EXHIBIT 10.6
(Free Translation)
LICENSING AGREEMENT FOR BRAND USE
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By the present private Instrument, the Parties named as follows:
(a) NET BRASIL S.A., a joint stock company headquartered in the City and
State of Sao Paulo at Avenida Brasil, 1,612, registered in the CNPJ under No.
01.007.021/0001-00, herein represented in accordance with its By-Laws, and
hereafter referred to simply as "NET BR";
(b) NET SERVICOS DE COMUNICACAO S/A, headquartered in the City and State of
Sao Paulo at Rua Verbo Divino, 1,356, 1st Floor, registered in the CNPJ under
No. 00.108.786/0001-65, herein represented in accordance with its By-Laws by its
legal representatives, and hereafter referred to simply as "MSO";
WHEREAS:
NET BR is the legitimate owner of "NET" (the "Brand"), having preferential
rights over the same with regard to communication services and related
activities, whose registers are duly listed in Annex I to this Instrument, being
able, at its discretion, to license the same "Brand" to third parties:
MSO, recognizing the ownership and prestige that the "Brand" has won in the Pay
TV market, is the licensee of the "Brand" since 1994 and intends to continue
using the same in its own activities and/or those of its operators, carried out
within the territory as authorized by ANATEL;
MSO and NET BR are committed to using and licensing, respectively, the "Brand"
in compliance with the Commitment Agreement executed between the Parties on this
date ("Commitment Agreement"), to which this instrument is linked and
subordinated;
MSO recognizes that the value of the "Brand" is directly associated with the
quality standards adopted by NET BR in the Pay TV sector, and that the same MSO
must strictly observe the same standards in its use of the
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"Brand" in accordance with the terms of this Instrument and the Commitment
Agreement;
The Parties hereby resolve to sign this Licensing Contract for Use of the
"Brand" in accordance with the following clauses and conditions:
1. DEFINITIONS OF CONTRACTUAL TERMS:
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1.1. For the purposes of this Agreement, the words and expressions used as
defined terms shall have the same meanings as those appearing in the Commitment
Agreement. The following definitions are also established:
(a) Manual: is the written document provided by NET BR to MSO which contains
confidential information and instructions regarding the "Brand" and its use, to
which shall be added for the same effects, any alterations that may be made in
the course of this Agreement, in compliance with the rules established herein;
(b) Brand: in addition to the NET brand, itself established in Annex I, this
shall also include the other brands listed in the same Annex I.
(c) Brands: are the distinctive signals, required by the Instituto Nacional da
Propriedade Industrial (INPI) [National Institute of Industrial Property],
presented in nominative, figurative and/or mixed form, owned by NET BR, to which
shall be added, without limitation, the numbers listed in Annex II, in different
market segments, requested in accordance with the international classification
(ncl), as well as all other signals, expressions, logotypes and/or nomenclatures
of ownership of NET BR or that are licensed to the same by third-parties, which
are made expressly available to MSO, in the future, at the exclusive discretion
of NET BR.
(d) Territory: is the territory of operation of MSO, including all of the
Locations in which the subsidiaries of MSO, current or future, carry out Pay TV
activities.
(e) Location: is the area of coverage of the public concessions and/or
authorizations for which the operators, controlled by MSO, are authorized to
distribute Pay TV content, as defined in the "Commission Agreement".
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(f) Line Up Net: is the programming contracted by NET BR from the programmers in
the form of the Commission Agreement, ordered by NET BR, to be shown by MSO to
its subscribers via the signal transmission systems, as defined in the
Commission Agreement.
(g) Commission Agreement: executed by the Parties on this date, whose object
is the retaining of NET BR as commissionaire of MSO for the specific purpose of
negotiating certain content for Pay TV in accordance with the terms contained
therein.
2. THE OBJECT:
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2.1. The object of this Agreement is the exclusive license that NET BR shall
grant to MSO and to its subsidiaries, being Pay TV operators, both on the
present date and in the future, for the use of the "Brand", solely for the
purpose of providing Pay TV services, through the Authorized Signal Transmission
Processes, as defined in the Commission Agreement (First Clause, letter "o")
within the Territory.
2.1.1. The use of the "Brand" by MSO within the Territory is linked to
compliance with the terms of the Commitment Agreement between the
Parties, and to the transmission by NET BR, appearing in Line Up Net,
strictly in the form established in the Commission Agreement.
2.2. NET BR undertakes (i) not to use the "Brand" forming the object of this
instrument within the Territory (ii) or to allow third parties to use it. It is
hereby agreed that NET BR may only use the "Brand" within the Territory, with
the proviso that such use is made in conjunction with MSO.
2.3. MSO undertakes not to associate and/or use the "Brand" to indicate any
products and/or services that are not directly and exclusively linked to the
provision of Pay TV services.
2.3.1 The Parties undertake to establish, in a separate document, the rules of
utilization by MSO of the "Brand" in conjunction with the distinctive
signals of the other services that it provides, including, but not limited
to the "Brands" (with these latter under a "Co-Branding" regime).
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2.4. MSO recognizes that NET BR shall establish its own standards for the use
of the "Brand", for which reason MSO agrees that the "Brand" shall only be used
in the form and in the manner previously approved by NET BR, including the terms
of the Manual, albeit in compliance with the terms established in paragraph
2.4.1.
2.4.1. NET BR may alter the conditions and the use standards of the "Brand"
provided that this alteration in no case causes a substantial reduction in the
current use by MSO, with substantial use being understood to mean any
restriction on the object of the license contracted herein. Alterations that do
not result in a substantial reduction, provided that these have been previously
established in accordance with the criteria set in this clause, shall be
incorporated by MSO. For such purposes, NET BR undertakes to consult MSO on a
prior basis with regard to proposed alterations and to consider the aspects
raised by MSO with regard to each proposed alteration. Having defined the
alteration, NET BR undertakes to grant a reasonable and sufficient deadline,
through notification in writing, of at least 60 (sixty) days, for MSO to adapt
itself to the new conditions and standards. Necessary alterations to the
conditions and the standards for use of the "Brand", including, and in
particular when these entail additional investment, shall always be discussed
and implemented in accordance with a timetable that is adjusted in full
agreement between the parties, in observance of the procedures of this clause.
2.5. In addition to the standards established by NET BR, MSO undertakes to
use the "Brand" in strict accordance with the terms of the Law of Industrial
Property (Law 9.279 of May 14, 1996), with regard to other applicable provisions
and this Agreement.
2.6. MSO hereby receives from NET BR, in the form of a loan free of charge,
an updated copy of the Manual, which forms an integral part of this Instrument,
with MSO obliged to use the "Brand" in accordance with the instructions and
rules of application of the "Brand" that it contains, remaining entirely
responsible for the safekeeping, confidentiality and non-reproduction of the
Manual, as well as for the loss, theft or theft with assault of the same and the
losses and damages arising therefrom.
2.6.1. In the event of the ordinary expiry of the term or the termination
of the agreement on any of the grounds for termination of contract, MSO
shall return to NET BR the Manual granted in the
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form of a loan free of charge, within a maximum period of 5 (five) days
starting from the date of liquidation or termination of the Agreement.
2.7. MSO recognizes that for the adequate use of the "Brand" it is absolutely
indispensable that the Pay TV services are provided by it in the best form and
in observance of appropriate quality standards adopted by the other operators
retained by NET BR in an equivalent way for Pay TV services and which use the
same "Brand" outside the Territory.
3. TERM OF THE AGREEMENT:
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3.1. This Agreement shall take effect on the date of its signing, for the same
term as the Commission Agreement. In the event of termination of the Commission
Agreement, for whatever reason, MSO shall be authorized to use the "Brand" for
an additional maximum period of 30 (thirty) months, as established in Clause 6.5
below. During this period, MSO undertakes to make use of the "Brand" in
observance of this instrument and the "Manual".
4. VALUE:
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4.1. This license is granted free of charge.
5. CONFIDENTIALITY:
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5.1. The Parties undertake, for themselves, their representatives, and
retained third parties, to maintain absolute secrecy with regard to all and any
information obtained as a function of this Agreement, including as a result of
due diligence carried out.
5.2. The Parties undertake not to reveal or disclose, at any time, to any
other individual or corporate entity, any written or oral confidential
information transmitted by any means, unless (a) they are obliged to do so by
virtue of a judicial order and/or legal determination, in which case, the other
party must be notified in writing; (b) if the other party authorizes the same in
writing; (c) if eventual operations are in progress for the disposal of its
assets or equity interests, for the raising of financial resources or for
commitments for disposal, provided that the third parties to which the
information is revealed sign, before the revelation or disclosure of the
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same, a commitment to respect the terms of confidentiality agreed herein.
5.3. Confidential information is understood to mean all documents, manuals,
drawings or communications that are transmitted to MSO, verbally or in writing,
including in electronic form, which, by virtue of this Agreement, are not
expressly indicated as non-confidential or that are not widely known to be in
the public domain.
6. TERMINATION AND ITS EFFECTS:
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6.1. This Agreement may only be terminated unilaterally by the Parties, without
penalty, through prior notice of 30 (thirty) days, in the following events:
(a) if the bankruptcy of any one of the Parties is declared or one of the
same files for composition with creditors (concordata);
(b) if, for whatever reason, any one of the Parties becomes insolvent or is
subject to actions or protest of title that compromise its financial
and/or technical capacity, preventing it from complying with the
obligations assumed in this Agreement;
(c) in the event that any of the Parties is unable to execute in full any of
the obligations arising from a law, regulation or rule issued by ANATEL,
the Ministry of Communications or another government agency, or any
non-appealable judicial ruling;
(d) in the event of termination of the Commission Agreement, observing the
terms of Clause 10 of the same.
6.2. Excepting cases in which specific deadlines and penalties are
established, breach of any provision of this Agreement by any of the Parties
shall enable the innocent Party to notify the infringing Party with a view to
remedying the breach within at most 60 (sixty) days of the receipt of
notification.
6.3. In the event that MSO reproduces the Brands or makes undue use of the
same, it shall have 15 (fifteen) days from the date of notification to remedy
the breach.
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6.4. In the event that the same breaches have not been remedied by the guilty
Party by the deadlines for the same, the innocent Party may regard the Agreement
as having been terminated and the guilty Party shall pay a penalty to the
innocent Party equivalent to double the value of the last reimbursement of the
monthly cost of programming due per subscriber by virtue of the Commission
Contract, multiplied by the number of subscribers on the date of termination.
The fine shall be paid within at most 30 (thirty) days counted from the last day
of the period for remedy of the breach, without affecting the possible losses
and damages that may be determined, as well as any other fines and penalties
specifically established in this Agreement.
6.5. In the event of the liquidation or termination of this Agreement, for
whatever reason, MSO shall refrain from using the "Brand" within a maximum
period of 30 (thirty) months, as established in Clause 3.1. above, and shall
return the Manual to NET BR, within 60 (sixty) days of the effective liquidation
or termination of the Agreement.
6.5.1 In the event that MSO loses its license for a given location/given
locations, it shall ensure that the use of the "Brand' ceases at the same time
that it causes its own effective operation to cease.
6.5.2 In the event that MSO sells, transfers or in any way abandons effective
control over a given Location, the license forming the object of this Agreement
shall be maintained for the same Location, if this remains under obligation with
regard to NET BR, through MSO, of the Commission Agreement, for as long as this
situation persists, or through an independent Agreement that may be executed
with NET BR. In the event that the Location in question is exempted from
complying with the terms of the Commission Agreement or ceases to execute a
specific contract with NET BR, the license for the use of the "Brand" shall be
automatically and immediately terminated for the Location in question, without
requirement for compliance with the deadline established in Clause 3.1.
6.6. For the purposes of the terms of this item, the cessation of use of the
"Brand" implies the adoption by MSO, in accordance with the maximum deadline of
Clause 3.1. above, of the following procedures:
(a) abstaining from the use of the "Brand", removing the same and
destroying any goods and materials on which the "Brand" is
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reproduced, including papers for commercial use, envelopes,
promotional gifts, adhesive stickers for cars and equipment,
accessories, utensils and anything else that reflects the use of the
"Brand";
(b) ensuring the cessation of the association of the commercial name of
MSO with the "Brand", where these are used together in any way, and in
any medium in which they may appear;
(c) cessation of use or transmission of the "Brand" in its
relationships with Subscribers and any other agents or third parties,
whether in printed media, through television signals or through any
other medium;
(d) bearing all costs of communication to the Locations regarding the
cessation of use of the "Brand", both to Subscribers and to the
market, as well as bearing all the amounts that may be due as a result
of possible contingencies, claims, administrative and/or judicial
processes that may be demanded from NET BR, as a result of the
cessation of the use of the "Brand".
6.7. MSO shall not, in the event of termination of the Agreement for any
other reason than breach by NET BR, demand any indemnity with regard to the
same, in any capacity, including the loss of value, if any, of its business due
to the discontinuation of the use of the "Brand".
6.8. In the event of early termination, the rights of the Parties prior to
the termination shall be preserved, with the same obliged to make due payments
and comply with pending obligations.
7. GENERAL CONDITIONS:
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7.1. MSO, hereby and for all legal purposes, recognizes that NET BR is the
exclusive owner of the "Brand" and of all the rights inherent to the same,
including those deriving from goodwill generated by the use of the "Brand",
it being determined that the license hereby granted to MSO aims to meet,
solely and exclusively, the purposes of this Instrument, for which reason,
MSO agrees not to present any objection or to contest, whether directly or
indirectly, judicially or extrajudicially, the ownership and/or validity of
the "Brand" and all
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the other industrial and intellectual property rights of NET BR with
regard to the "Brand".
7.2. MSO may not, without the express agreement of NET BR, use the "Brand" in
its commercial name, or, in any circumstance, request the registration of terms,
brands, commercial names or logotypes identical or similar to the "Brand" or
that may be used in competition with the same or that lend themselves to
confusion with the same. In addition, MSO shall abstain from any action or
omission that may damage or weaken the rights of NET BR with regard to the
"Brand", assuming legal responsibility for any breach of the terms of this
clause.
7.2.1 The terms appearing in the preceding paragraph do not apply to the
registration of brands carried out by MSO and/or by its subsidiaries prior to
the signing of this Agreement, which are listed in Annex II to the same, with
the use of these brands until the present date being ratified and endorsed by
NET BR, provided that: (i) such registrations are ceded without encumbrance to
NET BR, through proof of protocol with the INPI, with the same effected by
January 3, 2005; (ii) starting from the transfer, the use of the assigned brands
is in accordance with the conditions established by NET BR for the use of the
same.
7.3. NET BR shall take responsibility for (i) the maintenance of the
registration and (ii) the adoption of the measures necessary for the protection
and defense of the "Brand".
7.4. MSO agrees to cooperate fully with NET BR in defending and protecting
the "Brand", undertaking to communicate to NET BR all and any undue use
of the "Brand" by third parties, as well as the use of words,
expressions, phrases, labels or figurative elements that constitute,
whether directly or indirectly, a violation of the rights of the NET BR
with regard to the "Brand", providing all available information and
data.
7.5. MSO undertakes to insert the indication that the "Brand" is registered
in the name of NET BR, in compliance with the instructions appearing in
the Manual.
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7.6. MSO agrees not to use any other brands and other identification
characteristics that are similar to the "Brand", or that may be
characterized as competing with the "Brand".
7.7. NET BR undertakes to secure the registration of this Instrument with the
Instituto Nacional da Propriedade Industrial (INPI) [National Institute
of Industrial Property], within a maximum period of 10 (ten) days of the
signing if the same, with the costs arising from the registration borne
solely and exclusively by NET BR. NET BR also undertakes to provide to
MSO a copy of the certificate granted by the INPI within at most 90
(ninety) days of the signing of the Agreement.
7.8. The obligations assumed by the Parties in this Agreement shall extend to
the successors of both in whatever capacity.
7.9. Any alteration or modification of the clauses and conditions of this
Agreement shall be made through a specific agreement, signed by the Parties,
with every or any verbal agreement or mere correspondence or e-mail exchanged by
the Parties remaining without effect.
7.10. This Agreement, and the obligations and rights arising from the same, may
not be assigned or transferred to third parties without the prior and express
authorization of the other party.
8. JURISDICTION:
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8.1. The courts of the City of Sao Paulo, State of Sao Paulo are chosen to
resolve any doubts or disputes that may arise from this Instrument. Where the
need for a judicial procedure arises, the defeated party shall pay all the costs
and expenses of the case including the legal fees of the prevailing party.
Being in agreement with regard to the above, the Parties have signed this
Instrument irrevocably and irreversibly in 4 (four) copies of equal content and
form for a single purpose, together with the 2 (two) witnesses below, who have
also signed the same.
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Sao Paulo, June 27, 2004.
/s/ Xxxxxxx Xxxxxx Pecegueiro xx Xxxxxx /s/ Xxxxxxxx Xxxxx
___________________________________________________________
NET BRASIL S.A.
/s/ Xxxxx Xxxxxx Xxxxxx /s/ Xxxx Xxxxxxxx
_____________________________________________
NET SERVICOS DE COMUNICACAO S/A
WITNESSED BY:
1. /s/ Alessandro Peciauscas 2. /s/ Xxxx Xxxxxxxx
__________________________ _________________________
Name: Alessandro Peciaauscas Name: Xxxx Xxxxxxxx
RG [ID Code]: 11.005.133.6 SSP/SP RG [ID Code]: 7037273269
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ANNEX I
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I.
[REGISTRATION XXXX]
Brand duly registered at the Instituto Nacional da Propriedade Industrial (INPI)
[National Institute of Industrial Property], under the numbers:
O 817.408.770, mixed presentation, class 09.35/40/45
O 817.408.789, mixed presentation, class 37.44/45
O 817.408.800, mixed presentation, class 40.15/20/25
O 817.408.797, mixed presentation, class 38.10
O 817.408.819, mixed presentation, class 41.20/40
II. "CLUBINHO NET UM MUNDO ALEM DA DIVERSAO" BRAND
[LOGO]
O 822129990, mixed presentation, class 38.10
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ANNEX II
Registrations granted
o NETKIDS - 819.322.199, nominative presentation, class 11.10;
o NETKIDS - 819.322.202, nominative presentation, class 38.10;
o SMART NET - 819.734.314, nominative presentation, class 38;
o BOLA NA NET - 820.587.630, mixed presentation, class 38;
o BOLA NA NET - 820.587.745, nominative presentation, class 38.10;
o NET ROC - 820.587.796, nominative presentation, class 38.10;
Requests for registration
o INTER NET - 818.365.021, mixed presentation, class 38.10;
o CLASSINET - 819.734.322, nominative presentation, class 11.10;
o VIRTUA PRIVATE NET - 822.464.985, nominative presentation, class
41;
o VIRTUA PRIVATE NET - 822.464.993, nominative presentation, class
38;
o NET DIGITAL - 823.204.979, nominative presentation, class 41;
o NET DIGITAL - 823.204.987, nominative presentation, class 38;
o NET TV DIGITAL - 826.219.527, nominative presentation;
o NET TV DIGITAL - 826.219.543, nominative presentation;
o CANAL NET TV - 823.778.908, nominative presentation;
o CANAL NET TV - 823.778.916, nominative presentation;
o CANAL NET TV - 823.793.923, mixed presentation;
o CANAL NET TV - 823.793.931, mixed presentation;
o CAMAROTE VIP NET - 824.351.894, nominative presentation;
o CAMAROTE VIP NET - 824.351.916, nominative presentation;
o SALA VIP NET - 824.351.908, nominative presentation;
o SALA VIP NET - 824.351.924, nominative presentation;
o FEST NET - 824.547.969, nominative presentation;
o NET EDUCACAO - 826.230.423, nominative presentation;
o NET EDUCACAO - 826.230.431, nominative presentation;
o NET DIGITAL - 826.876.820, mixed presentation;
o NET DIGITAL - 826.876.838, mixed presentation;
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o CABLE MODEM NET - 822.368.420, mixed presentation;
o CABLE MODEM NET - 822.368.439, mixed presentation;
o CABLE MODEM NET - 822.502.259, mixed presentation;
o CABLE MODEM NET - 822.560.283, mixed presentation;
o CABLE MODEM NET - 822.560.291, mixed presentation;
o CABLE MODEM NET - 822.560.305, mixed presentation;
o CABLEMODEMNET - 822.727.617, mixed presentation;
o CABLEMODEMNET - 822.727.625, mixed presentation;
o CABLEMODEMNET - 822.727.633, mixed presentation;
o BOLA NA NET - 820.587.621, mixed presentation, class 41.10/20/40;
o BOLA NA NET - 820.587.737, nominative presentation, class
41.10/20/40;
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