LICENSE AGREEMENT
Representing the agreement between
the Sigma Alpha Epsilon Fraternity
an Illinois not for profit corporation
|
Agreement
No. A16530
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and
|
|
Designer
Sports Apparel, Inc.
000
X. Xxxxxx Xxxxxx
Xxxx
X
Xxxxxxxxx,
XX 00000
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THIS
LICENSE
AGREEMENT is
made
and entered into this 4th
day
of
April,
2006, by
and
between the Sigma Alpha Epsilon Fraternity, of PO. Xxx 0000, Xxxxxxxx, Xxxxxxxx,
hereinafter referred to as "FRATERNITY" and
Designer
Sports Apparel, Inc. of
000 X.
Xxxxxx Xxxxxx, Xxxxxxxxx,
XX hereinafter
referred to as"LICENSEE".
WHEREAS,
FRATERNITY has
adopted various distinct insignia for the utilization of the membership of
the FRATERNITY,
some
of
which insignia are the subject of various trademark registrations issued to
FRATERNITY
by
the
United States Patent and Trademark Office, and as a result of long term
utilization of said insignia by members of the FRATERNITY,
considerable
goodwill has inured to the benefit of FRATERNITY;
and
WHEREAS,
LICENSEE desires
to produce or have produced for it, items which will utilize certain of the
insignia of FRATERNITY;
and
WHEREAS,
the
Parties to this License Agreement wish to set forth in writing each and every
term and
condition of FRATERNITY'S
grant
to
licensee of the limited right to utilize certain of the insignia of FRATERNITY.
Now,
THEREFORE, in
consideration of the covenants, conditions and stipulations contained herein,
the
parties
hereto agree as follows:
1. GRANT
OF
LICENSE: For the duration of this agreement and pursuant to each and every
condition hereinafter
set forth,
FRATERNITY
hereby
grants to
LICENSEE
the
non-exclusive right to utilize the following insignia
of
FRATERNITY,
hereinafter
"Insignia":
Greek
letters of Organization,
crest, badge, flag, name "Sigma Alpha Epsilon" and the True Gentlemen
logo.
2. ACKNOWLEDGEMENT
OF PROPRIETARY RIGHTS: LICENSEE
acknowledges
the ownership by FRATERNITY
of
each
of these Insignia and the goodwill associated therewith and agrees that it
will
do nothing inconsistent with such ownership and agrees that all goodwill
associated with the use of the Insignia by LICENSEE
shall
inure to the benefit of FRATERNITY.
LICENSEE agrees
that nothing in this License Agreement shall give LICENSEE
any
right, title or interest in the Insignia other than the limited right to use
the
Insignia of FRATERNITY
and
only
within the scope of each of the terms and conditions of this License Agreement
and
LICENSEE
agrees
that
it will
neither question nor otherwise attack the ownership by FRATERNITY
of
any of
its Insignia, nor will it assist others in doing so.
3. LICENSED
PRODUCTS:
LICENSEE
is
granted the non-exclusive right to utilize the Insignia
specifically referenced in paragraph 1 above only in relation to the following
products: See
appendix A
4. QUALITY
CONTROL: In order to protect the goodwill associated with FRATERNITY and its
Insignia, LICENSEE
agrees that in relation to any of its merchandise utilizing
FRATERNITY'S
Insignia, LICENSEE will maintain the
high
quality associated with FRATERNITY and its licensed merchandise.
LICENSEE
shall not commence marketing of any merchandise utilizing FRATERNITY'S Insignia
until a representative sample, as specified in the Sigma Alpha Epsilon
Fraternity Licensing Application instructions, has been
provided to FRATERNITY and specifically approved in writing by FRATERNITY.
Every
year thereafter, LICENSEE shall
again provide to FRATERNITY representative samples of
any
and
all merchandise which utilizes FRATERNITY'S Insignia
in association with any merchandise which LICENSEE is requesting the right
to
market in association with any
application for renewal of this License Agreement.
Should
any licensed merchandise prove defective or reasonably unacceptable for any
other reason, within a reasonable period of time following purchase of same
and
upon request, LICENSEE shall provide the purchaser with a full refund or
replacement merchandise, whichever the purchaser prefers.
FRATERNITY
has the
right and authority to regularly monitor the quality of any merchandise within
the scope
of this
License Agreement and if in the exercise of
its
discretion, FRATERNITY determines that the quality of any of the
LICENSED merchandise has decreased below FRATERNITY'S standards, including
but
not limited to those described
in
Appendix C, it shall notify LICENSEE in writing of its objections to the quality
of the merchandise, which notice shall advise LICENSEE of the specific
requirements necessary to satisfy FRATERNITY'S quality standards. Following
LICENSEE's
receipt
of said notice, LICENSEE shall immediately cease and desist from the marketing
of any merchandise which
FRATERNITY claims has decreased below FRATERNITY'S quality standards and shall
not resume the marketing of
any such
merchandise until the quality of said merchandise is improved to the extent
of
being in compliance with any reasonable quality control demands imposed by
FRATERNITY.
Following
LICENSEE'S receipt of any notice from FRATERNITY notifying LICENSEE of
objections relating to the quality
of its merchandise, LICENSEE shall have thirty (30) days, or any such longer
period of time agreed upon by the
parties
to resume production of merchandise acceptable to FRATERNITY and upon LICENSEE'S
failure to timely so comply with any of FRATERNItY'S
reasonable quality control demands, this License Agreement shall he immediately
terminable by FRATERNITY.
5. MARKING:
Licensees shall identify each licensed article as an officially licensed product
of FRATERNITY by incorporating the "Greek Licensed Product" seal shown in
Appendix B on a sticker, tag, label, imprint, or other appropriate method.
In
addition, all marketing, promotional and advertising pieces associated with
the
licensed products of
FRATERNITY
must also be represented in the aforementioned manner. The LICENSEE shall also
identify each licensed product with the appropriate service xxxx or trademark
symbol in a manner specified in the artwork provided
by FRATERNITY upon license approval or as otherwise specified from time to
time
in writing by FRATERNITY.
The
"Greek Licensed Product" is the exclusive property of Affinity Marketing
Consultants, Inc. Authorization for use, unless otherwise specified within
the
terms of this
agreement, must be obtained from Affinity Marketing Consultants, Inc. prior
to
use. Affinity Marketing Consultants, Inc. retains the right to reject requested
use of the "Greek Licensed Product" seal.
6.
ROYALTY: In relation to
all merchandise marketed by or on behalf of licensee utilizing any of
FRATERNITY'S Insignia, LICENSEE shall pay to FRATERNITY a royalty calculated
as
follows: $40
annual advance, 8.5% of
gross
sales
Within
thirty (30) days following the end of each
calendar quarter, LICENSEE shall provide FRATERNITY with
a
precise accounting showing the calculation of the royalty owing, along with
payment of the royalty owing for said calendar quarter. The quarterly accounting
shall include sufficient detail to clearly and understandably provide FRATERNITY
with any and all information which is to be taken into account in association
with the calculation of the royalty owing and, if requested by
FRATERNITYin
association with
any
accountings, LICENSEE shall accurately complete and provide FRATERNITY with
any
forms of accounting reasonably specified by FRATERNITY_
Any
royalty or other amount owing from LICENSEE to FRATERNITY which is not paid
within seven (7) days of
the due
date thereof shall accrue interest at the rate of ten (10%) percent per
annum
2
7. RECORD
KEEPING/AUDIT RIGHTS: For a period of at least three (3) years following each
transaction involving
merchandise containing FRATERNITY Insignia, LICENSEE agrees to maintain true,
correct and orderly records in
conformity with reasonably recognized accounting standards, including all
production records, order forms and purchase orders reflecting the total
quantity of licensed merchandise manufactured and the total quantity of licensed
merchandise sold or otherwise distributed, including true, accurate and complete
accounting records of all consideration received by or on
behalf
of LICENSEE in relation to any licensed merchandise produced by or on behalf
of
LICENSEE, as well as any other records
reasonably specified by FRATERNITY.The records to be kept by LICENSEE shall
be
reasonably available for audit or
inspection by or on behalf of FRATERNITY.
The
records to be kept by LICENSEE shall be reasonably available for audit or
inspection by or on behalf of
FRATERNITY.
Should
any such inspection or audit disclose that royalties paid to FRATERNITY were
less than the amount actually owing,
LICENSEE shall forthwith pay to FRATERNITY the deficiency with interest at
the
rate of ten (10%) percent per annum
from the
date when the deficient amount should have been paid to FRATERNITY. Furthermore,
should the audit or inspection disclose that royalties paid by LICENSEE were
intentionally understated in any amount, or unintentionally understated
in an amount of at least five (5%) percent less than the actual royalty owing
for any quarterly period, LICENSEE shall
be
responsible to immediately reimburse FRATERNITY for all fees and expenses
incurred by FRATERNITY in relation to
the
inspection or audit.
8. INSURANCE:
The LICENSEE is obligated to maintain comprehensive general and product
liability insurance protecting against claims of any sort for loss or damage
arising out of the design, manufacture or marketing of licensed products, said
liability insurance to be maintained in the face amount of one million dollars
($1,000,000.00), which policy of
insurance shall name FRATERNITY as a co-insured and shall provide that
FRATERNITY is to be given at least thirty (30)
days
notice from the insurer prior to cancellation or amendment of such insurance
policies. The LICENSEE shall provide FRATERNITY with certificates of insurance
evidencing that the required insurance has been procured before commencing
with the manufacture or marketing of any merchandise bearing insignia of
FRATERNITY. Should the LICENSEE
fail to
maintain the required insurance, FRATERNITY may, but is not required to, procure
same and the LICENSEE shall promptly reimburse FRATERNITY for the cost of
same.
9. DURATION:
This License Agreement shall remain in effect up through the 30th day of June
next following the execution of this agreement and is potentially renewable
on a
year to year basis thereafter in accordance with the next paragraph hereof
unless the FRATERNITY mails written notice to LICENSEE on or before May 31
of
the then current year notifying LICENSEE that this agreement will not be renewed
and will terminate effective June 30 of that year.
10. POTENTIAL
RENEWAL: Unless terminated by FRATERNITY pursuant to any of the terms and
conditions of this License Agreement, this License Agreement is renewable on
a
year to year basis beginning on July 1 of each year, pursuant to the following
conditions:
a.
At
least 30 days prior to July 1 of each year, LICENSEE shall request renewal
in
writing and provide FRATERNITY
with
representative samples of any merchandise which LICENSEE wishes to market
pursuant to a renewal of this License Agreement;
b.
FRATERNITY shall have thirty (30) days to examine said merchandise and in its
sole discretion determine
whether
to authorize renewal of this License Agreement in relation to any or all of
said
proposed items;
c.
Should
FRATERNITY elect to renew this License Agreement in relation to any of the
proposed merchandise, it
will
provide LICENSEE with written notice of the renewal of this License Agreement
effective July 1 along with specification of which items of the proposed
merchandise are approved for the renewal year.
11. DEFAULT:
FRATERNITY shall have
the right to terminate this License Agreement prior to the duration
thereof
pursuant
to the following conditions:
a.
FRATERNITY has the right to immediately terminate this license Agreement through
written notice to LICENSEE
upon the
occurrence of any of the following situations:
(1) Willful
and material falsification
of
any
records required to be maintained or reports required to he provided by the
LICENSEE to FRATERNITY;
(2) Willful
and material deception of customers in relation to the production, marketing
or
other distribution of products containing FRATERNITY Insignia;
(3) LICENSEE
under reports royalties in the amount specified in the last paragraph of section
7 for any three consecutive quarters. Failure of the LICENSEE to maintain
liability insurance in compliance with paragraph 8 of this License Agreement:
3
b.
FRATERNITY
has
the
right to terminate this License Agreement upon thirty (30) days written notice
to the LICENSEE
specifying
the details of the grounds for termination and advising that unless the
LICENSEE
immediately
proceeds to cure and does cure the default(s) within said thirty (30) days,
the
License Agreement can be terminated in any of the following
situations:
(1) | Delinquency in payment of any sums owing to FRATERNITY; |
(2) |
Inability
to conduct the licensed business such as through insolvency, attachment
of
assets, liquidation, receivership or some other order of a court,
administrative agency or other governmental official or
body;
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(3) |
Misuses
or unauthorized use of the Insignia of
FRATERNITY or
any other conduct which in the judgment of FRATERNITY
is
detrimental to the goodwill of FRATERNITY
or
otherwise injurious to the best interest of FRATERNITY
licensing
program;
|
(4) |
Failure
to comply with any other obligation imposed on the LICENSEE
by
or through this License Agreement.
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12. OBLIGATIONS
UPON
TERMINATION: The continuing obligations of the LICENSEE
after
termination or expiration of this License Agreement are as follows:
a. | To pay any sums then or subsequently owing to FRATERNITY, |
b. |
To
cease any production, use, marketing or distribution of any merchandise
bearing the Insignia of FRATERNITY
and
LICENSEE
shall
cease holding itself out as being a LICENSEE
of,
or otherwise affiliated with, FRATERNITY
and
the LICENSEE
shall
not advertise or otherwise publicize the former affiliation with
FRATERNITY;
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c. |
FRATERNITY,
in
its sole discretion, has the option to purchase from LICENSEE
any
portion of the supplies or materials remaining on hand containing
any of
the Insignia of FRATERNITY
which
items shall be provided to
FRATERNITY
at
cost; and
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d. |
LICENSEE
shall
destroy any other items on hand bearing FRATERNITY
Insignia
or otherwise remove such Insignia from any merchandise, equipment,
fixtures and structures as to any items remaining on hand bearing
the Insignia of FRATERNITY
which FRATERNITY
does
not wish to purchase pursuant to subsection
above.
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13. NO
WAIVER: The failure of
either party to exercise any power or right under this License Agreement
or
to
insist at any time upon the strict compliance with any of the provisions hereof
shall not constitute a waiver
of
said party's right to thereafter demand exact compliance with the terms hereof.
A waiver shall
only be
effective if it is contained in a writing signed by the party against whom
the
waiver is claimed
and
shall
not preclude that party from declaring default as to any further continuation
or
occurrence of
that or
any other grounds to declare default of this License Agreement.
14. NO
AGENCY: LICENSEE
acknowledges
that this License Agreement does not in any way establish LICENSEE
as
an
agent or employee of FRATERNITY.
LICENSEE acknowledges
that it is entering into this agreement
solely to become a LICENSEE
of FRATERNITY
with
no
right or authority to assume or create any
obligation on behalf of FRATERNITY.
15. INDEMNIFICATION:
Should
FRATERNITY
receive
any claim or otherwise incur any liability relating to any loss as a result
of
any claim relating to any alleged actions or omissions of LICENSEE
, FRATERNITY shall
be
indemnified and held harmless by the LICENSEE
from
any
such claim or loss including any costs and reasonable attorneys' fees incurred
by FRATERNITY
to
defend
against same. FRATERNITY
shall
have the right to participate in the settlement of any such claims.
16. INVALIDITY
OF TERMS: Any
provision of this Agreement prohibited by law shall be ineffective to the extent
of such prohibition without invalidating the remaining provisions of this
Agreement.
4
17. NOTICES:
Any notices
required to be given pursuant to this License Agreement should be addressed
as
follows:
LICENSOR:
Associate
Executive Director - Administration and Finance
Sigma
Alpha Epsilon Fraternity
X.X.
Xxx
0000
Xxxxxxxx,
Xxxxxxxx 00000
F
rank X.
Xxxxxxxxx
000
Xxxxxx Xxxx
Xxxxxx,
XX 00000-0000
LICENSEE:
Designer
Sports Apparel, Inc.
000
X.
Xxxxxx Xxxxxx Xxxx X
Xxxxxxxxx,
XX 00000
18.
BREACH OF CONTRACT: Should
LICENSEE
materially breach any provision of this License Agreement,
it shall be required to pay any reasonable attorney’s fees, as well as any
litigation or other expenses
resulting there from incurred by FRATERNITY.
19.
BINDING EFFECT: This License Agreement is not assignable by either party and
shall be binding upon any employees, agents, heirs, executors, administrators,
assigns, or successor in interest of any of the parties.
20.
ENTIRE AGREEMENT: This License Agreement contains the entire understanding
and
agreement between the parties, and any statements, promises, or inducements
made
by either party, or agent of either party, that is not contained in this License
Agreement shall not by valid or binding, nor may this License Agreement be
enlarge, modified, or altered, except in writing signed by the parties.
21.
CHOICE OF LAW: This License Agreement shall be interpreted and applied according
to the laws of the State of Illinois.
IN
WITNESS WHEREOF, the parties have executed this License Agreement this day
and
year first above written.
FRATERNITY: | LICENSEE: |
Sigma Alpha Epsilon Fraternity | Designer Sports Apparel, Inc. |
By: /s/
Xxxxxxxxx X Xxxxxx
|
By:
/s/
Xxxxx X. Xxxxxx
|
Signature | Signature |
Xxxxxxxxx X Xxxxxx, Associate Executive Director | Xxxxx X Xxxxxx, President |
Print name and title | Print name and title |
5
Agreement
No. A16530
Appendix
A
General
Product description: Screen
printed t-shirts
Product Number | Product Description | Price |
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
|
Please
use additional pages if needed.
6
7
8
9
10
11
00
Xxxxxxxx
X
Xxxxxxxxx
Xx. XX0000
13
Appendix C
Affinity
Marketing Consultants, Inc.
CLIENT
PRODUCTS AND SERVICES POLICY
Products
and services containing images of Greek organizations help to define the public
perception of each individual
Greek organization. Since the Greek organizations aligned with Affinity
Marketing Consultants, Inc.
are
proud of values that help define their intellectual property, they wish to
protect their marks and control the
manner
in which their marks are used by product manufacturers and service providers.
All vendors are required to abide by the following quality control
rules:
The
following rules will apply to any licensed product or service utilizing Greek
marks, specifically but
not
limited to the following categories of products:
*apparel (shirts, shorts, jackets, etc.) | *press releases |
*flyers | *banners |
*manuals | *glassware |
*publications | *party favors (cups, frames, key chains, etc.) |
*posters | *computer web pages |
*newspaper articles & advertisements |
There
may
not be:
any
depiction of alcohol, alcoholic beverage use, kegs, beer cans, alcohol
bottles,
beer
bongs, or brand names;
any
depiction of drugs, drug use, drug slogans or slang words, or drug
paraphernalia;
any
depiction in a demeaning way, of minorities, ethnicities, or cultural segments;
any
religious depictions in a demeaning way;
any
depictions of men or women in a demeaning way;
any
depictions relating to sex, sexual paraphernalia, or sexual
orientation;
any use
of profanity;
or
any
use of licensed or copyrighted characters, phrases, logos, or materials without
permission
from the
property owner.
Approval
for all products and services will be coordinated by Affinity Marketing
Consultants and granted in compliance with the license agreement prior to
production of said product or service.
If
you
are unsure about an image or slogan, contact Xxxxxxx Xxxx-Xxxxxxxx for
approval.
*
Developed from Sigma Alpha Mu Fraternity's Public Relations
Policy,