Exhibit 10.1

 

LICENSE AGREEMENT

 

THIS AGREEMENT is made and effective as of January_, 2020 (“Effective Date”) by
and between LIFEGUARD LICENSING CORP. (“Licensor”), a corporation organized
under the laws of the State of Delaware with offices at 595 Madison Avenue,
Suite 1101, New York, New York I 0022 and Canbiola, Inc., a corporation
organized under the laws of the State of Florida with offices at 960 South
Broadway, Suite 120, Hicksville, New York 11801 (“Licensee”).

 

W I T N E S S E T H:

 

A. Licensor and its affiliates have established a high-standing and reputation
with the public for highest quality products.

 

B. The preservation of the reputation and prestige of Licensor, its affiliates,
and their trademarks is of paramount importance and Licensor must have and
retain the right to take such actions as are necessary to ensure that all
activities in connection with the design, development, manufacture, marketing,
promotion, distribution or sale of products uphold and conform to the reputation
and prestige of such trademarks as designations for highest quality products.

 

C. Licensee has significant experience and expertise in the manufacture,
marketing, distribution and/or sale of certain “Products” (as defined below),
and/or in the maintenance and buildup of brand value, and Licensor is entering
into this Agreement in order to obtain such experience and expertise for the
benefit of the “Brand” (as defined below); moreover, the parties acknowledge
that Licensee’s failure to perform certain of its material obligations under
this Agreement may result in damage to the value of Licensor’s “Brand” (as
defined below) and its good will, in the minds of the trade and the public
within the “Territory” (as defined below).

 

D. Licensee hereby desires to be granted the right hereunder to use the mark
“LIFEGUARD” (the “Licensed Mark”) throughout the territory set forth on Schedule
A attached hereto (the “Territory,” with countries within the Territory
sometimes referred to individually as a “Country” and/or collectively as
“Countries”) in connection with the manufacture, marketing, distribution and
sale of the products set forth on Schedule A attached hereto (“Products”).

 

E. The term “Brand” as used herein means the “LIFEGUARD” brand.

 

NOW, THEREFORE, in consideration of the promises and agreements set forth
herein, the parties, each intending to be legally bound hereby, do promise and
agree as follows.

 

1. License Grant.

 

1.1 Licensor hereby grants to Licensee a non-exclusive (or an exclusive as
otherwise expressly defined in Schedule A attached hereto and made a part hereof
by incorporation), non transferrable, and non-sublicensable, license to use the
Licensed Mark in the Territory solely in connection with the manufacture,
marketing, distribution and sale of Products strictly in accordance with the
terms of this Agreement. Products bearing the Licensed Mark that are sold by
Licensee hereunder are referred to as “Licensed Products.” It is understood and
agreed that this license shall pertain only to the Licensed Products and does
not extend to any other product or service.

 

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1.2 Licensed Products shall be of a fabrication, styling, and quality reasonably
appropriate for the Brand. All Licensed Products shall be constructed of such
quality, materials, componentry, and design as are approved in advance by
Licensor in accordance with the provisions hereof.

 

1.3 All Licensed Products shall bear the Licensed Mark in the form and manner
reasonably approved by Licensor and no Licensed Product shall be sold by
Licensee under any mark or other designation other than the Licensed Mark.

 

1.4 Licensor reserves all rights, express or implicit, to the Licensed Mark,
except those which are granted specifically to Licensee hereunder, including the
right to register and use any domain names that include or relate to the
Licensed Mark or any component, variation, simulation, derivation or
abbreviation thereof, and Licensor may exercise such rights in whole or in part
at any time.

 

1.5 The rights granted to Licensee do not include the right to operate a
boutique or in- store concession under the Licensed Mark or any variation,
simulation, derivation, and/or abbreviation thereof or otherwise sell Licensed
Products at retail.

 

1.6 Licensee shall use its reasonable best efforts to develop and promote
Licensed Products, to exploit the rights granted to it throughout the Territory
and vigorously promote the sale of Licensed Products consistent with the high
standards and prestige of the Licensed Mark. It is anticipated that Licensee
shall set its wholesale prices of Licensed Products at a level that would
encourage the development of sales of Licensed Products while maintaining the
image and prestige of the Brand. However, Licensee shall set its wholesale
prices for Licensed Products in its sole and absolute discretion.

 

1.7 Licensed Products shall not be (i) exported from the Territory, (ii) sold
outside the approved distribution channels within the Territory, or (iii) sold
to a retail customer if Licensee has reason to believe that such retail customer
may divert Licensed Products, including by reason of a previous history of
diversion of Licensed Products, other Products or any other products. To
“divert” means, for retail customers, to resell or otherwise transfer Licensed
Products other than to consumers.

 

2. Term of the Agreement. This Agreement and the provisions hereof, except as
otherwise provided, commence on the date hereof and shall continue through for
the period set forth on Schedule A attached hereto (the “Term”).

 

3. Royalty/Marketing.

 

3.1 In consideration for the license granted hereunder, Licensee agrees to pay
to Licensor, during the Term of this Agreement (including any Sell-Off period
pursuant to Paragraph 10 below), a royalty in the amount set forth in Schedule A
attached hereto (the “Royalty”) based on Licensee’s Net Sales (as defined below)
of Licensed Products.

 

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3.2 Licensee shall account for and pay the Royalty within thirty (30) days after
the close of each calendar quarter during each Annual Period (each such
quarterly period, the “Royalty Period”).

 

3.3 With each Royalty Payment, Licensee shall provide Licensor with a written
royalty statement in a form reasonably acceptable to Licensor. Such royalty
statement shall be certified as accurate by a duly authorized financial officer
of Licensee, reciting on a country-by-country basis, the stock number, item,
units sold, description, quantity shipped, gross invoice, amount billed
customers less discounts, returns and reportable sales for each Licensed
Product. Such statements shall be furnished to Licensor whether or not any
Licensed Products were sold during the Royalty Period.

 

3.4 Licensee agrees to pay to Licensor a Guaranteed Minimum Royalty in
accordance with the terms of Schedule A attached hereto (the “Guaranteed Minimum
Royalty”). As recited in Schedule A, a portion of the Guaranteed Minimum Royalty
for the first year shall be payable as an Advance against royalties (the
“Advance”). The actual royalty payments shall reflect the amount of all
Guaranteed Minimum Royalty payments including any Advances made.

 

3.5 “Net Sales” shall mean Licensee’s gross sales (the gross invoice amount
billed customers) of Licensed Products, less discounts, rebates and freight
charges actually shown on the invoice and, further, less any bona fide returns
(net of all returns actually made or allowed as supported by credit memoranda
actually issued to the customers). No other costs incurred in the manufacturing,
selling, advertising, and distribution of the Licensed Products shall be
deducted nor shall any deduction be allowed for any uncollectible accounts or
allowances. The Licensed Products shall not be used as give-a-ways and/or
premiums without the prior written consent of Licensor.

 

3.6 A Royalty obligation shall accrue upon the sale of the Licensed Products
regardless of the time of collection by Licensee. For purposes of this
Agreement, a Licensed Product shall be considered “sold” upon the date when such
Licensed Product is billed, invoiced, shipped, or paid for, whichever event
occurs first.

 

3.7 If Licensee sells any Licensed Products to any party affiliated with
Licensee, or in any way directly or indirectly related to or under the common
control with Licensee, at a price less than the regular price charged to other
parties, the Royalty payable Licensor shall be computed on the basis of the
regular price charged to other parties.

 

3.8 The receipt or acceptance by Licensor of any royalty statement, or the
receipt or acceptance of any royalty payment made, shall not prevent Licensor
from subsequently challenging the validity or accuracy of such statement or
payment.

 

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3.9 Upon expiration or termination of this Agreement, all Royalty obligations,
including any unpaid portions of the Guaranteed Minimum Royalty, shall be
accelerated and shall immediately become due and payable.

 

3.10 Licensee’s obligations for the payment ofa Royalty and the Minimum Royalty
shall survive expiration or termination of this Agreement and will continue for
so long as Licensee continues to manufacture, sell or otherwise market the
Licensed Products.

 

3.11 All payments due hereunder shall be made in United States currency drawn on
a United States bank, unless otherwise specified between the parties.

 

3.12 Late payments shall incur interest from the date originally due at the
lower of (i) the prime rate prevailing in New York City at Citibank, N.A. during
the period of delinquency plus three (3) percentage points or (ii) the maximum
rate of interest that can be legally charged to Licensee.

 

3.13 Licensee shall expend not less than $300,000 in the aggregate during the
initial term hereof on marketing and public relations expenses featuring
Licensed Products which have been approved by Licensor in accordance with the
terms of this Agreement.

 

4. Audit.

 

4.1 Licensor shall have the right, upon reasonable notice, to inspect Licensee’s
books and records and all other documents and material in the possession of or
under the control of Licensee with respect to the subject matter of this
Agreement at the place or places where such records are normally retained by
Licensee. Licensor shall have free and full access thereto for such purposes and
shall be permitted to be able to make copies thereof and extracts therefrom.

 

4.2 In the event that such inspection reveals a discrepancy in the amount of
Royalty owed Licensor from what was actually paid, Licensee shall pay such
discrepancy, plus interest, calculated at the rate of one percent (1%) per
month, or the maximum rate allowed by law iflower. In the event that such
discrepancy is in excess of five percent (5%) Licensee shall also reimburse
Licensor for the reasonable cost actually incurred of such inspection (including
reasonable attorney’s fees) incurred in connection therewith.

 

4.3 All books and records relative to Licensee’s obligations hereunder shall be
maintained and kept reasonably accessible and available to Licensor for
inspection for at least three

(3) years after termination of this Agreement.

 

4.4 In the event that an investigation of Licensee’s books and records is made,
certain confidential and proprietary business information of Licensee may
necessarily be made available to the person or persons conducting such
investigation. It is agreed that such confidential and proprietary business
information shall be retained in confidence by Licensor and shall not be used by
Licensor or disclosed to any third party, except for Licensor’s attorney’s,
accountants and business representatives on a need to know basis, or without the
prior express written permission of Licensee unless required by law. It is
understood and agreed, however, that such information may be used in any
proceeding based on Licensee’s failure to pay its Royalty obligation.

 

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5. Warranties and Representations.

 

5.1 Licensor warrants and represents that:

 

5.1.1 it has the right, power and authority to enter into this Agreement; and

 

5.1.2 this Agreement does not contravene any other agreement to which Licensor
is a party.

 

5.2 Licensee warrants and represents that:

 

5.2.1 it has full right, power and authority to enter this Agreement and the
execution, delivery and performance of this Agreement has been duly authorized
by all appropriate corporate action;

 

5.2.2 this Agreement does not contravene any other Agreement to which Licensee
is a party;

 

5.2.3 the Licensed Products and the manufacture, distribution, packaging,
promotion, advertising and labels associated with the Licensed Products shall
fully comply with all applicable laws and regulations;

 

5.2.4 the packaging, promotional and advertising materials associated with the
Licensed Products will not infringe upon the copyrights, patents, trademarks,
trade dress, or other intellectual property rights of any person, film, or
entity.

 

5.2.5 it will use its best efforts to promote, market, sell and distribute the
Licensed Products;

 

5.2.6 it has sufficient capital to operate and satisfy all financial obligations
hereunder;

 

5.2.7 it shall be solely responsible for the manufacture, production, sale and
distribution of the Licensed Products and will bear all related costs associated
therewith; and

 

5.2.8 Licensee agrees that it will not engage in any act or omission which may
diminish or impair the good will, name or reputation of either Licensor or the
Trademark including, but not limited to, utilizing any plant which manufactures
Licensed Products in violation of the laws of the country in which the plant is
located. Licensee further agrees not to employ workers under age sixteen (16) in
any plant which manufactures Licensed Products.

 

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5.3 It is the intention of the parties that Licensee shall introduce the
Licensed Products in all countries in the Territory on or before the Product
Introduction Date recited in Schedule A and commence shipment of Licensed
Products in all countries in the Territory on or before the Initial Shipment
Date recited in Schedule A. Wilful failure to meet either the Product
Introduction Date or the Initial Shipment Date shall constitute grounds for
immediate termination of this Agreement by Licensor.

 

6. Notices, Quality Control; Samples and Approvals.

 

6.1 The License granted hereunder is conditioned upon Licensee’s full and
complete compliance with the marking provisions of the Trademark, patent and
copyright laws of the United States and other countries in the Territory.
Licensee’s right to sell Licensed Products in a country in the Territory is
subject to any restrictions imposed by the government of the United States on
the sale of products to customers in such country.

 

6.2 The Licensed Products, as well as all promotional, packaging and advertising
material relative thereto, shall include all appropriate legal notices as
required by Licensor.

 

6.3 The Licensed Products shall be of a high quality which is at least equal to
comparable products manufactured and marketed by Licensee and in conformity with
a sample approved in writing by Licensor.

 

6.4 If the quality of any Licensed Product falls below the quality, as
previously approved by Licensor, Licensee shall use its reasonable best efforts
to restore such quality. In the event that Licensee has not taken appropriate
steps to restore such quality within fifteen (15) days after notification by
Licensor, and has not cured such quality within thirty (30) days after
notification by Licensor, then, in such event, Licensor shall have the right to
terminate this Agreement.

 

6.5 Prior to the commencement of manufacture and sale of the Licensed Products
hereunder, Licensee shall submit to Licensor, at no cost to Licensor and for
written approval as to quality, six (6) sets of samples of all Licensed Products
that Licensee intends to manufacture and sell and one (I) complete set of all
promotional and advertising material associated therewith. Licensor’s approvals
pursuant to this Agreement may be based solely on Licensor’s subjective
standards, including its aesthetic judgment regarding design, advertising,
marketing and exploitation and the Brand, and may be withheld in Licensor’s sole
and absolute discretion. Once such samples have been approved by Licensor,
Licensee shall not materially depart therefrom without Licensor’s prior express
written consent, which shall not be unreasonably withheld or delayed.

 

6.6 Licensee acknowledges that, while Licensor may disapprove an item submitted
for its approval hereunder, Licensor may not be able to express with any
specificity its objection to and/or the reason for its disapproval of any
particular item submitted for its approval hereunder.

 

6.7 At least once during each calendar year, Licensee shall submit to Licensor,
for approval, an additional six (6) sets of samples of all Licensed Products and
one set of all promotional and advertising materials that Licensee intends to
use in connection with the Licensed Products.

 

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6.8 Licensee agrees to permit Licensor or its representative to inspect the
facilities where the Licensed Products are being manufactured and packaged at
any time so requested by Licensor.

 

6.9 All Licensed Products shall be manufactured, offered for sale, sold,
labeled, packaged and distributed, and advertised, marketed, promoted,
publicized and otherwise exploited, in accordance with all applicable laws and
regulations throughout the Territory and the countries in which Licensed
Products are produced, including all child and other labor laws and regulations,
all customs requirements and country of origin regulations, those laws and
regulations relating to health and safety, such as flammability-related laws and
regulations, and those laws and regulations relating to the disclosure of
information to the consumer, such as truth-in-advertising and labeling laws and
regulations. Licensee shall monitor the performance of its manufacturers to
assure compliance with these laws and regulations in accordance with the laws of
the countries and the countries in which Licensed Products are produced.
Licensee promptly shall notify Licensor upon learning of a failure by any
manufacturer to comply with any such laws or regulations and shall take all
corrective actions as may be reasonably necessary or appropriate to prevent the
failure from recurring; and Licensee immediately shall terminate any
manufacturer that intentionally or repeatedly fails to comply with any such laws
or regulations. Licensee also shall test (or have the manufacturers test), as
appropriate, all Licensed Products, using independent certified laboratories, to
determine physical properties and all other required data, and provide Licensor,
upon request, with copies of all test results.

 

6.10 Licensee shall not, without prior written consent of Licensor, manufacture
any Licensed Products during the last two (2) calendar quarters of the Term
unless a valid purchase order for Licensed Product is received by Licensee which
requires delivery of Licensed Product prior to the end of the Term.

 

7. Notice and Payment.

 

7.1 Any notice required to be given pursuant to this Agreement shall be in
writing and delivered personally to the other designated party or delivered by a
recognized national overnight courier service, to the party concerned at the
address set forth on Schedule A attached hereto (or such other address as a
party may specify by notice in writing to the other).

 

8. The Licensed Mark

 

8.1 Licensee shall use and display the Licensed Mark only in the form and manner
designated or approved by Licensor from time to time hereunder. Licensor shall
notify Licensee ifit elects to change the form of the Licensed Mark and Licensee
shall effect the change as promptly as reasonably practicable. However, if,
after the change has been effected, Licensee has an inventory of Licensed
Products bearing the previous form of the Licensed Mark, Licensee may sell off
such Licensed Products, in the ordinary course.

 

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8.2 Both during and after the term of this Agreement, Licensee shall not use the
Licensed Mark or any component, variation, simulation, derivation or
abbreviation thereof, in whole or in part, as a corporate name, trade name,
domain name or otherwise except as expressly provided in this Agreement.
Licensee shall not join any name(s) with the Licensed Mark so as to form a new
mark. Licensee shall not use any name in connection with the Licensed Mark in
any materials or other printed matter. In that regard, Licensee acknowledges
that Licensor has not authorized Licensee to use the Licensed Mark or any
designation or identification relating to the Licensed Mark, Licensor or any
Licensed Product, other than as specifically provided in this Agreement.
Licensee shall not sign the Licensed Mark or any component, variation,
simulation, derivation or abbreviation thereof to any contracts, leases, bills
of sale or other instruments or hold itself out as a partner or co-venturer or
as a general or special agent of Licensor, nor shall Licensee establish any bank
accounts under the Licensed Mark or any component, variation, simulation,
derivation or abbreviation thereof.

 

8.3 Licensee acknowledges that, as between Licensee and Licensor, Licensor is
the owner of all right, title and interest in and to the Licensed Mark
throughout the Territory in any form or embodiment thereof and is also the owner
of the goodwill attached or that shall become attached to the Licensed Mark in
connection with the business and goods in relation to which the same has been,
is or shall be used. Sales by Licensee shall be deemed to have been made by
Licensor for purposes of trademark registration and, in that regard, all uses of
the Licensed Mark by Licensee shall inure to Licensor’s benefit. Neither
Licensee nor any of its affiliates (including Affiliated Distributors) or any of
the respective managers, officers, directors, members, shareholders, owners,
employees and agents of Licensee or any of its affiliates shall do anything or
suffer anything to be done, whether under or in connection with the business to
be conducted hereunder or this Agreement or otherwise, that may, directly or
indirectly, (a) adversely affect any rights of Licensor in and to the Licensed
Mark or any registrations thereof, (b) reduce or dilute the value of the
Licensed Mark or (c) disparage, dilute, detract from or reflect adversely upon
the Image and, in that regard, Licensee shall adopt and implement rigorous
quality control systems for Licensed Products. Hereinafter, any of the
affiliates of Licensee and any of the respective managers, officers, directors,
members, shareholders, owners, employees and agents of Licensee or any of its
affiliates shall be referred to collectively as the “Licensee Group.” Neither
Licensee nor any member of the Licensee Group shall seek to register the
Licensed Mark or any component, variation, simulation, derivation or
abbreviation thereof in any jurisdiction as a trademark or service mark for any
products or services. The provisions of and the obligations of Licensee and the
members of the Licensee Group shall survive Termination.

 

8.4 Licensee, at its expense, shall execute any documents, including registered
user agreements and short form license agreements, required to confirm
Licensor’s ownership of all rights in and to the Licensed Mark and the
respective rights of Licensor, Licensor and Licensee under or in connection with
this Agreement.

 

8.5 Licensee shall cooperate with Licensor in connection with the filing and
prosecution of applications in Licensor’s name to register the Licensed Mark for
Products in the various countries within the Territory. All costs reasonably
incurred by Licensor in connection therewith, including the costs of prosecuting
or defending opposition and cancellation proceedings and obtaining clearance
negotiated payments and the costs of the maintenance and renewal of any
registrations that hereafter may issue, as well as attorneys’ fees, search costs
and filing fees, shall be solely and exclusively borne by Licensor.

 

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8.6 Licensee shall not use the Licensed Mark, nor may any Licensed Products be
advertised, marketed, promoted, publicized or otherwise exploited or
distributed, offered for sale or sold, (A) in any Country in which the Licensed
Mark had not theretofore been registered in the applicable trademark class for
Products or an application to register the Licensed Mark in such class for
Products has not theretofore been filed, until (I) an appropriate trademark
search has been conducted and an application to register the Licensed Mark for
Products has been filed in such Country or (2) Licensor determines that it would
be preferable not to seek to register the Licensed Mark for Products in such
Country but that there is no material impediment to the use of the Licensed Mark
therein, and (3) Licensor notifies Licensee that it may do so, and (B) in a
British Commonwealth Country, or any other Country where required, prior to the
execution of a registered user agreement or similar type agreement approved by
Licensor and the filing thereof with the appropriate governmental agency.

 

8.7 Licensee shall use the Licensed Mark in each country strictly in compliance
with the legal requirements of, or in effect within, each such country. Licensee
shall place on all Licensed Products and all ancillary materials all legends,
markings and notices (i) required to give appropriate notice of any trademark or
other rights in or to the Licensed Mark in accordance with the governing
trademark and other applicable laws, rules and regulations of, or in effect
within, the various countries or (ii) otherwise reasonably requested by
Licensor.

 

8.8 Neither Licensee nor any member of the Licensee Group shall challenge
Licensor’s ownership of or the validity of the Licensed Mark, any application
for registration or registration of the Licensed Mark or any rights of Licensor
or Licensor in the Licensed Mark. The provisions of and the obligations of
Licensee and the members of the Licensee Group shall survive Termination.

 

8.9 If Licensee learns of any infringement, imitation or counterfeiting of the
Licensed Mark or Licensed Products or of any use of a trademark similar to the
Licensed Mark or of any instances of the importation and sale in any country of
otherwise legitimate Products bearing the Licensed Mark (including Licensed
Products) by any third party, it shall notify Licensor thereof. Upon receipt of
Licensee’s notice or when any such situation comes to their attention, Licensor
and Licensor shall take such action as they in their sole discretion deem
advisable for the protection of their rights in and to the Licensed Mark and
Licensed Products. If requested by Licensor, Licensee shall reasonably cooperate
with and follow the reasonable directions of Licensor in connection therewith,
including by conducting investigations to determine the extent of the
infringement or counterfeiting activity, acting as a plaintiff or co-plaintiff
in lawsuits and causing its officers to execute pleadings and other related
documents. Licensor shall not be required to take any action if it deems it
inadvisable to do so (and in its sole discretion may discontinue any action it
may commence) and Licensee may not take any action with respect to the Licensed
Mark or the counterfeiting or diversion of Licensed Products without Licensor’s
prior approval. The costs, fees and expenses (including investigatory expenses
and legal expenses such as attorneys’ fees, court costs and filing fees)
incurred in connection with any action relating to Products taken hereunder
shall be borne by Licensee.

 

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9. Intellectual Property Rights

 

9. 1 Any trademark, copyright, design right, moral right or similar such right
and any other intellectual property right in or that may be created in any
Licensed Products (or any aspect thereof) or any packaging materials or
marketing materials, including photographs, designed or approved by Licensor
(each an “IP Right”) shall be, as between Licensor and Licensee, the exclusive
property of Licensor. If any of such Licensed Products (or any aspect thereof)
or packaging materials or marketing materials are not designed and/or created by
Licensor or its designee, they shall be deemed “works made for hire” for
Licensor or its designee within the meaning of the U.S. Copyright Law and/or
other applicable comparable laws or, if they do not so qualify, all ownership
rights thereto, including any of Licensor’s IP Rights therein, shall be deemed
assigned to Licensor or its designee. Licensee shall cooperate with the owner
thereof in the preparation, filing and prosecution of applications in the name
of Licensor or its designee to record any claims to Licensor’s IP Rights in any
Licensed Product (or any aspect thereof), packaging material or marketing
material. Neither Licensee nor any member of the Licensee Group shall do
anything or suffer anything to be done that may affect adversely any of the
rights of Licensor or its designee in Licensed Products (or any aspect thereof)
or in any packaging materials or marketing materials, including filing any
application in its name to record any claims to any of Licensor’s IP Rights in
any Licensed Products (or any aspect thereof) or in any packaging materials or
marketing materials, and shall do all things required by Licensor to preserve
and protect those rights, including placing the copyright notice specified by
the Universal Copyright Convention or otherwise on all Licensed Products, and on
all packaging materials and marketing materials.

 

9.2 Licensee represents and warrants that the Licensed Products and the
materials used in connection with Licensed Products, as well as any product
names adopted for use in connection with any particular Licensed Products, will
not violate the intellectual property rights of any third party and it shall be
Licensee’s responsibility, at its expense, to obtain all necessary clearances
for the Licensed Products, the materials and the product names used in
connection with Licensed Products.

 

10. Termination. The following termination rights are in addition to the
termination rights provided elsewhere in the Agreement:

 

10.1 Immediate Right of Termination. Licensor shall have the right to
immediately terminate this Agreement by giving written notice to Licensee in the
event that Licensee does any of the following:

 

10.1.1 fails to meet the Product Introduction Date or the Initial Shipment Date
as specified in Schedule A;

 

10.1.2 after having commenced sale of the Licensed Products, fails to sell
Licensed Products for two (2) consecutive Royalty Periods; or

 

10.1.3 fails to obtain or maintain general liability insurance in the amount and
of the type provided for herein; or

 

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10.1.4 files a petition in bankruptcy or is adjudicated a bankrupt or insolvent,
or makes an assignment for the benefit of creditors, or an arrangement pursuant
to any bankruptcy law, or if the Licensee discontinues its business or a
receiver is appointed for the Licensee or for the Licensee’s business and such
receiver is not discharged within thirty (30) days; or

 

10.1.5 breaches any of the provisions of this Agreement relating to the
unauthorized assertion of rights in the Property and/or the Trademark; or

 

10.1.6 fails, after receipt of written notice from Licensor, to immediately
discontinue the distribution or sale of the Licensed Products or the use of any
packaging or promotional material which does not contain the requisite legal
legends; or

 

10.1.7 fails to make timely payment of Royalties when due if not cured within
ten (10) days upon notification.

 

10.2 Immediate Right to Terminate a Portion. Licensor shall have the right to
immediately terminate the portion(s) of the Agreement relating to any Product(s)
and/or for any country in the Territory if Licensee, for any reason, fails to
meet the Product Introduction Dates or the Initial Shipment Dates specified in
Schedule A or, after the commencement of manufacture and sale of a particular
Licensed Product in a particular country, ceases to sell commercial quantities
of such Licensed Product in such country for two (2) consecutive Royalty
Periods.

 

10.3 Right to Terminate on Notice. This Agreement may be terminated by either
party upon at least thirty (30) days prior written notice to the other party
hereto in the event of a material breach of a material provision of this
Agreement by the other party, provided that, during the thirty

(30) days period, the breaching party fails to cure such breach.

 

10.4 Additional Termination Right. Licensee shall have the additional rights of
termination as set forth in Schedule A.

 

11. Post Termination Rights.

 

11.1 Not less than thirty (30) days prior to the expiration of this Agreement or
immediately upon termination thereof, Licensee shall provide Licensor with a
complete schedule of all inventory of Licensed Products then on-hand (the
“Inventory”).

 

11.2 Upon expiration or termination of this Agreement, except for reason of a
material breach of Licensee’s duty to comply with the quality control or legal
notice marking requirements, Licensee shall be entitled, for an additional
period of three (3) months (the “Sell-off Period”) and on a non-exclusive basis,
to continue to sell such Inventory. Such sales shall be made subject to all of
the provisions of this Agreement and to an accounting for and the payment of a
Royalty thereon. Such accounting and payment shall be due and paid within thirty
(30) days after the close of the Sell-off Period.

 

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11.3 Upon the expiration or termination of this Agreement, all of the rights of
Licensee under this Agreement shall forthwith terminate and immediately revert
to Licensor and Licensee shall immediately discontinue all use of the Property
and the like, at no cost whatsoever to Licensor.

 

11.4 Upon termination of this Agreement for any reason whatsoever, Licensee
agrees to immediately return or provide certified proof of destruction to
Licensor all material relating to the Property including, but not limited to,
all artwork, color separations, prototypes and the like, as well as any market
studies or other tests or studies conducted by Licensee with respect to the
Property, at no cost whatsoever to Licensor.

 

12. Infringements. When Licensee becomes aware that a third party is or may be
engaged in the unauthorized use of the Property or Trademark, Licensee shall
promptly give Licensor written notice thereof, which notice shall fully describe
the potentially infringing actions by such third party. Licensee shall not take
any other action regarding such infringement or possible infringement without
Licensor’s written approval. Licensee shall cooperate with the Licensor at no
out-of-pocket expense to Licensee in connection with any action taken by the
Licensor to terminate infringements. After each Party is reimbursed for any cost
or expenses actually incurred in pursuing an infringement, Licensee shall share
with Licensor, on a pro-rata basis, in the proceeds of any award from or
settlement of an infringement action to the extent that such award or settlement
reflects damages to Licensee’s rights.

 

93. Indemnity.

 

93.1 Licensee agrees to indemnify and hold Licensor harmless from all third
party claims, liabilities, causes of action, judgments, damages, losses and
expenses (including reasonable attorneys’ fees) arising out of or resulting from
(i) any breach by Licensee of any representation, warranty, term and/or covenant
herein; (ii) any actual or alleged defects in Licensed Products including the
packaging or in its manufacture or distribution whether or not grounded in
products liability or breach of warranty (as to performance characteristics or
otherwise); (iii) any use, manufacture, distribution or sale of Licensed
Products; or (iv) any actual or alleged infringement of any patents, copyrights,
trademarks or other rights such as trade secrets and rights of publicity and
privacy resulting from the manufacture, distribution, sale and advertisement of
Licensed Products.

 

93.2 Licensor agrees to indemnify and hold Licensee harmless from all third
party claims, liabilities, causes of action, judgments, damages, losses and
expenses (including reasonable attorneys’ fees) arising out of any breach of
Licensor’s representations and warranties; provided however, that such indemnity
shall only be applicable in the event of a final decision by a court of
competent jurisdiction from which no appeal of right exists. Further, this
indemnity does not cover any modifications or changes made to the Property or
Trademark by Licensee.

 

93.3 Paragraphs 13.1 and 13.2 shall survive the expiration or termination of
this Agreement.

 

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1 04. Insurance. Licensee shall, at its own expense, procure and maintain in
full force and effect for so long as Licensed Products are sold, with an
insurance carrier with the highest rating established by Best’s Rating Guide,
(i) a comprehensive general liability and product liability insurance policy
with respect to Licensed Products and this Agreement, with a limit ofliability
of not less than US$2,000,000.00, (ii) commercial automobile liability insurance
with limits ofbodily injury and property damage of not less than US$
I,000,000.00 per occurrence, and (iii) workers’ compensation insurance with
statutory limits and with an employer liability limit of at least US$2,000,000.
Each such insurance policy shall be written for the benefit of Licensee,
Licensor and the other members of the Lifeguard Group, shall be designated
expressly as primary insurance and shall provide for at least thirty (30) days
prior written notice to Licensee and Licensor of the cancellation or substantial
modification thereof. If the insurance policy is canceled, it shall be replaced
by a substantially equivalent policy prior to its cancellation. Licensee may
obtain the insurance in conjunction with a policy of liability insurance that
covers products other than Licensed Products. Licensee and its insurers shall
waive all rights of subrogation against one another for property damage claims.
Licensee shall deliver a certificate of insurance to Licensor promptly upon its
issuance and shall furnish to Licensor evidence of the maintenance of the policy
upon request. Nothing in this Section 14 is intended to limit or affect the
indemnification provisions of Section 13.I.

 

115. Force Majeure. It is understood and agreed that in the event of an act of
the government, or war conditions, or fire, flood or labor trouble in the
factory of Licensee or in the factory of those manufacturing parts necessary for
the manufacture of the Licensed Products, which prevents the performance by
Licensee of the provisions of this Agreement, then, in such event, such
nonperformance by Licensee shall not be considered as grounds for material
breach of this Agreement and such nonperformance shall be excused while the
conditions herein prevail and for two (2) months thereafter; provided, however,
that in no event shall such nonperformance by Licensee be excused due to any
such event for longer than ninety (90) consecutive days. In addition, Licensor
shall have the right to terminate this Agreement if any matter referred to in
this Paragraph 15 continues for longer than thirty (30) consecutive days or
sixty (60) days in the aggregate.

 

16. Governing Law. This Agreement shall be enforced, governed by, and the rights
of the parties shall be construed in accordance with, the laws of the State of
New York applicable to contracts made and fully performed therein, without
regard to the conflicts of law provisions thereof.

 

17. Jurisdiction and Disputes.

 

17.1 Except as specifically set forth in this Agreement, all disputes,
controversies and claims arising out of or relating to this Agreement except
disputes, controversies and claims relating to or affecting Licensor’s ownership
of or the validity of the Licensed Mark or any registration thereof, or any
application for registration thereof (“Licensed Mark Disputes”) be settled and
determined by arbitration in New York City before a Commercial Panel of three
arbitrators in accordance with and pursuant to the then existing Commercial
Arbitration Rule the American Arbitration Association. The arbitrators, in their
discretion, may award speci performance or injunctive relief (but not punitive
damages) (and reasonable attorneys’ fees and expenses) to any party in any
arbitration and the courts also may do so with regard to injunctive relief
sought by Licensor and with regard to Licensed Mark Disputes (collectively,
“Court Actions”). However, in any arbitration proceeding, the arbitrators may
not change, modify or alter any express condition, term or provision hereof, and
to that extent the scope of their authority is expressly limited. The
arbitration award shall be final and binding upon the parties and judgment may
be entered thereon in any court having jurisdiction. The service of any notice,
process, motion or other document in connection with an arbitration or for the
enforcement of any arbitration award may be made in the same manner that Notices
may be given under Section 7.1.

 

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17.2 Court Actions shall be brought in New York City in any court having
jurisdiction, except that Licensor also may bring an injunctive proceeding in
any jurisdiction where appropriate by reason of its subject matter. Licensor and
Licensee irrevocably submit to the jurisdiction of the state and Federal courts
in New York City and the courts in such other jurisdictions in Court Actions and
waive any claim or defense of inconvenient forum or lack of personal
jurisdiction in such forum under any applicable law or decision or otherwise.
Service of any notice, process, motion or other document in connection with a
Court Action may be made in the same manner that Notices may be given under
Section 7.1. However, Licensor may serve process in any manner permitted by the
laws of the State ofNew York, or by the state or Federal courts located therein,
or by the laws or courts of any applicable Country or any subdivision thereof.

 

18. Confidentiality. All of the contents of this Agreement and all information
relating to the business, operations and personnel of the Licensor that Licensee
learns or has learned during or prior to the term of this Agreement, including
all financial information and business plans relating to the business of
Licensor or any of its affiliates, and all creative concepts, including the
marketing, advertising and promotional concepts and plans that Licensor provides
to Licensee or that Licensor approves for use in connection with Licensed
Products (“Confidential Information”), are its valuable property. Licensee
acknowledges the need to preserve the confidentiality and secrecy of the
Confidential Information. Therefore, during the term of this Agreement and
thereafter, neither Licensee nor any member of the Licensee Group shall use or
disclose any of the Confidential Information, except for such use by or on
behalf ofLicensee that is permitted under this Agreement. Licensee shall take
all necessary steps to ensure that any use by it and those acting on its behalf,
including the members of the Licensee Group, and its suppliers, shall preserve
the confidentiality and secrecy thereof. In that regard, Licensee shall
implement appropriate internal procedures to ensure that those individuals
working for the business do not share Confidential Information with other
employees of Licensee (or any other person). Licensee shall indemnify the
Licensor against any damage that may be suffered by any of them as a result of
any breach by Licensee, any of the members of the Licensee Group, or any of
Licensee’s suppliers of the provisions of this Section. The provisions of and
the obligations of Licensee and the members of the Licensee Group shall survive
Termination.

 

19. Waiver. No waiver by either party of any material default shall be deemed as
a waiver of prior or subsequent default of the same or other provisions of this
Agreement.

 

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20. Severability. Whenever possible, each provision of the Agreement will be
interpreted in such manner as to be effective and valid under applicable law.
However, if any term, clause or provision hereof is held invalid or
unenforceable by a court of competent jurisdiction, such invalidity shall not
affect the validity or operation of any other term, clause or provision and such
invalid term, clause or provision shall be deemed to be severed from the
Agreement.

 

21. No Joint Venture. Nothing contained herein shall constitute this arrangement
to be employment, a joint venture or a partnership. Furthermore, the Parties
hereto fully intend to act and perform as independent contractors, and the
provisions hereof are not intended to create any agency, partnership,joint
venture, employment relationship and/or other fiduciary relationship of any kind
and/or nature whatsoever between the parties hereto other than that of
independent parties contracting with each other solely to carry out the
provisions of this Agreement for the express purposes recited herein. Each party
hereto shall be, and shall remain, the employer of its own respective agents,
servants, employee and/or consultants. Such personnel shall at no time be deemed
to be the agents, servants, employee and/or consultants of the other party
hereto and shall not be entitled and/or be eligible to participate in any manner
whatsoever in any benefits and/or privileges (including, but not limited to,
health insurance, dental insurance, disability insurance, vacation pay, sick
leave, retirement benefits, pension plans, social security, worker’s
compensation, health or disability benefits, unemployment insurance benefits, or
other benefits etc., if any, on account ofthis Agreement) of any kind and/or
nature whatsoever provided and/or extended by the other Party to such other
party’s own members, officers, directors, agents, servants, employees and/or
contractors in connection therewith. Each party hereto agrees to be solely and
entirely responsible for paying any and all applicable taxes required by law
such as payroll, income, withholding and social security taxes.

 

22. Assignability. The performance of Licensee is of a personal nature and,
therefore, neither this Agreement nor the license or other rights granted to
Licensee may be assigned, sublicensed or transferred by Licensee and any
attempted assignment, sublicense or transfer, whether voluntary or by operation
of law, directly or indirectly, shall be void and of no force or effect. The
direct or indirect transfer or issuance of shares of Licensee or the direct or
indirect transfer (including by entering into a stockholders or other agreement
or by granting a proxy) of the voting rights of shares or the issuance by
Licensee of any other voting securities or the entering into by Licensee of a
management or other agreement with a party that is not controlled by or under
the common control of Licensee, shall constitute an impermissible transfer if,
and only if, it limits or reduces in any material respect the rights or ability
of Licensee to control the Business. This Agreement shall inure to the benefit
of and shall be binding upon the parties, Licensor’s successors and assigns and
Licensee’s permitted successors and assigns.

 

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23. Integration. This Agreement constitutes the entire understanding of the
parties, and revokes and supersedes all prior agreements between the parties,
including any option agreements which may have been entered into between the
parties, and is intended as a final expression of their Agreement. It shall not
be waived, modified, amended and/or chagned except in writing signed by the
parties hereto and specifically referring to this Agreement. This Agreement
shall take precedence over any other documents which may be in conflict with
said Agreement. This Agreement contains all the terms, provisions, covenants
and/or promises of any kind and/or nature whatsoever entered into by and between
the parties hereto concerning this Agreement and shall merge and supersede any
and all prior and/or other terms, agreements, provisions, covenants, and/or
conditions, if any, not expressly set forth in this Agreement. Any and all prior
understandings, agreements, representations and/or warranties, oral and/or
written, if any, between any of the Parties hereto concerning this Agreement are
merged in, and superseded by, this Agreement and completely expresses the full
agreement between the parties hereto and has been entered into only after full
investigation, no party relying upon any statements, agreements, representations
and/or warranties, oral and/or written, made by anyone that is not expressly set
forth in this Agreement. No additional terms are implied by usage of trade, by
course ofdealing, or by course of performance. In the event of any conflict or
inconsistency between the terms and conditions of the main body of this
Agreement and those of Schedule A attached hereto, then, in such event, the
terms and conditions of such Schedule A attached to this Agreement shall
supersede and control over this Agreement. This Agreement may be executed in
multiple counterparts, each of which shall be deemed a binding and enforceable
original, and all of which together shall be deemed one and the same Agreement.
A signed copy of this Agreement delivered by e-mail or other means of electronic
transmission shall be deemed to have the same legal effect as delivery of an
original signed copy of this Agreement and shall be admissible for any and all
purposes in any court of law and/or other tribunal.

 

24. Third Party Beneficiary. Unless this Agreenent expressly states to the
contrary, this Agreement may not otherwise be construed to create any
third-party beneficiary rights in any other individual, partnership,
corporation, or entity.

 

IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby,
have each caused to be affixed hereto its or his/her hand and seal as of the
Effective Date first indicated above.

 

  LIFEGUARD LICENSING CORP.         By:                  Name:     Title:  

 

  CANBIOLA, INC.         By: /s/ Marco Alfonsi   Name: Marco Alfonsi   Title:
Chief Ececutive Officer

 

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SCHEDULE “A”

 

1. Products.

 

The following Products form part of this Agreement:

 

Lip care products: balms, moisturizers, cold-sore treatments; and

 

Topical pain relief products: salves, sprays, and gels including sunburn relief,
rashes, abrasions; and

 

Energy shots, gununy bears and candy, cookies and pastry; and

 

Non-Alcoholic Beverages: fruit-based drinks, protein type drinks, carbonated
type drinks; and

 

Alcoholic beverages: beer, hard alcohol, and wine; and

 

EACH AND ALL PRODUCTS MAY OR MAY NOT CONTAIN CBD, may be for

animals (pets) or human use or consumption, and will have appropriate label,
analysis, and meet all governmental requirements for each category of products.

 

Licensee acknowledges and agrees that it will refrain from the manufacture,
production, promotion and/or sale of all manner of (i) alcoholic beverages, (ii)
energy shots and (iii) pain relief products for animals (pets), until advised
further by Licensor.

 

2. Exclusivity

 

Notwithstanding anything express and/or implied to the contrary which may be set
forth in the Agreement, an exclusive as to the above mentioned Products in the
Territory noted below.

 

3.Territory

 

The following countries shall constitute the Territory:

 

The United States of America, its territories and possessions, Canada and Mexico

 

4. Term

 

This Agreement shall commence on the date hereof and continue through December
31, 2025. The first annual period shall commence as of the date hereof and end
on December 31, 2021. Licensor shall have the right to terminate this Agreement
upon notice if Licensee fails to achieve the “Minimum Net Sales” amount for the
applicable annual period. Licensee shall have the right to renew this Agreement
for (i) an additional five (5) year period provided that Licensee shall have
achieved $3,000,000.00 in Net Sales during the final annual period of the
initial term and Licensee provides Licensor written notice of Licensee’s intent
to renew by no later than September 30, 2025; (ii) for an additional five (5)
year period provided that Licensee shall have achieved $10,000,000.00 in Net
Sales during the tenth annual period and Licensee provides Licensor written
notice of Licensee’s intent to renew by no later than September 30, 2030; and
(iii) for an additional five (5) year period provided that Licensee shall have
achieved $15,000,000 in Net Sales during the fifteenth annual period and
Licensee provides Licensor written notice of Licensee’s intent to renew by no
later than September 30, 2035.

 

   

 

 

5. Royalty Rate

 

Licensee shall pay the following royalty rate: six (6%) percent

 

6. Guaranteed Minimum Royalty, Guaranteed Minimum Sales and Advance

 

Guaranteed Minimum Royalty (“GMR”) and Minimum Net Sales (“MNS”) are as follows:

 

Period  GMR   MNS  First (Date hereof through 12/31/21)  $60,000   $1,000,000 
Second (l /1/22 to 12/31/22)  $66,000   $1,100,000  Third (1/1/23 to 12/31/23) 
$72,600   $1,210,000  Fourth (1/1/24 to 12/31/24)  $79,860   $1,331,000  Fifth
(1/1/25 top 12/31/25)  $87,846   $1,464,100  If Renewed:           Sixth 
$96,630   $1,610,510  Seventh  $106,293   $1,771,561  Eighth  $116,923  
$1,948,717  Ninth  $128,615   $2,143,588  Tenth  $141,476   $2,357,947  If
Renewed:           Eleventh  $155,624   $2,593,742  Twelfth  $171,187  
$2,853,116  Thirteenth  $188,305   $3,138,428  Fourteenth  $207,136  
$3,452,271  Fifteenth  $227,849   $3,797,498 

 

7. Product Introduction/Initial Shipment

 

NIA

 

8. Notice Address

 

If to Licensor: Lifeguard Licensing Corp.   595 Madison Avenue, Suite 1101   New
York, New York 10022   Attn: Chief Executive Officer     With a copy to:
McNiffLaw Group   113 Howland Avenue   Jamestown, RI 02835     If to Licensee:
Canbiola, Inc.,   960 South Broadway, Suite 120   Hicksville, New York 11801