Trademark License Agreement For Del Monte Corp.

TRADEMARK LICENSE AGREEMENT


This Trademark License Agreement ("Agreement") is made and entered into effective as February 4, 2004, by and between DEL MONTE CORPORATION, a Delaware corporation with a principal business address of One Market @ The Landmark, San Francisco, California 94105 ("LICENSOR"), and COFFEE HOLDING CO., INC., a Nevada corporation with a principal business address of 4401 First Avenue, Suite 1507, Brooklyn, New York 11232 ("LICENSEE").


RECITALS


A. LICENSOR is the owner of the trademarks S&W, IL CLASSICO and S&W and design and the registrations thereof listed on Schedule A attached hereto and made a part hereof (collectively, the "Marks").


B. LICENSEE operates a wholesale coffee business, including manufacturing, roasting, packaging, marketing and distributing roasted and blended coffees for private label accounts and its own brands.


C. LICENSEE desires to obtain the exclusive right to use the Marks on and in connection with the production, manufacture, distribution and sale in the United States (the "Territory") of certain coffee products as described more fully in Section 1 of this Agreement. LICENSOR is willing to grant LICENSEE the right to use the Marks in said Territory, upon the terms and conditions hereinafter set forth:


NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:


1. Grant of License


LICENSOR hereby grants to LICENSEE, subject to the terms and conditions of this Agreement, an exclusive license to use the Marks solely in the Territory and solely on and in connection with the production, manufacture, distribution and sale of roasted whole bean and ground coffee for distribution at the retail distribution level (the "Products"). The license does not include the right to use the Marks on or in connection with any other products or activity and does not include the right to use the Marks outside of the Territory. All rights not expressly granted herein are retained by LICENSOR. LICENSEE acknowledges that use of the Marks by LICENSOR on a global Internet web site or successor technology to identify Products sold outside the Territory does not violate this Agreement.


2. Royalty Payments


(a) In consideration for the license granted herein, LICENSEE agrees to pay LICENSOR royalties as follows:


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(i) [Confidential treatment requested]


(ii) [Confidential treatment requested]


Year 1 shall include the period from the date of this Agreement through December 31, 2004. Each contract year thereafter shall commence on January 1 and terminate on December 31.


(b) "Net Sales" as used in this Agreement shall mean LICENSEE's gross sales value (the gross invoice amount billed customers) of the Products, less discounts and customer allowances and less returns and damage claims up to the amount of the actual sales value of the Products.


(c) Royalties earned shall be computed and reported for each calendar quarter and shall be due and payable within thirty (30) days of the end of each quarter. Each royalty payment shall be accompanied with a royalty report that sets forth for the most recent quarter and calendar year-to date, in reasonable detail, (i) gross sales of the Products, (ii) Net Sales of the Products with detail showing the calculation of Net Sales from gross sales, and (iii) the royalty payment for the most recent quarter and the calculation thereof. The royalty report shall include a statement signed by a duly authorized officer of LICENSEE certifying the accuracy of such report and the computation of royalties earned and payments made.


(d) To the extent royalties paid during any contract year are less than the Minimum Annual Royalty, LICENSEE shall pay such difference to LICENSOR within thirty (30) days of the end of such contract year (together with the fourth quarter royalty payment).


(e) Amounts not paid when due will bear interest at the lower of the maximum lawful interest rate or a rate of one percent (1.0%) per month.


(f) Should LICENSEE terminate this Agreement or cease sales of Products within a given year, LICENSEE shall be liable to LICENSOR for the full Minimum Annual Royalty for such contract year in addition to any other remedies to which LICENSOR shall be entitled by operation of law.


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3. Ownership of the Marks


(a) LICENSEE hereby acknowledges that LICENSOR is the owner of the Marks and that LICENSEE's right to use the Marks is limited and derived solely from this Agreement. LICENSEE acknowledges that it shall not acquire any rights of ownership whatsoever in the Marks as a result of LICENSEE's use thereof, and that all goodwill arising from ownership of the Marks (as distinguished from any enhancement of value to LICENSEE's business arising from the license granted hereunder) shall inure exclusively to the benefit of LICENSOR. LICENSEE shall include on all packages, cartons and containers in which the Products are marketed and on all labels and advertising and promotional material, the name and address of LICENSEE as manufacturer of the Products and the phrase "S&W is a registered trademark used under license," or equivalent approved in writing by LICENSOR.


(b) LICENSEE agrees to execute and deliver to LICENSOR, upon LICENSOR's request, all documents which are necessary or desirable to secure or preserve LICENSOR's rights in or registrations of the Marks or to record this Agreement, as appropriate, or to cancel such registrations or recordations, as appropriate. LICENSEE further agrees to assist LICENSOR in registering, maintaining and reporting the Marks and use thereof as requested by LICENSOR. LICENSEE will pay its own costs and expenses in this regard. All registration, recordal and maintenance costs of the Marks shall be at the sole cost and expense of LICENSOR.


(c) Each of LICENSEE and LICENSOR hereby represents and warrants to each other that (i) it has full corporate power and authority to enter into this Agreement and to perform its obligations hereunder; (ii) this Agreement has been duly authorized by all necessary action on its part; and (iii) neither execution of this Agreement by it nor performance of its obligations hereunder will constitute a breach of any agreement to which it is a party. LICENSOR further represents and warrants to LICENSEE that (i) neither execution of this Agreement by it nor performance of its obligations hereunder will constitute a breach of any agreement to which any of the Marks is subject and (ii) all necessary consents have been obtained by persons who claim a security interest in the Marks, or any of them.


4. Term


Subject to Section 8 hereof, this license shall commence as of the date of this Agreement and continue for an initial term of ten (10) years ending at the close of business on December 31, 2014. Thereafter, subject to Section 8, his Agreement shall continue automatically for up to two (2) additional terms of five (5) years each, unless either party provides written notice of non-renewal to the other party no less than six (6) months in advance of the expiration of the initial term or any subsequent renewal term.


5. Quality Control and Other Conditions


LICENSEE acknowledges the importance to LICENSOR and to its reputation and goodwill, and to the public, of maintaining high, uniform standards of quality in the Products produced, manufactured, distributed and sold under the Marks. Therefore, LICENSEE agrees to:


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(a) Use the Marks in a manner that will protect LICENSOR's rights and goodwill therein, including the use of all notices, legends or markings that may be required by LICENSOR in order to give appropriate notice of any of the Marks. No additional markings, legends or notices shall be used by LICENSEE on Products without first obtaining LICENSOR's prior written approval, other than LICENSEE's corporate identification;


(b) Prior to marketing the Products in the Territory (including any subsequent new Products), submit to LICENSOR for approval production samples (including packaging) of the Products (the "Pre-Production Samples"), with LICENSOR's approval thereof not to be unreasonably withheld or delayed. LICENSEE shall not commence distribution of the Products in the Territory until LICENSOR has communicated its approval of the Pre-Production Samples to LICENSEE in writing and all Products subsequently manufactured for distribution in the Territory shall conform to the Pre-Production Samples;


(c) Produce and manufacture Products according to specifications and other quality control standards established or approved by LICENSOR, the details of which shall be supplied in writing by LICENSOR to LICENSEE from time to time;


(d) Submit proposed new varieties for Products for written approval by LICENSOR according to procedures provided to LICENSEE by LICENSOR;


(e) Affix the Marks to or on packaging, advertising and promotional materials only according to the formats, logo types, colors, styles and specifications used by LICENSOR as of the date of this Agreement or according to any other formats, logo types, colors, styles and specifications as shall be specifically approved in advance by LICENSOR in writing;


(f) Not use the Marks in any way other than expressly set forth herein, except in such form and manner as shall be specifically approved in advance by LICENSOR in writing, and according to specifications provided by LICENSOR to LICENSEE;


(g) In no event use any of the Marks in any way outside the Territory or in connection with any other good or service other than the Products, except as permitted under any other written license between the parties;


(h) Submit to LICENSOR at LICENSOR's request, but not more than once in each calendar year, a complete list and representative samples of each variety of the Products and of all packaging, advertising and promotional materials bearing the Marks in order that LICENSOR may confirm, among other things, that (i) the Products conform to the specifications approved by LICENSOR, (ii) the Products are of merchantable quality and free from defects in workmanship and materials, and (iii) the use of the Marks on the Products conforms to the terms set forth herein;


(i) To the extent permitted by law, use all reasonable efforts to ensure that purchasers of Products do not distribute or sell or cause or assist the distribution or sale of


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