5
ASSET PURCHASE AND LICENSE AGREEMENT
THIS ASSET PURCHASE AND LICENSE AGREEMENT (this “Agreement”) is dated March 28,
2016, and is between Smart Kids, LLC, a California limited liability company
(“Seller”) and Athena Brands, Inc., a Nevada corporation (“Buyer”).

WHEREAS, the Seller owns the trademark Kids 50 (the “Trademark”) and has
licensed the rights to the trademark YoGabbaGabba (“Licensed Mark”) from
GabbraCaDabra, LLC under a License Agreement dated May 9, 2012 (the “License
Agreement”) (the Trademark and the License Agreement listed on Schedule A and
hereinafter referred to as the “Assets”); and

WHEREAS, the Seller desires to (i) license and later sell, and the Buyer desires
to license to use with an option to buy, the Trademark and (ii) sublicense the
Licensed Mark on the terms and conditions set forth in this Agreement;

NOW, THEREFORE, in consideration of the foregoing premises and the respective
representations, warranties, covenants and agreements contained in this
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and intending to be legally bound
hereby, the parties agree as follows:
ARTICLE I

ARTICLE IILICENSE WITH OPTION TO BUY
1.Agreement to License Trademark. Upon execution of this Agreement, and for a
period of eight (8) months thereafter, the Seller agrees to exclusively license
to the Buyer, and the Buyer agrees to exclusively license from the Seller all of
Seller’s rights, title and interest in and to the Trademark, free and clear of
any claims, liabilities, security interests, mortgages, liens, pledges,
conditions, charges or encumbrances of any nature whatsoever subject to the
License Fee set forth below. During the term of the License of the Trademark and
if the purchase option is exercised at all times thereafter, Seller shall not
use or license the Trademark in any way and Buyer shall have the right to
enforce the Trademark as if Buyer owned the Trademark. Seller shall cooperate
with Buyer in any action to enforce the Trademark. Buyer shall not take any
action that disparages or dilutes the Trademark during the term of the License
of the Trademark. Until the option is exercised, Seller shall pay all
registration or renewal fees for the Trademarks and continue to maintain the
Trademarks.
2.Agreement to Extension of the License Agreement. Seller and Buyer also agree
to enter into a Assignment and Extension of the License Agreement in the form of
Exhibit A pursuant to which all of Seller’s right, title and interest under the
License Agreement will be assigned to Buyer. The final execution of the
Assignment and Extension of the License Agreement including the agreement of all
necessary third-parties is a pre-requisite for all the terms of this Agreement.
3.Liabilities. The Buyer is not assuming, paying or discharging or in any
respect becoming liable for any liability, obligation, commitment or expense of
the Seller, except for the $31,750 set forth in the last sentence of this
Section 1.3, which represents the reconciliation and payment of the remaining
money due to Seller from Avanzar Sales and Distribution, LLC (“Avanzar”). Buyer
acknowledges that Avanzar currently holds proceeds from the sale of product of
the Seller in the amount of $28,000. Buyer also acknowledges that it will
purchase the remaining finished goods of Seller for $3,750. Buyer agrees to pay
Seller the aggregate amount of $31,750 payable in six (6) installments of
$5,291.67, with the first payment due thirty (30) days from closing and every
thirty (30) days thereafter until all 6 installments are paid.
4.Without limitation of the foregoing and notwithstanding anything in this
Agreement to the contrary (other than stated above), the Buyer shall not assume,
pay or discharge, and shall not be liable for, and the Seller shall discharge,
as well as indemnify and hold the Buyer harmless from and against, any
liability, loss, commitment, obligation or expense of the Seller incident to, or
arising out of
(a)    the negotiation and preparation of, or performance under this Agreement
or the Assignment and Bill of Sale, including, without limitation, costs
incurred in connection with the assignment and sale of the Assets;

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(b)    any claims, actions, suits, proceedings, liabilities, fines, penalties,
deficiencies or judgments existing on the Closing Date or arising any time
thereafter as a result of or in connection with the use of the Trademark or the
License Agreement, including, without limitation, the ownership or use of the
Trademark by Seller, and the conduct of its business up to and including the
Closing Date; or
(c)     any liabilities of any nature whatsoever of the Seller, including, but
not limited to, any tax liabilities on account of this Agreement or the
operations of the Seller up to and including the Closing Date.
1.5    License Fee for Trademark. The consideration (the “License Fee ”) payable
by the Buyer to the Seller for the License of the Trademark shall equal an
aggregate of $80,000 of which: (i) $10,000 shall be payable upon execution of
this Agreement and $10,000 shall be payable every month thereafter until a total
of $80,000 has been paid. At the end of eight months, the License of the
Trademark shall expire unless Buyer exercises its right to purchase the
Trademark as set forth in Section 1.5.
1.6     Buyer’s Option to Purchase Trademark. If, and only if, all payments of
the License Fee are made on time and in full as set forth in Section 1.5, and
all payments required of Buyer to Seller are made in full and on time in
accordance with Section 1.3, and there are no outstanding payments owed by Buyer
to Seller for the Finished Goods or Raw Materials as set forth in Section 1.3,
then Buyer shall have the right to purchase the Trademark by issuing Two Million
Five Hundred Thousand (2,500,000) shares of Minerco common stock (OTC:MINE) to
Seller. If the Buyer properly exercises the option to purchase the Trademark by
sending written notice to Seller of its intent to exercise, the Seller shall
transfer the Trademark to Seller free and clear of any claims, liabilities,
security interests, mortgages, liens, pledges, conditions, charges or
encumbrances of any nature whatsoever.
1.7    Bonus. In addition to all other payments due from Buyer to Seller, if
Buyer exercises the option to purchase the Trademark as set forth in Section
1.6, then Buyer shall also pay to Seller an additional $50,000 bonus if net
revenues exceed $2,000,000 in the eighteen (18) months from and after April 1,
2016. The Bonus is payable in cash but at mutual agreement of parties, it can be
paid in stock of Minerco, cash or combination of both.

ARTICLE III

Seller Representations

The Seller represents to the Buyer as of the date of this Agreement and as of
the Closing Date as follows:

1.Organization. The Seller is a limited liability company duly organized,
validly existing, and in good standing under the laws of California, with all
power and authority necessary to own or use its assets and conduct its business
as it is now being conducted. The Seller is duly qualified to do business as a
foreign corporation in, and is in good standing under the laws of, each state or
other jurisdiction in which the failure to be so qualified or in good standing
would have a material adverse effect on (i) its ability to perform its
obligations under this Agreement or (ii) the assets, financial position, or
results of operations of the Seller.
2.Authority. The Seller has full power and authority to execute and deliver this
Agreement, the Sub-License Agreement and the Assignment and to perform its
obligations hereunder and thereunder. The execution and delivery of this
Agreement, the Sub-License Agreement and the Assignment and performance by the
Seller of its obligations hereunder and thereunder have been duly authorized by
the members and the managers of the Seller and no other proceedings on the part
of the Seller is necessary with respect thereto.
3.Enforceability. This Agreement, the Sub-License Agreement and the Assignment
constitute the valid and binding obligations of Seller, except as enforceability
is limited by: (i) any applicable bankruptcy, insolvency, reorganization,
moratorium, or similar law affecting creditors’ rights generally; or
(ii) general principles of equity, whether considered in a proceeding in equity
or at law.
4.No Violations. The execution and delivery of this Agreement, the Sub-License
Agreement and the Assignment by the Seller and the performance of its
obligations hereunder and thereunder do not: (i) conflict with, result in a
breach of, constitute a default under (or an event that, with notice or lapse of
time or both, would constitute a default under), accelerate the performance
required by, result in the creation of any lien or encumbrance (“Lien”) on any
of the properties or assets of the Seller under, or create in any party the
right to accelerate, terminate, modify, or

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cancel, or require any notice under, any contract to which the Seller is a party
or by which any properties or assets of Seller is bound, or (ii) to the
contravene, conflict with, or violate any federal, state, local, municipal,
foreign, international, multinational or other administrative order,
constitution, law, ordinance, principle of common law, regulation, statute, or
treaty or award, decision, injunction, judgment, order, ruling, subpoena, or
verdict of any court, arbitral tribunal, administrative agency, or other
Governmental Authority (as hereinafter defined) to which the Seller is subject.
5.Consents. The Seller is not required to obtain the approval, ratification,
filing, declaration, waiver, consent or other authorization (“Consent”) of any
Person, including the Consent of any party to any agreement, contract,
obligation, promise, arrangement, or undertaking that is legally binding to
which the Seller is party, in connection with execution and delivery of this
Agreement, the Sub-License Agreement and the Assignment and performance of its
obligations hereunder and thereunder.
6.Capitalization. Thomas Arndt is the majority equity holder of Seller and has
authority to execute this Agreement on behalf of shareholder of Seller.
2.7    Assets. The Seller has good and marketable title to all of the Assets,
and: (i) the Trademark is not subject to any liens, pledges, charges,
encumbrances or encroachments, or to any rights of others of any kind of nature
whatsoever; (ii) the Assets do not encroach or infringe on the property or
rights of another; and (iii) do not contravene any applicable law or ordinance
or any other administrative regulation or violates any restrictive covenant or
any provision of law. The Assets do not comprise a substantial portion of
Seller’s overall Assets. There are no agreements or arrangements between the
Seller on the one hand and any third person which have any effect upon the
Seller’s title to or other rights respecting its assets or the Assets. The Buyer
will have no liability of any nature, whether absolute, accrued, contingent or
otherwise, and whether due or to become due, including, without limitation, any
liability for taxes for any period prior to the Closing Date, by reason of its
receiving the Assets from the Seller hereunder. Further, and not in limitation
of any of the foregoing provisions of this Section 2.7. The Trademark does not
infringe upon or misappropriate the intellectual property rights of any third
party, nor has Seller received any notice or claim of any such infringement or
misappropriation.

(a)    the Seller has the full right and power to transfer the Trademark and
assign the License Agreement;

(b)    the Seller has the exclusive right to bring actions for the infringement
of, and each has taken all actions and made all applicable applications and
filings pursuant to relevant federal, state and local law required to perfect
and protect its interest and proprietary rights in the Trademark and the License
Agreement;

(c)    the Seller does not have any present or future obligation or requirement
to compensate any person with respect to the Trademark or License Agreement,
whether by the payment of royalties or not, or whether by reason of the
ownership, use, license, lease, sale or any commercial use or any disposition
whatsoever of any of its assets; and

(d)    none of the present or former employees of the Seller own directly or
indirectly, or has any other right or interest in, in whole or in part, any of
the Trademark.

2.8    Compliance with Law. The Seller is not in violation of any laws,
governmental orders, rules or regulations, whether federal, state or local, to
which it or any of its properties are subject, which may have a material adverse
affect as to the Trademark or the Sub-License Agreement or the License
Agreement.
    
2.9    Litigation. There are no actions, suits, proceedings or investigations
pending or, to the knowledge of the Seller, threatened against or affecting the
Assets whether at law or in equity or admiralty or before or by any federal,
state, municipal or other governmental department, commission, board, agency,
court or instrumentality, domestic or foreign; the Seller is not operating
under, subject to, in violation of or in default with respect to, any judgment,
order, writ, injunction or degree of any court or federal, state, municipal or
other governmental department, commission, board, agency or instrumentality
domestic or foreign related to the Assets. No inquiries have been made directly
to the Seller by any governmental agency which might form the basis of any such
action, suit, proceeding or investigation.

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2.10    Solvency. Immediately after the Closing (i) the Seller expects to be
able to pay all creditors in a timely manner; and (ii) no solvency proceeding of
any character, including bankruptcy, receivership, reorganization, composition
or arrangement with creditors (including any assignment for the benefit of
creditors), voluntary or involuntary, affecting the Assets or the Seller is
pending or is currently being contemplated by Seller or, to the knowledge of
Seller, is being threatened against Seller. The Seller has not made any
assignment for the benefit of creditors or taken any action in contemplation of,
or which would constitute the basis for, the institution of any such insolvency
proceedings.

2.11    Accredited Investor. The Seller (i) is a sophisticated person with
respect to the purchase of the Shares of Minerco; (ii) has adequate information
concerning the business and financial condition of Minerco to make an informed
decision regarding the sale of the Shares; and (iii) has independently and
without reliance upon the Buyer, and based on such information as the Seller has
deemed appropriate, made its own analysis and decision to enter into this
Agreement, except that the Seller has relied upon the Buyer’s express
representations, warranties and covenants in this Agreement. Seller is an
“accredited investor” and is aware that the shares being acquired by it are
subject to restrictions on transfer pursuant to the Securities Act of 1933, as
amended (the “Securities Act”). The Seller is acquiring the Shares for its own
account and not with a view towards, or for resale in connection with, the
public sale or distribution thereof, except pursuant to sales registered or
exempted under the Securities Act.

2.12    Brokers. No Person has acted as broker, finder, or investment advisor
for the Seller or has entered into any contract with ether or any Affiliate of
either to act as such.
ARTICLE IV

ARTICLE VBUYER REPRESENTATIONS
The Buyer represents to the Seller as of the date of this Agreement and as of
the Closing Date as follows:
1.Organization and Good Standing. The Buyer is an entity duly organized, validly
existing, and in good standing under the laws of the State of Nevada, with all
power and authority necessary to own or use its assets and conduct its business
as it is now being conducted. The Buyer is duly qualified to do business as a
foreign corporation in, and is in good standing under the laws of, each state or
other jurisdiction in which the failure to be so qualified or in good standing
would have a material adverse effect on (i) its ability to perform its
obligations under this Agreement or (ii) its assets, financial position, or
results of operations.
2.Authority. The Buyer has full power and authority to execute and deliver this
Agreement, the Sub-License Agreement and the Assignment and to perform its
obligations hereunder. Execution and delivery of this Agreement, the Sub-License
Agreement and the Assignment by the Buyer and performance by each of its
obligations hereunder and thereunder has been duly authorized by the board of
directors of the Buyer and no other proceedings on the part of the Buyer is
necessary with respect thereto.
3.Enforceability. This Agreement, the Sub-License Agreement and the Assignment
constitutes the valid and binding obligation of the Buyer, enforceable in
accordance with each of their terms, except as enforceability is limited by
(i) any applicable bankruptcy, insolvency, reorganization, moratorium, or
similar law affecting creditors’ rights generally or (ii) general principles of
equity, whether considered in a proceeding in equity or at law.
4.Consents. The Buyer is not required to obtain the Consent of any Person,
including the Consent of any party to any Contract to which it is party, in
connection with execution and delivery of this Agreement and performance of its
obligations hereunder.
5.No Violations. Execution and delivery by the Buyer of this Agreement, the
Sub-License Agreement and the Assignment and performance of its obligations
hereunder and thereunder do not: (i) violate any provision of its organizational
documents as currently in effect; (ii) conflict with, result in a breach of,
constitute a default under (or an event that, with notice or lapse of time or
both, would constitute a default under), accelerate the performance required by,
result in the creation of any Lien on any of it properties or assets under, or
create in any party the right to accelerate, terminate, modify, or cancel, or
require any notice under, any Contract to which it is a party or by which any of
its properties or assets are bound; or (iii) to the Knowledge of Buyer,
contravene, conflict with, or violate any law or order to which it is subject.

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ARTICLE VI

ARTICLE VIIthe closing
1.Closing. The parties shall hold the closing of the transactions contemplated
by this Agreement (the “Closing”) at 10:00 A.M. on December , 2015 or at such
other time and place as the parties agree (the date of the Closing, the “Closing
Date”).
2.Deliveries by Seller to Buyer. At or before the Closing, the Seller shall
deliver to the Buyer the following:
(a)an Assignment substantially in the form annexed hereto as Exhibit B duly
executed by the Seller;
(b)resolutions adopted by the members of the Seller authorizing the Seller to
execute and deliver this Agreement and the Assignment;
(c)a certificate of the managing member of the Seller that the representations
and warranties of the Seller set forth herein are true and correct on and as of
the Closing Date as though such representations and warranties were made as of
such date;
3.Deliveries by Buyer to Seller. At or before the Closing, the Buyer shall
deliver to the Seller the following:
(a)resolutions adopted by the board of directors of the Buyer authorizing the
Buyer to execute and deliver this Agreement and the Assignment and to perform
its obligations hereunder and thereunder;
(b)    the Sub-License Agreement duly executed by the Buyer;

(c)    a certificate of the President of Buyer that the representations and
warranties of the Buyer set forth herein are true and correct on and as of the
Closing Date as though such representations and warranties were made as of such
date;
(d)     initial payment of Ten Thousand Dollars ($10,000); and
(e)     certificates evidencing Two Million Five Hundred Thousand (2,500,000)
shares of Common Stock of Minerco, provided, however, that such shares shall not
be delivered until Seller fully transfers the Trademark to the Buyer.
4.4     Conditions to Buyer’s Obligation. The Buyer’s obligation to purchase the
Assets shall be subject to satisfaction, on or before the Closing Date, of the
following conditions:

(a)     Representations and Warranties Correct; Performance. The representations
and warranties of the Seller contained in this Agreement (including the Exhibits
and Schedules hereto) in connection with the transactions contemplated by this
Agreement shall be true, complete and accurate when made and on and as of the
Closing Date as though such representations and warranties were made at and as
of such date. The Seller shall have duly and properly performed, complied with
and observed each of its covenants, agreements and obligations contained in this
Agreement to be performed, complied with and observed on or before the Closing
Date.

(b)     Purchase Permitted by Applicable Laws. The purchase of and payment for
the Assets to be purchased by the Buyer hereunder shall not be prohibited by any
applicable law or governmental regulation.

(c)     Proceedings; Receipt of Documents. All corporate and other proceedings
taken or required to be taken by the Seller in connection with the transactions
contemplated hereby and all documents incident thereto shall have been taken and
shall be reasonably satisfactory in form and substance to the Buyer, and the
Buyer shall have received all such information and such counterpart originals or
certified or other copies of such documents as the Buyer may reasonably request.
    
(d)     No Adverse Decision. There shall be no action, suit, investigation or
proceeding pending or threatened by or before any court, arbitrator or
administrative or governmental body which seeks to restrain, enjoin, prevent the
consummation of or otherwise affect the transactions contemplated by this
Agreement or questions the validity or legality of any such transactions or
seeks to recover damages or to obtain other relief in connection with any such
transactions.

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(e)     Delivery of Documents. Seller shall have delivered, or caused to be
delivered, to Buyer the consents, agreements, schedules, documents and exhibits
required by this Agreement to be delivered by Seller at or before the Closing.

(f)    Approvals and Consents. The Seller shall have obtained all
authorizations, consents, rulings, approvals, licenses, franchises, permits and
certificates, or exemptions therefrom, by or of all governmental authorities and
non-governmental administrative or regulatory agencies having jurisdiction over
the parties hereto, this Agreement, the Assets, or the transactions contemplated
hereby, including, without limitation, all third parties pursuant to existing
agreements or instruments by which the Seller may be bound, which are required
for the execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby, at no cost or other
adverse consequence to the Buyer and all thereof shall be in full force and
effect at the time of Closing.

ARTICLE VIII

ARTICLE IXINDEMNIFICATION
1.Indemnity Against Claims.
(a)     The Seller hereby agrees to indemnify and hold Purchaser (the
"Indemnified Party"), harmless from and against the following:
(i)Any and all liabilities, losses, damages, claims, costs and reasonable
expenses suffered by the Indemnified Party (whether awarded against the
Indemnified Party or paid by the Indemnified Party in settlement of a claim as
provided in Section 5.2 or otherwise suffered), resulting from the breach of any
representation or non-fulfillment of any covenant on the part of the Seller
contained in this Agreement or in any written statement, attachment, schedule,
exhibit or certificate furnished or to be furnished by the Seller to Purchaser
pursuant hereto;
(ii)Any and all actions, suits, proceedings, demands, assessments or judgments,
costs and reasonable expenses (including reasonable attorneys' fees) incident to
any of the foregoing;
(iii)any liability or cost arising out of the manner in which Seller compensates
their employees and other persons who work or have worked for Seller; and
(iv)past taxes (including interest, penalties, etc.) imposed in respect of the
income, business, property or operations of Seller, or for which any member of
Seller may otherwise be liable for the period up to and including the Closing
Date.
(b)    The amount of any loss subject to indemnification hereunder shall be
calculated net of any amounts which have been previously recovered by the
Indemnified Party under insurance policies or other collateral sources, and the
Indemnified Party hereby covenants that it will not release any such collateral
sources from any obligations it may have. In the event any such insurance
proceeds or other payments are not received before any claim for indemnification
is paid pursuant to this Agreement, then the Indemnified Party shall have the
right (but not the obligation) to exclusively pursue such collateral sources,
provided it does so with reasonable diligence, and in the event it receives any
recovery, then the amount of such recovery shall be applied first to reimburse
the Indemnified Party for its out of pocket expenses expended in pursuing such
recovery, second to refund any payment made which would not have been so paid
had such recovery from the collateral source been obtained prior to such
payment, and third, any excess to the Indemnified Party.
2.Notice of Claim, Assumption of Defense and Settlement of Claims.
(a)     Any person entitled to indemnification under this Agreement (the
“Indemnitee”) shall promptly give notice (an “Indemnification Notice”) in
accordance with Section 7.9 hereof to the parties required to provide
indemnification (collectively the “Indemnifying Party”) after the Indemnitee
shall have knowledge of any demands, claims, actions or causes of action
(singly, a “Claim” and hereinafter referred to collectively as “Claims”) which
might give rise to a Claim by the Indemnitee against the Indemnifying Party
stating the nature and basis of said Claim and amount thereof, to the extent
known. A failure to give notice hereunder shall not relieve the Indemnifying
Party from any obligation hereunder unless such failure to give notice shall
materially and adversely affect the Indemnifying Party's ability to defend the
Claim. Each such Indemnification Notice shall specify in reasonable detail the
nature and amount of the Claim and shall, to the extent available to the
Indemnitee, include such supporting

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documentation as shall reasonably be necessary to apprise the Indemnifying Party
of the facts giving rise to the Claim. After the delivery of an Indemnification
Notice certifying that the Indemnitee has incurred or had asserted against it
any liabilities, claims, losses, damages, costs or expenses for which indemnity
may be sought in accordance with the terms of this Article V (the “Damages”),
the Indemnitee shall make a claim in an amount equal to the incurred Damages or
asserted Damages, as the case may be (which, in the case of any asserted Damages
shall include the Indemnitee's reasonably estimated cost of the defense thereof,
hereinafter the “Estimated Defense Costs”). The right to indemnification hereof
and the amount or estimated amount thereof, as set forth in such notice, shall
be deemed agreed to by each Indemnifying Party unless, within thirty (30) days
after the date of such notice (the expiration of such 30-day period being
hereinafter referred to as the “Liability Notice Deadline Date”), the
Indemnified Parties are notified in writing pursuant to Section 7.9 that such
Indemnifying Party disputes the right to indemnification as set forth or
estimated in such notice or that he or she elects to defend, in the manner
hereinafter provided, the claim of a third party giving rise to such
indemnification right. If such Indemnifying Party disputes the right to
indemnification as hereinabove provided or elects to defend the claim of the
third party, the same shall be deemed determined when finally determined by a
court or tribunal from which no appeal is or may be taken or when the defense
thereto has been abandoned and if a court or tribunal from which no appeal is or
may be taken determines that the Indemnified Party was entitled to
indemnification then the Indemnifying Party shall reimburse the Indemnified
Party for the amount of Damages sought by such Indemnified Party. In the event
the amount of such Damages are not promptly reimbursed by the Indemnifying Party
as aforesaid, the amount of such unreimbursed Damages shall accrue interest from
the Liability Notice Deadline Date at a rate equal to two percent (2%) above the
applicable prime rate of Citibank, N.A.
(b)    With respect to any third party Claims made subsequent to the Closing,
the following procedures shall be observed:
(i)    Promptly after delivery of an Indemnification Notice in respect of a
Claim, the Indemnified Party may elect, by written notice to the Indemnitee, to
undertake the defense thereof with counsel reasonably satisfactory to the
Indemnitee and at the sole cost and expense of the Indemnifying Party. In the
event the Indemnifying Party elects to assume the defense of any such Claim, it
shall not, except as provided in Section 5.2(b)(ii), be liable to the Indemnitee
for any legal fees, costs and expenses incurred by the Indemnitee after the date
thereof, in connection with such defense. The Indemnitee shall have the right to
participate in, but not control the conduct of, any such action through counsel
of its own choosing, at its own expense.
(i)Unless and until the Indemnifying Party assumes the defense of the third
party Claim as provided in Section 5.2(b)(i), or in the event the Indemnifying
Party ceases to conduct such defense, the Indemnified Party may defend against
the third party Claim in any manner it reasonably may deem appropriate, at the
expense of the Indemnifying Party.
(ii)Failure by the Indemnifying Party to notify the Indemnitee of its election
to defend any such action by the Liability Notice Deadline Date shall be deemed
a waiver by the Indemnifying Party of its right to defend such action. If the
Indemnifying Party assumes the defense of any such Claim, its obligations
hereunder as to such Claim shall be limited to taking all steps necessary in the
defense or settlement of such Claim and to holding the Indemnitee harmless from
and against any and all losses, damages, expenses and liabilities awarded in any
such proceeding or arising out of any settlement approved by the Indemnifying
Party or any judgment in connection with such Claim.
(iii)The Indemnifying Party shall not, in the defense of any such Claim, consent
to the entry of any judgment or enter into any settlement with respect to the
third party Claim without the prior written consent of Indemnitee (which consent
shall not be unreasonably withheld, conditioned or delayed), except that no
consent of the Indemnitee shall be required if the judgment or proposed
settlement: (i) involves only the payment of money damages to be paid by the
Indemnifying Party and does not impose any injunction or other equitable relief
upon the Indemnitee, (ii) includes as an unconditional term thereof a full
dismissal of the litigation or proceeding with prejudice and the delivery by the
claimant or plaintiff to the Indemnitee of a release from all liability with
respect to such claim or litigation, and (iii) does not by its terms attribute
liability to the Indemnitee.
In no event will the Indemnitee consent to the entry of any judgment or enter
into any settlement with respect to the third party Claim without the prior
written consent of the Indemnifying Party, which consent shall not be
unreasonably withheld, conditioned or delayed.

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The Indemnitee will cooperate fully with the Indemnifying Party in the conduct
of any proceeding as to which the Indemnifying Party assumes the defense
hereunder. Such cooperation shall include: (i) providing the Indemnifying Party
and its counsel access to all books and records of the Indemnitee to the extent
reasonably related to such proceeding; (ii) furnishing information about the
Indemnitee to the Indemnifying Party and their counsel; (iii) making employees
available to counsel to the Indemnifying Party; and (iv) preserving the
existence of and maintaining all books and records of the Indemnitee or any
other Indemnified Party that is an entity that may reasonably be deemed to be
potentially relevant to any such proceeding until the proceeding is finally
concluded.
3.Remedies Cumulative. The remedies provided to an Indemnified Party herein
shall be cumulative and shall not preclude an Indemnified Party from asserting
any other rights or seeking any other remedies against an Indemnifying Party or
his or its respective heirs, successors or assigns. The assertion or employment
of any right or remedy hereunder, or otherwise, shall not prevent the concurrent
or subsequent assertion or employment of any other appropriate right or remedy.
ARTICLE X

ARTICLE XITERMINATION
1.Termination. This Agreement may be terminated as follows, at any time prior to
the Closing:
(a)by written agreement of the parties;
(b)by either party if the Closing has not occurred by December 31, 2015, except
that the right to terminate this Agreement in accordance with this clause (b)
will not be available to any party whose failure to fulfill any obligation under
this Agreement has been the cause of, or resulted in, the failure of the Closing
to occur on or prior to such date;
(c)by either party if a Governmental Authority issues a non-appealable final
Order having the effect of permanently restraining, enjoining or otherwise
prohibiting the transactions contemplated by this Agreement, except that the
right to terminate this Agreement pursuant to this clause (c) will not be
available to any party whose failure to comply with this Agreement has
contributed materially to the issuance of that Order;
(d)by the Buyer, if any representation of the Seller set forth in this Agreement
was inaccurate when made or becomes inaccurate as of the Closing Date; and
(e)by the Seller, if any representation of the Buyer set forth in this Agreement
was inaccurate when made or becomes inaccurate as of the Closing Date.
2.Effect of Termination. If this Agreement is terminated in accordance with
Section 6.1, all provisions of this Agreement will cease to have any effect,
except that if this Agreement is terminated by a party because another party
fails to perform or comply with any of the obligations that it is required to
perform or to comply with under this Agreement or because any representation of
another party set forth in this Agreement was inaccurate when made or becomes
inaccurate such that the representations are inaccurate on the Closing Date, the
terminating party’s right to indemnification under Article V will survive that
termination unimpaired.
ARTICLE XII

NON-COMPETE; NON-SOLICITATION.
1.Non-Compete. If Buyer exercise its right to purchase the Trademark, then for a
period commencing on the date the option is exercised and for the subsequent
three years (the “Non-Competition Period”), Seller shall not, directly or
indirectly, either for itself or any other person, own, manage, control,
materially participate in, invest in, permit her name to be used by, act as
consultant or advisor to, render material services for (alone or in association
with any person, firm, corporation or other business organization) or otherwise
assist in any manner any business which develops, markets, or sells or sells
products that are directly competitive with those sold by the Buyer or intended
to be sold by the Buyer (collectively, a “Competitor”).
2.Scope. If, at the time of enforcement of this Paragraph 10, a court shall hold
that the duration, scope, area or other restrictions stated herein are
unreasonable under circumstances then existing, the parties agree that the
maximum duration, scope, area or other restrictions reasonable under such
circumstances shall be substituted for the stated duration, scope, area or other
restrictions.
3.Independent Agreement. The existence of any claim or cause of action of Seller
against Buyer or any of its subsidiaries or affiliates, whether or not
predicated upon the terms of this Agreement, shall not constitute a defense to
the enforcement of these covenants.

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ARTICLE XIII

ARTICLE XIVMiscellaneous
1.Reasonable Efforts. Subject to the conditions of this Agreement, each of the
parties shall use the efforts that a reasonable person in the position of the
promisor would make so as to achieve that goal as expeditiously as possible
(“Reasonable Efforts”) to take, or cause to be taken, all actions, and to do, or
cause to be done, all things necessary or advisable under applicable Laws to
consummate the transactions contemplated by this Agreement as promptly as
practicable including but not limited to (i) taking such actions as are
necessary to obtain any required approval, consent, ratification, filing,
declaration, registration, waiver, or other authorization and (ii) satisfying
all conditions to Closing at the earliest possible time.
2.Transaction Costs. Each party shall pay its own fees and expenses (including
without limitation the fees and expenses of its representatives, attorneys, and
accountants) incurred in connection with negotiation, drafting, execution, and
delivery of this Agreement.
3.Assignment. No party may assign any of its rights or delegate any performance
under this Agreement except with the prior written consent of the other party.
4.Binding. This Agreement binds, and inures to the benefit of, the parties and
their respective permitted successors and assigns.
5.Governing Law. The laws of the State of California (without giving effect to
its conflict of laws principles) govern all matters arising out of this
Agreement, including without limitation tort claims.
6.Entirety of Agreement. This Agreement constitute the entire agreement of the
parties concerning the subject matter hereof and supersedes all prior
agreements, if any.
7.Further Assurances. Each party shall execute and deliver such additional
documents and instruments and perform such additional acts as the other party
may reasonably request to effectuate or carry out and perform all the terms of
this Agreement and the transactions contemplated hereby, and to effectuate the
intent of this Agreement.
8.8    Jurisdiction; Service of Process. All disputes arising out of this
Agreement shall be settled under the Rules of Arbitration of the International
Chamber of Commerce by one or more arbitrators appointed in accordance with said
Rules. The number of arbitrators shall be three, the place of arbitration shall
be California, and the language of the arbitration shall be English and the
governing law shall be the laws of the State of California.
8.9    Notices. Every notice or other communication required or contemplated by
this Agreement must be in writing and sent by one of the following methods:
(a)personal delivery, in which case delivery will be deemed to occur the day of
delivery;
(b)certified or registered mail, postage prepaid, return receipt requested, in
which case delivery will be deemed to occur the day it is officially recorded by
the U.S. Postal Service as delivered to the intended recipient; or
(c)next-day delivery to a U.S. address by recognized overnight delivery service
such as Federal Express, in which case delivery will be deemed to occur upon
receipt.
In each case, a notice or other communication sent to a party must be directed
to the address for that party set forth below, or to another address designated
by that party by written notice:
If to the Seller:
Smart Kids, LLC    
150 Pico Boulevard
Santa Monica, California 90405

If to Buyer:
Athena Brands, Inc.
7620 Miramar Road, Suite 4200
San Diego, California 92126

8.10    References to Time. All references to a time of day in this Agreement
are references to the time in the State of California.

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8.11    Amendment. This Agreement may not be amended except by an instrument in
writing signed on behalf of each of the parties.
8.12    Counterparts. This Agreement may be executed in several counterparts,
each of which is an original and all of which together constitute one and the
same instrument.
8.13    No Third-Party Rights. Nothing expressed or referred to in this
Agreement gives any Person other than the parties to this Agreement any legal or
equitable right, remedy, or claim under or with respect to this Agreement or any
provision of this Agreement, and this Agreement and all of its provisions are
for the sole and exclusive benefit of the parties to this Agreement and their
successors and permitted assigns. The undersigned are signing this Agreement on
the date stated in the introductory clause.
SMART KIDS, LLC

By:     /s/ Thomas Arndt            
Name: Thomas Arndt
Title: Managing Member

ATHENA BRANDS, INC.

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                    By:    /s/ V. Scott Vanis            
Name: V. Scott Vanis
Title: Chief Executive Officer
SCHEDULE A

ASSETS

Kids 50 Trademark (USPTO Registration No. 4,332,749)

Assignment of License Agreement between GabbaCaDabra, LLC and Smart Kids, LLC
for
Use of the “Yo Gabba Gabba” trademark

 

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Yo Gabbn Gabba
Standard Terms and Conditions
WHEREAS GabbaCaDabra LLC of 15000 Ventura Blvd} 3 rd Floor, Sherman oaks, CA
"403 ("Licensor") and
SaddleSprings Beverage Company, Inc. ("SaddÆeSprings") entered into an agreement
dated November 21, 201 1 (the "Deal Memo"), the parties hereby agree as foiiows:
A.
All of the rights and obligations of SaddleSprings under the Deal Memo are
hereby assigned to Smar{KIDS, LLC of 1990 S Bundy Drive, Suite 390, Los Angeles,
CA 90025 ("Licensee"),

B.
These Standard Terms and Conditions ("Standard Terms") shall be incorporated by
reference into the Deal

Memo. The Deal Memo and Standard Tenns shall collectively be referred to as the
"Agreement."
1.GRANT OF LICENSE: Subject to the terms and conditions of this Agreement,
Licensor grants to Licensee throughout the Territory (defined herein) for (he
Term (hereinafter defined ), the exclusive Fight and license to use the
trademarks, copyrights, characters, designs, and likenesses described in the
Deal Memo as the "Property"), solely in connection with the manufacture,
distribution, promotion, advefiisement and sale of the article(s) described in
the Deal Memo as "Product Categories" (herein caned the "Licensed Product(s)").
Except us provided herein, Licensor shall not permit any party other than
Licensee to use the Property in the manufacture, distribution, promotion,
advertisement and sale of or otherwise merchandise the Licensed Products in the
Territory. This Agreement does not constitute and may not be used so as to imply
the endorsement of the Licensed Products by Licensor. Nothing herein Shali be
construed so as to prevent Licensor from either granting any other licenses for
the Property (including without limitation, licenses for beverages without juice
content or juice flavoring) or from itself using the Property in any manner
whatsoever.
2.TERRffORY: Licensee shall be entitled to use the license granted hereunder
only in the territory described in the Deal Memo (called the "Territory").
3.LICENSE PERIOD:
(a)Effective Date, The license granted hereunder shall be effective as of the
date that the Licensed Products are first commercialized, as specified in the
Deal Melno (the "Effective Date").
(b)Initial Term. The initial term of this Agreement shall be for a period of
sixty three months from the Effective Date, unless terminated earlier as
provided hereunder, (the "Initial Term").
(c)Renewal Terms. This Agreement may be renewed under the following conditions:
(i)First Renewal Term. Provided the aggregate amount of $175,000 in royalties
have been earned under paragraph 4(a), for the twelve month period from the
forty ninth month through the sixtieth month of the Initial Term ("Initiak Term
Minimum Royalties"), this Agreement shall automatically renew for a period of
thirty nine months (the
"First Renewal Term"). In the event that royalties eamed during such twelve
month period are tess than the initial Term Minimum Royalties, but greater than
$87,500 and Licensee pays to Licensor an amount equal to the difference between
the
Initial Term Minimum Royalties and the actual amount calculated as eamed during
such twelve month period, this
Agreement shall be renewed for a period of thirty three months, provided
however, that the amount of such difference shall be paid to Licensor in fuH
prior to the end of the Initial Term,
(ii)Second Renewal Term. Provided the aggregate amount of $225,000 in royalties
have been earned under paragraph 4(a) for the twelve month period from the
twenty fifth month through the thirty sixth month of the First Renewal Term
("First Term Minimum Royalties"), this Agreement shall automatically renew for a
period of thirty nine months (the "Second Renewal Term"). In the event that
royalties earned during such twelve month period are less than the First Term
Minimum Royalties, but greater Chan $168,750 and Licensee pays to Licensor an
amount equal to the difference between the First Term Minimum Royalties and the
actual amount calculated as eamed during such twelve month period, this
Agreement shall be renewed for a period of thirty three months, provided
however, that the amount of such difference shall be paid to Licensor in full
prior to the end of the First Renewal Term.
(iii)Third and Subsequent Renewal Terms. In the third and subsequent renewal
terms, this Agreement shall be automaticalky renewed for further period of
thirty nine months, provided that royalties in an amount equal to 1     of the
previous renewal term have been earned during the twelve month period from the
twenty fiflh month through the thirty sixth month of such previous renewal term
("Minimum Royalties"). To illustrate, Minimum Royalties in the third renewal
term must equal $220,000 ($200,000 times 1 10%) in order for automatic renewal
to take place. In the fourth renewal term, Minimum Royalties must equal
$242,000, or $220,000 times 110%,
In the event that royalties earned during such twelve month period are less than
the Minimum Royalties, but at least 75% of (he Minimum Royalties and Licensee
pays to Licensor an amount equal to the difference between the Minimum Royalties
and the actual amount calculated as earned during such twelve month period, this
Agreement shall be renewed for a further period of thirty three months, provided
however, that *he amount of such difference shall be paid to Licensor in full
prior to the end of the previous renewal term.
(d)    "Term" shall mean the Initial Term and any renewal terms as provided
hereof.

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PAYMENT:

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Royalty Rate. Licensee shall pay to Licensor a royalty equal to 3% of Net Sales
(as defined herein) frotn the commencement of commercial production for a period
of eighteen months; and thereafter at the rate of 5% of Net Sales through the
date of termination of the Agreement. The tenn "Net Sales" shall mean the gross
amount of sales of Licensed Product at the invoiced selling price, net of only:
(i)
reasonable and customary quantity discounts;

(ii)
reasonable and customary discounts for early payments;

(iii)
sales to Licensor, its affiliates, agents and representatives; and

(iv)
actual Rturns for credit not to exceed two percent (2%) of sales in any
quarterly reporting period.

No deduction shall be made by Licensee for uncollectible accounts, markdowns,
vendor chargebacks or other discounts not expressly set forth in Paragraph
4(a)(i) above, or for costs incurcd in manufacturing, selling, distributing,
advertising Licensee's taxes, if any, including, but not limitcd to, sales,
inventory, income, value-added and use taxes on sales of Licensed Products or
Royalties, shall bo payable by Licensee and shall not be deducted from
Royalties.
If any Licensed Products are shipped to Licensee's customers on an FOB basis
(i.e. where the eustomer incurs all freight and duty charges after the goods are
delivered to the originating port of shipment), the royalty payable by Licensee
on its sales of such Licensed Products will be based on a rate that is two
percent (2%) higher than the royalty rate set forth in the Deal Memo with
respect to such Licensed Products.
(a)Periodic Statements. Within twenty (20) days after the end of the calendar
quarter in which the initial shipment of Licensed Products is made, and
thereafter within twenty (20) days after the end of each calendar quarter,
Licensee Shau furnish to Licensor (in a form to be supplied by Licensor, or in
tlie absence thereof, in a form acceptable to Licensor) complete and accurate
statements certified to be accurate by Licensee showing the number, description,
gross sales price, itemized deductions from gross sales price, and the Net Sales
of each Licensed Product sold by Licensee and any returns made during the
period* together with a computation of the royalties due. Licensee shall provide
such statements to Licensor whether or not any of the Licensed Products have
been sold during said period commencing with the calendar quarter in which the
initial Licensed Products shipment occurs. AIE information shall be shown
separately, where applicable, for each country within the Territory. Licensee
agrees that royalty reports will indicate clearly (by name or character or
similar description) the Licensed Products sold and will be given in sumcient
detail to enable Licensor to royalties by Licensed Products. It is understood
that timely rendering of all statements required hereunder is essential under
the terms of this Agreement.
(b)Royalty Payments. Licensee shall remit the royalties due for each caEendar
quarter within twenty (20) days aner the end of each calendar quarter, and
payment shall be made with the statement rendered for that quarter. The receipt
or acceptance by Licensor of any of the statements hereunder, or any royatties
paid hereunder, or the cashing of any royalty check paid hereunder, shall not
preclude Licensor from questioning the correctness thereof at any time. In the
event that any inconsistencies or mistakes are discovered in such statements or
payments, they shall immediately be rectified by Licensee and Licensee shall
make appropriate payment to the Licensor within fifteen (15) days of such
discovery.
(c)Records and Audits. At its principal place of business, Licensee shall keep
and maintain accurate records of the transactions underlying the statements to
be furnished hereunder. Licensee shall allow representatives of Licensor during
office hours, upon reasonable notice and at reasonable intervals (not to exceed
two times per calendar year), to audit and make copies of such records for the
purpose of ascertaining the correctness of such statements. If any such audit
shall disclose any deficiency of five percent (5%) or more, Licensee shall pay,
in addition to such deficiency, the actual and reasonable cost Of such audit*
Upon demand of Licensor, not to exceed two times per calendar year, Licensee
shall at its own expense furnish to Licensor a detailed statement signed and
verified by Licensee's chief financial officer showing the number, description,
gross sales price, itemized deductions from gross price and Net Sales of the
Licensed Products covered by this Agreement distributed and/or sold by Licensee
(and any of its affiliated, associated, or subsidiary companies) up to the date
of Licensors demand. Ail books of account and records shall be kept available
for at least three (3) years after the tennination or expiration of this
Agreement and the last renewak thereof.
(d)Payments. All payments of royalties hereunder including advance payments and
minimum guarantees, shall be made in U.S. Dollars to the order of Licensor or
any other person designated in writing by Licensor. In the event Licensee fails
to make any payment due hereunder in a timely manner, any such late payment
shall bear interest at the prime rate plus 2% of the Licensor's bank calculated
from the date such payment was originally due until the date such payment is
received by Licensor or by any other party designated by Licensor in writing.

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LICENSED PRODUCTS, QUALITY AND APPROVALS:
(a)General Quality. Licensee agrees that the Licensed Products shall;
(i)be of high standard and of such style, appearance and quality so as to
protect and enhance the Property and the good wilt pertaining thereto;
(ii)meet Licensor's artistic quahty standards and specifications; and
(iii)be manufactured, soid, distributed, advertised, and promoged in accordance
with all applicable U.S. and foreign federal, state and local laws, regulations,
and ordinances.

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(b)Preapproval of Licensed Products & Related Materials. Before distributing,
selling, advertising, or promoting each of the Licensed Products, Licensee shall
deliver to Licensor, for each of the Licensed Products free of for Licensor's
written approval, the following in the order listed:
(i)sketches;
(ii)finished artwork and final proofs;
(iii)pre-production samples or strike-offs; and
(iv)all other finished cartons, containers, packing and wrapping material, and
similar materials upon which the Property appears (collectively the "Related
Materials").
At the time of initial shipment of each of the Licensed Products, Licensee shall
deliver to Licensor the number of post-production samples of each such Licensed
Product set fort!) in the Deal Memo.
(c)PackagingJComponents, Licensor shall have the right to approve how each of
the Licensed Products is packaged, and shall have the right to approve which
Licensed Products and other products may be packaged fogether; such approval
shall not be unreasonably dekyed.
(d)Additional Samples. In addition to the samples provided to Licensor pursuant
to Paragraph 5(b), Licensor may request, from time to time, up to twelve (12)
samples per year, individual random samples of each Licensed Product and the
Related Materials. Samples for evaluation purposes shall be provided at no cost
to Licensor, FOB Licensee's plant, in aggregate quantities not to exceed 500
individual packages per SKU.

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Notices. Licensee shall cause to appear on or within each Licensed Product and
all Related Materials any notice specified by Liconsot.
(0 Advertising, PromotionRl and Display Materials. Before finalizing, using or
distributing any advertising, promotional, display or other shni!ar materials
bearing the Property, Licensee shall deliver same to Licensor for its prior
written approval.
(a)Licensor's Representatives, Licensor will designate representatives to be
responsible for timely responses to
Licensee's requests,

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Quality Control. Licensee hereby acknowledges that Licensor is not competent to
determine whether the Licensed Products are safe for the sale to the public at
large or in compliance with any and all laws applicable in the Territory, and
any approval given to the Licensed Products by or on behalf of Licensor shall in
no way detract from or limit Licensee's obligations pursuant to Paragraph 10.
(b)Marketing Ethics. Licensee acknowledges that Liccnsor has a significant
interest in ensuring that the Licensed Products are manufactured, sold,
distributed and promoted in accordance with the highest ethical and business
standards. Therefore, Licensee, for its own account and on behalf of affiliates
and third party manufacturers, if any, confirms that it will strictly comply
with the following standards and requirements in exercising any rights hereunder
with respect to the manufacture, sale, distribution and promotion of the
Licensed Products*
1

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Comply with national laws of any country in which Licensed Products, or any
components thereof, are manufactured, and comply with any local laws,
regulations. or standards applicable to such manufacturing, and any industry
standards which have been established in said location (hereinafter,
collectively, "Local Manufacturing Laws and Standards").

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Not employ children in the Inanufacture, assembly, packaging, or conversion of
Licensed Products, or any components thereof, either directly or indirectly,
unless such employment is in accordance with Local Manufacturing Laws and
Standards with respect to child labor.
(iii) Not use forced or prison labor in the Inanufacture, assembly, packaging,
or conversion of Licensed Products, or any convonents thereof, either directly
or indirectly.

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Ensure that all persons employed in the Inanufacture, assembly, packaging, or
conversion of Licensed Products, or any components thereof, either directly or
indirectly, have a healthy and safe working environment.
(v) Make best efforts to ensure that fho manufacture, assembiy, packaging, or
convcrsi0i1 of Licensed Products, or any components thereof, either directly or
indirectly, is done in such a way as to minimize waste, recycle raw materials,
properly and safely dispose of any toxic materials, and otherwise maintain sound
environmental programs and practices,

--------------------------------------------------------------------------------

Exclusivity. Licensee shall not license, in connection with the "Kids 50" brandi
any other preschooi or kid targeted brand during the Term or any extension
thereof.

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6.    ARTWORK AND OWNERSHIP OP PROPERTY:
(a)Artwork. Licensor shall provide to Licensee, free of charge, access to the
oniine style guide that Licensor generalEy makes available to its merchandise
licensees, All artwork and related material on the online style guide as well as
any original artwork and designs created by Licensee or under Licensee's
authority and involving the Properly, (notwithstanding their invention,
creation, or use by Licensee)} shall be and remain the property of Licensor; and
Licensor shall be entitled to use the same and to license the use of same by
others without restriction, Any new art, literary or musical work involving the
Property created by Licensee or a third party on behalf of Licensee shall be
subject to Licensor's written approval, and shall be created at Licensee's
expense. If Licensee creates or engages a third party to create any such art,
literary or musical work in connection with the Property, then Licensee shall
obtain a agreement with the third party that any copyrights, tradelnarks,
setvice marks, design rights or other similar rights of ownership arising from
such work shall be the sole property of Licensor, and Licensee shall, at
Licensee's expense, do all things necessary to ensure that such rights ftllly
and irrevocably vest in Licensor. Such written agreement and/or assignment from
Licensee or a third party shall be provided by Licensee to Licensor upon
request. Licensee agrees that any such artwork and Related Materials shall be
considered "work made fot hire" as that term is defined in The Copyright Act of
1976, as a work created as a contribution to a collective work, a supplementary
work, a compilation, or otherwise; provided, however, that if and to the extent
any such artwork and Related Materials shall not be considered "work for hire",
Licensee hereby assigns any and ell of its right, title, and interest in such
artwork and Related Materials to Licensor and shall take all steps reasonably
necessary to assist Licensor to effectuate such assignment.
(b)Ownership of Property.
(i)Licensee recognizes all of Licensors rights and interests in and to the
Property, and that all use of the Property licensed hereunder inures to the
benefit of Licensor or its grantor(s). Licensee shall not take any action which
may harm or adversely affect Licensor's rights or goodwill in the Property,
including without limitation using or registering a name or mark which is
identical to or confusingly similar to any name or mark included in the
Property, and, further, Licensee shall not during the Term or 8t any time after
expiration or termination of this Agreement, challenge the validity of
Licensor's ownership of the Property. Licensee's use of any other marks
("Ancillary Marks") shall be used at Licensee's own risk, and Licensee shall
take any and all precautions deemed appropriate to ensure that any use by
Licensee of Ancillary Marks does not constitute an infringement of another's
rights. Licensee shall fully indemnify Licensor against any claim, suit, loss or
damages, including reasonable fees, arising out of use of Ancillary Marks.
(ii)No right, title, or interest, in and to the property except the license
interest granted by Paragraph I hereof, is transferred by this Agreement.
Licensee hereby assigns, transfers and conveys to Licensor or its grantor(s) all
trademarks, service marks, trade dress, copyrights, equities, good will, titles
or other rights in and to the Property which may have been obtained by Licensee
or which may have vested in Licensee as a result of its activities under this
Agreement, and Licensee will, at Licensor's expense in connection with the
preparation thereof, execute any instruments reasonably requested by Licensor to
confirm the foregoing, including the documents referenced in Paragraph 9 of this
Agreement. No consideration other than the mutual covenants and consideration of
this Agreement shall be necessary for any such assignment, transfer or
conveyance,
(iii)Licensor shall acquiæ no right, title or interest in or to any trademarks,
service marks, trade dress and/or

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copyrights owned by Licenscc and used by Licensee in connection with the
Licensed Products as set forth in Exhibit B hereto ("Licensee VIP"), which
rights to such Licensee IP shall be and remain those of Licensee in connection
with the Licensed Products as set forth in Exhibit B hereto ("Licensee IP"),
which rights to such Licensee iP shall be and remain those of Licensee,

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DISTRIBUTION:
(a)Channels of Distribution. Licensee shall diligently and continuously
manufacture, sell, distribute, advertise, and promote the Licensed Products
during the Term, and shall make and maintain adequate arrangements for the
distribution of the Licensed Products solely the Channels of Distribution,
Licensee shall offer the Licensed Products for sale in substantia} quantities by
the marketing date specified in the Deat Memo, if any, with delivery within a
reasonable time thereafter, including at least one of the Licensed Products in
each of the categories listed in the Deai Memo.
(b)Sale/Distribution. With regard to the sale and distribution of the Licensed
Products covered by this Agreement, Licensee agrees as follows:
(i)Licensee shall sell and distribute the Licensed Products outright and not on
an approval, consignlnent, or guaranteed sale or return basis;
(ii)except with the prior written consent of Licensor, Licensee shall not
directly or indirectly sell or distribute the Licensed Products for Promotional
Purposes (defined below).
(iii)except with the prior written consent of Licensor, Licensee will not use,
or knowingly permit the use of, the Licensed Product as a Premium (defined
herein). The term "Premium" includes, but is not limited to, free or
self-liquidating items offered to the public in conjunction with the sale or
promotion of a product or service, including tramc building or continuity visits
by tho consumcr/customer, or any similar scheme or device, the prime intent of
which is to use the Licensed Product(s) in such a way as to promote, publicize
and/or sell the products, services, or business image of the third party company
or manufacturer. "Premium" also includes distribution of the Licensed Products
for retail sale through distribution channels offering earned discounts or
*'bonus" points based upon the extent of usage of the offeres product or
service; and

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(iv)in tho event that any sale is made at a special price to any of Licensee's
subsidiaries or to any other person, finn or corporation related in any manner
to Licensee, or its officers, directors, or major stockholders* there shall be a
royalty paid on such sales bascd upon the price generally charged the trade by
Licensee.

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Promotional Uses, Licensee will be the sole and exclusive supplier of the
Licensed Products to Licensor for Promotional Purposes. "Promotional Purposes"
shall be defined to include any of the following, regardless of whether the
product(s) is given away free or a fee is charged to the end consumer:
promotions including on-pack promotions, in-pack promotions, instant win games,
tours or exhibitions; and any other premium or promotion; any giveaway; any
sweepstakes or contest; any mail order; any movie, video, or show, or
record-related promotion, prcmium, or publicity; or any other similar type of
publicity. Licensee shall not, without Licensor's prior written consent, sell
and distribute the Licensed Products to jobbers, wholesalers, distributors,
retail stores or merchants whose sales or distribution are or will be made for
publicity or promotional tiein purposes, combination sales, premiums, giveaways
or similar methods of merchandising. Licensee specifically acknowledges that
Licensor may exercise its rights contained in this Subparagraph (c) concurrently
with the rights exercised by Licensee under this Agreement. Licensor
specifically reserves all other rights with respect to the Licensed Products for
any and all other channels of trade and/or modes of distribution and delivery
including but not limited to, premiums, promotions, give-aways, direct
maiVdirect response, electronic/lnternet shopping, TV shopping,
mail-order/catak)g shopping, vending machines, amusement and theme parks and
merchandising thereof, live stage show and Inerchandising thereof, theatrical
motion pictures and merchandising thereof and fan clubs and merchandising
thereof.
Distributors/Channels of Distribution. Licensee shall advise all of its
distributors of the Channels of
Distribution set forth in this Paragraph and use its best efforts to ensure that
none of its distributors sell or offer for sale Licensed Products outside of
those Channels of Distribution. Licensee shall sell and distribute the Licensed
Products only to jobbers, wholesalers and distributors for sate and distribution
to retail stores and merchants onbt in the Territory, and directly to retail
stores and merchants for salo and distribution direct to the public only in the
Territory ('Channels of Distribution"). For the avoidance of doubt, Deep
Discount Stores (as defined herein) are expressly excluded from the authorized
Channels of Distribution. "Deep Discount Stores" shall mean stores that offer
for sale primarily discounted items that are typically surplus, liquidated, out
of season, discontinued, salvaged, part of an odd or partially damaged lot of
goods, etc. and include without limitation Odd Lot, Dohar Stores, Jacks $.99
Stores* etc, Deep Discount Stores do not include nationat mass retailers (e.g„
WalMart, Target, Kohl's, Best Buy, etc.), regional mass retailers (e.g., Caldor,
Ames, Bradlees, etc,) or warehouse clubs (e.g., Costco, Sam's Club, etc.), In
the event Licensor or Licensee obtains know}edge of any sale of Licensed
Products by a distributor outside of the Channels of Distribution, the
knowledgeable party shall immediately provide written notice to the other patty
of such unauthorized distribution. Licensee shall have a thirty (30) day cure
period aner the date of notice to stop the alleged unauthorized distribution or,
if not immediately stoppable, demonstrate to the sole satisfaction of Licensor
Licensee's on-going efforts to address the situation. Notwithstanding the
foregoing, Licensee may sell to Deep Discount Stores during the selE„off period
upon prior written consent of Licensor.
(e)    Suggested Retail Price. Licensee agrees to keep Licensor, at Licensor's
request, advised of the wholesale and suggested retail prices at which Licensee
sells the Licensed Products covered hereunderr
1.
LICENSOR$S LIMITED WARRANTY:

(a)Licensor represents and warrants that it holds all such rights and interest
in the Property, and has due authority, as required to pennit Licensor to enter
into this Agreement, Provided that Licensor shall be given prompt notice of any
such claim and fun authority to defend, settle or otherwise control such
litigation, and provided Licensee shall have used the Property solely in
accordance with the terms and conditions provided herein and cooperates fully
with Licensor in conducting the litigation. Licensor will defend at its own cost
and expense any action or claim of infringement arising out of or related to the
use of the Property in any manner authorized by this Agreement, or any action
brought against Licensee based on any claim that Licensor is not possessed of
such right, title and interest in the Property as to be entitled to grant this
license, and will indemnify and hold Licensee and its officers and directors
harmless against any such claim. If at any time, any of the representations and
warranties made by Licensor in this Agreement proves to be inaccurate* Licensor
shall immediately notify Licensee in writing and hold Licensee harmless from any
consequences thereof, provided required approvals have been granted,
(b)LIMETATION ON WARRANTY. ASIDE FROM THE WARRANTIES NOTED ABOVE, LICENSOR
DISCLAIMS ANY EXPRESS OR IMPLYED WARRANTY, INCLUDING WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, WITH RESPECT TO THE
PROPERTY. EXCEPT FOR ANY LIABILITY OF LICENSOR PURSUANT TO PARAGRAPH 86), IN NO
EVENT SHALL LICENSOR BE LIABLE FOR ANY MATI'ER WHATSOEVER RELATING TO (l) THE
USE BY LICENSEE OF THE PROPERTY, OR (2) THE MANUFACTURING} MARKETING,
ADVERTISING, DISTRIBUTION, SALE AND/OR PROVISiON BY LICENSEE OF ANY PRODUCTS
AND/OR SERVICES UNDER OR IN CONNECTION WITH THE PROPERTY.
2.
PROTECTION OF LICENSOR(S RIGHTS:

(a)Infringements by Third Parties. Licensee Shali promptly notify Licensor in
writing of any infringements or imitations of the Properly on Licensed Products
similar to those covered by this Agreement which may come to Licensee's
attention. Licensor or its grantor shall have the sole tight to commence and/or
defend a legal action or negotiate a settlement relating to any alleged
infringement of or by the Property. Licensee shall not institute any suit or
take any actions on account of any such infringements or imitations without
first obtaining the written consent of the Licensor. Licensee shall use its best
efforts to give Licensor al} reasonable assistance and co-operation in any such
legal action including, but without limitation, executing reasonably necessary
documents and giving reasonably necessary testimony to permit Licensor, in its
own name and/or on behalf of Licensee or jointly, to commence or defend the
legal action. If Licensor wishes to commence litigation iti the name of Licensee
or name Licensee as a party to such suit, Licensor shah obtain Licensee's prior
written approval, such approval not to be unreasonably withheld. Any out of
pocket costs incurred by Licensee in rendering such assistance requested by
Licensor shaH be paid for or reimbursed by Licensor, Licensor shah be entitled
to any recovery or damages collected as a result of such

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legal action or negotiated settlement. No settlement by Licensor shall impose a
monetauy liability on Licensee without Licensee's consent to such settlement.
(b)Alleged Infringements by Licensor. "Fith respect to any claim or suit that
Licensor is not possessed of such right, title, and interest in the Property as
to be entitled to grant this license to Licensee, Licensor shall have the option
to undertake and conduct the defense of any suit so brought and no settlcment of
any such claim or suit shall be made without the prior written consent of
Licensor, Licensee agrees to cooperate fully with Licensor in any such action,
Any out of pocket costs incurred by Licensee in rendering such assistance
requested by Licensor shall be paid for or reimbursed by Licensor.
(c)Copyright Documents. At Licensor's solc cost and expense, Licensee agrees to
assist Licensor with protecting Licensor's Property.
3.
LICENSEE WARRANTY AND INDEMNITY:

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Licensee Warranty. Licensee expressiy warrants that:

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Organization and Good Standing. Licensee is a duly organized corporation,
validly existing, and in good standing under the laws of its jurisdiction of
charter, having ail requisite power and authority to own its assets and carry on
its business as presently conducted. Licensee is not required to be qualified or
otherwise authorized to do business as a foreign corporation in any jurisdiction
within or without the USA in which failure to qualify would have a material
effect upon this Agreement.

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Authorization; Validity. The execution, delivery, and perfonnance of this
Agreement by Licensee
has been duly and validly authorized. This Agreement has been duly and validly
executed and delivered by Licensee, and is the legal, valid, and binding
obligation of Licensee, enforceable in accordance with its terms, except as
limited by bankruptcy, insolvency, moratorium, reorganization, and other laws of
general application affecting the enforcement of creditors' rights and by the
availability of equitable remedies.
(iii) Consents, etc. No approval* consent, waiver, or authorization of, or
filing or registration with, any governmental authority or third party is
required by Licensee for the execution, delivery, or performance of this
Agreement or the transactions contemplated hereby.

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Licenses; Compliance. Alt authorizations, consents, approvals, licenses,
franchises, and permits required by any govemmental authority under applicable
law or regulation or granted by any third party for the ownership or operation
of the assets owned or operated by Licensee or for the conduct of its business
as presently conducted ("Permits") are in full force and effect* and Licensee is
in compiiance With (x) the terms of all Of the Permits; (y) all laws* statutes.
and regulations affecting Licensee and its business and assets; and (z) all
judgments, orders, rulings, or other decisions of any governmental authority,
court, or arbitrator having jurisdiction over Licensee.
(i)Violations. The execution, delivery, and performance of this Agreement do not
and will not (w) with or without the giving of notice or tho passage of time, or
both, constitute a default, result in a breach of, result in the tennination of,
result in the acceleration of perfonnance of, require any consent, approval or
waiver (other than those identified herein), or result in the imposition of any
lien or other encumbrance upon any property or assets of Licensee under any
agreement, lease, or other instrument to which Licensee is a party or by which
any of the property or assets of Licensee is bound; (x) violate any Permit
described in the preceding subsection; (y) violate any law, statute, or
regulation or any judgment, order, ruling, or other decision of any governmental
authority, court, or arbitrator; or (z) violate any provision of Licensee's
agreements between or among its owners.
(ii)Acts or Omissions. Licensee and its affiliates, shall assume fill
responsibility for all acts, omissions and misrepresentations by Licensee
arising out of or relating to (x) any and all uses of the Property, (subject to
any Licensor liability pursuant to Paragraph 8(a) above); and (y) the
manufacture, distribution, sale and advertisement of the Licensed Products.
(a)Licensee Indemnity. Licensee shall indemnify Licensor and shall defend
Licensor against, and hold Licensor hannless from, all claims, liabilities,
suits, losses, damages, injury, death, and expenses (including reasonable
attomeys' fees) brought by a third party against Licensor arising out of or
relating to any breach or alleged breach by Licensee of any of its duties,
obligations, representations and warnnties set forth herein, including, without
limitation, claims based on:
(i)any alleged or actual unauthorized use of any intellectual property right
(including, but without limitation, any copyright, patent* trademark, or other
intellectual property right) by Licensee in connection with the Licensed
Products (except for claims that the Property infringes any patent, or
trademark); or
(ii)any alleged or actuat defect in the Licensed Products (including, but
without limitation, any claim of product liability); or
(iii)any alleged or actual act or omission by Licensee or Licensee's agents or
employees (whether wrongful, negligent, or otherwise) in connection with the
Licensed Products or this Agreement.
(b)Defense. Upon notice from Licensor, Licensee shall undertake the defense of
any such claim or suit. In such event, Licensor shall have the right
(i)to approve the attomey selected by Licensee, such approval not to be
unreasonably withheld;
(ii)to bo kept informed at all tinmes about such claim or suit; and
(iii)to approve any settlement offer or agreeinent (other than one solely for
money dainages where Licensee pays the full amount of such settlement), such
approval not to be unreasonably withheld.

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Licensor shall have the right to retain its own counsel in connection with any
claim or suit brought or made as set forth hereinabove, provided that Licensor
shall pay ifs own legal expenses in connection therewith.
As used in this Paragraph 10 only, 'Licensor" shan also include the grantor(s),
officers, directors, employees and agents of Licensor and its affiliates and the
officers, directors and employees of any other indemnitees. This indemnity shall
survive the tennination or expiration of this Agreement.
11,    LIMITATION OF LIABILITY: IN NO EVENT SHALL A PARTY BE LIABLE TO THE OTHER
PARTY FOR
8
12
8

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ANY SPECIAL, CONSEQUENTIAL, INCIDENTAL OR DAMAGES OF ANY KIND (INCLUDING,
WITHOUT LIMITATION, LOSS OF PROFITS, OR BENEFITS OF USE OR LOSS OF BUSINESS)
WHETHER OR NOT SUCH PARTY WAS ADVISED OF THE POSSIBILITY OF SUCH Loss, HOWEVER
CAUSED, WHETHER FOR BREACH OR
REPUDIATION OF CONTRACT, BREACH OF WARRANTY OR NEGLEGENCE. ANY LIABELITY OF
L{CENSOR FOR ANY AND ALL CAUSES OF ACTION WITH RESPECT TO THIS AGREEMENT AND THE
RIGHTS GRANTED HEREN SHALL BE LIMITED TO THE AMOUNT OF ROYALTIES PAID BY
LICENSEE TO LICENSOR HEREUNDER.
1.
DEFAULT AND TERMINATION;

(a)Bankruptcy. This Agreement may be terminated by Licensor, in its sole
discretion to the fuklest extent permitted by law at the lime Of the occurrence,
if:
(i)a petition in bankruptcy is filed by or against Licensee, or if Licensee
becomes insolvent* or makes an assignment for the benefit of its creditors or an
amngement pursuant to any bankruptcy law; or
(ii)Licensee discontinues its business or if a receiver is appointed for it or
its business.
(b)Licensee Infringement. This Agreement may be tenninated by Licensor, in its
sole discretion, if Licensee becomes subject to or otherwise involved in any
claim or lawsuit of the kind set forth in Paragraph 10 herein, which in the sole
judgment of Licensor materially interferes with Licensee's ability to perform
its duties and obligations hereunder or harms the reputation of Licensor or the
Property.
(c)Unnpproyed Merchandisewnøpproved Distribution. In the event that Licensee
ships or sells any Licensed Product that has not been fully approved in writing
by Licensor (including written approval of Licensor for the Related Materials)
or in the event that Licensee sells, or, subject to the thirty (30) day cure
period provided in Paragraph 7(d), any disttibutor of Licensee sells, Licensed
Products outside of the Channels of Distribution or the Territory as the case
may be, Licensor shall have the right to terminate this Agreement immediately by
delivering a written notice to Licensee. In addition to Licensor's rights and
remedies at law or in equity or pursuant to this Agreement which rights and
remedies shall be deemed to be cumulative and in addition to the rights and
remedies set forth herein, Licensee agrees to pay Licensor as liquidated damages
and not as penalty a royalty of twenty five (25%) of Net Sales of all such
unapproved Licensed Products that have been sold or on any Licensed Products
sold outside the Channels of Distribution or the Territory as the case may be.
Licensee further agrees to pay Licensor for the cost of an audit to determine
the quantity of unapproved Licensed Products sold by Licensee ot Licensed
Products sold outside the Channels of Distribution or the Territory as the case
may bet Licensee shall also immediately cease and desist from selling such
unapproved Licensed Products and shall Itcall all such unapproved Licensed
Products from wholesalers and retailers. Licensee shall also immediately recall
any Licensed Products sold in any unauthorized channels of distribution or
un)icensed territory as the case may be from such unauthorized distributors or
retailers.
(d)Assignment Without Consent. This Agreement may be terminated by Licensor in
its sole discretion, immediately upon written notice if Licensee voluntarily or
involuntarily breaches Paragraph 19 of this Agreement.
(e)Failure to Distribute. Licensor shall have the right to terminate this
Agreement as provided in and in accordance with Paragraph 7 in the event
Licensee rails to distribute the Licensed Products as required by Paragraph 7.
(f)Other Breach. In addition to the other events of default and termination set
forth herein, this Agreement may be terminated by a party if the other party
breaches any other covenant in a material manner, or fails go perform any of its
obligations under the tenns of this Agreement and fails to remedy such breach
within thirty (30) days of receipt of writtcn notice Of breach from the
non„breaching party (or if such breach is not capable of being cured within such
30 day period despite continuing diligent efforts on the part of the breaching
party, such breach has not been cured within 45 days after written notice of
such breach); provided however, that with regard to any failure or breach
relating to Licensee's obligations with respect to copyright, trademark or
service mark notices, product recall, monetary payments or royalty statements,
Licensee's cure period shall be thirty (30) days from Licensee's receipt of
Licensor's written notice Of breach.
2.
EFFECT OF TERMINATION:

(a)Termination of mght to Sell. the event this Agreement is tenninated as
provided above in Paragraph 12, Licensee, its receivers, representatives,
trustees, agents, administrators, successors, and/or assigns shall have no right
to sell* expioit, or in any way dcal with or in any Licensed Products or any
Related Materiai. Termination of the license under the provisions of this
Agreement shall be without prejudice to any rights which Licensor may otherwise
have against Licensee.

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Royalties and Minimum Guarantee Due on Terminatton. Upon termination of this
Agreement, ail royalties on sales theretofore made shaft become immediately due
and payable; no advances against royalties shall be repayable; and the balance
of any minimum royalty shall be immediately due and payable.

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(a)Attorneys' Fees. In the event that litigation of any nature with respect to
the performance, non-perfonnance or breach by Licensee of its duties and
obligations hereunder is initiated, then and in such event, the non-prevailing
party shall promptly reimburse the prevailing party's for the prevailing party's
costs and expenses, including reasonable attorneys' fees, incurred in connection
with said litigation.
(b)Reversion of Rights. Upon or aner the expiration or tennination of this
Agreement, all Tights granted to Licensee hereunder shall forthwith revert to
Licensor, and Licensee shall refrain from further use of the Property or any
further reference to it* direct or indirect* or anything deemed by Licensor to
be similar to the Property in connection with the manufacture, sale,
distribution, or promotion of Licensee's products, except as provided in
Paragraph 15 and Licensee shall deliver to Licensor all Related Materials and
advertising or promotional materials related to the Property.

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(c)Post-Term Obligations. Licensee shall ensure that upon expiration or
termination of this Agreement, all artwork, molds, casts, dies, etc. used by or
on behalf of Licensee in connection with the manufacture, sale and distribution
of the Licensed Products granted herein shall be destroyed or returned to
Licensor, in Licensor's sole discretion, and Licensee shall furnish Licensor
with sworn affidavits of destruction if Licensor so directs. Additional}y, upon
expiration of any applicable Selloff Period, Licensee shall, at Licensor's
option, but at its own expense, destroy all remaining stock or inventory of
Licensed Products not purchased by Licensor pursuant to Paragraph 15(c) below
and shall furnish Licensor with an additional sworn affidavit of such
destruction if Licensor so directs, or, alternatively, if Licensor so elects,
Licensee shall deliver ait remaining Licensed Products to Licensor at no cost
for the Licensed Products, but at Licensor's expense for shipping.
14 e FINAL STATEMENT UPON TERMINATION OR EXPIRATION: Sixty (60) days before the
expiration of this Agreement and, in the event of its tennination, ten (10) days
aner rcccipt of notice of termination or the happening of the event w'hich
terminates this Agreement where no such notice is requited, a statement showing
the number and description of Licensed Products covered by this Agreement on
hand or in process shall be furnished by Licensee to Licensor. Licensor shall
have the right to take a physical inventory to ascertain or verify such
inventory and statement, and refusal by Licensee to submit to such physicai
inventory by Licensor shall forfeit LicenseeTs right to dispose of such
inventory, Licensor retaining all other legal and equitable rights Licensor may
have in the circumstances,
15.    DISPOSAL OF STOCK UPON TERMINATION OR EXPIRATION:
(a) Sell-Off. After termination or expiration Of this Agreement, (unless such
termination by Licensor is due to a default or material breach of this Agreement
by Licensee). and provided that Licensee has fumished the notice and permitted
the inspection required in Paragraph 14 above, Licensee may dispose of approved
Licensed Products covered by this Agreement which arc on hand or in process at
the time notice of termination is received or upon the expiration date,(it being
agreed that Licensee may not produce quantities of additional Licensed Products
during the last three (3) calendar quarters that are in excess of the then
current demand for such Licensed Products) for the sell-off period on a
non-exclusivc basis, provided Licensee is not in breach or otherwise in default
under this Agreement. All applicable royalties shall bo paid on Licensed
Products sold during the sell-off period within twenty (20) days following the
expiration of the sell-off period. If this Agreement is tenninated by Licensor
due to a default or material breach by Licensee, Licensee shall not haye any
right to sell-off any Licensed Products.

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Faulty Copyright or Trademark Notices. Notwithstanding anything to the contrary
herein, if Licensor terminates this Agreement due to the failure of Licensee to
comply with Paragraph 5., Licensee shall not manufacture, sell, or dispose of
any Licensed Products covered by this Agreement after its expiration or its
termination.

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Inventory. Licensor may, at its sole discretion, purchase any or all of
Licensee's remaining inventory after the sefl-off period at a price equal to the
Licensee's wholesale cost minus 20%.
16, LICENSOR'S REMEDIES: Licensee acknowledges that its failure (except as
otherwise provided herein) to cease the manufacture, sale, distribution,
advertising, or promotion of the Licensed Products covered by this Agreement or
any class or category thereof at the termination or expiration of this Agreement
or any portion thereof may result in immediate und irreparable dalnage to
Licensor and to the rights of any subsequent Licensee acknowledges and admits
that there is no adequate remedy at law for such failure to cease manufacture,
sale, distribution, advertising, or promotion, and Licensee agrees that in the
event of such failure, Licensor shall be entitled to equitable relief by way of
temporary and permanent injunctions and such other and further relief as any
court of competent jurisdiction may deem just and propert
1.NOTICES: All notices and statements required under this Agreement shall be in
writing addressed to the parties at the addresses above, unless notification of
a change of address is given in writing. All notices shall be sent by:
(i)registcred mail, return receipt requested;
(ii)overnight courier (e.g. Express Mail, Fedefal Express); or (iii) telefax or
e-mail with a follow up copy by regular mail.
Ali statements of account may be sent by regular mail. The date of mailing shall
be deemed the date the notice or statement is recgivcd by a party.
2.RELATIONSHIP BETWEEN THE PARTIES: Neither party shall represent itself as the
agent or legal representative of the other party for any purpose whatsoever, and
neither party shall have the right to create or assume any obligation of any
kind, express or implied, for or on behalf of the other party in any way
whatsoever, This Agreement shall not create or bc deemed to create any agency,
partnership, or joint venture between the parties.

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3.NO ASSIGNMENT OR SUBLICENSE:
(a)No Assignment. This Agreement is personal to Licensee and may not be sold,
assigned* delegated, subkicensed or otherwise transferred or encumbered, in
whole or in part, including without limitation, by operation of law, without the
prior written consent of Licensor, which consent may be withheld by Licensor in
its sole discretion. For purposes of detonnining whether an assignment of this
Agreement by Licensee (but not by Licensor) has occurred under this Paragraph
19, a merger of Licensee into another business entity or a merger of another
business entity into Licensee; the sale or transfer of mote than fifty percent
(50%) of the stock of Licensec or substantially all of Licensee's assets, shall
be deemed an assignment requiring notice to, and the prior written consent of,
Licensor, which consent may be withheld by Licensor in its sole discretion. Any
attempted sale, assignment, delegation, sublicense or other transfer or in
violation of the preceding sentences shall be deemed null and void, and of no
effect, and in such event, notwithstanding anything in this Agreement to the
contrary, Licensor shall have the immediates unqualified right to terminate this
Agreement in addition to all other rights and remedies it may obtain due to
Licensee's breach.
(b)Licensor Assignment. This Agreement may be assigned by Licensor upon written
notice to Licensee but without any consent, provided, however, that any such
assignment shall not release the Licensor from its obligations to the Licensee
under this Agreement.
(c)Third Party Manufacturer. Nothing herein shall be deemed to prevent Licensee
from causing the Licensed Products to be Inanufactured by other parties, subject
to the terms and conditions of this Agreement. If any manufacturing of the
Licensed Products shall be conducted outside the Territory, in addition to any
other obligations under this Agreement, Licensee shall advise Licensor in
advance of the nmne, address and manufacturing location and any third party
contractors shall sign the "Manufacturer's Agreement" set forth in Exhibit A
annexed hereto.
(d)Successors and Assigns. Subject to the restrictions against assignment
provided above, this Agreement shall be binding upon and inure to the benefit of
the parties, their successors and assigns,
4.FORCE MAJEURE: The inability of Licensee to commence or complete its
obligations hereunder (other than payment of royalties) by the dates herein
required resulting from delays caused by strikes, picketing, insurrection, acts
of God, war, emergencies, shortages, or unavailability of materials, limitations
ilnposed by exchange control regulations or foreign investments regulations, or
other causes beyond Licensee's reasonable control, shall excuse performance
during the continuation thereof and extend the period for the perfonnance of the
obligations for the period equal to the period(s) of any such deiay(s).
Notwithstanding the foregoing, in the event performance by Licensee is suspended
for three (3) consecutive months in accordance with this Paragraph 20, then
Licensor may, by written notice to Licensee, elect to terminato this Agreement
without any liability for either Licensor or Licensee.
5.TIME: Time is of the essence with respect to the obligations set forth in this
Agrcement
6.ENTIRE AGREEMENT; This Agreement is intended by tho parties as a final and
complete expression of their agreement with respect to the subject matter
hereof, and supersedes any and all prior and contemporaneous agreements and
understandings relating to it.
7.MODIFICATION AND WAIVER: This Agreement may not be modified and none of its
terms may be waived. except in writing signed by both parties. The failure of
either party to enforce, or the delay by either party in enforcing, any of its
rights shall not be deemed a continuing waiver or a Inodification of (his
Agreement.
8.SEPARABILITY: If any pan of this Agreement shall be declared invalid or
unenforceable by a coun of competent jurisdiction, it shall not affect the
validity of the balance of this Agreement, provided, however, that if any
provision of this Agreement pertaining to the payment of monies to Licensor
shall be declared invalid or unenforceable, Licensor shall have the right, at
its sole option, to terminate this Agreement upon giving not less than ten (10)
days written notice to Licensee.
9.GOVERNING LAW/JURISDICTION: The parties agree that this Agreement shall be
governed by the laws of the State of Califomia, or where applicable* the laws of
the United States as interpreted by federal courts in the state of California,
as to all matters, without giving effect to the principles of conflicts of law.
Licensor and Licensee agree that any judicial proceeding brought against any of
the parties to this Agreement arising from this Agreement or any matter related
hereto may be brought in the State Courts situated in, or in the United States
District Court located in Los Angeles. Licensee, by execution of this Agreement,
hereby accepts for itself the non-exclusive jurisdiction of the aforesaid
courts.
10.COMPLIANCE WITH LAWS: Each party agrees that it will at all times compfy with
applicable laws and regulations. Without limiting the generality of the
foregoing, neither party will export, re-export, transfer Of mako available,
directly or indirectly, any regulated items or information to:
(a)anyone outside of the United States in violation of any export laws and
regulations of the United States or
(b)otherwise in violation of any laws and regulations of any count.ry or
organizations of nations within whose jurisdiction either patty may operate or
do business. Licensee shall seek and obtain at its sole expense any necessary
regulatory consents and approvals with respect to the Inanufacture or sale of
the Licensed Products from any country or organizations of nations outside of
the United States within whose jurisdiction Licensee may operate or do business.
11.COUNTERPARTS: Counterpart copies of this Agreement may be executed for the
convenience of the parties, and each counterpart shall be deemed to be an
original instrument.
12.PARAGRAPH HEADINGS: The headings of the Paragraphs are for convenience only
and in no way limit or affect
the provisions hereof.
Agreed to and accepted;
GabbaCaDabra, LLC

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Name

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Agreed to and accepted:
SmartKIDS, LLC

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EXHIBiT A
Manufacturer's Agreement
The Licensor:
The Licensee:
Contract No.:
GabbaCaDabta
Expiration Date:
The Licensed Products:
License agreement and this Manufacturer's Agreement (unless sooner terminated or
extended) will expire on:
The Property:

Name and address of Manufacturer:
Territory of Manufacture:
Territory of Shipment:
In order to induce Licensor to consent to the manufacture of the Licensed
Products by the undersigned fov the Licensee, the undersigned agrees Ghat
(unless otherwise authori7Æd by the Licensor, under a similar manufacturer's
agreement for another Licensee):
It wilt not manufacture the Licensed Products to the order of anyone but the
Licensee, will invoice only the Liccnsco and will not ship to anyone other than
the Licensee or Licensee's customers.
1)
It will not subcontract production of the Licensed Products or components which
contain the Property without the prior wgitten consent of the Licensor.

2)
rt will not without the prior wuitten consent of the Licensor manumcture
merchandise utilizing any of the eopyrighted material and/or trademarks owned by
the Licensor other than the Licensed Products.

3)
It will permit the authorized representative of the Licensor to inspect its
activities and premises, books of account and invoices relevant to the
manufacturc and supply of the Licensed Produces.

4)
It will not publish or cause the publication of pictures of the Licensed
Products in any publication or promotional material, nor advertise the fact that
it is pemitted to manufacture the Licensed Products,

5)
It will not take any action anticipated to harm or adversely affect Licensor's
rights or related goodwill in the Property, nor witl it challenge the validity
of or Licensor's ownership of the Property, either during the term of this
ManufaeEurer'* Agreement or thereafter.

6)
It will not use any name or mark, other Iban those included in the Property as
pennitted hereunder, which is identical to or confusingly similar to any name or
mark included in the Property in the manufacture, distribution, sata and/or
advertisement or atty goods or setyice,s,

7)
It wilt not register or use in any country any name or mark identicat to or
conmsingly similar to any name or mark included in the Property.

8)
Upon expiration or termination of the Agreement, or upon notification by the
Licensor, the underiigned manufncturer will immediately cease manufacturing the
Licensed Produce and deliver to the Licensor or its authorized representative
evidence that the Property has been removed from any molds, plates or other
devices used Eo produce the Licensed Products, or in the event removal is not
practical or effective, that such molds or plates haye been destroyed.

9)
Licensee acknowledges that Agene and Licensor have a significant interest in
ensuring that the Licensed Products are manufactured, sotd, distributed and
promoted in accordance with the highest ethical and business standards.
Therefore* Licensee, for its own account and on behalf of affiliates and third
party manufacturers, if any confirms that it will strictly comply witli the
following standards and requirements in exercising any rights hereunder with
respect to the manufacture, sale, distribution and promotion of the Licensed
Products.

(i) Comply with the national laws of any country in which the Licensed Products,
or any components thereof, are manufactured, and comply with any local laws,
regulations, or standards applicable to such manufacturing, and any indus!ry
seandards which have been eslablished in said location (hereinafter,
collectively, 'Local Manufacturing Laws and Standards").

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Not employ children in the manufhcture, assembly, packaging, or conversion of
Licensed or any components thereof, cither directly or indirectly, unless such
employment is in accordance with Local Manufacturing Laws and Standards with
respect to child labor.

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Not use forced OF prison labor in the manufacture, assemb}y, packaging, or
conversion of the Licensed Prodnels, or any components [hereof, either directly
or indirectly.

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Ensure that all persons employed in the manufacture, assembly, packaging, or
conversion of the Licensed Products, or any components thereof, either directly
or indirectly, have a healthy and safe working environment,
(v) Make best efforts to ensure that the manufacture, assembly, packaging, or
conversion of the Licensed Products, or any componenls thereof, either directly
or indirectly, is done in such a Way as to ininimizß waste, recycle raw
matecials, properly and safely dispose of any toxic materials, and otherwise
maintain sound environmental programs and practices.
Agreed to and accepted:
Agreed to and accepted:
Agreed to and
GabbaCaDabra
 
("Licensor*t)
("Licensee")
 
Name
Narne:
 
 
 

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,-ppcz

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Title    
EXHIBIT B
Licensee IP
SmartKIDS@
KIDS 50
Y Water
Y Bone Water
Y immune Water
Y Brain Water
Y Muscle Water

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ASSIGNMENT AND BILL OF SALE

KNOW ALL MEN BY THESE PRESENTS, that Smart Kids, LLC, a California limited
liability company, with its principal place of business at 150 Pico Boulevard,
Santa Monica, California 90405 (“Seller”), for and in consideration of the
purchase price provided for in that certain Asset Purchase Agreement, dated
March 28, 2016 (the “Purchase Agreement”) between Seller and Athena Brands,
Inc., a Nevada corporation with its principal place of business at 7620 Miramar
Road, Suite 4200, San Diego, California 92126 (“Buyer”), and other good and
valuable consideration in full payment for the assets hereinafter specified, the
receipt and sufficiency of which is hereby acknowledged, has granted, bargained,
sold and by these presents does grant, bargain, sell, convey and deliver to
Buyer, and its successors and assigns, the assets set forth below (collectively,
the “Assets”):

The property is described as follows:

All rights to Kids 50 and Yo Gabba, intellectual property, designs, logos,
trademarks, likenesses and marketing rights.

TO HAVE AND TO HOLD the said assets unto Buyer, its successors and assigns, to
and for its own use, forever.

1.     Seller warrants to Buyer, its successors and assigns, that at the time of
delivery of this Assignment and Bill of Sale to Buyer, Seller has good and valid
title to said assets and good and lawful right to grant, bargain, sell, convey
and deliver said assets as aforesaid and that the title to said assets are as of
the date of delivery of said assets to Buyer, free and clear of all claims,
liens, pledges, security interests and other encumbrances of any nature
whatsoever. Seller further warrants that upon delivery of this Assignment and
Bill of Sale to Buyer, Buyer shall have good and valid legal title to the assets
described in this Assignment and Bill of Sale, free and clear of all claims,
liens, pledges, security interests and other encumbrances of any nature
whatsoever.

2.     Buyer shall not assume, pay or discharge or in any respect be liable for
any liability, obligation, commitment or expense of Seller, including without
limitation, the following liabilities and obligations of Seller incident to, or
arising out of:

(a)    the negotiation and preparation of, or performance under the Agreement,
this Assignment and Bill of Sale, including, without limitation, costs incurred
in connection with the assignment and sale of the Assets;
(b)     any claims, actions, suits, proceedings, liabilities, fines, penalties,
deficiencies or judgments existing on the Closing Date or arising any time
thereafter as a result of or in connection with the conduct of the business of
Seller, including, without limitation, the ownership or use of the Assets by
Seller and Seller’s conduct of its business up to and including the Closing
Date; or
(c)     any tax liabilities of any nature whatsoever of Seller on account of the
Agreement or this Assignment and Bill of Sale or the operations of Seller up to
and including the Closing Date.
3.     Seller agrees to execute and deliver to Buyer such other docu-ments and
instruments of sale, conveyance, transfer and assignment, satisfac-tory in form
and substance to Buyer, as may be reasonably requested by Buyer in order to
effect Seller’s assignment of the Assets hereunder.

IN WITNESS WHEREOF, the parties hereto have caused these presents to be executed
as of the March 28, 2016.

SMART KIDS, LLC

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By:      /s/ Thomas Arndt            
Name: Thomas Arndt
Title:

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ATHENA BRANDS, INC.
   

By:    /s/ V. Scott Vanis            
Name: V. Scott Vanis
Title: President

.

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