EXHIBIT 10.1
January 1, 2001
Major League Baseball Properties, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Gentlemen:
This letter amendment (the "2001 Amendment"), when executed below shall,
with automatic effect on January 1, 2001 (the "Effective Date"), extend and
further amend the license agreement dated as of January 1, 1969 (the "1969
Agreement"), as heretofore amended on April 2, 1974, May 18, 1977, August 23,
1982, August 25, 1983, November 20, 1985, June 25, 1990, August 16, 1990 and
September 28, 1995, between Major League Baseball Properties, Inc. ("MLBP") on
its own behalf and as authorized agent of the Office of the Commissioner of
Baseball (the "BOC"), the American and National Leagues of Professional Baseball
Clubs (the "Leagues") and their member clubs (the "Baseball Clubs") and The
Topps Company, Inc. ("Topps"), as set forth below. The 1969 Agreement, together
with all prior amendments and this 2001 Amendment is sometimes referred to
herein as the "License Agreement". For ease of reference, certain of the
provisions of the amendments prior to this 2001 Amendment have been restated
below without modification, so that upon the Effective Date, all amendments to
the 1969 Amendment that are in effect throughout the term of this 2001 Amendment
are reflected in this 2001 Amendment. The parties hereto do hereby agree as
follows:
1. The term of the License Agreement shall be extended through and
including December 31, 2004, unless earlier terminated pursuant to its
terms.
2. The License Agreement is amended by deleting in its entirety Paragraph
1 in the 1969 Amendment and replacing it with the following:
"1. MLBP hereby licenses Topps for the term of the 2001 Amendment to
use the Major League Baseball silhouetted batter logo (and any other
logo owned by MLBP during such term), and the names and insignia of
each of the BOC, the Leagues and the Baseball Clubs (collectively, the
"Insignia"):
(a) as a part of the uniforms of baseball players shown
(i) in baseball player picture cards ("Trading Cards") to be
sold either alone or in combination with chewing gum of any
kind ("Topps Products"),
(ii) in baseball player photographs reproduced as pictures on
materials other than Trading Cards, including, but not
limited to, player pictures on conventional (non-glossy)
paper stock, smaller than 5 x 7 inches in size ("Player
Pictures"), to be sold (A) in combination with Topps
Products, and (B) alone if substantial sales are made by
Topps of Topps Products sold in combination with Player
Pictures reflecting a bona fide effort by Topps to market
the Player Pictures in combination with Topps Products and
so long as such efforts and sales continue,
(iii)in baseball player, photographs reproduced as posters not
larger than 20 x 12 inches in size (and when folded not
larger than 28 square inches in size) ("Player Posters"), to
be sold in combination with Topps Products.
(iv) in baseball player photographs reproduced as gummed stamps
or stickers, and accompanying albums ("Player Stickers"), to
be sold in combination with Topps Products,
(v) in baseball player photographs reproduced as wax rub-offs,
tattoos and on boxes ("Miscellaneous Reproductions"), to be
sold in combination with Topps Products;
(b) as a part of the Topps Products and the packaging of such Topps
Products, other than on the uniforms of baseball players shown;
and
(c) in advertising and promotional material reasonably connected with
the foregoing uses.
The Trading Cards, Player Pictures, Player Posters, Player
Stickers and Miscellaneous Reproductions are sometimes herein
collectively referred to as the "Baseball Items." This license
is not exclusive and does not constitute and may not be used
so as to imply the endorsement by MLBP, the BOC, the Leagues
or the Baseball Clubs of any product of Topps. Topps
acknowledges that, during the term of the 2001 Amendment, it
shall not use the Insignia on any products other than the
Baseball Items and Topps Products and materials related
thereto, except as provided hereunder or as otherwise approved
by MLBP in writing. In addition, Topps shall use its best
efforts to ensure that all Baseball Items and Topps Products
will present Major League Baseball in a positive light among
children and young adults, consistent with Topps prior and
current practice.
3. All references in the License Agreement to Major League Baseball
Promotions Corporation shall be changed to Major League Baseball
Properties, Inc. All references in the License Agreement to Topps
Chewing Gum, Incorporated shall be changed to The Topps Company, Inc.
4. The territory shall continue to be worldwide, subject to the remaining
provisions of this Paragraph. However, prior to (a) any distribution
or sale by Topps of Baseball Items or Topps Products in a country
other than the United States, its territories and possessions, U.S.
military bases worldwide., Puerto Rico, or Canada (hereinafter, a "New
Foreign Jurisdiction"), or (b) distribution or sale of Baseball Items
or Topps Products by any entity directed by, or under agreement with,
Topps to sell or distribute such items and/or products in a New
Foreign Jurisdiction, Topps shall notify MLBP, in writing, of the
intention of Topps or such other entity to sell or otherwise
distribute into any such New Foreign Jurisdiction, together with a
description of the Baseball Items and/or Topps Products to be sold or
distributed, projected volume of such items to be sold or distributed
into such New Foreign Jurisdiction and the name of the Topps
distributor for such New Foreign Jurisdiction. Topps shall, to the
extent reasonably practicable, provide such notice at least twenty
(20) days prior to such distribution or sale. MLBP shall then notify
Topps, in writing and within fifteen (15) days of its receipt of Topps
notice, as to whether the Insignia have been registered with the
relevant trademark authorities in such New Foreign Jurisdiction. If
the Insignia have not been so registered, neither Topps nor any entity
directed by, or under agreement with, Topps to distribute or sell the
Baseball Items or Topps Products in such New Foreign Jurisdiction
unless Topps agrees to indemnify MLBP, the BOC, the Leagues and the
Baseball Clubs from any third party trademark or other intellectual
property claims brought as a result of such sales or distribution in
such New Foreign Jurisdiction. MLBP shall provide Topps with a list of
all countries in which the Insignia are currently registered, as
promptly as reasonably practicable after the date hereof.
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5. During each calendar year of the term of the 2001 Amendment,
Topps shall pay to MLBP minimum guarantees, against sales of
Baseball Items and Topps Products in the United States, its
territories, possessions and military bases worldwide, Puerto
Rico and Canada as set forth on Schedule A attached hereto.
There shall be no minimum guarantees for any other
jurisdiction.
6. During each calendar year of the term of the 2001 Amendment commencing
with the Effective Date, Topps shall pay to MLBP royalties on the net
sales of Baseball Items and Topps Products (as those terms are defined
in Paragraph 1 of the License Agreement), as set forth on Schedule A
attached hereto. [information subject to confidential treatment]
Notwithstanding the above, Topps shall not be entitled to reduce its
normal selling price to fund retailer or wholesaler advertising. In
addition, in the event Topps sells any Baseball Items or Topps
Products at a price less than 50% of its normal selling price, for
purposes of calculating the royalty payable to MLBP, the sales price
of such item shall be 50% of the normal selling price. For purposes of
this Paragraph, "normal selling price" shall mean the regular gross
selling price at the time for that class of trade. The calculation of
net sales shall include all items sold by Topps together in its retail
packs with Baseball Items and Topps Products. No cost incurred in the
manufacture, sale, distribution, promotion or advertisement of the
Baseball Items or Topps Products shall be deducted from any royalties
payable by Topps. The minimum guarantees payable hereunder shall be
paid as provided in Schedule A except to the extent that cumulative
payments of royalties for sales in the United States, its territories,
possessions and military bases worldwide, Puerto Rico and Canada shall
theretofore have offset all or a portion of the total of such minimum
guarantees. In addition, Topps shall receive a dollar-for-dollar
credit against the minimum guarantee payable during each calendar year
of the 2001 Amendment for all royalties paid for sales of Baseball
Items and Topps Products during that year outside of the United
States, its territories, possessions and military bases worldwide,
Puerto Rico and Canada. Any late payments by Topps shall require Topps
to pay MLBP, in addition to the amounts due, interest at one percent
(1%) per month or the highest prime lending rate of Chemical Bank (or
its successor) during the period such amounts are delinquent,
whichever is greater, on the amounts delinquent for the period of
delinquency, without prejudice to any other rights of MLBP in
connection therewith. All royalties shall be payable on or by March 15
of each year for the immediately preceding calendar year, with a
credit for the minimum guarantee theretofore paid for such preceding
calendar year.
7. Topps shall provide to MLBP a merchandise credit in the form of three
(3) cases for each product release of each Baseball :Item during each
year of the term commencing on or after the Effective Date Topps shall
ship, at MLBP's direction, such merchandise as MLBP shall request from
time to time pursuant to the merchandise credit.
8. During each calendar year of the term, Topps shall, subject to the
parties agreeing to and executing a mutually acceptable sponsorship
agreement, participate in the Major League Baseball All-Star FanFest
as a participating sponsor. The sponsorship fee shall be [information
subject to request for confidential treatment] for each of 2001, 2002,
2003 and 2004.
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9. During each calendar year of the term commencing on or after the
Effective Date, Topps shall purchase a one page full-color
advertisement in each of Little League Magazine produced during each
year of the term commencing on or after the Effective Date, provided
that Topps shall not be required to spend in excess of $[information
subject to request for confidential treatment] in any such year for
such advertisements.
10. During each calendar year of the term commencing on or after the
Effective Date, Topps shall give good faith consideration to
participating in at least two mutually agreed upon MBLP-sponsored
events (e.g. National Packtime).
11. During each calendar year of the term commencing on or after the
Effective Date, Topps shall spend, on mutually agreed upon retail
initiatives involving trading cards, the amount of $[information
subject to request for confidential treatment].
12. Topps shall give good faith consideration to participating in,
sponsoring and/or supporting certain youth-oriented MBLP
events.
13. The following shall be added to the License Agreement immediately
after the word "giveaways" in Paragraph 2 of the 1969 Agreement.
"(except for giveaway programs for sticker albums in a manner designed
to promote and market Major League Baseball sticker collections and
approved by MLBP)."
14. The License Agreement is amended by deleting in its entirety Paragraph
5 of the 1969 Letter Agreement dated June 25, 1990, and that certain
1969 Letter Agreement dated August 16, 1990, and replacing it with the
following:
"5. It is understood that the samples to be provided to MLBP by Topps
pursuant to Paragraph 5 of the License Agreement are to be submitted
for the purpose of MLBP approving the quality of the samples,
particularly the accuracy of all Insignia used in connection with
baseball Items and Topps Products. [information subject to request for
confidential treatment]. The term "MLBP business days" as used in this
Paragraph shall mean all days on which banks are authorized to close
in New York State and other MLBP holiday of which MLBP advises Topps
at least thirty days in advance.
15. Topps shall comply with the guidelines set forth on Schedule B in
publishing the Baseball Items and Topps Products.
16. On each September 30 of the term after the Effective Date, Topps shall
submit to MLBP, for MLBP's information, Topps marketing information
required by Schedule C hereto for the next succeeding calendar year of
the term.
17. Topps shall provide MLBP with notice (for informational purposes
only), simultaneously with the submissions in Paragraph 14 hereof and,
whenever practicable, in the marketing plans provided by Topps
pursuant to Schedule C, of any new brand of Baseball Items including
without limitation, Trading Cards, it intends to publish using the
Insignia in accordance with the License Agreement.
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18. Topps hereby agrees to indemnify, defend and hold MLBP, the BOC, the
Leagues and the Baseball Clubs and their respective owners
shareholders, directors, officers, employees, agents, representatives,
successors and assigns harmless from any claims, suits, damages and
costs (including reasonable attorney's fees and expenses) arising out
of any claim by a third party in connection with: (i) any use of or
infringement of any trademark, service xxxx, copyright, patent,
process, method or device by Topps during the term in connection with
the Baseball Items or Topps Products covered by the License Agreement,
other than a use of the Insignia as authorized under the License
Agreement; (ii) alleged defects or deficiencies arising during or
after the term (A) in Baseball Items published by or on behalf of
Topps, (B) in Topps Products or (C) in the wrappings, packaging
materials or advertising materials of Topps used or sold in connection
with the Baseball Items or Topps Products, or in the use thereof, or
false advertising, fraud, misrepresentation or other claims related to
the Baseball Items not involving a claim of right to the Insignia;
(iii) use of the Insignia during the term, other than as authorized by
the License Agreement, or any breach by Topps of the License
Agreement; (iv) invasion of the right of privacy, publicity or
property of, or violation or misappropriation of any other rights of
any third party during the term, other than as authorized by the
License Agreement; (v) libel or slander against any third party
arising during the term; and (vi) agreements or alleged agreements
entered into Topps with a third party for the manufacture,
distribution or sale of Baseball Items or Topps Product, provided in
each case Topps shall have the option to undertake and conduct the
defense of any suits brought and to engage in settlement thereof at
its sole discretion, provided such settlement does not impair the
legal rights of MLBP. MLBP shall give Topps written notice of the
making of any claim or the institution of any action hereunder and
MLBP may, at its option, participate in any action. The
indemnifications hereunder shall survive the expiration or termination
of the License Agreement.
19. MLBP represents and warrants to Topps that it has all necessary rights
and authority to grant the license granted hereunder, and agrees to
indemnify (subject to any indemnification provided by Topps in
accordance with Paragraph 4 hereof), defend and hold Topps and its
stockholders, directors, officers, employees, agents, representatives,
successors and assigns harmless from any claims, suits, damages and
costs (including reasonable attorney's fees and expenses) arising out
of any claim by a third party in connection with: (1) challenges,
during or after the term, to MI-BP's authority and power as agent for
and pursuant to the authority granted by the BOC, the Leagues and the
Baseball Clubs to license the Insignia in connection with the
manufacturing, distribution, advertisement and sale of the Baseball
Items; and (ii) Topps authorized use of the Insignia as approved by
MLBP under the License Agreement (which includes, but shall not be
limited to, any claims relating to MLBP's failure or alleged failure
to have the right to grant the licenses granted hereunder), provided
in each case that MLBP shall have the option to undertake, review and
conduct the defense of any suit so brought and to engage in settlement
thereof at its sole discretion, provided such settlement does riot
impair any legal rights which Topps may have outside of the License
Agreement. Topps shall not institute any suit or action with respect
to the Insignia against any individual or entity that does not own any
of the Insignia without first obtaining MLBP's consent. Topps agrees
that it is not entitled to share in any proceeds received by MLBP (by
settlement or otherwise) in connection with any formal or informal
action relating to the Insignia brought by MLBP or any other owner of
any of the Insignia, provided that nothing contained herein shall
limit Topps rights to prosecute claims to the extent such claims
relate to Topps own trademarks, copyrights and other intellectual
property. Topps shall give MLBP written notice of the making of any
claim or the institution of any action hereunder and Topps may, at its
option, participate in any action. The representations and
indemnifications hereunder shall survive the expiration or termination
of the License Agreement.
Notwithstanding the foregoing, in the case of Paragraphs 18 and 19
hereof, no settlement should impose a monetary liability on a party
without such party's prior written consent, such consent not to be
unreasonably withheld.
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20. Topps agrees that, during the term of the 2001 Amendment:
(a) It will not acquire any rights in the Insignia as a result of its
use under Paragraph 1(b) of the License Agreement;, and all use
of the Insignia under Paragraph 1(b) of the License Agreement
shall inure to the benefit of MLBP, the BOC, the Leagues and/or
the Baseball Clubs.
(b) It will not directly attack the title of MLBP, the Baseball
Clubs, the Leagues, and/or the BOC in and to the Insignia or any
copyright, trademark or service xxxx pertaining thereto, nor will
it directly attack the validity of the license granted hereunder.
(c) It will not apply for any registration of any copyright,
trademark, service xxxx or other designation which would directly
affect the ownership of the Insignia.
(d) It will comply with all laws and regulations applicable to the
manufacture, sale or advertising of the Baseball Items and
Topps Products and shall comply with the applicable
requirements of any governmental agency (including, without
limitation, the United States Consumer Safety Commission)
which shall have jurisdiction over the Baseball Items and
Topps Products.
(e) It shall ensure that MLBP, the Baseball Clubs, official Club
and/or MLBP retail stores, Club in-stadium concessionaires and
the Clubs belonging to The National Association of Professional
Baseball Leagues ("NAPBL Clubs") may obtain Baseball Items and
Topps Products, without regard to the relatively small volume
their orders may represent, to the extent supplies last. MLBP,
the Clubs and NAPBL Clubs may obtain the Baseball Items and Topps
Products for their use, but not for resale, at the lowest price
at which Topps sells the Baseball Items and Topps Products.
21. The License Agreement is amended by deleting in their entirety
Paragraphs 6, 7 and 8 of the 1969 Agreement as heretofore effected by
Paragraph 22 of that Letter Agreement dated September 28, 1995.
22. Upon MLBP's written request:, but not more than twice during any
calendar year, Topps shall provide MLBP with a written list of the
name of each third party (hereinafter, a "Manufacturer"), both
domestic and foreign, that Topps has used to produce any of the
Baseball Items or Topps Products during the preceding 12-month period
and those it is currently using or has plans to use. In the event MLBP
notifies Topps that it has encountered difficulties with respect to
the unlawful use of the Insignias by any such Manufacturer (or any
other manufacturer which MLBP shall so advise Topps with respect to),
Topps agrees to give good faith consideration, using its reasonable
business judgment exercised in its sole discretion, as to whether to
continue to do business with such third party.
23. Topps will not manufacture, or authorize the manufacture of the
Baseball Items or Topps Products, or accumulate inventory, at a rate
greater than its average rate during the term, as the end of the term
approaches.
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24. Neither MLBP nor Topps shall disclose any confidential, private,
restricted or otherwise non-public information concerning the other
(including, without limitation, Topps marketing plans and the list of
Manufacturers) which, it acknowledges, it may become privy to during
the term of the 2001 Amendment, except as required by law and except
that MLBP may divulge such information to the BOC, the Leagues and the
Baseball Clubs, provided that the BOC, the Leagues and the Baseball
Clubs are subject to a confidentiality agreement with MBLP, and Topps
is a third-party beneficiary thereof.
25. Topps agrees to obtain, at its own cost and expense, comprehensive
general liability insurance including product liability insurance
providing adequate protection for MLBP, the BOC, the Leagues and the
Baseball Clubs and Topps in an amount not less than $3,000,000.00
(three million dollars) per incident or occurrence (which amount may
include excess umbrella coverage), or Topps standard insurance policy
limits, whichever include excess umbrella coverage), or Topps standard
insurance policy limits, whichever is greater, and with a reasonable
deductible in relation thereto from an insurance company rated at
least A- by A.M. Best. Such insurance shall remain in force at all
times during the license period and for a period of five (5) years
thereafter. Topps further agrees that as long as such insurance is
available from an insurance company rated at least A- by A.M. Best, to
obtain and maintain adequate insurance covering claims of third
parties against MLBP, the BOC, the Leagues and the Baseball Clubs and
Topps, relating to the matters described in Subparagraphs 18(iv), (v)
and (vi), in an amount equal to the lesser of (a) $1,000,000 per
incident or occurrence and 51,000;000 in the aggregate, and (b) such
amount as may be obtained for an annual premium of 525.000. Within
thirty (30) days from the date hereof, Topps will submit to MLBP a
certificate of insurance naming MLBP and the Baseball Clubs as
additional insured parties and requiring that the insurer shall not
terminate or materially modify such policy or certificate of insurance
without written notice to MLBP at least thirty (30) days in advance
thereof.
26. Topps shall furnish to MLBP complete and accurate statements during
the period commencing on January 1, 2001 through December 31, 2002 on
a quarterly basis and during the period commencing on January 1, 2003
through December 31, 2004 on a monthly basis, certified to be accurate
by an officer on behalf of Topps, showing the sales volume of each
Baseball Item, gross sales price, itemized deductions from gross sales
price, and net sales price of the Baseball Items distributed and/or
sold by Topps during the preceding quarter or month, as applicable.
Upon the reasonable request of MLBP, Topps shall provide additional
information necessary to clarify the royalty reports. Such statements
shall be furnished to MLBP whether or not any of the Baseball Items
have been sold, or any payment is shown to be due MLBP. Receipt or
acceptance by MLBP of any of the statements furnished pursuant to the
License Agreement or of any sums paid hereunder shall not preclude
MLBP from questioning the correctness thereof at any time, and in the
event that any inconsistencies or mistakes are discovered in such
statements or payments, they shall immediately be rectified and the
appropriate payments made by Topps. Late payment penalties, if any,
shall be made pursuant to Paragraph 6 hereof.
Topps shall account separately for all sales in each country. For
reporting purposes, the United States of America, the District of
Columbia, Puerto Rico and U.S. territories and possessions, including
U.S. military bases worldwide, shall be one country.
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27. Topps shall keep, maintain and preserve in its principal place of
business for at least two (2) years following termination or
expiration of the License Agreement or any renewal thereof complete
and accurate records and accounts covering all transactions relating
to the License Agreement. Such records and accounts shall be available
for inspection and audit no more than twice during any year of the
term of the License Agreement during reasonable business hours and
upon reasonable notice by MLBP or its representatives. Except as
otherwise required by law, MLBP shall keep the information derived
from any audit in confidence. If pursuant to its right hereunder to
audit and inspect MLBP causes an audit and inspection to be instituted
and thereafter discloses a deficiency of three percent (3%) or more
between the amount found to be due to MLBP pursuant to Schedule A
hereto and the amount actually paid or credited to MLBP, then Topps
shall be responsible for payment of the entire deficiency together
with interest: thereon at the then current prime rate of Chemical Bank
(or its successor) from the date such amount became due until the date
of payment, and the costs and expenses of such audit: and inspection.
28. As heretofore effected by Paragraph 29 of that Letter Agreement dated
September 28, 1995, the License Agreement is amended by deleting in
its entirety Paragraph 6 of the Letter Amendment dated June 25, 1990
and replacing it with the following:
"6. On the packaging of all Baseball Items and Topps Products shall
appear one of the following two notices: "The Major League Baseball
Club Insignia depicted on this product are trademarks which are the
exclusive property of the respective Major League Clubs and may not be
reproduced without their written consent" or "Major League Baseball
trademarks and copyrights are used with permission of Major League
Baseball Properties, Inc." MLBP shall, in its discretion and in a
timely manner, determine which notice to include in each Baseball Item
and Topps Product. In addition, on all products containing the
Insignia shall appear a label stating "Genuine Merchandise" and
containing the Major League Baseball silhouetted batter logo. Further,
all Topps advertisements and promotional displays featuring the
Insignia and all retailer advertisements featuring Baseball Items or
Topps Products. and of which Topps has knowledge, shall contain the
worlds "Genuine Merchandise" and the silhouetted batter logo, and all
uses of the Insignia shall include either of the following notices are
directed by MLBP: (R) or "TM". MLBP shall have the right to revise the
foregoing notice requirements and to require such other notices as
shall be reasonably necessary to protect the interests of the MLBP,
the Baseball Clubs, the BOC, and/or the Leagues and their respective
Insignia. Topps agrees to advise MLBP of the initial date of the
marketing of each Baseball Item and Topps Product and upon request to
deliver to MLBP up to eight (8) retail packages of the Baseball Items
and Topps Products upon which the Insignia are used."
29. In any case where Topps employs the services of photographers or
artists in connection with the production, promotion, marketing or
distribution of the Baseball Items and Topps Products, it shall ensure
that each such photographer complies with the terms and conditions of
credentials, as issued, and shall use reasonable efforts to secure the
agreement from each such photographer or artist that the photographic
or artistic work he or she produces for Topps shall be "works made for
hire" for the purposes of the copyright laws, and that to the extent
such photographic or artistic works may not qualify as works made for
hire, the copyright in each such work is assigned to Topps. Nothing
contained herein shall prohibit Topps from using any photographer or
artist that does not enter into such an agreement.
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30. (a) MLBP shall have the right to terminate the License Agreement upon
the occurrence of any one more of the following events (herein called
"defaults"):
(i) If Topps failed to maintain in full force and effect the
insurance referred to in the first sentence of Paragraph 25
hereof and fails to provide for similar protection in form
and manner reasonably acceptable to MLBP (which may include,
if reasonable acceptable to MLBP, self-insurance) so that
there is coverage at all times. The downgrading of Topps
insurer by A.M. Best shall not be deemed a default, provided
that Topps may not sign a new policy with such down-graded
insurer.
(ii) If Topps shall breach any one of the undertakings set forth
in Paragraph 20 (a)-(c) hereof or any other material term of
the License Agreement, and shall fail to cure such -breach
to the extent reasonably capable of cure, within thirty (30)
days of MLBP's written notice of breach to Topps thereof. In
the event any such breach is not capable of cure, MLBP may
only terminate the License Agreement in the event Topps has
persisted, notwithstanding prior written notice of such
breaches from MLBP to Topps, to engage in such conduct.
Termination by MLBP under this Subparagraph shall be
effective ninety (90) days after the delivery of written
notice of termination by MLBP, which may be given only upon
the expiration of the thirty (30)-day cure period.
(iii)In the event a majority or controlling interest in Topps is
acquired by a person or entity that was or is connection
with casinos or any other form of legalized gambling
enterprise, or gambling in any manner, MLBP may terminate
the License Agreement immediately by written notice to
Topps.
(iv) If Topps is unable to pay its debts when due, or makes any
assignment for the benefit of creditors or any arrangement
pursuant to any bankruptcy law, or files or has filed
against it any petition under the bankruptcy or insolvency
laws of any jurisdiction, county or place, or shall have or
suffer a receive or trustee to be appointed for its business
property, or be adjudicated a bankrupt or insolvent. In the
event the license granted hereunder is terminated pursuant
to this Paragraph 30(a)(iv), neither Topps nor its
receivers, representatives, trustees, agent, administrators,
successor and/or assigns shall rely on the terms of the
License Agreement for any rights to sell, exploit or
otherwise deal with or in the Baseball Items and Topps
Products without the prior written consent of MLBP.
(v) If Topps fails to pay any royalties or guaranteed minimums
due hereunder and Topps fails to cure such breach within
fifteen (15) days after written notice thereof from MLBP,
unless such failure is due to a good faith dispute between
the parties with respect to such payment.
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(b) In the event any of these defaults occur and MLBP desires to
exercise its right of termination under the terms of this
Paragraph 30, MLBP shall give notice of termination in writing to
Topps. Upon termination or expiration of the term hereof, all
rights, licenses and privileges granted to Topps hereunder shall
automatically revert to MLBP and Topps shall execute any and all
documents evidencing such automatic reversion. Upon any
termination under Paragraph 30(a)(ii) resulting from a default by
Topps, Topps shall be required to pay [information subject to
request for confidential treatment] (in addition to any other
damages, costs or expenses which may be awarded to MLBP as a
result of such default') and [information subject to request for
confidential treatment]. For any other termination in minimum
guarantee for any subsequent periods. For any other termination
in accordance with this Paragraph 30, Topps shall be required to
pay [information subject to request for confidential treatment].
Subject to the limitation of the minimum guarantee termination
payments set forth in the two preceding sentences, MLBP's right
to terminate this Agreement, and the termination payments called
for in this Paragraph and the right to seek any remedies related
to such termination, shall be without prejudice to any other
rights or remedies which MLBP may have, whether under the
provisions of the License Agreement, in law or in equity or
otherwise.
(c) Topps shall have the right to terminate this Agreement
immediately upon written notice to MLBP in the event MLBP ceases
to have the ability to license to Topps a material portion of the
rights to be licensed to Topps hereunder for the United States or
Canada (unless such rights have been assigned to another entity
which assumes the License Agreement, without substantive
modification).
(d) Topps shall have the right to terminate this Agreement upon
ninet-v (90) days' written notice to MLBP (which may be given
only upon expiration of the 30-day cure period) if MLBP breaches
any material term of the License Agreement and fails to cure such
breach, to the extent such breach is reasonably capable of cure,
within thirty (30) days after written notice thereof from Topps
to MLBP. In the event any such breach is not reasonably capable
of cure, Topps has persisted, notwithstanding prior written
notice of such breaches from Topps to MLBP, to engage in such
conduct.
Notwithstanding the foregoing, Topps may not terminate this
License Agreement under Paragraph 30(d) to the extent Paragraph
30(c) is applicable to the breach. Any termination under
Paragraph 30(c) or Paragraph 30(d) shall be without limitation or
prejudice to any other rights Topps may have, whether under the
provisions of the License Agreement, in law or in equity or
otherwise.
10
31. Topps shall deliver to MLBP, as soon as practicable, following
expiration or termination of the Licensing Agreement, a statement
indicating the number and description of the Baseball Items and Topps
Products on hand. Following expiration or termination, Topps may not
rely on the License Agreement to manufacture, sell or otherwise
distribute any more Baseball Items or Topps Products, but may continue
to distribute its remaining inventory for a period not to exceed sixty
(60) days, subject to the items of Paragraph 23 hereof and payment of
applicable royalties relative thereto; provided, however, that such
royalties shall not be applicable against minimum guarantees
hereunder. MLBP shall have the option to conduct physical inventories
before termination and continuing until the end of the sixty (60)-day
sell-off period in order to ascertain or verify such inventories
and/or statement. immediately upon expiration of the sell-off period,
Topps shall furnish MLBP with a detailed statement certified by an
officer on behalf of Topps showing the number and description of
Baseball Items and Topps Products on hand in its inventory and shall
dispose of such inventory at MLBP's direction and at Topps expense. In
the event Topps refuses to permit MLBP to conduct such physical
inventory, Topps shall forfeit its right hereunder to dispose of such
inventor. In addition to such forfeiture, MLBP shall have recourse to
all other remedies available to it.
32. All notices required to be given under the License Agreement to a
party shall be in writing and shall be deemed duly given if personally
delivered or mailed by certified or registered mail, return receipt
requested, to the party concerned as follows:
If to MLBP:
Xxxxx Xxxxxxxx
Senior Vice President and General Counsel
Major League Baseball Properties, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
With a copy to:
Xxxxx Xxxxx
Vice President, Domestic Licensing, Trading Cards, Collectibles.
Memorabilia & Cooperstown
Major League Baseball Properties, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
If to Topps:
Xxxxxx X. Xxxxxx
Chairman of the Board and Chief Executive Officer
The Topps Company, Inc.
Xxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
With copies to:
Xxxxxx Xxxxx, Esq.
Vice President and General Counsel and Controller
The Topps Company, Inc. The Topps Company, Inc.
Facsimile: (000) 000-0000 Facsimile: (000) 000-0000
Notice may also be sent by facsimile if followed by another
method of delivery as described above.
11
33. No waiver, modification or cancellation of any term or condition of
the License Agreement shall be effective unless executed in writing by
the party charged therewith. No written waiver shall excuse the
performance of any act other than those specifically referred to
therein. No waiver by either party hereto of any breach of the License
Agreement shall be deemed to be a waiver of any preceding or
succeeding breach of the same or any other provision hereof. The
exercise of any right granted to either party hereunder shall not
operate as a waiver. The normal expiration of the term of the License
Agreement shall not relieve either party of its respective rights of
either party against the other, which rights by their nature survive
such expiration. Neither party makes any representations or warranties
to the other, except as expressly set forth herein.
34. The License Agreement does not constitute and shall not be construed
as constituting an agency, partnership or joint venture relationship
between Topps and MBLP. Neither party shall have any right to obligate
or bind the other in any manner whatsoever, and nothing herein
contained shall give or is intended to give any rights of any kind to
any third persons.
35. As heretofore affected by Paragraph 26 of that Letter Agreement dated
September 28, 1995 the License Agreement is amended by deleting in its
entirety Paragraph 11 of the 1969 Agreement and replacing it with the
following:
"The License Agreement shall be construed and enforced in accordance
with the laws of the State of New York, without giving effect to
principles of conflicts of laws, and cannot be changed orally."
36. This 2001 Amendment, including the original 1969 Agreement (dated
January 1, 1969) and all prior amendments, and the attached Schedules,
when fully executed, shall represent the entire understanding between
the parties hereto with respect to the subject matter hereof.
37. Except as expressly amended and extended by this 2001 Amendment; the
License Agreement including, without limitation, Section 9 of the 1969
Agreement, shall remain unamended and in full force and effect.
38. The License Agreement may not be assigned by Topps without the prior
written consent of MLBP. MLBP may assign this Agreement to an
affiliate, successor, or related entity, upon notice to Licensor.
Please indicate your agreement to the foregoing terms by signing
below.
Sincerely,
Xxxxxx X Xxxxx
Vice President-General Counsel
AGREED AND ACCEPTED:
MAJOR LEAGUE BASEBALL PROPERTIES, INC.
BY: _________________________________
SCHEDULE A
1. Minimum Guarantee
The minimum guarantee is $[information subject to request for
confidential treatment] per calendar year, for the United States, its
territories, possessions and military bases worldwide, Puerto Rico and
Canada, payable in equal installments of $[information subject to
request for confidential treatment] on each April 15, July 15 and
October 15 during the term. There is no minimum guarantee for any
other jurisdiction.
2. Royalty
The royalty for calendar yeas s 2001, 2002, 2003 and 2004 shall be:
(a) [information subject to request for confidential treatment]% on
the first $[information subject to request for confidential
treatment] in net sales for each year;
(b) [information subject to request for confidential treatment]% of
net sales exceeding $[information subject to request for
confidential treatment], but not exceeding $[information subject
to request for confidential treatment] for each year; and
(c) [information subject to request for confidential treatment]% of
net sales in excess of $[information subject to request for
confidential treatment] for each year.
All royalties shall be paid by March 15 for the immediately preceding
calendar year, with a credit for the minimum guarantee theretofore
paid for such preceding year.
SCHEDULE B
1. The team name or Club Logo shall be featured in a prominent and
visible manner. on the front or back of each regular player Trading
Card, separate from any use of the team name in statistical or
editorial information contained on the card.
2. The team name and Club Logo must be separate and distinct from the
player's name and any corporate identification (including, without
limitation, that of Topps) featured on any Baseball Item.
3. The Major League Baseball silhouetted batter logo shall appear in a
visible manner on each Trading Card, in no smaller type size than the
MLBPA logo on such Trading Card.
4. Each pack of trading cards must specify the number of cards contained
therein, if and as required by law.
SCHEDULE C
MLBP 200_ MARKETING PLAN REQUEST
"=============================================================================="
" Demographics (3-year Trends) ' Brand Data "
" HH Penetration; ' Baseball Card Brand Trends "
" Kid HH Penetration ' --Unit Volume; Volume Net Sales "
" ' --Distribution by Brand/Channel "
"----------------------------------'---------------- --------------------------"
" Brand Positioning ' Volume(Unit/Net Sales) 5 Year History 200_"
" --Each Brand's Reasons for Being ' Estimate (This will be provided on a one- "
" Target ' time basis for this year.) 3 year "
" Attributes ' projections (only to the extent Topps "
" Price Point ' prepares such projections). "
" Channel Focus ' "
" ' Shipments "
" ' Returns "
"------------------------------------------------------------------------------"
" ' Marketing Plan "
" ' --Core Consumer Target "
" ' --Objectives and Strategies for 200_ "
" ' --Major Consumer Programs "
" ' --Major Retail Programs "
" ' --New Product Introductions "
" ' --Technological Innovations "
" ' --International Plans "
"=============================================================================="
