Disposal of Seconds and Close-Outs Clause Samples

The "Disposal of Seconds and Close-Outs" clause governs how goods that are classified as seconds (items with minor defects) or close-outs (end-of-line or discontinued products) are handled in a commercial agreement. Typically, this clause outlines the procedures for selling, discounting, or otherwise disposing of such inventory, and may specify whether the seller or buyer is responsible for these goods. By clearly defining the process for managing non-standard or surplus items, the clause helps prevent disputes over unsold or imperfect stock and ensures both parties understand their rights and obligations regarding these products.
Disposal of Seconds and Close-Outs. Seconds and Close-Outs sold by the Licensee may be sold only to Approved Accounts and Approved Seconds and Close-Outs Accounts, including those customers identified on Schedule 6.14. Whenever the Licensee shall wish to sell Seconds and Close-Outs to customers not previously approved by CKI, the Licensee shall submit to CKI a written list of the proposed customers for Seconds and Close-Outs for CKI's prior written approval. The proposed customers approved from such list, together with the customers listed on Schedule 6.14, are referred to as the "Approved Seconds and Close-Outs Accounts." Notwithstanding CKI's approval of any customer, CKI may at any time subject sales to any such customer, including, without limitation, any such customer listed on Schedule 6.14, to any conditions or limitations CKI considers appropriate; provided, however, that in order to be effective, any such conditions or limitations must be set forth in a writing provided to the Licensee. Nothing herein shall be deemed to prohibit CKI from withdrawing its approval of any Approved Seconds and Close-Outs Account for "good" bona fide reasons, including, without limitation, any such Approved Seconds and Close-Outs Account listed on Schedule 6.14, upon written notice to the Licensee (at which time, such customer shall cease to be an Approved Seconds and Close-Outs Account for purposes of this Agreement); provided, however, that the Licensee may fulfill any firm orders entered into prior to the Licensee's receipt of CKI's withdrawal of approval.
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Disposal of Seconds and Close-Outs. A. Licensee shall use reasonable efforts to dispose of Licensed Products which are designated as Seconds in a way which shall maintain the value of the Licensor's Trademark and Licensor's reputation, and Licensee shall obtain Licensor's Approval with respect to the terms and method of such disposal. All Seconds approved for sale by Licensor shall clearly be marked "Seconds" or "Irregular" in a manner obvious to a casual consumer. The percentage of Seconds of any of the Licensed Products which shall be disposed of pursuant to this Section shall not exceed five percent (5%) of the total number of Units of Licensed Products distributed, manufactured or sold by Licensee in each Annual Period. B. All Close Outs shall be sold only with Licensor's Approval, through retail outlets and traditional accepted dealers in such merchandise and upon such terms and conditions as Licensee determines appropriate. The percentage of Close Outs sold pursuant to this Section shall not exceed fifteen percent (15%) of the total number of Units of Licensed Products distributed, manufactured or sold by Licensee in each Annual Period.
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Disposal of Seconds and Close-Outs. Seconds and Close-Outs sold by the Licensee may be sold only to Approved Accounts and Approved Seconds and Close-Outs Accounts, including those customers identified on Schedule 6.14. Whenever the Licensee shall wish to sell Seconds and Close-Outs to customers not previously approved by CKI, the Licensee shall submit to CKI a written list of the proposed customers for Seconds and Close-Outs for CKI’s prior written approval. The proposed customers approved from such list, together with the customers listed on Schedule 6.14, are referred to as the ‘‘Approved Seconds and
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Disposal of Seconds and Close-Outs 
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