THIRD SUPPLEMENTAL AGREEMENT
AGREEMENT made this 30th day of June, 1998 by and between Equilink Licensing
Corporation, a Delaware corporation, c/▇ ▇▇▇▇▇▇▇ Sports, Inc., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("Licensor") and Kmart Corporation, a
Michigan corporation, ▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
("Licensee").
WHEREAS, Licensor and Licensee entered into an Agreement dated January 23,
1989 ("Parent Agreement") with respect to the trademark "MacGregor", said Parent
Agreement being amended and supplemented by that First Supplemental Agreement,
Second Supplemental Agreement and Third Supplemental Agreement dated November
15, 1989, August 30, 1990 and June 30, 1994, respectively; and
WHEREAS, Licensor and Licensee have agreed to further amend and supplement the
Parent Agreement effective July 1, 1998 to amend the provisions governing the
categories of licensed goods, royalties and minimum guarantees on the terms and
conditions set forth as follows:
NOW THEREFORE, for good and valuable consideration heretofore
acknowledged the parties agree as follows:
1. This amendment shall be effective July 1, 1998 (the "Effective Date").
2. Commencing on the Effective Date, Section 1 of the Parent Agreement (as
amended by the Third Supplemental Agreement) is further amended
to provide as follows:
"1. Term. This Agreement shall commence January 1, 1992 and
shall be in full force in effect until June 30, 2001 as
long as the following conditions occur or are
maintained."
3. Commencing on the Effective Date, Sections 2 and 3 of the Parent
Agreement are amended to provide in full as follows:
"2. The Exclusive Grant: Intentionally omitted."
"3. The Non-Exclusive Grant: Licensor hereby grants
Licensee a license to use the MacGregor trademark
in connection with the manufacture,
advertisement, promotion and sale of athletic and
sweat socks in the Territory and only in the
distribution channels set forth in Section 10
hereof. Licensor agrees that it shall not grant
any other person a license to use the MacGregor
trademark in connection with the manufacture,
advertisement, promotion and sale of athletic or
sweat socks in the Territory in any national
discount retail store that carries apparel and
non apparel, including Wal-mart and Target
Stores."
4. Commencing on the Effective Date, Section 6(a) of the Parent Agreement
is amended to provide in full as follows:
"a. Subject to the yearly minimum royalties set forth in paragraph
7, there shall be due and owing and Licensee shall pay to Licensor
in the manner provided in paragraph 8, a royalty equal to 2.0% of
the cost of licensed goods, as such term is defined in paragraph
6(b) below."
5. Commencing on the Effective Date, Section 7 of the Parent Agreement is
amended to provide in full as follows:
"7. Annual Minimum Royalties. Licensee shall pay in the manner
provided in paragraph 8, $200,000 to licensor as a minimum annual
guarantee. These minimum payments are required on an annual basis,
and Licensee is not entitled to any credit for royalties or
payment in different years. However, Licensee is entitled to a
credit applicable to other quarters within the same year."
6. Commencing on the Effective Date, Section 10 of the Parent Agreement is
amended to provide in full as follows:
"10. Limitation on Distribution. Licensee may sell licensed goods
only in either or both the apparel department and sporting goods
department of Kmart Corporation stores and only in the Unites
States. Licensee shall grant no sublicense regarding the MacGregor
trademark, provided that Licensee shall be allowed to purchase and
market products licensed hereunder through its wholly-owned
subsidiary, Kmart Apparel Corp."
7. Commencing on the Effective Date, Section 11(b) of the Parent Agreement
is amended to provide in full as follows:
"b. Suspension and Termination Option. Intentionally omitted."
8. It is hereby acknowledged that the First Supplement Amendment and
Second Supplemental Amendment both have heretofore been terminated
by mutual agreement of the parties and are of no further force or
effect.
9. Commencing on the Effective Date, except as modified herein, the Parent
Agreement, as amended, survives this Fourth Supplemental Agreement and
remains in full force and effect in accordance with its terms.
KMART CORPORATION EQUILINK LICENSING CORPORATION
By: /s/ By: /s/
Its: Its: Chief Executive Officer