Updated

Nebraska athletic director Tom Osborne says there is nothing inappropriate about his department having a business agreement with the father of the Cornhuskers' starting quarterback.

Casey Martinez of Corona, Calif., owns an apparel company known as Corn Fed. He signed a contract with Nebraska in June 2007 that entitles Nebraska to a 10 percent royalty on Corn Fed products bearing the Huskers' logo. The Los Angeles Times first reported the agreement.

Nebraska offered Martinez's son, Taylor, a football scholarship in June 2008, and he signed his letter of intent in February 2009 without visiting another school.

NCAA spokesman Erik Christianson said the deal is not against the rules.

Osborne said he didn't understand how it could be perceived that the licensing agreement helped Nebraska land Taylor Martinez or be considered an ongoing extra benefit to him.

"The arrangement was done before we even knew about Taylor Martinez or that we knew he was a football player," Osborne told The Associated Press on Thursday from San Diego, where the Huskers were playing in the Holiday Bowl. "This hasn't changed anything. It would be really odd if we said that now that Taylor plays with Nebraska we can no longer do business with you. We're doing nothing that violates NCAA or university rules."

Taylor Martinez won the starting quarterback's job after sitting out as a redshirt in 2009, his first year on campus. The speedy Martinez emerged as one of the nation's top first-year players before injuries began slowing his production in October.

The NCAA earlier this year said the father of Auburn quarterback Cam Newton had tried to peddle his son to Mississippi State for cash, but that the athlete didn't know anything about it. Newton has led his team to the BCS championship game and won the Heisman Trophy.

NCAA rules allow parents of a prospective or current student-athlete to enter a business relationship with a school if no special arrangements are made and the business is legitimate, Christianson wrote in an e-mail to the AP.

"Such arrangements, however, could raise concerns and possible scrutiny," he wrote.

Michael Stephens, the assistant athletic director who handles licensing for Nebraska, said the school has taken in less than $500 over the three-year period of the agreement with Corn Fed.

Casey Martinez said he trademarked the name Corn Fed in 2000 and incorporated in 2004. Martinez had worked in real estate, with the T-shirt business starting out as a family hobby. When the real estate market cooled in 2008, he said, Corn Fed became his primary business.

Why Corn Fed? Casey used to own a high school football magazine, and he said he used the term in a headline about a recruit from Iowa, and it came to mind again when he was starting his T-shirt business.

He had begun seeking licensing agreements with universities in 2006, and Nebraska was the first to sign on. Iowa, Iowa State and Northern Iowa followed. He said Iowa has proved to be the most lucrative but added that college team merchandise represents a "very small percentage" of his business.

"An arrangement that you refer to with University of Nebraska is a strictly a business deal and has never given me any concerns," Martinez wrote in an e-mail to the AP. "I approached them years ago for a licensing opportunity, as I did the other schools, when Taylor was much younger and wasn't even thinking about college football."

Taylor Martinez attended three high schools. In June 2007, he was between his sophomore year at Norco (Calif.) High, where he primarily played as a defensive back. In the fall of 2007, he played quarterback at San Bernadino (Calif.) Cajon High. He went to Corona Centennial High as a senior in 2008 and quarterbacked his team to a perfect season.

Rivals.com rated Martinez as a three-star prospect on a five-star scale, and it was no sure thing that he would even play quarterback at Nebraska when he signed. Martinez, who also played defensive back in high school, was listed as an "athlete" on signing day.

National recruiting analyst Jeremy Crabtree of ESPN.com said Martinez didn't blossom into a big-time college recruit until the summer of 2008, a year after Casey Martinez and Nebraska signed their agreement.

"That's when he first came onto our radar," said Crabtree, formerly of Rivals.com. "He started to build his name through summer camp sessions. I hadn't even heard of him in June 2007."