[Logo] National Football League Properties, Inc. [Logo]
280 Park Avenue, New York, New York 10017
Area Code (212) 838-0660 FAX (212)681-7599
TERM SHEET
Licensee: Riddell, Inc. Date: May 23, 1995
Address: 3670 N. Milwaukee Ave. No: 641-149-1400
Chicago, IL 60641
The following terms are made part of and are subject to all definitions, terms
and conditions set forth in License No. R03155
MARKETING PROGRAM: NFL Pro Line
TERM: April 1, 1995 - March 31, 1998
TERRITORY: The United States
LICENSED PRODUCTS: NFL PRO LINE HELMETS
FISCAL YEAR LICENSED PRODUCT ROYALTY%
- ----------- ---------------- --------
YEAR I 04/01/95 - 03/31/96 P08389/A100 PRO LINE HELMETS 9.00
YEAR II 04/01/96 - 03/31/97 P08389/A100 PRO LINE HELMETS 9.00
YEAR III 04/01/97 - 03/31/98 P08389/A100 PRO LINE HELMETS 9.00
FISCAL YEAR MINIMUM GUARANTEE ADVANCE
- ----------- ----------------- -------
YEAR I 04/01/95 - 03/31/96 $250,000 $62,500
YEAR II 04/01/96 - 03/31/97 $275,000 $68,750
YEAR III 04/01/97 - 03/31/98 $250,000 $65,000
AUTHORIZED BRANDS FOR
LICENSED PRODUCT(S): Riddell, Riddell and design, R and design
LICENSED MARK(S) FOR
LICENSED PRODUCT(S): Marketing Program logo, Club Marks, and the
following League Marks: "National Football
League", "NFL", "National Football Conference",
"American Football Conference", "NFC", "AFC", and
the NFL Shield design.
DISTRIBUTION CHANNELS FOR
LICENSED PRODUCT(S): Department Stores, Direct Retailers, Fan Shops,
Sporting Goods Stores, Footwear Specialty Stores
PROMOTIONAL PRODUCTS:
FISCAL YEAR LICENSED PRODUCTS NUMBER OF UNITS
- ----------- ----------------- ---------------
YEAR I PRO LINE HELMETS 30
YEAR II PRO LINE HELMETS 30
YEAR III PRO LINE HELMETS 30
BROADCAST EXPOSURE FEE:
FISCAL YEAR AMOUNT PAYMENT DUE DATE(S)
- ----------- ------ -------------------
YEAR I $100,000 To be paid in two (2) equal installments on
or before 06/01/95 and 09/01/95.
YEAR II $110,000 To be paid in two (2) equal installments on
or before 06/01/96 and 09/01/96.
YEAR III $125,000 To be paid in two (2) equal installments on
or before 06/01/97 and 09/01/98.
ASSIGNED MEMBER CLUBS:
FISCAL YEAR MEMBER CLUB EXPOSURE PRODUCTS
- ----------- ----------- -----------------
YEAR I All Member Clubs Helmets
YEAR II All Member Clubs Helmets
YEAR III All Member Clubs Helmets
SPONSORSHIPS:
FISCAL YEAR EVENT SPONSORSHIP FEE PAYMENT DUE DATE(S)
- ----------- ----- --------------- -------------------
YEAR I NFL EXPERIENCE $50,000 To be determined by NFLP
YEAR II NFL EXPERIENCE $50,000 To be determined by NFLP
YEAR III N/A N/A N/A
ADVERTISEMENTS: N/A
COOPERATIVE FUND: N/A
ADDITIONAL TERMS:
YEARS I AND II (only):
- ---------------------
If, in connection with its sponsorship of the NFL Experience, Riddell sets up
the "History of the Helmet" display at the NFL Experience, Licensee's
sponsorship fee will be reduced to twenty five thousand dollars ($25,000).
National Football League Properties, Inc.
[LOGO] 280 Park Avenue, New York, New York 10017
Area Code (212) 838-0660 FAX (212) 681-7599
Retail Licensing Agreement
Licensee: Riddell, Inc. Date: May 23, 1995
Address: 3670 N. Milwaukee Ave. No.: 641-149-1400
Chicago, IL 60641 Lic. No.: RO3155
National Football League Properties, Inc. ("NFLP") has the exclusive right to
license for commercial purposes the trademarks of the National Football League
("NFL") and the thirty professional football teams that comprise the NFL
("Member Clubs"). Licensee, whose name and address are set forth above, desires
to use certain of these trademarks in accordance with the terms and conditions
of this agreement ("License"). In consideration of the mutual premises,
covenants and undertakings contained in this License, the parties to this
License agree as follows:
1. Definitions
As used in this License, the terms listed on the attached Term Sheet and
elsewhere in this License have the following meanings:
a. "Advance Royalty Payment": The amount to be credited to Royalty payments due
for the corresponding Fiscal Year payable to NFLP upon the execution of
this License for Fiscal Year I and on or before April 15 for each
successive Fiscal Year.
b. "Broadcast Exposure Fee": The amount Licensee shall pay to NFLP for on-field
exposure rights for the Exposure Products.
c. "Advertisements": Advertising space in designated NFLP publications to be
purchased by Licensee in accordance with this License.
d. "Affiliate": Any person or entity in which Licensee or any owner, majority
shareholder, officer or director of Licensee has any direct or indirect
beneficial or ownership interest or is a joint venture partner.
e. "Assigned Member Clubs": The Member Clubs for which Licensee shall have
on-field exposure rights for the Exposure Products in accordance with the
terms of Paragraph 18.
f. "Authorized Brands": The only brand names Licensee may use in association
with the Licensed Products.
g. "Club Marks": The full team names, nicknames, helmet designs, uniform
designs, logos, slogans, and other identifying symbols and indicia adopted
for commercial purposes by the Member Clubs.
h. "Cooperative Fund": The amount payable to NFLP during each Fiscal Year for
use by NFLP in connection with the designated Cooperative Program.
i. "Distribution Channels": The channels of trade in the Territory in which
Licensee may distribute for sale or sell each Licensed Product as defined
in Exhibit I attached to this License and/or the attached Term Sheet.
j. "Exposure Products": The Licensed Products for which Licensee shall have
on-field exposure rights for the Assigned Member Clubs.
k. "Fiscal Year": The period beginning on April 1 of any year and ending on
March 31 of the following year except for Fiscal Year I, which will begin
on the date this License is fully-executed and will end on March 31 of the
following year.
l. "League Marks": "National Football League", "NFL", "National Football
Conference", "American Football Conference", "NFC", "AFC", "Super Bowl",
"Pro Bowl", the NFL Shield design, and other identifying symbols and
indicia adopted for commercial purposes by the NFL.
m. "Licensed Marks": The trademarks for which Licensee is granted certain
limited, exclusive rights under this License as set forth in Paragraph 2
below.
n. "Licensed Products": All products for which Licensee may use the Licensed
Marks in association with the Authorized Brands. This license will refer
to each distinct type of product as a "Licensed Product" since more than
one product may be licensed (e.g. T-shirts and jackets would each be a
Licensed Product).
o. "Marketing Program": The program established by NFLP in connection with
which Licensee may use the Licensed Marks as authorized under this License.
Licensee shall abide by all rules, guidelines and policies established by
NFLP for such Marketing Program, which are deemed part of this License.
p. "Member Club Marketing Commitment": The amount Licensee shall pay to NFLP in
exchange for Member Club controlled advertising and promotional inventory
from each Assigned Member Club in such Member Club's local marketing area.
q. "Minimum Royalty Guarantee": The minimum amount of Royalty payments payable
to NFLP on or before the 15th day following the end of each Fiscal Year.
r. "Net Sales": Gross sales of all Licensed Products sold or distributed for
sale at Licensee's invoiced selling price less sales derived from returns
received and credited only. Licensee shall not credit any return at a rate
greater than the original invoiced selling price for such Licensed
Products. There shall be no other deductions allowed including, without
limitation, deductions for manufacturing costs, selling costs,
distribution costs, advertising and promotional costs, quantity discounts,
freight, non-collected or uncollectable accounts, commissions, taxes,
cash discounts, close out sales, distress sales, sales to employees, or
any other costs. For purposes of this Agreement, Net Sales and all other
referenced sales occur when Licensee invoices or ships any Licensed
Product, whichever is earlier. If Net Sales are made to an Affiliate, the
dollar amount gross sales will be the greater of Licensee's regular price
to unaffiliated accounts or the Affiliate's gross sales price to an
unaffiliated account.
s. "NFL Marks": All League Marks and Club Marks, collectively.
t. "Premiums": Any products, including the Licensed Products, bearing the NFL
Marks or other indicia of the NFL or its Member Clubs that Licensee sells
or gives away for the purposes of promoting, publicizing or increasing the
sale of its own products or services other than the Licensed Products, or
that Licensee sells or gives away to any other party whom Licensee knows
or should reasonably know intends to use such products for the purposes
of promoting, publicizing or increasing the sale of any other party's
products or services. Promotions include, without limitation, combination
sales, incentives for sales force, and trade or consumer promotions.
u. "Promotional Products": The quantity of each Licensed Product that Licensee
shall provide to NFLP at no cost during each Fiscal Year for use in
connection with NFLP's Promotional Programs, as defined in Paragraph 5 of
this License.
v. "Royalty": The amount of Net Sales Licensee shall pay to NFLP for all sales
of the Licensed Products. Licensee shall calculate all Royalty payments
according to Net Sales based on Licensee's normal domestic wholesale
warehouse price. NFLP reserves the right to increase the rate of the
Royalty during the Term, provided that it gives Licensee at least six (6)
months written notice before such increase takes effect.
w. "Sponsorship": The designated events for which Licensee will participate as
a sponsor during each Fiscal Year of the Term subject to the execution of
an NFLP Sponsorship Agreement.
x. "Style": A distinct prototype of a Licensed Product that differs from any
other prototype of that same Licensed Product in any form or manner with
respect to design, material, pattern, size, shape, Licensed Marks, or any
other distinguishing characteristic involving the specifications for the
production of all or any portion of that Licensed Product (e.g. T-shirts
bearing the San Francisco 49ers logo and T-shirts bearing the San Diego
Chargers logo would each be a Style of Licensed Product).
y. "Term": The time period for which this License shall be effective.
z. "Territory": The geographic area in which Licensee shall have the right to
sell the Licensed Products.
aa. "Unit": A single Licensed Product (e.g. one T-shirt and one jacket would
each be a Unit).
2. Grant of License
Subject to all of the terms and conditions of this License, NFLP grants
Licensee the exclusive right, except for license agreements between NFLP and
third party licensees preexisting that General Retail Licensing Agreement
dated March 15, 1990 (No. 625-149-1400, License No. R00705) (i.e., Hutch),
to use the Licensed Marks in connection with the manufacture, distribution,
sale, and advertising of the Licensed Products under the Authorized Brand
in the Distribution Channels in the Territory in accordance with all
policies, rules and regulations of the Marketing Program and NFLP, which
are deemed part of this License. Licensee shall have no right to sell or
distribute any Premiums unless Licensee receives a separate Premium License
from NFLP and pays NFLP the applicable Royalty under such Premium License.
Licensee shall not use the Licensed Products as Premiums or permit the use
of the Licensed Products as Premiums by any party whom Licensee knows or
should reasonably know intends to use the Licensed Products as Premiums.
3. Terms of Payment
a. Licensee shall pay NFLP the Royalty on all sales of the Licensed Products.
Regardless of whether any sales occur during any Fiscal Year, Licensee shall
also pay NFLP the applicable Advance Royalty Payment and Minimum Royalty
Guarantee for each Fiscal Year during the Term Advance Royalty Payments and
any payments made to satisfy the Minimum Royalty Guarantee are not
refundable. Licensee may credit the Advance Royalty Payment and Royalty
payments made to NFLP during each Fiscal Year to the Minimum Royalty
Guarantee for the corresponding Fiscal Year only. Licensee may not credit
such amounts to the Advance Royalty Payment, Minimum Royalty Guarantee or
any other payment required under this License for any other Fiscal Year. If
NFLP terminates this License, for the Fiscal Year in which termination
occurs ("Termination Fiscal Year") Licensee shall pay NFLP the Royalty on
all sales of the Licensed Products made during the Termination Fiscal Year
or a pro rated portion of the Minimum Royalty Guarantee owed in excess of
the Advance Royalty Payment ("Termination Guarantee"), whichever is
greater. For purposes of this paragraph the pro rated Minimum Royalty
Guarantee will be calculated as follows:
Termination Guarantee x No. of Days Completed in Termination Fiscal Year
--------------------- ------------------------------------------------
1 365
b. On or before the 15th day of each month, Licensee shall make all Royalty
payments to NFLP due on sales of the Licensed Products during the preceding
calendar month. Simultaneously with the Royalty payment, Licensee shall
furnish full and accurate statements of the Net Sales of each Licensed
Product sold and distributed during such calendar month on forms provided
by NFLP. The statements will include the quantity and description of each
Licensed Product itemized by Member Club if applicable, the gross sales
price, itemized deductions from the gross sales price, any returns made
during the preceding month, and the resulting Net Sales on which Licensee
calculated the Royalty amount. Licensee shall furnish such statements for
each Licensed Product regardless of whether it sold any such Licensed
Product during the preceding month. NFLP's receipt or acceptance of any
statement or Royalty payment or the cashing of a Royalty check will not
preclude NFLP from questioning the correctness of such statements or
payments at any time. Upon discovery of any verifiable inconsistency or
mistake in such statements or payments, Licensee shall immediately rectify
such inconsistency or mistake.
c. Licensee shall pay NFLP all other amounts listed on the Term Sheet attached
to this License in accordance with the dates provided in such Term Sheet.
d. Licensee shall pay NFLP an additional charge of one and one-half percent
(1.5%) per month on any payment due under this License that remains unpaid
fifteen (15) days after such payment becomes due.
4. Quality Control
a. Prior to making any use of any Style of any Licensed Product, Licensee shall
submit to NFLP for its approval at Licensee's sole cost and expense at the
following applicable stages: (i) finished artwork or final proofs; (ii)
pre-production samples or strike-offs for such proposed Style; and (iii) a
sample Unit of the finished version of such Style together with all
packaging, cartons, containers, hangtags and wrapping materials related to
such Unit ("Related Materials"). For Styles that differ solely with respect
to the Licensd Marks, Licensee may submit a sample Unit of one Style along
with artwork of the Styles bearing the other Licensed Marks for approval
purposes unless NFLP requests a sample Unit of each such Style. NFLP shall
use its best efforts to promptly evaluate all such submissions and provide
Licensee, if applicable, with quality standards and specifications for the
finished Units of each Style. Upon approval of the finished version of a
sample Unit of a Style, NFLP shall execute a Product Approval Form that will
contain any applicable quality standards and specifications. License shall
not manufacture, sell, distribute or advertise any Style of a Licensed
Product unless NFLP has executed a Product Approval Form for such Style.
b. All Product Approval Forms are effective for one Fiscal Year only and
Licensee must resubmit to NFLP each Style of each Licensed Product
previously approved by NFLP for quality control approval within thirty (30)
days after the start of each successive Fiscal Year. From time to time, NFLP
may request additional sample Units of any Style of any Licensed Product to
confirm continued compliance with NFLP's quality control guidelines and any
applicable quality standards and specifications. NFLP shall have the right
to withdraw its approval of any Style of any Licensed Product if, in NFLP's
sole judgment, such sample Units cease to conform to such guidelines,
standards or specifications or otherwise deviate in quality from the
previously approved sample Units. Upon notice by NFLP to Licensee that the
Product Approval Form for a Style of a Licensed Product has been withdrawn,
Licensee shall immediately cease to manufacture, distribute, sell or
advertise any further Units of such Style until such time as a new Product
Approval Form has been executed and delivered by NFLP.
c. Licensee shall not make any modification to any Style for which NFLP has
issued a Product Approval Form or depart from any applicable quality
standards and specifications for any Style unless NFLP has approved such
modification for such Style and issues a new Product Approval Form. Licensee
acknowledges that the manufacture, use, sale, distribution, or advertising
of any Style that deviates from the Style approved by NFLP will constitute
a material breach of this License. Upon such breach, NFLP may terminate
this License immediately.
d. No distribution or sale of irregulars or seconds is permitted except when
Licensee receives prior written approval from NFLP.
5. Advertising and Promotional Materials
a. Licensee will not use the Licensed Marks or any reproduction of them,
including without limitation, Photographs or Computer Art, as defined in
Paragraph 10a, in any advertising, promotion, publicity or display materials
(collectively "Promotional Materials") without receiving NFLP's prior
written approval executed on a Promotional Approval Form supplied to
Licensee by NFLP. Licensee may use such approved Promotional Materials only
in conjunction with the Styles of Licensed Products that NFLP has approved.
Licensee shall submit to NFLP all Promotional Materials at the following
applicable stages appropriate to the medium used: (i) conceptual stage,
pre-production art or rough cuts; (ii) layout, storyboard and script; (iii)
finished materials; and (iv) at any other time as reasonably requested by
NFLP. NFLP shall use best efforts to evaluate all such Promotional
Materials' submissions within ten (10) business days of their receipt by
NFLP. NFLP shall execute a Promotional Approval
Form for all Promotional Materials that it approves. Licensee shall notify
its retailers and/or Third Party Distributors that NFLP must approve all
Promotional Materials involving or using in any form or manner the Licensed
Marks. Licensee shall use best efforts to ensure that its retailers and/or
Third Party Distributors do not publish, display or otherwise distribute
such Promotional Materials without NFLP's prior written approval.
b. NFLP has the exclusive right, in its sole discretion, to approve or
disapprove any Promotional Materials' submissions. Licensee acknowledges
that NFLP may disapprove Promotional Materials that, in NFLP's opinion,
reflect unfavorably upon NFLP, the NFL or its Member Clubs including,
without limitation, materials involving gambling, lotteries or other games
inconsistent with the image of the NFL, the Member Clubs, or the Licensed
Products.
c. NFLP may withdraw its approval of any Promotional Materials if: (i) the
Promotional Materials have been altered without the prior written approval
of NFLP; (ii) the Style and/or the Licensed Product promoted in the
Promotional Materials ceases to be approved under this License; or (iii) an
event occurs that, in NFLP's opinion, causes NFLP's relationship with
Licensee or any Licensed Product to adversely reflect upon the professional
or business reputation of the NFL, its Member Clubs or NFLP.
d. Licensee represents that NFLP has the right to conduct promotions and
special events in its sole discretion and to print catalogs, sales sheets
and brochures involving representative merchandise from NFLP's licensees
("Promotional Programs"). Licensee shall supply within ten (10) business
days of any request by NFLP, at no charge to NFLP, all or any portion of the
Promotional Products required by NFLP for use, in NFLP's sole discretion, in
such Promotional Programs.
e. Licensee shall pay NFLP the designated amounts for the Advertisements,
Sponsorship, and Cooperative Fund, if applicable, on or before the
corresponding dates listed on the Term Sheet attached to this License. NFLP
shall use such payments in a manner determined by NFLP in its sole
discretion.
f. During each Fiscal Year of the Term in which NFLP publishes the NFL
Merchandise Catalogue, Licensee shall purchase a full-page advertisement in
such catalogue at the rate established in NFLP's then-existing rate card.
Licensee shall make such payment within fifteen (15) days from receiving an
invoice from NFLP.
6. Distribution Requirements
Licensee shall distribute for sale and sell each Licensed Product only in
the authorized Distribution Channels. Prior to distribution of any Licensed
Product, Licensee shall submit to NFLP a list of its retail accounts for the
Licensed Products for the purpose of determining which accounts fall within
the Distribution Channels. NFLP shall determine, in its sole discretion,
whether such retail accounts fall within the Distribution Channels and
shall provide Licensee with a list of the approved retail accounts.
Licensee shall manufacture, distribute, sell and maintain inventory of
sufficient quantities of each Style of each Licensed Product to meet the
reasonable market demand in the Distribution Channels. Licensee shall not
sell Licensed Products to any third party that Licensee knows or should
reasonably know intends to sell the Licensed Products outside of the
authorized Distribution Channels. If Licensee sells or distributes for sale
other merchandise that does not bear the Licensed Marks but is of the same
grade and quality as the Licensed Products, Licensee shall not discriminate
in the granting of commissions and discounts to salespersons, dealers and
distributors for the sale of the Licensed Products. If the Licensed Marks
are Club Marks, Licensee acknowledges that it shall manufacture, distribute
and sell a commercially significant quantity of Units bearing the trademarks
of each Member Club individually in each Style.
7. Authorized Brands
Licensee shall only use the Authorized Brands, if applicable, in connection
with the manufacture, distribution, sale, and advertising of each Licensed
Product. NFLP shall have the right, in its sole discretion, to remove or
change any of the Authorized Brands, if applicable, during the Term.
Licensee must receive the prior written approval of NFLP to use any other
trademarks on the Licensed Products.
8. NFLP's Purchase of Licensed Products
In addition to the Promotional Products provided at no cost by Licensee,
NFLP, the NFL and its Member Clubs shall have the right to purchase any of
the Licensed Products in any quantity at the minimum wholesale price,
excluding Royalty payments, that Licensee charges to its best customer,
provided that NFLP will not require Licensee to pay a Royalty on such sales.
9. Third Party Relationships
a. Licensee shall not assign, sublicense, transfer or otherwise encumber any
of its rights under this License to any Affiliate or other third party
without NFLP's prior written consent. If Licensee assigns,
sublicenses, transfers or encumbers any portion of this License without
such consent, NFLP shall have the right to terminate this License
immediately.
b. Licensee must receive NFLP's prior written consent to use a domestic or
foreign third party distributor of any Licensed Product ("Third Party
Distributor") or domestic or foreign third party manufacturer of any
Licensed Product or any portion of any Licensed Product, including patches,
labels and emblems made by any party that is not already a licensee of NFLP
("Third Party Manufacturer"). NFLP shall have the right to approve or
disapprove any Third Party Distributor or Third Party Manufacturer in its
sole discretion. In the case of a Third Party Manufacturer, NFLP's approval
of such Third Party Manufacturer, if granted, will be contingent on the
execution of an agreement between NFLP and the approved Third Party
Manufacturer. Notwithstanding such agreement, Licensee shall at all times
remain primarily obligated to NFLP under this License and shall take all
necessary efforts to ensure that such Third Party Manufacturer uses the
Licensed Marks only to manufacture the designated Licensed Product and for
no other purpose including, without limitation, promoting or selling the
Licensed Product. If such Third Party Manufacturer has made an unauthorized
use of the Licensed Marks, Licensee shall fully cooperate with NFLP to
ensure that such unauthorized use ceases promptly. Licensee shall be
primarily obligated to ensure that each Licensed Product produced by such
Third Party Manufacturer complies with the requirements of Paragraph 4 of
this License.
c. Licensee shall not make any payments to any Member Club or to any
shareholder, officer, director, employee, agent or representative of any
Member Club, or to any employee, agent or representative of the NFL or its
affiliates in such person's individual capacity, in connection with the use
of any Licensed Marks under this License or otherwise as a direct result of
sales of any Licensed Product. Licensee shall disclose to NFLP all existing
agreements or agreements being negotiated by Licensee or its agent between
Licensee and any Member Club or any shareholder, officer, director,
employee, agent or representative of any Member Club, or any employee, agent
or representative of the NFL or any of its affiliates in such person's
individual capacity.
d. In the event that NFLP consents to any third party relationship under this
Paragraph 9 or otherwise under this License, Licensee acknowledges that
such approval will be contingent on the execution of an appropriate form or
agreement supplied by NFLP.
10. Computer Artwork and Photographs
a. Subject to the requirements of Paragraph 4, if Licensee wishes to use
computer artwork incorporating graphic depictions of the Licensed Marks
("Computer Art") or photographs owned and/or controlled by NFLP
("Photographs"), Licensee shall request such Computer Art or Photographs in
a Use Application provided to Licensee by NFLP. If NFLP, in its sole
discretion, approves such application, NFLP shall provide Licensee with
Computer Art or Photographs at a rate established by NFLP in its sole
discretion provided that, in the case of Photographs, Licensee must first
sign NFLP's standard Photo Use Agreement. Licensee shall make any payment
for the Computer Art or Photographs within thirty (30) days of receiving an
invoice from NFLP. Licensee shall only use the Computer Art or Photographs
in accordance with the terms and conditions of this
License including, without limitation, Paragraph 11, and, in the case of
Photographs, the Photo Use Agreement. The terms of the executed Photo Use
Agreement will govern in the event of any conflict between the terms of
this License and the terms of the Photo Use Agreement.
b. Licensee shall not make copies of the Computer Art or Photographs without
the express written approval of NFLP and shall not use the Computer Art
or Photographs for any purpose other than the purpose set forth in
Licensee's Use Application. Licensee shall not provide the Computer Art or
Photographs to any other party including a manufacturer, unless NFLP
approves such party in accordance with Paragraph 9 of this License. Licensee
shall take all steps necessary to prevent the unauthorized copying or use of
the Computer Art or Photographs by third parties.
c. Upon the expiration or termination of this License, Licensee shall
immediately deliver to NFLP all Computer Art and Photographs provided by
NFLP and all copies and duplications of such Computer Art or Photographs and
all related materials.
d. Licensee acknowledges that it has no right, title or interest in or to any
of the Photographs, including, without limitation, copyrights in the
Photographs. Licensee represents that it will not assert any rights in or to
the Photographs during the Term of thereafter.
11. Protection of Rights
a. Licensee acknowledges that, as between NFLP and Licensee, NFLP exclusively
owns the NFL Marks and all copyrights, trademarks and other proprietary
rights in and to them. Licensee further acknowledges that NFLP shall own
worldwide in perpetuity: (i) all artwork produced under this License bearing
the NFL Marks ("Artwork") and all copyrights and other proprietary rights
in such Artwork; (ii) all secondary marks and/or promotional concepts
("Secondary Marks") developed for use and used in connection with any
Licensed Product and all copyrights and other proprietary rights in such
Secondary Marks; (iii) all derivative works based on any of the NFL Marks,
Secondary Marks, Computer Art, or Artwork ("Derivative Works") and all
copyrights and other proprietary rights in such Derivative Works; and (iv)
all Computer Art and all copyrights and other proprietary rights in such
Computer Art as well as duplicates and copies of it. Licensee's use of the
Licensed Marks, Computer Art, Artwork, Secondary Marks and Derivative Works
is for NFLP's benefit and Licensee will not acquire any rights in any of
them by such use. Licensee acknowledges that NFLP will have the right to
terminate this License if Licensee asserts any rights in or to any of the
NFL Marks, Computer Art, Artwork, Secondary Marks and Derivative Works other
than those granted under this License. Licensee shall not attack the
trademarks, copyrights or other proprietary rights of NFLP, the NFL, or its
Member Clubs during the Term or thereafter.
b. Any Artwork, Computer Art, Secondary Marks, Derivative Works or other
materials created by Licensee or its agents in connection with this
Agreement shall be performed as a "work made for hire" for NFLP. Licensee
irrevocably assigns and transfers to NFLP all right, title and interest,
including all copyrights and extensions and renewals thereof, in and to the
Artwork, the Secondary Marks, the Derivative Works, the Computer Art, and
all related proprietary rights (collectively the "Proprietary Materials").
At the request of NFLP, Licensee shall execute all documents confirming
NFLP's rights in and to the NFL Marks and Proprietary Materials including
an assignment of copyright in form and substance satisfactory to NFLP.
Licensee shall cause each third party who makes or contributes to the
creation of the Proprietary Materials to agree that all rights, including
the copyrights, in his or her work shall be owned by NFLP whether as a
"work made for hire" or by assignment, as appropriate.
c. Licensee shall only display or use the Licensed Marks in the form and manner
that NFLP has specifically approved in writing. Licensee shall cause to be
irremovably and legibly printed or affixed in a clearly visible location
approved by NFLP on every Unit of each Licensed Product, and all Related
Materials, Proprietary Materials, and Promotional Materials the following:
(i) Trademark Notices as directed and specified by NFLP, including a
legend indicating that the NFL Marks are trademarks of the NFL or the
Member Clubs, and are being used by Licensee under License from NFLP;
(ii) Copyright Notices as directed and specified by NFLP;
(iii) The Marketing Program symbol;
(iv) Hangtags, inserts, holograms, and other identifying material required
by NFLP;
(v) A permanent label displaying Licensee's name and the Authorized
Brand;
(vi) Licensee's name, trade name and address; and
(vii) All other notices required by NFLP to protect the interests of NFLP,
the NFL, and its Member Clubs.
d. Licensee will not use any Trademark or Copyright Notices on the Licensed
Products, Related Materials, Proprietary Materials, and Promotional
Materials that conflict with, negate or cause confusion with any notices
required under this Paragraph 11. Licensee represents that, except for the
Authorized Brands, if applicable, or as otherwise authorized in writing by
NFLP, it will not associate other licensed properties, names, symbols, or
designs with the Licensed Marks on any of the Licensed Products, Related
Materials, Promotional Materials, and Proprietary Materials. Licensee will
not use the Licensed Marks or NFL Marks on any business sign, business card,
invoice, sales sheet, brochure, catalog, or other form, or as part of the
name of Licensee's business except as authorized by NFLP in writing prior to
such usage.
e. NFLP shall have the right to secure trademark and/or copyright registrations
for the NFL Marks. Upon request by NFLP, in addition to any other quantity
of Licensed Products that Licensee must submit to NFLP under this License,
Licensee shall deliver to NFLP, free of cost, twelve (12) Units of each
Licensed Product with their Related Materials for such registration purposes
provided that Licensee shall not owe any Royalty for such Units. Licensee
shall provide NFLP with the date of first use of each Licensed Product in
interstate and intrastate commerce. NFLP shall have the right to secure
trademark and/or copyright registrations in NFLP's name for any Proprietary
Materials created by Licensee or its agents for use in connection with any
Licensed Product. By execution of this License, Licensee appoints NFLP as
Licensee's attorney-in-fact coupled with an irrevocable interest to execute,
acknowledge, deliver and record all registrations and all documents referred
to in this Paragraph 11.
f. Licensee shall assist NFLP, at NFLP's expense, in the procurement,
protection, and maintenance of NFLP's rights in and to the NFL Marks and the
Proprietary Materials. NFLP may, in its sole discretion, commence or
prosecute and control the disposition of any claims or suits relative to
the imitation, infringement and/or unauthorized use of the NFL Marks or the
Proprietary Materials either in its own name, or in the name of Licensee, or
join Licensee as a party in the prosecution of such claims or suits.
Licensee shall cooperate fully with and provide full assistance to NFLP in
connection with any such claims or suits. Licensee shall promptly notify
NFLP in writing of any infringement, imitations, or unauthorized use
of the NFL Marks or Proprietary Materials by others. NFLP shall, in its sole
discretion, determine whether to take action and the type of action, if any,
to take against such infringement. Licensee shall not institute any suit or
take any action on account of such infringements, imitations or unauthorized
uses unless it receives NFLP's prior written consent. NFLP will receive the
full amount of any settlement made or damages awarded in connection with any
action taken against such infringement.
12. Indemnification and Insurance
a. During the Term and thereafter, Licensee shall be solely responsible for,
defend, indemnify and hold harmless NFLP, the NFL, its Member Clubs and
their respective affiliates, shareholders, officers, directors, agents and
employees for, from and against any claims, demands, causes of action,
damages, costs and expenses, including reasonable attorneys' fees,
judgments, and settlements arising out of or in connection with: (i)
Licensee's breach of any of its representations, warranties, covenants or
obligations contained in this License; (ii) Licensee's use of the Licensed
Marks except as provided in subparagraph (c) below; (iii) Licensee's
noncompliance with any applicable federal, state, or local laws or
regulations; or (iv) the manufacture, distribution, sale, advertising or use
of any Licensed Product.
b. Licensee shall obtain and maintain at its own expense from a licensed and
admitted insurance carrier with a rating not less than A from Best, a
product liability insurance policy that will provide coverage of three
million dollars ($3,000,000) for personal injuries arising out of each
occurrence and one million dollars ($1,000,000) for property damage arising
out of each occurrence and an advertising liability insurance policy that
will provide coverage of three million dollars ($3,000,000) for each
occurrence. Licensee shall ensure that such policies: (i) will list the NFL,
its Member Clubs, NFLP, and their respective affiliates, shareholders,
officers, directors, agents, and employees as additional insureds; and (ii)
will each provide that they can not be canceled without at least thirty (30)
days written notice to NFLP. Simultaneously with the execution of this
License, Licensee shall submit to NFLP the fully paid policies or
certificates of insurance. Compliance with this subparagraph (b) will not
relieve Licensee of its other obligations under this Paragraph 12. The
insurance coverage required under this License is not cumulative and will
not extend to any other License or Agreement between Licensee and NFLP
unless otherwise authorized by NFLP in writing.
c. During the Term and thereafter, NFLP shall indemnify and hold harmless
Licensee, its officers, directors, agents and employees for, from and
against any claims, demands, causes of action, damages, and reasonable
attorneys' fees for trademark infringement arising out of the use of the
Licensed Marks as strictly authorized under this License, provided that NFLP
is given immediate notice of and shall have the option to undertake and
conduct the defense of any such claim, demand or cause of action and further
provided that Licensee shall cooperate in the defense of such claim as
reasonably required by NFLP.
13. Financial Information
a. Upon request by NFLP, Licensee shall furnish NFLP within sixty (60) days of
such request a detailed statement by an independent certified public
accountant showing the number and description of the Licensed Products sold
during the Term including an itemization of each Licensed Product by number
of Units sold, Member Club, if applicable, the gross sales price,
itemized deductions from the gross sales price, any returns made, and the
resulting Net Sales on which Licensee calculated the Royalty amount.
b. Within ninety (90) days after the last day of Licensee's fiscal year,
Licensee shall provide NFLP with all pertinent information pertaining to
Licensee's financial condition involving ownership, credit, financial and
other information about Licensee's business including, without limitation,
fiscal year-end financial statements and operating statements certified by
Licensee's chief financial officer as accurate and complete and as
constituting a fair presentation of Licensee's financial condition. Licensee
shall provide NFLP with full and free access to inspect and copy all
business records pertaining to Licensee's financial condition.
c. On or before the 30th day following the end of each calendar quarter,
Licensee shall provide NFLP with Licensee's Fiscal Year projections for
sales and income for the Licensed Products. Upon request by NFLP, Licensee
shall provide NFLP with a list ranking its sales by retailer and/or Third
Party Distributors for its top twenty-five (25) retail accounts or by retail
accounts comprising seventy-five percent (75%) of its Net Sales, whichever
is greater, and itemizing for each such retailer and/or Third Party
Distributors a description and the number of Units of each Licensed Product
sold.
d. Licensee shall notify NFLP in writing of any adverse material change in
Licensee's financial condition that will likely affect its performance under
this License at the time such material change occurs.
14. Audits and Inspections
a. During the Term and for at least three (3) full Fiscal Years after the
expiration or termination of the License, Licensee shall keep, maintain and
preserve complete and accurate books of account and records covering all
transactions relating to this License, including, without limitation,
invoices, correspondence, inventory accounting, banking and financial
records ("Records"). Licensee shall designate a symbol or number that will
be used exclusively on Records relating to the Licensed Products and with
no other articles that Licensee manufactures, distributes or sells. Licensee
shall ensure that all invoices for the sale of Licensed Products to its
retailers and/or Third Party Distributors will include the quantity and
description of each Licensed Product itemized by Marketing Program, Style
and Member Club, if applicable.
b. During the Term and for at least three (3) full Fiscal Years after the
expiration or termination of the License, NFLP and its duly authorized
representatives will have the right during reasonable business hours to
inspect and audit all Records and conduct a physical examination of
Licensee's premises including its warehouses and manufacturing facilities
and those of Third Party Distributors and Third Party Manufacturers. NFLP
shall provide Licensee with no less than five (5) business days' written
notice prior to such inspection, audit or examination; provided however, if
compelling circumstances exist, as determined by NFLP in the exercise of its
reasonable business judgment, NFLP may conduct an immediate inspection,
audit or examination with no prior notice to Licensee. Licensee represents
that it will fully cooperate with the inspection, audit or examination and
will not cause or permit any interference with NFLP or its representatives
during any inspection, audit or examination. During an inspection, audit or
examination, NFLP shall have the right to make copies or extracts of
Licensee's Records.
c. Licensee shall pay NFLP for the cost of any audit that discloses a payment
deficiency of more than two percent (2%) between the amount due to NFLP
pursuant to the audit and the amount Licensee actually paid or reported to
NFLP. Licensee shall pay NFLP any deficiency amount together with interest
on the deficiency amount pursuant to the provisions in Paragraph 3d of this
License. Licensee shall pay such amounts within ten (10) days of invoicing
by NFLP.
15. Termination
Without prejudice to any other rights it may have in law, equity or
otherwise, NFLP shall have the right to immediately terminate this License
upon written notice to Licensee at any time if:
a. Licensee fails to generate Net Sales during any Fiscal Year satisfying the
corresponding Minimum Royalty Guarantee;
b. Licensee fails to deliver to NFLP or to maintain in full force and effect
the insurance coverage referred to in Paragraph 12b of this License;
c. Licensee fails to make available its premises, Records or other business
information to NFLP or its representatives or fails to provide full and
complete information as required in Paragraphs 13 and 14 of this License.
d. Licensee manufactures, sells, distributes, advertises or uses any Style of
any Licensed Product, or any Promotional Materials, or Proprietary Materials
without the prior written approval of NFLP as required in this License, or
after such written approval has been withdrawn by NFLP or has expired;
e. Licensee distributes or sells any Licensed Product outside the Territory or
sells any Licensed Product to a third party that Licensee knows or should
reasonably know intends to sell such Licensed Product outside the Territory;
f. Licensee distributes any Licensed Product outside the corresponding
Distribution Channels, or sells any Licensed Product to any third party that
Licensee knows or should reasonably know intends to sell such Licensed
Product outside the corresponding Distribution Channels;
g. Licensee fails to obtain NFLP's written approval prior to assigning,
sublicensing, transferring, or otherwise encumbering the License or prior to
using a Third Party Manufacturer or Third Party Distributor, or any approved
Third Party Manufacturer or Third Party Distributor engages in conduct that
would entitle NFLP to terminate the License if Licensee had engaged in such
conduct;
h. Licensee makes a material misrepresentation or omission in its license
application form;
i. Licensee fails to make any payment or deliver any statement required under
this License and fails to correct such default within ten (10) days of
written notice of such default;
k. Licensee makes or agrees to make a payment to any Member Club or any
shareholder, officer, director, employee, agent, or representative of a
Member Club, or to any agent, representative or employee of the NFL or its
affiliates in such person's individual capacity, in connection with the use
of any Licensed Marks under this License or otherwise as a direct result of
the sales of any Licensed Product, or Licensee fails to disclose to NFLP any
existing agreement or agreement being negotiated by Licensee or Licensee's
agent between Licensee and a Member Club or any shareholder, officer,
director, employee, agent, or representative of a Member Club, or any agent,
representative or employee of the NFL or its affiliates in such person's
individual capacity;
l. Licensee disparages NFLP, the NFL, any of its Member Clubs, or any of their
respective shareholders, officers, directors and employees as determined by
NFLP in its sole discretion, or otherwise engages in conduct that NFLP deems
detrimental to the NFL or any of its Member Clubs;
m. Licensee fails, in any way, to comply with the requirements of Paragraph 18;
or
n. Licensee fails to comply with any other material term or condition of this
License.
16. Goodwill and Reputation
Licensee recognizes the great value of the goodwill associated with the NFL
Marks and acknowledges that such goodwill belongs to the Member Clubs and
the NFL, and that such NFL Marks have secondary meaning in the minds of the
public. The nature of the business of NFLP, the NFL, and its Member Clubs,
requires public respect for and trust in the reputation and integrity of the
NFL and its Member Clubs. NFLP may, at its sole option, terminate this
License or withdraw some or all Product Approval Forms or Promotional
Approval Forms by written notice to Licensee if any unanticipated factor,
development or event causes NFLP's continued association with any one or
more Licensed Product or Licensee to adversely reflect upon NFLP, the NFL or
its Member as determined by NFLP in its sole discretion. In the event of
such termination, Licensee shall pay to NFLP the Royalty on all sales of the
Licensed Products made during the Termination Fiscal Year or the Termination
Guarantee as defined in Paragraph 3a, whichever is greater, and all other
amounts due to NFLP. Upon receipt of such payment, NFLP will reimburse
Licensee for its salvage expenses or, in the case of unsalvageable Licensed
Products, Licensee's manufacturing costs if NFLP does not permit Licensee to
distribute the remaining inventory of Licensed Products.
17. Effect of Expiration or Termination of the License
a. Sixty (60) days before the expiration of this License, Licensee will furnish
to NFLP a statement showing the number of Units and description of such
Units for each Style of each Licensed Product, Promotional Materials, and
Proprietary Materials on hand or in process in Licensee's inventory. If this
License is terminated by NFLP, Licensee shall furnish such statement within
ten (10) days after notice of termination is given by NFLP.
b. After expiration or termination of this License for whatever reason, all
rights granted under this Licensee will revert to NFLP and Licensee shall
refrain from further use of, simulation of or reference to any and all of
the NFL Marks except as provided in this paragraph. Except for termination
of this License by NFLP, Licensee will have ninety (90) days to dispose of
the Licensed Products ("Sell-Off Period") that are on hand or in process at
the time of such expiration, provided all statements and payments then due
to NFLP are first made and such sell-off occurs at Licensee's regular
selling price and within the Distribution Channels. During the Sell-Off
Period, Licensee shall submit all payments and statements required under
this License in accordance with the terms and conditions of the License.
c. If Licensee has remaining inventory of the Licensed Products upon the
termination of this License or after the Sell-Off Period, if applicable,
NFLP may, at its option: (i) purchase such inventory at Licensee's cost;
(ii) require Licensee to deliver such inventory to NFLP for destruction at
Licensee's expense; or (iii) require Licensee to destroy such inventory at
Licensee's expense and furnish NFLP with an affidavit signed by an officer
of Licensee attesting to such destruction. NFLP will have the right at any
time before expiration or termination of this License and during the
Sell-Off Period to conduct a physical inventory to, among other things,
verify the quantity and Style of the Licensed Products in Licensee's
inventory. If Licensee refuses to permit such physical examination of the
inventory or fails to provide NFLP with the statement required in
subparagraph a above, Licensee will forfeit its right to any Sell-Off
Period.
d. Upon the termination of this License or immediately after the Sell-Off
Period, Licensee shall deliver to NFLP all Proprietary Materials and
all related materials, including software, created or used by Licensee in
connection with this License and shall, at NFLP's option, destroy or sell
to NFLP at Licensee's cost, any molds, plates and other items used to
reproduce the Licensed Marks.
18. On-Field Product Exposure
a. Licensee acknowledges that in furtherance of the NFL's policy of control of
game operations, NFLP shall approve any and all visible items worn or used
on-field, including the sidelines, during all pre-season, regular season and
post-season NFL games. Except as otherwise authorized in writing by NFLP or
as otherwise provided in this License, Licensee shall not during the Term or
thereafter agree, contractually or otherwise, with any Member Club, NFL
player, coach, or other Member Club employee, for any individual to wear,
use or promote any commercially identified product on-field, including the
sidelines, during any NFL game.
b. Licensee acknowledges that in furtherance of the NFL's policy of control of
game operations, there are specific rules and regulations regarding the size
of a manufacturer's logo or other commercial identification that may appear
on visible merchandise worn or used on-field, including the sidelines,
during any NFL game. Licensee agrees that it will strictly adhere to the
standards set forth in any and all such rules and regulations with regard
to any of the products that NFLP may, in its sole discretion, authorize
Licensee to have worn or used on-field, including the sidelines, by NFL
players, coaches, or any other Member Club employees during any NFL game.
c. Licensee represents that it has received a copy of and is familiar with
NFLP's NFL Pro Line Policy, which is deemed part of this License. Any breach
by Licensee of any terms and conditions set forth in the NFL Pro Line Policy
shall be considered a material breach of this License. During each Fiscal
Year of the Term, NFLP shall assign on-field and sideline exposure rights
for the Exposure Products to Licensee with the Assigned Member Clubs listed
on the Term Sheet. Licensee acknowledges that NFLP may, in its sole
discretion, assign on a yearly basis on-field and sideline exposure rights
for the remaining Member Clubs to any other NFL Pro Line licensees. Licensee
further acknowledges that NFLP may, in its sole discretion, reassign any of
the Assigned Member Clubs to another NFL Pro Line licensee at any time.
d. During each Fiscal Year of the Term, Licensee shall pay NFLP the Broadcast
Exposure Fee set forth in the Term Sheet attached to this License in
accordance with the payment due dates listed on such sheet. NFLP shall use
such payments in a manner determined by NFLP in its sole discretion.
e. Nothwithstanding any provision of this License to the contrary, the
placement, size, style and other characteristics of the Authorized Brands
currently appearing on the Licensed Products that have received NFLP's
quality control approval in accordance with the terms of Paragraph 4 of this
License are deemed approved and authorized by NFLP.
19. Players and Coaches
Licensee acknowledges that this License does not grant Licensee any rights
with respect to the name, likeness, signature, or other attributes of any
player, coach, or other employee of the NFL. Licensee shall be responsible
for securing whatever rights may be required for the use of such names,
likeness, signatures, or other attributes. Licensee represents that it will
not exercise the rights granted in this License in any manner that will
imply that Licensee has obtained any such rights without separate written
authorization from the appropriate player, coach, or employee.
20. NFL Films
Licensee understands and acknowledges that this License does not grant
Licensee any rights with respect to film or videotape footage of NFL game
action and that Licensee must obtain such footage directly from NFL Films,
Inc. ("NFL Films") on terms and conditions to be mutually agreed upon by
Licensee and NFL Films. If Licensee desires to use such footage in
connection with this License, NFLP must approve the proposed usage and
subject matter of such footage in writing prior to its usage.
21. Information Transmission
If NFLP obtains the capacity to receive computer transmissions of any or all
information required from Licensee under this License during the Term,
Licensee shall begin to provide such information by such computer
transmission as soon as practicably possible.
22. Notices
The parties to this License shall send all notices and statements
required under this License to the respective addresses of the parties
set forth above unless notification of a change of address is given in
writing. Licensee shall direct all notices to NFLP to the Vice President
of the Retail Licensing Department with a copy to the General Counsel of
NFLP. All notices required under this License must be in writing, must
be sent by registered or certified mail, facsimile, or a private
overnight delivery service generally accepted in the industry that
provides evidence of delivery, and shall be deemed to have been given at
the time they are sent.
23. Relationship of Parties
The parties to this License are not partners, joint venturers, or agents
and nothing in this License shall be construed to place them in any such
relationship. Neither party will have the power to obligate or bind the
other in any manner whatsoever. NFLP, the NFL, and its Member Clubs in no
way endorse, certify or guarantee the quality of the Licensed Products.
24. Governing Law and Disputes
This License and any dispute arising under it shall be governed by and
construed in accordance with the laws of the State of New York without
regard to conflict of law principles. All disputes pertaining to this
License shall be decided by a state or federal court located in the City
of New York and Licensee consents to personal jurisdiction in such
courts.
25. Waiver
Neither party to this License can waive or modify any provision of this
License unless such waiver or modification is in a writing signed by
both parties. Licensee acknowledges that NFLP's prior forbearance of any
requirement of this License will not prevent NFLP from subsequently
requiring full and complete compliance with such requirement or from
exercising its rights under this License.
26. Confidentiality
The parties to this License acknowledge that the terms of this License
are confidential and each warrant that neither shall disclose such terms
to any third party other than the disclosing party's accountants, agents
or attorneys or as required by law, without the other party's prior
written consent.
27. Severability
If any paragraph or clause of this License is illegal or invalid or void
for any reason, the remaining paragraphs and clauses of the License will
remain in full force and effect.
28. Release
In consideration of the rights granted under this License, Licensee
releases NFLP, the NFL, its Member Clubs and each of their respective
affiliates, shareholders, officers, directors, agents and employees from
any claims, demands, losses, expenses or damages, whether known or
unknown, arising out of or in connection with or in any manner related to
the manufacture, distribution or sale of products bearing the Licensed
Marks.
29. Execution
Licensee will make an offer to enter into this License by having a duly
authorized officer or representative sign below and return the License
with a check payable to NFLP for the Advance Royalty Payment required
for Fiscal Year I. An acceptance of the offer will occur and a binding
agreement will exist only after an authorized officer or duly authorized
representative of NFLP signs this License and delivers a fully-executed
copy to Licensee. Licensee acknowledges that this Licensee will be deemed
to have been executed in New York City.
30. Reservation of Rights
By entering into this License, neither NFLP nor Licensee is waiving any of
its respective rights as of the date hereof with regard to the
renewability and/or exclusivity of this License or any of the rights
granted hereunder, nor as to any other rights afforded by the Promotional
Rights Agreement dated June 1, 1990, and each of NFLP and Licensee hereby
expressly reserves all such rights, any other provision of this License
notwithstanding. None of the language or provisions contained in this
License shall be construed or interpreted to in any way limit such rights.
Licensee: Riddell, Inc.
By: /s/ David Mauer Date:
(Signature of officer, partner --------------------
or individual duly authorized to sign)
TITLE: Chief Executive Officer
---------------------------------
NATIONAL FOOTBALL LEAGUE PROPERTIES, INC.
By: /s/ J.M. Connelly Date: 7-3-97
(Signature of officer, partner
or individual duly authorized to sign)
TITLE: Sr. V.P.
EXHIBIT I
DISTRIBUTION CHANNELS
The following definitions shall apply to this License:
1. Department Store: A retail store that operates several departments
carrying higher-priced brands of apparel and non-apparel. Examples
include, without limitation, Macy's, Dillards, Nordstrom, Woodward and
Lothrop, JC Penney, Boscov's, Sears, May Co., Federated Group, Carson
Pirie Scott, Dayton Hudson, Bon Ton, Belks, Strawbridge & Clothier,
Jacobson and Bloomingdales.
2. Direct Retailer: An organization, including Licensee, that markets
products directly to consumers without using retail space through the
mediums of television, computer on-line, or catalog. NFLP, in its sole
discretion, may grant Licensee the right to distribute Licensed Products
in all three such mediums or may limit Licensee to one or two such
mediums.
3. Discount Store: A retail store that operates several departments
carrying lower-priced brands of apparel and non-apparel with limited
service. Examples include, without limitation, Wal-Mart, Kmart, Bradlees,
Roses, Hills, Caldor, Venture, Target, Shopko, and Ames.
4. Distributors: Defined as Third Party Distributors in Paragraph 9b of
the License.
5. Drug Store: A retail store that carries as its primary retail items
pharmaceuticals, health and beauty aids, and convenience items.
Examples include, without limitation, OSCO, Walgreen, and Eckert.
6. Fan Shop: A retail store that carries as its primary retail item
licensed products of the NFL, National Basketball Association, National
Hockey League, Major League Baseball, and the National Collegiate
Athletic Association. Examples include, without limitation, Pro Image,
Team Spirit and Stadium Stuff.
7. Footwear Specialty Store: A retail store that carries as its primary
retail item athletic footwear and also carries, in limited quantities,
licensed apparel and headwear. Examples include, without limitation, Foot
Locker, FootAction, and Athletes Foot.
8. Grocery Store. A retail store that carries as its primary retail items
food and household products. Examples include, without limitation, A & P,
Shop Rite, Vons, Jewel, and Food Town.
9. Sporting Goods Store: A retail store that carries as its primary
retail items licensed apparel, athletic footwear and sporting goods
equipment. Examples include, without limitation, Champ's, Herman's,
Koenig's, The Sports Authority, Sportmart, Gart Brothers, and Modells.
[Logo] National Football League Properties, Inc.
280 Park Avenue, New York, New York 10017
Area Code (212) 450-2000 FAX (212)681-7599
LICENSING AGREEMENT TERM SHEET
Licensee: Riddell, Inc. Date: August 14, 1995
Address: 3670 N. Milwaukee Avenue No.: 655-149-1400
Chicago, IL 60641
The following terms are made part of and are subject to all definitions, terms
and conditions set forth in License No. R00705
MARKETING PROGRAM: Play Football
TERM: April 1, 1995 - March 31, 1998
TERRITORY: The United States
LICENSED PRODUCTS: COMPETITIVE QUALITY YOUTH HELMETS, REPLICA HELMETS
(INCLUDING BUT NOT LIMITED TO FULL SIZE REPLICA HELMETS, MINI REPLICA
HELMETS, MINI AUTHENTIC HELMETS, MICRO HELMETS, AND TWO-INCH MINI HELMETS);
BICYCLE HELMETS; NFL/QBC BOP BAG; NOVELTY ITEMS (INCLUDING BUT NOT LIMITED TO
WINDOW DECALS, PLACQUES, DESK SETS)
FISCAL YEAR LICENSED PRODUCT ROYALTY%
- ----------- ---------------- --------
YEAR I 04/01/95 - 03/31/96 P03154/H300 FULL SIZE REPLICA HELMETS 9.00
P03155/H300 YOUTH HELMETS 9.00
P06968/G900 MINI HELMETS REPLICA 9.00
P07019/H300 BICYCLE HELMETS 9.00
P08155/G000 NOVELTY ITEMS 9.00
P08866/J000 NFL/QBC BOP BAG 9.00
P09691/G900 MINI HELMETS AUTHENTIC 9.00
P09692/G900 MICRO HELMETS 9.00
YEAR II 04/01/96 - 03/31/97 P03154/H300 FULL SIZE REPLICA HELMETS 9.00
P03155/H300 YOUTH HELMETS 9.00
P06968/G900 MINI HELMETS REPLICA 9.00
P07019/H300 BICYCLE HELMETS 9.00
P08155/G000 NOVELTY ITEMS 9.00
P08866/J000 NFL/QBC BOP BAG 9.00
P09691/G900 MINI HELMETS AUTHENTIC 9.00
P09692/G900 MICRO HELMETS 9.00
YEAR III 04/01/97 - 03/31/98 P03154/H300 FULL SIZE REPLICA HELMETS 10.00
P03155/H300 YOUTH HELMETS 10.00
P06968/G900 MINI HELMETS REPLICA 10.00
P07019/H300 BICYCLE HELMETS 10.00
P08155/G000 NOVELTY ITEMS 10.00
P09691/G900 MINI HELMETS AUTHENTIC 10.00
P09692/G900 MICRO HELMETS 10.00
30035 TWO-INCH MINI HELMETS 10.00
FISCAL YEAR MINIMUM GUARANTEE ADVANCE
- ----------- ----------------- -------
YEAR I 04/01/95 - 03/31/96 $300,000 $ 75,000
YEAR II 04/01/96 - 03/31/97 $350,000 $ 87,500
YEAR III 04/01/97 - 03/31/98 $500,000 $100,000
AUTHORIZED BRANDS FOR
LICENSED PRODUCTS(S): Riddell, Sharco, Lil Riddell and design, R and
design and Riddell and design
LICENSED MARK(S) FOR
LICENSED PRODUCTS(S): Marketing Program logo, Club Marks, and the
following League Marks: "National Football
League", "NFL", National Football Conference",
"American Football Conference", "NFC", "AFC".
DISTRIBUTION CHANNELS FOR
LICENSED PRODUCT(S): Department Stores, Direct Retailers, Discount
Stores, Distributors, Drug Stores, Fan Shops,
Footwear Specialty Stores, Grocery Stores,
Sporting Goods Stores
PROMOTIONAL PRODUCTS:
FISCAL YEAR LICENSED PRODUCTS
- ----------- -----------------
YEAR I As reasonably required by NFLP.
YEAR II As reasonably required by NFLP.
YEAR III As reasonably required by NFLP.
COOPERATIVE FUND: N/A
ADVERTISEMENTS: N/A
SPONSORSHIPS: N/A
National Football League Properties, Inc.
[NFL LOGO] 280 Park Avenue, New York, New York 10017
Area Code (212) 838-0660 FAX (212) 681-7599
Retail Licensing Agreement
Licensee: Riddell, Inc. Date: August 14, 1995
Address: 3670 N. Milwaukee Avenue No.: 655-149-1400
Chicago, IL 60641 Lic. No.: R00705
National Football League Properties, Inc. ("NFLP") has the exclusive right to
license for commercial purposes the trademarks of the National Football League
("NFL") and the thirty professional football teams that comprise the NFL
("Member Clubs"). Licensee, whose name and address are set forth above, desires
to use certain of these trademarks in accordance with the terms and conditions
of this agreement ("License"). In consideration of the mutual premises,
covenants and undertakings contained in this License, the parties to this
License agree as follows:
1. Definitions
As used in this License, the terms listed on the attached Term Sheet and
elsewhere in this License have the following meanings:
a. "Advance Royalty Payment": The amount to be credited to Royalty payments due
for the corresponding Fiscal Year payable to NFLP upon the execution of this
License for Fiscal Year I and on or before April 15 for each successive
Fiscal Year.
b. "Advertisements": Advertising space in designated NFLP publications to be
purchased by Licensee in accordance with this License.
c. "Affiliate:" Any person or entity in which Licensee or any owner, majority
shareholder, officer or director of Licensee has any direct or indirect
beneficial or ownership interest or is a joint venture partner.
d. "Authorized Brands": The only brand names Licensee may use in association
with the Licensed Products.
e. "Club Marks": The full team names, nicknames, helmet designs, uniform
designs, logos, slogans, and other identifying symbols and indicia adopted
for commercial purposes by the Member Clubs.
f. "Cooperative Fund": The amount payable to NFLP during each Fiscal Year for
use by NFLP in connection with the designated Cooperative Program.
g. "Distribution Channels:" The channels of trade in the Territory in which
Licensee may distribute for sale or sell each Licensed Product as defined in
Exhibit I attached to this License and/or the attached Term Sheet.
h. "Fiscal Year": The period beginning on April 1 of any year and ending on
March 31 of the following year except for Fiscal Year I, which will begin on
the date this License is fully-executed and will end on March 31 of the
following year.
i. "League Marks": "National Football League", "NFL", "National Football
Conference", "American Football Conference", "NFC", "AFC", "Super Bowl", "Pro
Bowl", the NFL Shield design, and other identifying symbols and indicia
adopted for commercial purposes by the NFL.
j. "Licensed Marks": The trademarks for which Licensee is granted certain
limited, exclusive rights with respect to Replica Helmets only and
non-exclusive rights for the remainder of the Licensed Products.
k. "Licensed Products:" All products for which Licensee may use the Licensed
Marks in association with the Authorized Brands. This license will refer to
each distinct type of product as a "Licensed Product" since more than one
product may be licensed (e.g. T-shirts and jackets would each be a Licensed
Product).
l. "Marketing Program": The program established by NFLP in connection with which
Licensee may use the Licensed Marks as authorized under this License.
Licensee shall abide by all rules, guidelines and policies established by
NFLP for such Marketing Program, which are deemed part of this License.
m. "Minimum Royalty Guarantee": The minimum amount of Royalty payments payable
to NFLP on or before the 15th day following the end of each Fiscal Year.
n. "Net Sales": Gross sales of all Licensed Products sold or distributed for
sale at Licensee's invoiced selling price less sales derived from returns
received and credited only. Licensee shall not credit any return at a rate
greater than the original invoiced selling price for such Licensed Products.
There shall be no other deductions allowed including, without limitation,
deductions for manufacturing costs, selling costs, distribution costs,
advertising and promotional costs, quantity discounts, freight, non-collected
or uncollectable accounts, commissions, taxes, cash discounts, close out
sales, distress sales, sales to employeees, or any other costs. For purposes
of this Agreement, Net Sales and all other referenced sales occur when
Licensee invoices or ships any Licensed Product, whichever is earlier. If Net
sales are made to an Affiliate, the dollar amount of gross sales will be the
greater of Licensee's regular price to unaffiliated accounts or the
Affiliate's gross sales price to an unaffiliated account.
o. "NFL Marks": All League Marks and Club Marks, collectively.
p. "Premiums": Any products, including the Licensed Products, bearing the NFL
Marks or other indicia of the NFL or its Member Clubs that Licensee sells or
gives away for the purposes of promoting, publicizing or increasing the sale
of its own products or services other than the Licensed Products, or that
Licensee sells or gives away to any other party whom Licensee knows or should
reasonably know intends to use such products for the purposes of promoting,
publicizing or increasing the sale of any other party's products or services.
Promotions include, without limitation, combination sales, incentives for
sales force, and trade or consumer promotions.
q. "Promotional Products": The quantity of each Licensed Product that Licensee
shall provide to NFLP at no cost during each Fiscal Year for use in
connection with NFLP's Promotional Programs, as defined in Paragraph 5 of
this License.
r. "Royalty": The amount of Net Sales Licensee shall pay to NFLP for all sales
of the Licensed Products. Licensee shall calculate all Royalty payments
according to Net Sales based on Licensee's normal domestic wholesale
warehouse price. NFLP reserves the right to increase the rate of the Royalty
during the Term, provided that it gives Licensee at least six (6) months
written notice before such increase takes effect.
s. "Sponsorhip": The designated events for which Licensee will participate as a
sponsor during each Fiscal Year of the Term subject to the execution of an
NFLP Sponsorship Agreement.
t. "Style": A distinct prototype of a Licensed Product that differs from any
other prototype of that same Licensed Product in any form or manner with
respect to design, material, pattern, size, shape. Licensed Marks, or any
other distinguishing characteristic involving the specifications for the
production of all or any portion of that Licensed Product (e.g. T-shirts
bearing the San Francisco 49ers logo and T-shirts bearing the San Diego
Chargers logo would each be a Style of Licensed Product).
u. "Term": The time period for which this License shall be effective.
v. "Territory": The geographic area in which Licensee shall have the right to
sell the Licensed Products.
w. "Unit": A single Licensed Product (e.g. one T-shirt and one jacket would each
be a Unit).
2. Grant of License
Subject to all of the terms and conditions of this License, NFLP grants
Licensee the non-exclusive right to use the Licensed Marks in connection with
the manufacture, distribution, sale, and advertising of the Licensed Products
under the Authorized Brand in the Distribution Channels in the Territory in
accordance with all policies, rules and regulations of the Marketing Program
and NFLP, which are deemed part of this License except that Licensee shall
have the exclusive right to use the Licensed Marks in connection with the
manufacture, distribution, sale, and advertising of all Replica Helmets,
except for agreements between NFLP and third party licensees preexisting that
General Retail Licensing Agreement dated March 15, 1990 (No. 625-149-1400,
License No. R00705) (i.e., Hutch). Licensee shall have no right to sell or
distribute any Premiums unless Licensee receives a separate Premium Licensee
fron NFLP and pays NFLP the applicable Royalty under such Premium License.
Licensee shall not use the Licensed Products as Premiums or permit the use of
the Licensed Products as Premiums by any party whom Licensee knows or should
reasonably know intends to use the Licensed Products as Premiums.
3. Terms of Payment
Licensee shall pay NFLP the Royalty on all sales of the Licensed Products.
Regardless of whether any sales occur during any Fiscal Year, Licensee shall
also pay NFLP the applicable Advance Royalty Payment and Minimum Royalty
Guarantee for each Fiscal Year during the Term. Advance Royalty Payments and
any payments made to satisfy the Minimum Royalty Guarantee are not
refundable. Licensee may credit the Advance Royalty Payment and Royalty
payments made to NFLP during each Fiscal Year to the Minimum Royalty
Guarantee for the corresponding Fiscal Year only. Licensee may not credit
such amounts to the Advance Royalty Payment, Minimum Royalty Guarantee or any
other payment required under this License for any other Fiscal Year. If NFLP
terminates this License, for the Fiscal Year in which termination occurs
("Termination Fiscal Year") Licensee shall pay NFLP the Royalty on all sales
of the Licensed Products made during the Termination Fiscal Year or a pro
rated portion of the Minimum Royalty Guarantee owed in excess of the Advance
Royalty Payment ("Termination Guarantee"), whichever is greater. For purposes
of this paragraph the pro rated Minimum Royalty Guarantee will be calculated
as follows:
Termination Guarantee x No. of Days Completed in Termination Fiscal Year
--------------------- ------------------------------------------------
1 365
b. On or before the 15th day of each month, Licensee shall make all Royalty
payments to NFLP due on sales of the Licensed Products during the preceding
calendar month. Simultaneously with the Royalty payment, Licensee shall
furnish full and accurate statements of the Net Sales of each Licensed
Product sold and distributed during such calendar month on forms provided by
NFLP. The statements will include the quantity and description of each
Licensed Product itemized by Member Club if applicable, the gross sales
price, itemized deductions from the gross sales price, any returns made
during the preceding month, and the resulting Net Sales on which Licensee
calculated the Royalty amount. Licensee shall furnish such statements for
each Licensed Product regardless of whether it sold any such Licensed Product
during the preceding month. NFLP's receipt or acceptance of any statement or
Royalty payment or the cashing of a Royalty check will not preclude NFLP from
questioning the correctness of such statements or payments at any time. Upon
discovery of any verifiable inconsistency or mistake in such statements or
payments, Licensee shall immediately rectify such inconsistency or mistake.
c. Licensee shall pay NFLP all other amounts listed on the Term Sheet attached
to this License in accordance with the dates provided in such Term Sheet.
d. Licensee shall pay NFLP an additional charge of one and one-half percent
(1.5%) per month on any payment due under this License that remains unpaid
fifteen (15) days after such payment becomes due.
4. Quality Control
Prior to making any use of any Style of any Licensed Product, Licensee shall
submit to NFLP for its approval at Licensee's sole cost and expense at the
following applicable stages: (i) finished artwork or final proofs; (ii)
pre-production samples or strike-offs for such proposed Style; and (iii) a
sample Unit of the finished version of such Style together with all
packaging, cartons, containers, hangtags and wrapping materials related to
such Unit ("Related Materials"). For Styles that differ solely with respect
to the Licensed Marks, Licensee may submit a sample Unit of one Style along
with artwork of the Styles bearing the other Licensed Marks for approval
purposes unless NFLP requests a sample Unit of each such Style. NFLP shall
use its best efforts to promptly evaluate all such submissions and provide
Licensee, if applicable, with quality standards and specifications for the
finished Units of each Style. Upon approval of the finished version of a
sample Unit of a Style, NFLP shall execute a Product Approval Form that will
contain any applicable quality standards and specifications. License shall
not manufacture, sell, distribute or advertise any Style of a Licensed
Product unless NFLP has executed a Product Approval Form for such Style.
b. All Product Approval Forms are effective for one Fiscal Year only and
Licensee must resubmit to NFLP each Style of each Licensed Product previously
approved by NFLP for quality control approval within thirty (30) days after
the start of each successive Fiscal Year. From time to time, NFLP may request
additional sample Units of any Style of any Licensed Product to confirm
continued compliance with NFLP's quality control guidelines and any
applicable quality standards and specifications. NFLP shall have the right to
withdraw its approval of any Style of any Licensed Product if, in NFLP's sole
judgment, such sample Units cease to conform to such guidelines, standards or
specifications or otherwise deviate in quality from the previously approved
sample Units. Upon notice by NFLP to Licensee that the Product Approval Form
for a Style of a Licensed Product has been withdrawn, Licensee shall
immediately cease to manufacture, distribute, sell or advertise any further
Units of such Style until such time as a new Product Approval Form has been
executed and delivered by NFLP.
c. Licensee shall not make any modification to any Style for which NFLP has
issued a Product Approval Form or depart from any applicable quality
standards and specifications for any Style unless NFLP has approved such
modification for such Style and issues a new Product Approval Form. Licensee
acknowledges that the manufacture, use, sale, distribution, or advertising of
any Style that deviates from the Style approved by NFLP will constitute a
material breach of this License. Upon such breach, NFLP may terminate this
License immediately.
d. No distribution or sale of irregulars or seconds is permitted except when
Licensee receives prior written approval from NFLP.
5. Advertising and Promotional Materials
a. Licensee will not use the Licensed Marks or any reproduction of them,
including without limitation, Photographs or Computer Art, as defined in
Paragraph 10a, in any advertising, promotion, publicity or display materials
(collectively "Promotional Materials") without receiving NFLP's prior written
approval executed on a Promotional Approval Form supplied to Licensee by
NFLP. Licensee may use such approved Promotional Materials only in
conjunction with the Styles of Licensed Products that NFLP has approved.
Licensee shall submit to NFLP all Promotional Materials at the following
applicable stages appropriate to the medium used: (i) conceptual stage,
pre-production art or rough cuts; (ii) layout, storyboard and script; (iii)
finished materials; and (iv) at any other time as reasonably requested by
NFLP. NFLP shall use best efforts to evaluate all such Promotional Materials'
submissions within ten (10) business days of their receipt by NFLP. NFLP
shall execute a Promotional Approval Form for all Promotional Materials that
it approves. Licensee shall notify its retailers and/or Third Party
Distributors that NFLP must approve all Promotional Materials involving or
using in any form or manner the Licensed Marks. Licensee shall use best
efforts to ensure that its retailers and/or Third Party Distributors do not
publish, display or otherwise distribute such Promotional Materials without
NFLP's prior written approval.
b. NFLP has the exclusive right, in its sole discretion, to approve or
disapprove any Promotional Materials' submissions. Licensee acknowledges that
NFLP may disapprove Promotional Materials that, in NFLP's opinion, reflect
unfavorably upon NFLP, the NFL or its Member Clubs including,
without limitation, materials involving gambling, lotteries or other games
inconsistent with the image of the NFL, the Member Clubs, or the Licensed
Products.
c. NFLP may withdraw its approval of any Promotional Materials if: (i)
the Promotional Materials have been altered without the prior written
approval of NFLP; (ii) the Style and/or the Licensed Product promoted in
the Promotional Materials ceases to be approved under this License;
or (iii) an event occurs that, in NFLP's opinion, causes NFLP's
relationship with Licensee or any Licensed Product to adversely reflect
upon the professional or business reputation of the NFL, its Member Clubs
or NFLP.
d. Licensee represents that NFLP has the right to conduct promotions
and special events in its sole discretion and to print catalogs, sales
sheets and brochures involving representative merchandise from NFLP's
licensees ("Promotional Programs"). Licensee shall supply within ten
(10) business days of any request by NFLP, at no charge to NFLP, all or
any portion of the quantity of Promotional Products specified on the
Term Sheet required by NFLP for use, in NFLP's sole discretion, in such
Promotional Programs.
e. Licensee shall pay NFLP the designated amounts for the Advertisements,
Sponsorship, and Cooperative Fund, if applicable, on or before the
corresponding dates listed on the Term Sheet attached to this License. NFLP
shall use such payments in a manner determined by NFLP in its sole
discretion.
f. During each Fiscal Year of the Term in which NFLP publishes the NFL
Merchandise Catalogue, Licensee shall purchase a full-page
advertisement in such catalogue at the rate established in NFLP's
then-existing rate card. Licensee shall make such payment within fifteen
(15) days from receiving an invoice from NFLP.
6. Distribution Requirements
Licensee shall distribute for sale and sell each Licensed Product
only in the authorized Distribution Channels. Prior to distribution of
any Licensed Product, Licensee shall submit to NFLP a list of its retail
accounts for the Licensed Products for the purpose of determining which
accounts fall within the Distribution Channels. NFLP shall determine, in
its sole discretion, whether such retail accounts fall within the
Distribution Channels and shall provide Licensee with a list of the
approved retail accounts. Licensee shall manufacture, distribute, sell
and maintain inventory of sufficient quantities of each Style of each
Licensed Product to meet the reasonable market demand in the Distribution
Channels. Licensee shall not sell Licensed Products to any third party that
Licensee knows or should reasonably know intends to sell the Licensed
Products outside of the authorized Distribution Channels. If Licensee sells
or distributes for sale other merchandise that does not bear the Licensed
Marks but is of the same grade and quality as the Licensed Products,
Licensee shall not discriminate in the granting of commissions and discounts
to salespersons, dealers and distributors for the sale of the Licensed
Products. If the Licensed Marks are Club Marks, Licensee acknowledges that
it shall manufacture, distribute and sell a commercially significant
quantity of Units bearing the trademarks of each Member Club individually in
each Style.
7. Authorized Brands
Licensee shall only use the Authorized Brands, if applicable, in
connection with the manufacture, distribution, sale, and advertising of
each Licensed Product. NFLP shall have the right, in its sole
discretion, to remove or change any of the Authorized Brands, if
applicable, during the Term. Licensee must receive the prior written
approval of NFLP to use any other trademarks on the Licensed Products.
8. NFLP's Purchase of Licensed Products
In addition to the Promotional Products provided at no cost by
Licensee, NFLP, the NFL and its Member Clubs shall have the right to
purchase any of the Licensed Products in any quantity at the minimum
wholesale price, excluding Royalty payments, that Licensee charges to
its best customer, provided that NFLP will not require Licensee to pay a
Royalty on such sales.
9. Third Party Relationships
a. Licensee shall not assign, sublicense, transfer or otherwise
encumber any of its rights under this License to any Affiliate or other
third party without NFLP's prior written consent. If Licensee assigns,
sublicenses, transfers or encumbers any portion of this License without
such consent, NFLP shall have the right to terminate this License
immediately.
b. Licensee must receive NFLP's prior written consent to use a domestic
or foreign third party distributor of any Licensed Product ("Third Party
Distributor") or domestic or foreign third party manufacturer of any
Licensed Product or any portion of any Licensed Product, including
patches, labels and emblems made by any party that is not already a
licensee of NFLP ("Third Party Manufacturer"). NFLP consents to
Licensee's use of Smile Industries as a manufacturer of mini-helmets
upon the execution of the Manufacturer's Agreement attached as Exhibit 2
to this License. NFLP shall have the right to approve or disapprove any
Third Party Distributor or Third Party Manufacturer in its sole
discretion. In the case of a Third Party Manufacturer, NFLP's approval of
such Third Party Manufacturer, if granted, will be contingent on the
execution of an agreement between NFLP and the approved Third Party
Manufacturer. Notwithstanding such agreement, Licensee shall at all
times remain primarily obligated to NFLP under this License and shall
take all necessary efforts to ensure that such Third Party Manufacturer
uses the Licensed Marks only to manufacture the designated Licensed
Product and for no other purpose including, without limitation,
promoting or selling the Licensed Product. If such Third Party
Manufacturer has made an unauthorized use of the Licensed Marks,
Licensee shall fully cooperate with NFLP to ensure that such unauthorized
use ceases promptly. Licensee shall be primarily obligated to ensure
that each Licensed Product produced by such Third Party Manufacturer
complies with the requirements of Paragraph 4 of this License.
c. Licensee shall not make any payments to any Member Club or to any
shareholder, officer, director, employee, agent or representative of any
Member Club, or to any employee, agent or representative of the NFL or
its affiliates in such person's individual capacity, in connection with
the use of any Licensed Marks under this License or otherwise as a
direct result of sales of any Licensed Product. Licensee shall disclose
to NFLP all existing agreements or agreements being negotiated by
Licensee or its agent between Licensee and any Member Club or any
shareholder, officer, director, employee, agent or representative of any
Member Club, or any employee, agent or representative of the NFL or any
of its affiliates in such person's individual capacity.
d. In the event that NFLP consents to any third party relationship
under this Paragraph 9 or otherwise under this License, Licensee
acknowledges that such approval will be contingent on the execution of
an appropriate form or agreement supplied by NFLP.
10. Computer Artwork and Photographs
a. Subject to the requirements of Paragraph 4, if Licensee wishes to
use computer artwork incorporating graphic depictions of the Licensed
Marks ("Computer Art") or photographs owned and/or controlled by NFLP
("Photographs"), Licensee shall request such Computer Art or Photographs
in a Use Application provided to Licensee by NFLP. If NFLP, in its sole
discretion, approves such application, NFLP shall provide Licensee with
Computer Art or Photographs at a rate established by NFLP in its sole
discretion provided that, in the case of Photographs, Licensee must
first sign NFLP's standard Photo Use Agreement. Licensee shall make any
payment for the Computer Art or Photographs within thirty (30) days of
receiving an invoice from NFLP. Licensee shall only use the Computer Art
or Photographs in accordance with the terms and conditions of this
License including, without limitation, Paragraph 11, and, in the case of
Photographs, the Photo Use Agreement. The terms of the executed Photo
Use Agreement will govern in the event of any conflict between the terms
of this License and the terms of the Photo Use Agreement.
b. Licensee shall not make copies of the Computer Art or Photographs without
the express written approval of NFLP and shall not use the Computer Art or
Photographs for any purpose other than the purpose set forth in Licensee's
Use Application. Licensee shall not provide the Computer Art or
Photographs to any other party including a manufacturer, unless NFLP
approves such party in accordance with Paragraph 9 of this License. Licensee
shall take all steps necessary to prevent the unauthorized copying or use of
the Computer Art or Photographs by third parties.
c. Upon the expiration or termination of this License, Licensee shall
immediately deliver to NFLP all Computer Art and Photographs provided by
NFLP and all copies and duplications of such Computer Art or Photographs
and all related materials.
d. Licensee acknowledges that it has no right, title or interest in or
to any of the Photographs, including, without limitation, copyrights in
the Photographs. Licensee represents that it will not assert any rights
in or to the Photographs during the Term or thereafter.
11. Protection of Rights
a. Licensee acknowledges that, as between NFLP and Licensee, NFLP
exclusively owns the NFL Marks and all copyrights, trademarks and other
proprietary rights in and to them. Licensee further acknowledges that NFLP
shall own worldwide in perpetuity: (i) all artwork produced under this
License bearing the NFL Marks ("Artwork") and all copyrights and other
proprietary rights in such Artwork; (ii) all secondary marks and/or
promotional concepts ("Secondary Marks") developed for use and used in
connection with any Licensed Product and all copyrights and other
proprietary rights in such Secondary Marks; (iii) all derivative works
based on any of the NFL Marks, Secondary Marks, Computer Art, or Artwork
("Derivative Works") and all copyrights and other proprietary rights in such
Derivative Works; and (iv) all Computer Art and all copyrights and other
proprietary rights in such Computer Art as well as duplicates and copies of
it. Licensee's use of the Licensed Marks, Computer Art, Artwork, Secondary
Marks and Derivative Works is for NFLP's benefit and Licensee will not
acquire any rights in any of them by such use. Licensee acknowledges that
NFLP will have the right to terminate this License if Licensee asserts any
rights in or to any of the NFL Marks, Computer Art, Artwork, Secondary Marks
and Derivative Works other than those granted under this License. Licensee
shall not attack the trademarks, copyrights or other proprietary rights of
NFLP, the NFL, or its Member Clubs during the Term or thereafter.
b. Any Artwork, Computer Art, Secondary Marks, Derivative Works or other
materials created by Licensee or its agents in connection with this
Agreement shall be performed as a "work made for hire" for NFLP. Licensee
irrevocably assigns and transfers to NFLP all right, title and interest,
including all copyrights and extensions and renewals thereof, in and to the
Artwork, the Secondary Marks, the Derivative Works, the Computer Art, and
all related proprietary rights (collectively the "Proprietary Materials").
At the request of NFLP, Licensee shall execute all documents confirming
NFLP's rights in and to the NFL Marks and Proprietary Materials including
an assignment of copyright in form and substance satisfactory to NFLP.
Licensee shall cause each third party who makes or contributes to the
creation of the Proprietary Materials to agree that all rights, including
the copyrights, in his or her work shall be owned by NFLP whether as a "work
made for hire" or by assignment, as appropriate.
c. Licensee shall only display or use the Licensed Marks in the form and manner
that NFLP has specifically approved in writing. Licensee shall cause to be
irremovably and legibly printed or affixed in a clearly visible location
approved by NFLP on every Unit of each Licensed Product, and all Related
Materials, Proprietary Materials, and Promotional Materials the following:
(i) Trademark Notices as directed and specified by NFLP, including a
legend indicating that the NFL Marks are trademarks of the NFL or
the Member Clubs, and are being used by Licensee under License
from NFLP;
(ii) Copyright Notices as directed and specified by NFLP;
(iii) The Marketing Program symbol;
(iv) Hangtags, inserts, holograms, and other identifying material
required by NFLP;
(v) A permanent label displaying Licensee's name and the Authorized
Brand;
(vi) Licensee's name, trade name and address; and
(vii) All other notices required by NFLP to protect the interests of
NFLP, the NFL, and its Member Clubs.
d. Licensee will not use any Trademark or Copyright Notices on the Licensed
Products, Related Materials, Proprietary Materials, and Promotional
Materials that conflict with, negate or cause confusion with any notices
required under this Paragraph 11. Licensee represents that, except for the
Authorized Brands, if applicable, or as otherwise authorized in writing by
NFLP, it will not associate other licensed properties, names, symbols, or
designs with the Licensed Marks on any of the Licensed Products, Related
Materials, Promotional Materials, and Proprietary Materials. Licensee will
not use the Licensed Marks or NFL Marks on any business sign, business card,
invoice, sales sheet, brochure, catalog, or other form, or as part of the
name of Licensee's business except as authorized by NFLP in writing prior to
such usage.
e. NFLP shall have the right to secure trademark and/or copyright registrations
for the NFL Marks. Upon request by NFLP, in addition to any other quantity
of Licensed Products that Licensee must submit to NFLP under this License,
Licensee shall deliver to NFLP, free of cost, twelve (12) Units of each
Licensed Product with their Related Materials for such registration purposes
provided that Licensee shall not owe any Royalty for such Units. Licensee
shall provide NFLP with the date of first use of each Licensed Product in
interstate and intrastate commerce. NFLP shall have the right to secure
trademark and/or copyright registrations in NFLP's name for any Proprietary
Materials created by Licensee or its agents for use in connection with any
Licensed Product. By execution of this License, Licensee appoints NFLP as
Licensee's attorney-in-fact coupled with an irrevocable interest to execute,
acknowledge, deliver and record all registrations and all documents referred
to in this Paragraph 11.
f. Licensee shall assist NFLP, at NFLP's expense, in the procurement,
protection, and maintenance of NFLP's rights in and to the NFL Marks and the
Proprietary Materials. NFLP may, in its sole discretion, commence or
prosecute and control the disposition of any claims or suits relative to the
imitation, infringement and/or unauthorized use of the NFL Marks or the
Proprietary Materials either in its own name, or in the name of Licensee, or
join Licensee as a party in the prosecution of such claims or suits.
Licensee shall cooperate fully with and provide full assistance to NFLP in
connection with any such claims or suits. Licensee shall promptly notify
NFLP in writing of any infringement, imitations, or unauthorized use of the
NFL Marks or Proprietary Materials by others. NFLP shall, in its sole
discretion, determine whether to take action and the type of action, if any,
to take against such infringement. Licensee shall not institute any suit or
take any action on account of such infringements, imitations or unauthorized
uses unless it receives NFLP's prior written consent. NFLP will receive the
full amount of any settlement made or damages awarded in connection with any
action taken against such infringement.
12. Indemnification and Insurance
a. During the Term and thereafter, Licensee shall be solely responsible for,
defend, indemnify and hold harmless NFLP, the NFL, its Member Clubs, and
each of their respective affiliates, shareholders, officers, directors,
agents and employees for, from and against any claims, demands, causes
of action, damages, costs and expenses, including reasonable attorneys'
fees, judgments, and settlements arising out of or in connection with:
(i) Licensee's breach of any of its representations, warranties,
covenants or obligations contained in this License; (ii) Licensee's use of
the Licensed Marks except as provided in subparagraph (c) below;
(iii) Licensee's noncompliance with any applicable federal, state, or local
laws or regulations; or (iv) the manufacture, distribution, sale,
advertising or use of any Licensed Product.
b. Licensee shall obtain and maintain at its own expense from a licensed and
admitted insurance carrier with a rating not less than A from Best, a
product liability insurance policy that will provide coverage of three
million dollars ($3,000,000) for personal injuries arising out of each
occurrence and one million dollars ($1,000,000) for property damage arising
out of each occurrence and an advertising liability insurance policy that
will provide coverage of three million dollars ($3,000,000) for each
occurrence. Licensee shall ensure that such policies: (i) will list the NFL,
its Member Clubs, NFLP, and each of their respective affiliates,
shareholders, officers, directors, agents, and employees as additional
insureds; and (ii) will each provide that they can not be canceled without
at least thirty (30) days written notice to NFLP. Simultaneously with the
execution of this License, Licensee shall submit to NFLP the fully paid
policies or certificates of insurance. Compliance with this subparagraph (b)
will not relieve Licensee of its other obligations under this Paragraph 12.
The insurance coverage required under this License is not cumulative and
will not extend to any other License or Agreement between Licensee and NFLP
unless otherwise authorized by NFLP in writing.
c. During the Term and thereafter, NFLP shall indemnify and hold harmless
Licensee, its officers, directors, agents and employees for, from and
against any claims, demands, causes of action, damages, and reasonable
attorneys' fees for trademark infringement arising out of the use of the
Licensed Marks as strictly authorized under this License, provided that NFLP
is given immediate notice and shall have the option to undertake and conduct
the defense of any such claim, demand or cause of action and further
provided that Licensee shall cooperate in the defense of such claim as
reasonably required by NFLP.
13. Financial Information
a. Upon request by NFLP, Licensee shall furnish NFLP within sixty (60) days of
such request a detailed statement by an independent certified public
accountant showing the number and description of the Licensed Products sold
during the Term including an itemization of each Licensed Product by number
of Units sold, Member Club, if applicable, the gross sales price, itemized
deductions from the gross sales price, any returns made, and the resulting
Net Sales on which Licensee calculated the Royalty Amount.
b. Within ninety (90) days after the last day of Licensee's fiscal year,
Licensee shall provide NFLP with all pertinent information pertaining to
Licensee's financial condition involving ownership, credit, financial and
other information about Licensee's business including, without limitation,
fiscal year-end financial statements and operating statements certified by
Licensee's chief financial officer as accurate and complete and as
constituting a fair presentation of Licensee's financial condition. Licensee
shall provide NFLP with full and free access to inspect and copy all
business records pertaining to Licensee's financial condition.
c. On or before the 30th day following the end of each calendar quarter,
Licensee shall provide NFLP with Licensee's Fiscal Year projections for
sales and income for the Licensed Products. Upon request by NFLP, Licensee
shall provide NFLP with a list ranking its sales by retailer and/or Third
Party Distributors for its top twenty-five (25) retail accounts comprising
seventy-five percent (75%) of its Net Sales, whichever is greater, and
itemizing for each such retailer and/or Third Party Distributors a
description and the number of Units of each Licensed Product sold.
d. Licensee shall notify NFLP in writing of any adverse material change in
Licensee's financial condition that will likely affect its performance under
this License at the time such material change occurs.
14. Audits and Inspections
a. During the Term and for at least three (3) full Fiscal Years after the
expiration or termination of the License, Licensee shall keep, maintain and
preserve complete and accurate books of account and records covering all
transactions relating to this License, including, without limitation,
invoices, correspondence, inventory accounting, banking and financial
records ("Records"). Licensee shall designate a symbol or number that will
be used exclusively on Records relating to the Licensed Products and with no
other articles that Licensee manufactures, distributes or sells. Licensee
shall ensure that all invoices for the sale of Licensed Products to its
retailers and/or Third Party Distributors will include the quantity and
description of each Licensed Product itemized by Marketing Program, Style
and Member Club, if applicable.
b. During the Term and for at least three (3) full Fiscal Years after the
expiration or termination of the License, NFLP and its duly authorized
representatives will have the right during reasonable business hours to
inspect and audit all Records and conduct a physical examination of
Licensee's premises including its warehouses and manufacturing facilities
and those of Third Party Distributors and Third Party Manufacturers.
NFLP shall provide Licensee with no less than five (5) business days'
written notice prior to such inspection, audit or examination, provided
however, if compelling circumstances exist, as determined by NFLP in the
exercise of its reasonable business judgment, NFLP may conduct an immediate
inspection, audit or examination with no prior notice to Licensee. Licensee
represents that it will fully cooperate with the inspection, audit or
examination and will not cause or permit any interference with NFLP or its
representatives during any inspection, audit or examination. During an
inspection, audit or examination, NFLP shall have the right to make copies
or extracts of Licensee's Records.
c. Licensee shall pay NFLP for the cost of any audit that discloses a payment
deficiency of more than two percent (2%) between the amount due to NFLP
pursuant to the audit and the amount Licensee actually paid or reported to
NFLP. Licensee shall pay NFLP any deficiency amount together with interest
on the deficiency amount pursuant to the provisions in Paragraph 3d of this
License. Licensee shall pay such amounts within ten (10) days of invoicing
by NFLP.
15. Termination
Without prejudice to any other rights it may have in law, equity or
otherwise, NFLP shall have the right to immediately terminate this License
upon written notice to Licensee at any time if:
a. Licensee fails to generate Net Sales during any Fiscal Year satisfying the
corresponding Minimum Royalty Guarantee;
b. Licensee fails to deliver to NFLP or to maintain in full force and effect
the insurance coverage referred to in Paragraph 12b of this License;
c. Licensee fails to make available its premises, Records or other business
information to NFLP or its representatives or fails to provide full and
complete information as required in Paragraphs 13 and 14 of this License;
d. Licensee manufactures, sells, distributes, advertises or uses any Style of
any Licensed Product, or any Promotional Materials, or Proprietary Materials
without the prior written approval of NFLP as required in this License, or
after such written approval has been withdrawn by NFLP or has expired;
e. Licensee distributes or sells any Licensed Product outside the Territory or
sells any Licensed Product to a third party that Licensee knows or should
reasonably know intends to sell such Licensed Product outside the Territory;
f. Licensee distributes any Licensed Product outside the corresponding
Distribution Channels, or sells any Licensed Product to any third party that
Licensee knows or should reasonably know intends to sell such Licensed
Product outside the corresponding Distribution Channels;
g. Licensee fails to obtain NFLP's written approval prior to assigning,
sublicensing, transferring, or otherwise encumbering the License or prior to
using a Third Party Manufacturer or Third Party Distributor, or any
approved Third Party Manufacturer or Third Party Distributor engages in
conduct that would entitle NFLP to terminate the License if Licensee had
engaged in such conduct;
h. Licensee makes a material misrepresentation or omission in its license
application form;
i. Licensee fails to make any payment or deliver any statement required under
this License and fails to correct such default within ten (10) days of
written notice of such default;
j. Licensee makes or agrees to make a payment to any Member Club or any
shareholder, officer, director, employee, agent, or representative of a
Member Club, or to any agent, representative or employee of the NFL or its
affiliates in such person's individual capacity, in connection with the use
of any Licensed Marks under this License or otherwise as a direct result of
the sales of any Licensed Product, or Licensee fails to disclose to NFLP any
existing agreement or agreement being negotiated by Licensee or Licensee's
agent between Licensee and a Member Club or any shareholder, officer,
director, employee, agent, or representative of a Member Club, or any agent,
representative or employee of the NFL or its affiliates in such person's
individual capacity;
k. Licensee disparages NFLP, the NFL, any of its Member Clubs, or any of their
respective shareholders, officers, directors and employees as determined by
NFLP in its sole discretion, or otherwise engages in conduct that NFLP
deems detrimental to the NFL or any of its Member Clubs or any shareholder,
officer, director, employee, agent, or representative of a Member Club;
l. Licensee fails, in any way, to comply with the requirements of Paragraph 18;
or
m. Licensee fails to comply with any other material term or condition of this
License.
16. Goodwill and Reputation
Licensee recognizes the great value of the goodwill associated with the NFL
Marks and acknowledges that such goodwill belongs to the Member Clubs and
the NFL, and that such NFL Marks have secondary meaning in the minds of the
public. The nature of the business of NFLP, the NFL and its Member Clubs,
requires public respect for and trust in the reputation and integrity of the
NFL and its Member Clubs. NFLP may, at its sole option, terminate this
License or withdraw some or all Product Approval Forms or Promotional
Approval Forms by written notice to Licensee if any unanticipated factor,
development or event causes NFLP's continued association with any one or
more Licensed Product or Licensee to adversely reflect upon NFLP, the NFL or
its Member Clubs as determined by NFLP in its sole discretion. In the event
of such termination, Licensee shall pay to NFLP the Royalty on all sales of
the Licensed Products made during the Termination Fiscal Year or the
Termination Guarantee as defined in Paragraph 3a, whichever is greater, and
all other amounts due to NFLP. Upon receipt of such payment, NFLP will
reimburse Licensee for its salvage expenses or, in the case of unsalvageable
Licensed Products, Licensee's manufacturing costs if NFLP does not permit
Licensee to distribute the remaining inventory of Licensed Products.
17. Effect of Expiration or Termination of the License
a. Sixty (60) days before the expiration of this License, Licensee will furnish
to NFLP a statement showing the number of Units and description of such
Units for each Style of each Licensed Product, Promotional Materials, and
Proprietary Materials on hand or in process in Licensee's inventory. If
this License is terminated by NFLP, Licensee shall furnish such statement
within ten (10) days after notice of termination is given by NFLP.
b. After expiration or termination of this License for whatever reason, all
rights granted under this Licensee will revert to NFLP and Licensee shall
refrain from further use of, simulation of or reference to any and all of
the NFL Marks except as provided in this paragraph. Except for termination
of this License by NFLP, Licensee will have ninety (90) days to dispose of
the Licensed Products ("Sell-Off Period") that are on hand or in process at
the time of such expiration, provided all statements and payments then due
to NFLP are first made and such Sell-Off occurs at Licensee's regular
selling price and within the Distribution Channels. During the Sell-Off
Period, Licensee shall submit all payments and statements required under
this License in accordance with the terms and conditions of the License.
c. If Licensee has remaining inventory of the Licensed Products upon the
termination of this License or after the Sell-Off Period, if applicable,
NFLP may, at its option: (i) purchase such inventory at Licensee's cost;
(ii) require Licensee to deliver such inventory to NFLP for destruction at
Licensee's expense; or (iii) require Licensee to destroy such inventory at
Licensee's expense and furnish NFLP with an affidavit signed by an officer
of Licensee attesting to such destruction. NFLP will have the right at any
time before expiration or termination of this License and during the
Sell-Off Period to conduct a physical inventory to, among other things,
verify the quantity and Style of the Licensed Products in Licensee's
inventory. If Licensee refuses to permit such physical examination of the
inventory or fails to provide NFLP with the statement required in
subparagraph a above, Licensee will forfeit its right to any Sell-Off
Period.
d. Upon the termination of this License or immediately after the Sell-Off
Period, Licensee shall deliver to NFLP all Proprietary Materials and all
related materials, including software, created or used by Licensee in
connection with this License and shall, at NFLP's option, destroy or sell to
NFLP at Licensee's cost, any molds, plates and other items used to reproduce
the Licensed Marks.
18. On-Field Product Exposure
a. Licensee acknowledges that in furtherance of the NFL's policy of control of
game operations, NFLP shall approve any and all visible items worn or used
on-field, including the sidelines, during all pre-season, regular season and
post-season NFL games. Except as otherwise authorized in writing by NFLP or
as otherwise provided in this License, Licensee shall not during the Term or
thereafter agree, contractually or otherwise, with any Member Club, NFL
player, coach, or other Member Club employee, for any individual to wear,
use or promote any commercially identified product on-field, including the
sidelines, during any NFL game. Notwithstanding any provision of this
License to the contrary, the placement, size, style and other
characteristics of the Authorized Brands currently appearing on the Licensed
Products that have received NFLP's quality control approval in accorance
with the terms of Paragraph 4 of this License are deemed approved and
authorized by NFLP.
19. Players and Coaches
Licensee acknowledges that this License does not grant Licensee any rights
with respect to the name, likeness, signature, or other attributes of any
player, coach, or other employee of the NFL. Licensee shall be responsible
for securing whatever rights may be required for the use of such names,
likeness, signatures, or other attributes. Licensee represents that it will
not exercise the rights granted in this License in any manner that will
imply that Licensee has obtained any such rights without separate written
authorization from the appropriate player, coach, or employee.
20. NFL Films
Licensee understands and acknowledges that this License does not grant
Licensee any rights with respect to film or videotape footage of NFL game
action and that Licensee must obtain such footage directly from NFL Films,
Inc. ("NFL Films") on terms and conditions to be mutually agreed upon by
Licensee and NFL Films. If Licensee desires to use such footage in
connection with this License, NFLP must approve the proposed usage and
subject matter of such footage in writing prior to its usage.
21. Information Transmission
If NFLP obtains the capacity to receive computer transmissions of any or all
information required from Licensee under this License during the Term,
Licensee shall begin to provide such information by such computer
transmission as soon as practicably possible.
22. Notices
The parties to this License shall send all notices and statements required
under this License to the respective addresses of the parties set forth
above unless notification of a change of address is given in writing.
Licensee shall direct all notices to NFLP to the Vice President of the
Retail Licensing Department with a copy to the General Counsel of NFLP. All
notices required under this License must be in writing, must be sent by
registered or certified mail, facsimile, or a private overnight delivery
service generally accepted in the industry that provides evidence of
delivery, and shall be deemed to have been given at the time they are sent.
23. Relationship of Parties
The parties to this License are not partners, joint venturers, or agents and
nothing in this License shall be construed to place them in any such
relationship. Neither party will have the power to obligate or bind the
other in any manner whatsoever. NFLP, the NFL, and its Member Clubs in no
way endorse, certify or guarantee the quality of the Licensed Products.
24. Governing Law and Disputes
This License and any dispute arising under it shall be governed by and
construed in accordance with the laws of the State of New York without
regard to conflict of law principles. All disputes pertaining to this
License shall be decided by a state or federal court located in the City of
New York and Licensee consents to personal jurisdiction in such courts.
25. Waiver
Neither party to this License can waive or modify any provision of
this License unless such waiver or modification is in a writing signed by
both parties. Licensee acknowledges that NFLP's prior forbearance of any
requirement of this License will not prevent NFLP from subsequently
requiring full and complete compliance with such requirement or from
exercising its rights under this License.
26. Confidentiality
The parties to this License acknowledge that the terms of this
License are confidential and each warrant that neither shall disclose
such terms to any third party other than the disclosing party's
accountants, agents or attorneys or as required by law, without the other
party's prior written consent.
27. Severability
If any paragraph or clause of this License is illegal or invalid or
void for any reason, the remaining paragraphs and clauses of the License
will remain in full force and effect.
28. Release
In consideration of the rights granted under this License, Licensee
releases NFLP, the NFL, its Member Clubs and each of their respective
affiliates, shareholders, officers, directors, agents and employees from
any claims, demands, losses, expenses or damages, whether known or
unknown, arising out of or in connection with or in any manner related to
the manufacture, distribution or sale of products bearing the Licensed
Marks.
29. Execution
Licensee will make an offer to enter into this License by having a
duly authorized officer or representative sign below and return the
License with a check payable to NFLP for the Advance Royalty Payment
required for Fiscal Year I. An acceptance of the offer will occur and a
binding agreement will exist only after an authorized officer or duly
authorized representative of NFLP signs this License and delivers a
fully-executed copy to Licensee. Licensee acknowledges that this Licensee
will be deemed to have been executed in New York City.
30. Reservation of Rights
By entering into this License, neither NFLP nor Licensee is waiving
any of its respective rights as of the date hereof with regard to the
renewability and/or exclusivity of this License or any of the rights
granted hereunder, nor as to any other rights afforded by the Promotional
Rights Agreement dated June 1, 1990, and each of NFLP and Licensee hereby
expressly reserves all such rights, any other provision of this License
notwithstanding. None of the language or provisions contained in this
License shall be construed or interpreted to in any way limit such
rights.
Licensee: Riddell, Inc.
By: /s/ David Mauer Date:
(Signature of officer, partner --------------------------
or individual duly authorized
to sign)
TITLE: Chief Executive Officer
---------------------------------
NATIONAL FOOTBALL LEAGUE PROPERTIES, INC.
By: /s/ J.M. Connelly Date: 7-3-97
(Signature of officer, partner
or individual duly authorized
to sign)
TITLE: Sr. V.P.
EXHIBIT I
DISTRIBUTION CHANNELS
The following definitions shall apply to this License:
1. Department Store: A retail store that operates several departments
carrying higher-priced brands of apparel and non-apparel. Examples
include, without limitation, Macy's, Dillards, Nordstrom, Woodward and
Lothrop, JC Penney, Boscov's, Sears, May Co., Federated Group, Carson
Pirie Scott, Dayton Hudson, Bon Ton, Belks, Strawbridge & Clothier,
Jacobson and Bloomingdales.
2. Direct Retailer: An organization, including Licensee, that markets
products directly to consumers without using retail space through the
mediums of television, computer on-line, or catalog. NFLP, in its sole
discretion, may grant Licensee the right to distribute Licensed Products
in all three such mediums or may limit Licensee to one or two such
mediums.
3. Discount Store: A retail store that operates several departments
carrying lower-priced brands of apparel and non-apparel with limited
service. Examples include, without limitation, Wal-Mart, Kmart, Bradlees,
Roses, Hills, Caldor, Venture, Target, Shopko, and Ames.
4. Distributors: Defined as Third Party Distributors in Paragraph 9b of
the License.
5. Drug Store: A retail store that carries as its primary retail items
pharmaceuticals, health and beauty aids, and convenience items. Examples
include, without limitation, OSCO, Walgreen, and Eckert.
6. Fan Shop: A retail store that carries as its primary retail item
licensed products of the NFL, National Basketball Association, National
Hockey League, Major League Baseball, and the National Collegiate
Athletic Association. Examples include, without limitation, Pro Image,
Team Spirit and Stadium Stuff.
7. Footwear Specialty Store: A retail store that carries as its primary
retail item athletic footwear and also carries, in limited quantities,
licensed apparel and headwear. Examples include, without limitation, Foot
Locker, FootAction, and Athletes Foot.
8. Grocery Store: A retail store that carries as its primary retail items
food and household products. Examples include, without limitation, A & P,
Shop Rite, Vons, Jewel, and Food Town.
9. Sporting Goods Store: A retail store that carries as its primary retail
items licensed apparel, athletic footwear and sporting goods equipment.
Examples include, without limitation, Champ's, Herman's, Koenig's, The
Sports Authority, Sportmart, Gart Brothers, and Modells.