[HX89043], Agreement, Edison Phonograph Toy Manufacturing Co, Thomas Alva Edison, July 1st, 1889


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This is a license agreement made on the first day of July 1889, sent from the Edison Phonograph Toy Manufacturing Company to Thomas Edison. ## in consideration of the mutual promises herin made and the sum of one dollar exchanged ## First ## As the Toy Manufacturing Company is the owner of certain patents, it grants the Edison the sole and exclusive right in all parts of the world to manufacture the inventions and improvements, especially the phonographs or speaking mechanisms applicable to dolls, toys, or toy figures and accessories thereto covered by a) several agreements and patens or b) any future agreements which the Toy Manufacturing Co. may make or c) any other inventions or patents which edison has heretofore acquired or may hereafter acquire. ## Second ## Edison agrees to manufacture the phonographic mechanisms etc. under the license above given, to deliver the same to the Toy Manufacturing Co. at the actual cost of manufacture plus twenty percentum thereof, the cost of manufacture to include the cost of labor, material, etc. including 5 percentum of the aggregate cost for the depreciation of the plant. All deliveries shall be F.O.B as regards places of manufacture where the freight can be unloaded directly at the factory, but in other cases an additional charge applies. ## Third ## Within one month of the agreement the Edison will provide the Toy Manufacturing Co. with standard models of the principle articles of phonographic mechanism covered by this agreement, to be prepared at the Toy Manufacturing Co's expense. If the Toy Manufacturing Co does not find them satisfactory, it should be left to arbitration as provided for in the Tenth section hereof. After standard models have been fized, triplicate sets thereof shall be made by Edison at the Toy Manufacturing Co's expense , one of which shall be deposited with each of the parties hereto, and the third set shall remain in the custody of Edison for the purpose of being delivered by him to any person or corporation to whom or which he may hereafter assign the rights to manufacture given by this license as hereinafter provided for in the Eleventh section hereof. Once standards are established they are fixed until changed by mutual consent, in which case the same process is to be followed. If a dispute arises it will be arbitrated according to the tenth section of this document. ## Fourth ## Edison shall always employ the best and most modern machinery and methods, and possess adequate facilities for such manufacture. Arbitration will be handled accoding to the provisions hereinafter provided. Whenever under the provisions of this section or under the provisions of the next proceding third section hereof, Edison shall find it necessary to be required to abandon old tools and machinery, and to procure new tools and machinery, compensation given to Edison shall be limited to loss on tools thus abandoned. ## Fifth ## The extent to which the manufacture of articles covered by this agreement is to be carried on, shall be regulated by the requirements of the Toy Manufacturing Co, with the following restrictions: Within one calendar month from the date of this instrument, or as soon thereafter as standard modesl may have been fixed as provided for in the third section hereof, the Toy Co shall give Edison its firm order for the delivery of five hundred complete toy phonograph mechanisms per diem, the said order to continue in force for a period of not less than three months from the date of the beginning of delivery thereunder, and such delivery to begin not later than one month from the date of such order. ## If the Toy Co wants to increase or decrease its orders, after the expiration of three months, it needs to serve written notice to Edison at least six weeks before the expiration of the said three months and at least six weeks before the date when such increase or diminishment is to take effect; and if they desire to regulate the amount of daily output from there on out they need to provide six weeks' written notice to Edison; and Edison agrees to at any time increase the said dialy output by at least an additional output of five hundred per diem, or to decrease the then output if a decrease be required, upon the expiration of six weeks from the date of the receipt of such written notice. ## Articles are expected to be packed and shipped immediately, and at no point is Edison to be required to carry in storages a greater number of said articles than an accumulation of one week. If articles accumulate Edison has a right to ship them to the Toy Co headquarters in Boston or any other place the Toy Co may indicate, shipments to be made and paid for in the customary manner. ## Sixth ## At the expiration of each calendar month Edison shall present the Toy Co with a bill for articles manufactured and the Toy Co will pay the full amount for the month preceding such payment, payment to be based on articles actually shipped, including those shipped under the last clause of the fifth section, and if payments are not promptly made Edison will discontinue manufacture. Edison has the right to examine the books and office records of the Toy Co for the purpose of verifying the afosaid statements. ## Seventh ## All manufacturing herein provided for shall for the present be carried on in the US, for both domestic and export manufacturing, but Edison reserves the right to carry on the said manufacturing in other countries as from time to time he deems desirable, complying with the laws of all countries in which the manufacturing takes place. As regards any countries whose laws make it necessary to carry on therein the manufacture of the articles herein referred to, Edison agrees to establish factories in all such countries sufficient to supply the trade therein in such substantial manner as is provided for by this agreement, and in case of any dispute on this point, it shall be left to arbitration. If Edison can't estalbish factories in these countries in a timely manner then thee Toy Co has the right to establish factories in these countries itself or to license others to do so, but the product of such factories shall not be exported beyond the boundaries of the countries in question. ## Except as provided for in the eleventh section hereof, Edison will not license or authorize any other party to manufacture any of the articles herein provided for, since it is the intention of this instrument to reserve this exclusive license for Edison himself. ## Eighth ## Should the Toy Co find it desirable to complete at the factory or factories of Edison, its phonographic dolls, by attaching to the phonographic mechanisms and accessories herein provided for, the other parts of the said dolls, that is to say, the hands, arms and legs, Edison will at the request of the Toy Co, provide proper rooms, facilities and labor therfor, charging proper sums to be arbitrated as hereinafter provided for in case of disagreeement, but charges are not to be considered as a a part of the cost of manufacturer's prices of phonographic mechanism and articles as provided for in the second section hereof. ## Ninth ## The Toy Co agrees to provide Edison with further grants and licenses upon request which are reasonably necessary to carry out this agreement. ## Tenth ## In case of any disagreement the parties go to arbitration. Each party selects an arbitrator, when then jointly select a third, the decision of a majority of arbitrators to be final and binding. Arbitrators are to be chosen for their expertise in the technical matters at stake. ## Eleventh ## This license or any of the rights connected herewith may be assigned by Edison at will to any corporation or corporations in which he owns at the time of such assignment at least a majority of the capital stock, and such assignmentor assignments shall continue for the length of time provided for therein unless Edison ceases to be majority stockholder, in which case, if Edison is still alive, the Toy Co has the option of terminating the assignment within six months written notice thereof. All such assignments are subject to the terms of this agreement. ## Twelfth ## This agreement shall continue in force during the life of all grants, licenses and patents relating to phonographic toys, unless terminated as herein provided for. In Witness Whereof, signed and sealed, etc.








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[HX89043], Agreement, Edison Phonograph Toy Manufacturing Co, Thomas Alva Edison, July 1st, 1889

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Thomas A. Edison Papers, School of Arts and Sciences, Rutgers University


July 1, 1889