{"id":42219,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/design-services-agreement-polo-ralph-lauren-enterprises-lp-and2.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"design-services-agreement-polo-ralph-lauren-enterprises-lp-and2","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/operations\/design-services-agreement-polo-ralph-lauren-enterprises-lp-and2.html","title":{"rendered":"Design Services Agreement &#8211; Polo Ralph Lauren Enterprises LP and Polo Ralph Lauren Japan Co. Ltd."},"content":{"rendered":"<pre>\n                                                           (Polo Japan - Design)\n\n\n\n                  DESIGN SERVICES AGREEMENT dated as of March 1, 1998 by and\nbetween Polo Ralph Lauren Enterprises, L.P. (the 'Design Partnership'), with a\nplace of business at 650 Madison Avenue, New York, New York 10022 and Polo Ralph\nLauren Japan Co., Ltd. (the 'Company') with a place of business at Kihoh Bldg.\n2-2, Koji-Machi, Chiyoda-ku, Tokyo, 102 Japan.\n\n                  Ralph Lauren ('Lauren') is an internationally famous designer\nwho has been twice inducted into the Coty Hall of Fame for his design of men's\nand women's fashions, is the recipient of the CFDA Lifetime Achievement Award,\nand is a creator of original designs for cosmetics, jewelry, home furnishings\nand other products.\n\n                  The Polo\/Lauren Company, L.P., a New York limited partnership\n('PLC'), holds the right and interest in and to certain trademarks and trade\nnames, as same may be used in connection with the manufacture and sale of\nLicensed Products, as hereinafter defined, and on even date herewith, the\nCompany has obtained the right to use the trademarks ('Trademarks') in\nconnection with the Licensed Products, pursuant to a license agreement ('License\nAgreement') of even date herewith by and between the Company and PLC.\n\n                  The value of the Trademarks are largely derived from the\nreputation, skill and design talents of Lauren, and Lauren, directly and through\nhis designees, provides design services through the Design Partnership.\n\n                  The Company desires to obtain the services of the Design\nPartnership in connection with the creation and design of the Licensed Products.\n\n                  The Company desires, in order to exploit the rights granted to\nit under the License Agreement, to engage and retain the Design Partnership to\ncreate and provide to the Company the designs for its line of Licensed Products.\nThe Design Partnership is willing to furnish such designs and render such\nservices on the basis hereinafter set forth. As used herein, the term 'Licensed\nProducts' shall have the meaning set forth in the License Agreement.\n\n                  In consideration of the foregoing premises and of the mutual\npromises and covenants herein contained, the parties hereto, intending to be\nlegally bound, hereby agree as follows:\n\n                  1. Designs: Assistance.\n\n                           1.1 At any time or from time to time the Company may\nprovide the Design Partnership with a list or lists setting forth those Licensed\nProducts for which the Company shall require designing.\n\n                           1.2 At any time or from time to time, or within a\nreasonable period following receipt by the Design Partnership of the aforesaid\nlist or lists, the Design Partnership shall provide the Company with a program\nof suggested, broad design themes and concepts with respect to the design of the\nLicensed Products ('Design Concepts') which shall be embodied in verbal and\/or\nwritten descriptions of design themes and concepts and such other detailed\ndesigns and sketches therefor, as the Design Partnership deems appropriate. The\nDesign Partnership shall have full discretion with respect to the manner in\nwhich the Design Concepts shall be formulated and presented by the Design\nPartnership to the Company. The Company and the Design Partnership shall confer\non Design Concepts and shall make such modifications as are required to meet the\nDesign Partnership's approval.\n\n                           1.3 The Design Partnership may engage such employees,\nagents, and consultants operating under the Design Partnership's creative\nsupervision and control as it may deem necessary and appropriate.\n\n                           1.4 From time to time while this Agreement is in\neffect, the Design Partnership, by notice to the Company, may (a) develop or\nmodify and implement designs from the Design Concepts or other designs furnished\nby the Design Partnership or (b) develop and implement new designs.\n\n                           1.5 If the Company wishes to prepare a design for any\nor all of its lines of Licensed Products, it shall submit to the Design\nPartnership for its approval the Company's proposed design therefor. By written\nnotice to the Company, the Design Partnership may approve any of the designs so\nfurnished, with such modifications as it shall deem appropriate, or the Design\nPartnership, in its sole discretion, may disapprove any or all of the designs.\n\n                           1.6 The Company understands that all or portions of\nthe Design Concepts may be furnished to the Company through or in cooperation\nwith other entities to which the Design Partnership has provided design\nservices. The Company upon its prior authorization and receipt of appropriate\ndocumentation, shall pay all costs, including shipping and handling charges, for\nfabric swatches or mill chips, sketches, specifications, paper sample patterns\nand product samples furnished to the Company by the Design Partnership or such\nother entities.\n\n                           1.7 The Company shall submit to the Design\nPartnership for its review and approval, the Company's proposed media\nadvertising (other than cooperative advertising) relating to each Licensed\nProduct or Licensed Product line.\n\n\n                                        2\n\nAll layouts proposed by the Company for cooperative advertising shall similarly\nbe subject to the Design Partnership's review and approval, which shall not be\nunreasonably withheld or delayed. The Design Partnership may, with respect to\nsuch advertising make such suggestions as it may deem necessary or appropriate,\nor disapprove, in either event by notice to the Company.\n\n                           1.8 All patents and copyrights on designs of the\nLicensed Products shall be owned exclusively, and applied for, by the Design\nPartnership or its designee, at the Design Partnership's discretion and expense\nand shall designate the Design Partnership or its designee as the patent or\ncopyright owner, as the case may be, therefor.\n\n                           1.9 The Company acknowledges that the Licensed\nProducts contain elements which in concept, execution and\/or presentation are\nunique. The Company agrees that it will not, during the term of the Agreement,\nuse any designs used in the Licensed Products or any designs submitted or\nmodified by the Design Partnership or any designs which are comparable and\/or\ncompetitive with Licensed Products and which may be identified as the Design\nPartnership designs for purposes other than those permitted by this Agreement or\nthe License Agreement.\n\n                  2. Design Legends; Copyright Notice and License.\n\n                           2.1 All designs, patterns, sketches, artwork, logos\nand other materials of Licensed Products and the use of such designs, artwork,\nsketches, logos and other materials created by the Design Partnership, or\ncreated by or for the Company and reviewed and approved by the Design\nPartnership, or developed by or for the Company from Design Concepts or\nsubsequent design concepts furnished or approved by the Design Partnership (all\nof which shall hereinafter constitute Design Concepts), shall be the property of\nthe Design Partnership and shall be subject to the provisions of this paragraph\n2.\n\n                           2.2 All right, title and interest in and to the\nsamples, sketches, design, artwork, logos and other materials furnished by or to\nthe Company or submitted to the Design Partnership, whether created by the\nDesign Partnership or the Company, are hereby assigned to and shall be the sole\nproperty of the Design Partnership. The Company shall cause to be placed on all\nLicensed Products appropriate notice designating the Design Partnership as the\ncopyright or design patent owner thereof, as the case may be. The manner of\npresentation of said notices shall be reviewed and approved by the Design\nPartnership prior to use thereof by the Company.\n\n                           2.3 The Design Partnership hereby grants to the\nCompany the exclusive right, license and privilege ('License') to use the\ndesigns furnished hereunder and all copyrights, if any, and patents, if any\ntherein; provided, however, that the License is limited to use in connection\nwith Licensed Products manufactured and sold, or imported and sold, pursuant to\nthe License Agreement and only for the\n\n\n                                        3\n\nseasonal collection for which such Design Concepts are approved. All other\nrights in and to the designs furnished hereunder, including without limitation\nall rights to use such designs in connection with products other than Licensed\nProducts (as defined in the License Agreement) and in territories other than the\nTerritory (as defined in the License Agreement) are expressly reserved by the\nDesign Partnership. The License shall continue only for such period as this\nAgreement shall be effective. The Design Partnership shall execute and deliver\nto the Company all documents and instruments necessary to perfect or evidence\nthe License. Upon termination of this Agreement, for any reason whatsoever, any\nand all of the Company's right, title and interest in and to the License shall\nforthwith and without further act or instrument be assigned to, revert to and be\nthe sole and exclusive property of the Design Partnership, and the Company shall\nhave no further or continuing right or interest therein, except the limited\nright to complete the manufacture of and sell Licensed Products during the\ndisposal period, as set forth in paragraph 6.3 hereof. In addition, the Company\nshall thereupon (i) execute and deliver to the Design Partnership all documents\nand instruments necessary to perfect or evidence such reversion, (ii) refrain\nfrom further use of any of the Design Concepts and (iii) refrain from\nmanufacturing, selling or distributing any products (whether or not they bear\nthe Trademarks) which are confusingly similar to or derived from the Licensed\nProducts or Design Concepts.\n\n                           2.4 The Company may sublicense its rights hereunder\nonly in connection with a sublicense of its rights under the License Agreement\nwhich has been approved pursuant to the License Agreement. The Design\nPartnership acknowledges and agrees that the Company's parent Company, The Seibu\nDepartment Stores, Ltd., will be involved, as the Company's sublicensee, service\nprovider or otherwise, in the Polo\/Ralph Lauren business in the Territory (as\ndefined in the License Agreement) using the Design Concepts in accordance with\nthe terms and conditions of this Agreement.\n\n                           2.5 The Design Partnership represents and warrants to\nthe Company that it has full right, power and authority to enter into this\nAgreement, to perform all of its obligations hereunder and to consummate all of\nthe transactions contemplated herein.\n\n                           2.6 The Company represents and warrants to the Design\nPartnership that the Company has full right, power and authority to enter into\nthis Agreement, to perform all of its obligations hereunder and to consummate\nall the transactions contemplated herein.\n\n                  3. Licensed Products.\n\n                           3.1 The Company shall obtain the written approval of\nthe Design Partnership, of all Licensed Products to be manufactured or caused to\nbe manufactured by the Company, by submitting a Prototype, as hereinafter\ndefined, of each different design or model of a Licensed Product, including, but\nnot limited to,\n\n\n\n                                        4\n\nthe type and quality of materials, colors and workmanship to be used in\nconnection therewith, prior to any commercial production thereof. In the event\nthat the Design Partnership rejects a particular Prototype or Prototypes, the\nDesign Partnership shall so notify the Company and shall in certain cases where\nthe Design Partnership desires to include the prototype in the collection,\nprovide the Company with suggestions for modifying the particular Prototype or\nPrototypes which the Design Partnership is rejecting. The Company shall promptly\ncorrect said Prototype or Prototypes, resubmit said Prototype or Prototypes to\nthe Design Partnership and seek the Design Partnership's approval under the same\nterms and conditions as set forth herein with respect to the first submission of\nPrototypes. As used herein, the term 'Prototype' shall mean any and all models,\nor actual samples, of Licensed Products; and the term 'Final Prototype' shall\nmean the actual final sample of a Licensed Product from which the first\ncommercial production thereof will be made and which has been approved by the\nDesign Partnership prior to the first commercial production thereof pursuant to\nthis paragraph 3.\n\n                           3.2 The written approval of the Design Partnership of\nthe Prototypes for each seasonal collection shall be evidenced by a written\nlist, signed on behalf of the Design Partnership, setting forth those Prototypes\nwhich have been approved for inclusion in such collection. Prototypes so\napproved shall be deemed Final Prototypes in respect of such collection.\nApproval of any and all Prototypes as Final Prototypes shall be in the sole\ndiscretion of the Design Partnership, individually, or a designee of the Design\nPartnership. The Company shall present for sale, through the showing of each\nseasonal collection to the trade, all Final Prototypes so approved in respect of\nsuch collection.\n\n                           3.3 The Licensed Products thereafter manufactured and\nsold by the Company shall strictly adhere, in all respects, including, without\nlimitation, with respect to materials, color, workmanship, designs, dimensions,\nstyling, detail and quality, to the Final Prototypes approved by the Design\nPartnership.\n\n                           3.4 In the event that any Licensed Product is, in the\njudgment of the Design Partnership, not being manufactured or sold in strict\nadherence to the materials, color, workmanship, designs, dimensions, styling\ndetail and quality, embodied in the Final Prototypes, or is otherwise not in\naccordance with the Final Prototypes, the Design Partnership shall notify the\nCompany thereof in writing and the Company shall promptly repair or change such\nLicensed Product to conform strictly thereto. If an item of Licensed Product as\nrepaired or changed does not strictly conform to the Final Prototypes and such\nstrict conformity cannot be obtained after at least one (1) resubmission, the\nTrademarks shall be promptly removed from the item, at the option of the Design\nPartnership, in which event the item may be sold by the Company, provided it is\nin no way identified as a Licensed Product. Notwithstanding anything in this\nparagraph 3.4 to the contrary, sales of all products using the Design Concepts,\nwhether or not bearing the Trademarks, shall be subject to compensation payments\npursuant to paragraph 4 hereof.\n\n\n\n                                        5\n\n                           3.5 The Design Partnership and its duly authorized\nrepresentative shall have the right, upon reasonable notice during normal\nbusiness hours, to inspect all facilities utilized by the Company (and, upon\nprior consultation with the Company, its contractors and suppliers) in\nconnection with the preparation of Prototypes and the manufacture, sale, storage\nor distribution of Licensed Products pursuant hereto and to examine Licensed\nProducts in process of manufacture and when offered for sale within the\nCompany's operations. The Company shall take all necessary steps, and all steps\nreasonably requested by the Design Partnership, to prevent or avoid any misuse\nof the licensed designs by any of its customers, contractors or other resources.\n\n                           3.6 The Company shall upon request make its\npersonnel, and shall use its best efforts to make the personnel of any of its\ncontractors, suppliers and other resources, available by appointment during\nnormal business hours for consultation with the Design Partnership. The Company\nshall make available to the Design Partnership, upon reasonable notice,\nmarketing plans, reports and information which the Company may have with respect\nto Licensed Products in the Territory (as defined in the License Agreement).\n\n                           3.7 The Company may employ subcontractors for the\nmanufacture of Licensed Products, solely on the terms set forth in paragraph\n16.4 of the License Agreement.\n\n                           3.8 The Company shall include within each seasonal\ncollection of Licensed Products a fully representative assortment of designs\ntherefor designated by the Design Partnership for inclusion therein.\nNotwithstanding anything to the contrary contained herein or in the License\nAgreement, in the event the Company chooses not to or is unable to include\nwithin a seasonal collection of Licensed Products a particular Licensed Product\nwhich the Design Partnership has designed or designated for inclusion in such\ncollection, the Design Partnership shall be entitled to authorize third parties\nto manufacture such Licensed Product(s) on behalf of the Company and the Company\nshall, at the Design Partnership's option, display, present and sell such\nLicensed Product(s) in its showroom for Licensed Products.\n\n                  4. Compensation; Accounting.\n\n                           4.1 (a) As compensation for the designs and services\nrendered hereunder, the Company shall pay minimum compensation to the Design\nPartnership each year during the term of this Agreement.\n\n\n                                        6\n\n                                    (b) the Initial Term hereof (as defined in\nparagraph 8 of the License Agreement) shall be the following amounts, fixed in\nU.S. dollars:\n\n\n\n                                                    \n                       Year 1                          [***]\n                       Year 2                          [***]\n                       Year 3                          [***]\n                       Year 4                          [***]\n                       Year 5                          [***]\n\n\n                                    (c) The minimum compensation for each year\nduring the 'First Renewal Period' (as defined in paragraph 8 of the License\nAgreement) shall be as follows, in [***] yen:\n\n\n\n                                                    \n                       Year 6                          [***]\n                       Year 7                          [***]\n                       Year 8                          [***]\n                       Year 9                          [***]\n                       Year 10                         [***]\n\n\n                                    (d) The minimum compensation for each year\nduring the 'Second Renewal Period' (as defined in paragraph 8 of the License\nAgreement) shall be as follows, in [***] yen:\n\n\n\n                                                    \n                       Year 11                         [***]\n                       Year 12                         [***]\n                       Year 13                         [***]\n                       Year 14                         [***]\n                       Year 15                         [***]\n\n\n\n                                    (e) The exchange rates fixed by Licensor and\nLicensee with respect to minimum royalty payments during each of the First\nRenewal Period and the Second Renewal Period, in accordance with the terms of\nparagraph 6.1(e) of the License Agreement, shall apply to the minimum\ncompensation payments to be made by the Company hereunder during each of the\nFirst Renewal Period and the Second Renewal Period.\n\n                                    (f) Minimum compensation for each year shall\nbe paid in twelve (12) equal monthly installments on the last day of each month\nduring the term hereof, commencing with the first payment in the amount of\n[***] on March 31, 1998. No credit shall be permitted against minimum \ncompensation payable in any year on account of earned or minimum compensation\npaid in any other year, and minimum compensation shall not be returnable. For\nthe purposes of this\n\n\n\n                                        7\n\nAgreement, the term 'year' shall mean a period of twelve (12) months commencing\non each March 1 during the term of this Agreement.\n\n                           4.2 The Company shall pay to the Design Partnership\nearned compensation based on the net sales price of Licensed Products\nmanufactured or imported and sold by the Company hereunder. Earned compensation\nshall be an amount equal to the 'Earned Compensation Percentage Rate' (as\ndefined in Schedule A hereto) applied to the net sales price of all Licensed\nProducts sold under this Agreement, including, without limitation, sales made\npursuant to paragraphs 3.4 and 6.3 hereof. The Company shall prepare or cause to\nbe prepared statements of operations for the period commencing on the date\nhereof and ending on August 31, 1998 and for each six-month period ending the\nlast day of August and February in each year hereof, which shall be furnished to\nthe Design Partnership together with payment of the earned compensation due, if\nany, for each such six-month period (less minimum compensation due for such\nyear) no later than October 31 (for each period ending on the last day of\nAugust) and April 30 (for each period ending on the last day of February). The\nterm 'net sales price' shall mean the gross sales price of all Licensed Products\nsold under this Agreement to retailers or, with respect to Licensed Products\nthat are not sold directly or indirectly to retailers, other ultimate consumers\n(as in the case of accommodation sales by Company to its employees or sales by\nCompany in its own stores), less trade discounts, merchandise returns and sales\ntax. No other deductions shall be taken. Any merchandise returns shall be\ncredited in the three (3) month period in which the returns are actually made.\nFor purposes of this Agreement, affiliates of the Company shall mean all persons\nand business entities, whether corporations, partnerships, joint ventures or\notherwise, which now or hereafter control, or are owned or controlled, directly\nor indirectly by the Company, or are under common control with the Company. It\nis the intention of the parties that compensation payments will be based on bona\nfide wholesale prices at which the Company sells Licensed Products to\nindependent retailers in arms' length transactions. In the event the Company\nshall sell Licensed Products to its affiliates, compensation payments shall be\ncalculated on the basis of such a bona fide wholesale price irrespective of the\nCompany's internal accounting treatment of such sale. The Company shall identify\nseparately in the statements of operations provided to the Design Partnership\npursuant to paragraph 4.5 hereof, all sales to its affiliates. Notwithstanding\nanything to the contrary contained herein, and except as Licensor and Licensee\nmay otherwise agree with respect to particular items of Licensed Products, no\nearned compensation shall be due hereunder with respect to sales of Licensed\nProducts which Licensee has acquired from other licensees of Licensor, unless\nLicensee acquires such products at a price which is equal to or less than\n[***] percent [***] off the regular wholesale price therefor, or the factory \ncost thereof plus [***] percent [***].\n\n                           4.3 The Company shall reimburse PLC and the Design\nPartnership for all of their travel expenses incurred in the performance of\ntheir respective duties under this Agreement, such amounts to include first\nclass travel and\n\n\n\n                                        8\n\nhotel accommodations, up to a maximum amount of $70,000 per year in the\naggregate. Such amounts payable to the Design Partnership pursuant to this\nparagraph shall become due and payable monthly within thirty (30) days of the\ndate of mailing of the invoices, accompanied by corresponding receipts, for such\ncosts incurred during the preceding month.\n\n                           4.4 If the payment of any installment of compensation\nis delayed for any reason, interest shall accrue on the unpaid principal amount\nof such installment from and after the date on which the same became due\npursuant to paragraphs 4.1 or 4.2 hereof at the prime rate of interest in effect\nfrom time to time at Chase Manhattan Bank, New York, New York or its successor\nbank.\n\n                           4.5 The Company shall at all times keep an accurate\naccount of all operations within the scope of this Agreement and shall render a\nfull statement of such operations in writing to the Design Partnership in\naccordance with paragraph 4.2 hereof. Such statements shall account separately\nfor each different product category and shall include all aggregate gross sales,\ntrade discounts, merchandise returns, sales of miscuts and damaged merchandise\nand net sales price of all sales for the preceding six (6) month period. Such\nstatements shall be in sufficient detail to be audited from the books of the\nCompany. Once annually, which may be in connection with the regular annual audit\nof the Company's books, the Company shall furnish an annual statement of the\naggregate gross sales, trade and prompt payment discounts, merchandise returns\nand net sales price of all Licensed Products made or sold by the Company,\ncertified by Company's chief financial officer or, if the Company's records are\nexamined by an independent accountant, by such independent accountant. Each\nsix-month financial statement furnished by Company shall be certified by the\nchief financial officer of the Company. The Design Partnership and its duly\nauthorized representatives, on reasonable notice, shall have the right, no more\nthan once in each year during regular business hours, for the duration of the\nterm of this Agreement and for one (1) year after the expiration of the disposal\nperiod set forth in paragraph 10.2 of the License Agreement, to examine the\nbooks of account and records and all other documents, materials and inventory in\nthe possession or under the control of the Company and its successors with\nrespect to the information required to be provided under paragraph 4.2 hereof\nand this paragraph 4.5. All such books of account, records and documents shall\nbe maintained and kept available by the Company for at least the duration of\nthis Agreement and for three (3) years thereafter. The Design Partnership shall\nhave free and full access thereto in the manner set above and shall have the\nright to make copies and\/or extracts therefrom. If as a result of any\nexamination of the Company's books and records it is shown that the Company's\npayments to the Design Partnership hereunder with respect to any twelve (12)\nmonth period were less than or greater than the amount which should have been\npaid to the Design Partnership by an amount equal to two percent (2%) of the\namount which should have been paid during such twelve (12) month period, the\nCompany will, in addition to reimbursement of any underpayment, with interest\nfrom the date on which\n\n\n                                        9\n\neach payment was due at the rate set forth in paragraph 4.4 hereof, promptly\nreimburse the Design Partnership for the cost of such examination.\n\n                           4.6 The obligation of the Company to pay compensation\nhereunder shall be absolute notwithstanding any claim which the Company may\nassert against PLC or the Design Partnership. The Company shall not have the\nright to set-off, compensate or make any deduction from such compensation\npayments for any reason whatsoever.\n\n                           4.7 All references to dollars in this Agreement\nshall, except as otherwise expressly provided herein, mean U.S. dollars. All\ncompensation due hereunder shall be paid in U.S. dollars. The currency\nconversion to U.S. dollars for each six-month accounting period shall be made:\n(i) with respect to earned compensation on net sales of Licensed Products up to\nthe 'Trigger Point' (as defined in Schedule A hereto), at the 'Fixed Exchange\nRate' (as hereinafter defined), and (ii) with respect to earned compensation on\nnet sales of Licensed Products in excess of the Trigger Point, at the spot\nconversion rate published by The Bank of Tokyo-Mitsubishi for the day on which\nthe accounting statement and payment is due pursuant to paragraph 4.2 hereof.\nThe term 'Fixed Exchange Rate' shall have the meaning set forth in paragraph 6.5\nof the License Agreement. The amount of compensation to be paid to the Design\nPartnership by the Company hereunder has been determined on the understanding\nthat the Company will be entitled to deduct any required withholding taxes and\nthe Design Partnership will be entitled to a tax credit for United States\nfederal income tax purposes equal to the amount of any tax imposed in Japan upon\nthe Design Partnership's compensation, whether imposed by withholding or\notherwise. The Company shall provide the Design Partnership with all information\nand documentation necessary in order for the Design Partnership to secure such\ntax credits. In the event that any such Japan tax is not so available as a\ncredit for United States federal income tax purposes for the period when paid,\nthe compensation to be paid hereunder shall be renegotiated to reflect the\nactual loss of revenue to Licensor.\n\n                  5. Death or Incapacity of Lauren.\n\n                  The Design Partnership shall perform its obligations hereunder\nnotwithstanding any death or incapacity of Lauren, and the Company shall accept\nthe services of the Design Partnership.\n\n                  6. Term and Termination.\n\n                           6.1 Unless sooner terminated in accordance with the\nterms and provisions hereof, this Agreement shall continue in effect for so long\nas the License Agreement is in effect and shall terminate upon the termination\nof the License Agreement.\n\n\n                                       10\n\n                           6.2 Each of the following shall constitute an event\nof default ('Event of Default') hereunder: (i) any compensation is not paid when\ndue and such default continues for more than fifteen (15) days after notice\nthereof; (ii) the Company shall, after thirty (30) days' written notice from the\nDesign Partnership, continue to use the designs in an unauthorized or improper\nmanner and\/or Company shall make an unauthorized disclosure of confidential\ninformation or materials given or loaned to Company by the Design Partnership or\nPLC which, unless it relates to designs or business plans for upcoming seasons,\nis expressly designated by the Design Partnership or PLC as confidential when so\ngiven or loaned; or (iii) the Company defaults in performing any of the other\nterms of this Agreement and continues in such default for a period of thirty\n(30) days after notice thereof (unless the default cannot be cured within such\nthirty (30) day period and the Company shall have commenced to cure the default\nand proceeds diligently thereafter to cure within an additional fifteen (15) day\nperiod); (iv) an event of default shall occur under the License Agreement or any\nother design agreement entered into between the Company and the Design\nPartnership or license agreement between the Company and PLC; or (v) the License\nAgreement shall be terminated for any reason whatsoever. If any Event of Default\nother than that described in paragraph 6.2(v) shall occur, the Design\nPartnership shall have the right, exercisable in its sole discretion, to\nterminate this Agreement upon ten (10) days' written notice to the Company of\nits intention to do so. Upon the expiration of such ten (10) day period, this\nAgreement shall terminate and come to an end and, subject to paragraph 6.3\nhereof, all rights of the Company in and to the designs furnished or used\nhereunder and all copyrights and designs patents therein and their contemplated\nuse shall terminate. If the Event of Default described in paragraph 6.2(v) shall\noccur, this Agreement and the License shall thereupon forthwith terminate and\ncome to an end without any need for notice to the Company. Termination of this\nAgreement shall be without prejudice to any remedy of the Design Partnership for\nthe recovery of any monies then due to it under this Agreement or in respect to\nany antecedent breach of this Agreement, and without prejudice to any other\nright of the Design Partnership, including without limitation, damages for\nbreach to the extent that the same may be recoverable.\n\n                           6.3 In the event PLC chooses not to exercise the\noption referred to in paragraph 10.1 of the License Agreement with respect to\nall or any portion of the Licensed Products (as therein defined), the Company\nmay dispose of Licensed Products to the extent permitted by and in the manner\nset forth in paragraph 10.2 of the License Agreement. Such sales shall be\nsubject to the payment of earned compensation pursuant to paragraph 4.2 hereof.\nUpon the conclusion of the disposal period all rights and interests in and to\nthe designs furnished or used hereunder and design patents therein and all\ncopyrights licensed hereby shall belong to and be the property of the Design\nPartnership, and the Company shall have no further or continuing right or\ninterest therein.\n\n                           6.4 The Company acknowledges and admits that there\nwould be no adequate remedy at law for its failure to cease the manufacture or\nsale of\n\n\n                                       11\n\nLicensed Products at the termination of this Agreement, by expiration or\notherwise, and the Company agrees that, notwithstanding anything to the contrary\ncontained in paragraph 9.8 hereof, in the event of such failure, the Design\nPartnership shall be entitled to relief by way of temporary or permanent\ninjunction and such other and further relief as any court with jurisdiction may\ndeem proper.\n\n                           6.5 It is expressly understood that under no\ncircumstances shall the Company be entitled, directly or indirectly, to any form\nof compensation or indemnity from the Design Partnership, PLC or their\naffiliates as a consequence to the termination of this Agreement, whether as a\nresult of the passage of time, or as the result of any other cause of\ntermination referred to in this Agreement. Without limiting the generality of\nthe foregoing, by its execution of the present Agreement, the Company hereby\nwaives any claim which it has or which it may have in the future against the\nDesign Partnership, PLC, Lauren, Polo Ralph Lauren Corporation or their\naffiliates, arising from any alleged goodwill created by the Company for the\nbenefit of any or all of the said parties or from the alleged creation or\nincrease of a market for Licensed Products. The Company does not hereby waive\nany claim which might arise against the Design Partnership for damages as a\nresult of any breach of this Agreement by the Design Partnership.\n\n                           6.6 The Company shall have the right to terminate\nthis Agreement upon one hundred and twenty (120) days' written notice in the\nevent that pursuant to paragraph 9.8 hereof and paragraph 16.7 of the License\nAgreement it is determined that the Design Partnership has defaulted in\nperforming any of the terms of this Agreement which default has had a material\nadverse effect on the Company's ability to exploit its rights hereunder, and\nthat the Design Partnership has continued in default for a period of thirty (30)\ndays after notice thereof (unless the default cannot be cured within such thirty\n(30) day period and the Design Partnership shall have commenced to cure the\ndefault and proceeds diligently to cure within an additional fifteen (15) day\nperiod).\n\n                  7. Indemnity.\n\n                           7.1 The Company shall indemnify and save and hold the\nDesign Partnership, PLC, Polo Ralph Lauren Corporation and Lauren, individually,\nand their directors, officers, servants, agents and employees harmless from and\nagainst any and all liability, claims, causes of action, suits, damages and\nexpenses (including reasonable attorney's fees and expenses in actions involving\nthird parties or between the parties hereto), which they, or any of them, are or\nbecome liable for, or may incur, or be compelled to pay by reason of any acts,\nwhether of omission or commission, that may be committed or suffered by the\nCompany or any of its directors, officers, servants, agents or employees in\nconnection with the Company's performance of this Agreement, in connection with\nLicensed Products manufactured by or on behalf of the Company or otherwise in\nconnection with the Company's business; provided, however, that the Company\nshall not be responsible for any\n\n\n\n                                       12\n\nliability, claims, causes of action, suits, damages or expenses incurred or\nsuffered by the Design Partnership, PLC, Polo Ralph Lauren Corporation or\nLauren, individually, or their directors, officers, servants, agents and\nemployees in connection with any suit or proceeding for infringement of\nanother's design patent, trademark, copyright or other proprietary rights\nbrought against them as a result of the Company's use of the Trademarks, or the\nDesign Concepts furnished by the Design Partnership hereunder, in strict\naccordance with the terms and conditions of this Agreement and the License\nAgreement.\n\n                  8. Disclosure.\n\n                  The Design Partnership and the Company, and their affiliates,\nemployees, attorneys, bankers and accountants, shall hold in confidence and not\nuse or disclose, except as permitted by this Agreement, (i) confidential\ninformation of the other or (ii) the terms of this Agreement, except upon\nconsent of the other or pursuant to, or as may be required by law, or in\nconnection with regulatory or administrative proceedings and only then with\nreasonable advance notice of such disclosure to the other. The Company shall\ntake all reasonable precautions to protect the secrecy of the materials,\nsamples, sketches designs artwork logos and other materials used pursuant to\nthis Agreement prior to the commercial distribution or the showing of samples\nfor sale and shall not sell any merchandise employing or adapted from any of\nsaid designs, sketches, artwork, logos, and other materials or their use except\nunder the Trademarks.\n\n                  9. Miscellaneous.\n\n                           9.1 All notices, requests, consents and other\ncommunications hereunder shall be in writing and shall be deemed to have been\nproperly given or sent (i) on the date when such notice, request, consent or\ncommunication is personally delivered, or (ii) five (5) days after the same was\nsent, if sent by certified or registered mail or (iii) two (2) days after the\nsame was sent, if sent by overnight courier delivery or confirmed telecopier, as\nfollows:\n\n                           (a)      if to the Company, addressed as follows:\n\n                                    Polo Ralph Lauren Japan Co., Ltd.\n                                    Kihoh Bldg. 2-2, Koji-Machi\n                                    Chiyoda-ku\n                                    Tokyo, 102 Japan\n                                    Attention: President\n                                    Telecopier: 81.3.3222.0266\n\n\n\n                                       13\n\n                                    With a copy to:\n\n                                    The Seibu Department Stores, Ltd.\n                                    16-15 Minaini-ikebukuro 1-chome\n                                    Toshima-ku, Tokyo 171 Japan\n                                    Attention: Manager of International Division\n                                    Telecopier: 81.3.5396.5285\n\n                           (b)      if to the Design Partnership, addressed as\n                                    follows:\n\n                                    Polo Ralph Lauren Enterprises, L.P.\n                                    650 Madison Avenue\n                                    New York, New York 10022\n                                    Attention: President\n                                    Telecopier: 212-318-7186\n\n                                    with a copy to:\n\n                                    Victor Cohen, Esq.\n                                    Eighth Floor\n                                    650 Madison Avenue\n                                    New York, New York 10022\n                                    Telecopier: 212-318-7183\n\nAnyone entitled to notice hereunder may change the address to which notices or\nother communications are to be sent to it by notice given in the manner\ncontemplated hereby.\n\n                           9.2 Nothing herein contained shall be construed to\nplace the parties in the relationship of partners or joint venturers, and\nneither the Design Partnership nor the Company shall have any power to obligate\nor bind the other in any manner whatsoever, except as otherwise provided for\nherein.\n\n                           9.3 None of the terms hereof can be waived or\nmodified except by an express agreement in writing signed by the party to be\ncharged. The failure of any party hereto to enforce, or the delay by any party\nin enforcing, any of its rights hereunder shall not be deemed a continuing\nwaiver or a modification thereof and any party may, within the time provided by\napplicable law, commence appropriate legal proceedings as set forth in\nparagraphs 6.4 and 9.8 hereof to enforce any and all of such rights. All rights\nand, except as provided in paragraph 9.8 hereof, remedies, provided for herein\nshall be cumulative and in addition to any other rights or remedies such parties\nmay have at law or in equity. Any party hereto may employ any of the remedies\navailable to it with respect to any of its rights hereunder without prejudice to\nthe use by it in the future of any other remedy with respect to any of such\nrights. No person, firm or corporation, other than the parties hereto and\n\n\n                                       14\n\nPLC, shall be deemed to have acquired any rights by reason of anything contained\nin this Agreement.\n\n                           9.4 The Design Partnership may, upon thirty (30)\ndays' written notice to the Company, assign its right to receive all or any\nportion of its compensation under this Agreement and, in addition, this\nAgreement and all of the Design Partnership's rights, duties and obligations\nhereunder may, upon thirty (30) days' written notice to the Company, be assigned\nby the Design Partnership to any entity to which the right to own or use the\nTrademarks has been assigned, or to an affiliate of any such entity. The Company\nmay not assign its rights and obligations under this Agreement without the prior\nwritten consent of the Design Partnership, which may be withheld in the Design\nPartnership's sole discretion.\n\n                           9.5 The Company will comply with all laws, rules,\nregulations and requirements of any governmental body which may be applicable to\nthe operations of the Company contemplated hereby, including, without\nlimitation, as they relate to the manufacture, distribution, sale or promotion\nof Licensed Products, notwithstanding the fact that the Design Partnership may\nhave approved such item or conduct. The Company shall advise the Design\nPartnership to the extent that any Final Prototype does not comply with any such\nlaw, rule, regulation or requirement effective in the Territory.\n\n                           9.6 This Agreement shall be binding upon and inure to\nthe benefit of the successors, heirs and permitted assigns of the parties\nhereto.\n\n                           9.7 This Agreement shall be construed in accordance\nwith and governed by the laws of the State of New York, applicable to contracts\nmade and to be wholly performed therein without regard to its conflicts of law\nrules.\n\n                           9.8 The parties hereby consent to the jurisdiction of\nthe United States District Court for the Southern District of New York and of\nany of the courts of the Southern District of New York and of any of the courts\nof the State of New York located within the Southern District in any action by\nthe Design Partnership to enforce its rights pursuant to paragraph 6.4 or 9.9\nhereof, and agree further that service of process or notice in any such action,\nsuit or proceeding shall be effective if in writing and delivered as provided in\nparagraph 9.1 hereof. Notwithstanding anything to the contrary set forth herein,\nneither Polo Ralph Lauren Corporation nor any other general or limited partner\nof the Design Partnership shall be liable for any claim based on, arising out\nof, or otherwise in respect of, this Agreement, and the Company shall not have\nnor claim to have any recourse for any such claim against any general or limited\npartner of the Design Partnership. In the event that (i) there is a dispute,\ncontroversy or claim arising out of or relating to this Agreement or the breach,\ntermination or validity thereof (hereinafter referred to as a 'Controversy'),\nand (ii) the parties hereto have not resolved such Controversy within sixty (60)\ndays (or such other period of time as the parties hereto may at the time\n\n\n\n                                       15\n\nagree upon) after either party gives written notice of such Controversy to the\nother, then the Controversy in question shall, at the request of either party,\nbe finally settled by arbitration in accordance with the Commercial Arbitration\nRules of the American Arbitration Association, in the manner set forth in\nparagraph 16.7 of the License Agreement.\n\n                           9.9 In the event of a breach or threatened breach of\nthis Agreement by the Company, the Design Partnership shall have the right,\nwithout the necessity of proving any actual damages, to obtain temporary\ninjunctive relief in a court of competent jurisdiction, it being the intention\nof the parties that this Agreement be specifically enforced to the maximum\nextent permitted by law pending final resolution by arbitration in accordance\nwith paragraph 9.8 hereof.\n\n                           9.10 Provisions of this Agreement are severable, and\nif any provision shall be held invalid or unenforceable in whole or in part in\nany jurisdiction, then such invalidity or unenforceability shall affect only\nsuch provision, or part thereof, in such jurisdiction and shall not in any\nmanner affect such provision in any other jurisdiction, or any other provision\nin this Agreement in any jurisdiction. To the extent legally permissible, an\narrangement which reflects the original intent of the parties shall be\nsubstituted for such invalid or unenforceable provision.\n\n                           9.11 The paragraph headings contained in this\nAgreement are for reference purposes only and shall not affect in any way the\nmeaning or interpretation of this Agreement. Any ambiguity in this Agreement\nshall not be construed against the party who prepared this Agreement.\n\n                           9.12 This Agreement may be executed in one or more\ncounterparts, each of which shall be deemed an original, but all of which\ntogether shall constitute one and the same instrument.\n\n\n\n\n                                       16\n\n                           IN WITNESS WHEREOF, the parties hereto have executed\nthis Agreement or caused the same to be executed by a duly authorized officer as\nof the day and year first above written.\n\n                                            Polo Ralph Lauren Enterprises, L.P.\n                                            By: Polo Ralph Lauren Corporation,\n                                                     General Partner\n\n\n                                            By:    \/s\/ Michael J. Newman\n                                               ---------------------------------\n\n                                            Polo Ralph Lauren Japan Co., Ltd.\n\n\n                                            By:    \/s\/ Hiroshi Kometani\n                                               ---------------------------------\n                                                       Hiroshi Kometani\n\nAcknowledged and Agreed:\n\nThe Seibu Department Stores, Ltd.\n\n\nBy:    \/s\/ Hiroshi Kometani\n   ------------------------------------\n\n\n\n                                       17\n\n                                                                      Schedule A\n\n\n                       EARNED COMPENSATION PERCENTAGE RATE\n\n                  Except as hereinafter provided with respect to Chaps Licensed\nProducts, during each year hereof, there shall be two applicable rates of earned\ncompensation applied against net sales of Licensed Products, depending upon the\nvolume of net sales achieved. For each year during the term hereof, the Earned\nCompensation Percentage Rate shall mean 'Initial Rate' applied to net sales of\nLicensed Products up to the 'Trigger Point' (which shall mean a pre-established\nvolume of the aggregate net sales price of all Licensed Products sold by\nLicensee, sales above which shall trigger a lower rate), and the 'Overroyalty\nRate', which shall be applied to all net sales in excess of the 'Trigger Point',\nall as hereinafter set forth. The first Trigger Point shall apply to net sales\nof all Licensed Products which do not bear the Chaps trademark. The second\nTrigger Point shall apply to net sales of all Licensed Products which bear the\nChaps trademark ('Chaps Licensed Products').\n\n\n\n\nYEAR\nCOMMENCING\nMARCH 1ST:             INITIAL RATE         TRIGGER POINT             OVERROYALTY\n                                            (IN [***] YEN)\n                                            (NON-CHAPS\/CHAPS)\n                                                             \n1998                   [***]                     [***]                [***]\n1999                   [***]                     [***]                [***]\n2000                   [***]                     [***]                [***]\n2001                   [***]                     [***]                [***]\n2002                   [***]                     [***]                [***]\n\nIf renewed:\n\n2003                   [***]                     [***]                [***]\n2004                   [***]                     [***]                [***]\n2005                   [***]                     [***]                [***]\n2006                   [***]                     [***]                [***]\n2007                   [***]                     [***]                [***]\n\n\n\n\n\n                                       18\n\nIf renewed:\n\n\n                                                           \n2008                   [***]                [***]                   [***]\n2009                   [***]                [***]                   [***]\n2010                   [***]                [***]                   [***]\n2011                   [***]                [***]                   [***]\n2012                   [***]                [***]                   [***]\n\n\n\n                  Notwithstanding anything to the contrary contained herein, the\nEarned Compensation Percentage Rate with respect to all sales of Chaps Licensed\nProducts shall be [***] percent [***]. Accordingly, the Company shall account \nfor and pay earned compensation in respect of net sales of Chaps Licensed \nProducts in excess of the Chaps Trigger Point set forth above, at the rate of \n[***] percent [***].\n\n\n                                       19\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8547],"corporate_contracts_industries":[9396],"corporate_contracts_types":[9613,9620],"class_list":["post-42219","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-polo-ralph-lauren-corp","corporate_contracts_industries-consumer__clothing","corporate_contracts_types-operations","corporate_contracts_types-operations__services"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/42219","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=42219"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=42219"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=42219"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=42219"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}