Endorsement Agreement Between Apparel Company and Licensor of Professional
Athlete (Replacing Agreement with former Licensor)
This agreement (the Agreement ) is made as of ____________________ (date) by and
between _____________________________ (Athletic Apparel Company) , a corporation
organized and existing under the laws of the state of __________________ (name of state) ,
with its principal office located at __________________________________________________
______________________________ (street address, city, county, state, zip code) , referred
to herein as Company , ____________________ (Name of Licensor) , and ________________
(Name of Athlete) of ___________________________________________________________
________________ (street address, city, county, state, zip code) , hereinafter called Athlete .
Whereas, Athlete is a well-known professional athlete whose endorsement has
commercial value; and
Whereas, Company and ____________________ (name of former Licensor) entered
into an Endorsement Agreement dated as of ___________________ (date) , which Agreement
will expire on _________________ (date) hereinafter called the Former Agreement ; and
Whereas, Company desires to continue to obtain the exclusive rights to use the name,
fame, image and athletic renown of Athlete in connection with the advertisement and promotion
of certain of its Products following the expiration of the Former Agreement on _____________
(date) ; and
Whereas, Athlete has licensed all such rights to Licensor , along with the right to
sublicense such rights to third parties.
Now, therefore, for and in consideration of the mutual covenants contained in this
agreement, and other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties agree as follows:
1. Definitions
As used in this Agreement, the following terms shall be defined as follows:
A. Contract Period shall mean that period of time commencing on ______________
(date) and concluding ________________ (date) , unless terminated sooner as provided
in this Agreement.
B. Contract Territory shall mean worldwide.
C. Contract Year shall mean the consecutive 12-month period beginning on any
________________ (date) during the Contract Period .
D. Gross Sales shall mean total revenues, under generally accepted accounting
principles, from Sales of the Licensed Products, but does not include any revenue from
Sales , use or other transaction taxes, duties, handling, graphics, embroidery or shipping.
E. Net Sales shall mean Gross Sales less Product returns, trade discounts,
samples, allowances, value added services, markdowns, customer charge-backs and
liquidation Sales (substantially discounted and out of ordinary distribution channel) of
Licensed Products.
F. Licensed Products shall mean ________________________________________
(names of Product lines) or other similarly named Product lines using the name of
Athlete Identification on the Products ' affixed labels, hang-tags or logos.
G. Product shall mean men and/or women’s apparel, including _________________
______________________________________________________ (types of apparel) .
H. ____________________ (Name of Athlete) means the right to use, subject to
the provisions of this Agreement, Athlete ’ s name, fame, nickname, initials, autograph,
voice, video or film portrayals, facsimile signature, photograph, likeness and image or
facsimile image, and any other means of endorsement by Athlete used in connection
with the advertisement and promotion of the Company and the Products (including the
Licensed Products).
2. Grant of Rights
In consideration of the remuneration to be paid to Licensor pursuant to this Agreement,
Licensor grants to Company and to its authorized distributors and sub-licensees the right and
license during the Contract Period to use the ____________________ (Name of Athlete) solely
in connection with the advertisement, marketing and promotion of the Products within the
Contract Territory as set forth in this Agreement. Licensor agrees not to grant the right to use
the _____________________ (Name of Athlete) to anyone other than Company in connection
with the advertisement and promotion of Products . It is understood that Company , its
authorized distributors and sub-licensees may not use the _____________________ (Name of
Athlete) in connection with any items for sale or resale, other than the Products as specified in
this Agreement. The foregoing rights to use the _______________________ (Name of
Athlete) is limited to television, radio and print advertising, advertising published over the
Internet (provided such material is limited to advertising or Product promotion only), public
relations and marketing materials, point-of-sale displays, free standing inserts, videos shown to
customers and consumers, catalogs for customers and consumers, direct mail (including e-mail)
and billboards. Company shall ensure that all uses of ___________________ (Name of
Athlete) comply with applicable law.
3. Prior Approval
Company agrees that neither use of the (Name of Athlete) nor any item used in
connection with the ________________________ (Name of Athlete) (including any Licensed
Product ) will be made under this Agreement unless and until the same is approved by
Licensor . Licensor agrees that any material, advertising or otherwise, submitted for approval
as provided in this section may be deemed by Company to have been approved under this
section if the same is not disapproved in writing within _______ (number) business days after
receipt of the material. Licensor agrees that it will reasonably cooperate with Company and
that any material submitted under this section will not be unreasonably disapproved and, if it is
disapproved, that Company will be advised of the specific grounds for disapproval. If Company
desires immediate approval of advertising material, Company shall have the right to directly
contact Licensor's authorized agent to obtain such approval. Company agrees to protect,
indemnify and hold harmless Licensor , Athlete and their authorized agents, or any of them,
from and against any and all expenses, damages, claims, suits, actions, judgments and costs
whatsoever, arising out of, or in any way connected with any advertising material furnished by,
or an behalf of Company , except with respect to any inaccurate information furnished by them
expressly for use in such advertising.
4. Remuneration
In consideration of the endorsement rights granted under this Agreement, Company
shall pay to Licensor the annual fees (the Annual Fee ) in the Contract Years in accordance
with the Schedule attached hereto as Schedule A . One-half of the Annual Fee will be due on or
before _______________ (date) and ________________ (date) of each Contract Year.
5. Bonuses
It is agreed that should Athlete achieve any of the accomplishments set forth in
Schedule B attached hereto during the Contract Period , then Company will provide Licensor
the additional remuneration set forth therein for each such accomplishment due to the increased
value in the ________________________ (Name of Athlete) . Bonus payments under this
Section Five will be due within ________ (number) days following the achievement of each of
the accomplishments set forth above pursuant to the terms set forth in Section Eight below.
6. Royalty on Licensed Products
A. Calculation of Royalty Fees.
In addition to the payments provided in Sections 4 and Section 5 , Company will
pay to Licensor in U.S. dollars a fee ( Royalty Fee ) of _____% of the Net Sales of
Licensed Products sold by Company directly or through its distributors or sub-licensees
during the Contract Term.
B. Payment of Royalty Fee.
Company will account for and pay the Royalty Fee to Licensor within _______
(number) days following the end of each fiscal quarter during the Contract Period .
Amounts not paid when due will accrue interest from the date due until paid at the rate of
______% per month or the maximum interest permitted by applicable laws, whichever is
less.
C. Royalty Report.
Company will deliver to Licensor , at the time each Royalty Fee payment is due,
an itemized statement ( Royalty Report ):
1. Indicating the total amount of Net Sales of all Licensed Products shipped
during the previous fiscal quarter, and
2. Showing the number of Licensed Products sold by category of Product .
Company will furnish the required Royalty Report to Licensor whether or not
any Licensed Products have been sold during the relevant fiscal quarter. The
receipt or acceptance by Licensor of any Royalty Report or of any payments
made under this Agreement will not preclude Licensor from questioning their
correctness at any time. Licensor reserves the right to audit the calculation of
Net Sales provided in the Royalty Report, and Company will cooperate with the
Licensor in any such audit request.
D. Currency.
Whenever it becomes necessary under this Section 6 to convert a monetary
amount from a foreign currency to U.S. dollars (whether for reporting,
statements, or other purposes), such conversion will be made at the average of
the currency exchange rates during the applicable reporting period, as derived
using the ___________________ (name of conversion tool) currently posted at
__________________________ (website address for conversion tool) (the
Conversion Tool ). A conversion for the purpose of calculating a royalty payment
pursuant to this Section 6 will be weighted according to the relative amount of
Net Sales within each fiscal quarter. If the Conversion Tool is discontinued or
otherwise no longer available, the parties will use such other index or
computation that replaces the Conversion Tool or otherwise will result in
substantially the same conversion rate as would be obtained by using the
Conversion Tool.
E. Marketing Commitment.
Company agrees that it will continue in good faith to produce and market
Licensed Products in the same manner that it is currently producing and marketing such
items as of ___________________ (recent benchmark date) unless Company and
Athlete believe it is not commercially reasonable to continue to produce and market the
Licensed Products.
7. Services of Licensor
A. If Company desires to use the services of Athlete as a model in connection with
Company advertising to promote its Products or as a part of a special promotional
appearance for the Company , Licensor agrees, at the request of Company , to provide
the services of Athlete for ______ (number) days per Contract Year as mutually agreed
upon and at places reasonably convenient to his schedule. Each day shall not exceed
_______ (number) hours unless otherwise agreed upon. Company agrees that it will
reimburse Licensor for all reasonable travel, lodging and meal expenses incurred by
Licensor or Athlete in connection with such services. Licensor agrees to use its best
efforts to cause _______ (number) to make appearances at Company 's booth at
_______________________ (name of trade show) in __________________ (name of
city) , __________________ (name of state) each Contract Year during the Contract
Period . If Athlete is unable to attend ______________________ (name of trade show)
in any Contract Year , Licensor agrees that it will provide Athlete ’ s services for
________ ( number) minutes in such Contract Year at a mutually agreed upon time and
location. If Athlete retires from competitive __________________ (name of sport)
during the Contract Period , Licensor agrees that Athlete will provide Company with an
additional service day per Contract Year starting in the Contract Year Athlete retires
from competitive playing. Company further understands that failure to use services of
Athlete pursuant to this Section shall not result in any reduction in payments to
Licensor under this Agreement nor may the obligation to provide services be carried
forward or backward to any Contract Year. The obligations of Licensor to provide
services of Athlete under this Agreement are subject to the condition that payments to
Licensor are current and up to date.
B. Should Company use ____________________ (Name of Athlete) in television
advertising to promote Company's Products, Company will make all applicable
required union scale and pension and welfare payments.
C. During the Contract Period , Athlete shall wear Company Products at all
professional __________________ (name of sport) events and at all media
appearances where appropriate. It is agreed that the logo or name of Company (the
Company Logo ) shall be affixed to the ______________________________________
( description of location on body) locations of all Company Products that Athlete
wears, when he plays professional _________________ (name of sport) . Company
agrees that it will be responsible for, and the cost of, affixing the Company Logo on all
such Company Products . Company acknowledges that other locations on Athlete ’ s
Products are reserved for Licensor 's other sponsors. Furthermore, Company
understands that if _______________________ ( Athlete’s Name) participates in a
special team event where there is an official uniform, then Athlete is permitted to wear
such uniform during such event (e.g., (examples of special events ) ________________
_____________________________________________________________________ .
D. During each Contract Year, Company shall supply Athlete with sufficient
quantities of Company 's Products (at least _______ [number of pieces] pieces of
________________ [name of sport] apparel) which are entirely suitable for Athlete use
in professional competition so he can wear such apparel while he plays professional
________________ (name of sport) . Company agrees to pay all charges in connection
with the delivery of Products to Athlete , including shipping charges, air-freight charges
and customs charges. Company agrees to reimburse Athlete 's authorized agent for all
such reasonable expenses incurred by it in connection with the transfer of Products and
clothing to Athlete .
E. On a semi-annual basis, Athlete shall provide to Company colors and styling
suggestions for the Licensed Products that Company wishes to produce. Before each
season is finalized, Company will provide Licensor with the right to review the design
materials for the upcoming season, including color images and fabric samples. The
Company will, in good faith, consider any suggestions by Athlete before finalizing the
Product line, with such review and consideration to constitute Licensor's approval as
contemplated in this Agreement.
8. Payments
All payments shall be made by wire transfer drawn to the account of Licensor as set
forth in Schedule C attached hereto. Past due payments under this Agreement shall bear
interest at the rate of:
A. ______ % per month; or
B. The maximum interest rate permissible under law, whichever is less. All amounts
in this section are in United States dollars.
9. Authorized Agent
Licensor designates ______________________ (Name of Athlete’s)
______________________ (name of agent) , of _____________________________________
________________________________ (street address, city, county, state, zip code) , as his
authorized agent for all purposes under this Agreement. All notices or submissions to be made
or delivered by Company to Licensor pursuant to this Agreement shall be delivered to the
agent's above address free of all charges such as, for example, shipping charges and customs
charges. If any such charges are paid by Licensor or by its authorized agent, Company agrees
to make prompt reimbursement. All notices or submissions to be made or delivered to
Company pursuant to this Agreement shall be delivered to C ompany , at __________________
_____________________________________ (street address, city, county, state, zip code) ,
Attention: ____________________________ (name or title of contact person at Company) .
10. Default
A. If either party at any time during the Contract Period shall:
1. Fail to make any payment of any sum of money specified in this
Agreement to be made; or
2. Fail to observe or perform any of the covenants, agreements or
obligations under this Agreement (other than the payment of money), the non-
defaulting party may terminate this Agreement as follows: as to a default under
Clause 1 above, if such payment is not made within ______ (number) business
days after the defaulting party shall have received written notice of such failure to
make payment; or, as to a default under Clause 2 above, if such other default is
not cured within ________ (number) days after the defaulting party shall have
received written notice specifying in reasonable detail the nature of such default.
In order to be a sufficient notice under this Section, any such written notice shall
specify in detail each item of default and shall specify the provision of this
Agreement which applies to each item of default, and shall specify in detail the
action the defaulting party is required to take in order to cure each item of default.
The termination rights set forth in this section shall not constitute the exclusive
remedy of the non-defaulting party under this Agreement, however, and if default
is made by either party under this Agreement, the other party may resort to such
other remedies as such party would have been entitled to if this section had been
omitted from this Agreement, subject to the terms of this Agreement. Termination
under the provisions of this section shall be without prejudice to any rights or
claims which the terminating party may otherwise have against the defaulting
party, and if Company is the defaulting party, Company shall be responsible for
any and all payments due under the terms of this Agreement in addition to other
liabilities set forth above.
B. If Company shall become bankrupt or insolvent, or if Company's business shall
be placed in the hands of a receiver, assignee or trustee, whether by voluntary act of
Company or otherwise, the Contract Period , at the election of Licensor , shall
immediately terminate.
11. Use of ______________________ (Name of Athlete) Identification after Termination
A. Except as provided in Paragraph B of this Section 11 , from and after the
termination of the Contract Period , all of the rights of Company to the use of the
____________________ ( Athlete’s Name) shall cease absolutely and Company subsequently
shall not use or refer to the _______________________ ( Athlete’s Name) in advertising or
promotion in any manner whatsoever. Except as provided in Paragraph B below, it is further
agreed that following termination of the Contract Period , Company shall not advertise, promote,
distribute or sell any item whatsoever in connection with the use of any name, figure, design,
logo, trademark or trade name similar to or suggestive of the ___________________ ( Athlete’s
Name) .
B. Liquidation of Inventory
1. Company may liquidate and sell its inventory of Licensed Products
(including any inventory then in Product ion) for a period of ______ (number)
days after the termination date of the Contract Period , subject to the Company's
continued obligation to pay the Royalty Fee as provided in Section 6 above, and
will deliver the Royalty Report with respect to such liquidation sales within
______ (number) days following the end of such _______ [number of days] -
day period.
2. If Company has not disposed of all Licensed Products as provided in
Subparagraph B-1 above by the end of the ______ (number) -day period,
Company , at its option, may either:
a. Remove or obliterate entirely from such Licensed Products (and
any labels, tags, riders and the like) all references to any ___________________
( Athlete’s Name) , and then sell the same; or
b. Destroy all such remaining Licensed Products.
12. Trademarks
Company agrees that it will not file, during the Contract Period or afterward, any
application for trademark registration or otherwise obtain or attempt to obtain ownership of any
trademark or trade name within the Contract Territory or in any other country of the world which
consists of the ____________________ (Athlete’s Name) or any mark, design or logo intended
to obtain any rights to ____________________ [name of athlete] Identification or to identify
Products as being endorsed by Athlete ________________________ [name of athlete] . If,
prior to commencement of the Contract Period , Company has filed one or more applications for
registration of any such trademark, or otherwise has obtained any rights to such trademark,
Company agrees to cause such applications and trademarks to be assigned and transferred to
Licensor as soon as possible.
13. Reservation of Rights
All rights not specifically granted in this Agreement to Company shall remain the
property of Licensor to be used in any manner Licensor deems appropriate. Company
understands that Licensor bas reserved the right to authorize others to use the
________________________ (Athlete’s Name) within the Contract Territory and during the
Contract Period in connection with all tangible and intangible items and services other than
Products themselves. Licensor is not aware of any such rights that would conflict with the
nature or image of Company Products .
14. Indemnity
Company agrees to protect, indemnify and hold harmless Licensor ,
_________________________ (Athlete’s Name) and their authorized agents, or any of them,
from and against any and all expenses, damages, claims, suits, actions, judgments and costs
whatsoever, including reasonable attorney's fees, arising out of, or in any way connected with,
actions or omissions of Company , any advertising material furnished by, or an behalf of,
Company , or any claim or action for personal injury, death or other cause of action involving
alleged defects in Company 's Products or services. Company agrees to provide and maintain,
at its own expense, general commercial and product liability insurance with limits no less then
$_____________ and naming Licensor and Athlete as additional named insureds. Within
______ (number) days after the date of this Agreement, Company will submit to Licensor
evidence of such policy, requiring that the insurer shall not terminate or materially modify such
policy without written notice to Licensor at least _____ (number) days in advance of such
termination or modification.
15. Right of Termination
Company shall have the right to terminate this Agreement, upon written notice to
Licensor , if the commercial value of the ______________________ ( Athlete’s Name) is
substantially reduced because Athlete :
A. Has been charged with illegal or immoral conduct which could result in a felony
conviction and such charges have not been dismissed or terminated within _______
[number of days] days; or
B. Fails an officially sanctioned drug test or is criminally convicted of any felony or
drug related offense. Any termination pursuant to this Section shall become effective on
the _______ (number) day next following the date of receipt by Licensor of
Company's written notice to so terminate.
16. Contract Extension
Due to long Product development lead times, Company and Licensor agree to begin
discussions for the renewal of this Agreement by _______________ (date) . All terms of the
_____________ (identification of year) Agreement will remain in effect until its expiration on
________________ (expiration date of Former License agreement) . The terms of this
Agreement will automatically commence on ________________ (date) and expire on
_________________ (date) . ..
17. Limited Liability
Notwithstanding anything to the contrary in this Agreement, if Company incurs any
expenses, damages or other liabilities (including, but not limited to, reasonable attorney's fees)
in connection with the performance or nonperformance of any term or provision of this
Agreement, Licensor 's liability to Company shall not exceed the remuneration, excluding
reimbursement of expenses, actually paid to Licensor by Company . In no event will Licensor
be liable for any indirect, incidental, reliance, special or consequential damages arising out of
the performance or nonperformance of this Agreement, whether or not Licensor had been
advised of the possibility of such damages. It is understood that Athlete is not a party to this
Agreement and has no liability under this Agreement but is an intended specific third-party
creditor beneficiary of this Agreement.
18. Severability
If any provision of this Agreement shall be declared illegal, invalid, void or unenforceable
by any judicial or administrative authority, the validity of any other provision and of the entire
Agreement shall not be affected by such declaration.
19. No Joint Venture
This Agreement does not constitute and shall not be construed as constituting an
association, partnership, joint venture or relationship of principal and agent, or employer and
employee, between Licensor and Company . Neither party shall have any right to obligate or
bind the other party in any manner whatsoever, and, except as expressly set forth in this
Agreement, nothing contained in this Agreement shall give, or is intended to give, any rights of
any kind to any person.
20. No Waiver
The failure of either party to this Agreement to insist upon the performance of any of the
terms and conditions of this Agreement, or the waiver of any breach of any of the terms and
conditions of this Agreement, shall not be construed as subsequently waiving any such terms
and conditions, but the same shall continue and remain in full force and effect as if no such
forbearance or waiver had occurred.
21. Governing Law
This Agreement shall be governed by, construed, and enforced in accordance with the
laws of the State of ______________.
22. Notices
Any notice provided for or concerning this Agreement shall be in writing and shall be
deemed sufficiently given when sent by certified or registered mail if sent to the respective
address of each party as set forth at the beginning of this Agreement.
23. Attorney’s Fees
In the event that any lawsuit is filed in relation to this Agreement, the unsuccessful party
in the action shall pay to the successful party, in addition to all the sums that either party may be
called on to pay, a reasonable sum for the successful party's attorney fees.
24. Mandatory Arbitration
Any dispute under this Agreement shall be required to be resolved by binding arbitration
of the parties hereto. If the parties cannot agree on an arbitrator, each party shall select one
arbitrator and both arbitrators shall then select a third. The third arbitrator so selected shall
arbitrate said dispute. The arbitration shall be governed by the rules of the American Arbitration
Association then in force and effect.
25. Entire Agreement
This Agreement shall constitute the entire agreement between the parties and any prior
understanding or representation of any kind preceding the date of this Agreement shall not be
binding upon either party except to the extent incorporated in this Agreement.
26. Modification of Agreement
Any modification of this Agreement or additional obligation assumed by either party in
connection with this Agreement shall be binding only if placed in writing and signed by each
party or an authorized representative of each party.
27. Assignment of Rights
The rights of each party under this Agreement are personal to that party and may not be
assigned or transferred to any other person, firm, corporation, or other entity without the prior,
express, and written consent of the other party.
In this contract, any reference to a party includes that party's heirs, executors,
administrators, successors and assigns, singular includes plural and masculine includes
feminine.
WITNESS our signatures as of the day and date first above stated.
_____________________________________
(Name of Athletic Apparel Company )
________________________ _____________________________________
(P rinted name) (P rinted name & Office In Corporation)
________________________
(Signature of Athlete)
By:_________________________________
(P rinted name & Office in Corporation)
__________________________
(Signature of Officer)
