FORM: NBPA
U.S./NON-APPAREL
LICENSEE: INNOVO, INC. RETAIL PRODUCT LICENSE AGREEMENT
ADDRESS: 00 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
THIS RETAIL PRODUCT LICENSE AGREEMENT is entered into by NBA Properties,
Inc. ("NBAP"), with its principal office at 000 Xxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, and the licensee listed above ("LICENSEE") with regard
to the commercial use of certain names, logos, symbols, emblems, designs
and uniforms and all identifications, labels, insignia or indicia thereof
(the "Marks") of the national Basketball Association (the "NBA") and its
Member Teams (collectively, the "NBA Marks"). On the terms of this
Agreement and subject to the attached NBAP Standard Terms and Conditions,
NBAP hereby accepts, the non-exclusive (except as otherwise expressly
provided in this Agreement) right and license to use the marks of the
member Teams, the silhouetted dribbler logo (the "NBA Logo") and the
Marks of the NBA, NBA All-Star Weekend and NBA Playoffs and Finals
(collectively, the "Licensed Marks") solely in connection with the
manufacture, distribution, advertisement, promotion and sale of the
products described in Paragraph A below including one or more of the
Licensed Marks ("Licensed Products"). No license or right is granted for
the use of the Licensed Marks for any purpose other than on the Licensed
Products and in the distribution, advertisement, promotion and sale of
the Licensed Products in accordance with this Agreement.
A. LICENSED PRODUCTS:
* insulated and non-insulated vinyl lunch bags and soft-
sided coolers
* cotton canvas tote bags
* nylon, vinyl and/or cotton laundry bags
* shoe bags
* garment bags
* "Cush-N-Carry" seat cushions
B. TERM: As of August 1, 1997 to July 31, 1998 (the "Term").
C. TERRITORY: Licensed Products may only be distributed in the 00
Xxxxxx Xxxxxx and the District of Columbia, except that product may
be shipped to the in-arena concessionaires of the Toronto Raptors
and Vancouver Grizzlies (the "Territory").
D. ROYALTY RATES: During the Term, LICENSEE shall pay monthly to NBAP
a royalty and advertising and promotion payment (hereinafter
referred to as "royalty") equal to twelve percent (12%) of "Net
Sales" (as defined in Paragraph 1 of the attached NBAP Standard
Terms and Conditions).
E. MINIMUM GUARANTEES: LICENSEE guarantees that its aggregate royalty
payments to NBAP for the Term under this Agreement shall not be
less than forty-six thousand dollars ($46,000).
F. ADVANCES: Upon execution of this Agreement, LICENSEE shall pay to
NBAP the sum of eleven thousand five hundred dollars ($11,500) as an
advance to be credited against LICENSEE's Minimum Guarantee as set
forth above.
G. ADVERTISING AND PROMOTION:
(i) Consistent with NBAP's past practice of creating, undertaking
or supporting advertising and promotion activities with respect
to NBAP-licensed products sold at retail, NBAP shall devote up
to two percent (2%) of Net Sales (from the royalties received
from LICENSEE pursuant to this Agreement) to cover the expenses
incurred by NBAP in connection with such advertising and
promotion activities.
(ii) LICENSEE shall exhibit, at its sole cost and expense, a fair
and representative selection of Licensed Products at the Super
Show and every other trade show where LICENSEE exhibits
licensed products.
H. SELLING PRACTICES: LICENSEE acknowledges NBAP's legitimate and
reasonable interest in protecting the value of the NBA Marks and
maximizing the effectiveness of its advertising, promotion and
distribution efforts by segmenting the classes of trade into which
its licensees sell NBAP-licensed products. Therefore, LICENSEE
shall only sell Licensed Products to a buyer that, to its best
knowledge (i) purchases Licensed Products from LICENSEE solely for
sale directly to the consumer and operates a retail establishment
that supports the high quality and image of NBA officially licensed
products with appropriate merchandising displays, promotion and/or
customer service. LICENSEE acknowledges that a failure to comply
with the selling practices set forth in this Paragraph shall cause
significant harm to NBAP's efforts to effectively and efficiently
distribute NBAP-licensed products.
AGREED TO AND ACCEPTED, subject AGREED TO AND ACCEPTED:
to and incorporating the attached NBAP NBA PROPERTIES, INC.
Standard Terms and Conditions which
the undersigned has read:
INNOVO, INC. By:_____________________
Xxxxxx X. Xxxxxxxx
Senior Vice President,
Business Affairs
By:________________________
Title:_____________________ Dated:__________________
NBAP STANDARD TERMS AND CONDITIONS
1. ADDITIONAL DEFINITIONS
For the purposes of this Agreement
(a) "Contract Year" shall mean a twelve (12) month accounting
period commencing August 1 and concluding July 31.
(b) "Counterfeit Goods: shall mean and include: (i) goods that
bear any NBA xxxx that has been reproduced and/or affixed
without authorization from NBAP; (ii) goods that bear any NBA
Xxxx produced by any source in excess of an amount ordered by
an NBAP licensee; and (iii) goods that bear any NBA Xxxx that
have been rejected by NBAP or an NBAP licensee and nevertheless
enter the stream of commerce.
(c) "Diverted Goods" shall mean and include any goods produced by
someone acting on behalf of an NBAP licensee, which goods are
not delivered by the producer to such licensee or to a person
designated by such licensee to receive such goods.
(d) "Net Sales" shall mean the total amount of the gross sales of
a Licensed Product by LICENSEE. After deducting any bona-fide
credit or adjustment for returns actually made and volume
discounts actually and customarily given to the trade (such
discounts may not exceed two percent (2%) of the gross sales
for the applicable accounting period). In computing Net Sales,
no direct or indirect expenses or costs incurred in connection
with paying royalties due under this Agreement (including
transferring funds for royalties or converting currency into
U.S. dollars) or manufacturing, selling, distributing,
importing or advertising including cooperative and other
advertising and promotion allowances( the Licensed Products
shall be deducted, nor shall any deduction be made for
uncollectible accounts, cash discounts, early payment
discounts, discounts relating to advertising, xxxx-down
allowances or other allowances. Net sales resulting from sales
to any party directly or indirectly related to or affiliated
with LICENSEE (a "Related Transaction") shall be the higher of
the sales price to the related or affiliated party or the sales
price charged to the trade by such related or affiliated party.
If a purchaser from LICENSEE purchases FOB the manufacturing
source or participates in other arrangements which result in
such purchaser paying less for the Licensed Products than
LICENSEE's regular selling prices to the trade, Net Sales with
respect to any such transaction shall be computed based on the
regular selling prices to the trade.
(e) "Parallel Goods" shall mean and include Licensed Products
transferred outside of the Territory or brought into the
Territory in violation of this Agreement.
(f) "Premium" shall mean anything given free or sold at
substantially less than its usual selling price (but does not
include sales made pursuant to periodic price reductions
resulting from"specials," "sales," or volume pricing discounts)
for the purpose of increasing the sale of, or publicizing, any
product or service, or other giveaway or promotional purpose.
Other giveaway or promotional purposes include, but are not
limited to, self-liquidating offers, uses of Licensed Products
as sales force or trade incentives and sales of Licensed
Products through distribution schemes involving earned
discounts or "bonus" points based on the consumer's use of the
offeror's product or service.
2. TEAM REPRESENTATION; LIMITATIONS ON LICENSE
(a) Unless otherwise approved in writing by NBAP, each Licensed
Product must be manufactured and offered for sale on LICENSEE's
standard terms in a version for each Member Team. LICENSEE
acknowledges that, unless the NBA Logo is specifically
contained in the definition of Licensed Marks above, no license
is granted for the use of the NBA Logo except insofar as the
NBA Logo is embodied in the NBA "Official Licensed Product"
logo. Unless otherwise approved in writing by NBAP, the NBA
Logo may only be used in combination with the Marks of one (1)
or more Member Teams (i.e., the NBA Logo may not be used by
itself), which must be shown with equal or greater prominence
that the NBA Logo.
(b) All designs of the Licensed Products, including any packages,
containers or tags, shall be subject to NBAP's prior written
approval and shall be used solely in furtherance of this
Agreement, and such designs will not be used in any other
respect by LICENSEE nor will LICENSEE authorize any third party
to use such designs acknowledges that LICENSEE may hold other
licenses pursuant to which LICENSEE manufactures, distributes
or sells products similar in design to the Licensed Products
and nothing in this Agreement is intended to prohibit
LICENSEE's manufacture, distribution or sale of such products
not bearing or relating to the Licensed Marks.
3. STATEMENTS AND PAYMENTS; REPORTING
(a) Statement and Payments: By the fifteenth (15th) day following
the end of each month, LICENSEE shall furnish (on forms
provided by or approved by NBAP) full and accurate statements
(on a county-by-country and unit basis, if more than one
country is contained within the definition of the Territory),
certified by an officer of LICENSEE, showing all information
relating to the calculation of Net Sales for the preceding
month. Simultaneously with the submission of such statement,
LICENSEE shall make all monthly royalty payments required under
this Agreement for the preceding month. The minimum amount of
royalties to be paid by LICENSEE by the end of each quarter
with respect to each Licensed Product category shall be the
amount which, when added to payments of royalties previously
made for the Contract Year with respect to such Licensed
Product category, shall be equal to one-fourth (25%) of the
Minimum Guarantee for such Licensed Product category for such
Contract Year required under Paragraph E above multiplied by
the number of quarters then elapsed. Aggregate royalties paid
each Contract Year may exceed the Minimum Guarantee for such
Contract Year. Such monthly statements shall be furnished and
the required payments made by LICENSEE whether or not there are
any Net Sales for that month. LICENSEE shall not deduct or
withhold any amounts by reason of any tax (including any taxes
imposed on NBAP); any applicable tax on the distribution and
sale of the Licensed Products shall be borne, and paid
directly, by LICENSEE. All payments shall be in U.S. dollars,
from a U.S. source approved by NBAP. All computations and
payments shall be in U.S. dollars, at the spot rate for the
local currency as published in the Wall Street Journal for the
last business day of the preceding month. If LICENSEE shall
fail to timely pay any amount due under this Paragraph,
LICENSEE shall pay interest on such amount at a rate equal to
the lesser of (i) three percent (3%) per annum over the highest
percent rate (announced by Chemical Bank, New York branch)
prevailing during the period between the date the payment first
became due and the date such payment is actually paid or (ii)
the highest rate permitted by law during the period between the
date the payment first became due and the date such payment is
actually paid. The receipt or acceptance by NBAP of any of the
statements furnished or royalties paid by LICENSEE (including
the cashing of any royalty checks) shall not preclude NBAP from
questioning their accuracy at any time, auditing LICENSEE's
books and records pursuant to Paragraph 12 or claiming any
shortfall in royalty payments. In order to assist with NBAp's
annual budget process, by April 15 of each Contract Year,
LICENSEE shall deliver a statement detailing LICENSEE's
projections for sales of each Licensed Product for the
following Contract Year, broken down on a quarterly basis. If
LICENSEE fails to comply with reporting requirements contained
in this Paragraph, NBAP may charge LICENSEE, and LICENSEE shall
pay, two thousand U.S. dollars (USD 2,000) for each instance of
non-compliance with this Paragraph.
(b) No Cross Collateralization: Any royalty payment for unit of
Licensed Product sold shall only be applied against the Minimum
Guarantee for such Licensed Product for the Contract Year in
which the unit of such Licensed Product was sold (i.e., any
shortfall in, or payment in excess of, the Minimum Guarantee
for a Contract Year may not be offset or credited against the
Minimum Guarantees for any other Contract Year, against any
other Licensed Product or against any other NBA license
(including premium license agreements entered into pursuant to
Paragraph 5 hereof) held by LICENSEE). If Minimum Guarantees
are stated separately for different categories of Licensed
Products or for different territories, royalty payments
resulting from Net Sales of a category of Licensed Product or
in a particular territory shall be applied only against the
Minimum Guarantee for such category of Licensed Product or
territory.
4. NON-RESTRICTIVE GRANT; RIGHTS RESERVED
Nothing in this Agreement shall prevent NBAP from granting any other
licenses and rights. All rights not specifically granted in this
Agreement are expressly reserved by NBAP. No right of renewal or
option to extend is granted or implied and LICENSEE shall have no
right to continue manufacturing or selling Licensed Products or to
continue holding itself out as a licensee of NBAP after the
expiration or termination of this Agreement except as provided in
Paragraph 14.
5. PREMIUMS
LICENSEE shall not use, nor allow any third party to use, any
Licensed Product as a Premium without the prior written
authorization of NBAP pursuant to a separate agreement with
NBAP. In addition, no Premium shall be offered with the
Licensed Products without the prior written approval of NBAP.
Nothing in this Agreement shall prohibit LICENSEE from
marketing Licensed Products using creative techniques
consistent with industry practice, including, but not limited
to, periodic "specials," "sales," or volume discount prices, so
long as all receipts are accounted for in Net Sales and in
accordance with this Agreement.
6. GOODWILL
LICENSEE recognizes that (i) a portion of the value of the NBA
Marks is attributable to goodwill, (ii) the goodwill attached
to the NBA Marks belongs exclusively to NBAP, the NBA and its
Member Teams and (iii) that such NBA Marks have secondary
meanings in the minds of the public. LICENSEE shall not,
during the Term or thereafter, challenge (y) the property
rights of the Member Teams, whether severally owned or held in
association as the NBA, or NBAP's property rights in and to NBA
Marks, or (z) the validity, legality or enforceability of this
Agreement.
7. PROTECTION OF RIGHTS
(a) Unauthorized Activities: LICENSEE shall promptly notify
NBAP in writing of any infringements of the Licensed Marks
or the Licensed Products or the sale of any Licensed
Products outside the Territory (e.g., unauthorized
importation/exportation of goods) which may come to
LICENSEE's attention. NBAP shall have the sole right to
determine whether or not any action shall be taken on
account of any such infringement or unauthorized
importation/exportation. LICENSEE agrees not to contact
any third party, not to make any demands for claims and
not to institute any suit or action on account of such
infringement or unauthorized importation/exportation
without obtaining the express prior written permission of
NBAP in each instance.
(b) Assistance in Protecting Marks: LICENSEE shall
cooperate to the fullest extent necessary to assist NBAP
in the protection of the rights of NBAP, the NBA and the
Member Teams in and to the Licensed Marks. NBAP shall
reimburse LICENSEE for any reasonable out-of-pocket costs
actually incurred by LICENSEE in providing such
cooperation and assistance. LICENSEE shall cooperate with
NBAP in its enforcement efforts, including being named by
NBAP as a complainant in any action against an infringer.
LICENSEE shall pay to NBAP, and waives all claims to, all
damages or other monetary relief recovered in any such
NBAP-initiated action by reason of a judgment or
settlement (other than for reasonable attorneys' fees and
expenses incurred at NBAP's request) whether or not such
damages or any part of such damages represent or are
intended to represent injury sustained by LICENSEE.
(c) Ownership of Marks: LICENSEE acknowledges that NBAP and/or
the Member Teams are the exclusive owners
of the Licensed Marks. Any intellectual
property rights in the Licensed Marks that
may accrue to LICENSEE shall inure to the
benefit of NBAP and shall be assigned to
NBAP upon its request. Any copyright,
trademark, service xxxx or other right
used, created or procured by LICENSEE with
respect to or involving the Licensed
Marks, derivations or adaptations of the
Licensed Marks, or any word, symbol or
design which users or is similar to the
Licensed Marks so as to suggest
association with or sponsorship by the
NBA, one of its Member Teams or any of
their affiliates, shall be procured for
the benefit of and in NBAP's name, but at
LICENSEE's expense, notwithstanding their
creation by LICENSEE. LICENSEE shall take
all necessary steps to secure an
assignment to NBAP to the copyright from a
creator of work that is not work-for-hire.
Any copyright, trademark or service xxxx
affecting or relating to the Licensed
Marks already procured or applied shall be
assigned to NBAP. LICENSEE shall supply
NBAP with any necessary supporting
materials required to obtain copyright or
trademark registrations of any copyrights
or trademarks required to be assigned to
NBAP under this Agreement.
(d) Notices, Labeling, and Records: NBAP may from time-to-
time designate such copyright, trademark or service xxxx
notices (including the form, location and content of such
notices) that LICENSEE shall cause to appear on or within
each Licensed Product sold, by means of a tag, label,
imprint or other appropriate device, in every instance in
which any Licensed Xxxx is used. The following general
notice (in the English language and the language of the
country where the Licensed Products will be sold) must be
included on a label, the packaging material or on a
separate slip of paper packed with or attached to the
Licensed Product:
"The NBA and individual NBA member team
identifications reproduced on this product are
trademarks and copyrighted designs, and/or other
forms of intellectual property, that are the
exclusive property of NBA Properties, Inc. and the
respective NBA member teams and may not be used, in
whole or in part, without the written consent of NBA
Properties, Inc."
LICENSEE shall (i) cause all Licensed Products to bear the
NBA "official Licensed Product" logo on either the article
or its packaging in such place, and in such prominence, as
NBAP may designate from time-to-time, (ii) faithfully
comply with and adhere to NBAP's mandatory hologram
"Official Licensed Product" identification system or such
other shipment tracking identification and anti-
counterfeiting systems, tags and labels that NBAP may
establish from time-to-time, (iii) unless approved in
writing by NBAP, not cross-license or otherwise use other
licensed properties or other Marks with the Licensed
Products or Licensed Marks and (iv) keep appropriate
records, and advise NBAP, of the date when each of the
Licensed Products is first placed on sale or sold in each
country of the Territory and the date of first use in each
country of each different Licensed Xxxx in the Licensed
Products and any promotional or packaging materials.
(e) Recordation and Registered User Applications: With
respect to those countries in which LICENSEE may
distribute and which require applications to register
LICENSEE as a permitted or registered user of the Licensed
Marks, or which require the recordation of this Agreement,
LICENSEE shall execute and deliver to NBAP such
applications, agreements or other documents as may be
necessary. In such event, this Agreement rather than such
agreements will govern any disputes between LICENSEE and
NBAP, and when this Agreement expires or is terminated,
any such other agreement shall also be deemed expired or
terminated.
(f) LICENSEE Trade Names and Trademarks: LICENSEE shall
permanently affix labeling on each Licensed Product or its
packaging, indicating its name, trade name and address so
that the public can identify the supplier of the Licensed
Product. Prior to any distribution or sale of any
Licensed Products, LICENSEE shall advise NBAP in writing
of LICENSEE's trade name or trademarks used on Licensed
Products and the proposed placement of such trade names
and trademarks on the Licensed Products. LICENSEE shall
only sell Licensed Products under mutually agreed upon
trade names or trademarks and with approved copyrighted
designs, shall not incorporate the Licensed Marks into
LICENSEE's corporate or business name or trademark in any
manner whatsoever and shall place its trade names and
trademarks on Licensed Products only as approved by NBAP.
As requested by NBAP, LICENSEE shall supply NBAP, in
advance of shipping any Licensed Products, with at least
twelve (12) copies of each type of its hang tags, labels
and other markings of origin for use in identifying and
authentication Licensed Products in the marketplace.
LICENSEE shall not use, whether during or after the Term,
any Marks: (i) in connection with the Licensed Marks
without NBAP's authorization, (ii) confusingly similar to
the Licensed Marks, or (iii) intended to relate or refer
to the Licensed Marks, the Member Teams or events
involving the NBA or the Member Teams.
8. INDEMNIFICATIONS; INSURANCE
LICENSEE shall be solely responsible for, and shall
defend, hold harmless and indemnify NBAP, NBA
Entertainment, Inc. ("NBPE"), the NBA, its Member Teams
and the National Basketball Players Association ("NBPA")
and their respective affiliates, owners, directors,
governors, officers, employees and agents (collectively
"NBA Parties")against, any claims, demands, causes of
action or damages,including attorneys' fees (collectively,
"Claims"), arising out of: (i) any act or omission of
LICENSEE, (ii) any breach of this Agreement by LICENSEE,
(iii) the manufacture, distribution, advertisement,
promotion, sale, possession or use of any Licensed Product
(including, but not limited to, claims relating to any
defect (whether obvious or hidden and whether or not
present in any sample approved by NBAP) in a Licensed
Product or in any packaging or other materials (including
advertising materials), or to injuries to persons or
property, or to any infringement of any rights of any
other person or entity or to LICENSEE's failure to comply
with applicable laws, regulations and standards) or (iv)
any claim that the use of any design or other graphic
component of any Licensed Product (other than the Licensed
Marks) violates or infringes upon the trademark, copyright
or other intellectual property rights (including trade
dress) of a third party, provided LICENSEE is given prompt
written notice of and shall have the option to undertake
and conduct the defense of any such Claim. In any
instance to which the foregoing indemnities pertain, NBAP
shall cooperate fully with and assist LICENSEE in all
respects in connection with any such defense. LICENSEE
shall reimburse NBAP for all reasonable out-of-pocket
costs actually incurred by NBAP in connection with such
cooperation and assistance. In any instance to which such
indemnities pertain, LICENSEE shall keep NBAP fully
advised of all developments pertaining to such Claim and
shall not enter into a settlement of such Claim or admit
liability or fault without NBAP's prior written approval.
LICENSEE shall obtain and maintain product liability
insurance providing protection for the NBA Parties against
any Claims arising out of any alleged defects in the
Licensed Products or any use of the Licensed Products, in
an amount and providing coverage satisfactory to NBAP
(including the amount of the deductible). Such insurance
shall be carried by an insurer with a rating by A.M. Best
& Co. of A-7 or other rating satisfactory to NBAP. Such
insurance policy shall also provide that NBAP receive
written notice within thirty (30) days prior to the
effective date of the cancellation, non-renewal or any
material change in coverage. In the event LICENSEE has
failed to deliver to NBAP a certificate of such insurance
evidencing satisfactory coverage prior to NBAP's execution
of this Agreement (or fails to maintain such insurance in
accordance with this Paragraph), NBAP shall have the right
to withdraw its consent to use any or all of the Licensed
Marks and/or terminate this Agreement at any time. Such
insurance obligations shall not limit LICENSEE's indemnity
obligations, except to the extent that LICENSEE's
insurance company actually pays NBAP amounts which
LICENSEE would otherwise be obligated to pay NBAP.
(b) NBAP shall be solely responsible for, and shall defend,
hold harmless and indemnify LICENSEE, it directors,
officers, employees and agents against any Claims arising
out of: (i) a claim that the use of the Licensed Marks
as authorized by this Agreement violates or infringes upon
the trademark, copyright or other intellectual property
rights (including trade dress) of a third party in or to
the Licensed Marks or (ii) any breach of this Agreement by
NBAP, provided NBAP is given prompt written notice of and
shall have the option to undertake and conduct the defense
of any such Claim. In any instance to which the foregoing
indemnities pertain, NBAP shall not enter into a
settlement of such Claim or admit liability or fault
without LICENSEE's prior written approval.
9. QUALITY; APPROVALS; SAMPLES
LICENSEE shall cause the Licensed Products to meet and conform
to high standards of style, quality and appearance. In order
to assure NBAP that it is meeting such standards and other
provisions of this Agreement, LICENSEE shall comply with the
following:
(a) Pre-Production: Before commercial production and
distribution of any product bearing a Licensed Xxxx,
LICENSEE shall submit to NBAP all preliminary and proposed
final artwork, three dimensional models (if any),
prototypes, mock-ups, and pre-production samples of each
product, including all styles, colors and variations,
together with its labels, tags, cartons and containers
(including packaging and wrapping materials). All
LICENSEE submissions under this Paragraph shall be
accompanied by forms supplied by NBAP, using one (1) form
for each submission and filling in all necessary
information. NBAP shall approve or disapprove in writing
all submissions, in its sole discretion, before LICENSEE
shall be entitled to distribute, advertise, use, produce
commercial quantities of or sell any item relating to any
such submission. Any article actually submitted and not
disapproved within sixty (60) days after receipt by NBAP
shall be deemed approved. Approval of an article which
uses a particular artwork does not imply approval of such
artwork with a different article or of such article with
different artwork. LICENSEE acknowledges that NBAP's
approval of an article does not imply approval of, or
license to use, any non-NBA controlled elements contained
in any article. After a sample of an article has been
approved, LICENSEE shall not make any changes without
resubmitting the modified article for NBAP's written
approval.
(b) Production Samples: Before selling or distributing any
product bearing a Licensed Xxxx, LICENSEE shall furnish
NBAP with, at no charge, for its permanent use, two (2)
samples of the product from the first production run of
each manufacturer of the Licensed Products, including all
styles, colors and variations, together with its labels,
tags, cartons and containers (including packaging and
wrapping materials). If such samples do not conform to
all aspects of the Licensed Product as approved or if the
quality of any such sample does not meet the requirements
of this Xxxxxxxxx 0, XXXX shall notify LICENSEE and such
article shall be deemed disapproved and all such articles
shall be promptly destroyed. LICENSEE shall also furnish
NBAP, free of charge, with any additional pieces of
Licensed Product as may reasonable be requested by NBAP to
promote the sale of Official Licensed Products (e.g., for
NBAP's display room, advertisements, catalogs, mailers,
product placement and trade shows) or for comparison with
earlier samples. In addition, LICENSEE shall provide NBAP
with any additional pieces of Licensed Product as may be
required for the permanent use of the Member Teams, not to
exceed one (1) piece per Member Team. If NBAP wishes to
purchase Licensed Products for give-away purposes and not
for resale, LICENSEE shall sell the Licensed Products to
NBAP at LICENSEE's direct manufacturing cost for such
Licensed Products and LICENSEE shall not be required to
pay royalties on such sales to NBAP.
(c) Rejections and Non-Compliance: The rights granted
under this Agreement do not permit the sale of "seconds"
or "irregulars." All submissions or samples not approved
by NBAP shall promptly be destroyed by LICENSEE. LICENSEE
shall advise NBAP regarding the time and place of such
destruction (in sufficient time to arrange for an NBAP
representative to witness such destruction, if NBAP so
desires) and such destruction shall be attested to in a
certificate signed by one of LICENSEE's officers and
submitted to NBAP within fifteen (15) days of the date on
which the sample was not approved. In the event of
LICENSEE's unapproved or unauthorized manufacture,
distribution, use or sale of any products or materials
bearing the Licensed Marks, including promotional and
advertising materials, or the failure of LICENSEE to
comply with Paragraphs 7 (d), 9, 11 (c) or 11 (e), NBAP
shall have the right to: (i) immediately revoke LICENSEE's
rights with respect to any Licensed Product licensed under
this Agreement, (ii) charge LICENSEE two thousand U.S.
dollars (USD 2,000) for each instance (e.g., per unit) of
non-compliance with this Paragraph with respect to any
article, product or material and/or (iii) at LICENSEE's
expense, confiscate or order the destruction of such
unapproved, unauthorized or non-complying products. Such
right(s) shall be without prejudice to any other rights
NBAP may have under this Agreement or otherwise.
(d) Testing: Both before and after Licensed Products are put
on the market, LICENSEE shall follow reasonable and proper
procedures for testing the Licensed Products for
compliance with laws, regulations, standards and
procedures, and shall permit NBAP (upon reasonable notice)
to inspect its and its authorized manufacturer's testing,
manufacturing and quality control records, procedures and
facilities and to test or sample Licensed Products for
compliance with this Paragraph and the other terms and
conditions of this Agreement. Licensed Products found by
NBAP at any time not to comply with applicable laws,
regulations, standards and procedures shall be deemed
disapproved, even if previously approved by NBAP, and
shall not be shipped unless and until LICENSEE can
demonstrate to NBAP's satisfaction that such Licensed
Products have been brought into full compliance.
(e) Revocation of Approval: In the event that: (i) the
quality, appearance or style of any Licensed Product
ceases to be acceptable to NBAP, (ii) LICENSEE uses the
Licensed Marks improperly or violates any term of this
Paragraph 9 or, (iii) NBAP becomes aware of something
relating to any such Licensed Product or LICENSEE which,
in the opinion of NBAP, reflects unfavorably upon the
professional, business or personal reputation of NBAP, the
NBA or any of its Member Teams, then, in any such event,
NBAP shall have the right, in its sole discretion, to
withdraw its approval of such Licensed Product. In the
event of such withdrawal, NBAP shall provide immediate
written notice to LICENSEE and LICENSEE shall cease the
use of the Licensed Marks in connection with the
manufacture, sale, distribution, advertisement or use of
such Licensed Product and such Licensed Product shall
immediately be withdrawn from the market and destroyed;
provided, however, that in the event of a revocation of
approval pursuant to (i) above, NBAP and LICENSEE shall
negotiate in good faith to provide for a reasonable sell-
off period for such Licensed Product and an adjustment to
the Minimum Guarantee for such Licensed Product. Within
ten (10) days after LICENSEE's receipt of such notice,
LICENSEE shall pay all royalties and Minimum Guarantees
due NBAP with respect to the Licensed Product for which
approval has been revoked. If there are other Licensed
Products for which approval has not been withdrawn under
this subparagraph, then this Agreement shall remain in
full force and effect as to such other Licensed Products
deleted from its product lines.
10. PROMOTIONAL MATERIAL
LICENSEE shall not use the Licensed Marks or any
reproduction of the Licensed Marks in any advertising,
promotion or display material in connection with any
product or in any other manner whatsoever without prior
written approval from NBAP. Under no circumstance will
"lotteries," "games of chance" or any other type of
promotion which NBAP believes reflects unfavorably upon
the NBA or its Member Teams be approved. All advertising
or promotional copy and material depicting or using the
Licensed Marks (including display material, catalogs and
press releases) shall be submitted for approval well in
advance of production (but in no event less than ten (10)
business days prior to the start of commercial production)
to allow adequate time for NBAP, in its sole discretion,
to approve, disapprove or comment upon such materials and
for any required changes to be made. By way of example,
no television or cinema advertising containing any
Licensed xxxx xxx be used unless it has been approved in
all stages (i.e., storyboard, production "rough-cut" and
final version). Unless otherwise approved by NBAP, any
NBA game action photographs or footage that LICENSEE uses
in connection with the Licensed Products must be obtained
from NBAE and shall be subject to NBAE's search and edit
charges and any applicable use fee. Any promotional
material submitted that is not approved or disapproved by
NBAP within thirty (30) days of its receipt by NBAP shall
be deemed approved by NBAP.
11. DISTRIBUTION; COMPLIANCE
(a) LICENSEE shall use its best efforts to distribute
and sell, within and throughout the Territory, the
Licensed Products in such manner as may be required
to meet competition by reputable manufacturers of
similar articles. In any ninety (90) day period in
which LICENSEE fails to sell or distribute Licensed
Products in reasonable commercial quantities,
LICENSEE shall be deemed not to have used it best
efforts. LICENSEE shall make and maintain adequate
arrangements for the distribution and timely
delivery of Licensed Products to retailers within
and throughout the Territory. In the event NBAP
advises LICENSEE that a special promotional effort
is to take place in an individual store or chain,
LICENSEE shall use its best efforts to sell the
Licensed Products to said store or chain. In
addition, LICENSEE shall give the Licensed Products
wide distribution and shall not, subject to the
provisions set forth in this Agreement, refrain for
any reason from selling Licensed Products to any
retail outlet within the Territory that may desire
to purchase Licensed Products and whose credit
rating and marketing image warrants such sale.
(b) If LICENSEE desires to have a third party
manufacture or distribute (if permitted under this
Agreement) any Licensed Product, LICENSEE must first
notify NBAP of the name and address of such third
party and of the Licensed Product LICENSEE desires
such a third party to manufacture or distribute.
Attached as Schedule A is a true and complete list
of third party manufacturers and distributors (if
permitted under this Agreement) currently authorized
by NBAP. NBAP shall have the right, in its sole
discretion, to withhold approval for such third
party manufacture or distribution. If NBAP grants
approval for such third party manufacture or
distribution, it may grant such approval pursuant to
an agreement (on a form supplied by NBAP) to be
entered into prior to such manufacture or
distribution among NBAP, LICENSEE and such
manufacturer or distributor which will, among other
things, require that the third party manufacturer or
distributor be subject to all of the terms and
conditions of this Agreement. If NBAP does not
require the third party to enter into a separate
agreement, LICENSEE must provide NBAP with a copy of
its agreement with the third party, which agreement
must provide that it is subject to this Agreement.
If any of LICENSEE's authorized manufacturers or
distributors uses the Licensed Marks for any
unauthorized purpose, LICENSEE shall be responsible
for, and shall cooperate fully and use its best
efforts in stopping, such unauthorized use. Any
change by LICENSEE from a third party manufacturer
or distributor previously approved by NBAP shall
require approval in accordance with this Paragraph.
(c) LICENSEE understand and acknowledges the meanings of
"Counterfeit Goods," "Diverted Goods" and "Parallel
Goods" as set forth in Paragraph 1 above and
LICENSEE shall use all commercially reasonable means
to prevent the creation of any such goods by it
employees, agents, representatives or any others
operating under its direction, supervision or
control and involving the NBA Marks. LICENSEE shall
stamp on all invoices, and shall require any third
party distributors (to whom LICENSEE is authorized
to sell under this Agreement) and any authorized
sublicensees and distributors to stamp on their
invoices, a prominent legend that states that the
Licensed Products are allowed to be sold only within
the Territory and only to an end user. LICENSEE
shall periodically, and at the request of NBAP,
inquire of its authorized distributors, agents and
customers as to whether they are observing
territorial limits and shall periodically report in
writing to NBAP the results of such inquiries.
LICENSEE shall notify NBAP of all orders from, or on
behalf of a customer who LICENSEE knows (or has
reason to know after having made reasonable inquiry)
is located outside the Territory or intends to
resell the Licensed Products outside the Territory.
If LICENSEE knows or has reason to know that any
Licensed Product sold by LICENSEE is resold outside
the Territory, LICENSEE shall compensate NBAP for
the injury to its licensing and distribution program
and shall pay all costs and expenses, including
attorney's fees, required to remove such goods from
the marketplace. Any such monetary damages shall be
in addition to, and not in lieu of, such other
rights and relief (including injunctive relief) as
may be available to NBAP. LICENSEE shall
incorporate within its contracts of sale or sales
orders a provision similar in substance to this
subparagraph and which provides that the obligations
set forth in this subparagraph shall be a continuing
obligation on the resale of the Licensed Products to
subsequent authorized wholesale purchasers and which
makes NBAP a third party beneficiary of such
provision.
(d) In the event LICENSEE sells or distributes other
licensed merchandise of a similar grade or quality
as the Licensed Products, but which do not bear any
of the Licensed Marks, LICENSEE will not
discriminate, in a manner which adversely impacts
the Licensed Products, in the granting of
commissions or discounts to salespeople, dealers and
distributors between the Licensed Products and the
licensed products of any third party. LICENSEE may
not package the Licensed Products in combination
with other products, whether similar or different,
without the prior written approval of NBAP. In the
event that NBAP believes in good faith that LICENSEE
has employed selling or reporting methods which
circumvent or reduce the royalty or other payment or
reporting obligations contained in this Agreement,
NBAP may, in addition to any other rights and
remedies it may have, at its option and upon fifteen
(15) days' prior written notice, adjust the minimum
royalty per unit.
(e) LICENSEE shall at all times conduct all aspects of
its business in a fair and reasonable manner and in
compliance with all shipment tracking,
identification and anti-counterfeiting systems and
labels that NBAP may establish from time-to-time and
all applicable laws, government rules and
regulations, court and administrative decrees and
the highest standard of business ethics then
prevailing in the industry. LICENSEE shall
faithfully comply with and adhere to NBAP's shipping
and distribution policies established from time-to-
time. LICENSEE shall use its commercially
reasonable efforts to ensure that all retailers and
authorized distributors purchasing Licensed Products
comply with NBAP's anti-counterfeiting systems,
labels and shipping and distribution policies
established from time to time.
(f) It shall be LICENSEE's sole responsibility, at its
sole expense, to obtain all approvals (including,
but not limited to, approvals of advertising
materials) of all governmental authorities which may
be necessary in connection with LICENSEE's
performance under this Agreement.
(g) LICENSEE acknowledges that NBAP intends to offer
various NBA and/or Member Team-identified products
for sale in an NBAP-owned "showcase" retail store
("NBA Store"). LICENSEE further acknowledges that
it will receive a variety of tangible and intangible
benefits as a result of having merchandise
manufactured by LICENSEE displayed, sold and
promoted at the NBA Store. Therefore, LICENSEE
shall, in addition to and in consideration for the
license granted under this Agreement and in
consideration of the benefits it will receive from
having merchandise displayed, sold and promoted at
the NBA Store, (i) upon the request of NBAP, perform
contract manufacturing services for NBAP in
connection with the manufacture of products for sale
in the NBA Store on terms mutually agreed upon by
NBAP and LICENSEE and (ii) offer Licensed Products
to the NBA Store on terms at least as favorable as
those offered to LICENSEE's most preferred high-
volume customers, including price, priority of
delivery, discounts, cooperative or other
advertising and promotional allowances and other
benefits (regardless of volume).
12. RECORDS;AUDITS
LICENSEE shall keep accurate books of account and records
covering all transactions relating to the license granted
in this Agreement (including, but not limited to, sales of
Licensed Products, purchases and uses of NBA hologram hang
tags and compliance with shipment tracking, identification
and anti-counterfeiting systems and labels that NBAP may
establish from time to time). NBAP and its authorized
representatives shall have the right, at all reasonable
hours of the day and upon reasonable prior notice, to
examine and audit such books of account and records and
all other documents and materials in LICENSEE's possession
or under its control (including records of LICENSEE's
parents, subsidiaries, affiliates and third parties, if
they are involved in activities which relate to this
Agreement) relating to this Agreement. NBAP shall have
free and full access for such purposes and for the purpose
of making extracts and copies. Should an audit by NBAP
establish a deficiency between the amount found to be due
NBAP and the amount LICENSEE actually paid or reported,
the LICENSEE shall pay the amount of such deficiency, plus
interest at the then current prime rate (as announced by
Chemical Bank, New York branch) from the date such amount
should have been paid until the date of payment. Should
such audit establish a deficiency of more than five
percent (5%), LICENSEE shall also pay for the cost of the
audit. LICENSEE shall pay such amount within thirty (30)
days. All such books of accounts and records shall be
kept available for at least two (2) years after the
expiration or termination of this Agreement, or three (3)
years after the end of the Contract Year to which they
relate, whichever is earlier. In order to facilitate
inspection of its books and records, LICENSEE shall
designate a symbol or number which will be used
exclusively in connection with the Licensed Products on
which royalty payments are payable and shall maintain for
inspection as provided in this Agreement duplicates of all
xxxxxxxx to customers with respect to Licensed Products.
LICENSEE shall, within ten (10) business days of NBAP's
request (which shall not be made more than four (4) times
per Contract Year), furnish NBAP with a list of LICENSEE's
top twenty-five (25) retail accounts for Licensed Products
(on a country by country basis) and their monthly
purchases of Licensed Products (broken down by unit sales
and in dollar volume by retailer). LICENSEE shall supply
NBAP with true and complete copies of any agreement it has
entered into, or in the future enters into, with any
Member Team or any NBA player. In addition, LICENSEE
shall, on a quarterly basis during the Term, provide NBAP
with copies of either (i) financial information furnished
to the United State Securities and Exchange Commission or
(ii) with all financial statements and other financial
information prepared by LICENSEE for distribution to its
banks or other financial lending institutions to whom it
reports regularly. LICENSEE shall cooperate with NBAP in
developing an electronic data interchange through which
NBAP may access LICENSEE's electronic database relating to
the manufacture, distribution and sale of Licensed
Products (such as work-in-progress, finished goods on
hand, orders received, deliveries made and any other on-
line information relating to the Licensed Products) or
developing such other system as will enable NBAP to obtain
such information or facilitate NBAP's review of LICENSEE's
graphic designs for Licensed Products.
13. EARLY TERMINATION
Without prejudice to any other rights NBAP may have
pursuant to this Agreement or otherwise, NBAP shall have
the right to terminate this Agreement at any time if:
(a) Within three (3) months from the date that this
Agreement is executed on behalf of NBAP, LICENSEE
shall not have begun the bona-fide distribution and
sale of each Licensed Product within and throughout
the Territory in accordance with this Agreement.
(b) LICENSEE shall fail to timely remit any payment of
any nature due to NBAP or any of its affiliates when
due and shall fail to cure such non-payment within
thirty (30) days (ten (10) days for a payment
default other than a royalty payment default) of its
receipt of written notice from NBAP; provided,
however, that the LICENSEE shall not have the right
to cure any subsequent payment default.
(c) LICENSEE or any guarantor under this Agreement shall
be unable to pay its liabilities when due, or shall
make any assignment for the benefit of creditors,
or under any applicable law admits in writing its
inability to meet its obligations when due or commit
any other act of bankruptcy, institute voluntary
proceedings in bankruptcy or insolvency or permit
institution of such proceedings against it.
(d) LICENSEE shall exhibit a pattern of frequent failure
to make timely delivery of sufficient quantities of
the Licensed Product to its retail accounts.
(e) LICENSEE (or any entity that controls LICENSEE or is
controlled by LICENSEE) now or in the future holds a
license from NBAP and such license is terminated by
NBAP during the Term.
(f) LICENSEE (i) delivers Licensed Products outside the
Territory; (ii) sells Licensed Products to a third
party who LICENSEE knows, or has reason to know,
intends to deliver the Licensed Products outside the
Territory; or (iii) LICENSEE is in breach of
Paragraph 11 (c).
(g) LICENSEE sells to any third party that LICENSEE
knows, or has reason to know, is altering or
modifying the Licensed Products prior to sale to the
ultimate consumer.
(h) LICENSEE shall fail to perform or shall be in breach
of any other term or condition of this Agreement
(other than a payment default). A termination
pursuant to this subparagraph (h) shall take effect
(i) thirty (30) days after written notice of such
failure to perform or breach is sent by NBAP if such
failure to perform or breach can be Completely Cured
(as defined below) and such failure to perform or
breach has not been Completely Cured during such
thirty (30) day period, or (ii) immediately after
written notice of such failure to perform or breach
is sent by NBAP if such failure to perform or breach
cannot be Completely Cured. For purposes of this
subparagraph, "Completely Cured" means that such
failure to perform or breach is cured so that, in
the reasonable judgment of NBAP, such failure to
perform or breach will have had no effect on, or
caused damage to, NBAP.
In addition to NBAP's other rights and remedies, upon
termination of this Agreement under this Paragraph,
LICENSEE shall pay NBAP (within thirty (30) days of such
termination) the Minimum Guarantees for each Licensed
Product through the end of the Agreement, less the
royalties paid to NBAP through the date of termination.
14. DISPOSAL OF STOCK; EFFECT OF TERMINATION
Sixty (60) days before the expiration of this Agreement
and ten (10) days after any termination under Paragraphs
9 or 13, LICENSEE will furnish to NBAP a certificate
showing the number and description of Licensed Products on
hand or in process of manufacture. After expiration or
termination of this Agreement, LICENSEE shall have no
right to, nor allow any third party to, manufacture,
advertise, distribute, sell, promote or otherwise deal in
any Licensed Products or use the Licensed Marks (and
LICENSEE shall not engage in any such activity) except as
provided below. For a period of ninety (90) days
following the expiration (but not after the termination)
of this Agreement, LICENSEE may sell-off and deliver
Licensed Products which are on hand or in process at the
time of such expiration (the "Sell-Off Period"); provided,
however that (i) the total number of units of each
Licensed Product sold during the Sell-Off Period may not
be greater than one hundred ten percent (110 %) of the
total number of units of such Licensed Product on hand the
same date the preceding Contract Year, (ii) such Licensed
Products may only be sold in accordance with this
Agreement and in the course of business and at regular
selling prices, (iii) all payments then due are first made
to NBAP and (iv) statements and payments are made in
accordance this Agreement. NBAP shall have the option to
conduct physical inventories before the expiration of this
Agreement until the end of the Sell-Off Period in order to
verify such inventory and/or statements. If LICENSEE
refuses to permit such physical inventory, LICENSEE shall
forfeit its right to dispose of Licensed Products under
this Paragraph. After such Sell-Off Period, all inventory
on hand or in process (including all promotional and
packaging materials) will be destroyed. LICENSEE shall
have no sell-off rights in the process (including all
promotional and packing materials) will be destroyed.
Any destruction of Licensed Product required pursuant to
this Agreement shall be attested to in a certificate
signed by one of LICENSEE's officers.
15. EQUITABLE RELIEF
LICENSEE acknowledges that NBAP is entering into this
Agreement not only in consideration of the royalties or
other financial consideration to be paid, but also for the
promotional value and intrinsic benefit resulting from the
manufacture, advertisement, distribution, sale and
promotion of the Licensed Products by LICENSEE in the
Territory. LICENSEE acknowledges that the Licensed marks
possess a special, unique and extraordinary character
which makes difficult the assessment of the monetary
damage which NBAP would sustain as a result of the
unauthorized use of the Licensed Marks. LICENSEE further
acknowledges that: (i) its failure to manufacture,
advertise, distribute, sell and promote the Licensed
Marks, will, in either case, cause immediate and
irreparable damage to NBAP for which NBAP would not have
an adequate remedy at law. Therefore, LICENSEE agrees
that, in the event of a breach of this Agreement by
LICENSEE, in addition to such other legal and equitable
rights and remedies as shall be available to NBAP, NBAP
shall be entitled to injunctive and other equitable
relief, without the necessity of proving damages or
furnishing a bond or other security.
16. NOTICES
All notices and statements to be given and all payments to
be made under this Agreement shall be given or made at the
respective address of the parties as set forth above,
unless notification of a change of address is given in
writing. Any notice of breach or default must be in
writing and sent by facsimile, overnight express delivery,
or registered or certified mail, return receipt requested,
properly addressed and stamped. Any written notice shall
be deemed to have been given at the time it was sent.
17. NO JOINT VENTURE
Nothing in this Agreement shall be construed to place the
parties in the relationship of partners or joint
venturers. Neither party shall have the power to obligate
or bind the other to a third party in any manner
whatsoever.
18. ARBITRATION OF CERTAIN MATTERS
Any dispute or disagreement between the parties relating
solely to the amount of royalty payments owing under this
Agreement shall be settled by arbitration in New York City
under the rules then in effect of the American Arbitration
Association. Judgment upon the award may be entered in
any court having jurisdiction. No other dispute or
disagreement between the parties (including any claim by
NBAP that LICENSEE is using the Licensed Marks in a manner
not authorized by this Agreement or is otherwise in breach
of this Agreement) shall be settled by arbitration. All
decisions by NBAP relating to disapproval of any Licensed
Product or advertising, promotion or display material
shall be final and binding on LICENSEE and shall not be
subject not review in any proceeding.
19. NO USE OF PLAYERS
LICENSEE acknowledges that this Agreement does not grant
to LICENSEE any licenses or rights with respect to the use
of the names, likenesses or other attributes of any NBA
player (collectively "Player Attributes"). The license
granted under this Agreement does not include, and shall
not be used to imply, a testimonial or endorsement of any
Licensed Products by any NBA player. LICENSEE shall not
use Player Attributes in any manner without first
obtaining written authorization from the subject
player(s). LICENSEE shall not enter into any agreement
with any NBA player or any other person which would
require that player or other person to wear or use any
Licensed Product or other product at any NBA game (either
courtside or in any locker room) or at practice.
20. WARRANTIES
Each party represents and warrants that it has the right
and authority to enter into and perform this Agreement and
NBAP represents and warrants that it has the right to
grant the rights to xxx the Licensed Marks in accordance
with the terms and conditions of this Agreement. LICENSEE
represents and warrants that the Licensed Products and all
advertising and promotional materials shall comply with
all applicable laws, regulations and standards. NBAP's
approval of such materials will not imply a representation
or belief that NBAP believes such materials are sufficient
to meet applicable laws, regulations and standards, nor
shall it imply that NBAP agrees with or supports any
claims made by LICENSEE in any advertising materials
relating to the Licensed Products. LICENSEE further
represents and warrants that all advertising and
promotional materials and all graphics used on Licensed
Products will not violate the intellectual property rights
of any third party.
21. SEVERABILITY
In the event any provision of this Agreement is found to
be void, invalid or unenforceable as a result of any
judicial or administrative proceeding or decree, this
Agreement shall be construed and enforced as if such
provision were not contained in this Agreement.
22. MISCELLANEOUS
(a) Assignment: This Agreement and any rights granted
under this Agreement are personal to LICENSEE and
shall not be assigned, sublicensed, subcontracted or
encumbered, directly or indirectly, by law or by
contract, without NBAP's prior written consent,
which consent may, in NBAP's sole discretion, (i) be
contingent upon a fee payable by LICENSEE or the
transferee, the amount of which shall be determined
by NBAP in its sole discretion, and/or (ii) impose
other terms and conditions upon the assignment,
sublicense or transfer. Any transfer of a
controlling interest in LICENSEE or in any party
which currently controls LICENSEE, directly or
indirectly, shall be deemed an assignment prohibited
by the preceding sentence. Any nonconsensual
assignment, sublicense, subcontract or encumbrance
or this Agreement by LICENSEE shall be invalid and
of no force or effect. Upon any such nonconsensual
assignment, sublicense, subcontract or encumbrance,
this Agreement shall terminate, all payment
obligations of LICENSEE hereunder shall be
accelerated and immediately due and payable, and all
rights granted under this Agreement shall
immediately revert to NBAP.
(b) Waiver: None of the provisions of this Agreement
can be waived or modified except expressly by
writing signed by both parties. There are no
representations, promises, agreements, warranties,
covenants or undertakings by either party other than
those contained in this Agreement. No failure on
the part of NBAP to exercise any right under this
Agreement shall operate as a waiver of such right;
nor shall any single or partial exercise of any
right preclude any other or further exercise or the
exercise of any other rights.
(c) Survival: No expiration or termination of this
Agreement shall relieve LICENSEE of its obligation
to pay NBAP any amounts due to NBAP at the time of
termination, regardless of whether these amounts are
then or thereafter payable. The provisions of
Paragraphs 12 and 22(f) shall survive the expiration
or termination of this Agreement.
(d) Adjustments: NBAP shall have the option to
increase the Royalty Rates in the event that, at any
time during the Term, LICENSEE agrees to pay or in
fact pays royalty rates and/or advertising and
promotion contributions with respect to any other
licensed sports or entertainment property in excess
of the Royalty Rate for any Licensed Product
required under this Agreement. From time to time at
NBAP's request, LICENSEE shall deliver a certificate
to NBAP which sets forth the royalty rates and any
advertising and promotion contributions LICENSEE
pays to any other professional sports league or
entertainment property.
(e) Governing Law and Jurisdiction: This Agreement
shall be construed in accordance with the laws of
the State of New York, USA, without regard to its
principles of conflicts of laws. Any claim arising
under this Agreement (except as provided under
Paragraph 18) shall be prosecuted in a federal or
state court of competent jurisdiction located within
the City of New York, USA and LICENSEE consents to
the jurisdiction of such court and to the service of
process by mail.
(f) Confidentiality: Neither party shall (nor shall
they permit or cause their employees or agents to)
divulge, disseminate or publicize information
relating to this Agreement or the financial or other
terms of this Agreement (including any information
on the specifications or methods of reproduction of
the Licensed Marks) to any third party (other than
their respective attorneys or accountants or in the
case of NBAP, the NBA Board of Governors and the
NBPA), except as may be required by law or to
fulfill the terms of this Agreement.
(g) Research: LICENSEE shall cooperate with NBAP's
reasonable requests for information in connection
with conducting marketing tests, surveys and other
research ("Research"), provided that any proprietary
information so furnished shall be kept strictly
confidential by NBAP. If LICENSEE performs or
causes to be performed any Research primarily
dedicated to evaluating or otherwise assessing a
Licensed Product (or any LICENSEE (non-NBA) product
offering similar to a Licensed Product), then copies
of such Research results shall be promptly provided
to NBAP. As may be reasonable requested by NBAP,
LICENSEE shall provide NBAP (or NBAP's designated
third-party researcher) with any Research and
information that LICENSEE has or obtains regarding
its retail accounts.
(h) Construction: This Agreement has been executed in a
text using the English language, which text shall be
controlling. This Agreement together with any
exhibits or attachments, when fully-executed, shall
constitute the entire agreement and understanding
relating to the subject matter of this Agreement
between LICENSEE and the NBA, any Member Team, NBAP
or NBAE. The headings in this Agreement are for
reference purposes only and shall not affect the
interpretation of this Agreement. This Agreement
shall not be binding on NBAP until signed on its
behalf by its President or Senior Vice President,
Business Affairs or such other executive designated
by the President to sign.
Schedule A
Third Party Manufacturers:
Hi-Performance Co. Ltd.
3/F, Xxxxxx Estate Phase 3, Xxxx 0
00 Xxx Xxxx Xxxxxx
Xxxxxxx, Xxxxxxx, Xxxx Xxxx
