Licensed Book Publishing Agreement
Between
Disney Licensed Publishing
and
Golden Books Publishing Company, Inc.
Dated September 26, 1997
INDEX
Page
1. DEFINITIONS..................................................................................................1
1.1 "Licensed Property"................................................................................1
1.2 "Book".............................................................................................1
1.3 "Term".............................................................................................1
1.4 "Distribution Period"..............................................................................1
1.5 "Territory"........................................................................................1
1.6 "Royalties"........................................................................................1
1.7 "Royalty Payment Period"...........................................................................4
1.8 [Intentionally omitted pursuant to a confidential treatment request and
separately filed with the Commission]....................................................................4
1.9 "Guarantee"........................................................................................5
1.10 "Promotion Commitment"............................................................................6
1.11 "Affiliate".......................................................................................7
1.12 "Laws"............................................................................................7
1.13 "Suppliers".......................................................................................7
1.14 [Intentionally omitted pursuant to a confidential treatment request and
separately filed with the Commission]....................................................................8
2. GRANT OF RIGHTS..............................................................................................8
3. ADVANCE.....................................................................................................13
4. GUARANTEE...................................................................................................13
5. PUBLICATION, PRESS RUN & FREE COPIES........................................................................13
6. CONTENT.....................................................................................................14
7. PRE-PRODUCTION APPROVALS....................................................................................14
8. APPROVAL OF PRODUCTION SAMPLES..............................................................................16
9. THIRD PARTY APPROVALS.......................................................................................17
10. COMPLIANCE WITH APPLICABLE LAWS AND STANDARDS..............................................................18
11. PRINTING AND/OR MANUFACTURING BY THIRD PARTIES.............................................................21
12. ADVERTISING................................................................................................22
13. PROMOTION COMMITMENT.......................................................................................22
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14. COMMON MARKETING FUND......................................................................................23
15. OWNERSHIP..................................................................................................24
16. COPYRIGHT NOTICE...........................................................................................26
17. REGISTRATIONS..............................................................................................27
18. UNLICENSED USE OF LICENSED PROPERTY........................................................................27
19. WARRANTIES AND INDEMNITIES.................................................................................28
20. INSURANCE..................................................................................................30
21. STATEMENTS AND PAYMENT OF ROYALTIES........................................................................30
22. INTEREST...................................................................................................34
23. AUDITS AND MAINTAINING RECORDS.............................................................................34
24. WITHDRAWAL OF LICENSED MATERIAL............................................................................35
25. TERMINATION................................................................................................35
26. RIGHTS AND OBLIGATIONS UPON EXPIRATION OR TERMINATION......................................................37
27. NON-ASSIGNABILITY..........................................................................................39
28. NOTICES....................................................................................................42
29. MUSIC......................................................................................................43
30. GOODWILL...................................................................................................43
31. RELATIONSHIP...............................................................................................43
32. CONSTRUCTION...............................................................................................43
33. MODIFICATIONS OR EXTENSIONS OF THIS AGREEMENT..............................................................44
34. RESERVATION OF RIGHTS......................................................................................44
35. WAIVERS....................................................................................................44
36. SEVERABILITY...............................................................................................44
37. CHOICE OF LAW AND FORUM....................................................................................44
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38. EQUITABLE RELIEF...........................................................................................44
39. POWER TO SIGN..............................................................................................45
40. CONFIDENTIALITY............................................................................................45
41. PREVIOUS AGREEMENTS........................................................................................46
42. SURVIVAL OF OBLIGATIONS....................................................................................46
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LICENSED BOOK PUBLISHING AGREEMENT
This book publishing license agreement (the "Agreement") dated September 26,
1997, is made by and between Disney Book Publishing, Inc., doing business as
Disney Licensed Publishing ("Licensor") located at 000 X. Xxxxx Xxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxxxx 00000 and GOLDEN BOOKS PUBLISHING COMPANY, INC., A
WHOLLY-OWNED SUBSIDIARY OF GOLDEN BOOKS FAMILY ENTERTAINMENT, INC.
("Licensee") located at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, XX 00000.
1. DEFINITIONS
1.1 "LICENSED PROPERTY" means the characters set
forth in Schedule A, which is attached hereto and
incorporated herein by this reference. It is hereby mutually
acknowledged and agreed that the Licensed Property shall not
include any characters the publishing rights to which
Licensor does not own and that Licensee's use of the
Licensed Property is subject to Licensor's rights of
approval as more fully set forth in this Agreement.
1.2 "BOOK" means the book(s) described in Schedules B and
C, which are attached hereto and incorporated herein by this
reference, in the English language as developed by Licensee.
For purposes of this Agreement, the term "Book" shall not
include educational books or educational workbooks.
1.3 "TERM" means the period commencing October 1, 1997, and
ending December 31, 2001. Subject to Subparagraph 2.7 below,
the Term shall not be extended or continued beyond such
date, by implication or otherwise, than by a separate
written agreement newly entered into.
1.4 "DISTRIBUTION PERIOD" means the following period
during which the Book shall be distributed and available for
purchase in the distribution channels authorized pursuant to
Subparagraph 2.3 below: October 1, 1997 through the end of
the Term, and any extension thereof. Without limiting the
foregoing, Licensee agrees to use its best efforts to
distribute any Book the publication of which is tied to the
release (or re-release) in any medium (e.g., home video and
motion picture) of a Disney-branded feature animation or
live action movie on or about the official release date for
the overall licensing program established for that movie,
but in no event prior to such official release date.
1.5 "TERRITORY" means Canada, the United States, United
States PX's wherever located, and United States territories
and possessions, excluding Puerto Rico, Guam, Commonwealth
of Northern Mariana Islands and Palau.
1.6 "ROYALTIES" means a royalty in the amounts set forth below:
(i) The royalty rates set forth in Schedule C, which is
attached hereto and
Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
incorporated herein by this reference.
(ii) On sublicenses (all sublicenses are subject to
Licensor's prior written approval pursuant to
Subparagraph 27.4 below), Licensee shall pay
Licensor a royalty rate of [Intentionally omitted
pursuant to a confidential treatment request and
separately filed with the Commission] of Licensee's
Net Invoiced Xxxxxxxx for such sales of the Book;
(iii) For sales of the Book to book clubs, book fairs,
schools, libraries and other educational outlets
(all of which are subject to Licensor's prior
written approval) and "special" sales (i.e., sales
of the Book outside of the distribution channels
set forth herein for which Licensee must obtain
Licensor's prior written approval), a royalty rate
of [Intentionally omitted pursuant to a
confidential treatment request and separately filed
with the Commission] of Licensee's Net Invoiced
Xxxxxxxx if the sales are based on a sublicense
sale, or [Intentionally omitted pursuant to a
confidential treatment request and separately filed
with the Commission] of the applicable royalty rate
for sales made on an "inventory/all-in basis"
(i.e., when the Book is sold directly from
Licensee's inventory stock to the purchaser).
(iv) For sales of "Golden Value" versions of the Book,
for which Licensee must obtain Licensor's prior
written approval, a royalty rate of [Intentionally
omitted pursuant to a confidential treatment
request and separately filed with the Commission]
of the applicable royalty rate as set forth in
Schedule C hereto.
(v) "NET INVOICED XXXXXXXX" means the following: actual
invoiced xxxxxxxx (i.e., gross sales quantity
multiplied by Licensee's selling price) for copies
of the Book sold, and all other receivables of any
kind whatsoever, received in payment for the Book,
whether received by Licensee or any of Licensee's
Affiliates, except as provided in Subparagraph
1.6(vi) below, less "Allowable Deductions" as
hereinafter defined. The following are not part of
Net Invoiced Xxxxxxxx: invoiced charges for
transportation of the Book within the Territory
which are separately identified on the sales
invoice, and sales taxes.
(vi) "ALLOWABLE DEDUCTIONS" means the following: volume
discounts, and other discounts from the invoice
price (or post-invoice credits) unilaterally
imposed in the regular course of business by
Licensee's customers, so long as Licensee documents
such discounts (or credits) to Licensor's
satisfaction. In the event a documented unilateral
discount (or credit) is taken with respect to
combined sales of the Book and other products not
licensed by Licensor, and Licensee cannot document
the portion of the discount (or credit) applicable
to the Book, Licensee may apply only a pro
Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
rata portion of the discount (or credit) to the
Book. Unilateral discounts or credits are never
deductible if they represent items listed
hereinbelow.
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Without limiting the generality of the
foregoing, the following are not Allowable
Deductions, whether granted on sales invoices or
unilaterally imposed as discounts or as
post-invoice credits: cash discounts granted as
terms of payment; early payment discounts;
allowances or discounts relating to advertising;
costs incurred in manufacturing, importing, selling
or advertising the Book; freight costs incorporated
in the selling price; and uncollectible accounts.
Commencing on October 1, 1998, the following are
not Allowable Deductions: xxxx down allowances, new
store allowances, defective goods allowances or
allowances taken by customers in lieu of returning
goods.
(vii) Notwithstanding anything in this Agreement to the
contrary, during the period commencing October 1,
1997 through December 31, 1997, Licensee shall pay
royalties for sales of the Book based on the
royalty rates set forth in Paragraph 3 of that
certain Publishing License between Western
Publishing Company, Inc. and The Disney Publishing
Group dated October 23, 1992 (the "1992 Publishing
License Agreement"). Effective as of January 1,
1998, Licensee shall pay Royalties for sales of the
Book based on the royalty rates set forth in this
Subparagraph 1.6. Similarly, notwithstanding
anything in this Agreement to the contrary, during
the period commencing October 1, 1997 through
December 31, 1997, Licensee shall pay royalties for
sales of the Magic Slate(R) products licensed
pursuant to that certain agreement between Western
Publishing Group, Inc. and Disney Licensed
Publishing dated February 16, 1995, as amended,
pursuant to the royalty rates set forth in
Subparagraph 1.G. of that agreement.
(viii) No Royalties will be payable on copies of the Book
that are provided gratis for review, promotion,
advertising, sample, or similar purposes intended
to promote the Book, which copies are not intended
for sale, up to a maximum of five hundred (500)
copies of each title of the Book. In addition, no
Royalties will be payable on free copies provided
to Licensor pursuant to Subparagraph 5.3 of this
Agreement.
(ix) It is intended that the royalty on sales of the
Book covered by Subparagraphs 1.6 (ii), (iii), and
(iv) above which require the approval of Licensor
shall be agreed in writing when such sale is
approved. If it is not so agreed in writing, the
royalty payable shall be the same as would be
payable if the Book had been sold through the
distribution channels authorized in Subparagraph
2.3 below. Licensee shall submit all requests for
approval for proposed sales of the Book covered by
Subparagraphs 1.6(ii), (iii), and (iv) to the
Vice-President of Disney Licensed Publishing
(or his or her designee) on the form attached
hereto as Exhibit 5, which
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form may change from time to time. Licensor shall
endeavor to indicate its approval or disapproval of
such requests in a timely manner, but such approvals
should be sought as early as possible.
(x) With respect to copies of the Book sold in Canada,
the foregoing Royalties shall be computed based on
the corresponding price of the Book as sold in the
United States.
(xi) Royalties reported on sales of the Book which have
been returned to Licensee for credit or refund and
on which a refund has been made or credit memo
issued may be credited against Royalties due. The
credit shall be taken in the Royalty Payment Period
in which the refund is given or credit memo issued.
Unused credits may be carried forward, but in no
event shall Licensee be entitled to a refund of
Royalties.
1.7 "ROYALTY PAYMENT PERIOD" means each calendar monthly period
during the Term, and during the Sell-off Period, if any.
1.8 [Intentionally omitted pursuant to a confidential treatment
request and separately filed with the Commission].
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1.9 "GUARANTEE" means the following sum(s) which Licensee agrees
and guarantees to pay Licensor as minimum Royalties on sales
of the Book for the following periods during the Term:
(i) Seven million three hundred seventy thousand United
States Dollars (U.S. $7,370,000.00) for the period
commencing January 1, 1998, and ending September
30, 1998; and
(ii) Eleven million six hundred seventy thousand United
States Dollars (U.S. $11,670,000.00) for the period
commencing October 1, 1998, and ending September
30, 1999; and
(iii) Thirteen million three hundred forty thousand
United States Dollars (U.S. $13,340,000.00) for the
period commencing October 1, 1999, and ending
September 30, 2000; and
(iv) Fifteen million three hundred forty thousand United
States Dollars (U.S. $15,340,000.00) for the period
commencing October 1, 2000, and ending September
30, 2001; and five million two hundred eighty
thousand United States Dollars (U.S. $5,280,000.00)
for the period commencing October 1, 2001, and
ending December 31, 2001, unless the Term of the
Agreement is extended pursuant to Subparagraph 2.7
below; and
(v) In the event the Term of the Agreement is extended
pursuant to Subparagraph 2.7 below, sixteen million
six hundred seventy thousand United States Dollars
(U.S. $16,670,000.00) for the period commencing
October 1, 2001, and ending September 30, 2002; and
(vi) In the event the Term of the Agreement is extended
pursuant to Subparagraph 2.7 below, five million
six hundred ten thousand United
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States Dollars (U.S. $5,610,000.00) for the period
commencing October 1, 2002, and ending December 31,
2002.
Licensee may apply Royalties earned from sales of the Book
(i.e., any authorized format utilizing any Licensed
Property) towards meeting the respective Guarantees set
forth hereinabove. However, any Royalties earned which
exceed the Guarantee amount for one Guarantee period may not
be applied towards meeting the Guarantee for any other
Guarantee period. Notwithstanding anything in this Agreement
to the contrary, if the Term of this Agreement is extended
pursuant to Subparagraph 2.7 below, Licensee may apply
Royalties earned which exceed the Guarantee for the period
October 1, 2001, and ending September 30, 2002 towards
meeting the Guarantee for the period October 1, 2002, and
ending December 31, 2002. If the Term is not extended,
Licensee may apply Royalties earned which exceed the
Guarantee for the period October 1, 2000, and ending
September 30, 2001 towards meeting the Guarantee for the
period October 1, 2001, and ending December 31, 2001.
1.10 "PROMOTION COMMITMENT" means the following promotional and
marketing support which Licensee agrees to provide for the
Book:
(i) Licensee shall include the Book in its catalog, if
any, in accordance with the following: the catalogs
shall have a separate page or pages showing all new
formats and titles. The Book shall in addition to
being included in the main index of the catalog be
separately indexed in an index listing all formats
and titles of the Book. All such catalog pages are
subject to Licensor's prior written approval.
(ii) Licensee shall make available point-of-purchase
marketing support materials for all new theatrical
and video releases and, as it deems appropriate,
for Disney-animated television programs and brand
programs covered by the Book. All such marketing
support materials are subject to Licensor's prior
written approval.
(iii) Licensee shall endeavor to conduct two (2) major
Territory-wide in-store marketing promotions for
any of the character(s) included in the Licensed
Property, at Licensee's sole discretion, during
each year of the Term, and any extension thereof,
and Licensor will contribute without charge
creative and marketing direction assistance for
such annual promotions.
Notwithstanding the foregoing, Licensee
acknowledges the importance to Licensor of
supporting the Disney-animated feature releases.
All such promotions are subject to Licensor's prior
written approval.
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(iv) Twice each calendar year, Licensee agrees to
provide Licensor with a detailed sales, marketing,
and creative program (the "Program") specifying how
Licensee intends to support and promote each of the
character classes in the Licensed Property (i.e.,
the "A" , "B" and "C" Properties as set forth in
Schedule A hereto) in a manner and at a level
commensurate with (a) the extensive publishing
rights granted to Licensee hereunder, and (b)
Licensee's status as Licensor's principal licensed
publisher for the Book. Licensee shall use its best
efforts to implement the Program presented to
Licensor, with the goal of meeting Licensor's
expectation and intention that Licensee will
actively and mutually support each of the character
classes in the Licensed Property in approximately
the following ratios: [Intentionally omitted
pursuant to a confidential treatment request and
separately filed with the Commission]. License
shall provide Licensor with complete copies of all
materials utilized in presenting the Program.
(v) All requests for approval required under this
Subparagraph 1.10 shall be sought by Licensee as
early as possible and should include all
information necessary to allow Licensor to make an
informed decision. Licensor shall endeavor to
indicate its approval or disapproval of such
requests in a timely manner.
1.11 "AFFILIATE" means, with regard to Licensee, any corporation
or other entity which directly or indirectly controls, is
controlled by, or is under common control with Licensee; with
regard to Licensor, "Affiliate" means any corporation or
other entity which directly or indirectly controls, or is
controlled by, or is under common control with, Disney
Enterprises, Inc. "Control" of an entity shall mean
possession, directly or indirectly, of power to direct
or cause the direction of management or policies of such
entity, whether through ownership of voting securities, by
contract or otherwise.
1.12 "LAWS" means any and all applicable laws, rules, and
regulations, including but not limited to, local and
national laws, rules and regulations, treaties, voluntary
industry standards, association laws, codes or other
obligations pertaining to any of Licensee's activities under
this Agreement, including but not limited to those
applicable to the manufacture, pricing, sales and/or
distribution of the Book.
1.13 "SUPPLIERS" means any of Licensee's third-party manufacturers
and suppliers (and their sub-manufacturers and suppliers)
which reproduce or use the Licensed Property in the Book, or
components of the Book, and/or which assemble the Book.
-7-
1.14 [Intentionally omitted pursuant to a confidential treatment
request and separately filed with the Commission].
2. GRANT OF RIGHTS
2.1 Subject to the terms and conditions of this Agreement, and
in consideration for Licensee's promise to pay and
Licensee's payment of all Royalties, Fees, Advances,
Guarantees, and Common Marketing Fund payments required
hereunder, Licensor hereby grants to Licensee, during the
Term, the non-exclusive right throughout the Territory, to
create, print, bind, market, advertise, publish, and sell
the English language version(s) of the Book. Licensee shall
have the right to publish Licensee's existing backlist of
"Sturdy Shape" titles of the Book, plus up to six (6) new
"Sturdy Shape" versions of the Book per each year of the
Term; provided, however, that no "Sturdy Shape" versions of
the Book (including backlist titles) may utilize the
Licensed Property "WINNIE THE POOH". For purposes of the
preceding sentence, "backlist titles" shall include all
"Sturdy Shape" titles being published by Licensee as of the
date of this Agreement. The Licensed Property shall include
Licensee's backlist of titles to the Book; provided,
however, that prior to such publication, Licensor shall have
the opportunity to review the backlist and may require
Licensee to update the artwork and/or any other creative
aspects of the Book (including, but not limited to, the
interior art and covers) so as to be fresh and current, to
conform to all new or updated publishing reference material
guidelines, to comply with any material changes in character
art styles or standards introduced by Licensor, to conform
with all material branding initiatives of Licensor, or to
maintain all art quality standards as required by Licensor,
to be determined solely at Licensor's discretion, so long as
such creative aspect(s) of the Book were not previously
approved by Licensor within the preceding twenty-four (24)
months. During the first twelve (12) months of the Term, the
parties hereby agree to conduct a review of the backlist of
those titles of the Book which Licensee intends to seek
approval for publication pursuant to this Agreement.
Licensor shall not unreasonably withhold its approval of
backlist titles submitted by Licensee. Notwithstanding the
foregoing, Licensee may continue to publish those backlist
titles or group
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of backlist titles which Licensee is actively publishing as
of the date of this Agreement until such time as Licensor
notifies Licensee of its desire to exercise the approval
rights set forth hereinabove with respect to a title or
group of titles.
2.2 Notwithstanding that this Agreement is non-exclusive,
Licensee shall be the principal licensed publisher for the
Book. The parties recognize that Licensee's status as
principal licensed publisher for the Book gives rise to
certain mutual responsibilities commensurate with the
financial commitment being made by Licensee and the scope of
properties being licensed by Licensor under this Agreement.
On Licensee's part, principal licensed publisher means that,
during the Term, Licensee agrees to exercise actively the
rights granted hereunder, to use its best efforts to maximize
sales of the Book in the Territory during the Term (or any
renewal thereof), and to support the Licensed Property and
each of the properties contained therein in a focused,
substantive, and meaningful way, but at a minimum, not less
than as set forth in Subparagraph 1.10 above. Further,
Licensee agrees that if Licensee (or any Publishing Affiliate
of Licensee) enters into another license agreement for any
other major animated or live action motion picture which is
anticipated to be a significant media event with high-profile
promotional, advertising, and marketing campaigns, and the
term of such license agreement overlaps with the Term (or any
extension thereof) of this Agreement, Licensee shall use its
best efforts to ensure that Licensee's commitment to the
Licensed Property is not adversely impacted and that the
Licensed Property receives the appropriate priority. On
Licensor's part, principal licensed publisher means that,
during the Term, [Intentionally omitted pursuant to a
confidential treatment request and separately filed with the
Commission].
Further, and notwithstanding that this Agreement is
non-exclusive, and provided that Licensee has satisfactorily
performed the terms and conditions of this Agreement, and
paid all sums due Licensor hereunder, Licensee shall have
the right of first refusal, during the Term to publish in
the English language in the Territory,
-9-
[Intentionally omitted pursuant to a confidential treatment
request and separately filed with the Commission]. Licensee's
right of first refusal does not extend to any product which,
in whole or in part, falls outside of Licensor's customary
licensed publishing business, which is published, manufactured
or licensed or being published, manufactured or licensed by
Licensor's Affiliates or which is part of a promotional
license agreement between Licensor or its Affiliates and a
third-party promotion partner. Without limiting the
generality of item 1(c) above in this paragraph,
[Intentionally omitted pursuant to a confidential treatment
request and separately filed with the Commission].
Licensor will notify Licensee in writing, if Licensor, in
its absolute discretion, determines to license such
additional book formats. If Licensee fails to notify
Licensor in writing of its election to exercise this right
of first refusal for any given format submitted to Licensee
for consideration within thirty (30) days from the date upon
which Licensor notifies Licensee of such format, or if the
parties are unable to agree upon any material terms or
conditions specific to such format after attempting in good
faith to do so within thirty (30) days after Licensee
notifies Licensor of its intent to exercise its right of
first refusal, Licensor shall have the full right to license
a third party to publish the new formats without further
obligation to Licensee. For purposes of clarity, any books
licensed to Licensee by Licensor under this right of first
refusal shall be subject to a separate written agreement to
be mutually negotiated by the parties, and shall not be
included within the meaning of "Book" under this Agreement
and shall not apply towards meeting Licensee's Advance and
Guarantee obligations under this Agreement. Further,
Licensor shall not be obligated to offer to Licensee, as
part of Licensee's right of first refusal, any color and
activity or storybook concepts or ideas to the extent such
disclosure violates any applicable Laws, professional
obligations customary in the publishing industry, and/or,
based on a reasonable and good faith determination by
Licensor, constitutes confidential proprietary information
or trade secrets of Licensor or a third party.
2.3 The Book may be sold only to department stores, gift stores,
specialty retail stores, mass market stores, discount stores,
supermarkets, drug stores, convenience stores, toy stores,
airport stores, warehouse clubs, major and independent
book stores and book store chains, wholesalers and jobbers,
and book wholesalers and jobbers who may sell to schools,
libraries and other educational outlets. If there is a
question as to whether a particular customer falls within any
of the categories specified above, Licensor's determination
shall be binding. Licensee may not sell the Book to retailers
that sell the Book on a duty-free basis, or to wholesalers
for resale to such retailers, unless such retailer or
wholesaler has
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a then-current license agreement with Licensor or an Affiliate
of Licensor permitting it to make such duty-free sales. In
addition, the Book may not be sold by direct marketing
methods, which include, but are not limited to, computer
on-line selling, home shopping television programs, direct
mail and door-to-door solicitation. Licensee shall make all
solicitations, sales and collections solely in its own name
and in accordance with all applicable Laws. Licensee agrees
not to sell the Book, including any part or adaptation
thereof, otherwise than as herein provided without
Licensor's prior written approval.
2.4 The Book shall not be used or sold to others for use as a
giveaway, fundraiser, or to customers for inclusion in
another product, or for lotteries, premiums, promotions,
sweepstakes, or advertising purposes in connection with
other publications or articles, or to sell other products,
without the prior written consent of Licensor.
2.5 The prohibition of computer on-line selling referenced in
Subparagraph 2.3 above includes, but is not limited to, the
display, promotion or offering of the Book in or on any
on-line venues (e.g. Websites), except as specifically
permitted in the following two sentences. With Licensor's
prior written permission, the Book approved by Licensor may
be displayed and promoted on Disney-controlled on-line
venues, only within the Territory. Licensee may sell the
Book to retailers, within the channels of distribution
authorized pursuant to Subparagraph 2.3, who sell the Book
in or on such retailer's own Website. In the event any such
retailer is displaying and/or selling the Book in an
unauthorized manner, Licensee agrees to cooperate with
Licensor in Licensor's efforts to prohibit such unauthorized
activity.
2.6 Licensee recognizes and acknowledges the vital importance to
Licensor of the characters and other proprietary material
owned and created by The Xxxx Disney Company and its
Affiliates (collectively referred to herein as "Disney") and
the association of the Disney name with them. In order to
prevent the denigration of Disney's products and the value
of their association with the Disney name, and in order to
ensure the dedication of Licensee's best efforts to preserve
and maintain that value, Licensee agrees that, during the
Term and any extension thereof, Licensee will neither itself
manufacture, advertise, promote, merchandise, display,
package, sell and/or distribute (nor permit any sublicensee,
distributor or other person or entity to do so) (a) any
non-Disney product, in such a manner as to imply an
association with Disney and/or its proprietary material,
(b) any published product which contains any artwork or other
representation not owned by Disney, but which Licensor
determines, in its reasonable discretion, is confusingly
similar to Disney characters or other Disney proprietary
material, (c) any book which contains any non-Disney owned
images of a character for which there is a Disney-owned
image, or (d) any product containing material which
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Licensor determines, in its sole discretion, is lewd,
lascivious, obscene, offensive, defamatory or otherwise
injurious to Disney or the Disney name, business, products,
or proprietary material. [Intentionally omitted pursuant to a
confidential treatment request and separately filed with the
Commission].
2.7 Provided that Licensee has complied with all terms and
conditions of this Agreement, including without limitation
Subparagraph 1.10(iv) above, and Licensee has met its
Guarantee obligation, as set forth in Subparagraph 1.9
above, for the period commencing October 1, 1999, and ending
September 30, 2000, this Agreement shall renew for an
additional twelve (12) month period commencing on January 1,
2002, and ending December 31, 2002.
2.8 Licensor may during the Term of this Agreement determine to
license a new category of educational workbooks. In the
event Licensor agrees to do so, prior to licensing the
publication of such books, Licensor shall provide Licensee
with the opportunity to present proposals to become a
licensed publisher for this new product category . For
purposes of clarity, any educational workbooks licensed to
Licensee by Licensor under this Subparagraph shall be
subject to a separate written agreement to be mutually
negotiated by the parties, and shall not be included within
the meaning of "Book" under this Agreement and shall not
apply towards meeting Licensee's Advance and Guarantee
obligations under this Agreement.
2.9 As further consideration for the licensing rights granted to
Licensee hereunder, Licensee shall issue to Licensor a
Warrant granting Licensor the right to purchase the number
of shares of common stock in Golden Books Family
Entertainment, Inc., specified in that certain Warrant
Agreement of even date herewith (the "Warrant Agreement"),
to be executed by Licensor and Licensee contemporaneously
with the execution of this Agreement.
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Golden books Publishing Company, Inc.
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3. ADVANCE
3.1 Licensee agrees to pay to Licensor the Advance, which shall
be on account of Royalties accruing during the Term only,
and only with respect to sales in the Territory; provided,
however, that if any part of the Advance is specified in
Subparagraph 1.8 above as applying to any period less than
the Term, such part shall be on account of Royalties
accruing during such lesser period only. If said Royalties
should be less than the Advance, no part of the Advance
shall be refundable.
3.2 Royalties accruing during the Sell-off Period, if any, or
any extension of the Term shall not be offset against the
Advance, unless otherwise agreed in writing. Subject to
Subparagraph 1.9 above, Royalties accruing during any
extension of the Term or any other term shall be offset only
against an advance paid with respect to such extended term.
4. GUARANTEE
4.1 Licensee shall, with Licensee's statement of account for the
last Royalty Payment Period of each Guarantee period set
forth in Subparagraph 1.9 above, pay Licensor the amount, if
any, by which Royalties paid with respect to sales in the
Territory during the Guarantee period fall short of the
amount of the Guarantee for that period. In addition,
Licensee shall, with Licensee's statement of account for the
last Royalty Payment Period of the Term, or immediately upon
termination if the Agreement is terminated prior to the
expiration of the Term, pay Licensor the amount, if any, by
which Royalties paid with respect to sales in the Territory
during the Term fall short of the amount of the cumulative
Guarantee.
4.2 Advances, if any, applicable to Royalties due on sales in
the period to which the Guarantee relates shall apply
towards meeting the respective Guarantees for those periods
set forth in Subparagraph 1.9.
5. PUBLICATION, PRESS RUN & FREE COPIES
5.1 Licensee agrees to exercise actively the rights granted
herein. Licensee shall publish the Book and shall keep a
sufficient quantity and selection of titles of the Book in
print and available for purchase in the distribution
channels authorized pursuant to Subparagraph 2.3 above,
during the Term of this Agreement, in order to, at a
minimum, comply with Licensee's obligations as set forth in
Subparagraphs 1.10 and 2.2 above. Licensee shall notify
Licensor in writing of the publication date(s) of the Book
ninety (90) days prior to such publication date(s).
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
5.2 Licensee agrees to print a minimum number of copies of the
Book during the Term sufficient to meet the requirements of
the Program.
5.3 Licensee agrees to furnish to Licensor, free of charge, one
hundred (100) copies of each title of the Book from the
first shipment of the Book, and to sell to Licensor at fifty
percent (50%) below the published retail price any
reasonable quantities of additional copies which Licensor
requires for purposes other than resale; provided, however,
that if Licensor desires to purchase more than five hundred
(500) copies of any title of the Book, Licensor shall advise
Licensee of the reasons for such purchase. Licensor agrees
not to purchase more than five hundred (500) copies of any
title of the Book solely for purposes of giving away such
copies to the public for free, without Licensee's prior
written consent. Two (2) of the free copies shall be delivered
by Licensee directly to Licensor's legal department for
copyright registration purposes, attention Copyright
Paralegal, The Xxxx Disney Company, 000 Xxxxx Xxxxx Xxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxxxx 00000-0000.
6. CONTENT
All creative costs for the Book shall be borne by Licensee.
Notwithstanding the foregoing, Licensor agrees to cooperate with
Licensee in the preparation of the artwork and text for the Book. To
that end, Licensor agrees to make a good faith attempt to provide
Licensee such pre-existing artwork, textual, reproduction materials,
and reference materials in Licensor's possession as may be available
and which Licensor and Licensee deem suitable for inclusion in the
Book. Licensee acknowledges that Licensor may charge Licensee for the
cost of the foregoing materials or other costs incurred in connection
with the preparation of the Book. Licensor shall make reasonable,
good faith attempts to provide Licensee with prior notice of any such
charges, including the estimated amounts thereof. Estimates of the
charges for such materials are available upon request.
7. PRE-PRODUCTION APPROVALS
7.1 All aspects of the Book and its contents (the "Materials"),
including without limitation, concepts, format and size,
quality of paper, textual, artistic and photographic
content, printing, cover, notices (e.g., copyright,
trademark, logos), dust jacket (if any), slip case (if any),
audio elements (if any), non-printed components (e.g., PVCs,
toys) (if any), and title, shall be subject to Licensor's
prior review and written approval. Approval or disapproval
of the Materials shall lie in Licensor's sole discretion.
Licensee shall endeavor to submit the Materials and requests
for approval or other action by Licensor early enough to
avoid unnecessary time pressure on Licensor. Requests for
approvals of the Materials must be accompanied by an
approval form provided by Licensor. Licensor shall
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
indicate the reasons for disapprovals and the changes needed
to obtain approval. Any approval Licensor may give will not
constitute or imply a representation or belief by Licensor
that such materials comply with any applicable Laws. Without
limiting Licensor's right to approve the Materials under
this Subparagraph 7.1, Licensor hereby recognizes and
acknowledges that Licensor's timely processing of the
Materials is important to Licensee's ability to perform its
obligations under this Agreement. Licensee hereby recognizes
and acknowledges that Licensor's ability to process the
Materials is often dependent on, and subject to, extenuating
factors, including, but not limited to, when Licensee
submits materials, the quality of the materials submitted,
the volume of materials submitted (including by other
licensees), and the need or requirement for Licensor to
consult with third parties to obtain certain approvals. In
order to facilitate and expedite the process of submitting
and approving the Materials so as to meet the concerns of
both parties, Licensor and Licensee hereby agree that,
immediately upon the execution of this Agreement, each party
shall designate a representative to draft a set of detailed
written artwork submission and approval policies and
guidelines (the "Policy"). The Policy shall be in place on or
before January 1, 1998. Licensor and Licensee shall
periodically review and, as necessary, revise the Policy to
ensure it is properly functioning. Licensor and Licensee
shall also give priority to establishing computer links to
facilitate and improve upon the submission and approval of
the Materials.
7.2 Subject to the provisions set forth in the Policy, as early
as possible, and in any case before commercial production of
the Book, Licensee shall submit to Licensor for Licensor's
review and written approval all aspects of the Book, at each
stage of creation, including, but not limited to, any
concepts (covers and interiors), story outlines, layouts,
rough pencils, tight pencils, final art, mechanicals,
pre-press proofs (digital proof for mechanicals plus a film
proof), manuscript drafts, finished manuscripts and sample
of paper stock and sound/electronics (if any), and shall
supply from the first print run, and each subsequent print
run, samples for Licensor's written approval. Licensee shall
ensure that each copy thereafter printed shall conform in
all respects to what has been approved by Licensor and shall
not ship or deliver copies of the Book which do not so
conform. If any nonconforming Book is sold by Licensee,
Licensor may, in addition to any other remedies available to
Licensor (including, but not limited to, termination of this
Agreement), by written notice require such Book to be
immediately withdrawn from the market. Licensee acknowledges
that Licensor may not approve concepts or artwork submitted
near the end of the Term. Licensee further acknowledges that
the fact that artwork has been created by an artist
recommended by Licensor or by an artist who has worked in
the past on a Disney publication does not mean that any such
artwork will necessarily be approved in connection with the
Book licensed hereunder.
-15-
8. APPROVAL OF PRODUCTION SAMPLES
8.1 Before shipping the Book to any customer, Licensee agrees to
furnish to Licensor, from the first production run of each
supplier of the Book, for Licensor's approval of all aspects
thereof, samples, with packaging, if any, which shall
conform to the approved pre-production samples. Approval or
disapproval of the artwork as it appears in the Book, as
well as of the quality of the Book, shall lie in Licensor's
sole discretion and may, among other things, be based on
unacceptable quality of the artwork or of any part of the
Book as manufactured. Any part not so approved shall be
deemed unlicensed, shall not be sold and, unless otherwise
agreed by Licensor in writing, shall be destroyed. Such
destruction shall be attested to in a certificate signed by
one of Licensee's officers. Production samples of the Book
for which Licensor has approved a pre-production sample shall
be deemed approved, unless within twenty (20) days of
Licensor's receipt of such production sample Licensor
notifies Licensee to the contrary. Any approval of a
production sample attributable to Licensor shall not
constitute or imply a representation or belief by Licensor
that such production sample complies with applicable Laws.
8.2 Licensee agrees to make available at no charge such
additional samples of the Book as Licensor may from time to
time reasonably request for the purpose of comparison with
earlier samples or for Licensor's anti-piracy efforts, or to
test for compliance with applicable Laws, and to permit
Licensor to inspect Licensee's manufacturing operations and
testing records (and those of Licensee's Suppliers) of the
Book.
8.3 Licensee acknowledges that Licensor may disapprove any part
of the Book or a production run of the Book because the
quality is unacceptable to Licensor, and accordingly,
Licensor recommends that Licensee submit production samples
to Licensor for approval before committing to a large
original production run or to purchase a large shipment from
a new supplier.
8.4 No modification of an approved production sample shall be
made without Licensor's further prior written approval. The
Book must conform in all respects to the approved production
samples. It is understood that if in Licensor's reasonable
judgment the quality of the Book as originally approved has
deteriorated in later production runs, or if the Book has
otherwise been altered, Licensor may, in addition to other
remedies available to Licensor, by written notice require
such Books to be withdrawn immediately from the market.
8.5 Any part of the Book not meeting the standard of approved
samples shall be destroyed or all Licensed Property shall be
removed or obliterated therefrom.
-16-
8.6 Licensee is responsible for the consistent quality and
safety of the Book and its compliance with applicable Laws,
Licensor will not unreasonably object to any change in the
design of the Book or in the materials used in the
manufacture of the Book or in the process of manufacturing
the Book which Licensee advises Licensor in writing is
intended to make the Book safer or more durable.
8.7 Licensor shall have the right, by written notice to
Licensee, to require modification of any part of the Book
approved by Licensor under this or any previous agreement
between Licensee and Licensor pertaining to the Licensed
Property. Likewise, if the Term of this Agreement is
extended by mutual agreement, or pursuant to Subparagraph
2.7, Licensor shall have the right, by written notice to
Licensee, to require modification of any part of the Book
approved by Licensor under this Agreement. It is understood
that there is no obligation upon either party to extend the
Agreement, except as may be provided in Subparagraph 2.7.
8.8 If Licensor notifies Licensee of a required modification
under Subparagraph 8.7 above, such notification shall advise
Licensee of the nature of the changes required. If the
required modification is material to the integrity of the
Book, the Licensed Property in the Book, and/or the Disney
Property (as defined below), then Licensee shall not accept
any order for the Book until it has been resubmitted to
Licensor with such changes and Licensee has received
Licensor's written approval of the Book as modified.
However, Licensee may continue to distribute Licensee's
inventory of the previously approved Book until such
inventory has been exhausted (unless the Book is dangerously
defective, as determined by Licensor.
8.9 Without limiting Licensor's approval rights under this
Paragraph 8, the Policy referenced in Subparagraph 7.1 shall
include provisions governing all submissions and approvals
which are the subject of this Paragraph 8.
9. THIRD PARTY APPROVALS
9.1 No material which is owned by a third party or in which a
third party has rights shall be embodied in the Book or used
in conjunction with the Book, unless Licensor has given
knowing prior approval in writing, such approval to be
granted or withheld within Licensor's sole discretion. In
the event that Licensor does so approve, Licensee shall
obtain all necessary licenses (and all other licenses
required by Licensor) for the use of such material
(including but not limited to all audio elements, if any) in
or in conjunction with the Book.
9.2 Except with respect to material supplied by Licensor,
Licensee shall pay and be solely responsible for the payment
of all obligations to third parties arising from the
manufacture, distribution, advertising and sale of the Book,
including, but not
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
limited to, payments to designers, printers, recording
artists, musicians and applicable unions and guilds, and
shall pay or cause to be paid to the copyright proprietors
of the material referenced in Subparagraph 9.1 above, or to
their duly authorized agents, all royalties and other sums
(including the full statutory mechanical royalty rate if
required for audio material) which may become due under and
in accordance with said licenses and all applicable Laws.
9.3 Licensee understands that Licensor's interim and final
approvals or disapprovals of the Book or any part of the
contents of the Book may depend on whether necessary
permissions from third parties have been obtained.
10. COMPLIANCE WITH APPLICABLE LAWS AND STANDARDS
10.1 Licensee covenants that the Book and any component thereof
distributed hereunder shall be of good quality and free of
defects in design, materials and workmanship, and shall
comply with all applicable Laws, and such specifications, if
any, as may have been specified in connection with this
Agreement and shall conform to the sample thereof approved
by Licensor. Licensee covenants that it will comply with all
applicable Laws in performing this Agreement, including but
not limited to, those pertaining to the manufacture,
pricing, sale and distribution of the Book.
10.2 Without limiting the foregoing, Licensee covenants on behalf
of Licensee's own company, and agrees to require all
Suppliers to covenant by signing the Supplier's Agreement
(referenced in Paragraph 11 below), as follows:
(i) Licensee and the Suppliers agree not to use child
labor in the manufacturing, packaging or
distribution of the Book. The term "child" refers
to a person younger than the local legal minimum
age for employment or the age for completing
compulsory education, but in no case shall any
child younger than fifteen (15) years of age (or
fourteen (14) years of age where local law allows)
be employed in the manufacturing, packaging or
distribution of the Book. Licensee and the
Suppliers employing young persons who do not fall
within the definition of "children" agree also to
comply with any Laws applicable to such persons.
(ii) Licensee and the Suppliers agree only to employ
persons whose presence is voluntary. Licensee and
the Suppliers agree not to use any forced or
involuntary labor, whether prison, bonded,
indentured or otherwise.
(iii) Licensee and the Suppliers agree to treat each
employee with dignity and respect, and not to use
corporal punishment, threats of violence, or other
forms of physical, sexual, psychological or verbal
harassment or abuse.
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
(iv) Licensee and the Suppliers agree not to
discriminate in hiring and employment practices,
including salary, benefits, advancement,
discipline, termination, or retirement, on the
basis of race, religion, age, nationality, social
or ethnic origin, sexual orientation, gender,
political opinion or disability.
(v) Licensee and the Suppliers recognize that wages are
essential to meeting employees' basic needs.
Licensee and the Suppliers agree to comply, at a
minimum, with all applicable wage and hour Laws,
including minimum wage, overtime, maximum hours,
piece rates and other elements of compensation, and
to provide legally mandated benefits. If local Laws
do not provide for overtime pay, Licensee and the
Suppliers agree to pay at least regular wages for
overtime work. Except in extraordinary business
circumstances, Licensee and the Suppliers will not
require employees to work more than the lesser of (a)
48 hours per week and 12 hours overtime or (b) the
limits on regular and overtime hours allowed by local
law, or, where local law does not limit the hours of
work, the regular work week in such country plus 12
hours overtime. In addition, except in extraordinary
business circumstances, employees will be entitled
to at least one day off in every seven-day period.
Licensee and the Suppliers agree that, where local
industry standards are higher than applicable legal
requirements, they will meet the higher standards.
(vi) Licensee and the Suppliers agree to provide
employees with a safe and healthy workplace in
compliance with all applicable Laws, ensuring, at a
minimum, reasonable access to potable water and
sanitary facilities, fire safety and adequate
lighting and ventilation. Licensee and the
Suppliers also agree to ensure that the same
standards of health and safety are applied in any
housing they provide for employees. Licensee and
the Suppliers agree to provide Licensor with all
information Licensor may request about
manufacturing, packaging and distribution
facilities for the Book.
(vii) Licensee and the Suppliers agree to respect the
rights of employees to associate, organize and
bargain collectively in a lawful and peaceful
manner, without penalty or interference, in
accordance with applicable Laws.
(viii) Licensee and the Suppliers agree to comply with all
applicable environmental Laws.
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
(ix) Licensee and the Suppliers agree to comply with all
applicable Laws, including those pertaining to the
manufacture, pricing, sale and distribution of the
Book.
(x) Licensee and the Suppliers agree that Licensor and
its designated agents (including third parties) may
engage in monitoring activities to confirm
compliance with this Paragraph 10, including
unannounced on-site inspections of manufacturing,
packaging and distribution facilities, and
employer-provided housing, such inspections to
include reviews of books and records relating to
employment matters and private interviews with
employees. Licensee and the Suppliers agree to
maintain on site all documentation necessary to
demonstrate compliance with this Paragraph 10.
Licensee agrees to promptly reimburse Disney for
the actual costs of inspections performed pursuant
to this Paragraph 10 when any of Licensee's
manufacturing facilities or any Suppliers do not
pass the inspection(s).
(xi) Licensee and the Suppliers agree to take
appropriate steps to ensure that the provisions of
this code of conduct (the "Code of Conduct") are
communicated to employees, including the prominent
posting of a copy of the Code of Conduct for
Suppliers and Licensees, (copies of which are
attached hereto as Exhibits 3 and 4, respectively),
as may be applicable, in the local language and in
a place readily accessible to employees at all
times.
10.3 Licensee agrees to take appropriate steps, in consultation
with Licensor, to develop, implement and maintain procedures
to evaluate and monitor the Suppliers it uses to manufacture
the Book or any components thereof, and to ensure compliance
with this Paragraph 10, including but not limited to,
unannounced on-site inspections of manufacturing, packaging
and distribution facilities and employer-provided housing,
reviews of books and records relating to employment matters
and private interviews with employees.
10.4 Both before and after Licensee puts the Book on the market,
Licensee shall follow reasonable and proper procedures for
testing that the Book complies with all applicable product
safety Laws, and shall permit Licensor's designees to
inspect testing, manufacturing and quality control records
and procedures and to test the Book for compliance with
product safety and other applicable Laws. Licensee agrees to
promptly reimburse Licensor for the actual costs of such
testing if the Book fails to comply with such Laws. Licensee
shall also give due consideration to any recommendations by
Licensor that the Book exceeds the requirements of
applicable Laws. Books not manufactured, packaged or
distributed in accordance with applicable Laws shall be
deemed unapproved, even if previously approved
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
by Licensor, and shall not be shipped unless and until they
have been brought into full compliance therewith.
11. PRINTING AND/OR MANUFACTURING BY THIRD PARTIES
11.1 All film positives/negatives and other reproduction material
used in the manufacture of the Book shall be prepared only
by Licensee, or by a third party under Licensee's control
and who has been approved by Licensor and who has executed
and delivered to Licensor the Supplier's Agreement in the
form attached hereto as Exhibit 1, and the Book shall be
printed only by Licensee or by a printer approved by
Licensor who has executed and delivered to Licensor the said
Supplier's Agreement. Licensor hereby approves the Suppliers
and printers identified on the list attached hereto as
Exhibit 6.
11.2 Licensee shall, upon Licensor's request, deliver to
Licensor, or to publishers designated by Licensor, one or
more duplicate sets of all film positives, film negatives
and other reproduction material used in the manufacture of
the Book, and Licensor or such publishers, as the case may
be, shall reimburse Licensee for the actual cost of
duplicating any such materials delivered as well as for the
actual cost of removing Licensee's trade dress from any such
materials. In no case shall the charge for such material
exceed the lowest price Licensee charges other publishers
for similar material. Without limiting the foregoing,
Licensor shall not authorize any publisher who is licensed
by Licensor to publish in the United States or Canada to
repurpose any covers of the Book or to repurpose substantial
quantities of artwork or text from the Book without
Licensee's prior consent. The foregoing sentence shall apply
only to books published during the Term and in the Territory
which are similar in format, price point, and distribution
channel to the Book.
11.3 Licensee agrees to supply Licensor with the names and
addresses of all of its own manufacturing facilities for the
Book. If Licensee at any time desires to have any
non-printed components of the Book containing Licensed
Property manufactured by a third party, whether the third
party is located within or outside the United States,
Licensee must, as a condition to the continuation of this
Agreement, notify Licensor of the accurate name and complete
address of such Supplier and the Book or components involved
and obtain Licensor's prior written permission to do so. If
Licensor is prepared to grant permission, Licensor will do
so if Licensee and each of Licensee's Suppliers sign a
Consent/Manufacturer's Agreement in a form which Licensor
will furnish to Licensee and Licensor receives all such
agreements properly signed.
11.4 Licensor shall use reasonable efforts not to disclose the
names of Licensee's Suppliers to third parties, including
Affiliates of Licensor, except as may be
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
necessary to enforce Licensor's contract rights or protect
Licensor's trademarks, copyrights, and intellectual property.
11.5 If any such Supplier utilizes the Licensed Property or
trademarks for any unauthorized purpose, Licensee shall
cooperate fully in bringing such utilization to an immediate
halt. If, by reason of Licensee's not having supplied the
above-mentioned agreements to Licensor or not having given
Licensor the name of any Supplier, Licensor makes any
representation or takes any action and is thereby subjected
to any penalty or expense, Licensee will fully compensate
Licensor for any cost or loss Licensor sustains (in addition
to any other legal or equitable remedies available to
Licensor).
12. ADVERTISING
12.1 Licensee may, subject to receiving Licensor's prior written
approval in each case, advertise the Book in newspapers,
periodicals, magazines and other publications and, in
catalogs, on billboards, radio, television or by other
advertising or promotional techniques; provided, however,
that all photography, artwork, text, scripts and storyboards
for all advertising shall be submitted to Licensor for its
prior review and written approval as to the content of such
advertising. Licensor's approval or lack thereof will be
given in a timely fashion. As a condition to the
right of public distribution licensed hereunder, appropriate
and legally sufficient copyright notice in the name of
Disney Enterprises, Inc. (hereinafter referred in this
Agreement as "Disney Enterprises") shall be included in all
advertising for the Book in which any of Disney's characters
or other copyrighted materials appear.
12.2 Following the expiration or termination of this Agreement,
and the Sell-off Period, if any, Licensee will not advertise
or promote the Book in any manner or issue any offering
literature or material with respect thereto.
12.3 Licensee warrants that all advertising and promotions for
the Book shall comply with all applicable Laws and shall not
infringe the rights of any person or entity. Licensor's
approval for the use or manner of use of any proposed
advertising or promotion hereunder shall not constitute an
opinion as to the legal appropriateness or adequacy of such
use or manner of use, and Licensee shall be solely
responsible for any liability or risk of liability arising
out of, or connected with, the use of any such proposed
advertising or promotion.
13. PROMOTION COMMITMENT
Licensee agrees to carry out the Promotion Commitment set forth in
Subparagraph 1.10 above.
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
14. COMMON MARKETING FUND
14.1 Licensee shall pay to Licensor an amount equal to
[Intentionally omitted pursuant to a confidential treatment
request and separately filed with the Commission] (the
"Common Marketing Fund Payment"), which amount Licensee
agrees to pay Licensor concurrently with Royalties due each
Royalty Payment Period as detailed in Paragraph 21 hereof.
Licensee further agrees to pay Licensor the following sums
as a guarantee of such minimum payment (the "CMF Guarantee")
on Licensee's cumulative sales in the following periods and
as non-refundable installments of such guarantee payments
(the "CMF Advances"), due and payable on the dates indicated
below:
[Intentionally omitted pursuant to a confidential treatment
request and separately filed with the Commission].
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
14.2 The Common Marketing Fund Payment as defined hereinabove
shall be placed in a general fund for use in promoting the
Licensed Property, Disney characters, Disney's copyrights,
and trademarks (which may include the Licensed Property) and
licensee activities generally, all as Licensor deems
appropriate in Licensor's sole discretion. Such funds shall
be expended by Licensor and/or Licensor's designees (but not
paid to Licensor's own employees for services they render)
in the amounts and in the manner Licensor deems most
appropriate in order to provide national, territorial,
regional or local advertising, marketing and promotion, and
market research related thereto, of the License Property
licensed hereunder or other Disney properties in the same
property classification. [Intentionally omitted pursuant to a
confidential treatment request and separately filed with the
Commission].
14.3 Licensee agrees to pay in full the CMF Advances on account
of the CMF Guarantee to accrue during the Term only and only
with respect to sales in the Territory. In addition, with
Licensee's statement for each Royalty Payment Period ending
on a date indicated hereinabove with respect to the CMF
Guarantee, Licensee shall pay Licensor the amount, if any,
by which cumulative payment made with respect to sales in
the Territory during any period or periods covered by such
provision fall short of the amount of the CMF Guarantee
specified for that period.
15. OWNERSHIP
15.1 Licensee acknowledges that the copyrights and all other
proprietary rights in and to the Licensed Property are
exclusively owned by and reserved to Disney Enterprises.
Licensee shall neither acquire nor assert any proprietary
right, interest, or title to any character used in the Book,
to the title of the Book, or to any other material prepared
for or contained on or in the Book, or to any copy,
reproduction, translation, or derivative work thereof
(collectively referred to herein as "Disney Property") in
any format or media, now existing or hereafter developed,
through the exercise of any rights granted to Licensee
hereunder. All
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
copyrights and trademarks, service marks, trade dress, and
tradenames pertaining to the Book, as well as all rights of
every kind in and to the Disney Property, shall be Disney
Enterprises' exclusive property, except such trademarks,
tradenames or service marks as do not relate to any Disney
material and do relate to the business name of the Licensee
or the name of any line of books heretofore published by
Licensee. No part of the Book or excerpt therefrom may be
used by or under the authority of Licensee in any way
separate from the Book without Licensor's prior written
consent. Licensor acknowledges Licensee's exclusive
rights in and to Licensee's trademarks, tradenames, service
marks, and trade dress used in connection with Licensee's
own publishing activities, including, without limitation,
Licensee's distinctive differentiated book spine treatment
(collectively, the "Golden Marks). Licensor agrees that it
will not use, or knowingly allow the use by a publishing
licensee (in connection with that licensee's publishing
activities authorized by Licensor), any such Golden Marks or
any marks that are confusingly similar in the reasonable
judgment of Licensee without Licensee's prior written
consent. If Licensee becomes aware of any such unauthorized
use before Licensor does, then Licensee shall promptly
notify Licensor and provide Licensor with an opportunity to
take reasonable corrective action.
15.2 If Licensee creates or acquires material for use in the
Book, whether or not based on or using Disney Enterprises'
characters, and whether or not actually used in the Book or
published, such material shall be deemed a work-for-hire for
Disney Enterprises and all ownership rights (including but
not limited to the copyright therein) shall belong to Disney
Enterprises. Licensee agrees that prior to the creation of
any such material by third parties, Licensee shall cause the
artists and/or writers who create such material, or the
owners of the rights thereto, to execute the work for
hire/copyright assignment agreement in the form attached
hereto as Exhibit 2, agreeing that all such material shall
be considered a work-made-for-hire for Disney Enterprises
and fully releasing or assigning to Disney Enterprises all
rights in such material, including but not limited to all
copyrights, so that all such rights shall inure to Disney
Enterprises and become a part of Disney Enterprises'
copyright and other rights in and to the Book. Licensee
shall provide Licensor with a copy of every work for
hire/copyright assignment agreement, and any other agreement
entered into with respect to the ownership of the Book.
Licensee agrees that it will not give, or agree to give,
credit of any kind to any such artists or writers without
the prior written approval of Licensor.
15.3 Subject to the rights granted hereunder, title (including
copyright and physical ownership) to all material objects
incorporating the Disney Property (including without
limitation, original drawings and illustrations used in the
Book or in promotional or advertising material which portray
the Disney Property as well as all photographs and
reproductions of the originals), whether supplied by
Licensor or prepared by or for Licensee, shall be in Disney
Enterprises, and in no event
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
shall Licensee sell or lease the use of any such material
objects or otherwise part with control thereof. Such material
objects shall be delivered to Licensor in good condition
(subject to normal wear and tear) upon request, at Licensee's
sole expense. If Licensee advises Licensor that any such
material objects requested to be returned are being utilized
by Licensee for the current development of any title to the
Book, then Licensor shall allow Licensee ninety (90) days to
create films or other reproduction material necessary for the
manufacture of the Book, after which the requested materials
must be immediately returned.
15.4 Licensee hereby assigns to Disney Enterprises all right,
title and interest (including but not limited to all
copyright(s) and any extensions and renewals thereof)
throughout the universe in perpetuity which Licensee may
have acquired relating to any and all material prepared or
published hereunder or contemplated hereby, or relating to
the Disney Property or its use of the same hereunder.
Licensee hereby appoints Licensor to act as Licensee's
attorney-in-fact to execute any documents in Licensee's name
and/or on Licensee's behalf necessary to grant or assign
such copyrights or other rights to Disney Enterprises.
16. COPYRIGHT NOTICE
As a condition to the grant of rights hereunder, each copy of the
Book, and any other matter containing Licensed Property, shall bear a
properly located permanently affixed copyright notice comprised of c
in a circle, plus a yeardate of publication, plus "Disney
Enterprises, Inc.", and for those versions of the Book containing
Disney-stylized Winnie The Pooh characters, "Based on the Pooh
stories by X.X. Xxxxx (copyright the Pooh Properties Trust)" or such
other notices as Licensor specifies to Licensee in writing, together
with such other notice of copyright or trademark as may be prescribed
or required by Laws applicable to the Territory in order to
establish, protect, and preserve Disney Enterprises' copyrights and
trademarks. If, through inadvertence or otherwise, a copyright notice
on the Book or other such matter should appear in Licensee's name or
the name of a third party, Licensee hereby agrees to assign to Disney
Enterprises the copyright represented by any such copyright notice in
Licensee's name and, upon request, cause the execution and delivery
to Licensor of whatever documents are necessary to convey to Disney
Enterprises that copyright represented by any such copyright notice.
If, by inadvertence, a proper copyright notice is omitted from the
Book or any other matter containing Licensed Property, Licensee
agrees at Licensee's expense to use all reasonable efforts to correct
the omission on the Book or other matter in the process of
manufacture or in distribution. Licensee agrees to advise Licensor
promptly and in writing of the steps being taken to correct any such
omission and to make the corrections on existing copies of the Book
which can be located. Licensee shall also include such credit lines
in the Book as Licensor may require by written notice to Licensee,
provided that Licensor shall not require such credit lines to
interfere with the Licensee's line look or to be obtrusive.
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
17. REGISTRATIONS
Except with Licensor's written consent, neither Licensee nor any
Affiliate of Licensee will register or attempt to register in any
country copyright in the Book and/or in any part of the Disney
Property, and/or any trademark which is identical with any xxxx used
by Disney or which is so similar thereto as to present, within the
reasonable judgment of Licensor, a likelihood of confusion. In the
event of a breach of the foregoing, Licensee agrees, at Licensee's
expense and at Licensor's request, immediately to terminate the
unauthorized registration activity and promptly to execute and
deliver, or cause to be delivered, to Licensor such assignments and
other documents as Licensor may require to transfer to Disney
Enterprises all rights to the registrations or applications involved.
18. UNLICENSED USE OF LICENSED PROPERTY
18.1 Licensee agrees that Licensee will not use the Licensed
Property, or the trademarks, or any other material the
copyright to which is owned by Disney Enterprises in any way
other than as herein authorized (or as is authorized in any
other written contract in effect between the parties). In
addition to any other remedy Licensor may have, Licensee
agrees that all revenues from any use thereof on products
other than the Book (unless authorized by Licensor in
writing), and all revenues from the use of any other
copyrighted material of Disney Enterprises' without written
authorization, shall be immediately payable to Licensor.
18.2 Licensee agrees to give Licensor prompt written notice of
any unlicensed use by third parties of the Licensed Property
or trademarks of which Licensee becomes aware, and that
Licensee will not, without Licensor's written consent, bring
or cause to be brought any criminal prosecution, lawsuit or
administrative action for infringement, interference with or
violation of any rights to the Book, its contents and/or the
characters. Because of the need for and the high costs of an
effective anti-piracy enforcement program, Licensee agrees
to cooperate with Licensor and, if necessary, to be named by
Licensor as a sole complainant or co-complainant in any
action against an infringer of the Licensed Property and,
notwithstanding any right of Licensee to recover same, legal
or otherwise, Licensee agrees to pay to Licensor, and hereby
waives all claims to, all damages or other monetary relief
recovered in such action by reason of a judgment or
settlement whether or not such damages or other monetary
relief, or any part thereof, represent or are intended to
represent injury sustained by Licensee as a licensee
hereunder; in any such action against an infringer, Licensor
agrees to reimburse Licensee for reasonable expenses
incurred at Licensor's request, including reasonable
attorney's fees and disbursements if Licensor has requested
Licensee to retain separate counsel.
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
19. WARRANTIES AND INDEMNITIES
19.1 Licensee hereby represents and warrants that any material
used in the Book, other than material supplied by Licensor,
shall not infringe upon or interfere with any common law
right, or any other right, of any person or entity, and that
the creation, manufacture, publishing, marketing,
pre-pricing, pricing, sale and distribution of the Book
shall be in compliance with all applicable Laws and shall
not infringe the rights of any person or entity. Without
limiting the foregoing, Licensee represents and warrants
that no such material shall infringe any copyright or defame
or invade the rights of privacy or publicity of any person
or entity. Licensee further represents and warrants that it
will not use or allow the use of the name "Xxxx Disney" or
the name "Disney", or the name or likeness of the fanciful
characters of Disney or any name, xxxx, emblem, logo or
designation that suggests or implies an association with
Disney, for any purpose other than as specified in this
Agreement, unless explicitly authorized by Licensor in
writing to do so.
19.2 Licensee hereby indemnifies and holds Disney harmless,
during and after the Term hereof, against all claims,
demands, suits, judgments, losses, liabilities (including
settlements entered into in good faith with Licensee's
consent, not to be unreasonably withheld) and expenses of
any nature (including reasonable attorneys' fees and
disbursements) arising out of Licensee's activities under
this Agreement, including but not limited to, any actual or
alleged: (1) negligent acts or omissions on Licensee's part,
(2) defect (whether obvious or hidden and whether or not
present in any sample approved by Licensor) in the Book, (3)
personal injury, (4) infringement of any rights of any other
person by the manufacture, sale, possession or use of the
Book, (5) breach on Licensee's part of any covenant,
representation or warranty contained in this Agreement or
(6) failure of the Book, or by Licensee, to comply with
applicable Laws. The parties indemnified hereunder shall
include Licensor, and its parent, successors and
subsidiaries, and their officers, directors, employees and
agents. The indemnity shall not apply to any claim or
liability relating to any infringement of the copyright of a
third party caused by Licensee's utilization of the Licensed
Property in accordance with the provisions hereof, unless
such claim or liability arises out of Licensee's failure to
obtain the full assignment of rights referenced in Paragraph
15 above.
19.3 Licensor hereby represents and warrants that the Disney
Property supplied by Licensor hereunder shall not infringe
the copyright of any third party or any right granted by
Licensor to such third party. Licensor hereby indemnifies
and holds Licensee harmless during and after the Term hereof
against all claims, demands, suits, judgments, losses,
liabilities, (including settlements entered into in good
faith with Licensor's consent, not to be unreasonably
withheld), and expenses of
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
any nature (including reasonable attorney's fees and
disbursements) arising out of any claim that Licensee's
use of any representation of the Licensed Property approved
in accordance with the provisions of this Agreement infringes
the copyright of any third party or infringes any right
granted by Licensor to such third party, except for claims
arising out of Licensee's failure to obtain the full
assignment of rights referenced in Paragraph 15 above. In no
event shall Licensor be liable for lost profits. Without
limiting the generality of this Subparagraph 19.3, if during
the term of this Agreement Licensor enters into another
licensed publishing agreement for the Territory in which
Licensor agrees to provide representations and warranties
which exceed the scope of this Subparagraph 19.3, then such
additional representations and warranties shall be included
in the representations and warranties provided by Licensor
herein.
19.4 If by reason of any claims referred to in Subparagraph 19.3
above, Licensee is precluded from selling any stock of the
Book or utilizing any materials in Licensee's possession or
which come into Licensee's possession by reason of any
required recall, Licensor shall be obligated to purchase
such Books and materials from Licensee at the out-of-pocket
cost to Licensee, excluding overhead, but Licensor shall
have no other responsibility or liability with respect to
such Books or materials, except that the Advance and
Guarantee shall be adjusted to correspond to the time
remaining in the Term at the date of the purchase by
Licensor.
19.5 Licensor gives no warranty or indemnity with respect to any
liability or expense arising from any claim that use of the
Licensed Property or the trademarks on or in connection with
the Book hereunder or any packaging, advertising or
promotional material infringes on any trademark right of any
third party or otherwise constitutes unfair competition by
reason of any prior rights acquired by such third party,
other than rights acquired from Disney Enterprises. It is
expressly agreed that it is Licensee's responsibility to
carry out such investigations as Licensee may deem
appropriate to establish that the Book, packaging, and
promotional and advertising material which are manufactured
or created hereunder, including any use made of the Licensed
Property and the trademarks therewith, do not infringe such
right of any third party, and Licensor shall not be liable
to Licensee if such infringement occurs.
19.6 Licensee and Licensor agree to give each other prompt
written notice of any claim or suit which may arise under
the indemnity provisions set forth above. Without limiting
the foregoing, Licensee agrees to give Licensor written
notice of any product liability claim made or suit filed
with respect to the Book, any investigations or directives
regarding the Book issued by the Consumer Product Safety
Commission ("CPSC") or other federal, state or local
consumer safety agency, and any notices sent by Licensee to,
or received by Licensee from,
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
the CPSC or other consumer safety agency regarding the Book
within seven (7) days of Licensee's receipt or promulgation
of the claim, suit, investigation, directive, or notice.
20. INSURANCE
Licensee shall maintain in full force and effect at all times while
this Agreement is in effect, and for three (3) years thereafter,
commercial general liability insurance on a per occurrence form,
including broad form coverage for contractual liability, property
damage, products liability and personal injury liability (including
bodily injury and death), waiving subrogation, with minimum limits of
no less than two million United States Dollars (U.S. $2,000,000.00)
per occurrence, and naming as additional insureds those indemnified
in Subparagraph 19 hereof. Licensee also agrees to maintain in full
force and effect at all times while this Agreement is in effect such
Worker's Compensation Insurance as is required by applicable law and
Employer's Liability Insurance with minimum limits of one million
United States Dollars (U.S. $1,000,000.00) per occurrence. All
insurance shall be primary and not contributory. Licensee shall
deliver to Licensor a certificate(s) of insurance evidencing
satisfactory coverage and indicating that Licensor shall receive
thirty (30) days unrestricted prior written notice of cancellation,
non-renewal, or material change in coverage. Licensee's insurance
shall be carried by an insurer with a Best Guide rating of B + VII or
better. Compliance herewith in no way limits Licensee's indemnity
obligations, except to the extent that Licensee's insurance company
actually pays Licensor amounts which Licensee would otherwise pay
Licensor.
21. STATEMENTS AND PAYMENT OF ROYALTIES
21.1 Licensee agrees to pay and shall pay to Licensor all
Royalties required under this Agreement. Licensee shall
submit to Licensor statements of account so as to be
received by Licensor no later than twenty-five (25) days
after the end of each Royalty Payment Period during the
Term. Licensee shall submit such statements of account
regardless of whether any sales have taken place and/or any
Royalties are payable to Licensor. Licensee's statements
shall be on forms substantially similar to those designated
by Licensor for Licensee's use (a sample copy of the current
form is attached hereto as Exhibit 7), showing all
information requested by such forms (subject to Subparagraph
21.8 below), including but not limited to the following:
If Licensee's Royalty calculation is based on a percentage
of the suggested retail price ("SRP") of the Book:
(i) Licensee's product number, ISBN, and title;
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
(ii) the Royalty rate code as provided by Licensor;
(iii) the applicable SRP Royalty rate;
(iv) the applicable Net Invoiced Xxxxxxxx ("NIB")
Royalty rate;
(v) the gross quantities by title of the Book sold (a
sale of the Book shall be deemed to have occurred
on the date the Book is shipped to the customer);
(vi) the SRP(s) on which the Royalty is calculated;
(vii) the sum of the units sold multiplied by the
applicable SRP ("Gross SRP Dollars)
(viii) Net Invoiced Xxxxxxxx ("NIB Dollars");
(ix) the applicable SRP Royalty rate multiplied by Gross
SRP Dollars;
(x) the applicable NIB Royalty rate multiplied by NIB
Dollars;
(xi) the Royalty payment due; and
(xii) a separate report for each item number (i) through
(xi) above as they apply to returns.
If Licensee's Royalty calculation is based on Net Invoiced
Xxxxxxxx:
(i) Licensee's product number, ISBN, and title;
(ii) the Royalty rate code as provided by Licensor;
(iii) the applicable NIB Royalty rate;
(iv) the gross quantities by title of the Book sold (a
sale of the Book shall be deemed to have occurred
on the date the Book is shipped to the customer);
(v) NIB Dollars;
(vi) the Royalty payment due; and
(vii) a separate report for each item number (i) through
(vi) above as they apply to returns.
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
Sales to countries other than the United States, if any such
are permitted, shall be reported separately by country.
Royalty payments shown as due shall be delivered to Licensor
with such statements; provided, however, that Licensee shall
deliver directly to Licensor's Canadian office, at the
address listed below in Subparagraph 21.4, Royalties payable
on sales of the Book in Canada and a separate statement of
account for such sales. GST applicable to Royalties or to
any other payments due to Licensor shall be indicated on
Licensee's statements of account for Canada and paid to
Licensor along with the Royalty or other payment. Royalties
are also payable, and due with such statements, on inventory
shrinkage that exceeds [Intentionally omitted pursuant to a
confidential treatment request and separately filed with the
Commission] (excluding free copies authorized pursuant to
Subparagraph 1.6(viii) above). Inventory shrinkage means the
reduction in Licensee's inventory of the Book not caused by
sales or damaged copies. To the extent that Royalties are
not paid, Licensor may offset Royalties due hereunder
against any sums which Licensor or any of its Affiliates may
owe to Licensee or any of its Affiliates. No deduction or
withholding from Royalties payable to Licensor shall be made
by reason of any tax. Any applicable tax on the manufacture,
distribution and sale of the Book shall be borne by
Licensee.
21.2 The statement forms Licensor designates for Licensee's use
may be changed from time to time, and Licensee agrees to use
the most current form Licensor provides to Licensee.
Licensee shall fully comply with all of Licensor's
instructions for completing such forms. Licensee shall
submit, concurrently with Licensee's written statement of
account for each Royalty Payment Period, an electronic
version (e.g., computer diskette or electronic transmission)
of such statement of account. Licensee shall continue to
submit, in electronic or written form, the "Supplemental
Schedule" which Licensee has heretofore been submitting to
Licensor in conjunction with Licensee's statements of
account, identifying the new titles being sold for each
Royalty Payment Period.
21.3 Sales of books licensed under contracts with Licensor other
than this Agreement shall not be reported on the same
statement as sales of the Book under this Agreement.
21.4 Licensee's payments, including all Royalties (excluding
Royalties payable to Canada), shall be delivered to the
attention of the Disney Publishing Group, X.X. Xxx 000000,
Xxxxxxx, Xxxxxxx 00000. A copy of each statement and payment
must be sent to The Disney Publishing Group, 000 Xxxxx Xxxxx
Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxx 00000-0000, to the
attention of Disney Licensed Publishing. If Licensee wishes
to send statements and payments by overnight courier, please
use the following address: The Disney Publishing Group, 0000
Xxxx Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxxxxxxx
00000-0000, Attention Disney Licensed Publishing. Any
Advances should be mailed directly to The Disney Publishing
Group, 0000 Xxxx Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxx,
Xxxxxxxxxx 00000-0000,
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
to the attention of the Contract Administrator. Statements
and Royalties payable to Canada shall be delivered to Disney
Worldwide Services, Inc. - T6071, P.O. Box 6100, Postal
Station "F", Toronto, Ontario X0X 0X0.
21.5 Licensee shall indicate on Licensee's statement of account
the amount of any reserve for returns maintained. Licensee
shall not maintain an unreasonable reserve for returns. In
no event shall Licensee's reserve for returns exceed
[Intentionally omitted pursuant to a confidential treatment
request and separately filed with the Commission] of the
Royalties due in the Royalty Payment Period being reported,
unless Licensee has obtained the prior written consent of
Licensor. In the event that actual returns exceed the
reserve for returns and cannot be recouped out of Royalties
otherwise due in the relevant Royalty Payment Period, or any
subsequent Royalty Payment Period, Licensor shall refund at
the end of the Term unearned Royalties previously paid in
excess of any Advances, and subject to payment by Licensee
when due of any guarantee obligation. Such refund may be
applied by Licensor against any late charges that may be due
by Licensee hereunder. In the event that reserves exceed
actual returns, Licensee shall pay Royalties on the
difference with Licensee's final statement of account for
the Term. Licensee may report returns during the Term of the
Agreement only. In no event may Licensee report returns
which occur during the Sell-off Period, if granted. For
purposes of clarity, in no event shall Licensee be entitled
to offset any returns against Licensee's Guarantee
obligations. Without limiting the generality of the
foregoing, once Licensee has attained the capability to
report actual returns on a consistent basis and can
demonstrate to Licensor the need to increase the allowable
reserve for returns percentage, Licensor shall in good faith
consider permitting a reasonable increase.
21.6 Within thirty (30) days prior to the beginning of each
Royalty Payment Period and within ninety (90) days prior to
the beginning of each Guarantee period, Licensee shall
submit to Licensor a forecast of the expected Net Invoiced
Xxxxxxxx, projected unit volumes to be sold, unit volumes to
be returned, reserve percentages, suggested retail prices,
and Royalties for each title of the Book for each respective
time period.
21.7 Licensee shall take all necessary steps to ensure that its
information systems, including without limitation, all its
proprietary and all third party hardware and software,
process dates correctly prior to, during and after the
calendar year 2000 ("Year 2000 Compliance"). Year 2000
Compliance shall include, without limitation, correct
century recognition, calculations that properly accommodate
same century and multi-century formulas and date values, and
interface values that reflect the appropriate century.
Necessary steps to ensure Year 2000 Compliance shall
include, without limitation, analysis of all components of
Licensee's information systems and, as necessary,
development, installation and testing of software fixes,
patches and/or updates. In a timely manner, but no later
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
than December 31, 1998, Licensee shall advise Licensor in
writing whether or not its information systems are Year 2000
Compliant. If Licensee advises Licensor that Licensee's
information systems are not Year 2000 Compliant, Licensee
shall endeavor to ensure that its information systems are
substantially Year 2000 Compliant on or before June 30,
1999.
21.8 Without limiting the generality of this Paragraph 21,
Licensor recognizes and acknowledges that Licensee's current
automated accounting system may not have the capability to
report all of the information required by Licensor,
including the information required under Subparagraphs 21.1
and 21.6 above. Licensee represents that it is currently
working to improve its automated accounting system so as to
be in a position to provide Licensor with all of the
information requested by Licensor for reporting purposes
under those Subparagraphs by January 1, 2000. Until such
time, Licensee shall not be deemed to be in breach of
Subparagraphs 21.1 or 21.6 if Licensee (a) uses its best
efforts to report to Licensor the maximum amount of
information required under Subparagraphs 21.1 and 21.6 which
Licensee is reasonably capable of reporting and (b) Licensee
provides Licensor any such additional information required,
if reasonably available and whether or not contained in
Licensee's automated accounting system, on an as-needed
basis when requested by Licensor, including, but not limited
to, in connection with Licensor's audit rights under
Paragraph 23 below.
22. INTEREST
Royalties, audit findings or any other payments due to Licensor
hereunder which are received after the due date shall bear interest
at the rate of [Intentionally omitted pursuant to a confidential
treatment request and separately filed with the Commission] per annum
from the due date, or at the maximum rate permissible by law if less
than [Intentionally omitted pursuant to a confidential treatment
request and separately filed with the Commission].
23. AUDITS AND MAINTAINING RECORDS
23.1 Licensee agrees to keep and preserve accurate records,
during the Term hereof and for two (2) years after the
expiration or termination of this Agreement, of all
transactions relating to this Agreement and any prior
agreement with Licensor regarding the Licensed Property,
including, without limitation, print runs, shipments to
Licensee of the Book and any components thereof, inventory
records, records of sales and shipments by Licensee, and
records of returns. Licensor, and/or a representative of
Licensor, shall have the right at any time, during the Term
hereof and for two (2) years after the expiration or
termination of this Agreement, during reasonable business
hours upon a prior request made by Licensor, to examine and
make extracts from all such records, including the general
ledger, invoices, and any other records which Licensor
reasonably deems appropriate to verify the accuracy of
Licensee's statements of account or
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
Licensee's performance under this Agreement. Licensee
acknowledges that Licensor may furnish Licensee with an
audit questionnaire, and Licensee agrees to fully and
accurately complete such questionnaire, and return it to
Licensor within the designated time. Licensor's use of an
audit questionnaire shall not limit Licensor's ability to
conduct any on-site audit(s) as provided above. Licensee
acknowledges that an audit conducted by Licensor or its
representatives, may involve one or more license agreements
at a time.
23.2 If in any audit of Licensee's records it is determined that
there is a shortfall of five percent (5%) or more in
Royalties reported for any Royalty Payment Period, Licensee
shall, upon request from Licensor, reimburse Licensor for
the full out-of-pocket costs of the audit, including the
costs of employee auditors calculated at their then current
hourly rate per person for travel time during normal working
hours and actual working time.
23.3 If Licensee has failed to keep accurate records for one or
more Royalty Payment Periods, Licensor will assume that the
Royalties owed to Licensor for such Royalty Payment
Period(s) are equal to a reasonable amount, determined in
Licensor's absolute discretion, which may be up to, but will
not exceed, the highest Royalties owed to Licensor in a
Royalty Payment Period for which Licensee has kept accurate
records. If Licensee has failed to keep adequate records for
any Royalty Payment Period, Licensor will assume a
reasonable amount of Royalties which Licensee will owe to
Licensor, based on the records Licensee has kept and other
reasonable assumptions Licensor deems appropriate.
24. WITHDRAWAL OF LICENSED MATERIAL
Licensor may require Licensee to withhold and/or withdraw the
Licensed Property, or any part thereof, the use or sale of which
under this Agreement would infringe or reasonably be claimed to
infringe the rights of a third party, other than rights granted by
Disney Enterprises, in which case Licensor's obligations to Licensee
shall be limited to the purchase at cost of the Books and other
materials utilizing such withdrawn Licensed Property which cannot be
used or sold. In the case of any withdrawal under the preceding
sentence, the Advance and Guarantee shall be adjusted to correspond
to the time remaining in the Term at the date of withdrawal.
25. TERMINATION
Without prejudice to any other right or remedy available to it,
Licensor shall have the right at any time to terminate this
Agreement, by giving written notice thereof, in the event of the
occurrence of one (1) or more of the following:
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
25.1 If Licensee delivers to any customer without Licensor's
written authorization anything containing representations of
the Licensed Property or other material the copyright or
other proprietary rights to which are owned by Disney
Enterprises, other than the Book described herein and
approved in accordance with the provisions hereof and such
breach is not cured within thirty (30) days after
notification by Licensor of the breach (or, in the event of
a breach which cannot be corrected within thirty (30) days,
if Licensee fails to commence such correction within such
thirty (30) day period and thereafter diligently prosecute
it to completion); or
25.2 If Licensee delivers the Book outside the Territory (unless
the Book is destined for ultimate delivery in the Territory)
or sells the Book to a third party if Licensee knows, or in
the exercise of prudent business judgment should know, that
such sale will result in delivery of the Book outside the
Territory and such breach is not cured within thirty (30)
days after notification by Licensor of the breach (or, in
the event of a breach which cannot be corrected within
thirty (30) days, if Licensee fails to commence such
correction within such thirty (30) day period and thereafter
diligently prosecute it to completion); or
25.3 If Licensee fails to make any payment and/or furnish any
statement as herein provided, and if such failure is not
corrected within thirty (30) days following the date said
statement or payment was due; or
25.4 If Licensee shall breach any other terms of this Agreement
and if any such breach is not corrected within thirty (30)
days after notification by Licensor of the breach (or, in
the event of a breach which cannot be corrected within
thirty (30) days, if Licensee fails to commence such
correction within such 30 day period and thereafter
diligently prosecute it to completion); or
25.5 If Licensee breaches any material term of any other
agreement between the parties to this Agreement, and
Licensor terminates such other agreement for cause; or
25.6 If Licensee shall make any assignment for the benefit of
creditors, or file a petition in bankruptcy, or be adjudged
bankrupt, or become insolvent, or be placed in the hands of
a receiver. The equivalent of any of the proceedings or acts
referred to in this Subparagraph, though known and/or
designated by some other name or term in any part of the
Territory shall likewise constitute a ground for termination
of this Agreement by Licensor; or
25.7 If Licensee is not permitted or is unable to operate its
business in the usual manner, or is not permitted or is
unable to provide Licensor with assurances satisfactory to
Licensor that Licensee will so operate Licensee's business,
as debtor in possession or its equivalent, or is not
permitted, unable to otherwise
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
meet Licensee's obligations under this Agreement or to
provide Licensor with assurance satisfactory to Licensor
that Licensee will meet such obligations; or
25.8 If [Intentionally omitted pursuant to a confidential
treatment request and separately filed with the Commission]
during the Term of this Agreement (and any extension
thereof) Licensee breaches any material provision of this
Agreement which is of the same nature, and which violates
the same provision of this Agreement, as a breach of which
Licensor has previously given Licensee written notice; or
25.9 If Licensee transfers or attempts to transfer this Agreement
in contravention of Paragraph 27 below; or
25.10 If [Intentionally omitted pursuant to a confidential
treatment request and separately filed with the Commission]
during the Term of this Agreement (and any extension
thereof) Licensee breaches any covenant set forth in
Paragraph 10 of this Agreement after Licensor has previously
given Licensee written notice of a breach of any covenant
set forth in such Paragraph 10; or
25.11 If [Intentionally omitted pursuant to a confidential
treatment request and separately filed with the Commission]
Consent/Manufacturer's Agreements or Supplier's Agreements,
either combined or separately, are terminated in any
twelve-month period by Licensor for the Suppliers' failure
to pass compliance inspections as referenced in Paragraphs
10 and 11 above; and/or
25.12 If Licensee materially breaches any provision of the
Warrant, and such breach is not cured within thirty (30)
days after notification by Licensor of the breach (or, in
the event of a breach which cannot be corrected within
thirty (30) days, if Licensee fails to commence such
correction within such thirty (30) day period and thereafter
diligently prosecute it to completion).
26. RIGHTS AND OBLIGATIONS UPON EXPIRATION OR TERMINATION
26.1 Upon the expiration or termination of this Agreement, all
rights granted herein to Licensee shall revert to Licensor,
any unpaid portion of the Guarantee shall be due and payable
in accordance with the provisions set forth in Subparagraph
4.1 below, and Licensor shall be entitled to retain any and
all consideration paid to Licensor and other things of value
paid or delivered to Licensor.
26.2 Licensee agrees that the Book shall be manufactured during
the Term in quantities consistent with anticipated demand
therefor so as not to result in an excessive inventory
build-up immediately prior to the end of the Term.
Licensee agrees that from the expiration or termination of
this Agreement, Licensee shall neither manufacture nor have
manufactured for Licensee the Book, and that except as
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
hereinafter may be provided, Licensee will cease selling the
Book. Any unauthorized distribution of the Book after the
expiration or termination of this Agreement shall constitute
copyright infringement.
26.3 If Licensee has any unsold copies of the Book in inventory
on the expiration or termination date, Licensee shall
provide Licensor with a full itemized statement, certified
by an authorized accredited officer of Licensee, of all
unsold copies of the Book remaining in stock. If such
statement has been provided to Licensor and if Licensee has
complied with the material terms of this Agreement,
including the payment of all Royalties due and the
Guarantee, upon notice from Licensor, Licensee shall have
the right to fill orders, as authorized under Paragraph 2
above, from its then remaining stocks of the Book for a
limited period of twelve (12) calendar months following the
expiration of the Term by the passage of time (the "Sell-off
Period"). Licensee shall consult with Licensor regarding its
sell-off plan and sell off remaining stocks of the Book only
pursuant to such plan and in such distribution channels as
are mutually acceptable to the parties. Licensee shall
furnish Licensor with statements of account covering such
sales and pay Licensor Royalties upon such sales. Such
Royalties shall not be applied against the Advance or
towards meeting the Guarantee. All rights and remedies
available to Licensor during the Term shall be equally
available to Licensor during the Sell-off Period.
26.4 Following the expiration of the Sell-off Period, Licensee
shall provide Licensor with an itemized statement of all
unsold copies of the Book remaining in stock. All unsold
copies of the Book shall, at the end of the Sell-off Period
(or, if there is no Sell-off Period, upon the expiration or
earlier termination of the Term), at Licensor's option, be
sold to Licensor at Licensee's actual cost of manufacture,
excluding overhead, or shall be destroyed, and Licensee
shall furnish Licensor with an affidavit of such destruction
signed by a principal officer of Licensee.
26.5 Licensee agrees that all pre-pricing and pricing of the Book
shall be in compliance with any and all Laws applicable
thereto. In recognition of Licensor's interest in
maintaining a stable and viable market for the Book during
and after the Term and any Sell-off Period, Licensee agrees
to refrain from "dumping" the Book in the market during the
Term and any Sell-off Period granted to Licensee.
[Intentionally omitted pursuant to a confidential treatment
request and separately filed with the Commission].
-38-
Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
26.6 Except as otherwise agreed by Licensor in writing, any
inventory of the Book in Licensee's possession or control
after the expiration or termination of this Agreement, and
any Sell-off Period granted hereunder, shall be destroyed,
or all Licensed Property removed or obliterated therefrom.
26.7 At the expiration or earlier termination of this Agreement,
Licensee agrees to deliver to Licensor, without charge to
Licensor, any and all artwork, including without limitation,
reference materials, mechanicals, digital files, original
manuscripts and paintings, film and film
positives/negatives, four-color separations, photographs,
transparencies, film proofs, and any other reproduction
material used in the creation, development, and manufacture
of the Book, whether furnished by Licensor, created by
Licensee or otherwise acquired by Licensee (the property
rights in all of which such materials shall remain vested in
Disney Enterprises at all times). If Licensee should for any
reason fail to deliver such materials, or any part thereof,
and Licensor thereafter must recreate such material,
Licensee agrees to reimburse Licensor for the reasonable
costs incurred by Licensor in so doing.
26.8 Notwithstanding any provision to the contrary, in the case
of termination under Subparagraphs 25.6 or 25.7 above, in
order to protect the value of the Book and to avoid any
disparagement of the Book which would occur as a result of
the circumstances of termination, Licensor shall have the
option, in Licensor's absolute discretion, to purchase any
or all unsold copies of the Book in Licensee's inventory on
the termination date at [Intentionally omitted pursuant to a
confidential treatment request and separately filed with the
Commission].
27. NON-ASSIGNABILITY
27.1 This license and the rights granted and obligations
undertaken hereunder are personal to Licensee. Licensee
shall not voluntarily or by operation of law assign,
sub-license, transfer, encumber or otherwise dispose of all
or any part of Licensee's interest in this Agreement
(including, but not limited to, any encumbrance of the Book)
without Licensor's prior written consent, to be granted or
withheld in Licensor's absolute discretion. Any attempted
assignment, sub-license, transfer, encumbrance or other
disposal without such consent shall be void and shall
constitute a material default and breach of this Agreement.
"Transfer" within the meaning of this Paragraph 27 shall
include (1) any merger or consolidation involving Licensee
or Golden Books Family Entertainment, Inc. ("GBFE"); (2) any
sale or transfer of all or substantially all of Licensee's
or GBFE's assets; (3) any transfer of Licensee's rights or
duties hereunder to a division, business segment or other
entity different from the one specifically referenced on
page 1 hereof (or any sale or attempted sale of the Book
under a trademark or trade name of such division, business
segment or other entity);
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
(4) any public offering, or series of public offerings,
whereby a cumulative total of thirty-three and one-third
percent (33 1/3%) or more of the voting stock (or any other
capital stock cumulatively convertible into the right to vote
such percentage) of Licensee or GBFE is offered for purchase;
and (5) any acquisition, or series of acquisitions, by any
person or entity, or group of related persons or entities,
of a cumulative total of thirty-three and one-third percent
(33-1/3%) or more of the voting stock (or any other capital
stock cumulatively convertible into the right to vote such
percentage) or the Beneficial Ownership (as defined in
Rule 13d-3 of the Securities Exchange Act of 1934, as amended)
of Licensee or GBFE.
27.2 Licensee hereby represents that, as of the date of this
Agreement, Golden Press Holdings, L.L.C. ("GPH") holds all
Series "B" Preferred Shares in GBFE (the "Series B
Shareholder"). For purposes of clarification, "transfer"
within the meaning of this Paragraph 27 shall not include
(i) any conversion of Series "B" Preferred Shares into
Common Shares by the Series B Shareholder or (ii) any
actions described in the definition of "transfer" in
Subparagraph 27.1 if such actions occur between or among
X.X. Xxxxxxx Xxxxxx & Company and its Affiliates. Licensee
further represents that, as of the date of this Agreement,
X.X. Xxxxxxx Xxxxxx & Company, Warburg, Xxxxxx & Co.,
Warburg Pincus Ventures, L.P., and their respective
Affiliates are the Beneficial Owners (as defined above) of
thirty-three and one-third percent (33-1/3%) or more of the
voting stock (or other capital stock cumulatively
convertible into the right to vote such percentage) of GBFE
(the "Warburg Pincus Shares"). The following shall apply
with respect to any transfer of the Warburg Pincus Shares
which requires the consent of Licensor pursuant to
Subparagraph 27.1 above:
(1) Licensor hereby consents to the transfer by a
widely-distributed public offering of the Warburg Pincus
Shares to individual investors [Intentionally omitted
pursuant to a confidential treatment request and separately
filed with the Commission].
(2) [Intentionally omitted pursuant to a confidential
treatment request and separately filed with the Commission].
-40-
Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
(3) [Intentionally omitted pursuant to a confidential
treatment request and separately filed with the Commission].
27.3 Licensee agrees to provide Licensor with at least thirty
(30) days prior written notice of any desired assignment of
this Agreement or other transfer as defined in this
Paragraph 27. At the time Licensee gives such notice,
Licensee shall provide Licensor with the information and
documentation necessary to evaluate the contemplated
transaction. Except as otherwise provided in Subparagraph
27.2 above, Licensor's consent (if given) to any assignment
of this Agreement or other transfer as defined in this
Paragraph 27 shall be subject to such terms and conditions
as Licensor deems appropriate, including but not limited to,
payment of a transfer fee. The amount of the transfer fee
shall be determined by Licensor based upon the circumstances
of the particular assignment or transfer, taking into
account such factors as the estimated value of the license
being assigned or otherwise transferred; the risk of
business interruption or loss of quality, production or
control Licensor may suffer as a result of the assignment or
other transfer; the identity, reputation, creditworthiness,
financial condition and business capabilities of the proposed
assignee or other entity involved in the transfer; and
Licensor's internal costs related to the assignment or other
transfer; provided, however, in no event shall the transfer
fee be less than [Intentionally omitted pursuant to a
confidential treatment request and separately filed with
the Commission] for any license between Licensor and Licensee
involved in an assignment or other transfer. The foregoing
transfer fee shall not apply if this Agreement is assigned
to one or more of Licensee's Affiliates as part of a corporate
reorganization exclusively among some or all of the entities
existing in Licensee's corporate structure when this
Agreement is signed; provided, however, that Licensee must
give Licensor written notice of such assignment and a
description of the reorganization. The provisions of this
Subparagraph 27 shall supersede any conflicting provisions
on this subject in any publishing license agreements
previously entered into between Licensee and Licensor for
this Territory.
27.4 Notwithstanding Subparagraphs 27.1 and 27.3 above, Licensee
may, upon Licensor's prior written consent sublicense
Licensee's rights and/or obligations hereunder to any of
Licensee's Affiliates, provided that each such Affiliate
agrees to be bound by all of the terms and conditions of
this Agreement, and provided that each such Affiliate agrees
to guarantee Licensee's full performance of this Agreement
(including, but not limited to, Paragraph 19) and to
indemnify Licensor for any failure of such performance, and
further provided that Licensee
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
and each such Affiliate agree to provide Licensor with
satisfactory documentation of such agreement(s), guarantee(s),
and indemnification upon Licensor's request therefor. Licensee
hereby irrevocably and unconditionally guarantees that any
and all Affiliates sublicensed hereunder will observe and
perform all of Licensee's obligations under this Agreement,
including, but not limited to, the provisions governing
approvals, and compliance with approved samples, applicable
Laws, and all other provisions hereof, and that such
companies will otherwise adhere strictly to all of the terms
hereof and act in accordance with Licensee's obligations
hereunder. Any involvement of an Affiliate in the activities
which are the subject of this Agreement shall be deemed
carried on pursuant to such a sublicense and thus covered by
such guarantee; however, unless Licensee has obtained
Licensor's consent to sublicense an Affiliate in each
instance, such Affiliate shall be deemed to be included in
the term "Licensee" for all purposes under this Agreement,
and Licensor may treat such unapproved involvement of the
Affiliate as a breach of the Agreement. In the event of any
sublicense to an Affiliate hereunder, the reference in
Subparagraph 27.1 to Licensee shall include such Affiliate
sublicensee.
27.5 Licensor's rights and obligations hereunder may be assigned,
delegated or otherwise transferred by Licensor.
28. NOTICES
All notices which either party is required or may desire to serve
upon the other party hereunder shall be in writing and addressed to
the party to be served at the address set forth below, or to such
other address as either party may hereafter designate:
To Licensor: Disney Licensed Publishing
000 X. Xxxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attention: Vice-President
With a copy to: The Xxxx Disney Company
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx
Vice President - Eastern Regional Counsel
To Licensee: Golden Books Publishing Company, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxxxx
-42-
Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
With a copy to: Golden Books Publishing Company, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxx, Esq.
Any notice, served by either party, may be served personally or by
depositing the same addressed as herein provided (unless and until
otherwise notified), postage prepaid, in the official mail of the
country in which deposited, or by documented overnight delivery
service. Such notice shall be deemed to have been served upon
personal delivery or upon the date of mailing. However, Licensor
shall be deemed to have been served with a notice of a request for
approval of materials under this Agreement only upon Licensor's
actual receipt of the request and of any required accompanying
materials.
29. MUSIC
Music is not licensed hereunder. Any charges, fees or royalties
payable for music rights or any other rights not covered by this
Agreement shall be additional to the Royalties and covered by
separate agreement.
30. GOODWILL
Licensee hereby acknowledges that the rights and powers retained by
Licensor hereunder are necessary to protect Disney Enterprises'
copyrights and property rights, and, specifically, to conserve the
goodwill and good name of Licensor's products and Licensor's
Affiliates, the Disney Property and the name "Disney", and
therefore Licensee agrees that Licensee will not allow the same to
become involved in matters which will, or could, detract from or
impugn the public acceptance and popularity thereof, or impair their
legal status.
31. RELATIONSHIP
This Agreement does not provide for a joint venture, partnership,
franchise, agency or employment relationship between the parties, or
any other relationship than that of licensor and licensee.
32. CONSTRUCTION
The language of all parts of this Agreement shall in all cases be
construed as a whole, according to its fair meaning and not strictly
for or against any of the parties. Headings of paragraphs herein are
for convenience of reference only and are without substantive
significance.
-43-
Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
33. MODIFICATIONS OR EXTENSIONS OF THIS AGREEMENT
Except as otherwise provided herein, this Agreement can only be
extended or modified by a writing signed by both parties executed
after the effective date hereof; provided, however, that certain
modifications shall be effective if signed by the party to be charged
and communicated to the other party.
34. RESERVATION OF RIGHTS
All rights not specifically granted and licensed to Licensee
hereunder are reserved to Licensor.
35. WAIVERS
A waiver by either party at any time of a breach of any provision of
this Agreement shall not apply to any breach of any other provision
of this Agreement, or imply that a breach of the same provision at
any other time has been or will be waived, or that this Agreement has
been in any way amended, nor shall any failure by either party to
object to conduct of the other be deemed to waive such party's right
to claim that a repetition of such conduct is a breach hereof.
36. SEVERABILITY
In the event any provision contained herein is held to be unlawful or
unenforceable, such provision shall be severable from the remaining
provisions of this Agreement, which shall remain in full force and
effect.
37. CHOICE OF LAW AND FORUM
This Agreement shall be deemed to be entered into in California and
shall be governed and interpreted according to the laws of the State
of California applicable to contracts made and to be fully performed
in California. Any legal actions pertaining to this Agreement shall
be commenced within the State of California and within either Los
Angeles or Orange Counties, and Licensee hereby consents to the
jurisdiction of the courts located in Los Angeles or Orange Counties.
38. EQUITABLE RELIEF
Licensee acknowledges that Licensor will have no adequate remedy at
law if Licensee continues to manufacture, sell, advertise, promote or
distribute the Book upon the expiration or termination of this
Agreement. Licensee acknowledges and agrees that, in addition to any
and all other remedies available to Licensor, Licensor shall have the
right to have any such activity by Licensee restrained by equitable
relief, including, but not
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
limited to, a temporary restraining order, a preliminary injunction,
a permanent injunction, or such other alternative relief as may be
appropriate, without the necessity of Licensor posting any bond.
39. POWER TO SIGN
The parties warrant and represent that their respective
representatives signing this Agreement have full power and proper
authority to sign this Agreement and to bind the parties.
40. CONFIDENTIALITY
40.1 Licensee represents and warrants that Licensee did not trade
on the prospect of a license from Licensor, prior to full
execution of this Agreement. Licensee agrees to keep the
terms and conditions of this Agreement confidential, and
Licensee shall not disclose such terms and conditions to any
third party without obtaining Licensor's prior written
consent; provided, however, that the terms and conditions of
this Agreement may be disclosed on a need-to-know basis to
Licensee's outside attorneys and accountants who agree to be
bound by this confidentiality provision. In addition,
Licensee may have access to information concerning
Licensor's and/or its Affiliates' business and operations,
and/or information concerning works in progress, artwork,
plots, characters or other matters relating to Licensor's
and/or its Affiliates' artistic creations, which information
may not be accessible or known to the general public.
Licensee agrees not to use or disclose such information to
any third party without obtaining Licensor's prior written
consent.
40.2 Licensor agrees to use reasonable care to keep confidential
those terms and conditions of this Agreement which are not
standard terms and conditions contained in Licensor's licensed
publishing agreements with other licensees, and Licensor shall
not disclose such terms and conditions to any third party
without obtaining Licensee's prior written consent;
provided, however, that the terms and conditions of this
Agreement may be disclosed on a need-to-know basis to
Licensee's outside attorneys and accountants who agree to be
bound by this confidentiality provision. In addition,
Licensor may have access to information concerning
Licensee's and/or its Affiliates' business and operations
which information may not be accessible or known to the
general public. Licensee agrees not to use or disclose such
information to any third party without obtaining Licensor's
prior written consent.
40.3 In the event either party is required to disclose the
information deemed confidential in Subparagraphs 40.1 and
40.2 above, pursuant to any law, court order or process, the
rules and regulations of any governmental department,
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
agency or authority (including, but not limited to, the
Securities and Exchange Commission) or any generally accepted
accounting rules mandating disclosure in the disclosing
party's financial statements, the disclosing party agrees to
give the non-disclosing party prior written notice and the
disclosing party shall use its best efforts to obtain
confidential treatment of the information required to be
disclosed. Upon the non-disclosing party's request, the
disclosing party agrees to incorporate, to the extent
reasonably possible, the non-disclosing party's comments
into the disclosing party's request for confidential
treatment, provided such request and comments are received
by the disclosing party within five (5) business days after
receipt the notice referred to in the preceding sentence.
40.4 Licensor and Licensee shall consult with each other before
issuing any press release or making any public statement
with respect to the execution, termination, expiration or
terms and conditions of this Agreement. and, except as may
be required by law, shall not issue any such press release
or make any public statement unless the text of such
statement shall first have been agreed upon by the parties.
41. PREVIOUS AGREEMENTS
Effective as of December 31, 1997, the 1992 Publishing License
Agreement shall be, and is hereby, terminated. This Agreement, and
any confidentiality agreement Licensee may have signed pertaining to
any of the Licensed Property, contains the entire agreement between
the parties concerning the subject matter hereof and supersedes any
pre-existing or contemporaneous agreement and any oral or written
communications between the parties.
42. SURVIVAL OF OBLIGATIONS
The respective obligations of the parties under this Agreement, which
by their nature would continue beyond the termination, cancellation
or expiration of this Agreement, including but not limited to
indemnification, insurance, payment of Royalties, and
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Golden books Publishing Company, Inc.
Agreement dated September 26, 1997
Paragraph 26 above, shall survive termination, cancellation
or expiration of this Agreement.
ACCEPTED AND AGREED:
GOLDEN BOOKS PUBLISHING DISNEY BOOK PUBLISHING, INC.
COMPANY, INC. DBA DISNEY LICENSED PUBLISHING
By: /s/ Xxxxx Xxxxxxx By: /s/ Xxx X. Xxxxx
--------------------- -------------------------
Title: President, Children's Title: Senior V.P. Disney
Publishing Group ----------------------
--------------------
Date: September 26, 1997 Date: 9-26-97
------------------- -----------------------
GOLDEN BOOKS PUBLISHING COMPANY, INC.
AGREEMENT DATED SEPTEMBER 26, 1997
SCHEDULE A
"A" PROPERTIES
[Intentionally omitted pursuant to a confidential treatment request and
separately filed with the Commission].
(18) Characters from each new major children-oriented Disney-branded
feature animation film, animation video, and Disney-branded live
action film released or re-released during the Term;
(19) Children-oriented television properties which Licensor has previously
licensed to Licensee as well as new properties which are derived from
the non-television Properties listed above and are developed by
Disney for a children-oriented television series; and
(20) New children-oriented television properties originally developed by
Disney or acquired by Disney, but only if Licensor and Licensee
mutually agree to a program whereby Licensee shall provide sufficient
publishing support for such new television property.
*Tentative title
Licensor shall determine the classification of any given property into "A",
"B" or "C" Properties, in good faith, in Licensor's absolute discretion, and
consistent with existing property classifications.
GOLDEN BOOKS PUBLISHING COMPANY, INC.
AGREEMENT DATED SEPTEMBER 26, 1997
SCHEDULE A
"B" PROPERTIES
[Intentionally omitted pursuant to a confidential treatment request and
separately filed with the Commission].
-2-
GOLDEN BOOKS PUBLISHING COMPANY, INC.
AGREEMENT DATED SEPTEMBER 26, 1997
SCHEDULE A
"B" PROPERTIES
[Intentionally omitted pursuant to a confidential treatment request and
separately filed with the Commission].
(24) Children-oriented television properties which Licensor has previously
licensed to Licensee as well as new properties which are derived from
the non-television Properties listed above and which are developed by
Disney for a children-oriented television series; and
(25) New children-oriented television properties originally developed by
Disney or acquired by Disney, but only if Licensor and Licensee
mutually agree to a program whereby Licensee shall provide sufficient
publishing support for such new television property.
*Tentative title
-3-
GOLDEN BOOKS PUBLISHING COMPANY, INC.
AGREEMENT DATED SEPTEMBER 26, 1997
SCHEDULE A
"C" PROPERTIES
[Intentionally omitted pursuant to a confidential treatment request and
separately filed with the Commission].
(19) Children-oriented television properties which Licensor has previously
licensed to Licensee as well as new properties which are derived from
the non-television Properties listed above and which are developed by
Disney for a children-oriented television series; and
(20) New children-oriented television properties originally developed by
Disney or acquired by Disney, but only if Licensor and Licensee
mutually agree to a program whereby Licensee shall provide sufficient
publishing support for such new television property.
-4-
GOLDEN BOOKS PUBLISHING COMPANY, INC.
AGREEMENT DATED SEPTEMBER 26, 1997
SCHEDULE B
FORMATS [Intentionally omitted pursuant to a
confidential treatment request and
separately filed with the Commission]*
COLOR & ACTIVITY
Activity pads **
Color-by-Number **
Color Surprise (magic) **
Easy Peel Sticker books **
Foil sticker books **
Magic slates* **
Xxxx & See Magic **
Match & Color **
My Coloring book **
My First Activity book **
Paint with water **
Paint box books **
Paint `N' Marker **
Paper doll book **
Posters to color **
Press-out activity book **
Scented sticker book **
Shaped coloring book **
Special edition coloring book **
Sticker by Number **
Sticker fun **
Super coloring book **
Super paint with water **
Tell-a-Story sticker book **
Trace & Color **
*Licensor and Licensee acknowledge that, prior to the date of this Agreement,
they entered into two license agreements, dated August 26, 1996 and March 27,
1997, whereby Licensee has been granted the right to manufacture and sell
Magic Slates(R) products utilizing the characters from Disney's Hercules and
101 Dalmatians. The parties hereby confirm that these two Magic Slates
agreements shall expire on the expiration dates set forth in those respective
agreements, unless earlier terminated, and that immediately upon such
expiration or earlier termination, Licensee's right to utilize said characters
in the Magic Slates format shall become part of and subject to the terms and
conditions of this Agreement.
**[Intentionally omitted pursuant to a confidential treatment request and
separately filed with the Commission].
For purposes of this Agreement, the term "Book," as it applies to the color
and activity format, shall include, in addition to those color and activity
formats listed hereinabove, the following:
(a) Licensee's color and activity books, in which the Licensed
Property is used, existing as of the date of this Agreement
in the format specifications (e.g., trim size and page
count) previously approved by Licensor under any prior
license agreements between Licensor and Licensee (or their
predecessors);
(b) New color and activity formats developed by Licensee which
meet each of the following criteria:
(i) Derivative of any color and activity formats
approved by Licensor under this Agreement or under
any prior license agreement between Licensor and
Licensee (or their predecessors);
(ii) Similar in price point to any color and activity
formats approved by Licensor under this Agreement
or under any prior license agreement between
Licensor and Licensee (or its predecessors); and
(iii) Subject to the same distribution channels
authorized in Subparagraph 2.3 of this Agreement.
For purposes of this Agreement, the term "Book," as it applies to the color
and activity format, shall not include the following:
(a) Any product which is or could be reasonably construed as an
entirely new category of product (e.g., educational
workbooks or foreign language teaching products);
(b) Any product which includes any new or substantially new
technology, or a key component of which, was not
contemplated by the scope of the authorized color and
activity formats licensed hereunder (e.g., a talking
coloring book or a color and activity book with a toy or
audiocassette);
(c) Any product which has been licensed by Licensor to another
licensee as of the date of this Agreement, but only for the
duration of the term of such license(s); and
(d) Any product which, in whole or in part, falls outside of
Licensor's customary licensed publishing business or which
is published, manufactured or licensed or being published,
manufactured or licensed by Licensor's Affiliates.
-2-
GOLDEN BOOKS PUBLISHING COMPANY, INC.
AGREEMENT DATED SEPTEMBER 26, 1997
SCHEDULE B
FORMAT [Intentionally omitted pursuant to a
confidential treatment request and
separately filed with the Commission]*
STORYBOOK
Deluxe Super Shape book ***
Little Golden book ***
Look Look book ***
Super Shape book ***
First Little Golden book ***
Sturdy Shape book** ***
Little Look Look book ***
Little Little Golden book (2-pack) ***
Little Super Shape ***
Little Golden Storybook ***
*Books are to be of a type and quality designed to sell for the suggested
retail prices, provided, however, that Licensee has the absolute discretion to
price the books as Licensee deems appropriate.
**Subject to Subparagraph 2.1 of this Agreement.
***[Intentionally omitted pursuant to a confidential treatment request and
separately filed with the Commission].
For purposes of this Agreement, the term "Book" as it applies to the storybook
format shall include, in addition to those storybook formats listed above,
storybooks developed by Licensee which contain minor modifications (e.g., trim
size and page count) to the specifications of the storybook formats listed
hereinabove and which are subject to the same distribution channels authorized
in Subparagraph 2.3 of this Agreement. Nothing in this Agreement shall
preclude Licensee from submitting for Licensor's consideration new storybook
opportunities.
-3-
GOLDEN BOOKS PUBLISHING COMPANY, INC.
AGREEMENT DATED SEPTEMBER 26, 1997
SCHEDULE C
[Two pages of text intentionally omitted pursuant to a confidential treatment
request and separately filed with the Commission].
SUPPLIER'S AGREEMENT
EXHIBIT 1
SUPPLIER:
------------------
------------------
------------------
Reference is made to the license agreement dated ________ between Disney
Licensed Publishing ("Licensor") and ___________ ("Licensee") in which
Licensor has licensed the publication by Licensee of
________________________________ (the "publication"). Licensor hereby
authorizes you to prepare, from material supplied to you by Licensee and/or
Licensor, reproduction material, including as applicable film positives, four
color separations, photographs, transparencies, film negatives, black
separations, black keyplate proofs and other reproduction material used in the
manufacture of the publication, upon the condition that the Supplier shall
sign and fully comply in all respects with this agreement. Failure of said
condition shall entitle Licensor to terminate this agreement forthwith. The
property rights (including but not limited to copyright and physical
ownership) in all such materials shall remain vested in Disney Enterprises,
Inc., at all times. Said reproduction material will be delivered by you to no
one other than Licensee, or as Licensor may otherwise direct. Licensor shall
be under no obligation to you with respect to such charges as may be incurred
in connection with reproduction material prepared at the request of Licensee.
The Supplier signing below agrees that (except as may be authorized under a
separate agreement with Licensor):
1. The Supplier will not manufacture the publication or
components thereof to the order of anyone but the Licensee,
will invoice only the Licensee, will not ship to anyone
other than the Licensee or Licensee's designees and will not
ship after the expiration date of the License Agreement.
2. The Supplier will not subcontract production of the
publication or components thereof without Licensor's written
consent.
3. The Supplier will not (without Licensor's written consent)
manufacture the publication or components thereof listed
above, other than in accordance with this agreement.
4. From time to time, the Supplier will permit Licensor's
authorized representatives to inspect its activities and
premises, accounting books and invoices relevant to its
manufacture and supply of the publication.
5. The Supplier will not publish or cause the publication of
pictures from the
publication in any other publication or promotional
material, nor advertise the fact that it is permitted to
manufacture the publication or components thereof, nor use
the name "Disney" or any variant thereof without Licensor's
prior written consent.
6. In manufacturing the publication, the Supplier will comply
with all applicable laws, regulations, voluntary industry
standards, codes, or other obligations (collectively
"Laws"), including but not limited to, applicable health and
safety standards and labor laws for manufacturing
operations. Specifically, the Supplier covenants that:
(a) The Supplier agrees not to use child labor in the
manufacturing or packaging of the publication or
components thereof. The term "child" refers to a
person younger than the age for completing
compulsory education, but in no case shall any
child younger than fourteen (14) years of age be
employed in the manufacturing or packaging of the
publication or components thereof.
(b) The Supplier agrees to provide employees with a
safe and healthy workplace in compliance with all
applicable Laws. The Supplier agrees to provide
Licensor with all information Licensor may request
about manufacturing or packaging facilities for the
publication or components thereof.
(c) The Supplier agrees only to employ persons whose
presence is voluntary. The Supplier agrees not to
use prison labor, or to use corporal punishment or
other forms of mental or physical coercion as a
form of discipline of employees.
(d) The Supplier agrees to comply with all applicable
wage and hour Laws, including minimum wage,
overtime, and maximum hours. The Supplier agrees to
utilize fair employment practices as defined by
applicable Laws.
(e) The Supplier agrees not to discriminate in hiring
and employment practices on grounds of race,
religion, national origin, political affiliation,
sexual preference, or gender.
(f) The Supplier agrees to comply with all applicable
environmental Laws.
(g) The Supplier agrees that Licensor may engage in
activities such as unannounced on-site inspections
of manufacturing or packaging facilities in order
to monitor compliance with applicable Laws.
7. Upon expiration or termination of the License Agreement, or
upon notification by Licensor or Licensee, you will
immediately cease manufacturing the publication and deliver
to Licensor or its authorized representative such
reproduction
-2-
materials as are necessary for printing, and shall deliver
to Licensee, or to Licensor if Licensor so requests, all
artwork, textual and reproduction materials for the
publication which Licensor or Licensee may have caused to be
furnished to you, and all original and reproduction material
prepared by you hereunder, unless Licensee has engaged you
to do the printing, in which case you will deliver such
original and reproduction material at such other time as
Licensor may direct, or in the absence of such direction,
upon completion of your use of such original and
reproduction materials for the printing of the publication.
Said materials shall be so delivered without charge other
than the expense of delivery, and shall be complete and in
reproduction condition. You agree to provide Licensor upon
request, a statement and/or a duplicate invoice as to all
materials provided to Licensee hereunder.
DISNEY LICENSED PUBLISHING ACCEPTED AND AGREED BY:
By: By:
-------------------------------- ----------------------------
(to be signed by Supplier)
Title: Title:
----------------------------- -------------------------
Company:
---------------------------
-3-
EXHIBIT 2
WORK FOR HIRE AGREEMENT/COPYRIGHT ASSIGNMENT
The undersigned agrees that for valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, all literary and/or artistic
Work (collectively the "Work") written or otherwise created by the undersigned
in connection with the publication tentatively entitled
___________________________________ (the "Publication") was written and/or
otherwise created by the undersigned as a work made for hire for Disney
Enterprises, Inc. ("Disney") pursuant to an agreement between the undersigned
and _________________ ("Publisher") dated ________________________. The
undersigned acknowledges that the Work was specially ordered or commissioned
for use as a contribution to the Publication, that Disney owns throughout the
universe in perpetuity all right, title and interest in the Work and the
results and proceeds of the undersigned's services, that Disney shall be
deemed the author of the Work for purposes of copyright and that Disney is
entitled to the copyright(s) therein (and all renewals and extensions
thereof), with the right to make such changes in the Work and uses thereof as
Disney may from time to time determine within its sole discretion. The
undersigned also assigns to Disney all now known and hereafter existing rights
of every kind (including the copyright and all renewals and extensions
thereof), throughout the universe in perpetuity and in all languages,
pertaining to the Work for all now known and hereafter existing uses, media,
and forms. The undersigned hereby waives any claims that the undersigned may
now or hereafter have in any jurisdiction to so-called "moral rights" or
rights of "droit moral" with respect to the Work.
The undersigned represents and warrants that, except as to any material
provided to the undersigned by Publisher and/or Disney and incorporated in the
Work, the Work is wholly original with the undersigned who is the sole creator
thereof, the Work does not violate the rights of any third party, the Work is
not the subject of any litigation or claim that might give rise to litigation,
and that the undersigned has all rights necessary to convey the rights granted
to Disney herein. The undersigned agrees to indemnify and hold harmless
Publisher and Disney, their respective parent and affiliated companies,
successors, licensees, and assigns against any breach of any of the foregoing
representations and warranties. The undersigned agrees to execute such further
documents and do such other acts as may be required by Disney to evidence or
effectuate Disney's rights hereunder. Failure to do so shall automatically
empower Disney as the undersigned's attorney-in-fact to execute such documents
and do such acts in the place and stead of the undersigned. Disney's rights in
the Work may be assigned, licensed, or otherwise transferred by Disney, and
this Agreement shall inure to the benefit of Publisher's and Disney's
respective successors, licensees, and assignees.
Print Name:
-------------------------
Signature:
--------------------------
Address:
----------------------------
------------------------------------
Date:
-------------------------------
EXHIBIT 3
CODE OF CONDUCT FOR SUPPLIERS
At The Xxxx Disney Company, we are committed to:
o a standard of excellence in every aspect of our business and in
every corner of the world;
o ethical and responsible conduct in all of our operations;
o respect for the rights of all individuals; and
o respect for the environment.
We expect these same commitments to be shared by all suppliers of Disney
publications. At a minimum, we require that all suppliers of Disney
publications meet the following standards:
CHILD LABOR Suppliers will not use child labor.
The term "child" refers to a person
younger than 15 (or 14 where local
law allows) or, if higher, the local
legal minimum age for employment or
the age for completing compulsory
education.
Suppliers employing young persons who
do not fall within the definition of
"children" will also comply with any
laws and regulations applicable to
such persons.
INVOLUNTARY LABOR Suppliers will not use any
forced or involuntary labor, whether
prison, bonded, indentured or
otherwise.
COERCION AND
HARASSMENT Suppliers will treat each employee
with dignity and respect, and will
not use corporal punishment, threats
of violence or other forms of
physical, sexual, psychological or
verbal harassment or abuse.
NONDISCRIMINATION Suppliers will not discriminate in
hiring and employment practices,
including salary, benefits,
advancement, discipline, termination
or retirement, on the basisof race,
religion, age, nationality, social or
ethnic origin, sexual orientation,
gender, political opinion or
disability.
ASSOCIATION Suppliers will respect the rights of
employees to associate, organize and
bargain collectively in a lawful and
peaceful manner, without penalty or
interference.
HEALTH AND SAFETY Suppliers will provide
employees with a safe and healthy
workplace in compliance with all
applicable laws and regulations,
ensuring at a minimum, reasonable
access to potable water and sanitary
facilities, fire safety, and adequate
lighting and ventilation.
Suppliers will also ensure that the
same standards of health and safety
are applied in any housing that they
provide for employees.
COMPENSATION We expect suppliers to recognize that
wages are essential to meeting
employees' basic needs. Suppliers
will, at a minimum, comply with all
applicable wage and hour laws and
regulations, including those relating
to minimum wages, overtime, maximum
hours, piece rates and other elements
of compensation, and provide legally
mandated benefits. If local laws do
not provide for overtime pay,
suppliers will pay at least regular
wages for overtime work. Except in
extraordinary business circumstances,
suppliers will not require employees
to work more than the lesser of (a)
48 hours per week and 12 hours
overtime or (b) the limits on regular
and overtime hours allowed by local
law or, where local law does not
limit the hours of work, the regular
work week in such country plus 12
hours overtime. In addition, except
in extraordinary business
circumstances, employees will be
entitled to at least one day off in
every seven-day period.
Where local industry standards are
higher than applicable legal
requirements, we expect suppliers to
meet the higher standards.
PROTECTION OF THE
ENVIRONMENT Suppliers will comply with all
applicable environmental laws and
regulations.
-2-
OTHER LAWS Suppliers will comply with all
applicable laws and regulations,
including those pertaining to the
manufacture, pricing, sale and
distribution of publications.
All references to "applicable laws
and regulations" in this Code of
Conduct include local and national
codes, rules and regulations as well
as applicable treaties and voluntary
industry standards.
SUBCONTRACTING Suppliers will not use subcontractors
for the manufacture of Disney
publications or components thereof
without Disney's express written
consent, and only after the
subcontractor has entered into a
written commitment with Disney to
comply with this Code of Conduct.
MONITORING AND
COMPLIANCE Suppliers will authorize Disney and
its designated agents (including
third parties) to engage in
monitoring activities to confirm
compliance with this Code of Conduct,
including unannounced on-site
inspections of manufacturing
facilities and employer-provided
housing; reviews of books and records
relating to employment matters; and
private interviews with employees.
Suppliers will maintain on site all
documentation that may be needed to
demonstrate compliance with this Code
of Conduct.
PUBLICATION Suppliers will take appropriate steps
to ensure that the provisions of this
Code of Conduct are communicated to
employees, including the prominent
posting of a copy of this Code of
Conduct, in the local language and in
a place readily accessible to
employees, at all times.
-3-
EXHIBIT 4
CODE OF CONDUCT FOR LICENSEES
At The Xxxx Disney Company, we are committed to:
o a standard of excellence in every aspect of our business and
in
o every corner of the world; ethical and responsible conduct in
o all of our operations; respect for the rights of all
o individuals; and respect for the environment.
We expect these same commitments to be shared by all Disney licensees and the
suppliers with which they work in the production of Disney publications. At a
minimum, we require that all Disney licensees meet the following standards:
CONDUCT OF
MANUFACTURING Licensees that engage directly in the manufacturing
of Disney publications will comply with all of the
standards set forth in Disney's Code of Conduct for
Suppliers, a copy of which is attached.
Licensees will ensure that each manufacturer other
than the licensee also enters into a written
commitment with Disney to comply with the standards
set forth in Disney's Code of Conduct for
Suppliers.
Licensees will prohibit suppliers from
subcontracting the manufacture of Disney
publications or components thereof without Disney's
express written consent, and only after the
subcontractor has entered into a written commitment
with Disney to comply with Disney's Code of Conduct
for Suppliers.
MONITORING AND
COMPLIANCE Licensees will take appropriate steps, in
consultation with Disney, to develop, implement and
maintain procedures to evaluate and monitor
suppliers of Disney publications and ensure
compliance with Disney's Code of Conduct for
Suppliers, including unannounced on-site
inspections of manufacturing facilities and
employer-provided housing; review of books and
records relating to employment matters; and private
interviews with employees.
Licensees will authorize Disney and its designated
agents (including third parties) to engage in
similar monitoring activities to confirm Licensees'
compliance with this Code of Conduct. Licensees
will maintain on site all documentation that may be
needed to demonstrate such compliance.
EXHIBIT 5
DISNEY SPECIAL MARKETS APPROVAL FORM
APPROVAL ONLY
--------------------------------------------
APPROVAL & SPECIAL ROYALTY RATE
--------------------------------------------
DATE SUBMITTED
--------------------------------------------
DATE APPROVAL NEEDED
--------------------------------------------
GOLDEN SALESPERSON
--------------------------------------------
GOLDEN START SHIP
--------------------------------------------
GOLDEN END SHIP
--------------------------------------------
ITEM # FORMAT TITLE SRP
---------- ---------- --------- -------
---------- ---------- --------- -------
---------- ---------- --------- -------
---------- ---------- --------- -------
---------- ---------- --------- -------
---------- ---------- --------- -------
---------- ---------- --------- -------
---------- ---------- --------- -------
---------- ---------- --------- -------
TOTAL
---------- ---------- --------- -------
SPECIFICATION CHANGES TO TITLES:
NONE DESCRIPTION OF CHANGES
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CUSTOMER
--------------------------------------------
CUSTOMER USE
--------------------------------------------
CUSTOMER RETAIL
--------------------------------------------
SELL PRICE
--------------------------------------------
PROJECTED UNITS
--------------------------------------------
TOTAL SALES
--------------------------------------------
-----------------------------------------------------------------------------
ROYALTY RATE
-----------------------------------------------------------------------------
UNIT RATE
-----------------------------------------------------------------------------
TOTAL ROYALTY
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
GOLDEN BUSINESS DEVELOPMENT APPROVAL: DATE
----------------------------------------------------- -----------------
GOLDEN SPECIAL MARKETS APPROVAL: DATE
----------------------------------------------------- -----------------
DISNEY APPROVAL: DATE
-----------------
-----------------------------------------------------
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COMMENTS/APPROVAL CONDITIONS
-----------------------------------------------------------------------------
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EXHIBIT 6