License Agreement by and between Starco Brands, Inc. and Temperance Distilling Company, executed January 24, 2022

Exhibit 10.25

CERTAIN INFORMATION HAS BEEN EXCLUDED FROM THIS EXHIBIT 10.1 BECAUSE IT IS BOTH (i) NOT MATERIAL AND (ii) WOULD LIKELY CAUSE COMPETITIVE HARM TO THE COMPANY IF PUBLICLY DISCLOSED. SUCH REDACTED INFORMATION WILL BE PROVIDED ON A SUPPLEMENTAL BASIS TO THE SECURITIES AND EXCHANGE COMMISSION OR ITS STAFF UPON REQUEST

BRAND LICENSE AGREEMENT

This License Agreement (“Agreement”), effective January 24, 2022 is entered into by Starco Brands, Inc. (hereinafter “LICENSOR”) and Temperance Distilling Company (hereinafter “LICENSEE”).

RECITALS

WHEREAS, Starco Brands creates, develops and owns brands, trade names and marketing data of consumer and commercial products, and;

WHEREAS, Temperance Distilling Company is a developer and manufacturer of consumer beverage and spirits products;

WHEREAS, LICENSEE desires and LICENSOR agrees to allow LICENSEE to manufacture and sell Licensed Brands throughout the Territory as provided in this Agreement.

Now therefore, in consideration of the foregoing provisions which are incorporated herein by reference and made part hereof, the mutual and several representations, warranties and covenants set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, LICENSOR and LICENSEE hereby agree as follows:

LICENSOR hereby grants to LICENSEE, subject to the terms and conditions herein, the non-exclusive, non-transferable, right, privilege and license to make, have made, use, sell, have sold, advertise, distribute and have distributed the Licensed Brands in connection with the Licensed Products in the Market and within the Territory. Other than the Licensed Products, all other goods and services of any kind, based on or incorporating, or provided with or under any of the Licensed Brands, or in any manner identifying or mentioning LICENSOR, are expressly excluded from the rights licensed to LICENSEE pursuant to this License Agreement. All rights not expressly granted to LICENSEE by this License Agreement are expressly reserved to LICENSOR

This Agreement shall become effective upon the date first above written, and shall remain in effect until midnight, December 31, 2032 unless sooner terminated according to the terms of this Agreement.

The previous paragraph notwithstanding, it is understood between both LICENSEE and LICENSOR that prior to the execution of this Agreement transactions involving the Licensed Brands did occur. It is agreed that this Agreement will retroactively apply to those transactions and the Royalties due for those transactions will be calculated and paid by LICENSEE within 60 days of execution of this Agreement.

LICENSEE shall pay LICENSOR based on the following model:

Royalties shall be the LICENSEE’s “Net Unit Sales” of the Licensed Products (‘‘Royalties’). The term “Net Unit Sales” shall mean the gross invoiced unit sales of the Licensed Products less (i) LICENSEE’s Costs of the Licensed Products (as defined below) and (ii) discounts, allowances, freight and applicable taxes and other expenses mutually agreed to from time to time.

Royalties shall accrue upon invoicing when the Licensed Products are first sold and delivered by LICENSEE. LICENSEE shall pay to LICENSOR in US currency the Royalties due on all Licensed Products for which payment has been received in each calendar month by the 15th day of the subsequent month. LICENSEE shall provide a written royalty report to LICENSOR detailing the customer, unit sales of Licensed Products, sale price, sale total, amount received, any discounts and/or allowances and other expenses deducted used to calculate the Royalties due with each payment of Royalties.

The LICENSEE will manufacture or may subcontract the manufacture of the Licensed Products and earn a [REDACTED] ([REDACTED]%) percent gross margin on its cost of goods based on GAAP and the costing model attached in Exhibit B, said costs of goods sold and [REDACTED] ([REDACTED]%) percent gross margin thereon being referred to herein as “LICENSEE’s Costs”. LICENSEE’s Costs will not be updated more frequently than quarterly and may change only with LICENSEE and LICENSOR’s joint approval.

The LICENSEE may sell Licensed Products to distributors at varying prices. Therefore, Royalties on any given Licensed Product may fluctuate depending on the price for which the Licensed Product is sold in any given distribution channel as well as upon changes in the LICENSEE’S Costs in accordance with the preceding paragraph. As an example only, if the LICENSEE sells Licensed Products to a distributor for a gross invoiced price of $[REDACTED] per unit and the LICENSEE’s Cost in manufacturing the Licensed Product is $[REDACTED] per unit, then the Royalty on those Licensed Products is $[REDACTED] per unit less applicable discounts, allowances, freight, taxes or other approved expenses. If LICENSEE later sells more of those Licensed Products to a distributor for a gross invoiced price of $[REDACTED] per unit and the LICENSEE’s Cost in manufacturing has increased to $[REDACTED] per unit, then the Royalty on those Licensed Products is $[REDACTED] per unit less applicable discounts, allowances, freight, taxes or other approved expenses.

LICENSEE and LICENSOR acknowledge and agree that the initial production run for the products will incur higher costs due to higher costs of materials and additional labor needed to complete the initial production run. Costs used for the Initial Production Run are found on Exhibit C. The difference between costs shown in Exhibit B and Exhibit C will be reconciled as additional funds due to LICENSEE.

The way the LICENSEE costs the product must be provided to the LICENSOR in full transparency. At the LICENSOR’S election, the LICENSOR may use a third party to audit, at its expense, the costs and expenses used by LICENSEE in its determination of LICENSEE’s Cost as well as its calculation of Royalties.

LICENSEE shall keep full, clear, and accurate records with respect to sales of Licensed Products. Reporting will include the number of units by container size of Licensed Products sold in each reporting period. Upon reasonable notice, LICENSOR, at its expense, may have an independent auditor examine, audit and certify such records as it relates to the Licensed Products covered by this agreement during normal business hours, but not more than twice per year.

LICENSEE shall make prompt adjustment to compensate for any errors or omissions disclosed by any such examination and certification of LICENSEE’s records. If the results of the audit results in an adjustment greater than 5%, LICENSEE will reimburse LICENSOR for the cost of the audit. All amounts due will be payable within 10 days of the acceptance of the audit plus an imputed interest payment of 8% from when the amounts would have been due.

LICENSOR agrees to reimburse LICENSEE for any incurred expenses, marketing or otherwise, that are preapproved by LICENSOR. These expenses will be submitted by LICENSEE to LICENSOR each month for approval, and may be deduced from monthly Royalty payments if approved by LICENSOR.

LICENSEE and LICENSOR shall mutually keep, save, protect, defend, indemnify and hold each other harmless from and against any and all reasonable costs, claims, expenses, reasonable attorneys’ fees, damages or deficiencies (“Losses”) incurred or sustained by the other party arising from manufacturer defects or breach of terms of this Agreement and from and against any and all claims for damages and/or injury, including claims in product liability, patent infringement, regulatory, governmental, and any other torts brought by any party anywhere and as may arise from the manufacture, use, sale, marketing or distribution of any Licensed Product herein, pursuant to the terms of this Agreement. LICENSOR’s indemnification under this Section shall be apportioned and limited to only the portion of, and extent that, such Losses are, or are claimed to be, proximately caused by or attributable specifically to LICENSEE’S use of Licensed Brands in a manner permitted by this License Agreement.

The Parties agree that the indemnity obligations under this Section shall survive the termination of this Agreement.

This Agreement may be terminated immediately under and according to any of the following:

Upon termination or expiration of this License Agreement, all of the rights granted hereunder to LICENSEE and all rights, title and interest in and to the Licensed Brands, including but not limited to, patent, industrial design, copyright, trademark, trade dress and all improvements, additions and changes thereto, trade secret rights, and goodwill relating to the Licensed Brands, shall revert to LICENSOR. LICENSEE, at LICENSOR’s sole cost and expense, agrees to promptly execute all documents that may be reasonably necessary to effect the foregoing. This right and obligation shall survive the termination or expiration of this Agreement. Except as herein provided, upon termination or expiration of this License Agreement, LICENSEE shall forthwith and thereafter cease and desist from manufacturing, selling or distributing.

This Agreement shall be assignable by LICENSEE or LICENSOR to any entity that succeeds to the business of LICENSEE or LICENSOR without the prior written consent of the other party. Other than to an entity that succeeds LICENSEE or LICENSOR, LICENSEE shall not assign any of its rights under this Agreement to any company without the prior written consent of LICENSOR.

Neither LICENSEE nor LICENSOR shall have any authority to bind the other to any contract, representation, understanding, act or deed concerning the other. Nothing contained in this Agreement shall be deemed or construed by the parties hereto or by any third party as creating the relationship between LICENSOR and LICENSEE as that of principal and agent, employer/employee, partner or joint venturer, it being expressly understood and agreed that no provision of this Agreement, nor any act of the parties pursuant thereto, shall be deemed to create any relationship of LICENSEE to LICENSOR other than that of an independent contractor.

This Agreement shall be interpreted under the laws of the State of California. Any dispute, controversy or claim arising out of or relating to this contract, including the formation, interpretation, breach or termination thereof, including whether the claims asserted are arbitrable, will be referred to and finally determined by arbitration in accordance with the JAMS International Arbitration Rules. The Tribunal will consist of one arbitrator. The place of arbitration will be Los Angeles County in the State of California. Judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof.

Neither LICENSEE nor LICENSOR shall be responsible for any default hereunder caused by acts of God, insurrection, civil disorder, war, military action, emergency government actions, labor disputes or other causes over which neither LICENSOR nor LICENSEE have any control.

Neither party to this Agreement shall commit any act or take any action which frustrates or hampers the rights of the other party under this Agreement. Each party shall act in good faith and engage in fair dealing when taking any action under or related to this Agreement.

In case of any mistake in this Agreement, including any error, ambiguity, illegality, contradiction, or omission, this Agreement shall be interpreted as if such mistake were rectified in a manner which implements the intent of the parties as nearly as possible and effects substantial fairness, considering all pertinent circumstances. If any part of this Agreement is found to be invalid or unenforceable it does not invalidate the balance of Agreement.

This Agreement sets forth the entire understanding between the parties and supersedes any prior or contemporaneous oral understandings and any prior written Agreements except that the rights and obligations of the parties under the Agreement shall survive until the term of said Agreement expires.

All rights and licenses to the Licensed Brands not specifically granted to LICENSEE under this Agreement are reserved by and are the exclusive property of LICENSOR.

The parties have indicated their Agreement to all of the above terms by signing this Agreement on the respective dates below indicated. LICENSEE and LICENSOR have each received a copy of this Agreement with both LICENSEE’s and LICENSOR’s original ink signatures thereon.

EXHIBIT A
LICENSED BRANDS

WHIP SHOTS

EXHIBIT B
LICENSED PRODUCTS

Alcohol infused whipped cream; non-dairy alcohol infused whipped cream; vodka infused whipped cream

EXHIBIT C
STANDARD COSTS

EXHIBIT D
INITIAL PRODUCTION RUN