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Office of Licensing and Trademark – Code of Conduct for CLC Licensees

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• P.O. Box 400854
• Room 270 Bryant Hall
• Charlottesville, VA 22904-4854
• Phone: 434.982.5600
• Fax: 434.982.5024
• Email: licensing@virginia.edu

Code of Conduct for CLC Licensees

I. Introduction: The Collegiate Licensing Company (“CLC”) and the collegiate institutions represented by CLC (“Member Institutions”) are each committed to conducting their business affairs in a socially responsible manner consistent with their respective missions. CLC and the Member Institutions expect nothing less of collegiate licensees. Therefore, CLC licensees will conduct their business in a manner consistent with, and follow workplace standards that adhere to, this Code of Conduct (the “Code”).

II. Notice: The following Code of Conduct shall apply to all CLC Licensees. Throughout this Code the term “licensee” shall include all persons or entities which have entered into a written license agreement with CLC to manufacture products bearing the names, trademarks and/or images of one or more Member Institution. Additionally, this Code shall apply to all of the licensees’ contractors. Throughout this Code the term “contractor” shall include each contractor, subcontractor, vendor, or manufacturer that is engaged in a manufacturing process that results in a finished product for the consumer. “Manufacturing process” shall include assembly and packaging.

As a condition of being permitted to produce and/or sell licensed products bearing the names, trademarks and/or images of the Member Institutions, licensees must comply with this Code and ensure that their contractors comply with this Code. This Code constitutes a requirement for licensees pursuant to Paragraph 24 of the License Agreement. Accordingly, licensees and their contractors are required to adhere to this Code within six (6) months.

III. Remediation: If CLC or any Member Institution(s) determines that any licensee or contractor has failed to comply with this Code, CLC, upon consultation with the licensee, may require that the licensee implement a corrective action plan on terms acceptable to CLC and the applicable Member Institution(s). The remedy will, at a minimum, include immediately taking all necessary steps to correct such violations including, and without limitation, paying all applicable back wages, or any portion of them, found due to workers who manufactured the licensed products. CLC reserves the right to terminate its relationship with any licensee that continues to conduct its business in violation of this Code.

IV. Standards: CLC seeks licensees who take a leadership role on these issues and, to the extent practical, exceeds the standards of this Code. CLC licensees must operate work places and ensure that their contractors operate work places that adhere to the following minimum standards and practices:

1. Legal Compliance: CLC licensees must comply with all applicable legal requirements in conducting business related to, or involving, the production or sale of products or materials bearing the names, trademarks and/or images of the Member Institutions. Where there are any differences or conflicts with this Code and the applicable laws of the country of manufacture, the higher standard will prevail. Whenever there is uncertainty as to which standard is higher, CLC and/or the applicable Member Institution(s) will consult with the licensee to determine which standard will prevail.
2. Employment Standards: Licensees shall comply with the following
   standards:
   1. Wages and Benefits: Licensees recognize that wages are essential to meeting employees’ basic needs. Licensees shall pay employees, as a floor, at least the minimum wage required by local law or the local prevailing industry wage, whichever is higher, and shall provide legally mandated benefits.
   2. Working Hours: Except in extraordinary business circumstances, hourly and/or quota-based wage employees shall (i) not be required to work more than the lesser of (a) 48 hours per week and 12 hours overtime or (b) the limits on regular and overtime hours allowed by the law of the country of manufacture or, where the laws of such country do not limit the hours of work, the regular work week in such country plus 12 hours overtime; and (ii) be entitled to at least one day off in every seven day period.
   3. Overtime Compensation: In addition to their compensation for regular hours of work, hourly and/or quota-based wage employees shall be compensated for overtime hours at such a premium rate as is legally required in the country of manufacture or, in those countries where such laws do now exist, at a rate at least equal to their regular hourly compensation rate.
   4. Child Labor: Licensees shall not employ any person at an age younger than 15 (or 14, where, consistent with International Labor Organization practices for developing countries, the law of the county of manufacture allows such exception). Where the age for completing compulsory education is higher than the standard for the minimum age of employment stated above, the higher age for completing compulsory education shall apply to this section. Licensees agree to consult with governmental, human rights and nongovernmental organizations, and to take reasonable steps as evaluated by CLC, the applicable Member Institution(s) or their designee, and the applicable Licensee(s) to minimize the negative impact on children released from employment as a result of implementation or enforcement of the Code.
   5. Forced Labor: There shall not be any use of forced prison labor, indentured labor, bonded labor or other forced labor.
   6. Health and Safety: Licensees must provide workers with a safe and healthy work environment. If residential facilities are provided to workers, they must be safe and healthy facilities.
   7. Nondiscrimination: Licensees shall employ individuals solely on the basis of the ability to perform the job.
   8. Harassment or Abuse: Every employee shall be treated with dignity and respect. No employee shall be subject to any physical, sexual, psychological or verbal harassment or abuse. Licensees will not use or tolerate any form of corporal punishment.
   9. Freedom of Association: Employers shall recognize and respect the right of employees to freedom of association and collective bargaining.
   10. Legal System: Products and materials bearing the names, trademarks and/or images of the Member Institutions shall not be manufactured or produced in any country where the local legal system would prevent CLC and/or the Member Institutions, in their sole discretion, from adequately protecting their respective names, trademarks and/or images, or other interests, or from implementing any provisions of this Code.
   11. Political, Economic, Social, and Human Rights Environment: Products and materials bearing the names, trademarks and/or images of the Member Institutions shall not be manufactured or produced in any country where the political, social, economic or human rights environment, as determined by CLC and/or the Member Institutions, would prevent the conducting of business in a manner that is consistent with this Code.

V. Compliance and Disclosure: At least sixty (60) days prior to the date of the annual license renewal, licensees shall disclose the following to CLC:

1. the company names, owners and/or officers, addresses, phone numbers, e- mail addresses and nature of the business association for all of the licensees’ contractors and manufacturing plants which are involved in the manufacturing process of items which bear or will bear the names, trademarks and/or images of the Member Institutions;
2. written assurance that licensees and contractors are in compliance with this Code; and
3. a summary of the steps taken, and/or difficulties encountered, during the preceding year in implementing and enforcing this Code.

Note: Licensees shall immediately report to CLC when changes occur that materially affect the application of these standards, such as the selection of a new factory.