first and last calendar quarters which may be "short" depending upon the effective date of this Agreement.
C. With each Royalty Payment, LICENSEE shall provide LICENSOR with a written royalty statement in a form acceptable to LICENSOR.
D. LICENSEE agrees to pay to LICENSOR an Advance against royalties (the "Advance").
E. "Net Sales" shall mean LICENSEE'S gross sales (the gross invoice amount billed customers) of Licensed Products, less all discounts and allowances actually given and, further, less any bona fide returns.
F. Late payments shall incur interest at the then prevailing prime rate from the date such payments were originally due.
G. All fees payable hereunder shall be based on the official exchange rate on the date on which such payment is due. If, by any reason of any governmental or fiscal restrictions effecting the convertibility, payment cannot be made in U.S. funds, then LICENSEE shall take such reasonable actions with respect to the payment due as LICENSOR shall direct.
H. LICENSEE shall be responsible for any taxes on revenues received from sublicensing in countries outside the United States while LICENSOR shall be responsible for any taxes levied on the receipt of income in the United States. Any taxes foreign to United States taxes imposed on fees or royalties payable under this Agreement shall be paid by LICENSOR or deducted by LICENSEE from amounts due LICENSOR hereunder only if such taxes are allowable by the United States as a credit on LICENSOR'S United States income tax return or would be allowable if the particular circumstance of the LICENSOR (such as that its profits are insufficient) causes disallowance. If not allowable, such taxes, if any, will be paid by the LICENSEE. Both parties will cooperate with one another to obtain the benefits of such double taxation agreements as may be applicable hereunder.
4. SUB-LICENSING ROYALTIES
All Gross Sub-Licensing Royalties (as hereinafter defined) from Sub-Licensees shall be paid directly to the LICENSEE and will be shared between the parties as follows:
1) LICENSEE shall be entitled to retain all of the Gross Sub-Licensing Royalties from sales of Sub-Licensed Products and accrue all earned Royalties on its own Net Sales of Licensed Products until the total of the Gross Sub-Licensing Royalties and LICENSEE'S accrued earned Royalties on its own Net Sales of Licensed Products reach [number] MILLION UNITED STATES DOLLARS ($number). Thereafter, the next [number] MILLION UNITED STATES DOLLARS in total Gross Sub-Licensing Royalties from sales of Sub-Licensed Products shall be paid directly to LICENSOR. Thereafter, LICENSEE shall retain the next [number] MILLION UNITED STATES DOLLARS in total Gross Sub-Licensing Royalties from sales of Sub-Licensed Products. Thereafter, all Gross Sub-Licensing Royalties from sales of Sub-Licensed Products shall be shared between LICENSOR and LICENSEE on a 70/30 basis (70% to LICENSOR and 30% to LICENSEE) and all Gross Sub-Licensing Royalties received from Sub-Licensees for the sale of Sub-Licensed Products shall be shared between LICENSOR and LICENSEE on a 75/25 basis (75% to LICENSOR and 25% to LICENSEE);
2) For purposes of this provision, Gross Sub-Licensing Royalties shall include all payments made by such Sub-Licensees to LICENSEE under an approved Sub-License Agreement for the use of the Licensed Property in any form, including any advance, guarantee or earned royalty, fixed payments or other payments whether in cash or barter but it shall not include any payments made for advertising or promotion. In the event LICENSEE is required to refund a Sub-Licensee its royalties due to unforeseen circumstances or acts of nature outside the control of Sub-Licensee, LICENSEE shall receive a credit from LICENSOR for LICENSOR'S portion of those Sub-Licensing Royalties;
3) LICENSEE agrees to pay LICENSOR a non-refundable advance against its share of the Sub-Licensing Royalties in the amount recited in Schedule A attached hereto which shall be creditable against such obligations as provided for herein. Once the total Advance has been earned off as provided for herein, LICENSEE shall thereafter make actual earned Royalty payments on its own Net Sales of Licensed Products directly to LICENSOR and shall divide the Gross Sub-Licensing Royalties as provided for herein.
5. AUDIT
A. LICENSOR shall have the right, upon at least ten (10) days written notice and no more than once per calendar year, to inspect LICENSEE'S books and records and all other documents and material in the possession of or under the control of LICENSEE with respect to the subject matter of this Agreement at the place or places where such records are normally retained by LICENSEE.
B. All books and records relative to LICENSEE'S obligations hereunder shall be maintained and kept accessible and available to LICENSOR for inspection for at least one year after the date to which they pertain.
C. In the event that an investigation of LICENSEE'S books and records is made, certain confidential and proprietary business information of LICENSEE may necessarily be made available to the person or persons conducting such investigation. It is agreed that such confidential and proprietary business information shall be retained in confidence by LICENSOR and shall not be used by LICENSOR or disclosed to any third party for a period of five (5) years from the date of disclosure, or without the prior express written permission of LICENSEE unless required by law. It is understood and agreed, however, that such information may be used in any proceeding based on LICENSEE'S failure to pay its actual Royalty obligation.
6. WARRANTIES AND OBLIGATIONS
A. LICENSOR represents and warrants that it has the right and power to grant the licenses granted herein and that there are no other agreements with any other party in conflict herewith.
B. LICENSOR further represents and warrants that the Property and/or Trademark do not infringe any valid right of any third party.
C. LICENSOR agrees to conduct herself with due regard to public conventions and morals, and agrees that she will not do or commit any act or thing that materially degrades her in society or brings her into public hatred or contempt, or that shocks public morals or decency in her community or otherwise substantially and materially devalues the value of this license grant. Any criminal indictment or legal complaint filed with a court for a felony involving moral turpitude by LICENSOR shall be deemed a material breach of this Agreement by LICENSOR. LICENSOR'S violation of this paragraph shall constitute a material breach of this Agreement.
7. SUB-LICENSING PROGRAM
A. Subject further to the terms and conditions herein specified, LICENSEE shall use commercially reasonable efforts to find and conclude business arrangements with Sub-Licensees that are advantageous to LICENSOR for the Licensed Property and, thereafter, to reasonably service such arrangements during the term thereof. In furtherance of LICENSEE'S duties as herein specified, LICENSEE will:
1) Develop and maintain at its own cost and expense during the Term of this Agreement a brand management and licensing team for the express purpose of exploiting the rights being conveyed herein, such brand management team to provide expert professional services in developing, commercializing and managing the Licensed Property. LICENSOR agrees to reimburse LICENSEE for the costs incurred by LICENSEE during the first three years of this Agreement in developing this team up to a maximum of 50% of the total revenues received from Sub-Licensees or $[number] per year, whichever is lower;
2) Periodically meet and confer with LICENSOR to discuss the state of the merchandising and licensing industry, particularly as it pertains to LICENSOR and the Licensed Property;
3) Develop a merchandising plan for the Licensed Property for both the Licensed Products and the Sub-Licensed Products and provide a copy of same to LICENSOR within thirty (30) days of the date of execution of this Agreement by both parties;
4) Implement the merchandising plan by contacting those prospective Sub-Licensees best able to produce Sub-Licensed products of the type and quality for the Property;
5) Negotiate all agreements with third-party Sub-Licensees using a form license agreement reasonably acceptable to LICENSOR and subject to LICENSOR'S approval and, in this regard, use commercially reasonable efforts to obtain the highest possible royalty rate from such Sub-Licensees, but in no event lower than 5%, unless consented to by LICENSOR, such consent not to be unreasonably withheld given the commercial realities of the situation;
6) Require that the Sub-Licensees institute and maintain record keeping and sales and royalty reporting services to the LICENSEE as reasonably requested by LICENSOR and monitor and oversee the licensing program with such third-party Sub-Licensees to ensure that the licenses, royalties, minimums, and sales reports are promptly submitted;
7) LICENSEE shall be responsible for the enforcement of the quality control provisions of the third-party Sub-License agreements which shall include periodic inspection of all Sub-Licensed Products and when deemed reasonably necessary by LICENSEE, conducting personal visits to the third-party Sub-Licensees' manufacturing facilities to ensure that the quality control provisions of the Sub-License agreements with the Sub-Licensees are being complied with. LICENSEE shall maintain, for a period of one (1) year, written reports of such reviews and visits and provide such reports to LICENSOR upon LICENSOR'S request;
8) LICENSEE shall engage in other such activities as the parties may mutually agree, and, in general, use commercially reasonable efforts consistent with sound business practices to maximize revenue generated from the exploitation of the rights granted hereunder and to enhance the value and reputation of the Licensed Property;
9) While LICENSEE is empowered to propose all necessary art, design, editorial, and other related approvals for the creation of the Sub-Licensed Products as well as to enforce the appropriately high standard of quality for all such Licensed Products created and produced pursuant to licensing and promotional agreements entered into pursuant to this Agreement, LICENSOR retains the right to approve art, design, and editorial matters, which shall not be unreasonably withheld, delayed or denied. LICENSEE agrees to submit to LICENSOR, for final approval, drafts, prototypes and finished samples of all Sub-Licensed Products and any and all advertising, promotional and packaging material related to said Sub-Licensed Products prior to the commencement of their manufacture and sale as otherwise provided for in this Agreement; and
10) LICENSEE shall oversee the payment by the Sub-Licensees of all royalties and other payments due under this Agreement. If necessary, LICENSEE shall conduct periodic royalty investigations of the Sub-Licensee's books and records to ensure that all payments have been made. The cost of such royalty investigations shall be borne by LICENSEE. However, any recoveries received as a result of such royalty investigation shall be initially applied against the cost of conducting such investigation and then divided equally between LICENSOR and LICENSEE.
B. All proposed Sub-License agreements entered into by LICENSEE under this Agreement shall be mutually agreed to between the parties, such agreement not to be unreasonably withheld, and will incorporate all of the essential terms provided for herein. The parties will agree upon certain minimum financial terms for such Sub-License agreement including minimum royalty requirements and parameters for establishing advances and guarantees, prior to the commencement of the Sub-Licensing program and provided that such Sub-License agreements fall within such pre-approved financial terms, they will be deemed pre-approved. In all events, LICENSEE shall use commercially reasonable efforts to maximize the financial terms of any Sub-License agreement and, in no event, shall it enter into any Sub-Licensee agreement for a royalty rate lower than 5% unless mutually agreed to by the parties to this Agreement, such agreement not to be unreasonably withheld. It is understood that LICENSEE will submit all such proposed Sub-License agreements to LICENSOR for its consideration and approval and LICENSOR will, thereupon, advise LICENSEE within ten (10) business days after receipt of the proposed agreement as to whether it agrees or disagrees to the terms thereof. Should LICENSOR fail to act within said ten (10) day period, such failure to respond shall be deemed a disapproval. LICENSEE may thereafter provide LICENSOR written notice of such failure and should LICENSOR fail to respond to such written notice within five (5) business days after receipt of such written notice, such original submission shall be deemed approved. All such Sub-License agreements with third-party licensees shall be between LICENSEE and the third-party Sub-Licensee. The basic form sub-license agreement that is to be used by LICENSEE in negotiating sub-license agreements with third-party sub-licensees has been deemed approved by Licensor as in form only—all prospective Sub-License agreements, even if in this form, must be submitted for approval by LICENSOR. Any and all additions, deletions and changes to this basic form agreement shall be subject to the absolute, unfettered express written approval of LICENSOR and notification of approval or disapproval shall be provided to LICENSEE within ten (10) business days after receipt of same by LICENSOR. The lack of response from LICENSOR within such ten (10) day period shall be deemed a disapproval of any proposed addition, deletion and/or change.
8. MARKETING
LICENSOR shall provide reasonable assistance to LICENSEE in marketing the Licensed Products, at LICENSEE'S request, but shall not be required to expend material amounts of time or money in doing so. LICENSOR shall be actively involved in promoting the Licensed Products and Sub-Licensed Products, (whether requested or not by LICENSEE) and wherever reasonably practicable and appropriate, shall publicly wear or use the Licensed Products and Sub-Licensed Products, particularly at public events, shows and appearances. Moreover, during the Term of this Agreement, LICENSOR shall not: (a) enter into any endorsement agreement or otherwise obligate or require LICENSOR to endorse any product or service for products that are then included under this Agreement; or (b) renew or extend any endorsement agreement obligating or otherwise requiring LICENSOR to endorse any product or service for products that are the subject of this Agreement, which agreement was in existence before the Effective Date of this Agreement.
9. PROMOTIONAL APPEARANCES AND ADVERTISEMENTS
A. LICENSOR agrees to furnish the services of LICENSOR, if requested by LICENSEE, to make up to four (4) personal appearances on behalf of LICENSEE in each calendar year of this Agreement at LICENSEE-sponsored events plus two (2) personal appearances at trade shows, such events and trade shows to be mutually agreed upon, taking into account other personal time commitments. Each such personal appearance shall take place within the continental United States and shall be limited to one (1) day not to exceed eight (8) hours per day. LICENSEE agrees to pay all reasonable and necessary expenses incurred by LICENSOR in connection with such personal appearances and shall provide LICENSEE with at least three (3) months prior notice for any such appearance.
B. LICENSOR agrees to furnish the services of LICENSOR to appear in up to four (4) photo shoots during each calendar year of this Agreement, for use in print advertisement. The photo shoots shall take place within the continental United States and LICENSOR shall have the right to select LICENSOR'S own hair and make-up consultants at LICENSEE'S expense, and LICENSOR shall have approvals over the photographer and the final selection of photographs, such approvals not to be unreasonably withheld. LICENSEE shall have the right to publish LICENSOR'S likeness only in connection with print advertisements that promote the Licensed Products exclusively. LICENSEE shall submit each such advertisement for approval by LICENSOR. LICENSEE agrees to pay LICENSOR all reasonable and necessary expenses incurred by or on behalf of LICENSOR in connection with such appearance. LICENSEE agrees to provide LICENSOR with at least three (3) months prior notice for any such photo shoot.
10. NOTICES, QUALITY CONTROL AND SAMPLES
A. The licenses granted hereunder are conditioned upon LICENSEE'S full and complete compliance with the marking provisions of the patent, trademark and copyright laws of the United States and other countries in the Territory.
B. The Licensed Products, as well as all promotional, packaging and advertising material relative thereto, shall include all appropriate legal notices as required by LICENSOR.
C. The Licensed Products shall be of a high quality which is at least equal to comparable products manufactured and marketed by LICENSEE and in conformity with a standard sample approved by LICENSOR.
D. At least once during each calendar year, LICENSEE shall submit to LICENSOR, for approval, two (2) samples of the Licensed Products.
E. The manufacture, packaging and storage of the Licensed Products shall be carried out only at premises approved by the LICENSOR or its nominee in writing from time to time. The LICENSOR or its nominee shall be entitled at any time on reasonable notice to the LICENSEE to enter, during regular business hours, any premises used by the LICENSEE or its Manufacturers for the manufacture, packaging or storage of the Licensed Products, to inspect such premises, all plant, workforce and machinery used for manufacture, packaging or storage of Licensed Products and all other aspects of the manufacture, packaging and storage of Licensed Products. The LICENSEE shall, and shall ensure that its Manufacturers shall make any changes or improvements to its premises, plant, workforce, machinery and other aspects of the manufacture, packaging and storage of Licensed Products as the LICENSOR or its nominee may reasonably request.
F. All Sub-License agreements with Sub-Licensees for the Sub-Licensed Products shall include the same provisions contained herein in the foregoing paragraphs as they relate to the Licensed Products and all Promotional Materials and Ancillary Materials relating thereto and LICENSEE shall use commercially reasonable efforts to ensure that all Sub-Licensees take all necessary steps to ensure that such provisions are being complied with.
11. NOTICE AND PAYMENT
A. Any notice required to be given pursuant to this Agreement shall be in writing and delivered personally to the other designated party at the above stated address or mailed by certified or registered mail, return receipt requested or delivered by a recognized national overnight courier service.
B. Either party may change the address to which notice or payment is to be sent by written notice to the other in accordance with the provisions of this paragraph.
12. PATENTS, TRADEMARKS AND COPYRIGHTS
A. LICENSOR shall seek, obtain and, during the Term of this Agreement, maintain in its own name and at its own expense, appropriate trademark or copyright protection for the Property and Trademark.
B. In the event that LICENSOR does not seek or obtain patent, trademark or copyright protection for a particular item or in a particular country where LICENSEE believes such protection is necessary, LICENSEE shall have the right to seek such protection in the name of LICENSOR and setoff all costs associated with seeking and maintaining such protection against the royalties owed LICENSOR.
C. The parties agree to execute any documents reasonably requested by the other party to affect any of the above provisions.
D. LICENSEE agrees that its use of the Property and/or the Trademark inures to the benefit of LICENSOR and that the LICENSEE shall not acquire any rights in the Property and/or the Trademark.
13. TERMINATION
A. This Agreement may be terminated by either party upon thirty (30) days written notice to the other party in the event of a breach of a material provision of this Agreement by the other party, provided that, during the thirty (30) day period, the breaching party fails to cure such breach.
B. LICENSEE shall have the right to terminate this Agreement at any time on sixty (60) days written notice to LICENSOR. In such event, all moneys paid to LICENSOR shall be deemed non-refundable and LICENSEE shall be relieved of any further obligations hereunder.
14. POST-TERMINATION RIGHTS
A. Not less than thirty (30) days prior to the expiration of this Agreement or immediately upon termination thereof, LICENSEE shall provide LICENSOR with a complete schedule of all inventory of Licensed Products then on-hand as well as all work in progress (the "Inventory").
B. Upon expiration or termination of this Agreement, except for reason of a breach of LICENSEE'S duty to comply with the quality control or legal notice marking requirements, LICENSEE shall be entitled, for an additional period of twelve (12) months and on a nonexclusive basis, to continue to sell such Inventory. Such sales shall be made subject to all of the provisions of this Agreement and to an accounting for and the payment of a Royalty thereon. Such accounting and payment shall be due and paid within sixty (60) days after the close of the said twelve (12) month period.
C. Upon the expiration or termination of this Agreement, all of the rights of LICENSEE under this Agreement shall forthwith terminate and immediately revert to LICENSOR and LICENSEE shall immediately discontinue all use of the Property and the like, at no cost whatsoever to LICENSOR.
15. GOOD WILL
LICENSEE recognizes the value of the good will associated with the Property and acknowledges that the Property and all rights therein including the good will pertaining thereto, belong exclusively to LICENSOR.
16. INFRINGEMENTS
A. LICENSOR shall be obligated, at its own cost and expense, to institute and prosecute lawsuits against third persons for infringement of the rights licensed in this Agreement.
B. If LICENSOR does not institute an infringement suit within thirty (30) days after LICENSEE'S written request that it do so, LICENSEE may institute and prosecute such lawsuit. Any lawsuit shall be prosecuted solely at the cost and expense of the party bringing suit and all sums recovered in any such lawsuits, whether by judgment, settlement or otherwise, in excess of the amount of reasonable attorneys' fees and other out of pocket expenses of such suit, shall be retained solely by the entity commencing such action.
C. Upon request of the party bringing the lawsuit, the other party shall execute all papers, testify on all matters, and otherwise cooperate in every way necessary and desirable for the prosecution of any such lawsuit. The party bringing suit shall reimburse the other party for the expenses incurred as a result of such cooperation.
17. INDEMNITY
LICENSOR agrees to defend and indemnify LICENSEE, its officers, directors, agents and employees, against all costs, expenses and losses (including reasonable attorneys' fees and costs) incurred through claims of third parties against LICENSEE challenging the authenticity of the originally submitted Property or alleging that LICENSEE'S use of the Property infringes the rights of another.
18. INSURANCE
A. LICENSOR shall obtain and maintain during the Term of this Agreement until such time as the LICENSEE has received a full credit for the Advance or one (1) year from the Effective Date of this Agreement, whichever is longer, a "Key Man Life Insurance Policy" for LICENSOR's life from a carrier reasonably acceptable to LICENSEE in the face amount as specified in Schedule A attached hereto payable to LICENSEE in the event of LICENSOR's demise. LICENSEE may thereafter, at its own cost and expense, continue such Key Man Life Insurance Policy.
B. LICENSOR shall obtain and maintain during the Term of this Agreement until such time as the LICENSEE has received a full credit for the Advance or one (1) year from the Effective Date of this Agreement, whichever is longer, a "Key Man Disability Insurance Policy" for LICENSOR from a carrier reasonably acceptable to LICENSEE in the face amount as specified in Schedule A attached hereto payable to LICENSEE in the event of LICENSOR's disability. LICENSEE may, thereafter, at its own cost and expense, continue such Key Man Disability Insurance Policy.
C. LICENSOR has no knowledge, actual or implied, of any reason why LICENSOR cannot obtain life or disability insurance on commercially reasonable terms.
D. LICENSEE shall, throughout the Term of the Agreement, obtain and maintain at its own cost and expense from a qualified insurance company licensed to do business in [State], standard Product Liability Insurance naming LICENSOR as an additional named insured. Such policy shall provide protection against any and all claims, demands and causes of action arising out of any defects or failure to perform, alleged or otherwise, of the Licensed Products or any material used in connection therewith or any use thereof. The amount of coverage shall be as specified in Schedule A attached hereto. The policy shall provide for ten (10) days' notice to LICENSOR from the insurer by Registered or Certified Mail, return receipt requested, in the event of any modification, cancellation or termination thereof. LICENSEE agrees to furnish LICENSOR a certificate of insurance evidencing same within thirty (30) days after execution of this Agreement.
19. CONFIDENTIAL INFORMATION
Subject to the provisions of this Agreement, LICENSOR shall keep confidential and not disclose to any person any information whether written or oral and in whatever medium which comes into its possession and relates to the business, products, financial and management affairs, customers, employees or authorized agents, plans, proposals, strategies or trade secrets of the LICENSEE or any Sub-Licensee and any other information of a confidential nature of the LICENSEE or Sub-Licensee or the terms of this Agreement ("the Licensee Confidential Information"). The LICENSOR shall not, and shall ensure that its employees shall not, use, copy or disclose any of the Licensee Confidential Information except as reasonably needed in the course of exercising the rights granted hereunder. The LICENSOR shall only disclose the Licensee Confidential Information to those of its employees to the extent that they need to know the same in order to comply with the terms hereunder and provide that those employees are bound by written obligations of confidentiality and non-use in favor of the LICENSEE and such obligations apply to the Licensee Confidential Information disclosed to them.
20. FORCE MAJEURE
It is understood and agreed that in the event of an act of the government, or war conditions, or fire, flood or labor trouble in the factory of LICENSEE or in the factory of those manufacturing parts necessary for the manufacture of the Licensed Products, preventing the performance by LICENSEE of the provisions of this Agreement, then such nonperformance by LICENSEE shall not be considered as grounds for breach of this Agreement and such nonperformance shall be excused while the conditions herein prevail and for two (2) months thereafter.
21. JURISDICTION AND DISPUTES
A. This Agreement shall be governed in accordance with the laws of the State of [State], United States of America.
B. Except as provided for herein, any dispute or disagreement which may arise between LICENSOR and LICENSEE in connection with either any interpretation of this Agreement or the performance or nonperformance thereof shall be settled by a board of three arbitrators without appeal under the rules of conciliation and arbitration of the International Chamber of Commerce. Unless otherwise agreed to by both parties, any arbitration shall be conducted in the city of New York, NY, in the United States of America. The judgment upon any award rendered by the arbitration tribunal may be entered in any court having jurisdiction thereof, for the purpose of judicial enforcement.
22. AGREEMENT BINDING ON SUCCESSORS
The provisions of this Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their heirs, administrators, successors and assigns.
23. WAIVER
No waiver by either party of any default shall be deemed as a waiver of prior or subsequent default of the same or other provisions of this Agreement.
24. SEVERABILITY
If any term, clause or provision hereof is held invalid or unenforceable by a court of competent jurisdiction, such invalidity shall not affect the validity or operation of any other term, clause or provision and such invalid term, clause or provision shall be deemed to be severed from the Agreement.
25. NO JOINT VENTURE
Nothing contained herein shall constitute this arrangement to be employment, a joint venture or a partnership.
26. ASSIGNABILITY
This Agreement and the licenses granted hereunder may not be assigned by any act of LICENSEE or by operation of law unless in connection with a transfer of substantially all of the assets of LICENSEE or with the consent of LICENSOR, which consent shall not be unreasonably withheld or delayed.
27. GOVERNMENTAL APPROVAL
As promptly as possible after execution of this Agreement, LICENSEE agrees to submit copies of this Agreement to any governmental agency in any country in the Territory where approval of a license agreement is necessary and agrees to promptly prosecute any such application diligently. This Agreement shall only become effective in such country or countries upon receipt of appropriate approval from the applicable governmental agency.
28. GOVERNING LANGUAGE
This Agreement is in the English language. No translation of this Agreement into any language other than English shall be considered in the interpretation thereof and in the event that any translation of this Agreement is in conflict with the English language version, the English version shall govern.
29. INTEGRATION
This Agreement constitutes the entire understanding of the parties, and revokes and supersedes all prior agreements between the parties, including any option agreements which may have been entered into between the parties, and is intended as a final expression of their Agreement. It shall not be modified or amended except in writing signed by the parties hereto and specifically referring to this Agreement. This Agreement shall take precedence over any other documents which may be in conflict with said Agreement.
IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby, have each caused to be affixed hereto its or his/her hand and seal the day indicated.
[Name of Licensor]	[Name of Licensee]	

By:	By:	
Title:	Title:	
Date:	Date:	
SCHEDULE A
1. Licensed Trademarks
The following Licensed Trademarks form part of this Agreement:
2. Licensed Products
The following Licensed Products form part of this Agreement:
3. Sub-Licensed Products and Product Categories
The following Sub-Licensed Products and Product Categories form part of this Agreement:
4. Excluded Goods and Services
The following Goods and Services are excluded from this Agreement:
5. Territory
The following countries shall constitute the Territory:
6. Distribution Channels
The following shall constitute the channels of distribution:
7. Term
This Agreement shall commence on the date executed by both parties and shall extend for an initial Term of: [number] ([#]) YEARS.
LICENSEE shall have the right to renew this Agreement for Renewal Terms of [number] years provided that during the then in-effect Term, LICENSEE shall have paid to LICENSOR total royalty income of at least [number] UNITED STATES DOLLARS ($[#]).
8. Royalty Rate
LICENSEE shall pay the following royalty rate: [number] PERCENT ([#]%).
9. Advance
LICENSEE agrees to pay LICENSOR an Advance of [number] UNITED STATES DOLLARS ($[#]) upon execution of this Agreement.
10. Product Liability Insurance
[Number] Million Dollars ($[#]) combined single limit for each single occurrence for bodily injury and/or for property damage.
11. Key Man Insurance
[Number] Million Dollars ($[#]) payable to LICENSEE in the event of LICENSOR's demise. LICENSEE shall reimburse LICENSOR for [number] PERCENT ([number]%) of the cost of such insurance.
[Number] Million Dollars ($[#]) payable to LICENSEE in the event of LICENSOR's disability. LICENSEE shall reimburse LICENSOR for [number] PERCENT ([number]%) of the cost of such insurance.
12. Product Introduction/Initial Shipment/First Sale
The Product Introduction Date for all Licensed Products in the Territory shall be [insert date].
The Initial Shipment Date for all Licensed Products in the Territory shall be [insert date].
The following shall constitute the First Sale Dates for the following products and services: