Nautilus 2009 Annual Report Download - page 147

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F. Trade Secrets, Know How and Confidential Information.
Subject to the terms of this Stairmaster Technology Agreement, Nautilus hereby grants to Buyer a non-exclusive, non-transferable,
non-assignable, non-sublicensable, and worldwide license to Stairmaster Know How, Stairmaster Trade Secrets and Stairmaster
Confidential Information solely for use in connection with sales and marketing of Stairmaster Products in the Commercial Channel and/or
the Permitted Retail Channel.
G. Covenant Not to Sue
Buyer hereby covenants not to sue Nautilus for any violations of any of the Stairmaster Intellectual Property for any Nautilus acts
outside of the Commercial Channel.
3. Registration, Filings and Enforcement.
A. Registrations and Filings. Buyer shall maintain the Registrations of Schedule A that include the word Stairmaster for at least ten
(10) years from the effective date of this Stairmaster Technology Agreement.
4. Payments
A. Royalty on Net Sales of Stairmaster Products in the Commercial Channel.
(i) For the Trademark rights granted by this License Agreement to Buyer for Stairmaster Products sold in the Commercial Channel,
Buyer shall pay Nautilus a fixed Royalty of US$83,333.33 per quarter for each of the Calendar Years 2010, 2011 and 2012. Thereafter,
there shall be no Royalty for Net Sales of Stairmaster Products in the Commercial Channel.
B. Royalty on Net Sales of Stairmaster Products in the IBD and SF Channel.
(i) For the Trademark rights granted by this License Agreement to Buyer for Stairmaster Products sold in the IBD and SF Channel,
Buyer shall pay Nautilus a Royalty which is equal to three (3) percent of Net Sales of Stairmaster Products in the IBD and SF Retail
Channel. The Royalty of this Section 4.B.(i) shall continue for so long as Buyer is selling Stairmaster Products in the IBD and SF Retail
Channel and shall have no applicable Minimum Annual Payment or Royalty Cap.
C. Royalty on Net Sales of Stairmaster Products in the Other Retail Channel.
(i) For the Trademark License rights granted by this License Agreement to Buyer for Stairmaster Products sold in the Other Retail
Channel, Buyer shall pay Nautilus a Royalty which is equal to five (5) percent of Net Sales of Stairmaster Products in the Other Retail
Channel. The Royalty of this Section 4.C.(i) shall continue for so long as Buyer is selling Stairmaster Products in the Other Retail Channel
and shall have no applicable Minimum Annual Payment or Royalty Cap.