LICENSE AND SUPPLY AGREEMENT BY AND BETWEEN
EXHIBIT
10.1
BY
AND BETWEEN
AKKURATE
LTD.,
with
offices in Xxxx 0, 0 Xxxx Xxxx, Xxxxxx XX0 0XX, Xxxxxx Xxxxxxx, acting through
its Directors, Xx. Xxxx Xxxxxxxxxxx Xxxxxxxx and Xx. Xxxxxxx Xxxxxxxxx, VAT
No.
GB788053886 (“Akkurate”)
AND
XXXXXX
CONFEZIONI S.R.L.,
with
offices in 47100 - Forlì (Italy), Via Gramadora nos. 12-14, acting through its
President, Xx. Xxxxxxx Xxxxxxxxx, VAT No. 01498280401 (“Xxxxxx”)
AND
CPMM
(Asia) Limited,
with
offices in Unit A, 10th
Floor,
Wo Kee Hong Building, 585-609 Castle Peak Road, Xxxx Xxxxx, New Territories,
Hong Kong (China), acting through its Director and duly empowered and authorized
signatory, Xx. Xxxxxxx Man Xxx XXX (“CPMM”)
WHEREAS
A)
Akkurate
has title to the distinctive signs “Xxxx
Xxxxxxxx”,
“Richmond”,
“Richmond
X”
and
“Richmond
Denim” in
their
various denominations sand specifications (the “Signs”),
as
evidenced by the logos attached hereto as Schedule “A”,
to be
also used as signboard and/or as elements identifying and qualifying a retail
point of sale.
B)
Akkurate
and Xxxxxx have entered into an agreement under which the latter shall
manufacture, market and sell products solely and exclusively developed by
Akkurate and identified by the Signs, and in particular the products listed
in
Schedule “B”
attached hereto (the “Products”).
C)
Akkurate
has already entered into and it is negotiating agreements with companies
other
than Xxxxxx (the “Third
Companies”),
on
the basis of which agreements the Third Companies shall manufacture, market
and
sell articles identified by the Signs other than the Products, and in particular
the articles listed in Schedule “C”
attached hereto (the “Articles”).
D)
On March 9, 2007 Xxxxxx has entered into an agreement with China
Premium Lifestyle Enterprise, Inc. (“CPL”), a company belonging
to the same group of companies as CPMM, under which CPL shall have an exclusive
right to import, sell and distribute man’s and woman’s apparel identified by the
trademarks “Xxxx Xxxxxxxx”, “Richmond X” and “Richmond Denim” (the “First
Agreement”) in the Exclusivity Area for ten (10) seasons starting from the
Spring/Summer 2008: all the foregoing as better set forth and under the terms
and conditions provided for in the First Agreement, which is hereby integrally
referred to, including its definitions.
1
E)
Akkurate
has expressed its intention to open points of sale identified by the Signs
in
Italy and abroad where only the Products and the Articles shall be retailed,
with the express exclusion of any products and articles other than the Products
and the Articles: the foregoing by means of license and supply
agreements.
F)
A
uniform point-of-sale design module has been identified and implemented,
which
shall be utilized for the structuring, layout and interior decoration of
the
points of sale referred to in recital E) above.
G)
Akkurate
has already communicated CPMM information and data concerning, among other
things: Akkurate’s company details and financial data, the Signs, the
“Xxxx
Xxxxxxxx”
and
the
“Richmond”
points
of sale operating in Italy and worldwide (if any), litigation between Akkurate
and its sublicensees related to the “Xxxx
Xxxxxxxx”
and
the
“Richmond”
points
of sale operating in Italy and worldwide during the last three (3) years
(if
any), and all other information requested by the law.
H)
Also
on
the basis of the information received from Akkurate referred to in recital
G)
above, CPMM has asked Akkurate for the right to use the Signs solely to identify
some points of sale to be opened and managed by CPMM in China, Hong Kong,
Macau
and Taiwan, in order to retail solely the Products and the Articles (the
“Points
of Sale”):
each
one of the Points of Sale shall be set up strictly in accordance with the
uniform design module referred to in recital F) above.
I)
CPMM
represents that a lease contract in its name is currently / shall be timely
in
force for the premises in which each one of the Points of Sale shall be located,
and CPMM undertakes to keep such lease contracts in force for the whole term
hereof, save for what is provided for in art. 16.3 hereof; CPMM further
represents that it has obtained / it shall timely obtain the required
authorizations and/or licenses for the retail of the Products and of the
Articles in each one of the Points of Sale.
J)
Akkurate
has declared its willingness to grant CPMM the right to open the Points of
Sale
identified by the Signs, on the conditions hereinafter specified.
K)
Akkurate
and Xxxxxx have selected CPMM because they have relied on CPMM’s current
shareholding structure and management.
Now,
therefore,
2
THE
PARTIES COVENANT AND AGREE AS FOLLOWS
Art.
1 - Recital
clauses and Schedules.
The
recital clauses and the Schedules of this Agreement are
an
integral part hereof, because they are in the nature of covenants.
Art.
2 - Scope
of the Agreement.
By
means
of its signature to this Agreement, Akkurate hereby:
| a) |
grants
CPMM the right to use the Signs solely in order to identify the Points
of
Sale, provided that CPMM shall use the Signs strictly in accordance
with
all the provisions of this Agreement, in particular but without limitation
with reference to the provisions regarding signboard, architectural
design, layout and interior decoration of the Points of
Sale;
|
| b) |
authorizes
CPMM to retail in the Points of Sale solely the Products and the
Articles
identified by the Signs, as they are currently and shall be in the
future
developed by Akkurate, and as they are manufactured and marketed
by Xxxxxx
and by the Third Companies.
|
Art.
3 - Points
of Sale.
3.1.
Akkurate,
Xxxxxx and CPMM hereby agree that CPMM shall, and CPMM hereby undertakes
to,
open and manage solely in China, Hong Kong, Macau and Taiwan, for the whole
term
of this Agreement:
| a) |
one
(1) Point of Sale which i)
shall be characterized by the Signs, and in particular by the
[“Xxxx
Xxxxxxxx”
/
“Richmond”]
sign, ii)
shall be located in Hong Kong in the “Harbour City” Department Store,
iii)
shall have a surface of eighty-one (81) square meters, iv)
shall be set up strictly in accordance with the concept set forth
in
recital F) and art. 7, v)
shall be opened to the public within the essential deadline of March
1,
2008 (the “First
Point of Sale”);
|
| b) |
at
least another twelve (12) Points of Sale which i)
shall
be characterized by the Signs (as better set forth in Schedule
“3.1”
attached hereto), ii)
shall be located in the cities indicated in Schedule “3.1”
attached hereto, iii)
shall have a surface of no less than one hundred and twenty (120)
square
meters, as regards the shops-in-shop and the boutiques, and of no
less
than forty (40) square meters, as regards the corners,
iv)
shall be set up strictly in accordance with the concept set forth
in
recital F) and art. 7, v)
shall be opened to the public in the seasons provided for in Schedule
“3.1”
attached hereto (the “Further
Points of Sales”);
the parties hereby further agree that it is of the essence that CPMM
open
in each one of the seasons governed by this Agreement at least the
number
of Points of Sale provided for in Schedule “3.1”
for each relative season, and that all the Points of Sale provided
for in
Schedule “3.1”
are opened during the term of this Agreement: however, CPMM shall
be
allowed to modify the order of the openings as provided for in Schedule
“3.1”.
|
3
3.2.
The
parties hereby agree that the location of each one of the Further Points
of Sale
to be opened by CPMM shall be subject to Akkurate’s express and written
approval, which CPMM shall timely ask for - also by submitting Akkurate the
relative plans and all the information requested by Akkurate from time to
time -
and which Akkurate shall give or reasonably deny on the basis: i)
of the
position of the proposed location within the relative department store xxx/xx
xxxx xxx/xx xxxxxx, ii)
of the
neighboring shops and their trademarks, iii)
of
the
proposed square meters, and iv)
of the
proposed date of opening; all the foregoing in order to protect the prestige
and
image of the Signs.
Akkurate
and Xxxxxx shall make their best efforts to reply to CPMM within ten (10)
days
from receipt of CPMM’s written proposal, it being however understood that
Akkurate and Xxxxxx shall be totally free to accept or reject any of CPMM’s
proposals.
3.3.
CPMM
hereby expressly recognizes and agrees that it is of the essence that it
opens
in each one of the seasons governed by this Agreement the number of Points
of
Sale provided for in Schedule “3.1”
attached hereto for each relative season: (i)
in case
of failure by CPMM to open in either the Spring/Summer 2008 and/or the
Fall/Winter 2008/2009 season at least the number of Points of Sale provided
for
in Schedule “3.1”,
Akkurate and Xxxxxx shall be entitled to terminate this Agreement in compliance
with the provisions of art. 1456 of the Italian Civil Code, by sending the
other
party a registered letter with return receipt, and (ii)
in case
of failure by CPMM to open in each season starting from the Spring/Summer
2009
season at least the number of Points of Sale provided for in Schedule
“3.1”
for
each relative season for a period in excess of six (6) months, without prejudice
to the provisions of art. 3.1 CPMM hereby expressly and irrevocably undertakes
since now to pay Akkurate as liquidated damages-penalty, within five (5)
days
after demand, the amount of Euro one hundred thousand/00 (€ 100,000.00) for each
one of the Points of Sale, which CPMM should fail to timely open: the foregoing
without prejudice a)
to
Akkurate’s right to claim for additional damages, and b)
to
Akkurate’s and Xxxxxx’x right to terminate this Agreement. CPMM hereby expressly
accepts such liquidated damages-penalty as fair, in light of Akkurate’s interest
in the timely opening of each one of the Points of Sale.
4
3.4.
CPMM
represents that it has already obtained / it shall timely obtain the required
authorizations and/or licenses for the retail of the Products and of the
Articles in each one of the Points of Sale.
Art.
4 - Exclusivity
right.
4.1.
CPMM
shall have the exclusivity right to sell the Products (for the avoidance
of any
doubts, not the Articles) solely in China, Hong Kong, Macau and Taiwan (the
“Exclusivity
Area”).
CPMM
expressly recognizes, and for all purposes agrees, that its exclusivity right
provided for above regards solely the ten (10) seasonal collections governed
by
this Agreement, i.e.
the
Spring/Summer 2008, Fall/Winter 2008/2009, Spring/Summer 2009, Fall/Winter
2009/2010, Spring/Summer 2010, Fall/Winter 2010/2011, Spring/Summer 2011,
Fall/Winter 2011/2012, Spring/Summer 2012, Fall/Winter 2012/2013 seasonal
collections: therefore, CPMM in any case shall have no exclusivity right
whatsoever as regards all the seasonal collections subsequent to the last
seasonal collection governed by this Agreement, i.e.
as
regards the seasonal collections starting from the Spring/Summer 2013
collection. In light of the above, CPMM since now expressly and irrevocably
waives any and all of its claims / objections, in case Akkurate, Xxxxxx,
the
Third Companies and/or other entities, at any time and also before the expiry
or
termination of this Agreement, should carry out, either inside or outside
the
Exclusivity Area, any activities howsoever connected to the sale, retail,
distribution, marketing, promotion, advertising of the Products and relating
to
seasonal collections other than the ten (10) seasonal collections governed
by
this Agreement, as listed above.
4.2.
In case
of early expiry or termination, for whatever cause, of this Agreement, CPMM’s
exclusivity right provided for in art. 4.1 shall be limited to the seasonal
collections up to the date of such early expiry or termination: as a
consequence, the provisions of art. 4.1 shall apply with the necessary
adjustments (mutatis
mutandis).
4.3.
For the
avoidance of any doubts, CPMM expressly recognizes and accepts that it shall
have no exclusivity rights whatsoever outside the Exclusivity Area.
Art.
5 - Signboard.
5.1.
Each one
of the Points of Sale shall be identified by the signboard featuring the
Signs,
and in particular the signs indicated in art. 3.1 and in Schedule “3.1”,
in
accordance with the specifications that Akkurate shall communicate to CPMM.
CPMM
shall not affix and/or exhibit - neither inside nor outside each one of the
Points of Sale - other names and/or signs and/or specifications whatsoever,
unless specifically and expressly authorized in writing by
Akkurate.
5
5.2.
CPMM
shall not affix and/or exhibit the signboard featuring the Signs prior to
obtaining the authorizations required under the law. Such authorizations,
whenever required, shall be requested and renewed by and at the expenses
of
CPMM.
Art.
6 - Management
of the Points of Sale.
6.1.
Without
prejudice to what is provided for in art. 21 hereof, each one of the Points
of
Sale shall be opened by CPMM and shall be organized and managed by CPMM at
its
exclusive expenses. Each one of the Points of Sale shall be attended to by
personnel in such number and with such skills as provided for in the list
attached hereto as Schedule “6.1”,
in
order to ensure efficient service to customers and to maintain the international
repute of the Signs. Any costs, charges and related benefits and welfare
treatments concerning the employees / personnel hired and however utilized
by
CPMM shall be exclusively paid for by CPMM.
6.2.
On
request of Akkurate, attendants at each one of the Points of Sale shall wear,
while on service, the uniform styled by Akkurate and to be purchased from
Xxxxxx.
6.3.
Under
this Agreement, Akkurate and/or Xxxxxx and/or the Third Companies shall in
no
way be liable for the organization and management of any of the Points of
Sale,
nor shall this Agreement give rise to any subordinate labor relationship
or any
agency, supply, partnership, shareholding or other relationship between Akkurate
and/or Xxxxxx and/or the Third Companies, on the one part, and CPMM, on the
other part: as a consequence, neither Akkurate nor Xxxxxx nor the Third
Companies shall be liable to third parties now or hereafter employed by CPMM
to
manage any of the Points of Sale.
6.4.
CPMM
shall hold Akkurate, Xxxxxx and the third Companies harmless from, and
indemnified against, any losses, liability and expenses (including legal
costs
and fees) and any damages suffered by them, whether collectively or
individually, or any damages to be paid by them as a result of the opening
and/or management of any of the Points of Sale, or of the use of the Signs
by
CPMM, or otherwise in relation to this Agreement: the foregoing also with
reference to any possible sublicensee(s) of CPMM, as provided for in art.
21 of
this Agreement. The provision of this paragraph and CPMM’s obligations deriving
therefrom shall survive expiry or termination of this Agreement.
6.5.
CPMM
shall execute a)
an
insurance policy covering civil liabilities toward any third parties (CPMM’s
employees, customers, delivery personnel, every person entering the premises
of
any of the Points of Sale for whatever purpose), and b)
a fire
insurance policy covering each one of the Points of Sale; all insurance policies
shall remain in full force and effect for the whole term of this
Agreement.
6
Art.
7 - Design
and decoration.
7.1.
Architectural
design, layout and interior decoration of each one of the Points of Sale
and any
subsequent substantial change in existing architectural or decoration features
shall be subject to Akkurate’s prior express and written approval, and shall be
entrusted solely to the architects and contractors that Akkurate shall timely
communicate to CPMM, which CPMM under its sole responsibility and liability
shall enter into specific agreements with: any and all fees and expenses
howsoever related to architectural design, layout and interior decoration
of
each one of the Points of Sale, as well as to possible subsequent substantial
changes of the same, shall be exclusively paid for by CPMM. At least one
hundred
and twenty (120) days before the scheduled opening date of each one of the
Points of Sale, as indicated in art. 3 and in Schedule “3.1”,
CPMM
shall send Akkurate, for its express and written approval, the plans and
the
sections of the relative Point of Sale.
7.2
CPMM
shall take prompt actions to always keep each one of the Points of Sale in
good
conditions and in line with the Signs’ image: the foregoing also in accordance
with Akkurate’s possible requests.
7.3.
CPMM
shall not alter or change any of the Points of Sale’s location, surface,
shop-windows or layout without Akkurate’s express and written
authorization.
Art.
8 - Term.
This
Agreement shall become effective upon execution hereof and starting from
the
Spring/Summer 2008 season; this Agreement shall continue in full force and
effect for ten (10) seasons only, up to the Fall/Winter 2012/2013 season’s
collection: this Agreement shall therefore cover solely the parties’ activities
relating to the Spring/Summer 2008, Fall/Winter 2008/2009, Spring/Summer
2009,
Fall/Winter 2009/2010, Spring/Summer 2010, Fall/Winter 2010/2011, Spring/Summer
2011, Fall/Winter 2011/2012, Spring/Summer 2012, Fall/Winter 2012/2013 seasons.
As a consequence, this Agreement shall terminate approximately on January
31,
2013.
It
is
expressly provided that this Agreement shall not be automatically renewed;
however, the parties shall meet at least one (1) year before the aforementioned
date, in order to consider the possibility of executing a new
contract.
7
Art.
9 - No
changes in CPMM and in CPMM’s business.
9.1.
Concurrently with the execution of this Agreement, CPMM delivers Akkurate
and
Xxxxxx a copy of i)
its
Articles of Association and Bylaws, and ii)
its
Shareholders’ register; CPMM furthermore undertakes to deliver Akkurate and
Xxxxxx a copy of its annual accounts / balance sheet relating to all the
years
covered by this Agreement within thirty (30) days after their
publication.
9.2.
This
Agreement is of a personal nature, being entered into in reliance upon and
in
light of the personal skills, qualifications and representations of CPMM,
as
well as in light of the trust and confidence placed in CPMM, its current
shareholders - as evidenced in the documentation attached hereto as Schedule
“9.2”
-
and
its current managing body who shall actively and substantially participate
in
the ownership and operation of each one of the Points of Sale. Therefore,
CPMM
shall cause that none of CPMM’s rights and powers under this Agreement be
assigned, transferred, shared or divided - voluntarily or involuntarily,
by
operation of law or otherwise, in any manner (including without limitation
by
means of transfer of shares, merger, de-merger, transfer of business / going
concern, etc.) - without Akkurate’s and Xxxxxx’x prior express and written
consent: all the foregoing without prejudice to the provisions of art. 22.
CPMM
shall furthermore promptly inform Akkurate and Xxxxxx of any modifications
that
should occur in CPMM’s managing body.
Art.
10 - Relationship
between CPMM and Akkurate.
10.1.
CPMM
shall sell the Products and the Articles solely in the Points of Sale. CPMM
shall make every effort to promote and develop the sale of the Products and
of
the Articles and to protect the image of the Signs. CPMM shall refrain from
carrying out any activities in any of the Points of Sale, which may howsoever
adversely affect the Signs. CPMM shall in particular, but without limitation,
refrain from selling in any of the Points of Sale any products and/or articles
other than the Products and the Articles identified by the Signs.
10.2.
CPMM
shall strictly and timely comply with Akkurate’s and/or Xxxxxx’x and/or the
Third Companies’ instructions in regard to promotion, advertising and
distribution of the Products and of the Articles. CPMM further undertakes
to use
in each one of the Points of Sale solely personalized “Xxxx
Xxxxxxxx”
and
“Richmond”
materials (including, without limitation: pens, bags, gift paper, ribbons,
tassels, merchandising goods, paperboard materials, etc.), which - at Akkurate
and Xxxxxx’x sole discretion - shall be either (i)
purchased by CPMM only from the suppliers that shall be communicated by Akkurate
to CPMM from time to time, or (ii)
ordered
by CPMM from third party manufacturers, provided that (a) said third parties
manufacturers shall strictly comply with Akkurate’s and Xxxxxx’x specific
instructions and that (b) Akkurate and Xxxxxx shall have previously approved
said third party manufacturers as well as the quality of the personalized
materials manufactured by them: Akkurate and Xxxxxx shall not unreasonably
deny
and/or delay the above said approvals.
8
10.3.
CPMM
shall not use the Signs, either directly or indirectly, for any use other
than
those specifically provided for in this Agreement.
10.4.
For
the
whole term hereof,
CPMM shall not engage, either directly or indirectly, in the setting up and/or
management of points of sale in the Exclusivity Area for the retail of apparel
and/or accessories other than the Points of Sale, if such points of sale
should
sell products and/or articles which directly compete with the Products and/or
with the Articles.
10.5.
Akkurate
warrants and represents, and CPMM hereby acknowledges, that it has exclusive
title to the names/signs “Xxxx
Xxxxxxxx”,
“Richmond”,
“Richmond
X”
and
“Richmond
Denim”
featured
by the Signs, either in the nature of griffe or trademark, trade name, corporate
name and signboard, and has legal capacity to xxx for the protection of the
relevant rights.
CPMM
furthermore acknowledges that the Signs may only be used, in whatever manner
or
form, either as trade name, trademark or signboard, only subject to the express
and written consent of Akkurate and in accordance with its
indications.
Therefore,
CPMM shall:
|
a)
|
abstain
from adopting or using the Signs, or a part thereof, in its trade
name or
corporate name, or in any other manner whatsoever save as expressly
provided for in this Agreement;
|
|
b)
|
abstain
from registering and/or using, either directly or indirectly, any
other
names and/or trademarks which are identical to, similar to or liable
to be
confused with the Signs, or a part
thereof;
|
|
c)
|
immediately
cease, upon expiry or termination of this Agreement for whatever
cause,
any use of the Signs in whatever form, except as provided for in
art. 17.2
hereof.
|
10.6.
As
consideration for the right to use the Signs on the basis of this Agreement,
as
well as for the services of general supervision of the relationships with
Xxxxxx
and with the Third Companies and of image control furnished by Akkurate,
CPMM
shall pay Akkurate, in each season, an amount equal to (i)
one
point fifty percent (1.50%), as regards the Spring/Summer 2008 and the
Fall/Winter 2008/2009 seasons, (ii)
one
point twenty-five of percent (1.25%), as regards the Spring/Summer 2009 and
the
Fall/Winter 2009/2010 seasons, (iii)
one
percent (1%), as regards the Spring/Summer 2010 and the Fall/Winter 2010/2011
seasons and (iv)
zero
point seventy-five percent (0.75%), as regards each subsequent season starting
from the Spring/Summer 2011 onwards, of the greater between the taxable amount
relating to the total purchases of the Products and of the Articles of each
season, and the minimum guaranteed amounts of purchase provided for in art.
12
for the same season. Such amount shall be paid in one single installment,
within
January 31 as regards each Fall/Winter season (for instance, within January
31,
2009, as regards the Fall/Winter 2008/2009 season) and within July 31 as
regards
each Spring/Summer season (for instance, within July 31, 2008, as regards
the
Spring/Summer 2008 season).
9
10.7.
In each
season CPMM shall invest in advertising campaigns related to the Products
and to
the Articles a further amount, which shall be equal to (i)
four
percent (4%) from the Spring/Summer 2008 up to the Fall/Winter 2009/2010
seasons, and to (ii)
eight
percent (8%) starting from the Spring/Summer 2010 season onwards of the greater
between the taxable amount relating to the total purchases of the Products
and
of the Articles of each season, and the minimum guaranteed amounts of purchase
provided for in art. 12 for the same season. The advertising campaigns referred
to above shall be discussed and agreed upon between Akkurate and CPMM in
advance, also as regards their creative contents, on the basis of a specific
advertising plan to be submitted by CPMM to Akkurate within the end of March,
as
regards each Fall/Winter season, and within the end of September, as regards
each Spring/Summer season: within thirty (30) days after the receipt of the
advertising plan, Akkurate shall communicate CPMM its approval or nonapproval
of
the above mentioned plan; in case of nonapproval, Akkurate and CPMM shall
agree
in good faith and in the shortest possible time on the advertising plan for
the
relevant season. At the end of each sale season, and thus within March 15,
as
regards each Fall/Winter season, and within September 15, as regards each
Spring/Summer season, CPMM shall supply Akkurate with adequate evidence,
through
supporting documents, that the investments provided for by the advertising
plan
have been duly made.
10.8.
In
addition to what is provided for in art. 10.7 above, CPMM shall invest no
less
than Euro ten thousand/00 (€ 10,000.00) for consumer advertising and promotional
activities connected to the opening of each one of the Points of Sale; to
this
end, at least sixty (60) days before the opening of each one of the Points
of
Sale, CPMM shall submit Akkurate, for the prior express and written approval
of
the latter, a specific promotion and advertising plan for the opening of
the
relative Points of Sale. Within thirty (30) days after receipt of the promotion
and advertising plan, Akkurate shall communicate CPMM its approval or
nonapproval of the above mentioned plan; in case of nonapproval, Akkurate
and
CPMM shall agree in good faith and in the shortest possible time on the
promotional and advertising plan for the opening of each one of the Points
of
Sale.
10
Art.
11 - Relationship
between CPMM, on one part, and Akkurate, Xxxxxx and the Third Companies,
on the
other.
11.1.
All
contracts relating to the purchase of Products shall be executed solely between
CPMM, on the one part, and Xxxxxx, on the other part, in accordance with
the
terms of sale and payment conditions provided for in the First
Agreement.
All
contracts relating to the purchase of Articles shall be executed solely between
CPMM, on the one part, and the Third Companies, on the other part, in accordance
with the terms of sale and payment conditions to be agreed between CPMM and
the
Third Companies.
11.2.
CPMM
hereby expressly undertakes to adopt such a consumer pricing policy as shall
be
suggested by Xxxxxx and by the Third Companies on the basis of market surveys
in
order to rationalize the terms of sale and to ensure, to any possible extent,
consistency of image, including commercial image, among the “Xxxx
Xxxxxxxx”
and
the
“Richmond”
points
of sale during the term hereof: in light of the above, CPMM shall in particular
comply, for the whole term of this Agreement, with the suggested terms and
price-lists indicated by Xxxxxx and by the Third Companies from time to
time.
11.3.
CPMM
shall not proceed to clearance sales without Akkurate’s and Xxxxxx’x express and
written authorization: to this end, at least thirty (30) days before the
beginning of the clearance sales CPMM shall ask for Akkurate’s and Xxxxxx’x
authorization, specifying and justifying the chosen timing for the clearance
sales, as well as the modalities, the xxxx-down, etc., that CPMM intends
to
apply; Akkurate and Xxxxxx shall reply to CPMM’s request within fifteen (15)
days after the receipt of CPMM’s request.
In
any
case, as regards clearance sales CPMM shall strictly comply with the timing,
the
modalities, the xxxx-down, etc. provided for by the applicable laws or
regulations and/or applied by the major competitors.
11.4.
CPMM
shall forthwith remove from each one of the Points of Sale any Products and
Articles left after the clearance sales of each season.
11
11.5.
Akkurate
shall not be liable to CPMM, nor is it giving CPMM any guarantee whatsoever,
in
regard to the performance by Xxxxxx and by the Third Companies under the
contracts executed with CPMM.
11.6.
Akkurate
shall not be liable to CPMM, nor is it giving CPMM any guarantee whatsoever,
in
regard to claims, actions or damages made or claimed by the purchasers of
the
Products and of the Articles.
11.7 Akkurate
warrants and represents that it is the owner of the Signs, and that the Signs
are free from any claims by third party that would interfere with the rights
granted to CPMM under this Agreement. It also warrants that the ownership
of the
Signs shall be valid in the Exclusivity Area during the term of this Agreement,
and shall keep CPMM fully indemnified against and from all claims or suits
arising out of the lawful and proper use by CPMM of the Signs and/or the
sale by
CPMM of the Products and the Articles in accordance with the provisions of
this
Agreement.
11.8 Akkurate
hereby declares that it will make its best efforts in order to keep in force
and
effect the agreements it entered into with Xxxxxx and the Third Party Companies
in relation to, respectively, the Products and the Articles; in any case,
Akkurate hereby guarantees since now that, in the event Akkurate should
substitute one or more of its licensees with new ones, the rights and
obligations of CPMM under this Agreement shall not be in any case suspended
and/or prejudiced.
Art.
12 - Minimum
guaranteed amounts of purchase.
CPMM
hereby undertakes to purchase in each season Products and Articles for amounts
not lower than the amounts provided for in the “Minimum
Guaranteed Amounts of Purchase”
attached hereto as Schedule “12”,
save
for the possible downward adjustment provided for in art. 4 of the First
Agreement: CPMM expressly recognizes that its obligations concerning the
minimum
guaranteed amounts of purchase are of the essence.
Art.
13 - Liability.
CPMM
shall be directly and exclusively liable to any third parties for any breaches
of the law of a civil, criminal, administrative or fiscal nature committed
in
the course of its activity.
Art.
14 - Information
on purchases, sales and stocks of the Point of Sale.
14.1.
In
order
to supply Akkurate and Xxxxxx with updates on purchases, sales and stocks
of
each one of the Points of Sale, CPMM shall deliver to Akkurate and to Xxxxxx
in
each month in relation to each one of the Points of Sale, within the thirtieth
(30th)
day of
the following month, a report evidencing the purchases, the sales and the
stock
of Products and Articles of the relative month, with the indication of both
quantities and values as well as the relative product categories.
12
14.2.
At
any
time during the term of this Agreement Akkurate and Xxxxxx shall have the
right
to request CPMM, which hereby accepts since now subject to its security
approvals, to integrate in each one of the Points of Sale and for the entire
term of this Agreement, its informatics system for the management of points
of
sales with the one that Akkurate will communicate to CPMM: the costs of such
an
integration of the informatics system, both connected to the hardware
(installation, maintenance and possible licenses) and to the software
(installation, purchase, upgrading and related possible licenses), shall
be
entirely borne by CPMM.
14.3.
CPMM
undertakes, in any case, to permit Akkurate and Xxxxxx and/or professionals
or
auditing firms appointed by them, by giving prior notice to CPMM, to check,
to
the greatest possible extent and including by means of inspection visits,
the
purchases, the sales and in general the bookkeeping of each one of the Points
of
Sale.
Art.
15 - Coordination
powers of Akkurate.
Akkurate
shall supervise the relationships with Xxxxxx and with the Third Companies
for
the supply of the Products and of the Articles to CPMM during the term of
this
Agreement. CPMM declares to be aware of, and to acknowledge, that Akkurate
is
the party guaranteeing the existence and lawfulness of the Signs, the lawful
continuation both of the relationship provided for in this Agreement and
of the
relationships with Xxxxxx and with the Third Companies for the supply of
the
Products and of the Articles, as well as the quality and image of such Products
and Articles: as a consequence, as far as the matters covered by this Agreement
are concerned, CPMM hereby undertakes for the whole term hereof to deal only
with Akkurate, since Akkurate is the sole appropriate subject legally entitled
to authorize, approve and coordinate the activities of Xxxxxx and of the
Third
Companies. The foregoing notwithstanding, CPMM however hereby expressly
recognizes, and for all purposes agrees, that Xxxxxx and the Third Companies
shall be the sole and only parties responsible for the duly fulfillment of
the
contracts entered into between Xxxxxx and the Third Companies, on the one
part,
and CPMM, on the other part.
Art.
16 - Specific
obligations of CPMM.
13
16.1.
The
provisions of art. 20 notwithstanding, CPMM hereby expressly undertakes not
to
transfer, let or lend in commodatum any of the Points of Sale to third parties,
nor assign the lease contract for any of the Points of Sale or transfer to
any
third parties, for any reason and in any manner whatsoever, the enjoyment
of the
premises of any of the Points of Sale, for the whole term of this Agreement
and
for a period of one (1) month after expiry or termination hereof, for whatever
cause.
16.2.
Save
for
what is provided for in the following art.16.3, CPMM further expressly
undertakes not to withdraw from, or terminate, the lease contract for any
of the
Points of Sale, or consent to or cause the withdrawal, expiry or termination
of
such lease contract for the whole term of this Agreement and for a period
of one
(1) month after expiry or termination hereof, for whatever cause, and CPMM
shall
immediately inform Akkurate and Xxxxxx of any action undertaken by the landlord
aimed at obtaining the withdrawal, expiry or termination of the lease contract
for any of the Points of Sale.
16.3.
In
the
event of termination by the landlord of the lease contract for any of the
Points
of Sale for causes that CPMM clearly demonstrates are not attributable to
CPMM,
the latter shall timely propose to Akkurate and Xxxxxx a suitable alternative
location where to move, at CPMM’s costs and expenses, the relevant Point(s) of
Sale: it is in any case hereby since now agreed that the opening to the public
of the Point(s) of Sale within the new location(s), shall occur not later
than
the date of closing to the public of the premises where the Point(s) of Sale
was
(were) previously located.
Art.
17 - Termination
17.1. A)
Each
party shall be entitled to terminate this Agreement in compliance with the
provisions of art. 1456 of the Italian Civil Code, by sending the other party
a
registered letter with return receipt, if such other party becomes subjected
to
bankruptcy or to any proceedings for the relief of creditors.
B)
In
addition to the specific provisions contained elsewhere in this Agreement,
this
Agreement may be terminated by Akkurate and by Xxxxxx upon giving CPMM a
sixty-(60)-day notice to cure the breach by registered letter with return
receipt jointly signed by Akkurate and Xxxxxx, if CPMM should breach, in
whole
or in part, one or more of its obligations undertaken under arts. 2; 3.1
and
3.2; 5.1 and 5.2; 6.1, 6.4 and 6.5; 7.1, 7.2 and 7.3; 9.1 and 9.2; 10.1,
10.2,
10.3, 10.4, 10.5, 10.6, 10.7 and 10.8; 11.1, 11.2, 11.3 and 11.4; 12; 14.1,
14.2
and 14.3; 15; 16.1, 16.2 and 16.3; 20; 21.1, 21.2, 21.3 and 21.4; 22; 23.1;
25
of this Agreement.
14
17.2.
If this
Agreement is terminated pursuant to art. 17.1 B) above, CPMM shall sell the
stock of the Products and of the Articles, unless prevented from doing so
by
objective and material causes, which have not been voluntarily created by
CPMM:
such stock-selling activity shall continue for a maximum period of six (6)
month
from the date of termination and at the market prices for the Products and
the
Articles usually applied by CPMM, unless otherwise agreed in writing with
Akkurate.
Art.
18 - Consequences
of expiry or termination.
18.1.
Upon
expiry or termination of this Agreement, for whatever cause, CPMM shall
immediately:
|
a)
|
remove
the signboard from each one of the Points of Sale and destroy it
by giving
satisfactory evidence to Akkurate;
|
|
b)
|
remove
from each one of the Points of Sale the typical architectural design,
layout, furnishing and interior decoration, as specified in art.
7
above;
|
|
c)
|
destroy
all advertising material bearing the Signs, which is held by CPMM
or which
is in its control;
|
|
d)
|
discontinue
any further use of the Signs, for whatever reason, save as provided
for in
the preceding art. 17.2.
|
18.2.
Upon
expiry or termination of this Agreement, for whatever cause, Akkurate shall
pay
CPMM no goodwill and/or indemnity and/or consideration and/or compensation
whatsoever in connection with said expiry or termination, and CPMM for any
purposes hereby expressly and irrevocably waives any such goodwill / indemnity
/
consideration / compensation.
18.3.
Upon
expiry or, in case of termination, upon the end of the sellout period provided
for in the preceding art. 17.2, CPMM shall transmit Akkurate and Xxxxxx a
detailed report of the stock of unsold Products and Articles for each one
of the
Points of Sale: within forty five (45) days
after the receipt of CPMM’s report, Akkurate (or, as regards only the Products,
also Xxxxxx) may purchase back - either directly or indirectly, in whole
or in
part - such stock of unsold Products and Articles at a price equal to fifty
percent (50%) of the purchase price originally applied to CPMM; in case Akkurate
and/or Xxxxxx should decide not to purchase back, in whole or in part, the
stock
of unsold Products and Articles, such stock shall be sold by CPMM only after
removing all labels, tags and whatever else bearing the Signs: satisfactory
evidence of the removal shall be given to Akkurate and to Xxxxxx (which shall
be
entitled to carry out inspections by means of their nominees) prior to selling
the stock.
15
Art.
19 - CPMM’s
shareholders.
19.1.
CPMM’s
sole shareholder holding the entire capital, i.e. CPL, who signs this Agreement
for its acceptance of the provisions of this art. 19.1, hereby undertakes,
also
on the basis of what is set forth in recital K) and in art. 9.2
hereof:
| a) |
not
to assign its interest (shares) in CPMM to third parties for whatever
reason without Akkurate’s express and written approval - which shall not
be unreasonably denied - for the whole term of this Agreement including
any possible renewals hereof;
|
| b) |
not
to consent, in any case, to third parties to enter into CPMM’s
shareholding structure through capital increases, mergers or any
other
means, without Akkurate’s express and written approval, which shall not be
unreasonably denied;
|
all
the
foregoing without prejudice to the provisions of art. 22 hereof.
19.2.
Akkurate
and Xxxxxx shall be entitled to terminate this Agreement in compliance with
the
provisions of art. 1456 of the Italian Civil Code, by sending CPMM a registered
letter with return receipt jointly signed by Akkurate and Xxxxxx, if CPMM
and/or
its shareholders should not fulfill, in whole or in part, their obligations
under art. 19.1.
Art.
20 - Preemption
right.
The
provisions of art. 16 being hereby expressly confirmed, if during the whole
term
of this Agreement and for a period of one (1) year after termination hereof
CPMM
intends to transfer one or more of the Points of Sale - in any manner, formally
or informally, directly or indirectly, including through assignment of
shareholdings or novation of the lease contract, or in any other manner
whatsoever - CPMM shall first offer to transfer such Point(s) of Sale to
Akkurate on the same terms granted to third parties, and Akkurate shall have
the
preemption right on the transfer.
CPMM
shall notify the proposed transfer to Akkurate by registered letter with
return
receipt, specifying the requested price. Akkurate may exercise its preemption
right by notifying its acceptance of the transfer offer and of the relevant
price, by registered letter with return receipt to be delivered to the post
office within one (1) month after the receipt of CPMM’s
notification.
If
CPMM
fails to give Akkurate the preemption right provided for in this art. 20,
CPMM
shall pay Akkurate as liquidated
damages-penalty, within five (5) days after demand, the amount of Euro one
hundred thousand (€ 100,000.00) for each one of the Points of Sale whose
premises CPMM should have offered to transfer to Akkurate: the foregoing,
without prejudice to Akkurate’s right to claim for additional damages. CPMM
hereby expressly accepts such liquidated damages-penalty as fair, in light
of
Akkurate’s interest in the possible transfer to Akkurate of the premises where
each one of the Points of Sale are located.
16
Art.
21 - Right
to sublicense.
21.1.
The
parties hereby expressly agree that CPMM shall have the right to sublicense
its
rights and obligations under this Agreement as regards the opening and
management of one or more of the Points of Sale to a third party, provided
(i) that
such
sublicensee(s) shall operate only in the Exclusivity Area, (ii) that
CPMM
shall communicate Akkurate in writing and in advance any useful details of
and
information on such sublicensee(s) (company name, headquarters, affiliate
companies, etc.), and (iii)
that
such sublicensee(s) shall in any case operate under CPMM’s control and
supervision.
It
is
however understood that Akkurate and Xxxxxx shall have no direct relationship
with said sublicensee(s): as a consequence, among other things, i)
Akkurate
and Xxxxxx shall always deal only with CPMM as far as this Agreement is
concerned, ii)
the
Products and the Articles shall be sold and delivered only to CPMM, which
shall
pay for them, iii)
CPMM
shall pay Akkurate the consideration provided for in art. 10.6 and shall
make
the advertising investments provided for in arts. 10.7 and 10.8, iv)
the
sublicensee(s) shall have no direct contact with Akkurate and/or Xxxxxx,
and
v)
CPMM
shall be anyway fully responsible and liable toward Akkurate and Xxxxxx for
the
sublicensee(s)’s actions, omissions and behavior, as well as for of all of
CPMM’s sublicensed obligations, also in relation to Akkurate’s and Xxxxxx’x
right to terminate this Agreement for breach; the foregoing in addition to
such
licensee(s)’s liability toward Akkurate and Xxxxxx.
21.2.
Akkurate
shall be entitled to control to the widest possible extent the duly management
of the Point(s) of Sale by the sublicensee(s) and the sale of the Products
and
of the Articles in the Point(s) of Sale: the foregoing including, for example
but without limitation, by means of direct inspections and checks by Akkurate,
and/or persons authorized by it, at the premises of the Point(s) of
Sale.
21.3.
In the
event any of CPMM’s sublicensee(s) do(es) not meet the high quality standard
characterizing the “Xxxx
Xxxxxxxx”
and
the
“Richmond”
Points
of Sale worldwide, the Products, the Articles and the Signs and/or do(es)
not
comply with any of the requirements/obligations provided for in this Agreement
(the “Default
Sublicensee(s)”),
Akkurate shall be entitled to serve a notice on CPMM requiring CPMM to cease
utilizing any Default Sublicensee(s) (the “Default
Notice”).
CPMM
shall give to the Default Sublicensee(s), within and not later than five
(5)
days after the receipt of the Default Notice from Akkurate, a thirty-(30)-day
written notice to cure the breaches indicated by Akkurate in the Default
Notice,
failing which the sub-license relationship/agreement shall immediately be
terminated by CPMM.
17
21.4.
The
foregoing notwithstanding, in case of gross breach by any sublicensee(s)
of any
of the requirements/obligations provided for in this Agreement, CPMM shall
cease
utilizing such Default Sublicensee(s) immediately after receiving Akkurate’s
Default Notice.
Art.
22 - Assignment
prohibited.
CPMM
shall not - for any reason, in any manner, formally or informally, directly
or
indirectly, in whole or in part - assign and/or transfer howsoever to third
parties this Agreement, or the rights which have been granted to it, or the
things it has been authorized to do under this Agreement.
Without
prejudice to the foregoing, CPMM shall however be entitled to assign and/or
transfer howsoever this Agreement, or the rights which have been granted
to it,
or the things it has been authorized to do under this Agreement, or the
interests/shares in CPMM, to companies belonging to the same group of companies
as CPMM, provided that before any such assignments/transfers CPMM shall give
evidence to Akkurate and Xxxxxx (i)
of the
structure CPMM’s group of companies and (ii)
of the
skills, qualifications and representations, as well as of the shareholding
structure and the managing body, of the assignee/transferee company.
Art.
23 - No
registration.
23.1.
CPMM
hereby expressly and irrevocably undertakes not to register this Agreement
in
any kind of register in any country in the world other than Italy, if and
where
such registration would modify the mutual rights and obligations of the parties,
or grant additional rights or impose additional obligations on either party,
without the Akkurate prior written approval. Without prejudice to the foregoing,
Akkurate hereby expressly authorizes CPMM to file this Agreement only on
the
Over-The-Counter Bulletin Board of the U.S.A. (the “OTCBB”)
and
only for the purposes provided by the Regulation no. 13A of the U.S.A.
Securities Exchange Act of 1934.
23.2.
The
provisions of art. 23.1 being hereby expressly confirmed, the parties agree
that
all the costs related to the possible registration in Italy of this Agreement
shall be borne by CPMM.
18
Art.
24 - Nonwaiver.
Failure
by Akkurate and/or Xxxxxx to enforce at any time strict compliance by CPMM
with
any provisions of this Agreement and/or waiver of any rights provided for
herein, shall not be deemed as waiver by Akkurate and/or Xxxxxx thereafter
to
require compliance by CPMM and/or to enforce such rights.
Art.
25 - Confidentiality.
Unless
otherwise required by mandatory provisions of any applicable laws, rules
or
regulations, each party shall treat as secret and strictly
confidential any
administrative, accounting, statistical or other documentation received from
the
other party on the basis or during the performance of this Agreement.
Furthermore, each party shall not disclose, nor use to its own benefit or
to the
benefit of third parties, even after expiry or termination of this Agreement,
any commercial or business secrets or any confidential information howsoever
related to the business or affairs of the other party, of which it has become
aware on the basis or during the performance of this Agreement.
Art.
26 - Different
product lines and different signs.
Akkurate,
Xxxxxx and CPMM recognize, and for all purposes agree, that CPMM is aware
of the
possibility of launching other product lines of various products conceived
and
created by Akkurate, such other product lines bearing signs which shall be
different from the Signs, even if they may contain the signs “Xxxx
Xxxxxxxx”,
“Richmond”,
“Richmond
X”
and
“Richmond
Denim”.
As a
consequence, CPMM irrevocably waives any and all of its rights to raise any
claims in this regard, such a waiver to take effect immediately.
Art.
27 - Force
majeure.
Should
one of the parties fail to perform any of its obligations under this Agreement
for causes of force majeure, such a nonperformance shall not give rise to
any
liability of the nonperforming party toward the other party which, as a
consequence, shall not be entitled to terminate this Agreement, nor to claim
for
any possible damages.
Force
majeure shall mean any events of any nature and kind, which i)
are
completely beyond the control of the parties, and ii)
have not
been directly or indirectly caused and/or induced, in whole or in part, by
the
nonperforming party, such as for example, but without limitation: wars,
uprisings, general strikes, lockouts, earthquakes, epidemics, etc.
The
party
which intends to avail itself of this force majeure clause shall give a written
notice to the other party.
Each
party shall be entitled to withdraw from this Agreement, by giving a written
notice to the other party, should the cause of force majeure last for a
continuous period of time in excess of one (1) month: for this purpose, Akkurate
and Xxxxxx shall be considered as a sole party.
19
Art.
28 - Applicable
law.
This
Agreement shall be governed by the Italian law, with the express exclusion
of
its provisions on the conflict of laws.
Art.
29 - Exclusive
jurisdiction and venue.
The
Court
of Milan shall be the only and exclusive Court having jurisdiction for any
disputes which may arise in connection with, or any disputes which may be
originated or derived from, this Agreement and/or the obligations provided
for
in this Agreement, with the express exclusion of any other venues.
Art.
30 - Domicile.
30.1.
For
the
purpose of any notices to be given under this Agreement, the parties hereby
declare to be domiciled as follows:
- Akkurate
Xxxx 0, 0 Xxxx Xxxx,
Xxxxxx XX, XX0 0XX,
Xxxxxx Xxxxxxx
Phone: x00 000 000 0000
Fax: x00 000 000 0000
Email: Xxxxx@XxxxXxxxxxxx.xxx
copy
to: Xxxx
Xxxxxxxx Showroom
Xxx X. Xxxxxx xx. 00
00000 Xxxxx (Xxxxx)
Phone: x00-00-00000000
Fax: x00-00-00000000
Email: x.xxxxxxxxx@xxxxxxxxx.xxx
-
Xxxxxx
Xxx Xxxxxxxxx 00/00
00000 Xxxxx (Xxxxx)
-
CPMM
Unit A, 10th
Floor,
Wo Kee Hong Building,
585-609 Castle Peak Road, Xxxx Xxxxx, New Territories,
20
Hong Kong (China)
Contact Person: Xx. Xxxxxx Hui
Phone: (000) 0000 0000
Fax: (000) 0000 0000
30.2.
Akkurate,
Xxxxxx and CPMM furthermore hereby designate their respective addresses,
as
indicated in the preceding art. 30.1, as their respective domiciles at which
service of process may be made in any legal actions or proceedings arising
hereunder.
London,
__________
________________
Akkurate
Ltd.
__________________
Xxxxxx
Confezioni S.r.l.
__________________
CPMM
(Asia) Limited
Authorized
Signatory: Xxxxxxx Man Xxx XXX (Director)
CPMM’s
sole shareholder (in relation to art. 19.1):
________________________________
China
Premium LifeStyle Enterprise Inc.
21
The
clauses hereinafter specified, which have been selected after negotiations
between the parties and which the parties declare to have read and accepted,
are
hereby specifically approved in writing under and to the effects of the
provisions of art. 1341 of the Italian Civil Code: 2; 3.1, 3.2 and 3.3; 4.1,
4.2
and 4.3; 5.1 and 5.2; 6.1, 6.2, 6.3, 6.4 and 6.5; 7.1, 7.2 and 7.3; 9.1 and
9.2;
10.1, 10.2, 10.3, 10.4, 10.5, 10.6, 10.7 and 10.8; 11.1, 11.2, 11.3, 11.4,
11.5
and 11.6; 12; 13; 14.1, 14.2 and 14.3; 15; 16.1 and 16.2; 17.1 and 17.2;
18.1,
18.2 and 18.3; 19.1 and 19.2; 20; 21.1 and 21.2; 22; 23.1 and 23.2; 24; 25;
26;
27; 28; 29; 30.2.
London,
__________
________________
Akkurate
Ltd.
__________________
Xxxxxx
Confezioni S.r.l.
__________________
CPMM
(Asia) Limited
Authorized
Signatory: Xxxxxxx Man Xxx XXX (Director)
CPMM’s
shareholders (in relation to art. 19.1):
_______________________________
China
Premium LifeStyle Enterprise Inc.
22
