Document:

exv10w1

 

Exhibit 10.1

SIXTH AMENDMENT TO EMPLOYMENT AGREEMENT

     THIS SIXTH AMENDMENT TO EMPLOYMENT AGREEMENT (this “Sixth 
Amendment”), dated as of August 14, 2006, is by and
between Wild Oats Markets, Inc. (the “Company”) and Perry D. Odak (the “Executive”).

RECITALS

     A. The Executive and the Company entered into an Employment Agreement, dated
as of March 6, 2001, as amended by a First Amendment to Employment Agreement, dated as of
December 28, 2001, a Second Amendment to Employment Agreement, dated as of June 19,
2002, a Third Amendment to Employment Agreement, dated as of August 12, 2002, and a
Fourth Amendment to Employment Agreement, dated as of May 10, 2005 and a Fifth Amendment to
Employment Agreement, dated as of June 16, 2006 (collectively referred
to herein as the “Employment Agreement”).

     B. The parties intend to enter into good faith negotiations to enter into mutually
satisfactory modifications to the Employment Agreement.

     C. The Company has the right to give notice of non-renewal of the Employment
Agreement prior to August 15, 2006, and has asked the Executive
to agree to extend this notice deadline, to provide additional time for their negotiations.

     D. The Executive has agreed to the Company’s request for an extension of the notice
deadline on the terms and conditions set forth below.

AGREEMENT

     For good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

     1. Amendments to the Employment Agreement.

          (a) Term of the Employment Agreement. Section 2 of the Employment
Agreement is hereby amended by deleting the penultimate sentence
thereof, and replacing it with the following:

     “This Agreement shall continue on a year-to-year basis
beyond the end of the fifth year (or a later year if the Agreement
has renewed), unless the Company notifies the Executive in
writing that the Company does not wish to renew the Agreement.
With respect to the year ending March 19, 2007, any such notice of
non-renewal must be given by no later than October 16, 2006 (the
period between June 19, 2006 and October 16, 2006 being referred to
as the “Extended Notice Period”), and with respect to any future
years after March 19, 2007, any such notice of non-renewal must be
given by no later than nine months prior to the end of the
applicable year.”

          (b) Termination of Employment by the Executive for Good Reason. Sections
5(e)(6) and (7) of the Employment Agreement is amended to read as follows:

 

 

     ”(6) In the event that the Company shall, in bad faith, fail
to engage in negotiations during the Extended Notice Period
regarding a new employment agreement or modifications to the
Agreement (for example, the conducting of parallel negotiations
with third parties with respect to Executive’s positions or the
refusal by the Company to negotiate with Executive shall be deemed
to be in “bad faith” but the inability or failure by the parties to
agree on mutually satisfactory terms shall not in and of itself
constitute “Good Reason” hereunder); or

     (7) During the Extended Notice Period, providing the Executive
with a notice of non-renewal pursuant to Section 2 of this
Agreement prior to October 13, 2006.”

     2. Defined Terms. All terms which are capitalized but are not otherwise defined
herein shall have the meaning ascribed to them in the Employment Agreement.

     3. Inconsistent Provisions. All provisions of the Employment Agreement which
have not been amended by this Sixth Amendment shall remain in full force and effect. However,
to the extent that there is any inconsistency between the provisions of the Employment
Agreement and this Sixth Amendment, the provisions of this Sixth Amendment shall control and
be binding.

     4. Counterparts. This Sixth Amendment may be executed in one or more
counterparts, all of which taken together shall constitute a single
instrument. Execution and delivery may be by facsimile transmission.

 

 

     IN WITNESS WHEREOF, this Sixth Amendment to Employment Agreement has been
executed by the Company, by its duly authorized officer, and by the
Executive, as of the date first above written.

	 	 	 	 	 	 	 
	WILD OATS MARKETS, INC.	 	THE EXECUTIVE
	 
	 	 	 	 	 	 
	By:	 	/s/ Freya R. Brier	 	/s/ Perry D. Odak
	 	 	 	 	 
	Name:

	 	Freya R. Brier
	 	Name:
	 	Perry D. Odak
	Title:

	 	Executive OfficerExhibit 10.38

 

***CERTAIN CONFIDENTIAL
INFORMATION CONTAINED IN THIS DOCUMENT (INDICATED BY ASTERISKS) HAS BEEN
OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER 17 C.F.R. SECTIONS
200.80(B)(4), 200.83 AND 230.406.

 

LICENSE
AGREEMENT

 

THIS AGREEMENT, entered
into and effective as of the 15TH day of July, 1999 (the “Effective Date”) by
and between TRISTRATA TECHNOLOGY, INC., a Delaware corporation having its
principal place of business at 1105 North Market Street, Suite 1300, P.O. Box
8985, Wilmington, Delaware 19899 (hereinafter referred to as “LICENSOR”) and
MDF Acquisition Corp. a Delaware corporation having a principal place of
business at 10455 Pacific Center Court, San Diego, CA 92121, (hereinafter
referred to as “LICENSEE”);

 

RECITALS

 

WHEREAS, LICENSEE has
purchased from Allergan, Inc. certain product lines sold under a July 1,
1995 License Agreement between LICENSOR and Allergan, Inc.; and

 

WHEREAS, LICENSEE has
consented to a partial assignment of Allergan, Inc.’s rights and
obligations under the July 1, 1995 License Agreement to LICENSEE on the
terms and conditions contained in this Agreement; and

 

WHEREAS, LICENSEE In the
course of its business sells cosmetic and skin care products and is interested
in obtaining from LICENSOR a license to make, have made, use, distribute and/or
sell Licensed Products under the Licensed Patent Rights (as hereinafter
defined); and

 

WHEREAS, LICENSOR owns or
has the right to grant licenses under the Licensed Patent Rights (as
hereinafter defined) for use in connection with the Licensed Products (as
hereinafter defined, subject to the pre-existing exclusive rights of Avon
Products, Inc. and certain of its affiliated companies (“Avon”) pursuant to
the attached portions of a License Agreement, effective April 1, 1994
between LICENSOR and Avon (the “Avon License Agreement”); and

 

 

WHEREAS, LICENSEE has
independently examined those portions of the Licensed Patent Rights (as
hereinafter defined) consisting of the prosecution histories of the issued
patents listed on Schedule A hereto and, to the best of LICENSEE’S
knowledge and belief, the Licensed Patent Rights are valid and enforceable; and

 

WHEREAS, subject to, and
upon, all of the terms and conditions of this Agreement, LICENSOR is willing to
grant to LICENSEE a non-exclusive license to make, have made, use and sell the
Licensed Products (as hereinafter defined);

 

NOW, THEREFORE, in
consideration of the foregoing premises and of the mutual covenants, promises
and agreements set forth herein, LICENSOR and LICENSEE hereby mutually agree as
follows:

 

ARTICLE I
- GENERAL

 

1.01
Subject to all of the terms and conditions hereunder, LICENSOR consents to a
partial assignment of the rights and obligations under the July 1, 1995
License Agreement between LICENSOR and Allergan, Inc. to LICENSEE.

 

1.02
All capitalized terms used in this
Agreement (other than the names of parties and Article headings) shall
have the meanings established for such terms herein.

 

1.03
LICENSEE acknowledges that LICENSEE has been advised by LICENSOR of the rights
granted by LICENSOR pursuant to the Avon License Agreement, as set forth in the
pages of the Avon License Agreement attached hereto, and that,
notwithstanding anything to the contrary in this Agreement, LICENSEE’s rights
hereunder are subject to such rights of Avon.

 

1.04
LICENSEE has independently examined those portions of the Licensed Patent
Rights (as defined in Section 2.02), consisting of the prosecution
histories of the issued patents listed on Schedule A hereto and, to the
best of LICENSEE’S  knowledge and belief,
the Licensed Patent Rights are valid and

 

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enforceable, and LICENSEE
is desirous of obtaining a license from LICENSOR under said Licensed Patent
Rights upon all of the terms and conditions set forth in this Agreement.

 

ARTICLE II
- DEFINITIONS

 

2.01
“Excluded Channel of Trade” shall mean the mail order, multi-level and direct
door-to-door markets. Notwithstanding the Excluded Channel of Trade herein,
LICENSEE may process orders made by customers of LICENSEE as a result of 800
telephone, toll-free telephone or telephone orders, provided that LICENSEE and
its Affiliates shall not employ television, including without limitation,
television infomercials, to advertise any 800 telephone, toll-free telephone or
any telephone numbers to take, process or receive sales orders.

 

2.02
“Licensed Patent Rights” shall mean, subject to the specific exclusions set
forth in Sections 1.03 and 2.03, those portions of the patents and patent
applications set forth in Schedule A hereto, as Schedule A may from
time to time be amended, and all divisions, continuations,
continuations-in-part, reissues, reexaminations and extensions thereof; (a) covering
only cosmetic and dermatologic preparations containing glycolic acid and/or its
salts for: (1) the treatment of human skin wrinkles and/or fine lines on
the human skin; (2) the treatment of dry skin; (3) as a skin
cleanser; (4) as a hair conditioner; (5) as a shampoo; (b) covering
only cosmetic and dermatologic preparations containing glycolic acid and/or its
salts, in combination with salicylic acid for the treatment of acne; and (c) covering
only cosmetic and dermatologic preparations containing glycolic acid and/or its
salts in combination with two percent (2%) or less of hydroquinone for the
treatment of pigmented spots on human skin.

 

2.03
Notwithstanding anything herein to the contrary, “Licensed Patent Rights” shall
not include any rights to a patent or patent application on an invention unless
such rights relate to:

 

(a)                     glycolic acid
and/or its salts; and

 

(b)                    a method for
using glycolic acid and/or its salts or

 

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compositions containing
glycolic acid and/or its salts, for: (1) the treatment of human skin
wrinkles or fine lines on the human skin by topically applying compositions
containing glycolic acid or a salt thereof to human skin; (2) the
treatment of dry skin; (3) as a skin cleanser; (4) as a hair
conditioner, and (5) as a shampoo;

 

(c)                     a method for
using glycolic acid and/or its salts, in combination with salicylic acid for
the treatment of acne; or

 

(d)                    a method for
using glycolic acid and/or its salts, in combination with two percent (2%) or
less of hydroquinone for the treatment of pigmented spots on human skin.

 

2.04
“Licensed Products” shall include any cosmetic and/or dermatologic preparation
covered by the Licensed Patent Rights: (a) containing glycolic acid and/or
its salts: (1) for the treatment of human skin wrinkles and/or fine lines
on the human skin; (2) the treatment of dry skin; (3) as a skin
cleanser; (4) as a hair conditioner; (5) as a shampoo; or (b) cosmetic
and dermatologic preparations containing glycolic acid and/or its salts, in
combination with salicylic acid for the treatment of acne; or (c) cosmetic
and dermatologic preparations containing glycolic acid and/or its salts in
combination with two percent (2%) or less of hydroquinone for the treatment of
pigmented spots on human skin.

 

2.05
“Territory” shall mean all countries and territories of the world.

 

2.06
An “Affiliate” of LICENSE shall mean (a) subject to the provisions of Section 3.04
below, any wholly owned entities of LICENSEE listed on Schedule B hereto,
as said Schedule B shall from time to time be updated promptly by
LICENSEE; and (b) subject to the provisions of Section 6.02 hereof,
any person, corporation, partnership or other entity which directly or
indirectly controls, is controlled by, or in under common control with
LICENSEE. Affiliates of LICENSEE shall be subject to all of the provisions of
this Agreement.

 

2.07
An “Affiliate” of LICENSOR shall mean any person, corporation, partnership or
other entity which directly or indirectly controls, is controlled by, or is
under

 

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common control with,
LICENSOR.

 

ARTICLE III
- LICENSE GRANT

 

3.01
Subject to all of the terms and provisions of this Agreement, LICENSOR grants
to LICENSEE and Affiliates of LICENSEE (as defined in Section 2.06) under
the Licensed Patent Rights a non-exclusive license to make, have made, use,
sell, and distribute in the Territory Licensed Products except through the
Excluded Channel of Trade.

 

3.02
Notwithstanding any provision herein to the contrary, no right is granted or
otherwise conveyed by this license agreement to any entity other than LICENSEE
and, to the extent provided in Schedule B to this Agreement as said Schedule B
may be updated from time to time, the Affiliates of LICENSEE, to make, have
made, use, sell or otherwise dispose of Licensed Products, except for resale or
use by customers of LICENSEE and its Affiliates.

 

3.03
Licensed Products of LICENSEE and its Affiliates are currently sold and/or
distributed in the Territory under the brand names and/or trademarks (the “Licensee
Marks”) listed on Schedule C hereto. Schedule C hereto will be
promptly updated by LICENSEE should LICENSEE, make, have made, use, distribute
or sell Licensed Products other than under the Licensee Marks listed on Schedule C.

 

3.04
As a condition to receiving the license under the Licensed Patent Rights
hereunder, each Affiliate of LICENSEE must first execute and deliver to LICENSOR
a written instrument in the form provided in Exhibit A hereto pursuant to
which such Affiliate of LICENSEE agrees with LICENSOR to be bound by all of the
terms and provisions of this Agreement applicable to LICENSEE. LICENSEE hereby
unconditionally guarantees the compliance and performance by each Affiliate of
LICENSEE with and of all of the provisions of this Agreement, including,
without limitation, the payments of all amounts due to LICENSOR pursuant to any
of the provisions of this Agreement.

 

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3.05
The term of this Agreement and of the license granted hereunder shall commence
as of the Effective Date and shall expire or terminate upon the expiration of
the last to expire of the Licensed Patent Rights or upon the earlier
termination of this Agreement pursuant to any of the provisions of Article VII
of this Agreement.

 

3.06
Subject to Section 8.03 hereof, LICENSOR specifically reserves the right
to, and to grant licenses to others to, make, have made, use, sell or otherwise
dispose of Licensed Products within or without the Territory on such terms as
LICENSOR may deem appropriate.

 

3.07
During the term of this Agreement, LICENSEE and its Affiliates shall not be
obligated to pay more than one royalty with respect to the same unit of
Licensed Product regardless of the number of claims of the Licensed Patent
Rights covering said Licensed Product. However, no license, express or implied,
is granted hereunder to any other patent rights or under any other patents or
technology owned, used, or otherwise controlled by LICENSOR or any Affiliate of
LICENSOR, other than under the Licensed Patent Rights.

 

ARTICLE IV
- PAYMENTS, ROYALTIES AND REPORTS

 

4.01
In consideration for the licenses granted to LICENSEE hereunder, LICENSEE and
permitted Affiliates of LICENSEE shall pay to LICENSOR in the manner set forth
below, payable quarterly, royalties on the annual Net Sales of Licensed
Products made during such quarter by LICENSEE or Affiliates according to the
following schedule:

 

(a) ***
of Net Sales between *** and ***;

 

(b) ***
of Net Sales between *** and *** plus;

 

(c) ***
of Net Sales between *** and ***; and

 

(d) ***
of Net Sales in excess of *** .

 

***PORTIONS OF THIS PAGE
HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

 

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4.02
LICENSOR and LICENSEE agree that the methodology used to calculate the payments
and royalties set forth herein is fair, reasonable and the most
administratively convenient way to make the calculations.

 

4.03
Notwithstanding the schedule set forth in Section 4.01 above, in
consideration of the license granted to LICENSEE hereunder, LICENSEE will pay
to LICENSOR a minimum annual royalty of ***, to be paid in equal amounts on a quarterly
basis, on July 1, October 1, January 1, and April 1 of each
calendar year, commencing on July 1, 1999. The minimum annual royalty
payment shall increase *** each year over the preceding year’s minimum annual
royalty payment during the term of this Agreement until such time as the
minimum annual payment reaches ***. Upon reaching *** the minimum annual
payment shall remain at that amount for each subsequent year during the term of
this Agreement. Such minimum annual royalty payments are creditable against the
royalty from LICENSEE’s sale of Licensed Products for the same years.

 

4.04
For purposes of this Agreement, “Net Sales” shall mean the gross amounts
received by LICENSEE or an Affiliate of LICENSEE from or on account of the sale
of Licensed Products to independent third parties, less the aggregate of the
following amounts: (i) discounts, including cash discounts, or rebates
actually allowed or granted, and (ii) credits or allowances actually
granted by LICENSEE or an Affiliate of LICENSEE upon claims or returns. All
royalties due to LICENSOR under this agreement shall be based upon the sales
price of the Licensed Products sold hereunder to an unaffiliated third-party.
Sales are considered made for the purposes of this Agreement when invoiced by LICENSEE
or an Affiliate of LICENSEE.

 

4.05
During the term of this Agreement as specified in Section 3.05, LICENSEE
shall, and shall cause its Affiliates to, maintain complete and accurate
records of all sales of Licensed Products and all payments due to LICENSOR
hereunder. LICENSEE shall deliver to LICENSOR within sixty (60) days after the
close of each

 

***PORTIONS OF THIS PAGE
HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

 

7

 

calendar quarter, a true
and accurate written report, certified as true and correct by an officer of
LICENSEE, setting forth the gross dollar amounts received by LICENSEE and
Affiliates of LICENSEE for the sales of Licensed Products; the calculation of
Net Sales (including a separate statement of the amounts deducted pursuant to
clauses (i) and (ii) of Section 4.04 to determine Net Sales);
and the computation of the royalties to be paid to LICENSOR by LICENSEE and
Affiliates of LICENSEE for such period. Each such report shall segregate the
gross and net dollar sales amounts separately for LICENSEE and each Affiliate
of LICENSEE.

 

4.06
Simultaneously with providing the report required in Section 4.05, LICENSEE
shall pay to LICENSOR in United States Dollars the entire amount of royalties
due to LICENSOR for the calendar quarter on account of which such report is
made and submitted.

 

4.07
LICENSOR shall have the right, at its own expense, to request an audit of any
quarterly period ending not more than three (3) years prior to the date of
such request, and to appoint an independent accountant to perform such audit.
The independent accountant appointed by LICENSOR shall have access to the
business records of LICENSEE and Affiliates of LICENSEE which are necessary or
appropriate to verify the royalties payable to LICENSOR pursuant to this
Agreement. The independent accountant shall keep confidential information
received from LICENSEE or its Affiliates, except for information necessary for
disclosure to LICENSOR to report on the accuracy of LICENSEE’S reports. In the
event that a deficiency of four percent (4%) or more is discovered between the
actual royalty payment due to LICENSOR and the amount of the royalty payment
specified in the written report submitted by LICENSEE to LICENSOR pursuant to Section 4.05,
LICENSEE shall bear the costs of the audit conducted by LICENSOR.

 

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4.08
No amounts due hereunder shall be withheld by LICENSEE or Affiliates of
LICENSEE, whether due to a claim of set-off or any other claim by LICENSEE of
any amount due to LICENSEE from LICENSOR, except for a specific amount withheld by LICENSEE or
an Affiliate due to a claimed breach of a specific provisions of this
Agreement. Any withholding of any such specific amounts by LICENSEE or an
Affiliate shall require a notice from LICENSEE, in advance of the date the
amount would otherwise be due, stating: (a) the amount withheld; (b) a
specific statement of the breach(es) of this Agreement claimed by LICENSEE or
an Affiliate; and (c) the specific provisions(s) of this Agreement for
which the breach(es) is/are claimed.

 

ARTICLE V
- REPRESENTATIONS AND WARRANTIES; LIMITATIONS

 

5.01
LICENSOR represents that it has the full authority to grant to LICENSEE the
rights with respect to the Licensed Patent Rights in accordance with the
provisions of this Agreement.

 

5.02
LICENSOR MAKES NO REPRESENTATIONS TO LICENSEE, EXTENDS NO WARRANTIES OF ANY
NATURE, WRITTEN OR ORAL, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY
IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AND
HEREBY DISCLAIMS ANY AND ALL WARRANTIES, AND LICENSOR ASSUMES NO LIABILITIES OR
RESPONSIBILITIES OF ANY NATURE WHATSOEVER WITH RESPECT TO THE MANUFACTURE,
DISTRIBUTION, SALE, USE OR OTHER DISPOSITION BY LICENSEE OR ANY AFFILIATE OF
LICENSEE, OR ANY VENDEE OR OTHER TRANSFEREE OR USER OF ANY OF THE LICENSED
PRODUCTS OR OTHER PRODUCTS WHICH INCORPORATE, OR ARE FORMULATED OR MANUFACTURED
BY USE OF, ANY OF THE LICENSED PATENT RIGHTS OR ANY OTHER INFORMATION FURNISHED
BY OR IN CONNECTION WITH THIS AGREEMENT.

 

5.03
LICENSOR MAKES NO REPRESENTATION OR WARRANTY AND IN NO EVENT SHALL LICENSOR OR
ANY AFFILIATE OF LICENSOR BE

 

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LIABLE
OR RESPONSIBLE TO LICENSEE FOR ANY INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES.

 

5.04
Without limiting the disclaimers set forth in Sections 5.02 and 5.03, nothing
in this Agreement shall be construed as:

 

(a) a
warranty or representation by LICENSOR as to the validity or scope of any
patent included within the Licensed Patent Rights;

 

(b) a
warranty or representation by LICENSOR that anything made, used or sold or
otherwise disposed of by LICENSEE under this Agreement is or will be free from
infringement of patents of third persons;

 

(c) a
requirement or obligation that LICENSOR furnish to LICENSEE any technical or
manufacturing information concerning Licensed Products, or any of the substance
of pending patent applications other than those included in the Licensed Patent
Rights;

 

(d) a
grant by LICENSOR of any right to use in advertising, publicity, or otherwise a
trademark, trade name or image and likeness of LICENSOR or its Affiliates, or
any name or likeness of their respective employees, officers, or the inventors
of any of the patents or patent applications included within the Licensed
Patent Rights;

 

(e) a
representation or warranty by LICENSOR as to the usefulness, fitness,
merchantability or suitability of any product to be manufactured sold or
otherwise distributed by LICENSEE or any Affiliate of LICENSEE.

 

ARTICLE VI
- TRANSFERABILITY OF RIGHTS AND OBLIGATIONS

 

6.01
This Agreement shall be binding upon any successor or assign of LICENSOR. LICENSOR
may assign any of its rights and obligations hereunder, in whole or in part,
without the prior written consent of LICENSEE.

 

6.02
LICENSEE may not assign its rights and obligations under this Agreement to a
third-party without the prior approval of LICENSOR, which approval shall

 

10

 

be requested by LICENSEE
in the manner provided in Section 13.01 hereof. In any event, assignment
of LICENSEE’s rights and obligations hereunder is effective only upon a writing
executed by LICENSEE’s permitted assignee in accordance with Section 3.04
hereof. LICENSOR shall respond to LICENSEE’S written request for approval of
assignment of this Agreement within thirty (30) days of receipt of LICENSEE’S
request for approval. In the event LICENSOR does not respond to such request
within such thirty (30) day period, LICENSOR will be deemed to have consented
to the assignment requested in LICENSEE’S notice provided the assignee executes
the writing in accordance with Section 3.04 hereof. LICENSOR’s consent to
an assignment under this Section 6.02 will not be unreasonably withheld;
however LICENSOR may reasonably withhold its consent only if it reasonably
believes that the proposed assignee does not possess sufficient financial or legal
ability to perform any of the terms of this Agreement, is lacking in any other
such capacity necessary to perform the terms of this Agreement, or is engaged
after any notice from LICENSOR in activities that infringe any patent rights of
LICENSOR. Any attempt to transfer, assign or sublicense not in accordance with
the terms of this Agreement shall be void.

 

6.03
The provisions of this Agreement shall be binding upon and inure to the benefit
of all successors and permitted assigns of the parties hereto.

 

ARTICLE VII
- TERMINATION FOR BREACH

 

7.01
Prior to the expiration of the term of this Agreement, LICENSOR may, at its
option, terminate this Agreement and the license granted hereunder if LICENSEE
or an Affiliate fails to pay within thirty (30) days of the date of receipt of
notice from LICENSOR of a failure to pay any amount required to be paid
hereunder, where LICENSEE’S failure to pay is the first such failure in a
calendar year. For any additional failure(s) to pay in any calendar year after
the first failure to pay, LICENSOR may, at its option, terminate this Agreement
and the license granted hereunder if LICENSEE or an Affiliate fails to pay
within fifteen (15) days of the date of receipt of notice from LICENSOR of such
failure to pay any amount required to be paid hereunder. For a breach of any

 

11

 

other provision of this
Agreement other than for failure to pay amounts due hereunder, unless the
breach is not capable of being cured, LICENSEE shall have sixty (60) days from
receipt of notice from LICENSOR to cure such other breach and thereby avoid
termination under this Section. If the breach is not capable of being cured,
any overdue amount is not paid with interest at the rate of one percent (1%) per
month during the period for which such amount is overdue to the date paid, or
such other breach is not cured within sixty (60) days, then this Agreement and
all licenses granted hereby will terminate immediately and automatically
without any further notice or action on the part of LICENSOR. In the event that
the interest rate specified in this Section exceeds the maximum rate of interest
permitted by applicable law, such rate shall in such instance be reduced to the
maximum permitted rate.

 

7.02
In the event that LICENSEE or any permitted assignee of LICENSEE shall become
insolvent, be declared bankrupt, voluntarily file or have filed against it a
petition for bankruptcy or reorganization, unless such petition is dismissed
within sixty (60) days of filing, enter into an arrangement for the benefit of
creditors, enter into a procedure of winding up to dissolution or should a
trustee or receiver be appointed for its respective business assets or
operations, LICENSOR may immediately terminate this Agreement and the license
granted hereby, effective upon written notice to LICENSEE.

 

7.03
LICENSEE may terminate this Agreement at any time upon six (6) months
prior written notice to LICENSOR, provided that upon the effective date of such
termination LICENSEE shall make no further sales of products that infringe the
Licensed Patent Rights.

 

7.04
Under no circumstances (including, without limitation, a termination for any
reason whatsoever) shall LICENSOR be obligated to refund any payments
theretofore made by LICENSEE hereunder, unless it is established to the
reasonable satisfaction of LICENSOR that the payment was erroneously made at
the time of payment.

 

12

 

7.05
Except as otherwise specifically provided herein, expiration or termination of
this Agreement and of the license granted hereby for any reason shall be
without prejudice to:

 

(a) the
right of LICENSOR to receive all payments accrued and unpaid as of the
effective date of such termination or to receive any payments or other amounts
which may accrue after the date of termination; and

 

(b) any
other rights, remedies or obligations which LICENSOR may then or thereafter
have under this Agreement or otherwise.

 

7.06
Except for a termination as provided in Section 7.03, upon the termination
(but not expiration) of this Agreement, LICENSEE and its Affiliates shall cease
all use of the Licensed Patent Rights. Notwithstanding the foregoing, LICENSEE
and its Affiliates shall for a period of ninety (90) days following the effective
date of termination be entitled to distribute and sell within the Territory
through their regular channels of distribution any stocks of completed Licensed
Products then in their possession, subject to the payment of royalties and
other provisions of Section 4 of this Agreement.

 

7.07
The provisions of sections 7.03 through this Section 7.07 shall survive
termination or expiration of this Agreement.

 

ARTICLE VIII
- THIRD-PARTY INFRINGEMENT

 

8.01
LICENSOR shall have the sole right, but not the obligation, to institute and
control the prosecution of a suit or to take any other action for infringement
of any of the Licensed Patent Rights. LICENSEE agrees to take no action with
respect to any third-party infringement of Licensed Patent Rights unless expressly
authorized to do so in writing by LICENSOR. LICENSEE agrees to, and to cause
each of the Affiliates of LICENSEE, to provide reasonable cooperation to
cooperate with LICENSOR in connection with a suit or other action for
infringement of the Licensed Patent Rights upon LICENSOR’s request. LICENSOR
will provide reasonable compensation to LICENSEE

 

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and its Affiliates for
expenses incurred in connection with such cooperation. Any recovery or
settlement obtained as a result of such suit or other action shall be retained
by LICENSOR for its own use and benefit, and LICENSEE shall have no rights
whatsoever in any such recovery or settlement.

 

8.02
Neither LICENSEE nor any Affiliate shall foster or encourage any infringement
of the Licensed Patent Rights by any third-party. If LICENSEE and/or any of its
Affiliates shall engage in such conduct, LICENSOR shall have the right to deem
such conduct a material breach of this Agreement, which breach shall be a basis
of termination of this Agreement and of the license granted herein, pursuant to
Section 7.01 of this Agreement.

 

8.03
LICENSOR will use reasonable efforts to enforce the Licensed Patent Rights
hereunder against infringement by third-parties in such manner as LICENSOR
deems necessary and appropriate in light of all the circumstances. LICENSOR
also agrees to use reasonable efforts to license the Licensed Patent Rights
hereunder to third-parties on reasonable royalty terms. Notwithstanding
anything in this Section 8.03 to the contrary, LICENSOR reserves the right
to license the Licensed Patent Rights to others on terms it reasonably deems to
be commercially reasonable and nothing contained herein shall be construed as
an obligation on the part of LICENSOR to take any particular actions respecting
third-party infringement and nothing contained herein shall be construed as an
obligation on the part of LICENSOR to license the Licensed Patent Rights to
third-parties on any particular terms or conditions.

 

ARTICLE IX
- NOTIFICATION OF INQUIRY FROM

THIRD-PARTIES CONCERNING LICENSED PATENT RIGHTS

 

9.01
Except as provided in Section 12.02, LICENSEE agrees to, and to cause
Affiliates of LICENSEE to, respond to any request for disclosure or information
concerning the Licensed Patent Rights hereunder only by notifying LICENSOR
promptly of the request for disclosure and the identity of the person or entity
making such request for disclosure so that LICENSOR can respond to the request.

 

14

 

ARTICLE X
- INTEGRATION; AMENDMENT

 

10.01
This Agreement represents the entire understanding between the parties, and
supersedes all prior or contemporaneous discussions, proposals, negotiations,
understandings and other agreements, express or implied, between LICENSOR and
LICENSEE with respect to the subject matter of this Agreement, and there are no
representations, promises, conditions, provisions or terms, whether written or
oral, with respect thereto, other than those specifically set forth in this
Agreement.

 

10.02
No provision in this Agreement may be amended, altered, modified, discharged or
terminated, except by a writing signed by a duly authorized representative of
LICENSOR and LICENSEE.

 

ARTICLE XI
- INDEMNIFICATION

 

11.01
LICENSEE and Affiliates of LICENSEE operating under this Agreement pursuant to
Section 3.04 hereof shall jointly and severally defend, indemnify and hold
harmless LICENSOR and the Affiliates of LICENSOR, and the officers, agents and
employees of LICENSOR and its Affiliates, and the inventors (collectively the
"Indemnified Parties") from and against any and all liabilities,
damages, losses, claims, suits, proceedings, demands, recovery, costs and
expenses (including, without limitation, the fees and expenses of counsel, litigation
expenses, and court costs) which arise out of or relate to, or are alleged to
arise out of or relate to: any personal injury, death or property damage which
arise out of or relate to or are alleged to arise out of or relate to the
manufacture, distribution, sale or use of products manufactured, sold or
otherwise distributed by LICENSEE or any Affiliate of LICENSEE.

 

11.02
During the term of this Agreement and for such later term extending beyond the
term of this Agreement as LICENSEE or any Affiliate of LICENSEE may be selling
Licensed Products and for a period of two (2) years after the expiration of the
shelf-life of the last of the Licensed Products sold by LICENSEE or any
Affiliate of LICENSEE, LICENSEE shall maintain: (1) all insurance and/or bonds
required by law;

 

15

 

and (2) comprehensive
general liability insurance, including product liability insurance, subject to
the availability of such product liability insurance at commercially reasonable
rates, written on an occurrence basis at the levels currently maintained by
Herald *** base policy and *** excess coverage) for bodily injury, including
death and property damage. Such amounts shall be subject to reasonable
increases upon the fifth and tenth anniversaries of the date hereof to account
for inflation and other relevant factors, subject to the availability of such
insurance at commercially reasonable rates. Subject to the availability at
commercially reasonable rates, the insurance coverage required by this Section 11.02
shall be provided with respect to all claims for damages to person or property
arising out of the manufacture, formulation, processing, fabrication, sale or
use of any of the Licensed Products, regardless of when such claims are made or
when the underlying damages or injuries occur or manifest themselves. Subject
to the availability at commercially reasonable rates, the policies of insurance
shall: (a) include an endorsement naming LICENSOR and its Affiliates and
their respective officers, employees and agents as additional named insureds;
and (b) provide that notice be given to LICENSOR not less than thirty (30)
days prior to any cancellation or material change in any of such policies.

 

11.03
The indemnity and insurance obligations of LICENSEE and the Affiliates of
LICENSEE under this Agreement shall survive the termination or expiration of
this Agreement and of the licenses granted pursuant to this Agreement in order
to indemnify and hold harmless the indemnified Parties (as defined in Section 11.01)
with respect to any claims for which the indemnified Parties are entitled to
indemnification, irrespective of whether any such claim arose prior or
subsequent to the effective date of termination or expiration.

 

ARTICLE XII
- PRESS RELEASES AND PUBLICITY

 

12.01
Neither LICENSOR nor LICENSEE shall issue a press release or public
announcement disclosing the terms of this Agreement without the prior specific
written consent of the other party. LICENSOR and LICENSEE may disclose the fact
that

 

***PORTIONS OF THIS PAGE
HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

 

16

 

this Agreement has been
executed and entered into without disclosing the amount of the payments
hereunder or any of the other terms of this Agreement.

 

12.02
Notwithstanding Section 12.01, LICENSOR or LICENSEE may disclose the terms
of this Agreement in response to: (a) an order from a court or
governmental agency; (b) in response to a request by a party in
litigation, provided an appropriate protective order has been entered; (c) in
response to a request to LICENSOR from a licensee or prospective licensee or a
request to LICENSEE from a bona fide party considering purchasing substantially
all of the assets of LICENSEE or considering some other form of acquisition
transaction or financing, provided that an appropriate non-disclosure agreement
has been executed; or (d) if such disclosure is necessary to comply with
any other laws or regulations applicable to LICENSOR or LICENSEE.

 

ARTICLE XIII
- NOTICES

 

13.01
It will be a sufficient giving of any notice, request, report, statement,
disclosure, or other communication hereunder; to LICENSOR or to LICENSEE, if
the party giving it deposits a copy thereof in a post office in a registered or
certified envelope, postage prepaid, or with overnight courier, prepaid,
receipt requested, addressed to the other party at its address set forth below
or at any other address the other party may hereafter designate in writing in
accordance with the provisions hereof. Unless otherwise specified in this
Agreement or otherwise designated in writing, payments to be made pursuant to
any of the provisions of this Agreement will be transmitted to the address to
which notice is to be given hereunder, or wired to the bank account of LICENSOR
as requested by LICENSOR. The respective addresses for the parties are:

 

	
  If to LICENSEE:

  	
  MDF Acquisition Corp.

  
	
   

  	
  10455 Pacific Center
  Court

  
	
   

  	
  San Diego, CA 92121

  
	
   

  	
  Attention: President

  

 

17

 

	
  If to LICENSOR:

  	
  TRISTRATA TECHNOLOGY

  INCORPORATED

  1105 North Market Street

  Suite 1300, P.O. Box 8985

  Wilmington, Delaware 99899

  
	
   

  	
   

  
	
   

  	
  Attention: President

  

 

Notice to LICENSEE shall
be deemed notice to each Affiliate of LICENSEE for all purposes, and LICENSOR
shall not be required to give any separate notice to any Affiliate of LICENSEE.

 

ARTICLE XIV
- APPLICABLE LAW AND JURISDICTION

 

14.01
All matters affecting the interpretation validity, and performance of this
Agreement shall be governed by the laws of the State of Delaware without regard
to its conflict of law principles.

 

14.02
The United States District Court for the District of Delaware, if a basis for
Federal court jurisdiction is present, and otherwise a state court of the State
of Delaware, shall have exclusive jurisdiction and venue over any dispute
arising under or relating to this Agreement, and LICENSEE and the Affiliates of
LICENSEE consent to the jurisdiction and venue of such courts. Each of LICENSOR
and LICENSEE and Affiliates of LICENSEE submits to the personal jurisdiction in
the State of Delaware in any action or proceeding arising under or relating to
this Agreement and hereby agrees not to assert by way of pleading, motion or
otherwise in any such suit; action of proceeding, that such party is not
personally subject to the jurisdiction of any such court and such action or
proceeding is brought in an inconvenient forum, that the venue of the suit,
action or proceeding is improper or that this Agreement may not be enforced in
or by such court. In furtherance of such submission to jurisdiction, each of
LICENSOR and LICENSEE and Affiliates of LICENSEE hereby agrees that, without in
any manner limiting or restricting other methods of obtaining personal
jurisdiction over such party, personal jurisdiction over

 

18

 

LICENSOR or LICENSEE in
any action or proceeding arising out of or relating to this Agreement may be
obtained over such party within or without the jurisdiction of any court
located in the State of Delaware (including a United States Federal District
Court in such state) and that any process, notice of motion, or other
application to any court in connection with any such action or proceeding may
be served upon such party by registered or certified mail to, or by personal
service upon such party at the last address of such party as specified in, or
in accordance with the provisions of, Article XIII of this Agreement.

 

Each of the Affiliates of
LICENSEE and LICENSOR shall be bound by the provisions of this Section 14.02.

 

14.03
In any action commenced to enforce this Agreement or as a result of a breach of
this Agreement, the prevailing party in such action shall be entitled to
recover the costs of such action, including attorneys’ fees, incurred as a
result of the action to enforce and/or remedy the breach of this Agreement.

 

ARTICLE XV
– MISCELLANEOUS

 

15.01
(a) If any provision of this Agreement or the application of any provision
of this agreement to any person or under any circumstance shall be held to be
invalid, unenforceable or in conflict with the law of any jurisdiction, the
validity and enforceability of the remaining provisions and the application
thereof to any another person or under any other circumstance shall not be
affected by such holding.

 

(b) Any provision of
this Agreement which is held to be invalid or unenforceable by a court of
competent jurisdiction in any jurisdiction shall, as to such jurisdiction, be
ineffective only to the extent of such invalidity or unenforceability.

 

15.02 The
waiver by either party, whether express or implied, of any provision of this
Agreement, or of any breach or default by the other party shall not be
construed to be a continuing waiver of such provision or of any succeeding
breach or default, or a waiver of any other provision of this Agreement.

 

19

 

15.03   Nothing
contained in this Agreement shall be construed to constitute or imply a joint
venture, partnership, or principal-agent relationship between LICENSOR and
LICENSEE. Neither party by virtue of this Agreement shall have any right, power
or authority to act or create any obligation, express or implied, on behalf of
the other party. Neither LICENSEE, nor any Affiliate of LICENSEE, nor any of
the employees of LICENSEE or of any Affiliate of LICENSEE shall in any manner
be deemed an employee or an agent of LICENSOR for any purpose whatsoever.

 

15.04   The
provisions of this Agreement are solely for the benefit of LICENSOR and
LICENSEE, their authorized Affiliate, and their permitted successors and
assigns (as defined herein), and no such provision shall be construed or
applied to confer any rights or benefits on any other person.

 

15.05   This
Agreement may be simultaneously executed in several counterparts, each of which
shall be an original and all of which shall constitute but one and the same
instrument. Both parties hereto may sign the same counterpart or each party
hereto may sign a separate counterpart of this Agreement.

 

15.06   Article,
section and paragraph headings in this Agreement are for reference purposes
only and shall not in any way affect the construction or interpretation of any
provision of this Agreement.

 

IN WITNESS WHEREOF, the
parties have duly executed this Agreement as of the date first written above.

 

	
  LICENSOR

  	
  LICENSEE

  
	
  TRISTRATA TECHNOLOGY, INC.

  	
  MDF ACQUISITION CORP.

  
	
   

  	
   

  
	
  By

  	
  /s/ Stephen J. VanScott

  	
   

  	
  By

  	
  /s/ [ILLEGIBLE]

  	
   

  
	
   

  	
  Stephen J. VanScott,
  President

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title

  	
  President

  	
   

  	
  Title 

  	
  C.E.O.

  	
   

  
	
   

  	
   

  
	
  Dated 

  	
         July 20,
  1999

  	
   

  	
  Dated 

  	
         July 15,
  1999

  	
   

  
	
   

  	
   

  
	
  Attest 

  	
  /s/ Ann E. VanScott

  	
   

  	
  Attest 

  	
  /s/ Judi Atienza

  	
   

  
	
  Ann E. VanScott,
  Assistant Treasurer

  	
  Judi Atienza

  
									

 

20

 

EXHIBIT A

 

The undersigned agrees to
be bound by all of the provisions of the License Agreement between MDF
Acquisition Corp. and TriStrata Technology, Inc. dated July 1, 1999.

 

 

LICENSE
AGREEMENT

 

THIS AGREEMENT, made, entered and effective as
of the 1st day of April, 1994 (the “Effective Date”) by and among Avon Products, Inc.,
9 West, 57 Street, New York, New York 10019, Avon Canada Inc., 5500
Trans-Canada Highway, Pointe-Claire, Quebec H9R 4R3, Cosmeticos Avon, S.A., a
corporation organized and existing under the laws of Chile, Cosmeticos Avon,
S.A., a corporation organized and existing under the laws of Argentina, and
Avon Cosmetics, S.A. de C.V., Ave. Universidad No. 1778, Col. Oxtopulco,
Mexico 04318, D.F. (collectively hereinafter referred to as “AVON”) and
TriStrata Technology, Inc., 1105 North Market Street, Suite 1300, P.O. Box
8985, Wilmington, Delaware 19899 (hereinafter referred to as “LICENSOR”) and
NeoStrata Company, Inc., 4 Research Way, Princeton, New Jersey 08540 (“NeoStrata”)
and PolyStrata Pharmaceuticals, Inc., 4 Research way, Princeton, New
Jersey 08540 (“PolyStrata”), to effect the buy out and cancellation of AVON’S
royalty obligation and superseding, to the extent set forth herein, the License
Agreement between Avon and NeoStrata company, Inc., dated November 1,
1990 (the “U.S. License”) and all foreign license agreements between Avon,
NeoStrata, PolyStrata and/or their foreign affiliates (the “Foreign Licenses”)
The U.S. License and the Foreign Licenses are hereinafter collectively referred
to as the “Prior Licenses”.

 

WITNESSETH:

 

WHEREAS, AVON in the
course of its business sells cosmetic products, and is interested in obtaining
a license for glycolic acid products under the Patent Rights and Know-How
related thereto (as hereinafter defined); and

 

WHEREAS, LICENSOR is
willing to grant AVON and its sales representatives and customers certain
rights to glycolic acid products under the Patent Rights and Know-How defined
in this Agreement according to the specific provisions and restrictions
hereinafter provided for and the mutual undertakings hereinafter expressed, and
for other good and valuable consideration.

 

NOW, THEREFORE, in
consideration of the mutual covenants, promises and agreements herein contained
and made to be performed by the parties, it is mutually agreed as follows:

 

 

ARTICLE I

 

DEFINITIONS

 

As used in this
Agreement:

 

1.1                    “Patent Rights”
shall mean that portion of patents and patents pending, listed in Appendices I
and II as set forth in each Prior
License as amended hereby and all present foreign counterparts thereof (to the
extent not included in Appendix I or II) and all issued divisions,
continuations, continuations-in-part, reissues and extensions thereof covering
the use of glycolic acid and/or its salt, or in combination with hydroquinone,
and which may be useful for topical treatment of age spots, wrinkles, nails
(which shall be limited to the territory of the United States), pigmentation
changes and/or the skin changes associated with aging. Without further due
diligence LICENSOR has communicated in good faith the updated Appendices I and
II and accordingly to the best of its knowledge said Appendices I and II
attached hereto are accurate as of this date.

 

1.2                    “Licensed
Products” shall mean cosmetic and/or dermatologic preparations containing
glycolic acid and/or its salt, or in combination with hydroquinane for topical
application to improve the appearance of age spots, wrinkles, nails (which
shall be limited to the territory of the United States), pigmentation changes
and/or the skin changes associated with aging, excluding preparations
containing glycolic acid and or/its salt for other indications and excluding
the preparations as prescription drug(s) as presently defined on the Effective
Date; it being understood no expansion of rights to Licensed Products beyond
the rights set forth in the Prior Licenses is hereby granted.

 

1.3                    “Know-How”
shall mean all technical information and trade secrets disclosed to AVON and/or
its affiliates and which is useful for the formulation, manufacture,
fabrication, processing and use of the Licensed Product which is in AVON’s
possession prior to the Effective Date, and which LICENSOR has disclosed to
AVON without violating any obligation to any third party, but excluding
information which has been, is now or becomes part of the public domain; it
being understood no expansion of rights to Know-How beyond the rights set forth
in the Prior Licenses is hereby granted.

 

1.4                    “AVON’s Trade
of Business” shall mean AVON’S method or channel of distribution and/or
marketing in the Territory through (1) mail order or direct marketing of
AVON’S products by its sales representative to consumers or (2) through
Avon Boutiques making retail sales to consumers which are either (i) wholly-owned
by AVON so long as gross annual sales of Licensed

 

 

Products in all such Avon
Boutiques in each such country never equal or exceed twenty percent (20%) or
more of AVON’s aggregate annual sales of Licensed Products in each such country
or (ii) franchise-owned by AVON in the Philippines with sales limited to
consumers in the Philippines. Notwithstanding anything in this Agreement AVON’s
Trade of Business also shall be restricted by and conform with the terms of the
August 5,1992 settlement
agreement between Avon Canada Inc., NeoStrata and Canderm Pharmacal Ltd.
including the exhibits thereto (the “Canada Settlement Agreement”).

 

1.5                    “Territory”
shall mean:

 

(1)                     United States
(which shall be the only territory in which Licensed Products for nails may be
sold or distributed);

 

(2)                     Great
Britain, Ireland, France, Germany, Italy, Spain, Austria, Portugal, Hungary,
Switzerland, the Czech Republic and Slovakia, Belgium, the Netherlands, Luxembourg,
Russia and other countries independent from the former USSR;

 

(3)                     Australia,
China, Indonesia, Malaysia, New Zealand, Philippines, Singapore, Taiwan, Japan,
Thailand, Korea, Hong Kong;

 

(4)                     Canada (as
restricted by the terms of the Canada Settlement Agreement);

 

(5)                     Mexico;

 

(6)                     Argentina;

 

(7)                     Chile;

 

(8)                     Peru*;

 

(9)                     Guatemala*;

 

(10)               Ecuador*;

 

(11)               Brazil*;

 

(12)               Venezuela*;

 

(13)               India*;

 

(14)               Vietnam*; and

 

(15)               South Africa*.

 

*
See section l.6 below.

 

3

 

1.6       “Countries”
shall mean the countries set forth in subsections 1.5 (1) – (7) and
individually shall be referred to as a “Country”. “Asterisked Countries”, shall
mean the countries set forth in subsections l.5 (8) – (15) and
individually shall be referred to as an “Asterisked Country”.

 

ARTICLE II

 

GRANT OF
LICENSE

 

2.1       LICENSE
GRANT: Subject to receipt by LICENSOR of the sum specified in Article III,
LICENSOR hereby grants to AVON and its sales representatives and customers an
exclusive, fully paid-up and, once all payments required to be paid under Section 3.1
and under the Prior Licenses have been paid, irrevocable license in the
Territory to make, have made, use and sell through AVON’s Trade of Business the
aforesaid Licensed Products under the Patent Rights and to use the Know-How
unless terminated as herein provided.

 

2.2       AVON
RIGHT TO SUBLICENSE: In each Country AVON shall have the right to sublicense as
provided in the Prior License applicable to such Country. In the Asterisked
Countries AVON shall have the right to sublicense any or all of rights granted to it under this Agreement
to (a) any of its subsidiary companies or (b) with the written
consent of LICENSOR, which shall not be unreasonably withheld, to any
affiliated company controlled by AVON to make, have made, use and sell through
AVON’s Trade of Business the Licensed Products in the Territory. AVON shall be
responsible to LICENSOR for the performance by any sublicensee(s) of the terms
and conditions of this Agreement and the Prior Licenses.

 

2.3       LICENSOR’S
RESERVATIONS AND MARKETING: LICENSOR specifically reserves Patent Rights and
Know-How to license and/or make, have made, use and sell Licensed Products
through all channels of distribution except for Avon’s Trade of Business. All
restrictions on NeoStrata’s and PolyStrata’s marketing and advertising set
forth in the Prior Licenses are hereby terminated as of the Effective Date
except only as follows:

 

LICENSOR agrees that
until February 28, 1995 it will not (a) directly engage in any
consumer advertising or promotion of the Licensed Products in the U.S. to the
public at large, or (b) other than with respect to parties with whom
LICENSOR has resolved a potential infringement litigation, allow by agreement
that consumer advertising or promotion of the Licensed Products be directed to
the public-at-large before such date.

 

4

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