License Agreement - Wired Ventures Ltd. and Dohosha Publishing Co. Ltd.
LICENSE AGREEMENT
THIS AGREEMENT, made this 30th day of May 1994 ("Effective Date")
between WIRED VENTURES, LTD., a California Limited Partnership, having its
principal place of business at 544 Second Street, Third Floor, San Francisco,
California, the United States of America 94107 ("Licensor") and DOHOSHA
PUBLISHING CO., LTD., a corporation organized and existing under the laws of
Japan, having its principal place of business at 2, Chudoji-Kagita-Cho,
Shimogyo-ku, Kyoto-shi, Kyoto, Japan ("Licensee").
WITNESSETH:
WHEREAS, WIRED USA, LTD. (an affiliate of Licensor) and Licensee
executed a Letter Agreement dated November 12, 1993; and
WHEREAS, Wired USA, Ltd. and WIRED HOLDINGS, INC. (an affiliate of
Licensor) subsequently transferred their license and ownership rights
respectively in the trademark "WIRED" to Licensor, including publication and
ownership rights for the trademark in Japan; and
WHEREAS, Licensor is engaged in the publication of a monthly magazine
entitled "WIRED", throughout the United States and the rest of the world;
WHEREAS, Licensee desires to be granted a license by Licensor to
publish the Licensed Products, as hereinafter defined, throughout the Territory,
as hereinafter defined, and Licensor is willing to grant the same to Licensee;
and
WHEREAS, Licensee desires to obtain the exclusive right as the licensee
of such Licensed Mark to use the same in any paper-based publication containing
editorial content and published and distributed in Japan and in any paper-based
Japanese language publication published and distributed anywhere in the world
and Licensor is willing to grant such right to Licensee provided such
publications are Licensed Products.
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties hereto agree as follows:
1. DEFINITIONS.
The following definitions shall be applicable throughout this
Agreement:
(a) "LICENSED PRODUCTS" shall mean (a) the Japanese Edition, as
hereinafter defined, and (b) any Paper Products, as hereinafter defined,
published and distributed in any language in Japan or Paper Products in the
Japanese language published and distributed anywhere in the world, either of
which have been added to the terms and conditions of this License Agreement
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by a Licensed Product Appendix to be executed separately by the parties hereto
substantially in the form attached hereto as Exhibit A ("Licensed Product
Appendix").
(b) "LICENSED MARK" shall mean the trademarks and service marks listed
on Exhibit B attached hereto.
(c) "JAPANESE EDITION" shall mean the magazine published in paper
format principally in the Japanese language, by Licensee in Japan, in which the
Licensed Mark is used on the cover and the principal focus of which is the
digital revolution and other technological, political and cultural issues
relating to the digital age.
(d) "PAPER PRODUCTS" shall mean any publication (other than the
Japanese Edition) containing editorial content and published on paper media
including, but not limited to, books, and magazines, in which the Licensed Mark
is used and for which the parties have executed a Licensed Product Appendix.
(e) "U.S. EDITION" shall mean WIRED Magazine as published by Licensor
in the United States of America.
(f) "MATERIAL(S)" shall mean all the editorial matters and materials
which appear and will appear in the U.S. Edition which Licensor has the ability
to make available to Licensee for use in the Licensed Products, including but
not limited to articles, pictures, photographs, illustrations, and
advertisements.
(g) "LICENSED TERRITORY" shall mean Japan and its territories and
possessions.
(h) "LAUNCH DATE" shall mean the date on which the Japanese Edition is
first made available for purchase by consumers in the Licensed Territory.
(i) "TERM" shall mean the period commencing on the Effective Date, and
ending on the last day of the initial or extended term of this Agreement, as set
forth in Section 17 hereof.
(j) "NET ADVERTISING REVENUES" shall mean the total amount obtained
from the sale of advertising pages in the Japanese Edition at the rate set forth
in the rate card for the Japanese Edition, as published from time to time by
Licensee, with deductions for commissions paid by Licensee to advertising
agencies and media buyers.
(k) "CIRCULATION REVENUES" shall mean (a) the total gross subscription
priced billed subscribers for all subscriptions to the Japanese Edition plus (b)
the cover price times the net number of copies of the Japanese Edition sold
other than by subscription. Returns of non-subscription copies shall be
considered in the computation of Circulation Revenues for the year in which such
returns were received by Licensee regardless of the year in which the returned
copies were sold.
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2. GRANT.
(a) Subject to the terms and conditions of this Agreement, Licensor
hereby grants to Licensee the exclusive right and license, during the Term, to
publish the Japanese Edition anywhere in the Licensed Territory. This exclusive
right includes the exclusive right during the Term to publish in the Japanese
Edition such Material and translations of Material as agreed upon the parties in
accordance with Section 4 below, and the right to include in the Japanese
Edition such other editorial materials ("Japanese Material") as it deems
appropriate and in accordance with Section 8.
(b) It is hereby agreed that Licensee has the right to sell the
Japanese Edition published in the Licensed Territory both inside and outside the
Licensed Territory.
(c) Licensor grants to Licensee the exclusive right and license, during
the Term, to use the Licensed Mark in connection with the publication of the
Japanese Edition, as provided for in Subsection 2 (a) above, and to use the
Licensed Mark in advertising, promotional, and display material in connection
with the sale thereof in accordance with Section 12.
(d) Licensor further grants to Licensee the exclusive right and
license, during the Term, to use the Licensed Mark in connection with any Paper
Product for which the parties have executed a Licensed Product Appendix. If the
parties are unable to agree to the specific terms of distribution for any Paper
Product, such Paper Product will not be included in this Agreement.
(e) Licensee shall not use the Licensed Mark for any purpose other than
those provided in this Section 2 and shall not use any variation of the Licensed
Mark or any other mark misleadingly similar to the Licensed Mark without a
separate written agreement with Licensor.
(f) Licensee shall not have the right to grant sublicenses of the
rights granted in this Section 2 without the prior written consent of Licensor.
3. RIGHT OF FIRST REFUSAL.
Licensee shall have the right of first refusal to license the use of
the trademark "WIRED" for goods and services other than the Licensed Products,
including conferences, optical disks, and television programming, in Japan
and/or in the Japanese language. The terms of such right of first refusal shall
be as follows:
Licensor may, from time to time, send a written proposal to Licensee
proposing that a specified product or service be distributed under the trademark
"WIRED" in Japan and/or in the Japanese language, which shall include a summary,
in reasonable detail, of the material terms and conditions for such proposed
distribution. Unless otherwise agreed to in writing, Licensee shall have a
one-time option to accept Licensor's proposal by notifying Licensor of such
acceptance in writing within ninety days of receiving Licensor's proposal. If
Licensee does not
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accept Licensor's proposal within such ninety (90) day period, Licensee's right
to obtain such license will expire and Licensor may distribute such product or
service itself or offer such license to another party on terms not materially
more favorable to such third party than those offered to Licensee. Unless
Licensee has accepted a proposal for such goods or services, Licensor shall
remain free to distribute goods and services other than Licensed Products under
the trademark "WIRED" in Japan or in the Japanese language.
4. MATERIALS CREATED OR ACQUIRED BY LICENSOR.
(a) Subject to Licensor's ability to secure rights for Japan, Licensee
may use in the Japanese Edition, at its discretion, any of the Materials in the
U.S. Edition.
(b) Licensee may use such Materials in the Japanese Edition on the
following basis:
(i) For Materials created directly by Licensor, such Materials
may be used in the Japanese Edition by Licensee free of charge, with no time
limit on such use and Licensee may alter the same to accommodate Japanese
culture and tastes, if necessary;
(ii) For Materials submitted to Licensor by independent
contractors, Licensor agrees to permit Licensee to use such Materials in the
Japanese Edition to the extent permitted by, and subject to the terms (including
payment of additional fees, translation rights, and restrictions on reprints) of
any applicable agreement between Licensor and the party submitting such
Materials. Licensee understands that this would typically entail a one-year
right of first refusal on Japanese publication in exchange for a payment by
Licensee to Licensor of a fee equal to * of the fee paid by Licensor in its
acquisition of rights to the Materials. Licensee may alter editorial Material to
accommodate Japanese culture and tastes only to the extent that Licensor is able
to grant any such right to modify the Material. Licensee agrees it shall have no
right to alter advertisements and artwork supplied by Licensor.
(iii) For material used in the U.S. Edition and obtained by
Licensor on a "one-time" use basis, Licensor agrees, if requested, to negotiate
on Licensee's behalf to obtain the right for Licensee to use such material in
the Japanese Edition as Material.
It is recognized, however, that for various reasons (including, but not
limited to, inability to obtain translation rights), material to be published in
the U.S. Edition will not always be made available for publication in the
Japanese Edition. Licensee shall take all steps required to preserve Licensor's
rights in Materials provided to Licensee, including, but not limited to,
inclusion of a correct and complete copyright and trademark notices (in the
manner designated or approved by Licensor as indicated in Exhibit C) in each
issue in which the Materials are published and credits for authors,
illustrators, photographers and other contributors. All Materials supplied by
Licensor shall be considered the property of Licensor or its suppliers. Licensor
reserves the right to refuse to provide Licensee with Materials, and to revoke
the right to publish Materials provided by Licensor to Licensee or any
transactions of such Materials, if Licensor is notified of a suit or claim
relating to such Materials, and Licensee agrees not to
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* Confidential Treatment Requested.
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publish such Materials or any transactions of such Materials after receipt of
such notice from Licensor.
(c) Licensee shall ensure that any translator of any Material agrees
that he or she will not have the right to use, reproduce, publish or otherwise
distribute translations of the Material without authorization from Licensor.
5. MATERIALS USE SCHEDULE; MANNER OF EDITING.
(a) Licensor shall provide Licensee with a summary or outline, together
with an index, of all editorial Materials, and the cover, of each issue of U.S.
Edition upon completion of production of such Materials. Such summaries,
outlines, indices and covers shall be electronically transmitted at no charge,
or if electronic transmission is not possible, shall be sent by courier of
Licensee's expense.
(b) Within seven (7) days of receipt of such index of Materials,
Licensee shall provide Licensor with a list of the Materials required for
publication in the Japanese Edition. Licensee and Licensor shall negotiate
publication rights in accordance with Section 4.
(c) Licensor shall, at Licensee's expense, deliver to Licensee the
Materials that are requested by Licensee pursuant to Subsection 5(b) above,
including the lay-out of each of such Materials in the form of low resolution
data, within two (2) weeks following the receipt of any such request.
(d) The parties will also negotiate publication rights for any
available images in accordance with Section 4. Licensor shall, at its License's
expense, deliver to Licensee each of the Materials in the form of high
resolution data on magneto optical disk once scanning is complete.
(e) Licensor shall, at its expense, deliver ten (10) copies of each
U.S. Edition to Licensee forthwith upon publication thereof.
6. MATERIAL CREATED OR ACQUIRED BY LICENSEE.
Licensor shall have the reciprocal right to use and publish material
published in the Japanese Edition on the same terms as are set forth in Sections
4 and 5 as applied to Licensee. Licensee agrees, to the extent permitted by any
applicable agreement between Licensee and the party submitting such original
material, to include in its agreements for acquisition of original material to
be used in the Japanese Edition provisions that provide for the right of
Licensor to publish such material in the U.S. Edition upon the payment of a fee
of up to * of the fee paid by Licensee in its acquisition of rights to the
material.
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* Confidential Treatment Requested.
5.
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7. COLLABORATION.
Licensor and Licensee agree that the U.S. and Japanese Editions shall
each reflect the global perspective of WIRED Magazine, and each party agrees to
provide the other party with information regarding internal discussions of
future story ideas and story development in order to further the goal of a
global perspective for all versions of WIRED Magazine.
8. QUALITY CONTROL.
(a) The parties agree that the intent of this Agreement is a high level
of collaboration in the publication of both the U.S. and Japanese Editions.
Licensor shall not have the right to determine which articles published in the
U.S. Edition shall be reprinted in the Japanese Edition. However, Licensee
acknowledges that Licensor has an interest in maintaining the worldwide goodwill
and recognition of the Licensed Mark and in ensuring that the Japanese Edition
shares a common vision with the U.S. Edition in quality, format and content.
Licensor acknowledges that Licensee has an interest in producing a Japanese
Edition that meets the needs of the relevant market. Licensee acknowledges the
unique look of the U.S. Edition, including the unusual design and high quality
of manufacture, and agrees that the Japanese Edition will reflect a like unique
quality measured by Japanese standards.
(b) In order to ensure a common vision and establish acceptable quality
standards, Licensee shall consult with Licensor in advance on the final look of
the Japanese Edition. Licensee will submit the first issue of the Japanese
Edition to Licensor for Licensor's approval prior to publication, and agrees
that it will not publish the first issue until it has received Licensor's
approval. Thereafter, Licensee agrees that all subsequent issues of the Japanese
Edition will be of the same quality as the first issue. Licensee, at its
expense, shall provide ten (10) copies of each issue of the Japanese Edition
promptly after publication for Licensor's review and comment. In addition,
Licensee shall, at its expense, provide samples of any Licensed Products or
other material or advertising bearing the Licensed Mark to Licensor upon
Licensor's request. Licensee shall employ and maintain a staff adequate for
publication of the Japanese Edition.
(c) If at any time during the term of this Agreement, Licensor
determines that any Licensed Product does not meet the quality standards
required in this Section 8 or a Licensed Product Appendix, Licensor shall notify
Licensee and shall specify the steps Licensee must take to correct the quality
of the Licensed Product to Licensor's satisfaction. Licensee agrees to bring the
quality of the Licensed Product up to the standards required in this Section 8
or a Licensed Product Appendix in the next issue of the Japanese Edition or the
next publication or manufacture of any Licensed Product.
9. LICENSE FEES.
In consideration of the rights and licenses, including but not limited
to that of the use of the Materials and the Licensed Mark, granted to Licensee
herein, Licensee shall pay to Licensor the following license fees:
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(a) ADVERTISING REVENUES. Licensee shall pay to Licensor the
below-specified percentages of Net Advertising Revenues earned per issue of the
Japanese Edition:
<TABLE>
<CAPTION>
NET ADVERTISING REVENUE PER ISSUE ROYALTY RATE
<S> <C>
*
</TABLE>
(b) CIRCULATION REVENUES. Licensee shall pay to Licensor the
below-specified percentages of Circulation Revenues earned from the sale of
Licensed Products per issue:
<TABLE>
<CAPTION>
NUMBER OF COPIES SOLD PER ISSUE ROYALTY RATE
<S> <C>
*
</TABLE>
10. ADVANCE PAYMENT.
Licensee shall pay to Licensor * upon the execution of this Agreement
and shall pay to Licensor an additional * six months after the Launch Date. Such
payments shall constitute advances against royalties and shall be
non-refundable.
11. MINIMUM ROYALTIES.
Based on the royalties described in Sections 9 and 10 above, Licensee
agrees to pay to Licensor guaranteed minimum annual royalties ("Minimum
Royalties") as follows:
<TABLE>
<CAPTION>
CALENDAR YEARS MINIMUM ANNUAL ROYALTIES
<S> <C>
*
</TABLE>
Minimum Royalties for each year shall be paid within thirty (30) days
of the end of each calendar year. If royalties at least equal to the Minimum
Royalties are not paid when due during each of the * years ending with calendar
year * , the License shall automatically terminate on January 31, * . Beginning
with calendar year * , if royalties at least equal to the Minimum Royalties are
not paid for any * consecutive calendar years, the License shall
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* Confidential Treatment Requested.
7.
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automatically terminate upon the due date for the payment of the Minimum
Royalties for the * of such years.
12. PROMOTIONAL ITEMS.
Licensee may use the Licensed Mark in connection with, and no royalty
shall be due on, any of the following items which Licensee distributes free of
charge solely for the promotion of Licensed Products: mugs, pens and stationery.
The use of the Licensed Mark on or with any other promotional items must be
approved in writing by Licensor. Royalties will be negotiated and due if
Licensee desires to sell any promotional items.
13. REPORTS, RECORDS AND AUDIT RIGHTS.
(a) Within ninety (90) days after the end of each calendar quarter,
Licensee will provide Licensor with a statement showing for the previous quarter
and for the calendar year-to-date, the value, expressed in local currency, of
subscriptions billed, the net number and cover price of copies sold other than
by subscriptions (showing gross non-subscription sales less returns) and
Advertising Revenues billed (showing gross billings, commissions and discounts),
accompanied by a copy of related print orders and distribution statements
showing sales and returns and the amount of percentage royalties due and payable
thereon. Receipt or acceptance by Licensor of any statement furnished pursuant
hereto or any sums paid by Licensee hereunder shall not preclude Licensor from
verifying the correctness thereof as provided below.
(b) Licensee shall keep accurate books of accounts and records covering
all transactions relating to this Agreement and Licensed Products and shall
permit Licensor, directly or through its authorized agents or auditors, full
access to and to inspect the same during reasonable business hours and upon
prior written notice to enable Licensor and its authorized agents or auditors to
conduct an examination of and to copy all such books and records. All books of
account and records shall be kept available for at least two (2) calendar years
after the expiration or termination of this Agreement, and in the event that
there shall be an unresolved dispute with regard to the royalties payable
hereunder at the end of such period of time, all such records shall be preserved
by Licensee until such dispute shall have been resolved.
(c) If any examination referred to in Section 13(b) above discloses an
overpayment or underpayment of royalties, the appropriate amount shall be
promptly paid or refunded to the party entitled thereto. If such examination
reveals that for the period covered by such examination there is an underpayment
of five percent (5%) or more in the royalty previously reported as being due
from Licensee, all expenses involved in the conducting of such examination shall
be borne by Licensee. In all other cases, such expenses shall be borne by
Licensor.
14. PAYMENTS.
(a) ROYALTY PAYMENTS. Each statement delivered pursuant to Section
13(a) above shall be accompanied by payment of all royalties due for the period
covered by such statement.
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* Confidential Treatment Requested.
8.
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(b) CURRENCY. All payments hereunder shall be made in United States
Dollars. In determining the payments due hereunder, it is agreed as follows:
(i) Licensee shall calculate percentage royalties in Japanese
Yen on a calendar quarterly basis (with each such quarter considered to be a
separate accounting period for the purpose of computing royalties).
(ii) Licensee shall compute a conversion of each such
quarterly total into United States Dollars utilizing the then-current Currency
Exchange Rate. The initial Currency Exchange Rate shall be the exchange rate of
Japanese Yen for each United States Dollar published in the U.S. Edition of The
Wall Street Journal on the Effective Date. The Currency Exchange Rate shall be
adjusted as of the end of each calendar quarter to equal the average of (a) the
initial Currency Exchange Rate set forth above and (b) the Yen/Dollar exchange
rate published in the U.S. edition of The Wall Street Journal on the first
business day after the last day of such calendar quarter, provided, however,
that if the difference between the two rates to be averaged is less than five
percent (5%), then the adjusted Currency Exchange Rate shall be equal to the
initial Currency Exchange Rate set forth above.
(c) TAXES. Licensee shall be responsible for paying all taxes
(excluding Licensor's income taxes) that may arise out of the transactions
contemplated by this Agreement, including, but not limited to, value added
taxes. Licensee shall submit any returns required by any tax office having
jurisdiction and pay the tax in the proper amount. Licensee shall provide
Licensor with evidence that any such tax (including withholding tax) has been
paid so that Licensor has documented proof of such payment. Licensee shall be
entitled to deduct the amount of any withholding taxes paid on Licensor's behalf
from any payments due Licensor hereunder.
15. WARRANTY.
Licensor represents and warrants that Licensor has and shall continue
to have the right to license or sublicense under this Agreement the use of all
the Materials from the U.S. Edition, subject to the terms of any applicable
agreement between Licensor and the party submitting such Materials. Unless
Licensee has received prior notice from Licensor that such rights are not
available, Licensee shall be free to use in the Japanese Edition all the
Materials listed by Licensee in Section 5.
16. LICENSED MARK.
(a) Licensee recognizes Licensor's ownership of the Licensed Mark and
shall not at any time do or suffer to be done any act or thing which will in any
way impair the rights of Licensor in and to the Licensed Mark. Licensee shall
not acquire and shall not claim any right, title, or interest in the Licensed
Mark adverse to Licensor by virtue of the license granted to Licensee herein or
through Licensee's use of the Licensed Mark.
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(b) Licensee shall affix notices of the Licensed Mark, in accordance
with the Guidelines attached hereto as Exhibit C, to all copies of the Licensed
Products and to all advertising, promotional and display material used in
connection with the sale thereof.
(c) Licensee hereby acknowledges the following: (i) the great value of
the goodwill associated with the Licensed Mark; (ii) the worldwide recognition
of the same; (iii) that the proprietary rights therein and goodwill attached
thereto are solely owned by and belong to Licensor; (iv) that the Licensed Mark
have a secondary meaning that is firmly associated in the mind of the general
public with Licensor, its publications and other activities; and (v) that any
additional goodwill that becomes associated with the Licensed Mark through the
use of the Licensed Mark by Licensee shall inure solely to the benefit of
Licensor. During and after the term of the License, Licensee shall not:
(i) attack or question the validity of the title or any rights
of Licensor in and to the Licensed Mark or any other trademark or copyright of
Licensor;
(ii) file or prosecute trademark applications regarding the
Licensed Mark or other trademarks owned or used by Licensor unless asked to do
so in writing by Licensor. Licensee will cooperate with Licensor in connection
with any such filings.
17. TERM AND TERMINATION.
(a) This Agreement shall become effective on the Effective Date and
shall continue in full force and effect during a period of seven (7) years
commencing on the Effective Date, unless earlier terminated in accordance with
terms of this Agreement. The parties agree to discuss the terms of a renewal of
the Agreement within the six month period prior to the expiration of the
Agreement. Notwithstanding any provision of this Section 17, Sections 16(c),
19(a) and 19(b) shall survive such term of termination and continue in full
force and effect thereafter.
(b) Notwithstanding Subsection 17(a) above, a party may terminate this
Agreement by giving written notice to that effect to the other party if the
other party becomes insolvent or makes an assignment for the benefit of
creditors, or proceedings in voluntary or involuntary bankruptcy are instituted
on behalf of or against the party.
(c) Licensor may terminate this Agreement by written notice to that
effect to Licensee prior to the expiration of the Term should Licensee either:
(i) fail to make payment of any installment of the license
fees when due, and such failure shall not have been cured within twenty (20)
days after written notice thereof is given to Licensee; or
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(ii) fail to perform any other obligation required of it
hereunder, and such failure shall not have been cured within thirty (30) days
after written notice thereof is given to Licensee.
(iii) fail to maintain quality standards for the use of the
Licensed Mark agreed to hereunder or in any subsequent Licensed Product
Appendix.
(iv) merge with or become a subsidiary of any other company,
or be purchased by a person, firm, company, corporation, or other organization.
(d) Licensee may terminate this Agreement by written notice to Licensor
prior to the expiration of the Term should Licensor fail to perform any
obligation required of it hereunder, and such failure shall not have been cured
within thirty (30) days after written notice thereof is given to Licensor.
(e) During the period commencing on the first anniversary of the
Effective Date of this Agreement and terminating six (6) months following the
date of publication of the first Japanese Edition, Licensee may terminate this
Agreement by written notice to Licensor prior to the expiration of the Term
should Licensee determine in its good faith business judgment that the Japanese
Edition is not a commercially viable business venture, and upon termination of
this Agreement pursuant to this Subsection 17(e), Licensee shall not be
obligated to pay any further fees or expenses except those fees set forth in
Sections 9 and 10 and any amounts which have become due prior to a termination
owing to Licensee's breach of this Agreement.
(f) This Agreement and the licenses granted herein shall terminate
automatically, and all rights granted hereunder shall revert to Licensor if
Licensee has not commenced monthly publication and distribution of the Japanese
Edition in the Licensed Territory by April 30, 1995.
18. RIGHTS UPON TERMINATION.
(a) Upon the expiration or early termination of this Agreement,
Licensee shall discontinue immediately all uses of the Licensed Mark, and all
rights granted to Licensee herein shall automatically terminate and revert to
Licensor. Upon the request of Licensor, Licensee, at Licensee's sole cost and
expense, shall promptly return to Licensor all illustrations, photographs (black
and white, and color), and drawings from the Materials and all copies thereof
and all other Material in Licensee's possession hereunder.
(b) Notwithstanding the terms of Subsection 18(a) immediately above, in
the event that this Agreement terminates for reasons other than Licensee's
breach hereof, Licensee shall have the right to sell, in the regular course of
business, copies of the Japanese Edition on hand as of the date of termination,
provided that Licensee shall pay to Licensor the license fees provided for
hereinabove and that, within five (5) days after the date of termination,
Licensee shall furnish to Licensor a written inventory of such copies.
Notwithstanding the expiration or early termination of this Agreement, the
Licensee shall remain fully liable to Licensor for (i) any
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license fees due and unpaid, and (ii) damages for any breach hereof, as well as
for any unperformed portion hereof.
19. INDEMNITY.
(a) Licensee shall indemnify, defend, save, and hold harmless Licensor
against any and all liability, loss, damages, cost, and expense, including
without limitation reasonable attorney's fees, arising by reason of, or with
respect to, any claim of copyright infringement arising out of the publication
of the Japanese Edition by Licensee or the publication or distribution of any
Licensed Products hereunder or the modification of Material by Licensee or the
use of the Japanese Material, and not caused by any violation or breach by
Licensor of any of its covenants contained herein. The terms of this subsection
shall survive the expiration or early termination of this Agreement.
(b) Licensor shall indemnify, defend, save, and hold harmless Licensee
against any and all liability, loss, damages, cost, and expense, including
without limitation reasonable attorney's fees arising by reason of, or with
respect to, any claim of copyright infringement arising out of the publication
of the Material, and not caused by any violation or breach or modification of
such Material by Licensee of any of its covenants contained herein. The terms of
this subsection shall survive the expiration or early termination of this
Agreement.
(c) Each party's obligations hereunder as to any indemnification claim
shall be conditioned on the other having given prompt notice to the indemnifying
party; and the indemnifying party shall have the right to defend such claims
using counsel of its choice, in which event the other party shall fully
cooperate in the defense thereof. In no event may the indemnified party under
this Section 19 make or settle any such suit or claim without the prior written
approval of the indemnifying party.
(d) IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY
CONSEQUENTIAL DAMAGES THAT MAY RESULT FROM COPYRIGHT INFRINGEMENT. IN NO EVENT
WILL LICENSOR BE LIABLE TO LICENSEE OR ANY THIRD PARTY FOR ANY LOST PROFITS,
LOST SAVINGS OR OTHER INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES.
20. INFRINGEMENT ACTIONS.
(a) Licensor shall use its best commercial efforts to ensure that the
Materials in the form provided by Licensor under this Agreement shall not
constitute infringement of the copyright of any third party.
(b) Licensee shall promptly notify Licensor in writing of any uses
which may constitute infringements by others of the Licensed Mark or any of the
rights granted Licensee hereunder that may come to Licensee's attention.
Licensor shall have the sole right to determine through consultation with
Licensee whether any action shall be taken against any third party on account of
any such infringements, and Licensee shall not institute any suit or take any
action
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against any third party on account of any such infringements without first
obtaining Licensor's written consent to do so. Licensor shall bear all expenses
connected with any such suit or action; provided, however, that Licensee shall
bear all expenses arising in connection with any suit or action initiated by
Licensee to protect the interests of Licensee alone. Any recovery as a result of
such action shall belong solely to Licensor, except to the extent that such
recovery represents damages suffered by Licensee, in which event any specified
recovery, net of all expenses paid by Licensee, including without limitation
Licensee's attorneys' fees, if any, shall be payable to Licensee. If Licensor
refuses to prosecute an infringement of Licensee's rights, Licensee may
terminate this Agreement by written notice to Licensor, in which event the
parties shall have no further rights or duties to each other under this
Agreement, except for such obligations as are expressly stated to survive the
termination of this Agreement.
21. INDEPENDENT CONTRACTORS.
This Agreement does not constitute and shall not be construed as
constituting a partnership, agency relationship, or joint venture between
Licensee and Licensor. Neither party shall have the right to obligate or bind
the other in any manner whatsoever, except as provided hereunder.
22. FORCE MAJEURE.
Neither party hereto shall be liable for failure to perform its
respective obligations (except for the obligation to make payments) under this
Agreement if such failure is owing to earthquake, fire, flood, strike, labor
disturbance, war (declared or undeclared), embargo, blockade, legal restriction,
riot, insurrection or any other cause beyond the reasonable control of such
party.
23. ENTIRE AGREEMENT; WAIVER; MODIFICATION.
This Agreement constitutes the entire agreement between the parties
hereto relating to the subject matter hereof. No change, waiver, or modification
shall be valid or binding upon the parties unless said change, waiver, or
modification shall be in writing and signed by both parties. The waiver of a
breach of any term or condition herein shall not be deemed a waiver of any
subsequent breach, whether of the same or similar nature, and shall not in any
way affect the other terms and conditions hereof. If any provision of this
Agreement shall be held invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby. If any term or section of this Agreement shall be
determined to be unenforceable, such term or section shall be modified so that
the unenforceable term or section shall be enforceable to the greatest extent
possible.
24. CHOICE OF LAW; ARBITRATION.
(a) This Agreement shall in all respects be interpreted, construed, and
governed in accordance with the laws of the State of California, regardless of
its place of execution or performance. Subject to Section 24(b) below, any
dispute arising out of or in connection with
13.
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this Agreement shall be finally settled by arbitration in the city of San
Francisco, California in accordance with the Commercial Arbitration Rules of the
American Arbitration Association, if such arbitration is initiated by Licensee,
and in the city of Tokyo, Japan in accordance with the Commercial Arbitration
Rules of the Japan Commercial Arbitration Association, if such arbitration is
initiated by Licensor.
(b) Licensee acknowledges that any breach by it of the provisions of
this Agreement regarding the use of the Licensed Mark will result in irreparable
harm to Licensor for which there is no adequate remedy at law and that Licensor
shall be entitled to timely injunctive relief notwithstanding Section 24(a)
above, without the necessity of posting bond, in addition to such other relief
as any Arbitration Association or court of competent jurisdiction may deem just
and proper.
(c) In the event either party files any action against the other to
enforce any of the provisions under this Agreement or to secure or protect such
party's rights under this Agreement, such party shall be entitled to recover, in
any judgment in its favor entered therein, the attorneys' fees and litigation
and arbitration costs of such party, together with such court costs and damages
as are provided by law.
(d) THE OFFICIAL TEXT OF THIS AGREEMENT AND ANY EXHIBIT OR ANY NOTICE
GIVEN OR ACCOUNTS OR STATEMENTS REQUIRED BY THIS AGREEMENT SHALL BE IN ENGLISH.
THE RESOLUTION OF ANY DISPUTE WILL BE CONDUCTED IN ENGLISH.
25. ASSIGNMENT OR SUBLICENSE.
(a) NO ASSIGNMENT OR SUBLICENSE BY LICENSEE. Licensor in entering into
this Agreement is relying upon the skills, reputation and personnel, of
Licensee. This Agreement and all rights and duties hereunder are personal to
Licensee and shall not, without the prior express written consent of Licensor,
be assigned or sublicensed by Licensee. Any attempt by Licensee to assign or
sublicense or otherwise transfer this Agreement without the prior express
written consent of Licensor shall constitute a material breach of this
Agreement.
(b) ASSIGNMENT BY LICENSOR. Licensor shall have the right to assign its
rights under this Agreement.
(c) BINDING ON SUCCESSORS. In the case of any authorized assignment of
this Agreement, this Agreement shall be binding upon the representatives,
successors and assigns of the parties.
26. NOTICES.
All notices permitted or required under this Agreement shall be in
writing and shall be delivered by personal delivery, facsimile transmission,
courier, or by certified or registered mail, return receipt requested, and shall
be deemed given upon personal delivery, fifteen days after deposit in the mail,
four days after delivery to a courier service, or upon receipt of electronic
14.
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transmission. Notices shall be sent to the addresses set forth below, or to such
other addresses as may be specified by the parties in writing.
(i) if to Licensee, at 428 Koyuidana-cho, Shinmachi- dori,
Shijo-agaru Nakagyo-ku, Kyoto 604, Japan, Attention: Mr.
Satoru Imada;
(ii) if to Licensor, at 544 Second Street, Third Floor, San
Francisco, California, 94107, U.S.A., Attention: Jane
Metcalfe; or
(iii) to such other address or the attention of such other person as
either party may specify by written notice to the other.
27. GUARANTEE.
In the event that Licensor discontinues publication of the U.S. Edition
or sells the right to publish the U.S. Edition to any third party, Wired
Holdings, Inc. guarantees that none of Licensee's rights as set forth in this
Agreement, including the right to use the Licensed Mark, shall be impaired
thereby.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written and an executed original
hereof to have been delivered to each party hereto.
WIRED VENTURES, LTD.
By: /s/ LOUIS ROSSETTO
---------------------------------
KABUSHIKI-KAISHA DOHOSHA SHUPPAN
By: /s/ SATORU IMADA
---------------------------------
15.
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EXHIBIT A
FORM OF LICENSED PRODUCT APPENDIX
Description of Paper Product:
Terms of License that differ from Section 2:
Royalties:
Advance Against Royalties: a non-refundable fee of $_____ due on __________.
Additional Terms:
<PAGE> 17
EXHIBIT B
LICENSED MARKS
Trademark:
WIRED
Class 16 in Japan (English (block letters and stylized versions), katakana and
hiragana versions) for printed matter.
Service Mark:
WIRED
Class 41 in Japan (English, katakana and hiragana versions) for publication of
magazines.
Use of Licensed Mark on promotional items is authorized for the limited purpose
of and in accordance with Section 12.
<PAGE> 18
EXHIBIT C
COPYRIGHT AND TRADEMARK PROTECTION GUIDELINES
The following guidelines and procedures are based on Licensor's present
understanding of copyright and trademark law and, therefore, these procedures
will be revised if changes are necessary for complete copyright and trademark
protection:
1. All copies of each issue of the Japanese Edition shall contain on
the title page a copyright notice as follows:
"Published and distributed by Dohosha Publishing Co., Ltd. by
permission of Wired Ventures Ltd., San Francisco, U.S.A. All rights
reserved (C) 199__ Wired Ventures Ltd. Original Japanese materials (C)
199__ by Dohosha Publishing Co., Ltd."
2. Only exact reproductions of Licensor's trademarks and service marks
may be used.
3. All Licensed Products shall bear the following notice:
""WIRED" is a trademark of "Wired Ventures, Ltd." and other
trademark notices as directed by Licensor.