Document:

Exhibit 10.2

 

FANTEX, INC.

 

February 28, 2013

 

Mr. Arian Foster

c/o Life Line Financial Group

8447 Wilshire Blvd, Suite 450

Beverly Hills, CA 90211

Attention: Mr. Humble Lukanga

 

Re:  Brand Agreement

 

Dear Mr. Foster:

 

This letter agreement (“Letter Agreement”) and attached exhibits are being provided to you in response to your interest in entering into a Brand Agreement with Fantex, Inc. (“Fantex”), in connection with a potential securities offering by Fantex linked to the value of the Brand Amount as set forth in greater detail in this letter and each of the Exhibits, schedules and related documents referenced herein (all of which, together, constitutes the complete “Agreement”) between you and Ugly Duck, LLC (together, jointly and severally, as “Participant”) and Fantex.  Sometimes each of Participant and Fantex are referred to herein as a “Party” and together as the “Parties.”

 

Please review the enclosed materials carefully, including the terms and conditions of this Letter Agreement and each of the following Exhibits.  If you agree with the terms and conditions outlined in each of the attached documents, then please complete and execute (where indicated) this letter and a copy of each of the following applicable documents, and forward the entire set of completed and executed documents to Fantex for our review:

 

o            Exhibit A:  Participant Questionnaire

o            Exhibit B:  Definitions and Examples of “Field” and “Brand Income”

o            Exhibit C:  Brand Agreement - Standard Terms and Conditions

o            Exhibit D:  Closing Certificate

o            Exhibit E:  Quarterly Report

o            Exhibit F:  Spousal Consent

o            Exhibit G:  Form of Irrevocable Payment Instructions

 

IT IS IMPORTANT FOR YOU TO ENSURE THE ACCURACY AND COMPLETENESS OF ALL INFORMATION PROVIDED TO FANTEX ON THE FORMS REFERENCED HEREIN, WHICH WILL BE RELIED UPON BY FANTEX IN CONNECTION WITH THE POTENTIAL SECURITIES OFFERING AND OTHER MATTERS UNDER THIS AGREEMENT.

 

Also, it is important to remember that Fantex is not, and will not at any time be, an agent, representative or advisor to Participant.  We encourage you to secure personal counsel to advise you with respect to legal, tax, accounting and other issues as you and your advisors deem advisable in connection with the attached materials and potential transaction. By participating in the transactions contemplated herein, Participant is deemed to represent that it has obtained advice from its advisors regarding the consequences of being a Participant, and Participant is not relying on any representations or warranties regarding the tax consequences to Participant of the transactions contemplated hereby.

 

For purposes of this Agreement, “Participant” shall refer to Arian Foster (“Talent”) and/or Ugly Duck, LLC (“Company”), jointly and severally, as the context may require.  Talent represents, warrants and

 

 

covenants, as applicable, that he is, and throughout the Term shall remain, the sole owner and have complete control of the Company (other than in the case of death or incapacity of Talent), through which a portion of the Brand Income may be received; and Company represents and warrants that it is duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation or organization and all other jurisdictions in which its ownership of property or conduct of business requires it to be qualified.

 

Upon execution of this letter where indicated below by each of Fantex and Talent and Company (together as Participant), the Parties hereby agree to the following terms and conditions as of the last date of execution (“Execution Date”) by all Parties:

 

1.                                      Purchase Price.  Upon the terms and subject to the conditions of this Agreement, as full, final and complete consideration for the right to receive the Brand Amount during the Term of this Agreement, Fantex shall pay Participant an amount equal to $10,000,000 (the “Purchase Price”), less an amount equal to 5% of the Purchase Price (the “Escrow Holdback”).  The Escrow Holdback shall be deposited into an escrow account at Wells Fargo Bank, N.A. (the “Escrow Agent”) established pursuant to the terms of a written escrow agreement mutually agreed among the Parties and the Escrow Agent based on the form of agreement provided by Escrow Agent as modified to be consistent with the terms of this Agreement, as applicable.

 

2.                                      Offering.  Subject to the terms and conditions of this Agreement, Fantex will use commercially reasonable efforts to conduct, as promptly as practicable after the Execution Date, a registered offering to the public (the “Offering”) of a new series of securities (the “Series”) linked to the value of the Brand Amount.  Fantex hereby represents, warrants and covenants, as applicable, that following the Offering (if it occurs): (a) the Series shall be publicly traded on an exchange or alternative trading system (the “ATS”) registered with the United States Securities and Exchange Commission (the “SEC”), (b) Fantex Brokerage Services, LLC (“FBS”), an Affiliate of Fantex, shall be a broker-dealer registered with the SEC, and (c) FBS shall be a member of the Financial Industry Regulatory Authority, Inc. (“FINRA”).  Upon written request from Participant from time to time after the commencement of the Offering, Fantex shall provide to Participant reasonable information regarding the progress in connection with the Offering and demand for the Series.

 

3.                                      Financing Contingency; Closing.  The obligations of Fantex to pay the Purchase Price and consummate the transactions contemplated by this Agreement are subject to Fantex obtaining the financing to pay the Purchase Price as contemplated by the Offering, unless waived in writing by the Company. If the Offering does not result in aggregate Net Proceeds at least equal to the Purchase Price (or Fantex does not otherwise waive such condition) on or before the earlier of (i) the date that is one month after the effectiveness of a Registration Statement on Form S-1 (the “Registration Statement”) for the Series filed with the SEC, and (ii) November 30, 2013, or such later date approved by Participant in writing (the “Outside Closing Date”), then as the sole and exclusive remedy therefor, each of Fantex and Participant shall have the unilateral right, exercisable in its sole and absolute discretion, to terminate this Agreement, which termination shall be automatically effective immediately upon delivery of written notice to the other Party.

 

a.              “Gross Proceeds” means an amount equal to the gross proceeds resulting from the Offering.

 

b.              “Net Proceeds” means an amount equal to the Gross Proceeds, less the applicable Underwriting Amount payable to FBS, an Affiliate of Fantex, and such other underwriters selected by Fantex (together, the “Underwriters”).

 

c.               “Underwriting Amount” means underwriting commissions equal to five percent (5%) of the Gross Proceeds of the Offering.

 

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4.                                      Closing.  The Offering shall be consummated on such date as shall be reasonably determined by Fantex (“Closing”), but in no event greater than ten (10) days, after either (a) Fantex has received commitments to purchase the Series such that the Net Proceeds would exceed the Purchase Price, or (b) Fantex has elected in writing to waive the condition contained in the foregoing clause (a).  Upon Closing, Participant will execute and provide to Fantex a written certification in the form attached as Exhibit D.

 

5.                                      Brand Amount.  Participant hereby assigns (as and when earned) to Fantex, all right, title and interest in and to the Brand Amount.  The “Brand Amount” means an amount equal to the product obtained by multiplying (a) any and all Brand Income earned by Participant (whether or not contracted or paid through any third party for or on behalf of Participant, such as a personal services corporation, agency, or otherwise) during the Term, by (b) the Brand Percentage.  Prior to receipt of any Brand Income after the Execution Date, Participant shall execute and deliver to each payor of Brand Income under all contracts existing at such time an irrevocable payment instruction in the form attached as Exhibit G. To the extent that it is not commercially practical, without unreasonable burden to Participant, for installments of the Brand Amount to be delivered directly to Fantex, then such installments of the Brand Amount shall be received by Participant as agent for Fantex, and Participant shall deliver such installments of the Brand Amount to Fantex promptly after the receipt of the corresponding Brand Income by Participant (but in no event later than the fifteenth day following the receipt of such Brand Amount) pursuant to the timing and other terms as set forth in Section 4.1 of the Standard Terms and Conditions.

 

a.                                      “Brand Percentage” equals twenty percent (20%).

 

b.                                      “Brand Income” has the meaning set forth on Exhibit B attached hereto, which excludes the Excluded Income (if any) as defined below.

 

c.                                       “Excluded Income” means: (i) any and all cash or other consideration, in any form whatsoever, earned by Participant from the following entities or their Affiliates as of the date of this Agreement, which shall be not be deemed Brand Income: (A) Fuse Science, Inc.; and (B) Mobli Media Inc; (ii) any amounts not yet payable to Talent pursuant to the “Signing Bonus Addendum” to Talent’s NFL Player Contract dated as of March 5, 2012 or (iii) any merchandise credit (or value thereof) payable to Participant pursuant to that certain agreement, dated effective as of March 1, 2012, between Participant and Under Armour, Inc.

 

d.                                      “Affiliate” means, with respect to any specified Person, any Person that directly or indirectly controls, or is under common control with, or is controlled by, such specified Person.  As used in this definition, “control” (including, with its correlative meanings, “controlled by” and “under common control with”) means possession, directly or indirectly, of power to direct or cause the direction of management or policies (whether through ownership of securities or partnership or other ownership interests, by contract or otherwise).

 

e.                                       “Person” means any individual, corporation, company, voluntary association, partnership, limited liability company, joint venture, trust, unincorporated organization or government (or any agency, instrumentality or political subdivision thereof).

 

6.                                     Principal Business; Claw Back.

 

a.                                      Defined.  For purposes of this Agreement, including the determination of the Field and Brand Income (as set forth in Exhibit B attached hereto), “Principal Business” means a professional athlete in the National Football League (the “NFL”).

 

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b.                                      Claw Back.  If Talent resigns from the Principal Business at any time prior to the second anniversary of the Closing for any reason other than Good Reason, Fantex may elect, in its sole discretion, to terminate this Agreement upon written notice to Participant (the date of such notice is hereinafter referred to as the “Termination Date”).  In the event of such termination, Participant shall pay to Fantex, not later than thirty (30) days following the Termination Date, an amount equal to (i) the Purchase Price plus an amount equal to the Underwriting Amount, minus (ii) all Brand Amounts previously paid to Fantex.  In addition, Participant shall concurrently pay to Fantex interest on the Purchase Price at the rate of five percent (5%) per annum, measured from the date the Purchase Price was paid to Participant.

 

c.                                       “Good Reason” means Talent’s resignation from the Principal Business for any of the following reasons: (i) Talent suffers or sustains any injury, illness or medical condition, after the Closing (any of the foregoing, a “Major Injury”) which renders Talent incapable of performing in the Principal Business; or (ii) Talent suffers or sustains a Major Injury after the Closing and a qualified medical physician (depending on the nature of the Major Injury) advises Talent that as a result thereof Talent is putting his physical health at substantial risk (i.e., a risk that is substantially greater than simply by virtue of Participant’s participation in the Principal Business) by continuing to engage in the Principal Business.

 

d.                                      Dispute Resolution.  In the event of any dispute between Fantex and Participant concerning whether there is Good Reason for any resignation by Talent from the Principal Business, then the Parties shall engage in informal, good faith discussions and attempt to resolve such dispute.  If the Parties are unable to resolve such dispute, then existence of Good Reason shall be determined by a qualified physician selected by agreement of the Parties or, if no agreement can be reached, then each Party shall select a physician qualified in the field applicable to the claimed Good Reason, and those two physicians shall select a third physician qualified in such field to make the final determination regarding such claimed Good Reason.

 

7.                                      Limited Brand Income Encumbrances.  In addition to (i.e., exclusive of) the Brand Percentage, Participant shall ensure that the aggregate amount of all other encumbrances on any Brand Income in connection with the payment of agents, financial advisors and any other fee arrangements based on a percentage of Participant’s income (or any portion thereof) shall not exceed a maximum of (i) fifteen percent (15%) of all Brand Income resulting from any employment or player contracts in any given year, and (ii) thirty percent (30%) of all other Brand Income in any given year.  Without Fantex’s prior written approval, Participant shall not enter into any other arrangement similar to this Agreement (i.e., pursuant to which Participant receives compensation in exchange for a portion of Participant’s future Brand Income) with respect to any portion of the Brand Income.

 

8.                                      Term.  The “Term” of this Agreement shall commence on the Execution Date and continue in perpetuity unless and until terminated pursuant to the terms of this Agreement.

 

9.                                      Notices.  All notices, requests, consents and other communications required or given by the Parties hereunder shall be in writing and shall be deemed to be delivered (i) on the date delivered, if personally delivered or transmitted via facsimile or electronic mail with return confirmation of such transmission; (ii) on the business day after the date sent, if sent by recognized overnight courier service and (iii) on the fifth day (or on the next business day thereafter if such fifth day is not a business day) after the date sent, if mailed by first-class certified mail, postage prepaid and return receipt requested, to the addresses of the applicable Party set forth below:

 

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If to Participant:

 

Mr. Arian Foster

c/o Life Line Financial Group

8447 Wilshire Blvd, Suite 450

Beverly Hills, CA 90211

Attention: Mr. Humble Lukanga

 

with a copy (which is required, but not alone sufficient, to constitute notice hereunder) to:

 

Eisner Kahan Gorry Chapman Ross & Jaffe,

A Professional corporation

9601 Wilshire Blvd., Suite 700

Beverly Hills, CA 90210

Attention: Joe O’Hara, Esq.

Fax: (310) 855-3201

Email: johara@eisnerlaw.com

 

If to Fantex:

 

Fantex, Inc.

330 Townsend Street, Suite 234

San Francisco, CA 94107

Attention: Mr. Dave Mullin, Chief Financial Officer

 

with a copy (which is required, but not alone sufficient, to constitute notice hereunder) to:

 

Latham & Watkins

140 Scott Drive

Menlo Park, CA 94025

Attn: Patrick Pohlen

Fax: (650) 463-2600

Email: Patrick.Pohlen@LW.com

and

David Blood

Fax: (213) 891-8763

Email: David.Blood@LW.com

 

10.                               Standard Terms and Conditions.  The Parties agree to be bound by the Standard Terms and Conditions attached hereto as Exhibit C (the “Standard Terms and Conditions”), which are incorporated herein by this reference.  Any reference in this Agreement or the Standard Terms and Conditions to this “Agreement” shall be deemed to be a reference to this Agreement and the Standard Terms and Conditions, taken as a whole.

 

Upon execution by both Participant and Fantex, this Agreement and the exhibits attached hereto shall constitute a binding commitment of the Parties, as the entire agreement and understanding between the Parties concerning the subject matter hereof and thereof, and shall supersede and replace all prior negotiations, proposed agreements, and discussions, written or oral, relating hereto or thereto.

 

[Signatures on following page]

 

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Please confirm your agreement with the foregoing by signing where indicated below.

 

	
PARTICIPANT:
    	
FANTEX:
    
	
 
    	
 
    
	
Arian   Foster
    	
Fantex, Inc.
    
	
 
    	
 
    
	
By:   
    	
/s/   Arian Foster
    	
 
    	
By:   
    	
/s/   Cornell “Buck” French
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Address:   
    	
8447   Wilshire Blvd, Suite 450
    	
 
    	
Name:   
    	
Cornell   “Buck” French
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
Beverly   Hills, CA 90211
    	
 
    	
Title:   
    	
Chief   Executive Officer
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Date:   
    	
02-28-2013
    	
 
    	
Date:   
    	
02-28-2013
    
	
 
    	
 
    	
 
    	
 
    
	
Ugly Duck, LLC
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
By:   
    	
/s/   Arian Foster
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Name:   
    	
Arian   Foster
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Title:   
    	
Owner
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Date:   
    	
02-28-2013
    	
 
    	
 
    	
 
    

 

Signature Page 

– Brand Agreement –

 

 

Exhibit A

Participant Questionnaire

 

Please answer each of the following questions correctly and completely as of the date hereof.  The completeness and accuracy of each such statement must be answered from the perspective of both the Company and Talent, as applicable, and must be initialed by Talent on behalf of himself and Company where indicated.  Capitalized terms used in this questionnaire shall be defined as set forth in the Brand Agreement (including other Exhibits) to which this questionnaire is attached (the “Agreement”).

 

IMPORTANT:  Review each of the following statements and initial each statement where indicated.  By placing your initials next to each below statement you hereby represent, warrant and covenant, as applicable, that each such statement is true and complete, except only as otherwise disclosed on Schedule 3 of the “Personal Information Schedule” delivered to Fantex in connection with this Agreement.

 

In addition, please provide copies of all documents or other information specifically requested as part of the below statements and/or relevant to any matter for which additional information has been disclosed pursuant to Schedule 3 of the Personal Information Schedule.

 

	
Initials
    	
 
    	
Statement
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
1.   I have read and fully understand the terms and conditions of the Agreement to   which this questionnaire is attached, and I have had the opportunity to be   represented by an attorney in the review, negotiation and execution of the   Agreement and performance of my obligations thereunder.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
2.   I have not made, nor will I hereafter make, any grant, license or assignment   whatsoever, which might conflict with or impair the complete enjoyment of the   rights and privileges granted to Fantex under the Agreement.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
3.   I do not require any consent, approval, authorization or permit from, or   filing or notification to, any Person in connection with my execution and   delivery of the Agreement, and performance of my obligations thereunder.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
4.   I am not subject to any condition, restriction, disability or obligation   (whether physical, legal or contractual), and am otherwise not aware of any   material nonpublic information, which could prevent or interfere with my   continued participation in my Principal Business in a manner consistent with   such participation throughout the preceding year, and I will promptly disclose   the occurrence of any such event to Fantex as required pursuant to   Section 6.2 of the Standard Terms and Conditions (Exhibit C).
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
5. I have never been convicted in a criminal proceeding, nor have I   been named the subject of a criminal proceeding that is presently pending   (excluding only traffic violations and similar minor offenses).
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
6. Except only as listed on Schedule 1, no other Person has any right   to receive any portion of my Brand Income in the form of any commission,   royalty or other payment based on a percentage or set amount of some or all   of the Brand Income. I have secured all necessary consents to make available   for review by Fantex (and have so made available) a complete copy of each   Contract pursuant to which any such payments are owed.
    

 

 

	
AF
    	
 
    	
7. No other Person has any right to demand or receive any portion of   the Brand Income in a manner that conflicts with any rights granted to Fantex   under this Agreement with respect to the Brand Amounts.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
8. I am not a party (plaintiff or defendant) in any lawsuit,   government investigation, arbitration or other legal action, and to my   knowledge, there is no valid basis for any of the foregoing.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
9. I am not subject to any judgment, order or decree of any court or   other government authority.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
10. Schedule 2 consists of a complete list of each contract,   commitment, or other arrangement or understanding (and all amendments and   supplements thereto), whether written or oral (each a “Contract”) to   which Participant is a Party as of the date hereof, or under which   Participant is obligated to perform, or from which Participant receives any   benefit, and in each case which is related to the Principal Business, the   Field and/or Brand Income other than Contracts excluded in their entirety   pursuant to Section 5(c) of the Agreement (each of which are   referred to herein as a “Brand Income Contract”).
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
11. I have provided or made available to Fantex true, correct and   complete copies of each written Brand Income Contract, and an accurate   detailed written summary of each oral Brand Income Contract. Throughout the   Term of the Agreement, I will promptly provide a copy of each new Brand   Income Contract or amendment to any Brand Income Contract once executed by   all of the parties thereto.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
12.   I am currently, and during the past three years have been, in compliance with   all material terms under each Brand Income Contract, to the extent   applicable, and Participant and I have not received any notice regarding any   breach, default, termination or attempt to renegotiate, with respect to any   Brand Income Contract.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
13.   I am not aware of any facts or circumstances that would cause the payments   under the Brand Income Contracts to be materially less than the amounts   specified in the Brand Income Contracts.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
14.   I am not aware of any material breach by any other party under any Brand   Income Contract.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
15.   I have timely paid any taxes, fees or withholdings required by any state or   federal or international government authority. I have also timely filed all   forms and documentation required in connection with any such taxes, fees or   withholdings.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
16.   I am not, and have not been subject to any audit by a government authority in   connection with any taxes or governmental fees. I am not subject to any   unsatisfied judgments or tax liens.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
17.   I have not conducted business, applied for or secured credit in, or received   any official government identification under, any name or alias, other than   the name listed in Section 1 of the Personal Information Schedule   provided by Participant concurrently herewith.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
18.   Neither I, nor any business owned or controlled by me, has ever declared   bankruptcy or settled any debt for less than the amounts actually owed.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
19.   I have the ability to pay all of my debts and obligations as such debts   mature and I do not have any present intention to incur debt beyond my   ability to pay as such debts mature.
    

 

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AF
    	
 
    	
20.   I am not in violation of, and throughout the Term will not materially   violate, any (a) laws, codes, permit requirements, rules, regulations,   ordinances and/or provisions of any foreign, federal, state or local   government authority, including with respect to employment, health and   safety, wage and hours, improper payments, bribery, taxation or securities   laws; or (b) rules, standards or requirements of any league,   organization, governing body or association to which I am a member or under   which I am bound to comply in connection with my participation in the   Principal Business, including regarding gambling, anti-doping, or reporting   of any injury or incidents.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
21.   Without limiting the effect of any statement in this Exhibit A   (Participant Questionnaire), all of the documents and information that I have   provided, and will provide, to Fantex in connection with this Agreement   (including the Personal Information Schedule) are true, correct and complete   in all material respects, except with respect to any statement that, by its   terms, is already limited as to materiality. My responses to this   questionnaire (and any documents or other information provided by me to   Fantex in connection with this Agreement) do not, and will not, contain any   untrue statement or fail to state a material fact necessary to not make any   of such information not misleading, in light of the circumstances in which it   was provided.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
22.   I have disclosed, and throughout the Term will promptly disclose, all facts   and circumstances that could reasonably be expected to be material to Fantex   or any investor or potential investor in the Series in the context of   the transactions contemplated by this Agreement, including any event required   to be reported to the league, organization, governing body or association to   which I am a member or under which I am bound to comply in connection with my   participation in the Principal Business.
    
	
 
    	
 
    	
 
    
	
AF
    	
 
    	
23.   I have obtained advice from my advisors regarding the tax and accounting   consequences of entering into this Agreement and becoming a Participant and   the transactions contemplated hereby, and I am not relying on a   representation, warranty or statement made by Fantex, or any of its   representatives or advisors, regarding such tax and accounting consequences   of becoming a Participant and the transactions contemplated hereby.
    

 

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Exhibit B

Fantex Brand Agreement

Field / Brand Income

 

1.              “Field” means the Principal Business (as defined in the Letter Agreement to which this Exhibit is attached) and any and all of Participant’s activities in connection with each of the following: coaching, football camps, sports television or broadcasting, including play-by-play and commentary, whether in-game or studio analysis (“Sports Television”), radio (terrestrial or satellite), motion picture (to the extent substantially related to or otherwise depicting Talent’s participation in the Principal Business), literary works the subject of which is Talent (other than children’s books), publications, personal appearances, memorabilia signings and events, and the use of Participant’s name, voice, likeness, biography or talents for purposes of advertising and trade, including sponsorships, endorsements, merchandising and appearances.  In the event that there is any ambiguity as to whether an activity is in the Field, the parties shall discuss in good faith and seek to resolve such matter.  In the event that a resolution is not met within 30 days after initial notice by either Party to the other regarding such activity, then either Party shall be free to refer such matter to arbitration for resolution pursuant to the terms of Section 16.5 of the Standard Terms and Conditions.  For the avoidance of doubt, each of the following categories, in their broadest respective meanings, is expressly excluded from the Field: motion picture (to the extent not related to or otherwise depicting Talent’s participation in the Principal Business), regardless of the channels of distribution (i.e., regardless of theatrical, made for TV, Internet, mobile or other channels developed after the Execution Date), television (other than Sports Television), music (including writing, recording, publishing, artist management, touring), children’s books authored by Talent, and any and all merchandising and exploitation rights relating to any of the foregoing excluded categories.

 

2.              “Brand Income” means any and all gross monies or other consideration of any type that Participant may earn, other than Excluded Income (as defined in the Letter Agreement), as a result of Participant’s activities (including licensing of rights) in the Field.  For the avoidance of doubt, “Brand Income,” with respect to any Brand Income Contract, shall expressly not include any merchandise (or the value thereof) or merchandise credit that is immaterial in the overall context of such Brand Income Contract, as determined by Fantex in its reasonable discretion after meaningful consultation with Participant.

 

The term “gross monies or other consideration” shall include, without limitation, salaries, earnings, fees, royalties, bonuses, shares of profit, shares of stock, partnership interests, percentages and the total amount paid for any activities in the Field, and received by Participant or Participant’s heirs, executors, administrators or assigns, or by any other Person on Participant’s behalf, net of any self-employment taxes to which Participant is subject in connection with the receipt of such amounts or items to the extent that such amounts or items constitute Brand Income, but prior to the deduction or withholding of (a) any amounts payable to any third party (e.g., agency commissions), (b) any voluntary or personal deductions (e.g., contributions to retirement funds), or (c) any taxes required to be deducted or withheld by any federal, state or local government authority based on the net income of Participant (but excluding any deduction or withholding for payroll, medicare or FICA taxes or other deductions or payments required to be made to any federal, state or local government authority).  In the event that Participant receives, as all or part of any Brand Income, stock or other equity interests (including membership interests and partnership interests) or the right to purchase stock or other equity interests, then the Brand Percentage of such stock or other equity interest, or right to buy stock or other equity interest, shall be delivered to Fantex as the applicable Brand Amount.  Should Participant be required to make any payment for such stock or other equity interest, then Fantex shall contribute its pro rata share of such payment.  In addition, with respect to any such stock or other equity interest, or any right to purchase stock or other equity interest, Fantex shall make a payment to Participant, within five (5) business days after delivery of the stock or other equity interest (or in the

 

 

case of a right to acquire stock or other equity interest, within five (5) business days after exercising such right to acquire the stock or other equity interest), equal to the amount of any self-employment taxes payable by Participant, or the amount of any payroll, medicare or FICA taxes or other deductions or payments required to be made to any federal, state or local government, in each case in connection with the receipt of such stock or other equity interest or the exercise of the right to acquire the stock or other equity interest.  In addition, to the extent that Participant incurs any additional cost or expense resulting from Fantex participating in such stock or other equity interests, then Fantex shall pay such incremental costs incurred by Participant (i.e., over and above such amounts that Participant would have incurred but for Fantex’s participation).

 

For the avoidance of doubt, the following sources of revenue shall not be included in Brand Income:

 

a.              Any revenues resulting from Participant’s investments in stocks or other equity, bonds, commodities, derivatives or real estate, so long as such stocks or other equity, bonds, commodities, derivatives and real estate are not received by Participant as compensation for activities (including licensing of rights) in the Field.

 

b.              Any income earned from employment or other activities not in the Field.

 

c.               Any reasonable reimbursement of incidental expenses actually incurred by Participant, including travel, lodging, per diem and other incidental expenses.

 

d.              Any Excluded Income.

 

Examples (Brand Income)

 

Examples of income that would be Brand Income include, without limitation, the following:

 

·                  50 Cent received an equity stake in Energy Brands as part of an endorsement deal for Vitamin Water, which would be considered Brand Income because it was consideration for 50 Cent’s endorsement.

·                  Magic Johnson founded Magic Johnson Enterprises to provide entertainment, products and services to urban communities. A portion of Magic Johnson’s income and equity value in Magic Johnson Enterprises would be considered Brand Income of Magic Johnson to the extent that they directly relate to Magic Johnson’s career as a basketball player.  For example, profits from any basketball camps hosted by Magic Johnson Enterprises would be deemed Brand Income because they are in the Field, they directly relate to Magic Johnson’s skills as a basketball player, and operating basketball camps is an activity typically undertaken by a professional basketball player.  However, profits from 24-Hour Fitness clubs owned by Magic Johnson Enterprises (but not bearing or branded with the Magic Johnson name) would not be considered Brand Income because although the clubs could be considered to be in the Field, Magic Johnson’s name and likeness are not used to promote the clubs.  Finally, profits from businesses such as movie theaters and coffee shops, regardless of whether they bear or are branded with the Magic Johnson name, would not be considered Brand Income, because those types of businesses are not directly in the Field.

 

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Examples of types of income that would not be Brand Income include, without limitation, the following:

 

·                  John Elway received an equity stake in Fantex Holdings, Inc., the parent company of Fantex, because he serves on the board of directors.  John Elway’s equity stake in Fantex Holdings, Inc. would not be considered Brand Income because his service as a director of Fantex Holdings is not directly in the Field and John Elway’s selection was attributable to qualifications other than his performance in professional football.

·                  Roger Staubach formed the Staubach Corporation, which became a leading provider of corporate real estate services. Roger Staubach’s income and equity value in the Staubach Corporation, including the sale to Jones Lang LaSalle in 2008, would not be considered Brand Income because this business is not directly in the Field and the success of the enterprise was attributable to qualifications other than his performance in professional football.

·                  Arnold Schwarzenegger served as the governor of California from 2003 to 2011. His income from the state of California would not be considered Brand Income because it is not in the Field.

·                  Kerri Strug was employed as an elementary school teacher and in various positions at the U.S. Treasury and Justice Departments. Her employment as a teacher and various positions at the U.S. Treasury and Justice Departments would not be considered Brand Income because such employment was based on her educational background, training and professional skills unrelated to her Principal Business, and her salary did not exceed the ordinary amount paid to employees in such position with a similar educational background, training and professional skills and is not in the Field.

 

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EXHIBIT C

Fantex Brand Agreement

Standard Terms and Conditions

 

1.              Definitions; Interpretation.

 

1.1.              Capitalized terms used in these Standard Terms and Conditions and not otherwise defined herein, shall have the meaning set forth in the Letter Agreement (and any Exhibits thereto) to which these Standard Terms and Conditions are attached.  In the event of any inconsistency or conflict between these Standard Terms and Conditions and the Letter Agreement, the terms of the Letter Agreement shall govern.

 

2.              Offering.

 

2.1.              Offering. Fantex will use commercially reasonable efforts to conduct the Offering of the Series as promptly as practicable after the Execution Date.  In connection with such Offering, Participant recognizes that Fantex shall have the sole and exclusive right to (and to authorize any other Person to) promote and offer for sale the Series in connection with the Offering.

 

2.2.              Further Assurances; Credit Report Consent. Participant shall execute and deliver to Fantex such further documents, information, consents, forms, instruments, certificates, and other deliveries as Fantex shall reasonably request in writing to further effectuate the intentions of the Parties under this Agreement, or so Fantex can comply with any applicable legal requirements, and Participant recognizes that Fantex will rely on information provided by Participant in the preparation and submission of the Registration Statement and materials to meet other reporting obligations as required by applicable law.  Participant shall reasonably cooperate with Fantex, upon Fantex’s specific request, in connection with the offering, marketing and sales of the Offering and the Series; provided, that any such cooperation that would require any personal services on the part of Talent shall be at times and for durations mutually agreed to by Fantex and Participant; provided further, that any such personal services in the form of a personal appearance by Talent shall be on terms mutually agreed to by Fantex and Participant. Participant hereby consents to Fantex and its agents or representatives (i) obtaining reports of Participant’s credit records from time to time throughout the Term of this Agreement (as reasonably determined by Fantex and at Fantex’s sole cost and expense), and (ii) using the information from that report in connection with any diligence related to Participant and the Offering, and reporting obligations under applicable law.  Upon request by Participant, Fantex shall provide to Participant a copy of any report of Participant’s credit records that is received by Fantex.

 

2.3.              Participant Name and Likeness.  Fantex shall have the non-exclusive, irrevocable, fully paid, worldwide right to use and to authorize other Persons, as determined by Fantex, in its reasonable discretion, to use Participant’s name, likeness, voice and biographical information (collectively, the “Persona”) from the Execution Date until the termination of this Agreement through any and all distribution channels in connection with the offering, marketing and sales of the Offering or the Series; provided, however, that Fantex shall not make any use, or authorize any other party to make any use, of any part of the Persona without the prior written approval of Participant; provided further, that any use of the Persona approved by Participant shall be deemed to be approval of subsequent uses of the same previously approved use until the time that Participant provides written notice to the contrary to Fantex.

 

2.4.              Participant Restrictions.

 

(i)               No Promotion of Series. Except as otherwise expressly approved by Fantex in writing, Participant shall not, and shall not authorize any other Person to, solicit, promote or offer the Series in connection with the Offering.  To the extent that Participant receives unsolicited requests for information regarding the Offering or the Series, then except as otherwise expressly approved by Fantex in writing, Participant shall refer such inquiry to the Registration Statement or to one of the Underwriters of the Offering.

 

(ii)            No Assignment of Similar Rights. Participant has not and will not assign or grant to any other Person rights to receive a portion of Brand Income other than (a) as may be granted in the ordinary course of pursuing activities in the Principal Business (such as commissions payable to an agent or financial advisors), (b) in a manner that will not conflict with the rights granted to Fantex or the obligations of Participant hereunder with respect to any installment payment of the Brand Amount, and (c) in an amount that would not violate any other terms of this Agreement.

 

3.              Purchase Price.

 

3.1.              Payment.  Within fifteen (15) days after the Closing of the Offering, Fantex shall pay to Participant an amount equal to the Purchase Price, less the Escrow

 

 

Holdback, via wire transfer (less any fees charged by any third party in connection with such transfer, such as bank fees) pursuant to the instructions provided in the Personal Information Schedule, or such updated wire transfer instruction as may be provided by Participant to Fantex in writing from time to time.

 

4.              Brand Amount.

 

4.1.              Payment Terms.

 

(i)               Direct Payment.  Participant shall deliver an irrevocable payment instruction in the form attached as Exhibit G to the Letter Agreement to each payor of Brand Income, and otherwise use commercially reasonable efforts to ensure that the Brand Amount is delivered directly to Fantex from each such payor of Brand Income.  To the extent that direct payment from the source of the Brand Income is not commercially practical, without unreasonable burden on Participant, Participant shall comply with paragraph (ii) below and use commercially reasonable efforts to set up automated payments of installments of the Brand Amount through Participant’s banking relationships.

 

(ii)            Alternative Payment; Timing.  To the extent that it is not commercially practical, without unreasonable burden on Participant, for Brand Amounts to be delivered directly to Fantex from any payor of Brand Income, then Participant shall receive such portion of the Brand Amount as agent for Fantex and will deliver such portion of the Brand Amount to Fantex as and when (or as promptly as practicable after) such Brand Income is received by Participant; provided, however, that in no case shall any Brand Amount be delivered later than fifteen (15) days following receipt of funds by Participant (or any other Person on behalf of Participant) with respect to such payment.

 

(iii)         Wire Transfer.  Except as otherwise approved by Fantex in writing, each installment payment of the Brand Amount shall be made via wire transfer pursuant to the wire transfer instructions provided by Fantex to Participant in writing, as may be updated by Fantex from time to time; provided, however, that to the extent that any individual installment payment of the Brand Amount is less than $500, such amount may be paid via check.

 

4.2.              Additional Provisions.

 

(i)               In the event that Participant is prohibited from making payment of any installment of the Brand Amount at the time when same is due and payable to Fantex hereunder by reason of any applicable laws, including currency regulations, Participant shall promptly so advise Fantex and Participant shall, upon Fantex’s request, deposit any such blocked funds to the credit of Fantex in a bank or banks or other depository institution as permitted by law and designated in writing by Fantex, or pay them promptly to such Persons as Fantex may designate in writing consistent with applicable law.

 

(ii)            Participant acknowledges and agrees that time is of the essence in connection with its payment obligations hereunder.  In the event that any payment due to Fantex hereunder is not paid in full by the applicable date due (unless there is a cure period, then by the date the cure period ends), then, without limiting any other rights or remedies of Fantex, Participant shall also pay to Fantex interest on such amount at the rate of the lesser of (a) five percent (5%) per year, compounded monthly, or (b) the maximum rate permitted by applicable law, measured from the date such amount was due until it is fully paid.

 

(iii)         Participant acknowledges and agrees that Fantex may disclose to the public any material breach by Participant of this Agreement, including any failure of Participant to pay any amounts as and when due hereunder (subject to applicable notice and cure periods contained herein); provided, that Fantex covenants and agrees not to make any such disclosure without first notifying Participant and giving Participant a reasonable amount of time to cure such breach, except that no such cure period is required in the event of at least two prior instances of a similar breach (with such notice provided in each instance) during the 12 months period prior to such breach.

 

4.3.              Records.  Participant shall, and shall cause its Affiliates to, maintain (until at least twelve months after termination of this Agreement), records of all Brand Income Contracts, receipts, invoices, reports and other documents relating to the Brand Income and Brand Amount for at least the then current year and previous three (3) calendar years (or such longer period as may be required by law); provided, that the foregoing obligation shall not extend to any time period prior to the Effective Date.

 

4.4.              Audit Rights.  Commencing upon the Effective Date and continuing through the date that is twelve (12) months after termination of this Agreement (“Audit Period”), Fantex or its representatives shall have the right to inspect and make copies of the books and records of Participant (and its Affiliates) relating to the Brand Income Contracts, the Brand Income and Brand Amount.  Such audit shall be at Fantex’s sole cost and expense and shall not cover any period greater than the current year and previous three (3) calendar years at the time of such audit, provided that if an audit

 

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reveals an underpayment of the Brand Amount by greater than five percent (5%) for the period being audited, then Participant shall reimburse Fantex for its reasonable and documented audit costs.  In any case, either (a) Participant shall promptly pay to Fantex any underpaid amount, together with any interest thereon as provided in Section 4.2(ii) or (b) Fantex shall promptly pay to Participant any overpaid amount together with interest at the same rate provided in Section 4.2(ii); provided, that at Participant’s election, Participant may set off against the immediately following installment payment of the Brand Amount an amount equal to such overpayment.  Fantex shall not audit Participant’s books and records more frequently than once per year during the Audit Period.  Fantex shall provide Participant with reasonable advance written notice that it will be conducting an audit, and any such audit shall be conducted during normal business hours.

 

5.              Escrow Holdback.

 

5.1.              Escrow Amount.  Participant hereby authorizes and instructs Fantex to deduct from the Purchase Price otherwise payable to Participant, an aggregate amount equal to the Escrow Holdback.  Fantex shall deposit the Escrow Holdback into an escrow account (the “Escrow Account” and all such funds included in the Escrow Account, the “Escrow Funds”) established pursuant to the terms of a written escrow agreement mutually agreed among the Parties and the Escrow Agent (the “Escrow Agreement”) based on the form of agreement provided by Escrow Agent as modified to be consistent with the terms of this Agreement, as applicable.

 

5.2.              Use of Escrow Amount.  In the event that Participant fails to timely deliver any installment payment of the Brand Amount prior to the release of Escrow Funds pursuant to Section 5.3, then in addition to and without limiting any other rights or remedies available to Fantex, upon written notice from Fantex to the Escrow Agent and Participant, the Escrow Agent shall release to Fantex (up to the amount of available Escrow Funds) an amount equal to such due installment payment of the Brand Amount as notified by Fantex.  Participant shall promptly replenish the Escrow Account by depositing in the Escrow Account an amount equal to any Escrow Funds that are released to Fantex pursuant to this Section 5.2.

 

5.3.              Release of Escrow Amount.  Within five (5) business days immediately following the first consecutive six (6) month period after the Closing during which all installment payments of the Brand Amount have been timely delivered to Fantex when due (subject to applicable notice and cure periods contained herein), then the Escrow Agent shall deliver to Participant all amounts then remaining in the Escrow Account, the Escrow Agreement shall be terminated, and Participant shall thereafter have no obligation to maintain any amounts in the Escrow Account.

 

5.4.              Ownership of Escrow Holdback.  The Parties agree to treat the Escrow Holdback as owned by Fantex until released to Participant pursuant to terms hereof; provided, that any interest accrued on the Escrow Holdback shall be the property of Participant.

 

5.5.              Controlling Terms. In the event of any conflict or inconsistency between the terms of this Section 5 and the terms of the Escrow Agreement, the terms of the Escrow Agreement shall govern.

 

6.              Information Rights; New Contracts.

 

6.1.              Quarterly Reports.  Within ten (10) business days after the end of each calendar quarter during the Term, Participant shall provide to Fantex a report in the form mutually agreed by the Parties (each a “Quarterly Report”), which shall detail all Brand Income earned during such quarter, detail the calculation of the Brand Amount for such quarter with respect to such Brand Income, and provide such additional information and certifications required to be included in the Quarterly Report, including such matters as specified in Exhibit E.

 

6.2.              Material Change.  Participant shall promptly provide written notice to Fantex if at any time after the Execution Date and during the Term of this Agreement, there occurs any condition, restriction, disability or obligation (whether physical, legal or contractual) that will or could reasonably be expected to (i) prevent or materially interfere with Participant’s continued performance under any existing Brand Income Contract, participation in the Principal Business, and/or receipt of endorsements and sponsorships in the Field in a manner consistent with such participation throughout the year prior to such event, or (ii) result in any of the representations or warranties made by the Participant on Exhibit A to be untrue in any material respect; provided, that Participant shall not have any obligation to notify Fantex of the contents of any Brand Income Contract provided by Participant to Fantex, including the expiration of any contract pursuant to its terms.

 

6.3.              Brand Income Contracts.  Throughout the Term, Participant shall promptly (and in any case, no later than five (5) business days after the occurrence of the applicable event, and prior to any public announcement thereof) notify Fantex, in writing, and provide copies of all relevant documents and

 

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correspondence related to each such occurrence (including copies of all Brand Income Contracts), in the event that:

 

(i)               Participant enters into any Brand Income Contract, including any amendments, modifications or supplements to an existing Brand Income Contract, after the Execution Date (“New Brand Income Contract”);

 

(ii)            Participant receives any notice of termination, cancellation, breach or default under any Brand Income Contract;

 

(iii)         Participant becomes aware of any event which, with the passage of time or the giving of notice or both, would result in any material default, breach or event of noncompliance by Participant under any Brand Income Contract;

 

(iv)        Participant becomes aware that any other party to any Brand Income Contract is in material breach thereof or default thereunder; or

 

(v)           there are any renegotiations of or outstanding rights to renegotiate any material amounts paid or payable to Participant under any of the Brand Income Contracts with any Person, or Participant receives any demand for such renegotiation.

 

6.4.              New Brand Income Contracts.  Upon the execution of a New Brand Income Contract, Participant shall be deemed to represent and warrant that such New Brand Income Contract is valid, binding and enforceable against Participant, and enforceable by Participant against the other parties thereto, in accordance with their respective terms, subject to the effect of any applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting creditors’ rights generally, and subject, as to enforceability, to the effect of general principles of equity, as may apply.

 

6.5.              Disclosure of Brand Income Contracts.

 

(i)                         Notwithstanding anything herein to the contrary, Fantex may publicly disclose the terms and conditions of any New Brand Income Contract, to the extent that such disclosure is required in connection with any filing related to the Offering or the Series, as determined by Fantex, upon advice of counsel in connection with such disclosure.

 

(ii)                      Participant shall ensure that any necessary consents to permit disclosure of each New Brand Income Contract (as permitted pursuant to Section 6.5(i)) are obtained so that such disclosure will not result in any breach of any confidentiality obligation to any Person.

 

(iii)                   Fantex shall, in consultation with Participant, use commercially reasonable efforts to secure confidential treatment, or similar protection, with respect to any disclosure of any information contained in any New Brand Income Contract which could reasonably be expected to be sensitive to, or the confidential information of, any counterparty to such New Brand Income Contract.

 

(iv)                  From time to time, as Participant is negotiating or reviewing any potential Brand Income Contract (or any renewal of a Brand Income Contract), Fantex will respond to reasonable requests from Participant (including all relevant details with respect to such potential new or renewed Brand Income Contract) regarding whether or not the terms of such potential Brand Income Contract would be expected to be material and require disclosure pursuant to Section 6.5(i), assuming such Brand Income Contract were executed at the time of such response.  Participant may decide in its sole and absolute discretion whether or not to execute any potential Brand Income Contract (or any renewal of a Brand Income Contract).

 

6.6.              Brand Income Statements.  Concurrent with delivery of each Quarterly Report (as required by Section 6.1), Participant shall also provide copies of all receipts, invoices, pay stubs, or other documents evidencing all Brand Income referenced in the applicable Quarterly Report.

 

6.7.              Marital Status.  Participant shall use reasonable efforts to secure the signature of Participant’s spouse on the spousal consent attached hereto as Exhibit F.  In the event that Participant fails to secure such signature, and as a result a portion of the Brand Income of Participant is deemed “community property” or Participant’s spouse can otherwise claim legal ownership to any Brand Income, then Participant shall nonetheless be required to calculate and deliver any installment payments of the Brand Amount based on the entirety of the Brand Income (including any such portion thereof that is deemed to be such spouse’s share of community property or otherwise property of such spouse).

 

6.8.              Additional Information.  Participant shall provide to Fantex such additional information as Fantex shall reasonably request from time to time (in a reasonable amount of time after such request) in connection with the Brand Income and Participant’s participation in the Principal Business.

 

7.              Taxes.

 

7.1.              Related to Purchase Price.  Participant shall be solely responsible for the payment of all taxes on the

 

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Purchase Price.  Fantex shall be entitled to deduct and withhold any amounts required by applicable law to be deducted and withheld from the Purchase Price and such withheld amounts shall be treated as paid to Participant.  Fantex shall not be required to indemnify or “gross up” Participant for any such amounts withheld.  Participant will indemnify Fantex for and hold it harmless from and against any taxes of Participant which may be sought against, imposed upon or suffered by Fantex or which Fantex may incur as a result of Fantex’s failure to deduct and withhold such taxes from the Purchase Price payable under this Agreement.

 

7.2.              Related to Brand Amounts.  Fantex shall be solely responsible for the payment of all taxes on the Brand Amounts.  Participant shall be entitled to deduct and withhold any amounts required by applicable law to be deducted and withheld from any installment payment of the Brand Amount.  To the extent that any such installment payment of the Brand Amount is made directly from the payor to Fantex and a withholding obligation is imposed on Participant and Participant has no ability to withhold or cause the payor to withhold from such Brand Amounts the required amounts, then Fantex shall make a payment to Participant (for remittance to the applicable taxing authority), within five (5) business days after receipt of such installment payment, equal to the amount that Participant would have been entitled to deduct and withhold hereunder had such installment payment been made by the payor to Participant and subsequently remitted by Participant to Fantex.  Any such withheld amounts, or amounts paid by Fantex to Participant for remittance to the applicable taxing authorities, shall be treated as having been paid to Fantex.  Participant shall not be required to indemnify or “gross up” Fantex for any such amounts withheld.  Fantex will indemnify Participant for and hold it harmless from and against any taxes of Fantex which may be sought against, imposed upon or suffered by Participant or which Participant may incur as a result of Participant’s failure to deduct and withhold such taxes from any installment payment of the Brand Amount to be delivered under this Agreement.

 

8.              Participant Representations and Warranties.

 

Participant hereby represents, warrants and covenants, as applicable, to Fantex that the statements contained in the Participant Questionnaire attached to the Letter Agreement as Exhibit A, and the statements contained in this Section are and will be true and correct as of the date hereof and throughout the Term (except only if a different time period is expressly provided).

 

8.1.              Authority.  Participant is free and authorized to enter into this Agreement, to make the covenants, representations and warranties contained herein and to grant the rights granted herein.

 

8.2.              Binding Agreement.  This Agreement constitutes a valid and binding obligation of Participant (and its successors and heirs), enforceable in accordance with its terms subject to the effect of any applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting creditors’ rights generally, and subject, as to enforceability, to the effect of general principles of equity, as may apply.

 

8.3.              No Conflict.  Participant has not made nor will make any grant, license or assignment whatsoever, which will or could reasonably be expected to conflict with or impair the substantial enjoyment of the rights and privileges granted to Fantex hereunder; and, the execution and performance of this Agreement by Participant does not, and will not, violate or conflict with any agreement, arrangement, understanding or restriction, written or oral, between Participant and any other Person.

 

8.4.              Brokerage.  Except as expressly contemplated by this Agreement, there are no claims for brokerage commissions, finders’ fees or similar compensation in connection with the transactions contemplated by this Agreement based on any contract to which Participant is a party or that is otherwise binding upon Participant.

 

8.5.              Intellectual Property.  No intellectual property provided by Participant to Fantex at any time in connection with this Agreement will violate the rights of privacy or publicity, constitute a libel or slander or infringe upon the copyright, literary, personal, private, civil, property or other rights of any Person.

 

9.              Fantex Representations and Warranties.

 

Fantex represents, warrants and covenants, as applicable, to Participant, as of the date hereof and throughout the Term:

 

9.1.              Organization.  Fantex is duly incorporated, validly existing and in good standing under the laws of the State of Delaware.

 

9.2.              Authority.  Fantex possesses all requisite corporate power and authority necessary to enter into and carry out the transactions contemplated by this Agreement.

 

9.3.              Binding Agreement. This Agreement constitutes a valid and binding obligation of Fantex, enforceable in accordance with its terms subject to the effect of any applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting

 

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creditors’ rights generally, and subject, as to enforceability, to the effect of general principles of equity, as may apply.

 

9.4.              No Conflict. The execution and performance of this Agreement by Fantex does not, and will not, violate or conflict with any agreement, arrangement, understanding or restriction, written or oral, between Fantex and any other Person.

 

9.5.              Brokerage.  Except as expressly contemplated by this Agreement, there are no claims for brokerage commissions, finders’ fees or similar compensation in connection with the transactions contemplated by this Agreement based on any contract to which Fantex is a party or that is otherwise binding upon Fantex.

 

9.6.              Permits.  Fantex and its Affiliates have all permits, licenses, consents and approvals from all applicable governmental and quasi-governmental bodies and agencies, and all self-regulatory organizations, including the SEC and FINRA, necessary for it to carry out the intents and purposes of this Agreement.

 

10.       Confidentiality; Public Statements/Disclosures.

 

10.1.       Confidentiality.  Each Party agrees that the Confidential Information of the other Party will be maintained confidentially and will not be disclosed to any other Person except: (a) as may be required by law or to comply with a valid order of a court of competent jurisdiction, in which event the Party making such disclosure shall promptly notify the other Party and shall seek confidential treatment of such information; (b) to a Party’s employees, agents and representatives (including accountants, auditors, legal advisors, underwriters, etc.), provided that such recipients of the Confidential Information are bound by confidentiality obligations with respect to such disclosure; (c) in order to enforce such Party’s rights under this Agreement; or (d) if mutually agreed to by the Parties in writing or otherwise permitted under this Agreement.  “Confidential Information” means all confidential, proprietary, or commercially sensitive data, materials and/or other information that is either identified as, or reasonably expected to be, confidential information.  Confidential Information of Fantex includes the existence of this Agreement and terms and conditions of this Agreement (until and then only to the extent that such is publicly disclosed by Fantex), and any other non-public information in connection with the Offering, the Series, or Fantex or its Affiliates.  This Section 10 will survive the expiration or termination of this Agreement.

 

10.2.       Public Statements.  Participant will not issue any press release or public statement in connection with this Agreement, the Series and/or the Offering without Fantex’s prior written consent, which consent Fantex may withhold in its sole discretion.  Fantex will not issue any press release or public statement in connection with this Agreement or which makes any reference to Participant, in each case, without Participant’s prior written consent, which consent will not be unreasonably withheld or delayed and shall be deemed granted if Participant fails to respond to any request for such consent within three (3) days after Fantex requests such consent in writing, in accordance with the notice requirements set forth in the Letter Agreement.

 

10.3.       Fantex Disclosures. Notwithstanding anything herein to the contrary, Fantex shall have the right to disclose the terms and conditions of this Agreement and/or any other information provided by Participant related to this Agreement or the Offering or Series (including Brand Income Contracts, subject to Section 6.5), to the extent that such disclosure is required by applicable law in connection with any filing related to the Offering or the Series.  Fantex shall, in consultation with Participant, use commercially reasonable efforts to secure confidential treatment, or similar protection, with respect to any disclosure of personal and confidential information provided by Participant, including the terms and conditions of this Agreement and such information as is provided in the Personal Information Schedule.

 

11.       Termination.

 

11.1.       By Mutual Consent.  This Agreement may be terminated by mutual written consent of Participant (or its successors and heirs) and Fantex.

 

11.2.       By Either Party.  This Agreement may be terminated by either Party by delivering written notice of termination to the extent such is permitted pursuant to Section 3 of the Letter Agreement.

 

11.3.       Effect of Termination.  Upon the effective date of termination, the rights and obligations of the Parties under this Agreement will cease, except for rights and obligations arising out of Sections 4, 7, 10, 13, 15 and 16 of these Standard Terms and Conditions (to the extent applicable).

 

12.       Assignment.

 

12.1.       The rights and obligations of Fantex under this Agreement will inure to the benefit of and will be binding upon the successors and assigns of Fantex, and Fantex shall have the right to assign its rights and delegate its obligations hereunder (a) in whole or in

 

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part to any Affiliate of Fantex, and (b) in connection with a merger, acquisition, corporate restructuring, financing, sale of all or substantially all of its assets, or similar such transaction.

 

12.2.       This Agreement is personal to Participant, and Participant does not have the right to assign this Agreement, whether by operation of law or otherwise,  or to delegate any duties or obligations imposed upon Participant under this Agreement without Fantex’s prior written consent; except only that this Agreement shall be automatically assigned and binding on Participant’s successors and heirs upon the death of Participant; provided, that any assignment and assumption of this Agreement by a personal services corporation (or “loan-out” corporation) that is wholly owned and controlled by Talent in connection with a conversion or merger of the Company into such a corporation shall be expressly authorized hereunder so long as Talent remains the Participant hereunder, jointly and severally with such surviving corporation.

 

13.       Indemnification.

 

13.1.       Participant hereby agrees to indemnify and hold harmless Fantex, its parents, subsidiaries, Affiliates, assigns, successors, and each of their respective officers, directors, agents, representatives and employees (collectively, “Fantex Indemnified Party(ies)”), from and against any and all liabilities, actions, claims, suits, proceedings or investigations of government, quasi-government or administrative agencies, liens, judgments, demands, losses, costs, expenses and damages, including reasonable attorneys’ fees and costs and any and all damages of any kind and nature whatsoever (a “Claim”), arising out of or relating to any breach by Participant, directly or indirectly through any other Person, of any of the terms, covenants, conditions, representations or warranties contained in this Agreement.

 

13.2.       Fantex hereby agrees to indemnify and hold harmless Talent, Company and each of their respective Affiliates, heirs, assigns, successors, and each of their respective officers, directors, members, managers, agents, representatives and employees, as applicable, (collectively, “Participant Indemnified Party(ies)”), from and against any and all Claims by any third party (including any and all Claims brought by any holder of the Series or group of class thereof) arising out of or relating to Participant being a party to this Agreement (except those arising out of or relating to any breach by Participant, directly or indirectly through any other Person, of any of the terms, covenants, conditions, representations or warranties contained in this Agreement), including any and all Claims arising out of or relating to (a) any breach by Fantex of any of the terms, covenants, conditions, representations or warranties contained in this Agreement, (b) any violation of any law by Fantex, including any securities laws or any rules or regulations promulgated thereunder, or (c) the Offering, the Series, or the Registration Statement.

 

13.3.       A Fantex Indemnified Party or Participant Indemnified Party, as applicable (the “Indemnified Party”), shall promptly deliver a written notice to the party from whom indemnification is sought (the “Indemnifying Party”), providing notice (a “Claim Notice”) of any Claim asserted or filed by a third party (a “Third-Party Action”) within twenty (20) days (or such shorter period as reasonably necessary to permit timely response to such Claim) after receipt by the Indemnified Party of notice of such Third-Party Action.  Delay or failure to notify the Indemnitor in accordance with this Section 13.3 will not relieve the Indemnifying Party of any liability that it may have to the Indemnified Party, except to the extent the defense of such Claim is prejudiced by the Indemnified Party’s delay or failure to give such Claim Notice.  Such Claim Notice shall describe in reasonable detail (to the extent known by the Indemnified Party) the facts constituting the basis for such Third-Party Action and the amount of the claimed damages. Within twenty (20) days after delivery of such Claim Notice, the Indemnifying Party may, upon written notice thereof to the Indemnified Party, assume control of the defense of such Third-Party Action with counsel selected by the Indemnifying Party, subject to the Indemnified Party’s approval, which shall not be unreasonably withheld, conditioned or delayed. If the Indemnifying Party does not so assume control of the defense of a Third-Party Action, the Indemnified Party shall have the right to control such defense at its own expense. The non-controlling party may participate in such defense at its own expense. In Third-Party Actions in which the Indemnifying Party is controlling the defense, the Indemnifying Party shall not agree to any settlement of, or the entry of any judgment arising from, any Third-Party Action without the prior written consent of the Indemnified Party, which shall not be unreasonably withheld, conditioned or delayed; provided, that such consent shall not be required if such settlement or judgment (i) fully releases both the Indemnified Party and the Indemnifying Party and (ii) involves only the payment of money damages that are covered in full by the indemnity obligations of the Indemnifying Party hereunder.  In Third-Party Actions in which the Indemnified Party is controlling the defense, the Indemnified Party shall not agree to any settlement of, or the entry of any judgment arising from, any such

 

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Third-Party Action without the prior written consent of the Indemnifying Party, which shall not be unreasonably withheld, conditioned or delayed.

 

14.       Disclaimer of Warranties.

 

14.1.               Except as expressly provided in this Agreement (including Exhibit A, Participant Questionnaire) and to the maximum extent permitted by law, neither Party makes any representation or warranty of any kind, whether implied, statutory, or otherwise and disclaims, without limitation, implied warranties of merchantability, fitness for a particular use, and non-infringement. Each Party acknowledges that it does not rely and has not relied upon any representation or statement made by the other Party or any of its representatives relating to the subject matter of this Agreement except as expressly set forth herein

 

14.2.               In addition to, and without limiting the effect of, Section 14.1 above, Participant expressly acknowledges and agrees that Fantex makes no representation or warranty regarding the results of the Offering, including the amount of Net Proceeds to be collected or otherwise.

 

15.       Agents.

 

15.1.       Fantex shall not be liable for any claims or demands for commissions or otherwise of any agent of Participant and Participant hereby agrees to indemnify and hold harmless Fantex, its Affiliates, advertisers, employees and all holders of the Series against any liabilities, damages or expenses (including reasonable attorneys’ fees) incurred by them as a result of any such claims or demands.

 

16.       General Terms.

 

16.1.       Entire Agreement; Amendments.  The Agreement (including all Exhibits thereto, including these Standard Terms and Conditions) contains the complete, final, exclusive and binding statement of all of the agreements between the Parties with respect to the subject matter thereof and hereof, and supersedes all existing agreements, understandings, negotiations, communications or commitments between the Parties, whether oral or written, concerning the same subject matter.  This Agreement cannot be amended or modified or any provisions or obligations waived or changed except by a writing executed by Fantex and Participant.

 

16.2.       Waiver.  The failure or delay of a Party to insist on strict adherence to any term of this Agreement will not be considered a waiver of, or deprive that Party of the right thereafter to insist on strict adherence to that term or any other term of this Agreement.  No waiver of any breach or default of the other Party shall be construed as a continuing waiver of the same or any other breach or default under this Agreement.

 

16.3.       Further Actions; Attorney-in-Fact.  Participant will, as applicable, at the request of Fantex, execute and deliver to Fantex all such documents as Fantex may from time to time deem reasonably necessary or desirable to effectuate assignment of, and for Fantex to receive all installment payments of, the Brand Amount and otherwise effectuate the purposes of this Agreement.  If Participant fails or refuses to execute or deliver to Fantex any such document within a reasonable period of time following receipt of Fantex’s written request therefor, then Participant irrevocably appoints Fantex as Participant’s agent and attorney-in-fact to sign any such documents in Participant’s name and to make appropriate disposition of them, consistent with this Agreement; provided, that prior to exercising any rights under such power of attorney, Fantex shall notify Participant of its intention to do so.  Participant acknowledges that Fantex’s agency and power of attorney are coupled with an interest.

 

16.4.       Interpretation.  In the interpretation and construction of this Agreement, no term shall be construed against any Party on the basis that the Party was the drafter, and the Parties waive any common law or statutory provision that would construe an ambiguous term against the other Party as the drafter of this Agreement.  Words importing the singular include the plural and vice versa, as the context requires.  Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.”  The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement.  Any reference to “this Agreement,” even if such reference is contained in these Standard Terms and Conditions, shall be a reference to the Letter Agreement and all of the exhibits attached thereto.  The term “or” is not exclusive.  The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such terms.  The captions and headings in this Agreement are inserted for convenience of the Parties only, do not constitute a part of this Agreement and will not be deemed to govern, limit, modify or in any other manner affect the scope, meaning, intent or interpretation of the provisions hereof or have any legal effect.

 

8

 

16.5.       Governing Law; Arbitration.  The law of California (exclusive of conflict or choice of law rules) shall govern, construe and enforce all of the rights and duties of the Parties arising or in any way relating to the subject matter of this Agreement.  In the event of any dispute, claim or controversy arising out of or relating to this Agreement (including any claim based on contract, tort or statute) or the breach, termination, enforcement, interpretation or validity thereof, including the determination of the scope or applicability of this agreement to arbitrate, (a “Dispute”), then the Parties shall engage in informal, good faith discussions and attempt to resolve the Dispute.  If the Parties are unable to resolve the Dispute, then the Dispute shall be determined by confidential binding arbitration in San Francisco before one arbitrator. The arbitration shall be administered by JAMS pursuant to its Streamlined Arbitration Rules and Procedures.  Judgment on any award pursuant to arbitration may be entered in any court of competent jurisdiction.  The arbitrator shall be a retired judge with at least five years of experience presiding over disputes related to complex commercial transactions.  The arbitrator shall be appointed by agreement of the Parties or, if no agreement can be reached, then each Party shall appoint one JAMS arbitrator for the purpose of selecting the arbitrator to govern the Dispute, and those two arbitrators shall select the arbitrator to govern the Dispute.  In any arbitration arising out of or related to this Agreement, the arbitrator shall award to the prevailing Party, if any, the costs and attorneys’ fees reasonably incurred by the prevailing Party in connection with the arbitration.  If the arbitrator determines a Party to be the prevailing Party under circumstances where the prevailing Party won on some but not all of the claims and counterclaims, the arbitrator may award the prevailing Party an appropriate percentage of the costs and attorneys’ fees reasonably incurred by the prevailing Party in connection with the arbitration.  Without limiting the effect of Section 4.2(iii), the Parties shall maintain the confidential nature of the arbitration proceeding and the award, except as may be necessary in connection with a judicial challenge to an award or its enforcement, or unless otherwise required by law or judicial decision.  Notwithstanding anything herein to the contrary, either Party shall be entitled to seek to obtain any provisional remedy, including injunctive or similar relief, from any court of competent jurisdiction as may be necessary to protect that Party’s rights and interests.

 

16.6.       Severability.  Wherever possible, each provision of this Agreement (or portion thereof) will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement (or portion thereof) is held to be null, void, invalid, illegal or unenforceable in any respect under any applicable law or rule by any arbitrator or court of competent jurisdiction, then (a) such provision (or portion thereof) shall be deemed to be restated, to the extent possible, to reflect as nearly as possible the original intentions of the Parties in accordance with applicable law, and if such restatement is not possible, then such provision (or portion thereof) shall be severed, and (b) the remaining provisions, terms or covenants and restrictions in this Agreement will remain in full force and effect.

 

16.7.       No Third Party Beneficiaries.  Nothing herein, express or implied, is intended to nor shall be construed to confer upon or give to any Person, other than the Parties, any interests, rights, remedies or other benefits with respect to or in connection with any agreement or provision contained herein or contemplated hereby.

 

16.8.       Independent Contractors; No Fiduciaries.

 

(i)               The Parties mutually agree that Participant and Fantex are each acting as independent contractors, and that Participant and Fantex are not engaging in any form of employment, partnership, co-ownership or a collaboration for the purpose of sharing any profits or ownership in common, or acting in the capacity of joint venture participants.

 

(ii)            Participant and Fantex each acknowledges and agrees that: (a) this Agreement, and the exercise of rights and performance of obligations hereunder, does not create any agency, advisory or fiduciary relationship between Participant and Fantex and its Affiliates; (b) Fantex is not, and at any time during the Term will not be, an agent, representative or advisor to Participant; and (c) Participant has relied on its own personal counsel and advisors with respect to legal, tax, accounting and other issues in connection with entering into and performing under this Agreement.

 

16.9.       Counterparts; Binding Agreement.  This Agreement, may be executed in multiple counterparts, each of which individually constitutes an original, but all of which together will constitute one single agreement between the Parties.  The Parties agree that this Agreement shall be legally binding upon the electronic transmission, including by facsimile or email delivery of a .pdf or similar file, by each Party of a signed signature page hereof to the other Party.

 

9

 

Confidential

 

Exhibit D:  Form of Closing Certificate

 

CLOSING CERTIFICATE

 

[DATE]

 

Reference is made to that certain Brand Agreement, by and among Fantex, Inc. (“Fantex”), Arian Foster and Ugly Duck, LLC (jointly and severally as “Participant”), dated as of  February 28, 2013 (the “Brand Agreement”).  All capitalized terms used herein which are not defined herein have the meanings given to such terms in the Brand Agreement.

 

The undersigned, Arian Foster, certifies in his individual capacity and on behalf of Ugly Duck, LLC to Fantex that he has carefully examined the Brand Agreement, the Participant Questionnaire and the Personal Information Schedule and that:

 

1.                          the statements included in the Participant Questionnaire remain true and correct (except as disclosed on Schedule 3 of the Personal Information Schedule) as of the date hereof;

 

2.                          Participant has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied under the Brand Agreement in all material respects at or prior to the Closing; and

 

3.                          since the date of the most recent Personal Information Schedule, the undersigned has not become aware of any condition, restriction, disability or obligation (whether physical, legal or contractual) that is described in Section 6.2 of the Standard Terms and Conditions attached as Exhibit C to the Brand Agreement.

 

IN WITNESS WHEREOF, the undersigned has executed this Closing Certificate as of the date first set forth above.

 

 

	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Arian Foster
    

 

 

Confidential

 

Exhibit E:  Quarterly Report

 

Form of report to be mutually agreed by the Parties, and include at least the following details:

 

·                  detail all Brand Income earned during such quarter and provide a description of any material changes in the amount of revenue of the most recent quarter as compared to the same quarter in the previous year;

 

·                  detail the calculation of each Brand Amount with respect to such Brand Income;

 

·                  list all Brand Income Contracts entered into / terminated / amended, etc. during the quarter (and provide copies to the extent not previously provided);

 

·                  describe details regarding any condition, restriction, disability or obligation (whether physical, legal or contractual) that is described in Section 6.2 of the Standard Terms and Conditions attached as Exhibit C to the Agreement;

 

·                  certification that certain publicly available facts about the Participant provided by Fantex to Participant in writing are correct and that all facts previously certified by the Participant remain correct (provided, that Fantex provides Participant with a list of all such previously certified facts); and

 

·                  certification that the statements included in the Participant Questionnaire remain true and correct as of the date of such report (or provide any details with respect to any exceptions of such statements) or provide a detailed description of facts or circumstances that have changed to make the statements in the Participant Questionnaire untrue.

 

 

Confidential

 

Exhibit F:  Spousal Consent

(only required if Participant is married)

 

I, [                      ], being the spouse of Arian Foster, who is a signatory to that certain Brand Agreement dated as of February 28, 2013 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Agreement”; capitalized terms used but not defined herein shall have the meaning assigned to such terms in the Agreement), in connection with a potential securities offering linked to the value of the Brand Amounts as set forth in greater detail in the Agreement.  I have had the opportunity to consult with legal counsel regarding this consent and the Agreement; and I am aware that pursuant to the provisions of the Agreement, my spouse agrees to grant a percentage of my spouse’s Brand Income in the form of all right, title and interest in the Brand Amounts to Fantex, which may include community property interest I may have thereof, if any.  I hereby consent to such grants of the Brand Amounts and approve of the provisions of the Agreement and any actions or performance arising therefrom, as applicable, to the extent the same affects any of my community property interest, if any. I further agree that my spouse may join in any future amendment, restatement, supplement or modification of the Agreement or any ratification of the foregoing in each case without any further consent from me.

 

This Spousal Consent shall be binding on the undersigned and on the undersigned’s successors, assigns, representatives, heirs and legatees.

 

 

	
 
    	
 
    
	
 
    	
Name:
    
	
 
    	
Date:
    

 

 

Confidential

 

Exhibit G:  Form of Irrevocable Payment Instructions

 

IRREVOCABLE PAYMENT INSTRUCTIONS

 

[DATE]

 

[BRAND INCOME SOURCE]

[ADDRESS]

Attn:  [NAME]

 

Re:                             Payment of Amounts to Fantex, Inc. (“Fantex”)

 

Ladies and Gentlemen:

 

Arian Foster (“Participant”) has entered into an agreement with Fantex pursuant to which, among other things, Participant has assigned all right, title and interest in and to an amount equal to twenty  percent (20%) of all gross monies or other consideration of any type (the “Brand Amount”) that Participant may earn from [BRAND INCOME SOURCE] (“Company”) pursuant to [INSERT DESCRIPTION OF BRAND INCOME CONTRACT] (the “Agreement”).

 

Notwithstanding anything to the contrary contained in the Agreement or any prior instructions received by Company, unless and until Company receives written instructions from Fantex to the contrary, effective as of the date of this letter all Brand Amounts from any amounts payable by Company to Participant pursuant to the Agreement shall be delivered concurrent with any payment of the remaining amounts due to Participant, by federal funds wire transfer or electronic depository transfer directly to the following bank account:

 

[INSERT WIRE INSTRUCTIONS]

 

In the event Company receives any different instructions from Fantex with respect to the disposition of Brand Amounts, (a) Company is hereby irrevocably authorized and directed to follow such instructions, without inquiry as to Fantex’s right or authority to give such instructions.  Fantex acknowledges that any instructions from Fantex to Payment Source must be sent to [                                        ], Attention:  [                ]; and (b) such instructions shall only provide for Brand Amounts to be sent to a single deposit account of Fantex.

 

Except only as expressly provided herein with respect to the applicable deposit instructions, this Irrevocable Payment Instructions cannot be changed, modified, or terminated, except by written agreement signed by Fantex, Payment Source and Participant.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

 

Please acknowledge your receipt of, and agreement to, the foregoing by signing in the space provided below.

 

	
 
    	
 
    	
Very   truly yours,
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
 
    	
[Arian   Foster][Ugly Duck, LLC]
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Acknowledged   and Agreed:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Fantex, Inc.
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    	
 
    
	
Date:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
[INSERT   BRAND INCOME SOURCE]
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    	
 
    
	
Date:Exhibit 10.3

 

NFL PLAYER CONTRACT

 

THIS CONTRACT is between Arian Foster, hereinafter “Player,” and Houston NFL Holdings, L.P., a Delaware corporation (limited partnership) (partnership), hereinafter “Club” operating under the name of the Houston Texans as a member of the National Football League, hereinafter “League.” In consideration of the promises made by each to the other, Player and Club agree as follows:

 

1.                                      TERM.  This contract covers 5 football season(s), and will begin on the date of execution or March 1, 2012, whichever is later, and end on February 28 or 29, 2017, unless extended, terminated, or renewed as specified elsewhere in this contract.

 

2.                                      EMPLOYMENT AND SERVICES.  Club employs Player as a skilled football player. Player accepts such employment. He agrees to give his best efforts and loyalty to the Club, and to conduct himself on and off the field with appropriate recognition of the fact that the success of professional football depends largely on public respect for and approval of those associated with the game. Player will report promptly for and participate fully in Club’s official mandatory mini-camp(s), official preseason training camp, all Club meetings and practice sessions, and all pre-season, regular season, and post-season football games scheduled for or by Club. If invited, Player will practice for and play in any all-star football game sponsored by the League. Player will not participate in any football game not sponsored by the League unless the game is first approved by the League.

 

3.                                      OTHER ACTIVITIES.  Without prior written consent of the Club, Player will not play football or engage in activities related to football otherwise than for Club or engage in any activity other than football which may involve a significant risk of personal injury. Player represents that he has special, exceptional and unique knowledge, skill, ability, and experience as a football player, the loss of which cannot be estimated with any certainty and cannot be fairly or adequately compensated by damages. Player therefore agrees that Club will have the right, in addition to any other right which Club may possess, to enjoin Player by appropriate proceedings from playing football or engaging in football-related activities other than for Club or from engaging in any activity other than football which may involve a significant risk of personal injury.

 

4.                                      PUBLICITY AND NFLPA GROUP LICENSING PROGRAM.  (a) Player grants to Club and the League, separately and together, the authority to use his name and picture for publicity and the promotion of NFL Football, the League or any of its member clubs in newspapers, magazines, motion pictures, game programs and roster manuals, broadcasts and telecasts, and all other publicity and advertising media, provided such publicity and promotion does not constitute an endorsement by Player of a commercial product. Player will cooperate with the news media, and will participate upon request in reasonable activities to promote the Club and the League. Player and National Football League Players Association, hereinafter “NFLPA,” will not contest the rights of the League and its member clubs to telecast, broadcast, or otherwise transmit NFL Football or the right of NFL Films to produce, sell, market, or distribute football game film footage, except insofar as such broadcast, telecast, or transmission of footage is used in any commercially marketable game or interactive use. The League and its member clubs, and Player and the NFLPA, reserve their respective rights as to the use of such broadcasts, telecasts or transmissions of footage in such games or interactive uses, which shall be unaffected by this subparagraph.

 

(b)                                 Player hereby assigns to the NFLPA and its licensing affiliates, if any, the exclusive right to use and to grant to persons, firms, or corporations (collectively “licensees”) the right to use his name, signature facsimile, voice, picture, photograph, likeness, and/or biographical information (collectively “image”) in group licensing programs. Group licensing programs are defined as those licensing programs in which a licensee utilizes a total of six (6) or more NFL player images on or in conjunction with products, (including, but not limited to, trading cards, clothing, videogames. computer games, collectibles, internet sites, fantasy games, etc.) that arc sold at retail or used as promotional or premium items. Player retains the right to grant permission to a licensee to utilize his image if that licensee is not concurrently utilizing the images of five (5) or more other NFL player on products that are sold at retail or are used as promotional or premium items. If Player’s inclusion in a particular NFLPA program is precluded by an individual exclusive endorsement agreement, and Player provides the NFLPA with timely written notice of that preclusion, the NFLPA will exclude Player from that particular program. In consideration for this assignment of rights, the NFLPA will use the revenues it receives from group licensing programs to support the objectives as set forth in the By-laws of the NFLPA. The NFLPA will use its best efforts to promote the use of NFL player images in group licensing programs, to provide group licensing opportunities to all NFL players, and to ensure that no entity utilizes the group licensing rights granted to the NFLPA without first obtaining a license from the NFLPA. This subparagraph (b) shall be construed under Virginia law without reference to conflicts of law principles. The assignment in this paragraph shall expire on December 31 of the later of (a) the third year following the execution of this contract, or (b) the year in which this contract expires. Neither Club nor the League is a party to the terms of this paragraph, which is included herein solely for the administrative convenience and benefit of Player and the NFLPA. The terms of this subparagraph apply unless, at the time of execution of this contract, Player indicates by striking out this subparagraph (b) and marking his initials adjacent to the stricken language his intention not to participate in the NFLPA Group Licensing Program. Nothing in this subparagraph shall be construed to supersede or any way broaden, expand, detract from, or otherwise alter in any way whatsoever, the rights of NFL Properties, Inc. as permitted under Article V (Union Security), Section 4 of the 1993 Collective Bargaining Agreement.

 

5.                                      COMPENSATION.  For performance of Player’s services and all other promises of Player, Club will pay Player a yearly salary as follows:

 

$5,000,000 for the 2012 season;

 

 

$5,250,000 for the 2013 season;

 

$5,750,000 for the 2014 season;

 

$6,000,000 for the 2015 season;

 

$6,500,000 for the 2016 season.

 

In addition, Club will pay Player such earned performance bonuses as may be called for in this contract; Player’s necessary traveling expenses from his residence to training camp; Player’s reasonable board and lodging expenses during pre-season training and in connection with playing pre-season, regular season, and post-season football games outside Club’s home city; Player’s necessary traveling expenses to and from pre-season, regular season, and post-season football games outside Club’s home city; Player’s necessary traveling expenses to his residence if this contract is terminated by Club; and such additional compensation, benefits, and reimbursement of expenses as may be called for in any collective bargaining agreement in existence during the term of this contract. (For purposes of this contract, a collective bargaining agreement will be deemed to be in existence” during its stated term or during any period for which the parties to that agreement agree to extend it.)

 

6.                                      PAYMENT.  Unless this contract or any collective bargaining agreement in existence during the term of this contract specifically provides otherwise, Player will be paid 100% of his yearly salary under this contract in equal weekly or bi-weekly installments over the course of the applicable regular season period, commencing with the first regular season game played by Club in each season. Unless this contract specifically provides otherwise, if this contract is executed or Player is activated after the beginning of the regular season, the yearly salary payable to Player will be reduced proportionately and Player will be paid the weekly or bi-weekly portions of his yearly salary becoming due and payable after he is activated. Unless this contract specifically provides otherwise, if this contract is terminated after the beginning of the regular season, the yearly salary payable to Player will be reduced proportionately and Player will be paid the weekly or bi-weekly portions of his yearly salary having become due and payable up to the time of termination.

 

7.                                      DEDUCTIONS.  Any advance made to Player will be repaid to Club, and any properly levied Club fine or Commissioner fine against Player will be paid, in cash on demand or by means of deductions from payments coming due to the Player under this contract, the amount of such deductions to be determined by Club unless this contract or any collective bargaining agreement in existence during the term of this contract specifically provides otherwise.

 

8.                                      PHYSICAL CONDITION.  Player represents to Club that he is and will maintain himself in excellent physical condition. Player will undergo a complete physical examination by the Club physician upon Club request, during which physical examination Player agrees to make full and complete disclosure of any physical or mental condition known to him which might impair his performance under this contract and to respond fully and in good faith when questioned by the Club physician about such condition. If Player fails to establish or maintain his excellent physical condition to the satisfaction of the Club physician, or make the required full and complete disclosure and good faith responses to the Club physician, then Club may terminate this contract.

 

9.                                      INJURY.  Unless this contract specifically provides otherwise, if Player is injured in the performance of his services under this contract and promptly reports such injury to the Club physician or trainer, then Player will receive such medical and hospital care during the term of this contract as the Club physician may deem necessary, and will continue to receive his yearly salary for so long, during the season of injury only and for no subsequent period covered by this contract, as Player is physically unable to perform the services required of him by this contract because of such injury. If Player’s injury in the performance of his services under this contract results in his death, the unpaid balance of his yearly salary for the season of injury will be paid to his stated beneficiary, or in the absence of a stated beneficiary, to his estate.

 

10.                               WORKERS’ COMPENSATION.  Any compensation paid to Player under this contract or under any collective bargaining agreement in existence during the term of this contract for a period during which he is entitled to workers’ compensation benefits by reason of temporary total, permanent total, temporary partial, or permanent partial disability will be deemed an advance payment of workers’ compensation benefits due Player, and Club will be entitled to be reimbursed the amount of such payment out of any award of workers’ compensation.

 

11.                               SKILL, PERFORMANCE AND CONDUCT.  Player understands that he is competing with other players for a position on Club’s roster within the applicable player limits. If at any time, in the sole judgement of Club, Player’s skill or performance has been unsatisfactory as compared with that of other players competing for positions on Club’s roster, or if Player has engaged in personal conduct reasonably judged by Club to adversely affect or reflect on Club, then Club may terminate this contract. In addition, during the period any salary cap is legally in effect, this contract may be terminated if, in Club’s opinion, Player is anticipated to make less of a contribution to Club’s ability to compete on the playing field than another player or players who Club intends to sign or attempts to sign, or another player or players who is or are already on Club’s roster, and for whom Club needs room.

 

12.                               TERMINATION.  The rights of termination set forth in this contract will be in addition to any other rights of termination allowed either party by law. Termination will be effective upon the giving of written notice, except that Player’s death, other than as a result of injury incurred in the performance of his services under this contract, will automatically terminate this contract. If this contract is terminated by Club and either Player or Club so requests, Player will promptly undergo a complete physical examination by the Club physician.

 

13.                               INJURY GRIEVANCE.  Unless a collective bargaining agreement in existence at the time of termination of this contract by Club provides otherwise, the following injury grievance procedure will apply: If Player believes that at the time of termination of this contract by 

 

 

Club he was physically unable to perform the services required of him by this contract because of an injury incurred in the performance of his services under this contract, Player may, within 60 days after examination by the Club physician, submit at his own expense to examination by a physician of his choice. If the opinion of Player’s physician with respect to his physical ability to perform the services required of him by this contract is contrary to that of the Club’s physician, the dispute will be submitted within a reasonable time to final and binding arbitration by an arbitrator selected by Club and Player or, if they are unable to agree, one selected in accordance with the procedures of the American Arbitration Association on application by either party.

 

14.                               RULES.  Player will comply with and be bound by all reasonable Club rules and regulations in effect during the term of this contract which are not inconsistent with the provisions of this contract or of any collective bargaining agreement in existence during the term of this contract. Player’s attention is also called to the fact that the League functions with certain rules and procedures expressive of its operation as a joint venture among its member clubs and that these rules and practices may affect Player’s relationship to the League and its member clubs independently of the provisions of this contract.

 

15.                               INTEGRITY OF GAME.  Player recognizes the detriment to the League and professional football that would result from impairment of public confidence in the honest and orderly conduct of NFL games or the integrity and good character of NFL players. Player therefore acknowledges his awareness that if he accepts a bribe or agrees to throw or fix an NFL game; fails to promptly report a bribe offer or an attempt to throw or fix an NFL game; bets on an NFL game; knowingly associates with gamblers or gambling activity; uses or provides other players with stimulants or other drugs for the purpose of attempting to enhance on-field performance; or is guilty of any other form of conduct reasonably judged by the League Commissioner to be detrimental to the League or professional football, the Commissioner will have the right, but only after giving Player the opportunity for a hearing at which he may be represented by counsel of his choice, to fine Player in a reasonable amount; to suspend Player for a period certain or indefinitely; and/or to terminate this contract.

 

16.                               EXTENSION.  Unless this contract specifically provides otherwise, if Player becomes a member of the Armed Forces of the United States or any other country, or retires from professional football as an active player, or otherwise fails or refuses to perform his services under this contract, then this contract will be tolled between the date of Player’s induction into the Armed Forces, or his retirement, or his failure or refusal to perform, and the later date of his return to professional football. During the period this contract is tolled, Player will not be entitled to any compensation or benefits. On Player’s return to professional football, the term of this contract will be extended for a period of time equal to the number of seasons (to the nearest multiple of one) remaining at the time the contract was tolled. The right of renewal, if any, contained in this contract will remain in effect until the end of any such extended term.

 

17.                               ASSIGNMENT.  Unless this contract specifically provides otherwise, Club may assign this contract and Player’s services under this contract to any successor to Club’s franchise or to any other Club in the League. Player will report to the assignee Club promptly upon being informed of the assignment of his contract and will faithfully perform his services under this contract. The assignee club will pay Player’s necessary traveling expenses in reporting to it and will faithfully perform this contract with Player.

 

18.                               FILING.  This contract will be valid and binding upon Player and Club immediately upon execution. A copy of this contract, including any attachment to it, will be filed by Club with the League Commissioner within 10 days after execution. The Commissioner will have the right to disapprove this contract on reasonable grounds, including but not limited to an attempt by the parties to abridge or impair the rights of any other club, uncertainty or incompleteness in expression of the parties’ respective rights and obligations, or conflict between the terms of this contract and any collective bargaining agreement then in existence. Approval will be automatic unless, within 10 days after receipt of this contract in his office, the Commissioner notifies the parties either of disapproval or of extension of this 10-day period for purposes of investigation or clarification pending his decision. On the receipt of notice of disapproval and termination, both parties will be relieved of their respective rights and obligations under this contract.

 

19.                               DISPUTES.  During the term of any collective bargaining agreement, any dispute between Player and Club involving the interpretation or application of any provision of this contract will be submitted to final and binding arbitration in accordance with the procedure called for in any collective bargaining agreement in existence at the time the event giving rise to any such dispute occurs.

 

20.                               NOTICE.  Any notice, request, approval or consent under this contract will be sufficiently given if in writing and delivered in person or mailed (certified or first class) by one party to the other at the address set forth in this contract or to such other address as the recipient may subsequently have furnished in writing to the sender.

 

21.                               OTHER AGREEMENTS.  This contract, including any attachment to it, sets forth the entire agreement between Player and Club and cannot be modified or supplemented orally. Player and Club represent that no other agreement, oral or written, except as attached to or specifically incorporated in this contract, exists between them. The provisions of this contract will govern the relationship between Player and Club unless there are conflicting provisions in any collective bargaining agreement in existence during the term of this contract, in which case the provisions of the collective bargaining agreement will take precedence over conflicting provisions of this contract relating to the rights or obligations of either party.

 

22.                               LAW.  This contract is made under and shall be governed by the laws of the State of Texas.

 

23.                               WAIVER AND RELEASE.  Player waives and releases any claims that he may have arising out of, related to, or asserted in the lawsuit entitled White v. National Football League, including, but not limited to, any such claim regarding past NFL Rules, the College Draft, Plan B, the first refusal/compensation system, the NFL Player Contract, pre-season compensation, or any other term or condition of employment, 

 

 

except any claims asserted in Brown v. Pro Football, Inc. This waiver and release also extends to any conduct engaged in pursuant to the Stipulation and Settlement Agreement in White (“Settlement Agreement”) during the express term of that Settlement Agreement or any portion thereof. This waiver and release shall not limit any rights Player may have to performance by the Club under this Contract or Player’s rights as a member of the White class to object to the Settlement Agreement during its review by the court in Minnesota. This waiver and release is subject to Article XIV (NFL Player Contract), Section 3(c) of the 1993 Collective Bargaining Agreement (CBA).

 

24.                               OTHER PROVISIONS.  (a) Each of the undersigned hereby confirms that (i) this Contract, renegotiation, extension or amendment sets forth all components of the player’s remuneration for playing professional football (whether such compensation is being furnished directly by the Club by a related or affiliated entity); and (ii) there are not undisclosed agreements of any kind, whether expressed or implied, oral or writen, and there are no promises, undertakings, representations, commitments, inducements, assurances of intent, or understandings of any kind that have not been disclosed to the NFL involving consideration of any kind to be paid, furnished or made available to Player or any entity or person owned or controlled by, affiliated with, or related to Player, either during the term of this contract or thereafter.

 

(b)                                 Each of the undersigned further confirms that, except insofar as any of the undersigned may describe in an addendum to this contract, to the best of their knowledge, no conduct in violation of the Anti-Collusion rules of the Settlement Agreement took place with respect to this contract. Each of the undersigned further confirms that nothing in this contract is designed or intended to defeat or circumvent any provisions of the Stipulation and Settlement Agreement in White v. NFL, including but not limited to the Rookie Pool and Salary Cap provisions; however, any conduct permitted by the CBA and/or the Settlement Agreement shall not be considered a violation of this confirmation.

 

(c)                                  The Club further confirms that any information regarding the negotiation of this contract that it provided to the Neutral Verifier was, at the time the information was provided, true and correct in all material respects.

 

25.                               SPECIAL PROVISIONS.

 

See Attachments

 

THIS CONTRACT is executed in six (6) copies. Player acknowledges that before signing this contract he was given the opportunity to seek advice from or be represented by persons of his own selection.

 

	
/s/ Arian Foster
    	
 
    	
 
    
	
PLAYER Arian Foster  
    	
 
    	
CLUB Houston Texans  
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
/s/ Christian Olsen
    
	
Home Address  
    	
 
    	
By 
    	
Christian Olsen  
    
	
 
    	
 
    	
 
    	
Vice President of Football Administration
    
	
 
    	
 
    	
Club Address 
    	
Two Reliant Park  
    
	
 
    	
 
    	
 
    	
Houston TX 77054
    
	
Telephone Number
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
3/6/12
    	
 
    	
3/6/12
    
	
Date
    	
 
    	
Date
    
					

 

	
 
    	
/s/ Michael McCartney
    	
 
    
	
 
    	
PLAYER’S CERTIFIED AGENT
    Michael McCartney  
    Priority Sports & Entertainment
    	
 
    
	
 
    	
Address  
    325 N. LaSalle Street Suite 650  
    Chicago, IL 60654
    	
 
    
	
 
    	
Telephone Number  
    (312) 664-7700
    	
 
    
	
 
    	
Date 3-6-12
    	
 
    

 

	
Copy Distribution:
    	
 
    	
White-League Office 
   Blue-Management Council
    	
 
    	
Yellow-Player 
   Gold-NFLPA
    	
 
    	
Green-Member Club 
   Pink–Player Agent
    

 

 

 

ATTACHMENT TO
 NFL PLAYER CONTRACT (“CONTRACT”) BETWEEN
 ARIAN FOSTER (“PLAYER”)
 AND
 HOUSTON TEXANS (“CLUB”)
 2012-2016

 

26.                               Additional Player Services.

 

As additional consideration for the compensation provided to Player in the Contract, Player agrees to provide Club with certain promotional services as requested by Club from time to time for no additional compensation, including without limitation:

 

(a)           Player agrees to perform up to a maximum of four (4) hours of service on the Houston Texans Internet Web Site (www.houstontexans.com), (or such other site as may be designated by Club) each month during the term of the Contract. Club and Player will mutually agree on dates and times of service.

 

(b)           Player agrees to fulfill a minimum of eight (8) charitable or public relations/ promotion-related requests for Club during each League Year, provided Club makes the request with reasonable notice to Player and Player does not have any conflict with the date and time of the request. Player will make reasonable efforts to accommodate Club’s requests. These requests may include, but are not limited to, speaking engagements and personal appearances as a representative of Club.

 

(c)           Player agrees to autograph items and memorabilia for Club charitable or public relations/promotional use as reasonably requested by appropriate Club officials.

 

27.                               Media and Marketing.

 

(a)           During the term of the Contract, Club and Player agree to work and cooperate with one another in good faith with respect to all Club media and marketing activities. To that end:

 

(i)            If Player is offered an opportunity to sponsor or endorse a product, service or entity, Player will give Club notice of such offer. If a Substantial Club Sponsor in the applicable category offers Player an opportunity to sponsor or endorse its products, services or entity, and all compensation and other benefits as between the other offer and the offer made by the Substantial Club Sponsor are equal or substantially and materially similar, Player agrees to give greater favor to the Substantial Club Sponsor (which term shall include any sponsor in one of the Designated Categories listed on Exhibit A attached hereto).

 

(ii)           If Player is offered a media opportunity (such as a regularly-scheduled program, show or similar opportunity on television, radio or the Internet (or other interactive media) or similar media, Player will give Club notice of such offer. If a Club Media Partner offers Player a similar media opportunity and all compensation and other benefits as between the other offer and the offer made by Club Media Partner (which term shall include any Club radio, television or other media entity that carries or broadcasts Club’s games or programs/specials) are equal or substantially and materially similar, Player agrees to give greater favor to Club Media Partner.

 

(iii)          Player agrees to work proactively and cooperate with Club to reach agreements with respect to Substantial Club Sponsors and Club Media Partners on a commercially reasonable basis prior to commencing discussions with any competitors of such Substantial Club Sponsor or Club Media Partner. Club will use its commercially reasonable efforts to ensure that Player receives competitive compensation and other benefits so that all such compensation and benefits will be equal or substantially and materially similar to competitive market arrangements.

 

(b)           Notwithstanding the foregoing, this marketing limitation shall not apply with respect to any current sponsorship or endorsement arrangement of Player in effect as of the date of the Contract, which sponsorships and endorsements are listed on Exhibit A attached hereto and shall continue until termination or expiration by their terms.

 

(c)           In no event shall Player be obligated to do any such marketing or media activity not in his best interest as objectively and reasonably advised by his marketing representative or legal counsel.

 

(d)           Player agrees to refrain from engaging in any marketing or media activity, other than through Club, that would reasonably infer Club’s sponsorship or endorsement of such activity, including without limitation, use of Club’s name, logo, mark, color or other symbol identifying Club.

 

	
PLAYER INITIAL
    	
AF
    	
 
    	
CLUB INITIAL
    	
CO
    	
 
    
	
 
    	
 
    
	
DATE
    	
3/6/12
    	
 
    	
DATE
    	
3/6/12
    	
 
    
										

 

Page 2

2012-2016 ATTACHMENT (continued)

 

(e)           Player’s obligations hereunder shall be subject to the provisions of the NFL Group Licensing Program.

 

28.                               Governing Law and Jurisdiction.

 

Further to Paragraph 22 of this Contract and subject in all respects to Article 41 and Article 70, Section 1 of the Collective Bargaining Agreement (“CBA”), dated August 4, 2011, with respect to Governing Law, the parties agree that any dispute, claim or cause of action under this Contract concerning rights and liabilities arising from the Player-Club relationship or arising out of or related to this Contract (a “dispute”) shall be governed by and construed in accordance with the laws of the State of Texas, including without limitation, workers’ compensation disputes. Club and Player agree that jurisdiction of all workers’ compensation claims and other matters related to workers’ compensation, including but not limited to the matters recited in Paragraph 10 of this Contract, and including all issues of law, issue of fact and matters related to workers’ compensation benefits, shall be exclusively determined by the Workers’ Compensation Division of the Texas Department of Insurance and exclusively decided in accordance with the internal laws of the State of Texas, as set forth in the Texas Labor Code, Title 5, Workers’ Compensation, including, without limitation, Section 406.095, without resort to choice of law rules, regardless of the location or situs of the injury giving rise to the dispute. Player acknowledges and understands his right to bring claims for workers’ compensation in multiple jurisdictions, but hereby elects the State of Texas as the sole jurisdiction for resolving his workers’ compensation claims against Club. Player acknowledges that he has received compensation for his knowing waiver of his right to bring such claims in jurisdictions other than Texas. In addition, Club and Player agree that this Contract calls for performance in Harris County, Texas, and further agree that jurisdiction and venue for any and all disputes shall lie exclusively in the State Courts of Harris County, Texas. This Paragraph shall survive termination or expiration of this Contract as respects Club.

 

This Paragraph shall have no application to any injury sustained by Player after this Contract is assigned by waivers or trade to another club domiciled out of the State of Texas.

 

29.                               Insurable Interest.

 

Club has an insurable interest in Player, and Player agrees to cooperate reasonably with Club in all matters pertaining to that interest, including taking a physical examination for insurance purposes.

 

30.                               Tax Ramifications.

 

Club, Player, and Player Representative acknowledge and agree that (a) none of the NFL, its member Clubs, the NFLMC, or any of their advisors or affiliates have any responsibility to provide the NFLPA, any player, or any of their advisors or affiliates with tax advice; (b) the NFLPA does not have any responsibility to provide the NFL, any of its member Clubs, the NFLMC, or any of their advisors or affiliates with tax advice; and (c) the NFLPA does not have any responsibility to provide Player, Player representative, or any of their advisors or affiliates with tax advice. Club does not assume any responsibility with respect to any income, employment, or other tax incurred by Player and Player does not assume any responsibility with respect to any income, employment, or other tax incurred by Club under this Contract.

 

31.                               Automatic Conversions.

 

Player and Club agree that on one or more occasions and at any time during the duration of this Contract, Club shall have the option to (i) convert a portion of Player’s 2012, 2013, 2014, 2015 and/or 2016 Paragraph 5 Salary into Signing Bonus, or (ii) convert part or all of the Roster Bonus(es), if any, set forth in this Contract into Signing Bonus. If Club exercises its option(s) to convert such Paragraph 5 Salary and/or Roster Bonus(es) as provided herein, Club shall use the same form of “Signing Bonus Addendum” as the Signing Bonus Addendum of even date herewith between Player and Club except that (i) such converted Paragraph 5 Salary shall be payable in 17 equal weekly installments over the ensuing Regular Season and (ii) such converted Roster Bonus(es) shall be payable within 10 days after the applicable Roster Bonus was originally to be paid. Player agrees to execute superseding NFL Player Contract(s) effecting the conversion(s) without receiving any additional consideration from Club.

 

Player further agrees that the conversion(s) itself (or themselves), if effected, shall constitute valuable and adequate consideration for Player’s agreement to execute the new NFL Player Contract(s) and that Player shall be in default under the terms and conditions of this Contract if he refuses or fails to promptly execute the new NFL Player Contract(s) after requested by Club.

 

32.                               Representation and Warranty.

 

By signing this Contract, Player hereby represents and warrants, as of the date of his signature, except as otherwise disclosed to Club, that he has (1) not been charged with, indicted for, convicted of or pled nolo contendere to any felony and/or misdemeanor involving fraud or moral turpitude, and (2) not engaged in conduct which could subject him to a charge, indictment or conviction of any such offense. Player acknowledges and agrees his full and complete disclosure to Club of all information related to this representation and 

 

	
PLAYER INITIAL
    	
AF
    	
 
    	
CLUB INITIAL
    	
CO
    	
 
    
	
 
    	
 
    
	
DATE
    	
3/6/12
    	
 
    	
DATE
    	
3/6/12
    	
 
    
										

 

Page 3

2012-2016 ATTACHMENT (continued)

 

warranty has been relied upon by Club and is a condition precedent and material inducement to Club’s entering into this Contract and Club’s payment to Player of any amounts hereunder.

 

33.                               2012 One Year Conditional Full Paragraph 5 Skill, Injury, and Salary Cap Guarantee (“2012 Guarantee”).

 

Despite any contrary language in this Contract, Club agrees that for the 2012 League Year only, Club will pay Player Five Million and No/100 Dollars ($5,000,000.00) of the Five Million and No/100 Dollars ($5,000,000.00) salary provided in Paragraph 5, despite the fact that Player’s Contract is terminated via the NFL waiver system (i) because, in Club’s sole judgment, Player’s skill or performance has been unsatisfactory as compared with that of other players competing for positions on Club’s roster; and/or (ii) if due to a NFL football related injury or death suffered while performing services pursuant to the Contract, Player is unable, in the sole discretion of Club’s physician, to pass Club’s preseason physical examination for the 2012 League Year as a result of such injury and/or (iii) due to Club’s determination to create room for “Salary Cap” purposes (in any year in which a salary cap is in effect). The 2012 Guarantee by Club will not apply in any year after 2012, regardless of whether Player is, as of this date, under contract or option to Club for a subsequent year, and regardless of whether Player passes Club’s physical examination for a year subsequent to 2012.

 

Player shall be in default of his obligations under this Paragraph if in the 2012 League Year (a) Player, without the prior written consent of Club’s Head Coach or General Manager, fails or refuses to report to Club or fails to practice with or play for Club or leaves Club for any reason whatsoever (other than Player’s injury (or death resulting therefrom) suffered while performing services under the Contract), including, but not limited to, (i) Player’s retirement; (ii) Player’s incarceration; (iii) Player’s injury or disability resulting from his breach of Paragraph 3 of the Contract or as a result of his participating in hazardous activities which involve a significant risk of personal injury and are non-football in nature, including, without limitation, water or snow skiing, surfing, hang gliding, bungee jumping, scuba diving, sky diving, rock or mountain climbing, race car driving as driver or passenger, riding a motorcycle, motor bike, all-terrain or similar vehicle as driver or passenger, travel on or flight in any test or experimental aircraft, or serving as a pilot or crew member on any flight; and (iv) Player’s suspension by the NFL or Club for Conduct Detrimental or for violating any of the NFL’s disciplinary policies or programs, specifically including the NFL Personal Conduct Policy but specifically excluding the NFL Policy and Program for Substances of Abuse and the NFL Policy on Anabolic Steroids and Related Substances, or (b) Player materially breaches any provision of this Contract, including, without limitation, any representation and warranty. In the event Player is in default hereunder, then the 2012 Guarantee shall immediately be deemed null and void from the beginning and in its entirety regardless of whether or not the 2012 Guarantee had otherwise been earned according to its terms at the time of Player’s default, and Club shall be relieved of the obligation to guarantee such forfeited proportionate amount.

 

In the event of any such default, Player will be entitled to earn the specified Paragraph 5 Salary on a non-guaranteed basis, subject to any applicable fines and/or forfeitures. This 2012 Guarantee is for the 2012 League Year only and in no way supersedes or obviates the applicability of the League’s waiver system to Player nor does it provide Player a guaranteed spot on the Club’s roster.

 

If Player becomes entitled to the 2012 Guarantee by reason of termination of this Contract, Club shall pay the unpaid amounts of the 2012 Guarantee no later than the earlier of: (i) the date(s) set forth in the Contract; or (ii) a date determined by Club that is no later than the last day of the “applicable 21⁄2 month period” (as defined in Treas. Reg. § 1.409A-1(b)(4)(i)(A)). Any payment made before the payment date that would apply if not for termination of this Contract shall be discounted to the then-present value determined in accordance with the one-year Treasury Note rate published in The Wall Street Journal of February 1 of the calendar year in which the Contract is terminated (or, if The Wall Street Journal is not published on such February 1, then the last day before such February 1 on which The Wall Street Journal is published).

 

In the event this Contract is terminated and Player subsequently plays for any football organization (including Club), Club’s obligation under this 2012 Guarantee shall be reduced by the amount of any and all compensation (including, without limitation, salary, signing, reporting, workout, roster, option, and/or incentive bonuses) received, earned or that reasonably could have been earned by Player from such other football organization or Club, as applicable, during or with respect to the remainder of the term covered by this 2012 Guarantee, and Player shall reimburse Club for any such amounts.

 

34.                               2013 One Year Conditional Partial Paragraph 5 Skill, Injury, and Salary Cap Guarantee (“2013 Guarantee”).

 

Despite any contrary language in this Contract, Club agrees that for the 2013 League Year only, Club will pay Player Three Million Two Hundred Fifty Thousand and No/100 Dollars ($3,250,000.00) of the Five Million Two Hundred Fifty Thousand and No/100 Dollars ($5,250,000.00) salary provided in Paragraph 5, despite the fact that Player’s Contract is terminated via the NFL waiver system (i) because, in Club’s sole judgment, Player’s skill or performance has been unsatisfactory as compared with that of other players competing for positions on Club’s roster; and/or (ii) if due to a NFL football related injury or death suffered while performing services pursuant to the Contract, Player is unable, in the sole discretion of Club’s physician, to pass Club’s preseason physical examination for the 2013 League Year as a result of such injury and/or (iii) due to Club’s determination to create room for “Salary Cap” purposes (in any year in which a salary cap is in effect). The 2013 Guarantee by Club will not apply in any year after 2013, regardless of whether Player

 

	
PLAYER INITIAL
    	
AF
    	
 
    	
CLUB INITIAL
    	
CO
    	
 
    
	
 
    	
 
    
	
DATE
    	
3/6/12
    	
 
    	
DATE
    	
3/6/12
    	
 
    
										

 

Page 4

2012-2016 ATTACHMENT (continued)

 

is, as of this date, under contract or option to Club for a subsequent year, and regardless of whether Player passes Club’s physical examination for a year subsequent to 2013.

 

Player shall be in default of his obligations under this Paragraph if in the 2013 League Year (a) Player, without the prior written consent of Club’s Head Coach or General Manager, fails or refuses to report to Club or fails to practice with or play for Club or leaves Club for any reason whatsoever (other than Player’s injury (or death resulting therefrom) suffered while performing services under the Contract), including, but not limited to, (i) Player’s retirement; (ii) Player’s incarceration; (iii) Player’s injury or disability resulting from his breach of Paragraph 3 of the Contract or as a result of his participating in hazardous activities which involve a significant risk of personal injury and are non-football in nature, including, without limitation, water or snow skiing, surfing, hang gliding, bungee jumping, scuba diving, sky diving, rock or mountain climbing, race car driving as driver or passenger, riding a motorcycle, motor bike, all-terrain or similar vehicle as driver or passenger, travel on or flight in any test or experimental aircraft, or serving as a pilot or crew member on any flight; and (iv) Player’s suspension by the NFL or Club for Conduct Detrimental or for violating any of the NFL’s disciplinary policies or programs, specifically including the NFL Personal Conduct Policy but specifically excluding the NFL Policy and Program for Substances of Abuse and the NFL Policy on Anabolic Steroids and Related Substances, or (b) Player materially breaches any provision of this Contract, including, without limitation, any representation and warranty. In the event Player is in default hereunder, then the 2013 Guarantee shall immediately be deemed null and void from the beginning and in its entirety regardless of whether or not the 2013 Guarantee had otherwise been earned according to its terms at the time of Player’s default, and Club shall be relieved of the obligation to guarantee such forfeited proportionate amount.

 

In the event of any such default, Player will be entitled to earn the specified Paragraph 5 Salary on a non-guaranteed basis, subject to any applicable fines and/or forfeitures. This 2013 Guarantee is for the 2013 League Year only and in no way supersedes or obviates the applicability of the League’s waiver system to Player nor does it provide Player a guaranteed spot on the Club’s roster.

 

If Player becomes entitled to the 2013 Guarantee by reason of termination of this Contract, Club shall pay the unpaid amounts of the 2013 Guarantee no later than the earlier of: (i) the date(s) set forth in the Contract; or (ii) a date determined by Club that is no later than the last day of the “applicable 21⁄2 month period” (as defined in Treas. Reg. § 1.409A-1(b)(4)(i)(A)). Any payment made before the payment date that would apply if not for termination of this Contract shall be discounted to the then-present value determined in accordance with the one-year Treasury Note rate published in The Wall Street Journal of February 1 of the calendar year in which the Contract is terminated (or, if The Wall Street Journal is not published on such February 1, then the last day before such February 1 on which The Wall Street Journal is published).

 

In the event this Contract is terminated and Player subsequently plays for any football organization (including Club), Club’s obligation under this 2013 Guarantee shall be reduced by the amount of any and all compensation (including, without limitation, salary, signing, reporting, workout, roster, option, and/or incentive bonuses) received, earned or that reasonably could have been earned by Player from such other football organization or Club, as applicable, during or with respect to the remainder of the term covered by this 2013 Guarantee, and Player shall reimburse Club for any such amounts.

 

	
PLAYER INITIAL
    	
AF
    	
 
    	
CLUB INITIAL
    	
CO
    	
 
    
	
 
    	
 
    
	
DATE
    	
3/6/12
    	
 
    	
DATE
    	
3/6/12
    	
 
    
										

 

Page 5

2012-2016 ATTACHMENT (continued)

 

35.                               2012-2016 Forty-Six (46) Man Active Roster Bonuses.

 

Player will receive a bonus in the amount of Thirty-One Thousand Two Hundred Fifty and No/100 Dollars ($31,250.00) (each a “Game Roster Bonus” and collectively the “2012-2016 Roster Bonuses”) for each of the sixteen (16) games during each of the 2012-2016 Regular Seasons that he is a member of the Club’s 46-Man Active Roster, commencing with Game 1 of each such Regular Season. Each Game Roster Bonus, if earned, will be paid concurrent with Player’s Paragraph 5 salary during the Regular Season. The maximum amount Player can earn under this Paragraph 35 is Five Hundred Thousand and No/100 Dollars ($500,000.00) for each of the 2012-2016 League Years. THE MAXIMUM AMOUNT PLAYER CAN EARN UNDER THIS PARAGRAPH 35 FOR THE ENTIRE TERM OF THIS CONTRACT (2012-2016 LEAGUE YEARS) IS TWO MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($2,500,000.00).

 

Notwithstanding anything to the contrary herein, if, during any League Year, Club participates in more than sixteen (16) Regular Season games, then Player will receive an amount for each game he is a member of Club’s 46-Man Active Roster equal to Five Hundred Thousand and No/100 Dollars ($500,000.00) divided by the number of Regular Season games in the applicable League Year(s). For example, if Club participates in eighteen (18) Regular Season games in the 2016 League Year, then Player will receive Twenty-Seven Thousand Seven Hundred Seventy Seven and 77/100 Dollars ($27,777.77) for each Regular Season game he is a member of the Club’s 46-man Active Roster.

 

It is expressly understood that no part of any Game Roster Bonus is part of any salary specified in the Contract, that the Game Roster Bonus shall not be deemed part of any salary specified in the Contract if Club exercises any option for Player’s services in a League Year subsequent to the final League Year, and that such obligations of Club are not terminable via the NFL Waiver System, provided that Player has not defaulted under or breached the terms of the Contract, including this Attachment, prior to such Contract termination.

 

Player shall be subject to forfeiture of Salary to the maximum extent permitted under Article 4, Section 9 of the CBA, dated August 4, 2011. For the purposes of this Paragraph, Salary refers to the 2012-2016 Roster Bonuses payable to Player as described above.

 

Player hereby expressly authorizes Club, in its sole discretion with prior notice to Player, to deduct and offset, at any time and from time to time, all or part of any sums owed by Player to Club hereunder from any current or deferred wages, salaries, bonuses and/or additional compensation owed to Player by Club. Such deductions will be made in accordance with Article 4, Section 9(h) of the CBA, dated August 4, 2011. If the full outstanding amount owed to Club cannot be satisfied by such deductions as set forth above, then Club shall retain all available rights and remedies to compel immediate payment.

 

	
PLAYER INITIAL
    	
AF
    	
 
    	
CLUB INITIAL
    	
CO
    	
 
    
	
 
    	
 
    
	
DATE
    	
3/6/12
    	
 
    	
DATE
    	
3/6/12
    	
 
    
										

 

 

Page 6

2012-2016 ATTACHMENT (continued)

 

36.                               2013-2016 Paragraph 5 Salary De-Escalator.

 

For each of the 2013 through 2016 League Years, if Player fails to fully satisfy any of the following conditions:

 

(a)                                 Player satisfactorily participates in and completes Club’s “Off-Season Program”. For the purposes of this Contract, Player shall be deemed to have satisfactorily participated in and completed Club’s “Off-Season Program” under the following circumstances:

 

(i)                                     Player has satisfactorily completed participation in at least eight (8) of the nine (9) total weeks of Club’s scheduled “Off-Season Program”, including any Club mandatory mini-camp(s); and

 

(ii)                                  Calculation of Player’s number of weeks of completion will be based upon the completion of four (4) total days in each week of Club’s nine (9) week “Off-Season Program” as prescribed by the Club’s Head Strength and Conditioning Coach or his designated staff member. Any workouts in excess of four (4) days per week and workouts performed before or after the Club’s nine (9) week “Off-Season Program” will not count towards the calculation of credited participation and completion; and

 

(iii)                               Player’s workout schedule and successful completion of such workouts will be determined solely by Club’s Head Strength and Conditioning Coach and any schedule changes must be approved by the Club’s Head Strength and Conditioning Coach or the Head Athletic Trainer as soon as practicable; or

 

(b)                                 Player timely reports to and fully participates in Club’s entire off-season mandatory Veteran mini-camp(s); or

 

(c)                                  Player timely reports to and fully participates in the Club’s entire pre-season training camp(s); or

 

(d)                                 From the execution of this Contract until the Tuesday immediately preceding Club’s first (1st) Regular Season game of each League Year (2013-2016), Player otherwise honors all of his contractual obligations to Club,

 

THEN, Player’s Paragraph 5 Salary for that League Year shall be reduced by One Hundred Thousand and No/100 Dollars ($100,000.00). Nothing contained in this Paragraph 36 will constitute a guarantee of any portion of Player’s Paragraph 5 Salary included in the Contract.

 

If Player is unable to participate fully and satisfactorily in the “Off-Season Program” due to injury, Player must rehabilitate such injury as required by and under the supervision of Club’s Head Athletic Trainer until such time as full participation in the “Off-Season Program” can be achieved. Supervised rehabilitation by Player with Club’s Head Athletic Trainer will count towards Player’s eight (8) week completion requirement. Player’s satisfactory participation in the “Off-Season Program” shall be determined solely upon records maintained by Club, which shall be final and binding on the parties.

 

37.                               409A Requirements.

 

Except to the extent that an intent to be subject to Section 409A is expressly set forth in the Contract, this Contract shall be interpreted and administered consistent with the intent that all compensation payable hereunder shall be exempt from the requirements of Section 409A of the Internal Revenue Code by reason of the “short-term deferral” rule set forth in Treas. Reg. § 1.409A-1(b)(4). No payment shall be made after the “applicable 2-1/2 month period” (as defined in Treas. Reg. §1.409A-1(b)(4)(i)(A)).

 

	
PLAYER INITIAL
    	
AF
    	
 
    	
CLUB INITIAL
    	
CO
    	
 
    
	
 
    	
 
    
	
DATE
    	
3/6/12
    	
 
    	
DATE
    	
3/6/12
    	
 
    
										

 

Page 7

2012-2016 ATTACHMENT (continued)

 

TO THE EXTENT ANY TERM SET FORTH ABOVE IS DEEMED UNENFORCEABLE BECAUSE SUCH TERM CONFLICTS WITH THE COLLECTIVE BARGAINING AGREEMENT, DATED AUGUST 4, 2011 OR FOR ANY OTHER REASON, THE REMAINDER OF THE TERMS SHALL REMAIN IN FULL FORCE AND EFFECT AND SUCH UNENFORCEABLE TERM SHALL BE REDUCED TO THE EXTENT NECESSARY SO THAT THE TERM,  AS SO REDUCED, IS ENFORCEABLE (INCLUDING, BUT NOT LIMITED TO, ANY PROVISION RELATING TO THE REPAYMENT BY PLAYER TO CLUB OF ANY UNEARNED PORTION OF ANY PAYMENT PROVIDED FOR HEREUNDER, WHICH SHALL BE REDUCED TO THE MAXIMUM AMOUNT PERMITTED BY THE TERMS OF THIS CONTRACT AND THE CBA, DATED AUGUST 4, 2011. THE INVALIDITY OR UNENFORCEABILITY OF ANY PROVISION OF THIS CONTRACT SHALL NOT AFFECT THE VALIDITY OR ENFORCEABILITY OF ANY OTHER PROVISION HEREOF, WHICH SHALL REMAIN IN FULL FORCE AND EFFECT, AND THIS CONTRACT SHALL BE CONSTRUED AS IF SUCH UNENFORCEABLE PROVISION HAD NEVER BEEN CONTAINED HEREIN. FURTHERMORE, IN LIEU OF SUCH UNENFORCEABLE PROVISION, THERE SHALL BE ADDED AUTOMATICALLY AS A PART OF THIS CONTRACT A PROVISION AS SIMILAR IN ITS TERMS TO SUCH UNENFORCEABLE PROVISION AS MAY BE PERMITTED BY THE TERMS OF THE CBA, DATED AUGUST 4, 2011.

 

	
PLAYER INITIAL
    	
AF
    	
 
    	
CLUB INITIAL
    	
CO
    	
 
    
	
 
    	
 
    
	
DATE
    	
3/6/12
    	
 
    	
DATE
    	
3/6/12
    	
 
    
										

 

Page 8

2012-2016 ATTACHMENT (continued)

 

EXHIBIT A

 

Designated Categories

 

	
Category:
    	
 
    	
Defined as:
    
	
Airline
    	
 
    	
Anything that flies
    
	
Automotive
    	
 
    	
Anything on four wheels
    
	
Beer
    	
 
    	
Beer; Wine; Spirits; Mixers
    
	
Energy
    	
 
    	
Electricity and Natural Gas
    
	
Financial/Banks
    	
 
    	
Banks; Investments
    
	
Furniture/Electronics
    	
 
    	
Retail Furniture and Electronic
    
	
Gasoline
    	
 
    	
Oil and Gasoline (refined and unrefined/retail   and wholesale); Automotive Aftermarket
    
	
Grocery
    	
 
    	
Supermarts; Warehouse clubs; Convenience marts
    
	
Healthcare
    	
 
    	
Hospitals; Health care providers; Rehab
    
	
Home Improvement
    	
 
    	
Hardware; Do-it-yourself Super Stores
    
	
Insurance
    	
 
    	
All insurance companies
    
	
Quick Service Restaurants
    	
 
    	
Fast food; Dine-in; Pizza; Take-out
    
	
Soda/Water/Tea
    	
 
    	
Carbonated and Non-carbonated Non-alcohol   Beverages
    
	
*Telecom/Wireless/Technology
    	
 
    	
All telecom-related business, both voice and   data; Wireless communications; Telecommunications-related technology,   including Internet Service Providers
    

 

*“Dot.com” companies will be classified by their core business (e.g., Groceryworks.corn is in Grocery Category; America Online is in the Telecom/Wireless/Technology category).

 

Other Sponsorship and Endorsements

 

1) Mobli Media Inc — Technology Category;

2) Boombah - Apparel and Shoe Category;

3) Game Breaker Sports — Memorabilia and Signing Category;

4) Pro Tips 4 U — Technology Category;

5) Muscle Prodigy - Health and fitness mobile device application category;

6) Joe Myers Ford —LOCAL automotive dealership only. Expires 2013;

7) Wristband.net - Wristbands only;

8) Fuse Science Contract — Soda, Water Tea Category: Nutritional Supplements, Nutraceuticals, nutritional, medical, dietary supplement, including without limitation in the sports and fitness field; This is important since it covers a wide range including sports and energy drinks;

9) ProCamps Contract —Football Camps;

10) Verizon Contract - Texans Sponsor Expires June 30, 2012

 

	
PLAYER INITIAL
    	
AF
    	
 
    	
CLUB INITIAL
    	
CO
    	
 
    
	
 
    	
 
    
	
DATE
    	
3/6/12
    	
 
    	
DATE
    	
3/6/12
    	
 
    
										

 

 

Signing Bonus Addendum
 to NFL Player Contract

 

This Signing Bonus Addendum (the “Agreement”), dated as of March 6, 2012, is between ARIAN FOSTER (“Player”) and Houston NFL Holdings, L.P. (“Club”), and is attached and made a part for all purposes of the NFL Player Contract of even date herewith between Player and Club (the “Contract”) for the League Years 2012-2016 (the “Contract Year(s)”).

 

1.                                      As additional consideration for the execution of the Contract for the Contract Years, for Player’s receiving medical clearance to practice and play after taking Club’s physical examination, Club agrees to pay Player the sum of Twelve Million Five Hundred Thousand and No/100 Dollars ($12,500,000.00) as a signing bonus (the “Signing Bonus”), payable as follows:

 

	
Amount:
    	
 
    	
Due and Payable:
    	
 
    
	
$
    	
3,125,000
    	
 
    	
Within fifteen (15) days after March 15,   2012;
    	
 
    
	
$
    	
1,562,500
    	
 
    	
Within five (5) days after   September 15, 2012;
    	
 
    
	
$
    	
1,562,500
    	
 
    	
Within five (5) days after   December 15, 2012;
    	
 
    
	
$
    	
6,250,000
    	
 
    	
Within five (5) days after March 25,   2013
    	
 
    

 

2.                                      Player’s entitlement to the Signing Bonus is expressly conditional on Player’s receiving medical clearance to practice and play after taking the physical examination. Player’s entitlement to the Signing Bonus and Player’s obligation to forfeit and return (or relinquish and forego) the Signing Bonus shall be governed exclusively by the terms of Article 4, Section 9 of the Collective Bargaining Agreement, dated August 4, 2011. Payment of the Signing Bonus prior to Player’s passing Club’s physical examination shall not be a waiver of the condition that he receive medical clearance to practice and play.

 

3.                                      It is expressly understood that no part of the Signing Bonus is part of any salary specified in the Contract, that the Signing Bonus shall not be deemed part of any salary specified in the Contract if Club exercises any option for Player’s services in a Contract Year subsequent to the final Contract Year, and that such obligations of Club are not terminable if the Contract is terminated for skill or injury via the NFL Waiver System, provided that Player has not breached the terms of the Contract or this Agreement prior to such Contract termination.

 

4.                                      Forfeiture of Signing Bonus. Player shall be subject to forfeiture of Salary to the maximum extent permitted under Article 4, Section 9 of the CBA, dated August 4, 2011. For the purposes of this Agreement, Salary refers to the Signing Bonus payable to player as described above.

 

5.                                      It is understood and agreed that Player’s waiver of rights to certain unpaid and/or unearned amounts and Player’s obligation to repay or refund certain portions of the Signing Bonus in the event Player breaches hereunder are express conditions of the Contract and this Agreement, and, but for these conditions, Club would not have executed the Contract and this Agreement. Player hereby expressly authorizes Club, in its sole discretion, to deduct and off set, at any time and from time to time, all or part of any sums owed by Player to Club from any current, future or deferred wages, salaries, bonuses, severance pay, grievance awards and/or additional compensation owed to Player by Club. Such deductions will be made in accordance with Article 4, Section 9 of the CBA, dated August 4, 2011. In the event the full outstanding amount owed to Club cannot be satisfied by authorized deductions from amounts owed to, or coming due to, Player as set forth above, then Club shall retain all available rights and remedies to compel immediate payment.

 

6.                                      No term or condition of this Agreement, and no breach thereof, shall be waived, altered or modified except by written instrument signed by Player and Club.

 

7.                                      Club, in its sole discretion, shall be entitled to purchase a policy of insurance naming Club as beneficiary and insuring Ten Million and No/100 Dollars ($10,000,000.00) of this Signing Bonus, dated as of March 6, 2012, covering the 2012-2014 Contract Years and a portion of the 2015 Contract Year in the event Player is unable to perform the services required by the Contract due to an NFL football-related or non-football related injury or death resulting therefrom, as set forth under the terms and conditions of such policy.

 

To the extent any term set forth above is deemed unenforceable because such term or provision conflicts with the Collective Bargaining Agreement, dated August 4, 2011 or for any other reason, the remainder of the terms shall remain in full force and effect and such unenforceable term shall be reduced to the extent necessary so that the term, as so reduced, are enforceable (including, but not limited to, any provision relating to the repayment by Player to Club of any unearned portion of the Signing Bonus, which shall be reduced to the maximum amount permitted by the terms of this Agreement and the CBA, dated August 4, 2011. The invalidity or unenforceability of any term of this Agreement shall not affect the validity or enforceability of any other provision hereof, which shall remain in full force and effect, and this Agreement shall be construed as if such unenforceable provision had never been contained herein.

 

In witness whereof, Club and Player have executed this Agreement as of the day and year first referenced above.

 

	
CLUB — HOUSTON NFL HOLDINGS, L.P.
    	
PLAYER — ARIAN FOSTER
    
	
By
    	
RCM Sports & Leisure, L.P., its general   partner
    	
 
    
	
By:
    	
Houston NFL Holdings GP, L.L.C., its general   partner
    	
 
    
	
 
    	
 
    
	
/s/ Christian Olsen
    	
 
    	
 
    
	
Christian Olsen
    	
/s/ Arian Foster
    
	
Vice President of Football Administration
    	
 
    
	
 
    	
 
    
	
Date:
    	
3/6/12
    	
 
    	
Date:
    	
3/6/12
    
						

 

 

	
PLAYER INFORMATION
    	
 
    	
 
    	
CLUB:
    	
HOUSTON   TEXAS
    	
 
    	
DATE:
    	
3/6/12
    
	
(PLEASE PRINT)
    	
 
    	
 
    	
 
    	
 
    

 

The following information must be supplied by NFL rookie players and those veterans who have broken service. This sheet must accompany the player contract sent to the League office by the club, at the time of signing.

 

	
NAME:
    	
FOSTER
    	
ARIAN
    	
ISA
    
	
 
    	
(Last)
    	
(First)
    	
(Middle)
    

 

	
HOME   ADDRESS:
    	
                                      
    	
Houston, TX
    	
77056
    
	
 
    	
(Number & Street)
    	
(City & State)
    	
(Zip Code)
    

 

	
PHONE:
    	
                              
    	
 
    	
CELL PHONE:
    	
—
    

 

	
PAGER:
    	
—
    	
 
    	
E-MAIL:
    	
                              
    

 

	
SOC.   SECURITY #:
    	
                         
    	
 
    	
HEIGHT:
    	
6’1”
    	
 
    	
WEIGHT:
    	
230
    

 

	
DATE   OF BIRTH:
    	
8/24/86
    	
 
    	
BIRTH   CITY/STATE:
    	
Albuquerque,   NM
    

 

	
AGENT’S   NAME:
    	
Mike   McCartney
    	
 
    	
AGENT’S   PHONE:
    	
(312)   342-8276
    

 

	
WIFE’S   NAME:
    	
Romina   Foster
    	
NO.   OF CHILDREN:
    	
1
    	
 
    

 

	
Circle   One:
    	
MARRIED
    	
 
    	
HIGH   SCHOOL GRADUATION (Month/Year):
    	
 
    

 

	
HIGH   SCHOOL:
    	
Mission Bay H.S.
    	
 
    	
San Diego, CA
    
	
 
    	
(Name)
    	
 
    	
(City & State)
    

 

	
DATE   FIRST ENROLLED AT ANY COLLEGE OR JR. COLLEGE
    	
Aug   ‘04
    	
 
    	
PLAYING   POSITION:
    	
RB
    
	
 
    	
(Month/Year)
    	
 
    	
 
    

 

	
COLLEGES AND/OR JR. COLLEGES   ATTENDED (If transferred, list all schools in order)
    

 

	
College
    	
 
    	
Start (Month/Year)
    	
 
    	
End (Month/Year)
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
N/A
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    

 

	
COLLEGE   GRADUATE?
    	
NO
    	
IF   EXPECTED TO GRADUATE LIST DATE:
    	
 
    
	
 
    	
(Yes/No)
    	
 
    	
(Month/Year)
    

 

	
YEARS   PLAYED COLLEGE FOOTBALL:
    	
’05 RSF – ’08 SR
    
	
(Indicated red shirt year)
    	
(Example: 96FA-AS, 87 50, 88 87, 89 SA)
    

 

	
PRO EXPERIENCE —   List in order all major, minor, and semi-pro teams you have played with:
    

 

	
TEAM
    	
 
    	
LEAGUE
    	
 
    	
DATES
    
	
HOUSTON TEXANS
    	
 
    	
NFL
    	
 
    	
FALL ’09 — WINTER ‘11
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    

 

	
LIST   ANY RELATIVES WHO PLAY OR COACH IN THE NFL OR HAVE IN THE PAST:
    	
N/A
    

 

I attest that I am not contractually obligated to any other football organization, team or league, I hereby authorize the above named colleges to release to the NFL information pertaining to my matriculation date and dates of attendance.

 

	
PLAYER’S   SIGNATURE: 
    	
/s/   Arian Foster

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