Pre-Effective Amendment to Registration of Securities by a Small-Business Issuer — Form SB-2
Filing Table of Contents
Document/Exhibit Description Pages Size
1: SB-2/A Pre-Effective Amendment to Registration of 142 740K
Securities by a Small-Business Issuer
2: EX-1 Underwriting Agreement 54 225K
3: EX-4.2 Instrument Defining the Rights of Security Holders 31 107K
4: EX-4.3 Instrument Defining the Rights of Security Holders 38 141K
5: EX-4.4 Instrument Defining the Rights of Security Holders 9 46K
6: EX-5 Opinion re: Legality 3 14K
7: EX-9.1 Voting Trust Agreement 6 27K
8: EX-9.2 Voting Trust Agreement 1 10K
9: EX-9.3 Voting Trust Agreement 1 10K
10: EX-9.4 Voting Trust Agreement 1 10K
11: EX-10.1 Material Contract 17 57K
12: EX-10.2 Material Contract 16 57K
13: EX-10.3 Material Contract 13 47K
14: EX-10.35 Material Contract 12 55K
15: EX-10.36 Material Contract 12 55K
16: EX-10.37 Material Contract 12 55K
17: EX-10.38 Material Contract 11 45K
18: EX-10.39 Material Contract 10 40K
19: EX-10.40 Material Contract 1 10K
20: EX-10.41 Material Contract 23 81K
21: EX-10.42 Material Contract 6 22K
22: EX-10.43 Material Contract 5 23K
23: EX-10.44 Material Contract 6 25K
24: EX-10.45 Material Contract 7 30K
25: EX-10.46 Material Contract 2 11K
26: EX-23.1 Consent of Experts or Counsel 1 8K
EX-10.41 — Material Contract
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CONTRACT # 7296 of
LICENSE AGREEMENT
THIS AGREEMENT (the "Agreement") is made as of this 27th day of February, 1996,
by and between MGM/UA LICENSING AND MERCHANDISING, A DIVISION OF METRO-GOLDWYN-
MAYER INC., a Delaware corporation ("MGM/UA") with offices at MGM Plaza, 2500
Broadway Street, Santa Monica, California 90404-3061, and SOUND SOURCE
INTERACTIVE INC., a California corporation ("Licensee"), with its principal
offices at 2985 East Hillcrest Drive, Suite A, Westlake village, California
91362 (each sometimes referred to as a "Party" and collectively referred to as
"Parties").
W I T N E S S E T H
WHEREAS, MGM/UA owns or controls certain proprietary rights in and to the
motion picture "All Dogs Go To Heaven 2" (the "Licensed Property");
WHEREAS, Licensee desires to manufacture, distribute and sell interactive
entertainment computer software utilizing the Licensed Property;
NOW, THEREFORE, the Parties do hereby agree as follows:
1. DEFINITIONS
For purposes of this Agreement, the following definitions
shall apply:
1.1. "Computer" shall mean any device which acts upon an embodied Computer
Software so as to communicate it to the user, whether separate from or integral
to the embodiment.
1.2. "Computer Software" shall mean any computer software containing full
and complete computer code, including the source code, the assembly code, the
object code and such data files and other files as are deemed necessary for such
computer software to achieve its functional purpose.
1.3. "Licensed Platform" shall mean Microsoft Windows and Apple Mcintosh.
The Computer Software shall be stored and delivered on Compact Disc Read Only
Memory ("CD-ROM"). Specifically excluded from this Agreement are upgrades,
increases in memory, add-ons, or peripherals not existing in the market as of
the date of this Agreement, Sega Systems, Sony PSX and 3DO platforms, any CD-ROM
peripherals with added power which increases the performance ( including
enhanced game play or graphics ) of the SUPER-NES as it exists and performs
today, any systems which deliver software over cable, phone lines, fiber optics,
or
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2)
broadcast media. All other systems, platforms or distribution channels, whether
now existing or created in the future, are also hereby specifically excluded
from this Agreement.
1.4. "Licensed Products" shall mean one interactive moviebook for use on
the Licensed Platforms as designed for personal computers. The format shall be
CD-ROM and will be designed for the three to ten year old children's market,
containing linear retelling of the story with interspersed video clips,
educational quizzes and puzzles, online dictionary, and appropriate animation
and "sound/event" buttons.
1.5. "Net Sales" shall mean gross unit sales of Licensed Products sold by
Licensee.
1.6. "Term" shall mean the period commencing February 27, 1996 and expiring
October 31, 1999, unless terminated earlier in accordance with the terms and
conditions herein.
1.7. "Territory" shall mean the world in the English language and localized
versions for Germany, Japan and France.
1.8. "Wholesale Price" shall mean, with respect to any
Licensed Products, the published price charged to dealers by
Licensee or its first-tier distributors for such Licensed
Products.
1.9. "Original Equipment Manufacturer" ("OEM") shall mean a
manufacturer of computer hardware, computer peripherals and software who bundles
or combines its products with software for
distribution.
2. GRANT OF LICENSE
2.1. MGM/UA grants and Licensee accepts, subject to the terms herein set
forth, and only until May 30, 1997, the EXCLUSIVE license in the Territory to
utilize the Licensed Property (but not any derivations thereof, including,
without limitation, any prequels, sequels or remakes thereof, or any characters
or roles associated with or related to or spun-off from the Licensed Property)
on and in connection with the manufacture, distribution and sale of the Licensed
Products as localized on the Licensed Platform. From June 1, 1997 through
the grant of license shall be deemed as non-exclusive license for the Territory
during the Term to use the five musical compositions entitled "It's Too Heavenly
Here", "It Feels So Good to Be Bad", "Easy Street", "I'll Always Be with You"
and "Count Me out" and the musical scores derived from the Licensed Property and
the master recordings thereof (the "Music") in the Licensed Products, provided
however, that Licensee shall not be permitted to use the Music in any device for
which the viewer is able or invited to manipulate or
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 2
in any way alter the Music.
2.3. The grant of license contained in section 2.1 does not extend to any
rights to any likenesses or voices of any actual persons whether or not embodied
in the Licensed Property. Except to the extent as MGM/UA shall, in its sole
discretion, in writing in each such instance specifically agree, Licensee shall
not utilize any of such likenesses or voices in designing, developing, or
creating the Licensed Products or in arranging for the manufacture,
distribution, or sale thereof. The costs or fees associated with the use of any
such likenesses or voices shall be governed by Section 7.3(b).
2.4. All rights whatsoever in the Licensed Property not specifically
granted herein are reserved to MGM/UA and may be freely exercised at any time by
MGM/UA or its designees without accounting to Licensee and without any claim,
charge or encumbrance in favor of Licensee; Licensee shall have no rights
whatsoever in the Licensed Property except as explicitly set forth herein. In
particular, MGM/UA shall have the right to license, manufacture, sell or
distribute other products incorporating and/or using the Licensed Property, and
to make use of any and all means of exploitation and/or distribution related to
the Licensed Property, including, without limitation, the manufacture,
distribution and/or sale of Computer Software on any platform (including,
without limitation, the Licensed Platform) whatsoever. Without derogating from
any of the foregoing, MGM/UA specifically reserves any and all rights in roles
or characters which are or become a part of or associated with the Licensed
Products, whether or not such rights are initially part of the Licensed
Property.
3. CONSIDERATION
3.1. Royalties. In consideration for the rights granted to
it under this Agreement, the Licensee agrees to pay MGM/UA the
following royalties:
(a) The Licensee agrees to pay MGM/UA the following non-refundable
Advance Royalty Amount ("Advance"), which shall be set off as a
credit against the royalties due MGM/UA under subparagraph
3.1(b):
$20,000.00 to be paid as follows:
Four Thousand Dollars ($4,000.00) to be paid concurrently with
Licensee's execution of this Agreement;
Eight Thousand Dollars ($8,000.00) payable on or before June 1,
1996;
Eight Thousand Dollars ($8,000.00)
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 3
payable on or before March 1, 1997;
(b) Percentage royalties shall be computed as follows:
(i) For sales of the Licensed Products to a wholesaler or
distributor that will itself sell the Licensed Products to retail
accounts, other than bundled sales pursuant to (iii) below, Licensee
shall pay MGM/UA Fifteen percent (15%) of the Wholesale Price.
(ii) As to any Licensed Products that are sold by the Licensee on
an F.O.B. basis to a customer or distributor located in a country
other than the country from which the Licensed Products are shipped
(for example, a shipment of Licensed Products F.O.B. Hong Kong to a
customer in the U.S.), the royalty rate on such sales shall be five
percentage points higher than the applicable percentage royalty
specified in Section 3.1(b)(i).
(iii) As to sales of the Licensed Products bundled with Computer
hardware systems (i.e. sold as a single unit without a separate price
for the Licensed Products) by OEMs, Licensee shall pay MGM/UA Thirty
Percent (30%) of Licensee's revenues after deducting cost of goods
sold, cost of goods sold not to exceed One Dollar and Fifty Cents
($1.50) per unit.
(iv) All royalty computations under this Section 3.1(b)(i) and
(ii) shall be made on the basis of the Wholesale Price charged by the
Licensee, or, if the Licensee sells Licensed Products to a subsidiary
or other party controlled by the Licensee, on the basis of the
Wholesale Price for such Licensed Products charged by such subsidiary
or controlled party on resale of the Licensed Products.
(c) All amounts due MGM/UA under this Agreement shall be remitted by the
Licensee to the following address:
METRO-GOLDWYN-MAYER INC.
P.O. BOX 4073
SANTA MONICA, CALIFORNIA 90411
ATTN: LICENSING & MERCHANDISING
3.2. Licensee, and/or any related parties, agrees that they shall not,
without the written consent of MGM/UA, which consent shall be granted or
withheld in MGM/UA's sole discretion:
(a) Sell or otherwise distribute any Licensed Products at a so-called
premium, or to third parties which Licensee has
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 4
reason to believe intend to sell or distribute the Licensed Products as
Premiums. Sale or distribution of the Licensed Products as "Premiums", for
purposes of the foregoing provisions, shall mean sale or distribution of
the Licensed Products in connection with the following kinds of promotional
activities: self-liquidator programs; joint merchandising programs;
giveaways; sales incentive programs; door openers; traffic builders; and
any other kinds of promotional programs designed to promote the sale of the
Licensed Products or other goods or services of the Licensee or a third
party.
(b) Attempt to structure sales, distribution, or marketing plans for
the purpose of enhancing their revenues at the expense of MGM/UA; more
particularly, neither Licensee nor any Related Party shall make or attempt
to utilize Tier Sales for the purpose of lowering the revenue base for
determining MGM/UA's royalty share. A "Tier Sale" for purposes hereof
shall mean a sale by Licensee or a Related Party to a Related Party for the
purpose of further distribution.
4. ACCOUNTING PROVISIONS
4.1. Licensee agrees to forward to MGM/UA, within THIRTY (30) days after
the end of each calendar quarter ("Royalty Period"), commencing with the first
calendar quarter during which any unit of Licensed Products is sold, a report
(the "Accounting Statement") of the number of units of Licensed Products sold
within such Royalty Period and the royalty amount due for the sale of such
units. Each such Accounting Statement shall include a detailed cumulative
report, certified by Licensee's chief financial officer as accurate, of the
following information concerning each Licensed Products specified for or
allocated on a reasonable basis as to each country in the Territory:
(a) The number of Licensed Products held in inventory at the start
and at the close of the Royalty Period, distributed to customers during the
Royalty Period, and returned to Licensee during the Royalty Period.
(b) The Net Sales, and Wholesale Price for each category of Licensed
Products.
(c) The royalty of each category of Licensed Products so distributed.
(d) The royalties due to MGM/UA with respect to the Royalty Period.
(e) Any applicable currency exchange rates used to calculate
recoupment and remittances to MGM/UA, if applicable.
All royalties due to MGM/UA shall accrue upon sale of the Licensed
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 5
Products, regardless of the time of collection by the Licensee, less credits for
actual merchandise returns not exceeding, in any quarterly accounting period,
five percent (5%) of the Licensee's gross sale of the Licensed Products during
such accounting period. For purposes of this Agreement, a unit of Licensed
Products shall be deemed "sold" as of the date on which such item is billed,
invoiced, shipped or paid for, whichever first occurs. If any units are
consigned to a distributor by the Licensee, the units shall be considered "sold"
by the Licensee as of the date on which such distributor bills, invoices, ships
or receives payment for any of the units, whichever first occurs.
Notwithstanding anything herein to the contrary, in the event of a Tier Sale, at
MGM/UA's sole option, the Tier Sale shall not be a sale hereunder, but the first
non-Tier Sale sale thereafter shall be deemed the sale.
4.2. Licensee agrees that accompanying each such Accounting Statement shall
be payment of the amounts then due to MGM/UA for such Royalty Period, less any
unrecouped portion of the Advance. Any payments by Licensee not paid when due
shall bear interest, until paid in full, at a rate equal to the lesser of: (a)
the then highest rate permissible under the laws of California; or (b) a rate
two percent (2%) in excess of the then Bank of America, NT & SA, San Francisco,
published prime rate per annum, compounded annually, or, if such rate is no
longer published, at a rate two percent (2%) in excess of the then composite
prime rate per annum as listed in the Wall Street Journal.
4.3. Royalties in respect of sales outside of the United States shall be
computed in the national currency in which Licensee is paid by its distributors
and royalties shall be computed at the same rate of exchange as Licensee is paid
(or Licensee's account is credited).
4.4. The receipt or acceptance by MGM/UA of any Accounting Statements
furnished pursuant to this Agreement, or the receipt or acceptance of any
royalty payments made, shall not preclude MGM/UA from questioning their accuracy
at any time. If any inconsistencies or mistakes are discovered in such
statements or payments, appropriate adjustments shall be made immediately by the
Parties.
4.5. Licensee agrees to keep accurate books of account and records covering
all sales and royalties due under this Agreement and to permit MGM/UA and its
agents and representatives to inspect such books of account and records, and to
make copies thereof, during reasonable business hours (upon prior reasonable
written notice) for the purpose of verifying the reports provided hereunder. At
MGM/UA's request, Licensee shall provide an authorized employee to assist in the
examination of the Licensee's records.
4.6. There shall be no deduction from the royalties owed to
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 6
MGM/UA for uncollectible accounts, or for taxes, fees, assessments, or other
expenses of any kind which may be incurred or paid by the Licensee in connection
with: (i) royalty payments due MGM/UA; (ii) the manufacture, sale,
distribution, or advertising of the Licensed Products in the Territory; or (iii)
the transfer of funds or royalties or the conversion of any currency into U.S.
dollars. It shall be the Licensee's sole responsibility at its expense to
obtain the approval of any governmental authorities and to take whatever steps
may be required to: (a) effect the payment of royalties to MGM/UA;
(b) minimize or eliminate the incidence of taxes, fees, or assessments which
may be imposed; and (c) enable Licensee to commence or continue doing business
in any country. Licensee shall comply in any and all respects with all
applicable laws and regulations.
4-7. Notwithstanding the provisions of Section 4.6, if (i) any country
imposes a withholding tax against MGM/UA as licensor, with respect to the
royalties payable to MGM/UA by the Licensee on sales of the Licensed Products in
such country, (ii) such tax is paid by the Licensee on behalf of MGM/UA, and
(iii) such tax is an income tax as to which a foreign tax credit is allowable to
MGM/UA under section 901 of the Internal Revenue Code of 1986, as amended, the
Licensee may deduct the amount of such withholding tax from the royalties paid
to MGM/UA under this Agreement on the condition that the Licensee furnishes to
MGM/UA all information and documentation required by MGM/UA to enable MGM/UA to
obtain a foreign tax credit on its U.S. income tax return with respect to such
withholding tax payment by the Licensee.
5. CONTENT AND QUALITY OF LICENSED PRODUCTS; TIMING OF RELEASE
5.1. The Licensed Products and all related materials as manufactured,
advertised, sold or distributed by Licensee under this Agreement shall be of
first class quality. Without limiting the foregoing, Licensee will maintain a
policy of first class standards as to design, manufacturing, distribution and
sale of
the Licensed Products which will in no manner reflect adversely upon the
Licensed Property or the "Mark" as defined in Section 6.3).
5.2. The quality and style of all Licensed Products, artwork, packaging and
wrapping material, cartons, containers, tags, labels and all other devices used
in connection therewith and all advertising, promotional and display material,
if any, for the Licensed Products will be subject to the prior written approval
of MGM/UA which approval may be given or withheld in MGM/UA's sole discretion.
Licensee will submit the preliminary design and final design of each of these
items to MGM/UA for approval, to the attention of Susan Notarides or her
successor, at the address listed in Section 12 hereof. Any submission will be
deemed disapproved if not approved within twenty (20) calendar days of receipt
by MGM/UA. MGM/UA shall have no monetary obligation to
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 7
Licensee under this Agreement with regard to any disapproval of any item
(whether pursuant to this Section, Section 6.2 hereof, or any other provision of
this Agreement) subject to MGM/UA's approval pursuant to this Agreement.
Without limiting the generality of any other provision of this Agreement, in no
event shall Licensee, directly or indirectly, undertake or authorize any
billboard, television, radio or other mass media and/or other form or type of
advertising or press releases in connection with the Licensed Products or this
Agreement without MGM/UA's prior written consent in each instance.
5.3. Licensee agrees to furnish MGM/UA, for MGM/UA's approval (to be
granted or withheld in MGM/UA's sole discretion) as to content, quality and
style, a treatment or storyboard of each proposed Licensed Products to be
produced as well as the beta version of the Licensed Products. MGM/UA shall
grant or withhold such approvals according to the time schedule as set forth in
Section 5.2 hereof. All translations of written material used on or in
connection with the Licensed Products and/or Advertising Materials shall be
accurate, and the Licensee, when submitting the Licensed Products and/or
Advertising Materials for approval, shall provide MGM/UA with English
translations of all such written materials in a language other than English.
5.4. Licensee agrees that it will use its best efforts to promote actively
and effectively and to manufacture, sell and distribute each of the Licensed
Products in each of the countries in the Territory, during the Term of this
Agreement. Licensee agrees that it will use marketing efforts which are at
least equal to those made to promote its other products in the same countries.
The timing of the release of Licensed Products and the marketing release pattern
in each such country will be subject to MGM/UA's prior written approval in each
instance. If at any time during the Term, Licensee is not making regular sales
of more than a nominal nature of any Licensed Products in any country in the
Territory, MGM/UA shall have the right, upon thirty (30) days notice, to
terminate the Licensee's rights for all Licensed Products in such country.
5.5. Licensee shall, at Licensee's cost, insert in the packaging of the
Licensed Products, any consumer response forms
requested by MGM/UA.
5.6. Upon commencement of distribution of each Licensed Products, Licensee
will furnish and ship free of charge to MGM/UA fifty (50) samples of each such
Licensed Products, including packaging and two (2) samples of all advertising,
promotional and display materials relating to such Licensed Products. If
additional samples of either the Licensed Products or other materials referred
to herein are required for legal purposes, including protection of rights or
litigation, Licensee shall provide them free of charge.
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 8
5.7. Licensee will additionally sell the Licensed Products to MGM/UA, in
such quantities as MGM/UA requests, at Licensee's actual net per-unit cost Plus
shipping charges.
5.8. Licensee agrees that it will release the Licensed Products on the
Licensed Platform within thirty (30) days after final approval by MGM/UA of the
Licensed Product. For purposes of this Agreement, "release" shall mean the
manufacture of at least 25,000 units of such Licensed Products for shipment to
distributors.
5.9. Licensee shall in no event manufacture, sell or
otherwise distribute any Licensed Products without having obtained all approvals
by MGM/UA in each and every instance required hereunder.
6. TRADEMARK AND COPYRIGHT
6.1. "Notice" as used in this Section shall mean the appropriate statutory
notice of registration or application for registration of any licensed
copyright, trademark or service mark of which MGM/UA has given Licensee notice,
under the laws of the country where Licensee distributes the Licensed Products.
6.2. Licensee agrees to print, stamp or mold the Notice on each package or
container used in connection with the Licensed Products, and Licensee shall
print the Notice on each label, advertisement and promotional release concerning
any Licensed Products and such Notice shall be imprinted on the back of the
package or container used in connection therewith, displayed on the title screen
of the Licensed Products, and in the instruction booklet, if any, packaged with
the Licensed Products. All aspects of all Notices, including without limitation
size, credit, etc., shall be in accordance with the specifications of MGM/UA.
Licensee agrees to execute and deliver to MGM/UA, in such form as MGM/UA may
reasonably request, all instruments necessary to effectuate copyright, service
mark and trademark protection or to record Licensee as a registered user of any
trademarks or to cancel such registration, and if Licensee fails to execute such
instruments, Licensee hereby appoints MGM/UA as Licensee's attorney-in-fact to
do so on Licensee's behalf. Licensee shall also furnish MGM/UA for MGM/UA's
approval, samples of all advertising or promotional materials bearing the Notice
for MGM/UA's approval that such materials comply with Notice requirements
herein; any such submissions shall be deemed disapproved if not approved within
twenty (20) days of receipt by MGM/UA.
6.3. All Licensed Products which are released by or through Licensee in the
Territory shall embody on screen credits as designated by MGM/UA and on the back
of the packaging of such Licensed Products, MGM/UA's (and/or a division or
affiliate of MGM/UA's, as MGM/UA shall so notify Licensee) distinctive logo
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 9
(hereinafter referred to as the "Mark"). The size, placement and prominence of
the Mark and juxtaposition of the Mark shall be determined by MGM/UA in its sole
discretion. No other mark may appear as or more prominently than the Mark
without MGM/UA's prior written approval.
6.4. Licensee acknowledges and agrees that (a) all copyrights, trademarks,
and service marks and rights to the same referred to in this Section 6 in the
name of and/or owned by MGM/UA shall be and remain the sole and complete
property of MGM/UA; (b) all such copyrights, trademarks and service marks to the
same and rights in the name of or owned by any copyright proprietor other than
MGM/UA or Licensee shall be and remain the sole and complete property of such
copyright proprietor; (c) Licensee shall not at any time acquire or claim any
right, title or interest of any nature whatsoever in any copyright, trademark or
service mark owned or controlled by MGM/UA by virtue of this Agreement or of
Licensee's uses thereof in connection with the Licensed Products; and (d) any
right, title or interest in or relating to any such copyright, trademark or
service mark, which comes into existence as a result of, or during the term of,
the exercise by Licensee of any right granted to it hereunder shall immediately
vest in MGM/UA. Notwithstanding the foregoing, MGM/UA and Licensee shall
jointly own the Computer Software embodied in any Licensed Products except for
Licensee's proprietary technology ("Licensee Technology") not developed
specifically for the Licensed Products (including algorithms sprite and
animation technologies, data compression techniques and memory management tools
and procedures), which Licensee Technology shall remain the exclusive property
of Licensee and which Licensee Technology MGM/UA shall not analyze or reverse
engineer except as otherwise approved by Licensee in its sole discretion.
6.5. Licensee agrees to assist MGM/UA to the extent necessary to protect
any of MGM/UA's rights to the Licensed Property. Licensee shall notify MGM/UA
in writing of any infringements or imitations by others of the Licensed
Property on products similar to those covered in this Agreement which may
come to the Licensee's attention. MGM/UA shall have the right to commence
action to enforce its proprietary rights and prosecute any such
infringements, and Licensee agrees to fully cooperate, at MGM/UA's expense,
in any such action. However, Licensee shall not incur any such expense
reimbursable by MGM/UA without MGM/UA's express prior written approval and
all recoveries resulting from any such action shall belong solely to MGM/UA.
With regard to any infringements of Licensee's rights hereunder by third
parties, or with regard to any unauthorized imitations by third parties of
the Licensed Products, Licensee may, but only to the extent any such action
is specifically approved in writing by MGM/UA in advance: make demands or
claims, bring suit, and/or effect settlements (collectively, to make
"Licensee Claims"); provided that MGM/UA shall have the right to participate
fully at its own expense in any
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 10
litigation or other activity relating to any Licensee claim. Notwithstanding
anything herein to the contrary, in no event shall Licensee have the right,
without the specific prior written consent of MGM/UA: to acknowledge the
validity of any third party's claim (collectively, "Third Party Claims")
regarding any aspect of the Licensed Products or the Licensed Property; or to
take any other action which might impair the ability of MGM/UA to contest said
Third Party Claim if MGM/UA so elects.
6.6. Licensee acknowledges that the Licensed Property has extensive
goodwill, publicity, recognition and secondary meaning in the public in the
Territory. Licensee agrees that, except as set forth in Section 7.1, any works
(including, any copyright therein), characters, roles, artwork, trade names,
trademarks and tangible materials relating to or embodying any portion of the
Licensed Property (other than the Licensed Products themselves) and all good
will, publicity, recognition or secondary meaning accruing to the foregoing,
including any characters, created in whole or in part by Licensee, its agents,
contractors or employees, shall vest immediately and irrevocably in MGM/UA as
owner and employer upon creation, free and clear of any right, title, charge,
lien, encumbrance, limitation or claim in favor of Licensee. All of the
foregoing, together with the Licensed Property and the Marks (but not Licensee
Technology), are referred to as "MGM/UA's Property." Licensee agrees that any of
MGM/UA's Property created by Licensee's agents, contractors or employees
relating to the Licensed Property shall be deemed "works made for hire" within
the intended meaning of the Copyright Act of 1976, and all these works shall be
deemed transferred and assigned to MGM/UA promptly upon creation and without any
further action by either party and, to the extent any such property is not
deemed a "work made for hire", Licensee shall assign or cause such works to be
assigned to MGM/UA. It will be Licensee's responsibility: (a) to have
independent contractors or sublicensees (if allowed hereunder) who do creative
work in connection with this Agreement execute an appropriate assignment
document to MGM/UA, and/or (b) to provide a statement from Licensee that such
documents/agreements have been executed or are part of an existing employment
contract or work for hire agreement between Licensee and such third parties.
7. MATERIALS
7.1. All Computer Software (other than Licensee Technology) embodying the
Licensed Products, or any reproduction thereof, shall be and remain MGM/UA's and
Licensee's Joint property, inclusive of all copyrights and right to copyright
therein and thereto for the life of the copyright therein, provided that
Licensee may not exploit such property except as provided under the terms hereof
and provided further that Licensee agrees that it shall not obtain any interest
in the specific Licensed Property which may be embodied in such Computer
Software. All Licensee Technology shall be and remain Licensee's sole and
exclusive property.
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 11
7.2. In MGM/UA's sole discretion, MGM/UA may make available to Licensee, at
a price to be negotiated in good faith, any artwork relating to the Licensed
Property which MGM/UA owns and which is reasonably available to MGM/UA for
Licensee's use in connection with the exploitation of the Licensed Property.
7.3. (a) In MGM/UA's sole discretion, MGM/UA may also provide to Licensee
free of charge (but subject to Licensee's payment of any applicable royalty,
union fees, guild fees, reuse fees, or other fees) for use in Licensed Products
any film footage from any motion picture, television or other audio-visual
production utilizing the Licensed Property that Licensee may require (provided
that Licensee shall pay MGM/UA's standard fees in connection with the
duplication or shipping to Licensee of any such material).
(b) Licensee shall make payments in the amount of $2,750.00 to each
of the following actors pursuant to their personal service agreements: Charlie
Sheen, Sheena Easton, Dom DeLuise, Ernest Borgnine, Bebe Neuwirth and George
Hearn. If Licensee requests any actor or actress to render additional services
(e.g., record separate dialogue or appear in additional film footage of an
applicable production) for use in connection with the exploitation of Licensed
Products, then Licensee shall be responsible for any payments due any actor or
actress rendering such additional services. Any and all such footage or other
material created in the course of such additional services shall be owned by
MGM/UA, subject to the grant of license hereunder.
8. REPRESENTATIONS AND WARRANTIES
8.1. Licensee hereby warrants and represents that:
(a) This Agreement has been duly authorized, executed and delivered
by Licensee;
(b) Licensee has the full power and authority to enter into this
Agreement and to perform its obligations hereunder;
(c) This Agreement constitutes the valid and binding obligation of
Licensee, enforceable in accordance with its terms;
(d) The making of this Agreement by Licensee does not violate any
agreement, right or obligation existing between Licensee and any other
person, firm or corporation;
(e) That all ideas, creations, materials and intellectual property
furnished by Licensee in connection with the Licensed Products will be
Licensee's own creation (except for matters in the public domain or
material which is licensed hereunder or which Licensee is fully licensed to
use relative hereto provided, however, that the form and substance of all
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 12
licenses from third parties to Licensee shall be subject to MGM/UA's prior
written approval); and
(f) That the Licensed Products and the manufacture, advertisement,
distribution, sale, and other exploitation thereof hereunder will not
infringe upon or violate any rights of any third party of any nature
whatsoever; provided that the immediately preceding clause shall not refer
to any cause of action, allegation or claim of infringement or violation of
any third party's rights based upon the Licensed Property except to the
extent due to Licensee's breach of the terms hereof.
9. BREACH AND TERMINATION.
9.1. Except as set forth below in Section 9.2 and 9.3, MGM/UA may terminate
this Agreement by notice to Licensee should Licensee breach any term or
condition of this Agreement, if Licensee does not cure the applicable breach or
default to MGM/UA's satisfaction within thirty (30) business days after
receiving such termination notice; should such breach or default not be
completely cured, this Agreement shall then be deemed automatically terminated
without any further notice or other action by MGM/UA.
9.2. Notwithstanding the foregoing, each of the following events shall be
conclusively deemed a material breach of this Agreement by Licensee, resulting
in a three (3) calendar day cure period (in each of which cases this Agreement
shall be deemed automatically terminated without any further notice or other
action by MGM/UA, unless said breach shall have been completely cured to
MGM/UA's satisfaction):
(a) Any failure or refusal by Licensee to make or deliver any payment
or statement to MGM/UA required under the terms of this Agreement.
(b) Any failure or refusal by Licensee to seek and obtain MGM/UA's
consent or approval or to comply with the terms and conditions of any
MGM/UA consents or approvals required by the terms of this Agreement.
(c) Any material failure to distribute or cause a distribution of
Licensed Products in accordance with the terms hereof or any use by or
under the authority of Licensee of any rights in the Licensed Property not
granted to Licensee hereunder.
9.3. This Agreement shall be automatically terminated with no cure period
permitted and no required notice or other action by MGM/UA if any of the
following events occur:
(a) Any breach by Licensee of the terms of any other
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 13
agreement between Licensee and MGM/UA which, after remaining uncured for
the relevant cure period, has resulted in termination of such agreement.
(b) Should Licensee (i) become insolvent or be unable to pay its
debts as they become due, (ii) make an assignment for the benefit of its
creditors, (iii) acquiesce in the filing of a petition for Licensee's
bankruptcy, the appointment of a receiver or trustee or liquidator for
Licensee, the distress or other forced sale of a substantial part of
Licensee's assets, or the convening of a meeting of Licensee's creditors,
(iv) seek the protection for itself of any applicable bankruptcy or
insolvency law, or (v) take, do or omit to do any action which has the
purpose or effect of substantial cessation of Licensee's business as a
firstclass product manufacturer in the Territory.
(c) Any assignment, sublicense or transfer by Licensee in violation
of the provisions of section 13 below.
(d) If Vincent J. Bitetti, chief Executive Officer and Eric Winston,
President, are no longer in their current capacities as operating
management of Licensee as a result of the transfer of the business and/or a
substantial part of the assets of the Licensee; subject in either case to
the following provisions. If the Licensee has reason to believe that such
a management change has occurred or will occur in the reasonably
foreseeable future, Licensee shall give written notice thereof to MGM/UA.
Within a reasonable time after receiving such notice, MGM/UA shall give the
Licensee written notice stating whether it approves or disapproves of such
a "change in management" and in the case of its disapproval thereof,
whether it exercises its right of termination hereunder if the "change in
management" has already occurred or will exercise its right of termination
if the "change in management" does occur as a result of the transfer of the
business and/or a substantial part of the assets of the Licensee. MGM/UA
agrees that it will not withhold its approval of any such "change in
management" on the part of the Licensee or exercise its right of
termination relative thereto hereunder in an arbitrary or unreasonable
manner. The foregoing disapproval provisions shall not limit in any way
the prohibitions in section 13 against assignments, sublicenses and other
transfers of this Agreement or the rights licensed under this Agreement.
9.4. After any order for relief under the U.S. Bankruptcy Code is entered
against the Licensee, the Licensee must assume or reject this Agreement within
sixty (60) days after the order for relief is entered. If the Licensee does not
assume this Agreement within such 60-day period, MGM/UA may, at its sole option,
terminate this Agreement by giving written notice to the Licensee, without
further
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 14
liability on the part of MGM/UA.
9.5. Upon the termination of this Agreement pursuant to this Section 9, all
royalties on sales previously made, and all advances and/or minimum guarantees
hereunder (whether or not yet accrued), shall become immediately due and payable
to MGM/UA.
9.6. Upon expiration or termination of this Agreement, Licensee shall
immediately cease all further manufacture, distribution, advertisement, sale,
rental and use of the Licensed Products and related materials and the use of all
Marks and shall terminate all agreements with manufacturers, distributors,
sublicensees (if allowed hereunder), and others which relate to such
manufacture, distribution, sale, rental or use. Within thirty (30) days after
the date of expiration or termination of this Agreement, Licensee shall submit
to MGM/UA a statement containing the following information (the "Final Inventory
Statement"):
(a) A statement attesting to the destruction or delivery to MGM/UA of
all molds, masters or other material used for the manufacture of the
Licensed Products, and
(b) A statement of the number, location and description of all unsold
copies of the Licensed Products in inventory or in process, either in
Licensee's own or anyone else's possession, on the date of said expiration
or termination (the "Closing Inventory") and the total unit cost of the
Closing Inventory.
MGM/UA shall have the right of access to Licensee's and/or any third parties'
(including, without limitation, any distributors' or any sublicensees')
warehousing, other facilities and books and records to take physical inventory
to ascertain or verify the accuracy of the information contained in the Final
Inventory Statement. MGM/UA shall have the right and option to purchase all or
any part of the Closing Inventory at the actual net per-unit cost to Licensee.
MGM/UA may exercise such option, if at all, by notice to that effect to Licensee
("Purchase Notice"): (c) specifying the amounts and description of the Closing
Inventory MGM/UA elects to purchase and designating the points where such
amounts of Closing Inventory should be shipped and the manner of shipment, and
(d) accompanied by payment to Licensee of the total unit cost of the amount of
Closing Inventory MGM/UA elects to purchase; said Purchase Notice shall be given
to Licensee no later than thirty (30) days after service to MGM/UA of a proper
Final Inventory Statement. Within ten (10) days after service to Licensee of
said Purchase Notice, Licensee shall ship the amounts of Closing Inventory
MGM/UA elects to purchase f.o.b. to the points designated by MGM/UA, by the
manner of shipment designated by MGM/UA, at MGM/UA's expense. Notwithstanding
anything to the contrary hereinabove set forth, only to the extent MGM/UA elects
not to purchase any or all of the Closing Inventory, and only in
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 15
the event this Agreement has expired by the passage of time and not been
theretofore terminated by MGM/UA: Licensee shall have a period of one Hundred
Twenty Days (120) days ("Sell-Off Period"), commencing on service to Licensee of
the Purchase Notice or on expiration of MGM/UA's option to purchase the Closing
Inventory, whichever shall occur first, within which to sell that part of the
Closing Inventory which MGM/UA has not elected to purchase. Licensee shall pay
royalties with respect to any Sell-Off Period activities, and furnish Accounting
Statements with respect thereto, in accordance with the provisions of this
Agreement otherwise applicable to such activities. Not later than twenty (20)
days following the expiration of the Sell-off Period, Licensee shall send to
MGM/UA a certificate signed under oath, stating the amount of the Closing
Inventory not sold during said period and attesting to the fact that all such
Closing Inventory not sold either: (e) has already been completely destroyed, or
(f) will be completely destroyed not later than twenty (20) days following the
date of said certificate. Licensee shall at its sole expense take all steps
required to insure such destruction.
9.7. The rights of termination provided herein are in addition to any other
rights of MGM/UA hereunder, including the right to obtain injunctive relief and
other equitable remedies. In particular, the parties acknowledge that breaches
specified in Section 9.1 will cause irreparable harm to MGM/UA not readily
measurable in monetary amounts, and for which MGM/UA shall, without waiving any
other rights and remedies, be entitled to seek injunctive and declaratory
relief.
9.8. The expiration and/or termination of this Agreement: shall forthwith
automatically terminate all ability of Licensee to manufacture, sell, or
distribute Licensed Products (other than sales or distributions of Closing
Inventory, strictly pursuant to the terms of Section 9.4 hereof, during the
Sell-off period); and shall forthwith automatically terminate all other rights
licensed or granted to Licensee under this Agreement. However, subject to the
foregoing, the expiration and/or termination of this Agreement shall not affect:
any obligations of MGM/UA under Section 10.2 hereof; or any obligations of
Licensee or rights of MGM/UA under Sections 2.2, 2.3, 3.1, 3.2, 4.1, 4.2, 4.3,
4.4, 4.5, 4.6, 4.7, 5.1, 5.2, 6.1, 6.2, 6.3, 6.4, 6.6, 7.1, 7.3, 9.61 10.1,
10.3, 11.1, 11.2 or 14.7.
10. INDEMNIFICATION
10.1. Licensee agrees to indemnify and hold MGM/UA (and its parents,
affiliates, subsidiaries, divisions, licensees, successors, assigns, and their
or any of their agents, officers directors and employees) harmless from and
against any liability, damage, cost or expense (including costs and reasonable
attorneys, fees) occasioned by or arising out of (i) a breach or alleged breach
of any of Licensee's representations, warranties and
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 16
agreements herein made, or any breach or alleged breach by Licensee of any term
or condition hereof; (ii) any unauthorized use of any patent, process, idea,
method or device in connection with the Licensed Products; or (iii) defects in
the Licensed Products.
10.2. MGM/UA agrees to indemnify and hold Licensee (and its parents,
affiliates, subsidiaries, divisions, licensees, successors, assigns, and their
or any of their agents, officers, directors and employees) harmless from and
against any liability, damage, cost or expense (including costs and reasonable
attorneys' fees) occasioned by or arising out of the breach of any Of MGM/UA's
representations and warranties contained herein.
10.3. With respect to any claims, demands or actions falling within the
scope of the foregoing indemnifications: (a) each party agrees promptly to
notify the other of and keep the other fully advised with respect to such claims
or demands and the progress of any such actions in which the other party is not
participating; (b) each party shall have the right to assume, at its sole
expense, the defense of a claim, demand or action made or filed against the
other party; (c) each party shall have the right to participate, at its sole
expense, in any action instituted against it and to approve any attorneys
selected by the other party to defend it, which approval shall not be
unreasonably withheld or delayed; and (d) a party assuming the defense of a
claim, demand or action against the other party shall not settle such claim,
demand or action without the prior written approval of the other party, which
approval shall not be unreasonably withheld or delayed.
10.4. Licensee agrees that it will obtain and maintain at its own expense,
product liability insurance from a recognized and qualified insurance company
(rated at least "All in Best's Insurance Guide) in the amount of at least one
Million Dollars ($1,000,000) per occurrence and Three Million Dollars
($3,000,000) in the aggregate for personal injury and One Million Dollars
($1,000,000) for property damage against any claims, suits, loss or damage
arising out of any alleged defects in the Licensed Products. Notwithstanding
the foregoing, MGM/UA may from time to time, effective upon notice thereof to
Licensee, require that these policy limits be increased so that the amount
thereof adequately protects MGM/UAfs interests. All Licensee's policies
hereunder shall be non-cancelable and non-modifiable except after thirty (30)
days prior written notice to MGM/UA by certified mail (return receipt
requested), in which case MGM/UA shall require a replacement policy meeting the
aforementioned criteria and reasonably satisfactory to MGM/UA. MGM/UA will be
named as an additional insured on all insurance policies called for hereunder.
As proof of Licensee's obtaining required insurance hereunder, a fully paid
certificate of insurance will be submitted to MGM/UA by Licensee within thirty
(30) days of the execution of this Agreement.
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 17
11. CONFIDENTIAL INFORMATION
11.1. Licensee acknowledges that, in the course of the performance of
this Agreement, it may obtain the confidential information of MGM/UA
(including, without limitation, the following items related to the Licensed
Property: underlying literary material, locations, creative elements, and
processes or other technological developments relating thereto). Licensee
shall, at all times, both during the Term of this Agreement and thereafter,
keep in confidence and trust all of MGM/UA's confidential information
received by it. Licensee shall not use the confidential information of
MGM/UA other than as expressly permitted under the terms of this Agreement or
by a separate written agreement. Licensee shall take all reasonable steps
(including, without limitation, requiring as needed that Licensee's officers,
employees, agents, or outside contractors, any of whom are granted access to
MGM/UA's confidential information, execute confidentiality agreements in a
form approved by MGM/UA prior to said persons' being granted such access) to
prevent unauthorized disclosure or use of MGM/UA's confidential information
and to prevent it from falling into the public domain or into the possession
of unauthorized persons.
11.2. Licensee hereby acknowledges that any breach of the foregoing is a
material breach which will cause irreparable injury to MGM/UA not readily
measurable in monetary amounts, and for which MGM/UA shall, without waiving any
other rights or remedies, be entitled to seek injunctive and/or declaratory
relief.
11.3. Notwithstanding the foregoing, this requirement of confidentiality
shall not apply (and disclosure of information in the following manner shall not
constitute a breach of this Agreement or be deemed to cause any damage to
MGM/UA) to information that is: (a) in the public domain through no wrongful act
of Licensee; (b) rightfully received by the receiving party from a third party
who is not bound by a restriction of nondisclosure; (c) already in the receiving
party's possession without restriction as to disclosure; (d) is required to be
disclosed by applicable rules and regulations of government agencies or judicial
bodies, any of which properly have jurisdiction; or (e) necessarily disclosed
and/or disseminated to the general public in connection with the release of
Licensed Products.
12. NOTICES
12.1. All notices to be given to either party hereunder shall be addressed
to such party at the address set forth below or at such other address as such
party shall designate in writing from time to time. All notices shall be in
writing and shall either be served by personal delivery or by certified or
registered mail return receipt requested, to the attention of an officer of
MGM/UA
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 18
and Licensee, as applicable. Except as otherwise provided herein, notices shall
be deemed given when personally delivered or three (3) days after being mailed,
except that notices of change of address shall be effective only after actual
receipt. Notices shall be sent as follows:
TO MGM/UA: MGM/UA Licensing and Merchandising,
a Division of Metro-Goldwyn-Mayer Inc.
MGM Plaza
2500 Broadway Street
Santa Monica, California 90404-3061
ATTN: Susan Notarides
TO LICENSEE: SOUND SOURCE UNLIMITED, INC.
2985 East Hillcrest Drive, Suite A
Westlake Village, California 91362
Attn: Vincent J. Bitetti
Tel No. 805-494-9996
Fax No. 805-495-0016
13. NO ASSIGNMENT OR SUBLICENSING OF RIGHTS; AGREEMENTS WITH
MANUFACTURERS
13.1. The Licensee shall not have the right to assign, sublicense or
otherwise transfer this Agreement or any of the rights granted to it under this
Agreement.
13.2. Notwithstanding the foregoing, the Licensee shall have the right to
arrange with another party to manufacture the Licensed Products and/or
components of the Licensed Products for exclusive sale, use, and distribution by
Licensee. Licensee shall have the further right to have the Licensed Products
manufactured and bundled with computer hardware and other software programs for
distribution by OEMs. Attached as Exhibit A hereto is MGM/UA's form
Manufacturers Representation Agreement. Licensee agrees to ensure that any and
all of its manufacturers will comply with the provisions contained therein.
Licensee further agrees to furnish MGM/UA with copies of its manufacturers
agreements within thirty (30) days after it enters into any such agreements.
13.3. The Licensee agrees strictly to enforce against its manufacturers
all of the provisions which are required to be included in such agreements for
the protection of MGM/UA, as provided in Section 13.2; to advise MGM/UA of any
violations thereof by manufacturers, and of corrective actions taken by the
Licensee and the results thereof; and, at the request of MGM/UA, to terminate
such an agreement with any manufacturer which violates any of such provisions
for the protection of MGM/UA.
14. MISCELLANEOUS
14.1. The entire understanding between the parties hereto
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 19
relating to the subject matter hereof is contained herein. There are no
representations, warranties, terms, conditions, undertakings or collateral
agreements, express, implied or statutory, between the Parties other than those
expressly set forth in this Agreement. This Agreement cannot be changed,
modified, amended or terminated except by an instrument in writing executed by
both Licensee and MGM/UA.
14.2. No waiver, modification or cancellation of any term or condition of
this Agreement shall be effective unless executed in writing by the Party
charged therewith. No written waiver shall excuse the performance of any act
other than those specifically referred to therein and shall not be deemed or
construed to be a waiver of such terms or conditions for the future or any
subsequent breach thereof.
14.3. This Agreement does not constitute and shall not be construed as
constituting a partnership or joint venture between MGM/UA and Licensee.
Neither Licensee nor MGM/UA shall have any right to obligate or bind the other
in any manner whatsoever, and nothing herein contained shall give or is intended
to give any rights of any kind to any third persons.
14.4. This Agreement shall be governed by the laws of the State of
California applicable to contracts made and to be wholly performed in the State
of California. Any claim, dispute or disagreement in respect of this Agreement
may be brought only in the courts of the State of California, in Los Angeles, or
the federal courts within the State of California, in Los Angeles, which courts
shall have exclusive jurisdiction thereof, and the Parties hereby waive all
objections thereto on the basis of lack of personal jurisdiction or venue.
14.5. The headings and captions used herein are inserted for convenience
of reference only and shall not affect the construction or interpretation of
this Agreement. This Agreement shall not be deemed effective, final or binding
upon MGM/UA or Licensee until signed by each of them.
14.6. If any provision of this Agreement is or becomes or is deemed
invalid, illegal or unenforceable under the applicable laws or regulations of
any jurisdiction, either such provision will be deemed amended to conform to
such laws or regulations without materially altering the intention of the
parties or it shall be stricken and the remainder of this Agreement shall remain
in full force and effect.
14.7. In the event of litigation between the Parties arising out of or
relating to this Agreement, the prevailing Party will be entitled to recover
court costs and reasonable fees of attorneys, accountants and expert witnesses
incurred by such a Party in connection with such action.
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 20
14.8. Except as explicitly stated to the contrary herein, all references
in this Agreement to "days" shall be deemed to mean "calendar days" and not
"business days".
IN WITNESS WHEREOF, the Parties hereto have signed this Agreement
as of the day and year first above written.
"MGM/UA"
MGM/UA LICENSING AND MERCHANDISING, a
division of METRO-GOLDWYN-MAY INC.
By: /s/ Susan Notarides
--------------------------------
SUSAN NOTARIDES
Its: Executive Vice President
"LICENSEE"
SOUND SOURCE UNLIMITED, INC.
By: /s/ Vincent J. Bitetti
--------------------------------
VINCENT J. BITETTI
Its:
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 21
EXHIBIT A
MANUFACTURERS REPRESENTATION AGREEMENT
Date:______________________
MGM/UA LICENSING & MERCHANDISING
MGM PLAZA, 2500 Broadway Street
Santa Monica, California 90404-3061
Gentlemen:
This letter will serve as notice to you that pursuant to the
License Agreement dated___________________________between MGM/UA
Licensing and Merchandising ("MGM/UA") and Sound Source Unlimited, Inc.
("Licensee"), we, ("Manufacturer"), have been engaged as the manufacturer for
Licensee. In consideration of your authorizing the manufacture of_____________
_______________________________________________________________________________
(hereinafter called the "Licensed Product"), we hereby agree that:
1. We will not manufacture the Licensed Products for anyone but
your Licensee;
2. We will not distribute the Licensed Products in any territory;
3. We will not manufacture more quantities of the Licensed Products than
ordered by Licensee;
4. We will not authorize any other party to manufacture the Licensed Products
for its account or the account of Licensee without the express written consent
of MGM/UA;
5. We will ship the duly authorized quantities of the Licensed Products only
to Licensee or its designee and only to the Territory of;______________________
_______________________________________________________________________________
_______________________________________________________________________________
______________________________________________________________________________;
6. We will not ( unless MGM/UA otherwise provides its consent in writing )
manufacture any merchandise utilizing any of the copyrighted materials and/or
trademark owned by MGM/UA, other than the Licensed Products;
7. We will permit MGM/UA or its designated representatives to inspect the
activities and premises, accounting books, and invoices of the Manufacturer
relevant to its manufacture and supply to Licensee, of copies of the Licensed
Products;
8. We will not publish or cause the publication of reproductions of the
Licensed Products in any publication or promotional
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 22
material, nor advertise that we are authorized to manufacture MGM/UA character
merchandise articles; and
9. Whenever Licensee ceases to require the Manufacturer to manufacture the
Licensed Products or if this subcontract supplier agreement expires or is
terminated, the undersigned Manufacturer, unless otherwise advised by MGM/UA,
will immediately send to Licensee or to MGM/UA any and all molds, plates,
engravings, or other devises used to reproduce the said copyrighted materials,
and/or trademarks or will give evidence of the destruction by affidavit, thereof
satisfactory to MGM/UA.
MGM/UA shall be entitled to invoke any remedy permitted by law for violation of
this Agreement by the Manufacturer. Without limiting the foregoing, Licensee or
MGM/UA shall have the right at the sole discretion of each, to terminate this
subcontract supplier agreement on ten (10) days written notice to the
Manufacturer.
It is understood that this engagement is on a royalty-free basis. We understand
that our engagement as the Manufacturer for the Licensee is subject to your
written approval. We request, therefore, that you sign in the space below,
thereby showing your acceptance of our engagement as aforesaid.
Very truly yours,
-------------------------
By: Manufacturer
ACCEPTED AND AGREED:
By:
-------------------------
MGM/UA LICENSING AND MERCHANDISING
SUSAN NOTARIDES
Executive Vice President
SOUND SOURCE/ALL DOGS GO TO HEAVEN (2) 23
Dates Referenced Herein
| Referenced-On Page |
|---|
| This ‘SB-2/A’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| | 10/31/99 | | 2 | | | | | None on these Dates |
| | 6/1/97 | | 2 |
| | 5/30/97 | | 2 |
| | 3/1/97 | | 4 |
| | 6/1/96 | | 3 |
| Filed on: | | 5/9/96 |
| | 2/27/96 | | 2 |
| List all Filings |
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