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[Major League Baseball Logo]
Contract No. ML-2029B
MAJOR LEAGUE BASEBALL PROPERTIES, INC.
LICENSE AGREEMENT
THIS LICENSE AGREEMENT by and between Major League Baseball Properties,
Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000 (hereinafter referred to as
"Licensor"), as agent for the Major League Baseball Clubs (the "Clubs"), and
Starter Corporation, 000 Xxxxx Xxxxxx, Xxx Xxxxx, XX 00000 (hereinafter referred
to as "Licensee"). This Agreement is not effective until signed by the parties
hereto.
THIS WILL CONFIRM OUR AGREEMENT AS FOLLOWS:
1. GRANT OF LICENSE: Licensor grants to Licensee for the term of this
Agreement, subject to the terms and conditions hereinafter contained, the
non-exclusive license to utilize the names, characters, symbols, designs,
likenesses and visual representations described in Schedule A attached hereto
(herein such names, characters, symbols, designs, likenesses and visual
representations are collectively called "Logos"), to be used solely in
connection with the manufacture, distribution, promotion, advertisement and sale
of the article or articles specified in Schedule B attached hereto (herein such
article or articles are called "Licensed Product(s)"). This license does not
constitute and may not be used so as to imply the endorsement of the Licensed
Product(s) or any other product of Licensee by Licensor, the Office of the
Commissioner of Baseball, the American or National League of Professional
Baseball Clubs (hereinafter referred to as the "Leagues") or the Clubs. While
the Logos licensed herein may be used as trademarks subject to the terms of this
License Agreement, the Logos are not licensed herein for use as certification
marks or indications of a particular standard of quality. Any exclusivity
granted hereunder shall be subject to presently outstanding agreements granted
by the Clubs. Further, any exclusivity granted hereunder shall pertain only to
the extent of the items described and, if given, at the price set forth in
Schedule E. Licensor warrants and represents that as the agent for the Clubs,
pursuant to authority granted by the Clubs, it has the full authority to
license the Logos in connection with the manufacture, distribution, promotion,
advertisement and sale of the Licensed Product(s).
2. TERRITORY: Licensee shall be entitled to use the license granted
hereunder only in the territory described in Schedule C attached hereto (herein
such territory is called "Licensed Territory"). Licensee will not make use of or
authorize any use of this license or the Licensed Product(s) outside the
Licensed Territory or distribute or sell the Licensed Product(s) directly or
through others to retailers outside the Licensed Territory.
3. LICENSE PERIOD: The license granted hereunder shall be effective and
terminate as of the dates specified in Schedule D attached hereto, unless
sooner terminated or renewed in accordance with the terms and conditions hereof.
4. PAYMENT: A. Advance and Guaranteed Compensation: Licensee agrees to pay
Licensor the sums specified in Schedule E attached hereto, as advance minimum
compensation (herein called "Advance Compensation") and as guaranteed minimum
compensation (herein called "Guaranteed Compensation"). The Advance Compensation
shall be paid as set forth in Schedule E, and shall apply against Percentage
Compensation as defined below. The Guaranteed Compensation shall be paid as
provided in Schedule E except to the extent that paid Advance Compensation and
annual cumulative payments of Percentage Compensation shall theretofore have
offset all or a portion of the total of such Guaranteed Compensation.
Notwithstanding the foregoing, no part of Percentage Compensation which may be
attributable to premium sales (as defined hereunder) of the Licensed Product(s)
shall serve to offset any part of the Total Guaranteed Compensation specified in
Schedule E. No part of such Advance Compensation and no part of such Guaranteed
Compensation shall be repayable to Licensee in any event, except as is expressly
provided for herein.
B. Percentage Compensation: Licensee agrees to pay Licensor a sum equal to
the percentage specified in Schedule E (or Licensor's prevailing rate, if
greater) of all net sales (as defined below) by Licensee or any of its
affiliated, associated or subsidiary entities of the Licensed Product(s) covered
by this Agreement. (Such percentage of net sales is herein called "Percentage
Compensation.") Percentage Compensation shall be payable concurrently with the
periodic statements required in the following paragraph, except to the extent
offset by Guaranteed Compensation theretofore remitted. The term "net sales"
shall mean gross sales based on the wholesale price to the retail trade less
quantity discounts and actual returns, but no deduction shall be made for
uncollectible accounts, commissions, taxes, discounts other than quantity
discounts, such as cash discounts and discounts attributable to the issuance of
a letter of credit, or any other amount. No costs incurred in the manufacture,
sale, distribution, promotion or advertisement of the Licensed Product(s) shall
be deducted from any Percentage Compensation payable by Licensee. Said
Percentage Compensation shall also be paid by Licensee to Licensor on all
Licensed Product(s) (including, without limitation, any irregulars, seconds,
etc. distributed pursuant to the provisions of Paragraph 10 of this Agreement)
distributed by Licensee or any of its affiliated, associated or subsidiary
entities even if not billed or billed at less than usual net sales price for
such Licensed Product(s),
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and shall be based upon the usual net sale sprice for such Licensed Product(s)
sold to the trade by Licensee. Any late payments of Advance Compensation,
Guaranteed Compensation or Percentage Compensation shall require Licensee to pay
Licensor, in addition to the amounts due, interest at one percent (1%) per month
or the highest prime lending rate of Chemical Bank during the period such
amounts are delinquent, whichever is greater, on the amounts delinquent for the
period of the delinquency, without prejudice to any other rights of Licensor in
connection therewith.
C. Catalog Contribution: Licensee agrees that Licensor shall have the right
in its sole discretion and in a style and manner in which it chooses, to print
catalogs, sales sheets or brochures (hereinafter "catalogs") wherein
representative merchandise from licensees of Licensor shall be displayed. In
this regard, Licensee agrees it will purchase from Licensor, at prevailing
rates, but in no event more than $3,000 for each year during the license period,
a minimum of one page in every catalog published during the term of this
Agreement in order to promote the Licensed Product(s), unless Licensee's
purchase obligation is excused by Licensor in writing. Licensee shall promptly
pay all amounts due upon invoicing and shall timely furnish materials necessary
to the publication of the catalogs. All payments made by Licensee in connection
with the publication of the catalogs shall be in addition to all other payments,
and shall not be credited against Advance Compensation, Guaranteed Compensation
or Percentage Compensation otherwise required hereunder.
5. PERIODIC STATEMENTS: Within thirty (30) days after the first day of the
license period, and promptly on the 15th day of every calendar month thereafter,
Licensee shall furnish to Licensor complete and accurate statements, certified
to be accurate by Licensee, or if a corporation, by an officer of Licensee,
showing the sales volume of each Licensed Product (itemized by Club, for each
applicable Licensed Product), gross sales price, itemized deductions from gross
sales price, and net sales price of the Licensed Product(s) distributed and/or
sold by Licensee during the preceding calendar month, together with any returns
made during the preceding calendar month. Such statements shall be furnished to
Licensor whether or not any of the Licensed Product(s) have been sold, or any
payment is shown to be due Licensor, during the calendar months in which such
statements are due. Licensee shall furnish to Licensor sufficient background
information so as to make such statements intelligible to Licensor, and upon
request by Licensor, a complete list of Licensee's customers to whom Licensed
Product(s) have been sold. Licensor agrees that it will not by divulge said
customer list to any other licensee, to any other competitor licensing
organization, or to any competitor of Licensee. Receipt or acceptance by
Licensor of any of the statements furnished pursuant to this Agreement or of any
sums paid hereunder shall not preclude Licensor 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 Licensee. Late payment penalties, if any,
shall be made pursuant to Paragraph 4.B. Upon demand of Licensor, Licensee shall
at its own expense, but not more than once in any twelve (12) month period,
furnish to Licensor a detailed statement certified by an independent certified
public accounting firm approved by Licensor showing the sales volume of each
Licensed Product (itemized by Club, for each applicable Licensed Product), gross
sales price, itemized deductions from gross sales price and net sales price of
the Licensed Product(s) covered by this Agreement distributed and/or sold by
Licensee to the date of the Licensor's demand. All amounts payable pursuant to
this Agreement shall be in U.S. dollars only.
6. BOOKS AND RECORDS: Licensee shall keep, maintain and preserve in its
principal place of business for at least two (2) years following termination or
expiration of this Agreement or any renewal thereof, complete and accurate
records and accounts covering all transactions relating to this Agreement and
pertaining to the various items required to be shown on the statements to be
submitted by Licensee, including, without limitation, invoices, correspondence
and banking, financial and other records in Licensee's possession or under its
control. Such records and accounts shall be available for inspection and audit
(and copying at Licensor's expense) at any time or times during or after the
term or terms of this Agreement during reasonable business hours and upon
reasonable notice by Licensor or its representatives. Licensee agrees not to
cause or permit any interference with Licensor or representatives of Licensor in
the performance of their duties of inspection and audit.
The exercise by Licensor, in whole or in part or at any time or times, of
the right to audit records and accounts or of any other right herein granted,
the acceptance by Licensor of any statement or statements or the receipt and
deposit by Licensor of any payment tendered by or on behalf of Licensee shall be
without prejudice to any rights or remedies of Licensor and shall not estop or
prevent Licensor from thereafter disputing the accuracy of any such statement or
payment.
If pursuant to its right hereunder to audit and inspect Licensor causes an
audit and inspection to be instituted which thereafter discloses a deficiency of
three percent (3%) or more between the amount found to be due to Licensor and
the amount actually paid or credited to Licensor, then Licensee 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. If the audit discloses a deficiency of less than
three percent (3%) between the amount found to be due to Licensor and the amount
actually paid or credited to Licensor, and if the amount actually paid or
credited to Licensor plus the deficiency exceeds the Guaranteed Compensation for
the period covered by the deficiency, then Licensee shall pay Licensor the
amount of the deficiency plus interest as calculated above.
7. INDEMNIFICATIONS AND PROTECTIONS: A. Licensor hereby agrees to
indemnify, defend and hold Licensee and its owners, shareholders, directors,
officers, employees, agents, representatives, successors and assigns harmless
from any claims, suits, damages or costs (including reasonable attorneys fees
and expenses) arising from (i) challenges to Licensor's authority as agent for
and pursuant to authority granted by the Clubs to license the Logos in
connection with the manufacture, distribution, promotion, advertisement and sale
of the Licensed
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Product(s) or (ii) assertions to any claim of right or interest in or to the
Logos as authorized and used on the Licensed Products, provided in each case
that Licensee shall give prompt written notice, cooperation and assistance to
Licensor relative to any such claim or suit, and provided further in each case
that Licensor shall have the option to undertake and conduct the defense of any
suit so brought and to engage in settlement thereof at its sole discretion. The
indemnifications hereunder shall survive the the termination or expiration of
this Agreement.
B. Licensee shall assist Licensor at Licensor's expense and to the extent
necessary, in the procurement of any protection or to protect any of Licensor's
rights to the Logos, and Licensor, if it so desires and in its sole discretion,
may commence or prosecute any claims or suits in its own name or in the name of
Licensee or join Licensee as a party thereto. Licensee shall notify Licensor in
writing of any infringements or imitations by others of the Logos of which it is
aware. Licensor shall have the sole right to determine whether or not any action
shall be taken on account of such infringements or imitations. Licensee shall
not institute any suit or take any action on account of any such infringements
or imitations without first obtaining the written consent of Licensor to do so.
Licensee agrees that it is not entitled to share in any proceeds received by
Licensor (by settlement or otherwise) in connection with any formal or informal
action brought by Licensor hereunder.
C. Licensee hereby agrees to indemnify, defend and hold Licensor, the
Clubs, the Leagues and the Office of the Commissioner of Baseball and their
respective owners, shareholders, directors, officers, employees, agents,
representatives, successors and assigns harmless from any claims, suits, damages
and costs (including reasonable attorneys' fees and expenses) arising out of (i)
any unauthorized use of or infringement of any trademark, service xxxx,
copyright, patent, process, method or device by Licensee in connection with the
Licensed Product(s) covered by this Agreement, (ii) alleged defects or
deficiencies in said Licensed Product(s) or the use thereof, or false
advertising, fraud, misrepresentation or other claims related to the Licensed
Product(s) not involving a claim of right to the Logos, (iii) the unauthorized
use of the Logos or any breach by Licensee of this Agreement, (iv) libel or
slander against, or invasion of the right of privacy, publicity or property of,
or violation or misappropriation of any other right of any third party, and/or
(v) agreements or alleged agreements made or entered into by Licensee to
effectuate the terms of this Agreement. Licensor shall give Licensee notice of
the making of any claim or the institution of any action hereunder and Licensor
may at its option participate in any action. The indemnifications hereunder
shall survive the expiration or termination of this Agreement.
8. INSURANCE: Licensee agrees to obtain, at its own cost and expense,
comprehensive general liability insurance including product liability insurance
from an insurance company acceptable to Licensor, providing adequate protection
for Licensor, the Clubs, the Leagues, the Office of the Commissioner of Baseball
and Licensee against any claims or suits arising out of any of the circumstances
described in Paragraph 7C above for which insurer is able to provide insurance,
in an amount no less than $5,000,000.00 (five million dollars) per incident or
occurrence, or Licensee's standard insurance policy limits, whichever is
greater, and with a reasonable deductible in relation thereto. Such insurance
shall remain in force at all times during the license period and for a period of
five years thereafter. Within thirty (30) days from the date hereof, Licensee
will submit to Licensor a fully paid policy or certificate of insurance naming
Licensor, the Leagues and the Office of the Commissioner of Baseball 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 Licensor at least thirty (30) days in advance thereof.
9. COPYRIGHT AND TRADEMARK NOTICES AND REGISTRATIONS: Licensee further
agrees that in any instance wherein the Logos of the Clubs and/or the Leagues
are used, the following general notice shall be included (i.e., on the product,
on a label, on the packaging material or on a separate slip of paper attached to
the product): "The Major League Club insignias 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." Further, all products
containing the Logos shall contain a hangtag and label with Licensee's name
stating "Genuine Merchandise" and containing the Major League Baseball
silhouetted batter logo and, where appropriate, the Major League Baseball
Cooperstown Collection logo or Major League Baseball Authentic Diamond
Collection logo. All Licensed Product(s) shall contain a permanently affixed
label that displays Licensee's name. All Licensed Product(s) components which
bear any of the Logos (embroidered emblems, cloth or paper labels, hangtags,
etc.) shall be manufactured in-house by Licensee or shall be obtained only from
one or more suppliers officially authorized by Licensor to produce those
components. All Licensee advertisements displaying the Logos, all retailer
advertisements featuring Licensed Product(s) and of which Licensee has knowledge
or any Licensed Product(s), shall contain the words "Genuine Merchandise" and
the silhouetted batter logo. Licensee shall require those to whom it sells
Licensed Product(s) directly or indirectly to display the words "Genuine
Merchandise" (or such other appropriate notice as directed by Licensor) and the
silhouetted batter logo in all advertisements. All uses of the Logos shall also
include any designations legally required or useful for enforcement of
copyright, trademark or service xxxx rights (e.g., "(C),""(R)" or "TM").
Licensee shall submit a copy of its specifications for all of the above notices
(including copies of its artwork, layouts or mold blueprints) to Licensor for
its review. Licensor shall have the right to revise the above notice
requirements and to require such other notices as shall be reasonably necessary
to protect the interests of Licensor, the Clubs and/or the Leagues in the
respective Logos. Licensee agrees to advise Licensor of the initial date of the
marketing of each Licensed Product, and upon request, to deliver to Licensor the
required number and type of specimen samples of the Licensed Product, labels or
the like upon which the Logos are used for use in procuring copyright, trademark
and/or service xxxx registrations in the name of and at the expense of the
person, firm, corporation or other legal entity owning the Logos, in compliance
with any laws relating to copyright, trademark and service xxxx registrations.
Except to the extent set forth in any schedules attached to this Agreement,
Licensor, the Clubs and/or the Leagues shall be solely responsible for taking
such action as it or they deem appropriate to obtain such copyright, trademark
or service xxxx registrations for its or their Logos. If it shall be necessary
for Licensee to be the applicant to effect any such registrations, Licensee
shall and hereby does assign all of its rights in each such application and any
resulting registration to Licensor or any other appropriate owner thereof, and
further
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agrees to execute all papers necessary to effectuate and/or confirm such
assignments. Licensee shall perform all acts necessary and execute all documents
necessary to effectuate its registration as a user of the Logos where such
registration is needed.
Licensee also agrees that, in any case where it employs the services of
photographers or artists in connection with the production, promotion, marketing
or distribution of the Licensed Product(s), it will require each such
photographer or artist to agree that the photographic or artistic works he or
she produces for Licensee 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 Licensee.
10. APPROVALS: Licensor shall have absolute approval of the Licensed
Product(s) and of all packaging, advertising and promotional material at all
stages of the development thereof. Licensee agrees to furnish in a timely manner
to Licensor, free of cost, for its written approval as to quality and style,
designs of each Licensed Product and samples of each Licensed Product before its
manufacture, sale, promotion, advertisement or distribution, whichever first
occurs, and samples of all advertising, point-of-sale displays, catalogs, sales
sheets and other items that display or picture the Logos, and no such Licensed
Product or other such materials shall be manufactured, sold, promoted,
advertised or distributed by Licensee without such prior written approval. In
particular, no use of any Logo or Logos shall be made on stationery of Licensee
(specifically including, without limitation, letterhead, envelopes, business
cards, shopping bags, invoices, statements, packing slips, etc.) without
Licensor's express written approval in advance of any such use. In addition, no
irregulars, seconds or other Licensed Products which do not conform in all
material respects to the approved samples may be distributed or sold without the
express written advance consent of Licensor. All such sales, if made, shall bear
Percentage Compensation as set forth in Paragraph 4.B. Subject, in each
instance, to the prior written approval of Licensor, Licensee or its agents may
use textual and/or pictorial matter pertaining to the Logos on such promotional
display and advertising material as may, in its judgment, promote the sale of
the Licensed Product(s). All promotional display and advertising material must
contain and prominently display the official logo of Licensor. Ten samples of
each Licensed Product shall be supplied free of cost to Licensor, and one to
each Club whose Logos are used on such Licensed Product(s). From time to time
subsequent to final approval, a reasonable number of production samples shall
periodically be sent to Licensor free of cost. Such samples shall also be sent
upon any change in design, style or quality, which shall necessitate subsequent
approvals by Licensor. Additional samples shall be supplied to Licensor upon
request at no more than cost. Licensor shall also have the right to inspect
Licensee's plants, warehouses or storage facilities at any reasonable time
without notice.
In the event that any item or matter submitted to Licensor under this
Agreement for approval or consent shall not have been approved or consented to,
disapproved or denied, or commented upon within twenty (20) Licensor business
days after receipt thereof by Licensor (both Licensing Director and Licensed
Product Compliance), and Licensor (both Licensing Director and Licensed Product
Compliance) shall have received notice from Licensee that comment is overdue by
telegram or other written communication, and Licensor shall not have commented
within five (5) additional Licensor business days of receipt of such notice, any
items or matters so submitted shall be deemed approved and consented to.
In any instance where any matter is required to be submitted to Licensor
for Licensor's approval, that approval shall be granted or withheld in
Licensor's sole discretion.
11. DISTRIBUTION: Licensee shall sell the Licensed Product(s) to jobbers,
wholesalers, distributors or retailers for sale or resale and distribution to
retail stores and merchants for their resale and distribution or directly to the
public. In the event Licensee sells or distributes a Licensed Product at a
special price directly or indirectly to itself, including, without limitation,
any subsidiary of Licensee, or to any other person, firm or corporation related
in any manner to Licensee or its officers, directors or major stockholders,
Licensee shall pay compensation with respect to such sales or distribution based
upon the price generally charged the trade by Licensee.
12. GOODWILL: Licensee recognizes the great value of the publicity and good
will associated with the Logos and, in such connection, acknowledges that such
good will belongs exclusively to Licensor, the Clubs, the Office of the
Commissioner of Baseball and/or the Leagues and that the Logos have acquired a
secondary meaning in the minds of the purchasing public.
13. SPECIFIC UNDERTAKINGS OF LICENSEE: During the license period, each
additional license period if any and thereafter, Licensee agrees that:
A. It will not acquire any rights in the Logos as a result of its use
thereof and all use of the Logos shall inure to Licensor's benefit;
B. It will not, directly or indirectly, attack the tide of Licensor, the
Clubs, the Office of the Commissioner of Baseball and/or the Leagues in and to
the Logos or any copyright, trademark or service xxxx pertaining thereto, nor
will it attack the validity of the license granted hereunder, nor will it use
the Logos in any manner other than as licensed hereunder;
C. It will not at any time apply for any registration of any copyright,
trademark, service xxxx or other designation which would affect the ownership of
the Logos, or file any document with any governmental authority or take any
action which would affect the ownership of the Logos or aid or abet anyone in
doing so;
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D. It will not harm, misuse or bring into disrepute the Logos;
E. It will manufacture, sell, promote, advertise and distribute the
Licensed Product(s) in a legal and ethical manner and in accordance with the
terms and intent of this Agreement;
F. It will not create any expenses chargeable to Licensor without the prior
written approval of Licensor;
G. It will protect to the best of its ability the right to manufacture,
sell and distribute the Licensed Product(s) hereunder;
H. It will not use the Licensed Product(s) for combination sales, as
self-liquidating or free giveaways or for any similar method of merchandising
without the prior written consent of Licensor and will exercise due care that
its customers likewise will refrain from making such use of the Licensed
Product(s);
I. It will not, without the prior written consent of Licensor, enter into
any sublicense or agency agreement for the manufacture, sale, promotion,
advertisement or distribution of the Licensed Product(s);
J. It will not engage in tying practices, illegal restraints of trade, or
selling practices that exclude any members of the retail trade for any reason
other than poor credit history, known lack of integrity or disregard for the
rights of Licensor or Major League Baseball. Nothing in the preceding sentence
shall be deemed to require Licensee to violate any other term of this Agreement;
K. It will not use, or knowingly permit the use of, the Licensed Product(s)
as a premium, except with the prior written consent of Licensor and the specific
negotiation of a higher royalty payment therefor. For purposes of this
subparagraph and Paragraph 19 below, the term "premium" shall be defined as
including, but not necessarily limited to, free or self-liquidating items
offered to the public in conjunction with the sale or promotion of a product or
service, including traffic building or continuity visits by the
consumer/customer, or any similar scheme or device, the prime intent of which is
to use the Licensed Product(s) in such a way as to promote, publicize and/or
sell the products, services or business image of the third party company or
manufacturer. "Premium" use shall also specifically include distribution of the
Licensed Product(s) for retail sale through distribution channels (including,
without limitation, catalogs) offering earned discounts or "bonus" points based
upon the extent of usage of the offeror's product or service;
L. It will comply with such guidelines and/or requirements as Licensor may
announce from time to time. It will comply with all laws, regulations and
standards relating or pertaining to the manufacture, sale, advertising or use of
the Licensed Product(s) and shall maintain the highest quality and standards,
and shall comply with the requirements of any regulatory agencies (including,
without limitation, the United States Consumer Safety Commission) which shall
have jurisdiction over the Licensed Product(s);
M. It guarantees that Licensor, Clubs, official Club and/or Licensor retail
stores, Club in-stadium concessionaires and the Clubs belonging to The National
Association of Professional Baseball Leagues ("NAPBL Clubs") will obtain the
Licensed Product(s) for retail sale at lowest possible wholesale prices and
shall receive prompt shipments and/or deliveries of the Licensed Product(s),
without regard to the relatively small volume their orders may represent.
Licensor, Clubs and NAPBL Clubs may obtain the Licensed Product(s) for their
use, but not resale, at the manufacturer's lowest possible price, which shall in
no event be greater than its lowest wholesale price;
N. It will furnish to Licensor, upon request of Licensor (which shall be
made only for reasonable cause and no more often than once per year), a list of
all its distributors, sales representatives and jobbers for the Licensed
Product(s), as well as a list of all its "trade names," said list to include the
company name, address, telephone number, territorial representation and key
contact name. Licensor agrees that it will not divulge any information provided
to it under this paragraph to any other competitor licensing organization;
0. Concurrently with its execution of this Agreement, it will provide
Licensor with the names, addresses, telephone numbers and names of principal
contacts of each party (hereinafter referred to as "Manufacturer"), both
domestic and foreign, that Licensee desires or intends to have produce one or
more of the Licensed Products in the event Licensee desires not to be the
manufacturer of such Licensed Product(s). This information shall be set out in
Schedule F of this Agreement and Licensee shall specify the Licensed Product(s)
Manufacturer will produce. In the event Licensee wishes to substitute a
Manufacturer for those listed in Schedule F or wishes to add to the number of
Manufacturers, Licensee shall first provide Licensor with the information set
out in Schedule F regarding the proposed new Manufacturers for Licensor's
written approval of such Manufacturers. Licensee's failure to do so may result
in termination of this Agreement and/or confiscation and seizure of the Licensed
Product(s). Licensee shall ensure that:
(a) Manufacturer produces no merchandise bearing the Logos other than
the Licensed Product(s) described in Schedule F of this Agreement unless
authorized by Licensor;
(b) Manufacturer produces the Licensed Product(s) only as and when
directed by Licensee and in accordance with the terms herein and in
compliance with all laws, regulations and governmental rules applicable to
the Licensed Product(s) and/or their manufacture;
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(c) Manufacturer does not supply the Licensed Product(s) to any
person, firm, corporation or business entity other than Licensee or to such
entities as may be authorized by Licensee and Licensor jointly; and
(d) Manufacturer does not delegate in any manner whatsoever its
obligations with respect to the Licensed Product(s).
Prior to the delivery of the Licensed Product(s) from Manufacturer to Licensee,
Licensee shall submit to Licensor, free of cost, for its written approval as to
quality and style, at least two samples of the Licensed Product(s) produced by
Manufacturer;
P. It will not manufacture or allow the manufacture, or accumulate
inventory, of the Licensed Product(s), at a rate greater than its average rate
during the license period as the end of the license period approaches;
Q. It will not sell the Licensed Product(s) to parties whom it knows or
reasonably should know will resell or distribute such Product(s) outside the
Licensed Territory;
R. It will not disclose any confidential, private, restricted or otherwise
nonpublic information concerning Major League Baseball which, it acknowledges,
it may become privy to during the term of this Agreement;
S. It will not grant to any third person or entity a security interest in
the Licensed Product(s) without Licensor's prior written approval;
T. It has not had and does not have an investment or interest in casinos,
any other form of legalized gambling enterprise, or any activity that Licensor
or any other Major League Baseball related entity has made unauthorized or which
is contrary to official policy of Major League Baseball; and
U. With respect to any Licensed Products manufactured outside the United
States, except as otherwise pre-approved in writing by Licensor, (i) it will
take receipt of goods at U.S. ports of entry, (ii) it will not allow any entity
in the United States, including but not limited to distributors, wholesalers and
retailers, to accept shipment of the Licensed Products from any non-U.S.
manufacturer of such Products, and (iii) it will distribute such Products to
third parties, including but not limited to distributors, wholesalers and
retailers, from Licensee's principal place of business only.
14. APPROVAL OF MANUFACTURER, ETC.: Nothing contained herein may be
construed so as to imply endorsement of Manufacturer by Licensor, the Office of
the Commissioner of Baseball, the Leagues or the Clubs. Licensee shall seek
Licensor's written approval of Manufacturer prior to Licensee's engagement of
Manufacturer. Any approval of Manufacturer granted by Licensor relates solely to
the manufacturing of the Licensed Product(s) and shall not constitute a grant of
any right, title or interest in or to the Logos, nor to any copyrights, service
marks, trademarks or other property rights associated therewith. Licensor hereby
reserves the right to terminate in its discretion the engagement of Manufacturer
at any time. Additionally, Licensor may confiscate goods or samples imported by
Licensee or shipped by Manufacturer that bear any of the Logos and that have not
been approved by Licensor as to quality.
15. ACKNOWLEDGEMENT OF RIGHTS: Licensee hereby acknowledges the proprietary
nature of all names and logos of the Major League Baseball Clubs, the Leagues,
the Office of the Commissioner of Baseball or Licensor and acknowledges that all
rights, title and interest to such names or logos belong to the individual
Clubs, the Leagues, the Office of the Commissioner of Baseball and/or Licensor,
as the case may be. Licensee represents that it has not made any unauthorized
use of names or logos of the Major League Baseball Clubs, the Leagues, the
Office of the Commissioner of Baseball or Licensor and agrees that it will make
no use of any such names or logos, other than as provided in this Agreement,
without the prior written consent of Licensor, the Office of the Commissioner of
Baseball or the appropriate individual League or Club. Any use Licensee has made
or will make of such names and logos has not conferred or will not confer, as
the case may be, any rights or benefits upon it whatsoever, and any rights
created by such use shall inure to the benefit of the individual Clubs, the
Leagues, the Office of the Commissioner of Baseball and/or Licensor, as the case
may be.
16. TERMINATION: A. Immediate Termination: Licensor shall have the right to
terminate this Agreement immediately upon the occurrence of any one or more of
the following events (herein called "defaults"):
(i) If Licensee fails to deliver to Licensor or to maintain in full force
and effect the insurance referred to in Paragraph 8 hereof; or
(ii) If any governmental agency or court of competent jurisdiction finds
that the Licensed Product(s) are defective in any way, manner or form; or
(iii) If Licensee shall breach any one of the following undertakings set
forth in Paragraph 13 hereof: 13A through F, H through J, Q, R or T; or
(iv) If Licensee shall undergo a change in majority or controlling
ownership.
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7
B. Termination With Cure Period: Licensor shall have the right to terminate
this Agreement upon the occurrence of any one or more of the following defaults,
and Licensee's failure to cure such default(s) completely within ten (10)
business days from Licensee's receipt of notice from Licensor:
(i) If Licensee fails to make any payment due hereunder on the date due, at
which time all monies which are owed during the current term or renewal referred
to in Schedule E of this Agreement shall become due and payable to Licensor; or
(ii) If Licensee fails to deliver any of the statements hereinabove
referred to or to give access to the premises and/or license records pursuant to
the provisions hereof to Licensor's authorized representatives for the purposes
permitted hereunder; or
(iii) If Licensee is unable to pay its debts when due, or makes any
assignment for the benefit of creditors or an 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 receiver or trustee to be appointed for its business or
property, or be adjudicated a bankrupt or an insolvent. In the event the license
granted hereunder is terminated pursuant to this Paragraph 16(B)(iii), neither
Licensee nor its receivers, representatives, trustees, agents, administrators,
successors and/or assigns shall have any right to sell, exploit or otherwise
deal with or in the Licensed Product(s) without the prior written consent of
Licensor; or
(iv) If Licensee does not commence in good faith to manufacture, distribute
and sell each Licensed Product throughout the Licensed Territory within any
twelve (12) month period, but such default and Licensor's resultant right of
termination shall apply only to the specific Licensed Product(s) and/or the
specific territory(ies) which or wherein Licensee fails to meet said
requirements; or
(v) If Licensee shall discontinue its business as it is now conducted; or
(vi) If Licensee shall breach any of the undertakings set forth in
Paragraph 13 hereof, except as otherwise provided in Paragraph 16(A)(iii) above;
or
(vii) If Licensee shall breach any of the terms of this Agreement; or
(viii) If, in the periodic statements furnished pursuant to Paragraph 5
hereof, the amounts owed to Licensor are significantly or consistently
understated.
Licensor's right to terminate this Agreement shall be without prejudice to
any other rights which it may have, whether under the provisions of this
Agreement, in law or in equity or otherwise. In the event any of these defaults
occurs and Licensor desires to exercise its right of termination under the terms
of this Paragraph 16, Licensor shall give notice of termination in writing to
Licensee. Any and all payments then or later due from Licensee hereunder
(including Advance Compensation) shall then become promptly due and payable in
full to Licensor and without set off of any kind; i.e., no portion of any prior
payments made to Licensor shall be repayable to Licensee. Until payment to
Licensor of any monies due it, Licensor shall have a lien on any units of the
Licensed Product(s) not then disposed of by Licensee and on any monies due
Licensee from any jobber, wholesaler, distributor, sublicensee or other third
parties with respect to sales of the Licensed Product(s). Upon termination or
expiration of the term hereof, all rights, licenses and privileges granted to
Licensee hereunder shall automatically revert to Licensor and Licensee shall
execute any and all documents evidencing such automatic reversion.
17. FINAL STATEMENT UPON TERMINATION OR EXPIRATION: Licensee shall deliver
to Licensor, as soon as practicable, following expiration or termination of this
Agreement, a statement indicating the number and description of the Licensed
Product(s) on hand. Following expiration or termination Licensee may manufacture
no more Licensed Product(s), but may continue to distribute its remaining
inventory for a period not to exceed ninety (90) days, subject to the terms of
Paragraph 13(P) hereof and payment of applicable royalties relative thereto;
provided, however, that such royalties shall not be applicable against Advance
Compensation or Guaranteed Compensation. Notwithstanding the foregoing, Licensee
shall not manufacture, sell or distribute any Licensed Product(s) after the
expiration or termination of this Agreement because of (a) the failure of
Licensee to cause the appropriate statutory notice of copyright, trademark,
service xxxx or user registration to appear wherever the Logos are used; (b) the
departure of Licensee from the quality and style approved by Licensor under the
terms of Paragraph 10 hereof; (c) the failure of Licensee to obtain the approval
of Licensor under the terms of Paragraph 10 hereof; or (d) the occurrence of an
event of default under the terms of Paragraph 16 hereof. Licensor shall have the
option to conduct physical inventories before termination and continuing until
the end of the 90-day sell-off period in order to ascertain or verify such
inventories and/or statement. Immediately upon expiration of the sell-off
period, Licensee shall furnish Licensor a detailed statement certified by an
officer of Licensee showing the number and description of Licensed Products on
hand in its inventory and shall dispose of such inventory at Licensor's
direction and at Licensee's expense. In the event Licensee refuses to permit
Licensor to conduct such physical inventory, Licensee shall forfeit its right
hereunder to dispose of such inventory. In addition to such forfeiture, Licensor
shall have recourse to all other remedies available to it.
18. INJUNCTION: Licensee acknowledges that its failure to perform any of
the terms or conditions of this Agreement, or its failure upon the expiration or
termination of this Agreement to cease the manufacture of the
================================================================================
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8
Licensed Product(s) and limit their distribution and sale as provided in
Paragraph 17 hereof, shall result in immediate and irreparable damage to
Licensor. Licensee also acknowledges that there may be no adequate remedy at law
for such failures and that in the event thereof Licensor shall be entitled to
equitable relief in the nature of an injunction and to all other available
relief, at law and/or in equity.
19. RESERVATION OF RIGHTS: Licensor retains all rights not expressly and
exclusively conveyed herein, and Licensor may license firms, individuals,
partnerships or corporations to use the Logos, artwork and textual matter in
connection with other products, including other products identical to the
Licensed Product(s) contemplated herein. Licensor reserves the right to use, or
license others to use and/or manufacture, identical items as premiums.
20. PAYMENTS AND NOTICES: All notices and statements provided for herein
shall be in writing, and all notices hereunder are to be sent to Major League
Baseball Properties, Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
President. All statements and payments shall be made to Major League Baseball
Properties and sent to an address designated by Licensor.
21. WAIVER, MODIFICATION, ETC.: No waiver, modification or cancellation of
any term or condition of this 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 this 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 this
Agreement shall not relieve either party of its respective obligations accruing
prior thereto, nor impair or prejudice the respective rights of either party
against the other, which rights by their nature survive such expiration.
Licensor makes no warranties or representations to Licensee except those
specifically expressed herein.
22. NO PARTNERSHIP, ETC.: This Agreement does not constitute and shall not
be construed as constituting an agency, partnership or joint venture
relationship between Licensee and Licensor and/or the Clubs. Licensee shall have
no right to obligate or bind Licensor in any manner whatsoever, and nothing
herein contained shall give or is intended to give any rights of any kind to any
third persons.
23. NON-ASSIGNABILITY: Licensee acknowledges and recognizes: (a) that it
has been granted the license described in Paragraph 1 because of its particular
expertise, knowledge, judgement, skill and ability; (b) that it has substantial
and direct responsibilities to perform this Agreement in accordance with all of
the terms contained herein; (c) that Licensor is relying on Licensee's unique
knowledge, experience and capabilities to perform this Agreement in a specific
manner consistent with the high standards of integrity and quality associated
with Major League Baseball as a national sport and with Major League Baseball
licensed merchandise; and (d) that the granting of the license under this
Agreement creates a relationship of confidence and trust between Licensee and
Licensor. This Agreement is personal to Licensee, and Licensee shall not
sublicense or franchise any of its rights hereunder, and neither this Agreement
nor any of the rights of Licensee hereunder shall be sold, transferred or
assigned by Licensee without Licensor's prior written approval and no rights
hereunder shall devolve by operation of law or otherwise upon any assignee,
receiver, liquidator, trustee or other party. Subject to the foregoing, this
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto, their successors and assigns.
24. PARAGRAPH HEADINGS: Paragraph headings contained in this Agreement are
for convenience only and shall not be considered for any purpose in governing,
limiting, modifying, construing or affecting the provisions of this Agreement
and shall not otherwise be given any legal effect.
25. CONSTRUCTION: This Agreement shall be construed in accordance with the
laws of the State of New York, which shall be the sole jurisdiction for any
disputes.
26. SEVERABILITY: The determination that any provision of this Agreement is
invalid or unenforceable shall not invalidate this Agreement, and the remainder
of this Agreement shall be valid and enforceable to the fullest extent permitted
by law.
27. TIME OF THE ESSENCE: Time is of the essence of all parts of this
Agreement.
28. ACCEPTANCE BY LICENSOR: This instrument, when signed by Licensee or a
duly authorized officer of Licensee if Licensee is a corporation, shall be
deemed an application for a license and not a binding agreement unless and until
signed by a duly authorized officer of Licensor. The receipt and/or deposit by
Licensor of any check or other consideration given by Licensee and/or the
delivery of any material by Licensor to Licensee shall not be deemed an
acceptance by Licensor of this application. The foregoing shall also apply to
any documents relating to renewals or modifications hereof.
29. INTEGRATION: This Agreement, when fully executed, shall represent the
entire understanding between the parties hereto with respect to the subject
matter hereof and supersedes all previous representations, understandings or
agreements, oral or written, between the parties with respect to the subject
matter hereof.
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9
30. SURVIVAL OF PROVISIONS: Paragraphs 2, 6, 7A, 7C, 8, 12, 13A, B, C, D,
F, H, I, K, Q and R, 15, 17, 18, 19, 21, 22, 24, 25, 26, 30 and 31 shall survive
any termination or expiration of this Agreement.
31. MISCELLANEOUS: By signing below, Licensee acknowledges that this
Agreement is for the term specified in Schedule D only and that neither the
existence of this Agreement nor anything contained herein shall impose on
Licensor any obligation to renew or otherwise extend this Agreement after
expiration of the license period.
-10-
SCHEDULE A
LOGOS
The names, characters, symbols, designs, likenesses, visual representations
and such other similar or related identifications (but such similar or related
identifications must be approved in writing by Licensor in advance of use) of
the following noted organizations in connection with the marketing, promotion
and sale of that described in Schedule B hereof: (1) Major League Baseball
Properties, Inc., (2) the American League, (3) the National League, (4) the
following Clubs: Arizona Diamondbacks, Tampa Bay Devil Rays, Baltimore Orioles,
Boston Red Sox, California Angels, Chicago White Sox, Cleveland Indians, Detroit
Tigers, Kansas City Royals, Milwaukee Brewers, Minnesota Twins, New York
Yankees, Oakland Athletics, Seattle Mariners, Texas Rangers, Toronto Blue Jays,
Atlanta Braves, Chicago Cubs, Cincinnati Reds, Colorado Rockies, Florida
Marlins, Houston Astros, Los Angeles Dodgers, Montreal Expos, New York Mets,
Philadelphia Phillies, Pittsburg Pirates, St. Louis Cardinals, San Diego Padres
and San Francisco Giants, (5) All-Star Game, Division Series, League
Championship Series, World Series, other names given to such games or events and
other names given to other Major League Baseball playoff games and (6) Major
League Baseball Authentic Diamond Collection.
SCHEDULE B
LICENSED PRODUCT(S)
*** ALL LICENSED PRODUCTS SHALL CONFORM TO LICENSOR'S
THEN-CURRENT LABELING REQUIREMENTS. ***
1. Authentic jackets made of 100% insulated nylon fabric, featuring a
full zippered or a snap front and embroidered Logos, and marketed
under Licensor's Authentic Diamond Collection line of products, in
adult, youth and children's sizes as defined below.
2. Authentic jackets made of 100% nylon fabric, featuring a full zippered
or a snap front and embroidered Logos and marketed under Licensor's
Authentic Diamond Collection line of products, in adult, youth and
children's sizes as defined below.
3. Authentic jackets in a pullover style, made of 100% nylon fabric and
featuring a half or full-zippered front or half or full-snap front and
embroidered Logos and marketed under Licensor's Authentic Diamond
Collection line of products, in adult, youth and children's sizes as
defined below.
4. Authentic jackets made of an insulated wool blend fabric body and
leather sleeves featuring a full snap front and embroidered Logos and
marketed under Licensor's Authentic Diamond Collection line of
products, in adult, youth and children's sizes as defined below.
5. Authentic jackets made of insulated satin fabric, a full snap front
and embroidered Logos and marketed under Licensor's Authentic Diamond
Collection line of products, in adult, youth and children's sizes as
defined below.
6. Authentic jackets made of satin fabric and featuring a full snap front
and embroidered Logos and marketed under Licensor's Authentic Diamond
Collection line of products, in adult, youth and children's sizes as
defined below.
7. Authentic jackets made with a down fill, in waist or 3/4 length sizes
and featuring embroidered Logos and marketed under Licensor's
Authentic Diamond Collection line of products, in adult, youth and
children's sizes as defined below.
8. Authentic jackets in a stadium style, made with a polyester fill and
embroidered and/or appliqued Club Logos, and marketed under Licensor's
Authentic Diamond Collection line of products, in adult, youth and
children's sizes as defined below.
9. Jackets (other than authentic jackets) made of 100% insulated nylon
fabric, featuring a full zippered or a snap front and embroidered
and/or appliqued Club Logos, in adult, youth and children's sizes as
defined below.
10. Jackets (other than authentic jackets) made of 100% nylon fabric,
featuring a full zippered or snap front and embroidered and/or
appliqued Club Logos, in adult, youth and children's sizes as defined
below.
11. Jackets (other than authentic jackets) in a pullover style, made of
100% nylon fabric, featuring a half or full zippered front or a half
or full-snap front and embroidered and/or appliqued Club Logos, in
adult, youth and children's sizes as defined below.
12. Jackets (other than authentic jackets) in a pullover style, made of
100% insulated nylon fabric, featuring a half or full zippered front
or a half or full-snap front and embroidered and/or appliqued Club
Logos, in adult, youth and children's sizes as defined below.
13. Jackets (other than authentic jackets) made of insulated
polyester/nylon blend fabric, featuring a full zippered or a snap
front and embroidered and/or appliqued Club Logos, in adult, youth and
children's sizes as defined below.
-11-
14. Jackets (other than authentic jackets) made of polyester/nylon blend
fabric, featuring a full zippered front and embroidered and/or
appliqued Club Logos, in adult, youth and children's sizes as defined
below.
15. Jackets (other than authentic jackets) in a pullover style, made of
insulated polyester/nylon blend fabric, featuring embroidered and/or
appliqued Club Logos, in adult, youth and children's sizes as defined
below.
16. Jackets (other than authentic jackets) in a pullover style, made of
polyester/nylon blend fabric, featuring embroidered and/or appliqued
Club Logos, in adult, youth and children's sizes as defined below.
17. Jackets (other than authentic jackets) in a pullover style, made with
an insulated wool blend body and leather or polyurethane sleeves,
featuring a full zippered or snap front and embroidered and/or
appliqued Club Logos, in adult, youth and children's sizes as defined
below.
18. Jackets (other than authentic jackets) in a parka style, made with
down filling, featuring embroidered and/or appliqued Club Logos, in
adult, youth and children's sizes as defined below.
19. Jackets (other than authentic jackets) made of 100% insulated cotton
fabric, featuring a full zippered or a snap front and embroidered
and/or appliqued Club Logos, in adult, youth and children's sizes as
defined below.
20. Jackets (other than authentic jackets) made of 100% cotton fabric,
featuring a full zippered front and embroidered and/or appliqued Club
Logos, in adult, youth and children's sizes as defined below.
21. Jackets (other than authentic jackets) made of satin or insulated
satin fabric, featuring a full snap front and embroidered and/or
appliqued Club Logos, in adult, youth and children's sizes as defined
below.
22. Jackets (other than authentic jackets) made of polar fleece-like
fabric, in pullover or full snap front styles and featuring
embroidered and/or appliqued Logos, in adult, youth and children's
sizes as defined below.
23. Jackets (other than authentic jackets) in a warm-up style, made of
100% nylon fabric and featuring embroidered Logos, in adult, youth
and children's sizes as defined below.
24. Jackets (other than authentic jackets) in a warm-up style, made of
polyester blend fabric and featuring embroidered Logos, in adult,
youth and children's sizes as defined below.
25. Tank tops made of 100% cotton or polyester/cotton blend fabric
featuring Club Logos on the front of the top and/or the name or
nickname of a current, active Major League Baseball player in block or
script lettering on the back of the top, in adult, youth and
children's sizes as defined below.
26. T-shirts made of 100% cotton or polyester/cotton blend fabric
featuring Club Logos on the front of the T-shirt and/or the name or
nickname of a current, active Major League Baseball player in block or
script lettering on the back of the T-shirt, in adult, youth and
children's sizes as defined below.
27. Pullover jackets made of fleece fabric featuring Club Logos on the
front of the jacket and/or the name or nickname of a current Major
League Baseball player in block or script lettering on the back of the
jacket, in adult, youth and children's sizes as defined below.
28. Turtlenecks (other than authentic turtlenecks) in long or short-sleeve
styles, made of 100% cotton jersey knit fabric and featuring
embroidered or screen printed Logos, in adult and youth sizes as
defined below.
29. Polo shirts made of cotton jersey, mesh knit or polyester/cotton blend
fabric and featuring a collar, a button placket, banded short sleeves
and embroidered or screen printed Logos, in adult and youth sizes as
defined below.
30. T-shirts made of midweight 100% cotton jersey fabric and featuring
ring necks in xxxx, xxxxxxx, white and/or other colors to be
pre-approved in writing by Licensor, and embroidered or screen printed
Logos, in adult, youth and children's sizes as defined below.
31. Pants and shorts (other than those worn by coaches of the Clubs) in
designs and styles to be pre-approved in writing by Licensor in
adult, youth and children's sizes as defined below.
32. Pullover tops made of nylon or polyester/mesh, heavy or light weight
fleece or art fleece jersey fabric, featuring a zipper and/or a button
placket, with or without a hood and Logos applied in any combination
of the following: applique, embroidery, emblems and/or screen printed,
in youth and children's sizes as defined below.
33. Jackets (other than authentic jackets) made of 100% insulated nylon
fabric, featuring a full zippered or a snap front and embroidered
and/or appliqued Clubs Logos, and marketed under Licensee's "First
Pick" brand name, in adult, youth and children's sizes as defined
below.
34. Jackets (other than authentic jackets) made of 100% nylon fabric,
featuring a full zippered or a snap front and embroidered and/or
appliqued Club Logos, and marketed under Licensee's "First Pick" brand
name, in adult, youth and children's sizes as defined below.
-12-
35. Jackets (other than authentic jackets) in a pullover style, made of
100% nylon fabric, featuring a half-zippered or a snap front and
direct embroidered and/or appliqued Club Logos, and marketed under
Licensee's "First Pick" brand name, in adult, youth and children's
sizes as defined below.
36. Jackets (other than authentic jackets) made of insulated nylon fabric,
in a pullover style, featuring a half-zippered or a snap front and
direct embroidered and/or appliqued Club Logos, and marketed under
Licensee's "First Pick" brand name, in adult, youth and children's
sizes as defined below.
37. Jackets (other than authentic jackets) made of insulated satin fabric,
featuring a full snap front and embroidered and/or appliqued Club
Logos, and marketed under Licensee's "First Pick" brand name, in
adult, youth and children's sizes as defined below.
38. Jackets (other than authentic jackets) made of satin fabric, featuring
a full snap front and embroidered or appliqued Club Logos, and
marketed under Licensee's "First Pick" brand name, in adult, youth and
children's sizes as defined below.
39. Jackets (other than authentic jackets) in a stadium style, made with
polyester fill and featuring embroidered or appliqued Club Logos, and
marketed under Licensee's "First Pick" brand name, in adult, youth and
children's sizes as defined below.
40. Jackets (other than authentic jackets) in a pullover style, made of
100% nylon fabric and featuring embroidered and/or appliqued Club
Logos, and marketed under Licensee's "First Pick" brand name, in
adult, youth and children's sizes as defined below.
41. Jackets (other than authentic jackets) made of an insulated
polyester/nylon blend fabric and featuring a full zippered or a full
snap front and embroidered or appliqued Club Logos, and marketed under
Licensee's "First Pick" brand name, in adult, youth and children's
sizes as defined below.
42. Jackets (other than authentic jackets) made of polyester/nylon blend
fabric and featuring a full zippered or a full snap front and
embroidered or appliqued Club Logos, and marketed under Licensee's
"First Pick" brand name, in adult, youth and children's sizes as
defined below.
43. Jackets (other than authentic jackets) in a pullover style, made of an
insulated polyester/nylon blend fabric and featuring embroidered or
appliqued Club Logos, and marketed under Licensee's "First Pick" brand
name, in adult, youth and children's sizes as defined below.
44. Jackets(other than authentic jackets) in a pullover style, made of
polyester/nylon blend fabric and featuring a full zippered or a full
snap front and embroidered or appliqued Club Logos, and marketed under
Licensee's "First Pick" brand name, in adult, youth and children's
sizes as defined below.
45. Jackets (other than authentic jackets) made of insulated cotton fabric
and featuring a full zippered or a full snap front and embroidered or
appliqued Club Logos, and marketed under Licensee's "First Pick" brand
name, in adult, youth and children's sizes as defined below.
46. Jackets (other than authentic jackets) made of cotton fabric and
featuring a full zippered or a full snap front and embroidered or
appliqued Club Logos, and marketed under Licensee's "First Pick" brand
name, in adult, youth and children's sizes as defined below.
47. Jackets (other than authentic jackets) in warm-up style, made of 100%
nylon fabric and featuring embroidered or appliqued Club Logos, and
marketed under Licensee's "First Pick" brand name, in adult, youth and
children's sizes as defined below.
48. Jackets (other than authentic jackets) with a down fill, in waist or
3/4 length sizes and featuring embroidered Logos, in adult, youth and
children's sizes as defined below.
49. Jackets (other than authentic jackets) in a stadium style, with a
polyester fill and featuring embroidered and/or appliqued Club Logos,
in adult, youth and children's sizes as defined below.
50. Non- replica baseball-style jerseys made of 100% cotton or 50/50
cotton-polyester blend fabric, featuring a full-button front and
embroidered and/or appliqued Club Logos, in adult, youth and
children's sizes as defined below.
For the purposes of this Agreement, except as specifically modified by the
descriptions for the Licensed Product Nos. 1-8, "authentic" jackets and
turtlenecks shall mean: jackets and turtlenecks identical in design (including,
but not limited to, style, silhouette, color and Logo placement) and fabrication
to jackets and turtlenecks worn on-field by Major League Baseball players,
coaches or managers, regardless of size or whether numbers are worn on field.
For purposes of this Agreement, except as specifically modified by the
description for the Licensed Product No. 50, "non-replica baseball-style
jerseys" shall mean: jerseys made of any fabrication, color, silhouette and
style and with any Logo placement and Logo application, and featuring one or
more Club Logos; provided that if the jerseys have the identical style and
silhouette (without regard to the existence or number of bands on item) as the
jerseys worn on-field by the Major League Baseball players, coaches or managers,
then such jerseys shall not contain the same Logo or Lettering, regardless of
whether home or road, as the on-field jerseys.
-13-
Rights to utilize players' names and/or likenesses are not granted under
this Agreement. Licensee must present to Licensor written evidence of having
obtained the proper authorization to utilize any players' names and/or
likenesses in conjunction with the Licensed Products.
SIZES
ADULT:
S M L XL
34/36 38/40 42/44 46/48 (chest sizes)
28/30 32/34 36/38 40/42 (waist sizes)
YOUTH:
S M L XL
Boys: 8/10 12/14 16/18 20
Girls: 7/8 10/12 14
CHILDREN'S:
Newborn: 3/6 6/9 months
Infant: 12 18 24 months
Toddler: 2T 3T 4T
Boys: 4 5 6 7
Girls: 4 5 6 6X
SCHEDULE C
LICENSED TERRITORY
The fifty United States of America, the District of Columbia, Puerto Rico
and U.S. territories and possessions, including U.S. military bases worldwide.
SCHEDULE D
LICENSE PERIOD
January 1, 1995 - December 31, 1999
SCHEDULE E
COMPENSATION
TOTAL GUARANTEED COMPENSATION: $7,OOO,OOO.OO
PAYABLE AS:
(i) NON-RETURNABLE ADVANCE COMPENSATION due upon signing:
$1,000,000.00
(ii) REMAINDER OF GUARANTEED COMPENSATION due as follows:
April 1, 1996 ........... $500,000.00 April 1, 1997 ......... $500,000.00
July 1, 1996 ............ $500,000.00 July 1, 1997 .......... $500,000.00
November 1, 1996 ........ $500,000.00 November 1, l997 ...... $500,000.00
Total 1995-1996 Guarantee.. $2,500,000.00 Total 1997 Guarantee .. $1,500,000.00
April 1, 1998 ........... $500,000.00 April 1, 1999 ......... $500,000.00
July 1, 1998 ............ $500,000.00 July 1, 1999 .......... $500,000.00
November 1, 1998 ........ $500,000.00 November 1, 1999 ...... $500,000.00
Total 1998 Guarantee... $1,500,000.00 Total l999 Guarantee .. $1,500,000.00
PERCENTAGE COMPENSATION:
For Licensed Products Nos. 1-8:
Ten percent (10%) of net sales as defined in Paragraph 4B.
-14-
For Licensed Products Nos. 9-50:
Nine percent (9%) of net sales as defined in Paragraph 4B.
Percentage Compensation earned in either of calendar years 1995 or 1996 may
be applied against the Guaranteed Compensation payable in that two-year period;
otherwise, Percentage Compensation shall be applied against Guaranteed
Compensation payable in the same calendar year only, without carryover.
Percentage Compensation attributable to premium sales of the Licensed Products
shall not be applied against Total Guaranteed Compensation.
SCHEDULE F
MANUFACTURER:
Licensee agrees that at no time during the license or sell-off periods
shall it sell, directly or indirectly, to any of the Manufacturers listed
below, or to any individual or entity affiliated in any manner with any of
such Manufacturers, any Licensed Products for subsequent sale or
distribution, without prior written approval of Licensor.
1) Licensed Product(s): ______________________________
Name of Manufacturer: _____________________________
Address: __________________________________________
Telephone: _____________________________
Principal Contact: ________________________________
Approved by Major League Baseball
Properties, Inc.: _____________________________
Initials/Title
______________________________
Date
2) Licensed Product(s): ______________________________
Name of Manufacturer: _____________________________
Address: __________________________________________
Telephone: _____________________________
Principal Contact: ________________________________
Approved by Major League Baseball
Properties, Inc.: _____________________________
Initials/Title
______________________________
Date
3) Licensed Product(s): ______________________________
Name of Manufacturer: _____________________________
Address: __________________________________________
Telephone: _____________________________
Principal Contact: ________________________________
Approved by Major League Baseball
Properties, Inc.: _____________________________
Initials/Title
______________________________
Date
-15-
SCHEDULE G
Product Credit:
1. Licensee shall provide to Licensor merchandise credit in the amount of
$15,000.00 (wholesale value) during each year of the license period. Licensee
shall ship at Licensor's direction such merchandise as Licensor shall request
from time to time under this merchandise credit.
2. In addition, Licensee shall provide to Licensor merchandise credit in
the amount of $25,000.00 (wholesale value) during each year of the license
period for use at the annual Major League Baseball All-Star FanFest ("FanFest")
event. Licensee shall ship at Licensor's direction such merchandise as Licensor
shall request from time to time under this merchandise credit.
3. Licensee shall also provide to Licensor merchandise credit in the amount
of $25,000.00 (wholesale value) during each year of the license period to use in
connection with Major League Baseball Youth Clinics/Market Development. Licensee
shall ship at Licensor's direction such merchandise as Licensor shall request
from time to time under this merchandise credit, and Licensor shall, in its sole
discretion, determine how to distribute such merchandise.
Advertising:
1. Licensee acknowledges that it is required to promote the Licensed
Products under this Agreement. Accordingly, during each year of the license
period, Licensee represents that it shall purchase at prevailing rates, and
produce, at no cost or expense to Licensor, (i) one full page, four-color
advertisement in all event publications produced by or on behalf of Licensor and
(ii) the back cover of every issue of Major League Baseball For Kids magazine
published by Licensor.
2. Licensee shall contribute the following amounts to participate in
Licensor's cooperative advertising program by May 1 of each of the following
years:
1996 .... $65,000.00
1997 .... $65,000.00
1998 .... $75,000.00
1999 .... $75,000.00
3. Licensee acknowledges that under this Agreement it is obligated to
promote the Licensed Products. Accordingly, Licensee has agreed to pay to
Licensor a minimum of $125,000.00 per year to participate in each FanFest event
and related clinics conducted during the license period and to execute
Licensor's standard FanFest Sponsorship agreements in connection therewith. The
extent of Licensee's participation at the FanFest events shall be mutually
agreed upon by Licensee and Licensor.
4. Licensee represents that during each year of the license period, it
shall spend a minimum of $20,000.00 per Club on promotional exposure (including,
without limitation, signage, print and broadcast advertising featuring
individual Club Logos) for each Club wearing the Licensed Products produced for
such Club by Licensee. The manner in which Licensee shall promote each such Club
shall be agreed to by Licensee and the applicable Club.
5. Licensee represents that it plans to spend no less than $500,000.00 in
1995 and no less than $l,000,000.00 in l996 on television advertising to promote
Major League Baseball or the Licensed Products, to be aired during telecasts of
Major League Baseball games broadcast by national over-the-air television
network rights holders designated by Licensor. Licensee further represents that
during each of calendar years 1997, 1998 and 1999, it plans to spend three (3%)
percent of its prior year's gross wholesale sales of all products under its
license agreements with Licensor, or $l,000,000.00, whichever is greater, to
purchase advertising time during telecasts of Major League Baseball games
broadcast by national over-the-air television network rights holders designated
by Licensor.
Strike Clause/Game Cancellations:
In the event of a players' strike or other labor-related dispute which
results in the cancellation of regular season games for more than 21 consecutive
days, Licensee shall have an opportunity to demonstrate that its sales of
Licensed Products suffered as a result thereof and that Licensee will not be
able to earn its minimum Guaranteed Compensation or meet its advertising
commitments identified in Schedule G, Advertising Nos. 1-5, above. Subject to
Licensee demonstrating such adverse effects on its sales of Licensed Products,
Licensor and Licensee will agree on a reduction of the minimum Guaranteed
Compensation and Licensee's advertising commitments hereunder by an amount to
reflect the damage suffered by Licensee.
Miscellaneous:
1. Licensee acknowledges that it shall provide free of cost, in an
expeditious manner and to each Club's satisfaction, the quantity of Licensed
Product requested by each Major League Baseball Club wearing the Licensed
Products produced for such Major League Baseball Club by Licensee.
2. Licensee acknowledges that it is obligated to provide products for the
Major League Baseball Umpire program for calendar year 1995. Licensor
acknowledges that all such products were received by the Major League Baseball
Umpire program.
-16-
3. Notwithstanding any language to the contrary contained in Paragraph 1 of
this Agreement, but subject to the terms of this Paragraph 3, during calendar
years 1995 and 1996, Licensor shall not license any other entity to produce and
distribute Licensed Product Nos. 1-8 in the Licensed Territory. Thereafter,
Licensor represents and agrees that, except as otherwise approved by Licensee,
Licensor xxxXx xxxxx to no more than two (2) other entities during the term the
right to distribute Licensed Product Nos. 1-8 in the licensed Territory.
Licensor shall notify Licensee Licensor no later than March 31 of the year prior
to the affected year of the number of other entities, if any, to whom such
rights have been granted by Licensor.
4. Licensor shall have the option, exercisable by January 15, 1999, to
extend the license period for a three (3) year period, on terms and conditions
that are substantially similar to the terms and conditions contained in
Licensor's other license agreements with licensees producing items similar to
those identified in Schedule B herein. The factors that Licensor may consider in
determining whether to exercise such option include, without limitation, whether
(i) the Clubs are fully satisfied with the products and services provided to
them by Licensee pursuant to this Agreement; (ii) Licensee has earned the
Guaranteed Compensation under this Agreement in each of calendar years 1996,
1997 and 1998; and (iii) Licensee is not in default hereunder.
5. Notwithstanding anything to the contrary contained herein, Licensor
acknowledges and agrees that any Guaranteed Compensation in excess of that which
is payable by Licensee hereunder may be applied against guaranteed compensation
payable under License Agreement No. ML-2771A. In connection therewith,
Percentage Compensation earned hereunder in either of calendar years 1995 or
1996 in excess of Guaranteed Compensation payable for such two-year period may
be applied against guaranteed compensation payable under License Agreement No.
ML-2771A for the period of 1995-1996, only. Similarly, Percentage Compensation
earned hereunder in calendar year 1997 in excess of Guaranteed Compensation
payable for calendar year 1997 may be applied against guaranteed compensation
payable under License Agreement No. ML-2771A for calendar year 1997, only.
Percentage Compensation earned hereunder for any calendar year not specified in
this Paragraph may not be applied against guaranteed compensation due under
License Agreement No. ML-2771A for any period whatsoever.
6. Licensee acknowledges that Licensor may, in its sole discretion, change
the name and/or logo of its authentic line of products, and that upon the
implementation of such change, Licensee shall market the Products licensed
herein under such new name and/or logo.
7. Licensee shall have the right to purchase, at face value, twelve (12)
tickets to each All-Star Game and twenty-four (24) tickets to each Division
Series, League Championship Series and World Series game played during the
license period.
8. Notwithstanding anything to the contrary contained in Paragraph 13S of
this Agreement, Licensee may grant a security interest in the Licensed Products
to a credible financial institution which maintains at least an A- rating from a
nationally recognized credit rating agency (such as Xxxxx'x or Standard & Poors)
throughout the license period; provided that (i) no distribution of such
Products is made by such institution or its agents, representatives, affiliates,
successors, or assignees without the prior written consent of Licensor, and (ii)
such institution does not have an investment or interest in casinos or any other
form of legalized gambling enterprise and does not participate in any activity
that Licensor or any other Major League Baseball-related entity has made
unauthorized or which is contrary to official policy of Major League Baseball.
9. Concurrently with its execution of this Agreement, Licensee will list
below the brand names that Licensee desires or intends to use on the Licensed
Products.
Brand Names:
1) Licensed Product(s) Nos.: ____________________
Brand Name(s): _______________________________
Approved by Major League Baseball
Properties, Inc.: _______________________________________
Initials/Title
________________________________________
Date
2) Licensed Product(s) Nos.: ____________________
Brand Name(s): _______________________________
Approved by Major League Baseball
Properties, Inc.: _______________________________________
Initials/Title
________________________________________
Date
-17-
3) Licensed Product(s) Nos.: ____________________
Brand Name(s): _______________________________
Approved by Major League Baseball
Properties, Inc.: _______________________________________
Initials/Title
________________________________________
Date
In the event Licensee wishes to substitute a brand name for those listed
above or wishes to add to the number of brand names, Licensee shall first obtain
Licensor's written approval of such brand names.
IN WITNESS WHEREOF, the parties hereto have signed this Agreement:
MAJOR LEAGUE BASEBALL PROPERTIES, INC., as agent for the Clubs
BY: /s/ [Illegible] Sr. V. Pres
________________________________________________________________
Title
DATE: 5-14-96
LICENSEE: STARTER CORPORATION
BY: /s/ [Illegible] SVP
________________________________________________________________
Title
DATE: 4-19-96
