INTELLECTUAL PROPERTY LICENSE AGREEMENT
Republic of the Philippines — License of intellectual property · Template v0.2.0
This Intellectual Property License Agreement (the "Agreement") is made on October 20, 2026 between Kalikasan Creative Studio, Inc., with address at 9/F Cebu IT Park, Lahug, Cebu City 6000 (the "Licensor"), and Mabuhay Retail Holdings, Inc., with address at 3 Ortigas Center, Pasig City 1605 (the "Licensee").
1. Grant of license
The Licensor grants the Licensee a license, for the term stated below, to use the following rights (the "Licensed Rights"), which are trademarks and service marks, copyright works, including software and trade secrets and know-how: The mark SAMPAGUITA QUEST, IPOPHL Trademark Registration No. 4-2024-012345 in Classes 9 and 28, the artwork and characters of the game 'Sampaguita Quest', and the related know-how for producing licensed merchandise.
The Licensee may use the Licensed Rights only in this field: Manufacture, promotion, and sale of plush toys, apparel, and stationery that carry the licensed characters and marks. The territory is the Philippines. The territory is where the Licensee may exercise the Licensed Rights. Nothing in this Agreement prohibits the Licensee from exporting licensed products it makes in the territory (Intellectual Property Code, Section 87).
The license is exclusive. Only the Licensee may use the licensed rights in the territory, even to the exclusion of the Licensor, and the Licensor shall not license anyone else there.
The Licensee may sublicense the licensed rights only with the Licensor's prior written consent, and remains responsible for each sublicensee.
The Licensor keeps ownership of the Licensed Rights, and the Licensee acquires no ownership by using them. The Licensor reserves every right that this Agreement does not expressly grant.
2. Term
The license starts on November 1, 2026 and runs for 3 years. The license may be renewed only by a written agreement that both parties sign.
3. Fees and payment
The Licensee shall pay the Licensor a fixed fee of Two Hundred Fifty Thousand Pesos (PHP 250,000.00), due on signing.
The Licensee shall pay the Licensor a royalty of 7.5% of the Net Sales of products or services that use the Licensed Rights, with a minimum of Two Hundred Thousand Pesos (PHP 200,000.00) for each license year.
"Net Sales" means the gross amounts invoiced by the Licensee and any sublicensee for products and services that use the Licensed Rights, less only (a) value-added tax and other sales taxes shown on the invoice, (b) returns actually credited to customers, and (c) trade discounts shown on the invoice. No other deduction is allowed. Royalties are computed in Philippine pesos.
The Licensee shall send a royalty report each quarter, within 30 days after the end of the period, showing the gross amounts invoiced, each deduction, and the Net Sales, with payment of the royalty due. If the royalties paid for a license year are less than the minimum, the Licensee shall pay the difference within 30 days after the end of that license year.
The Licensee shall keep complete and accurate records of its Net Sales for at least three years after the end of the period they cover.
The Licensor may, on reasonable notice and not more than once a year, have an independent accountant inspect the Licensee's sales records to check the reports. The Licensor bears the cost unless the inspection shows an underpayment of more than five percent, in which case the Licensee bears it.
A late payment bears interest at 6% per year from the due date until paid. This is not an authority for an unconscionable rate, and a court may reduce an iniquitous interest or penalty (Article 1229).
As Section 88 of the Intellectual Property Code requires for technology transfer arrangements, the Philippine taxes on all payments relating to this Agreement are borne by the Licensor. The Licensee may withhold and remit tax as the law requires and shall give the Licensor the withholding certificate.
4. Quality control over the licensed marks
The Licensor shall exercise effective control over the quality of the goods and services that the Licensee sells under the licensed marks, as the law requires for a valid trademark license (Section 150 of the Intellectual Property Code). The Licensee shall produce the licensed goods to the Licensor's written brand and quality standards, submit a pre-production sample and a final sample of each product for the Licensor's approval before sale, and allow the Licensor to inspect its facilities and products on reasonable notice.
The Licensee shall use the marks only in the form the Licensor approves and shall give the Licensor samples on request. The Licensor may suspend use of a mark on a product that does not meet the standards until the defect is fixed.