EXHIBIT 10(d)
FIRST AMENDMENT TO LICENSE
AGREEMENT DATED JUNE 24, 1996
BETWEEN XXXXX XXXXXXXX LICENSING, INC.
AND NOVEL-ITC LICENSING LIMITED
AGREEMENT entered into this 14/th/ day of September, 1998, by and between
XXXXX XXXXXXXX LICENSING, INC., having an address at 000 X. Xxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000 (hereinafter referred to as "Licensor") and NOVEL-ITC
LICENSING LIMITED, having its offices at 5-1, Xxxx-Xxxxxx, 0-Xxxxx, Xxxxxx-Xx,
Xxxxx 000-00 Xxxxx (hereinafter referred to as "Licensee").
W I T N E S S E T H :
WHEREAS, Xxxxx Xxxxxxxx Licensing, Inc. and Novel-ITC Licensing Limited,
entered into a license agreement dated June 24, 1996; and
WHEREAS, the parties have agreed to the amendments to said agreement
contained herein;
NOW, THEREFORE, the parties hereto, in consideration of the mutual
agreements herein contained and promises herein expressed, and for other good
consideration acknowledged by each of them to be satisfactory and adequate, do
hereby agree as follows:
1. Unless otherwise specified herein, all capitalized terms used herein
shall have the meanings ascribed to them in the License Agreement.
2. Paragraph 8.9 of the License Agreement shall be deleted in its entirety
and replaced by the following:
"8.9 MANUFACTURE OF LICENSED PRODUCTS.
(a) For purposes of this Agreement a "Third Party Manufacturer"
shall be defined as an entity or an individual which or whom Licensee or
any Sublicensee either hires or pays to manufacture the Licensed Products.
A "subcontractor" shall be defined as an entity or an individual which or
whom a Third Party Manufacturer either hires or pays to perform the
manufacturing tasks which the Third Party Manufacturer could otherwise
perform itself at its own facility or through its own employees and staff.
A "supplier" shall be defined as an individual or entity who produces
components for the Licensed Products, and provides such components to
manufacturer in order to assemble the finished Licensed Products. Examples
of a supplier include, but are not limited to, fabric/trim manufacturers,
yarn manufacturers, button manufacturers, or zipper
1
manufacturers, provided that such named manufacturers do not contribute
further to the manufacture of the finished Licensed Products.
(b) Licensee shall not permit Sublicensees to enter into any
agreement with any Third Party Manufacturer, subcontractor or supplier for
the manufacture of Licensed Products without the prior written consent of
Licensor, which consent must be obtained within three (3) months prior to
commencing production. In order to maintain Licensor's high standard of
quality control and to insure that appropriate measures are taken against
counterfeiting, Licensee's notice to Licensor shall include all of the
following information: (i) name and address of each proposed Third Party
Manufacturer, subcontractor or supplier; (ii) type of Licensed Products to
be manufactured; (iii) quantity of Licensed Products to be manufactured;
and (iv) any other relevant information. Licensee will also require
Sublicensees to obtain the signature of an authorized representative from
each Third Party Manufacturer, subcontractor or supplier used by
Sublicensee on a brief agreement, in a form prepared by Licensor,
designated to protect Licensor's rights in the Trademark (see Exhibit F).
Licensee acknowledges that it shall remain primarily liable and completely
obligated under all of the provisions of this Agreement in respect of such
subcontracting arrangements.
(c) Attached hereto as Exhibit G is Licensor's Supplier Code of
Conduct (the "Code") which applies to any entity manufacturing merchandise
under the Xxxxx Xxxxxxxx(R) label (including the components thereof).
Licensee shall ensure that Licensee, and all Sublicensees, Third Party
Manufacturers, subcontractors and suppliers comply with the terms of the
Code and shall evidence such compliance by, (1) upon execution of this
Agreement, Licensee executing the Code and having all of Licensee=s
Sublicensees, Third Party Manufacturers, subcontractors and suppliers
executed the Code in the form as attached or such other form as may be
provided by Company from time to time, and returning such document to
Licensor, and having all Sublicensees do the same with respect to each of
their Third Parties, and (2) publicly displaying and having all of
Licensee's Sublicensees, Third Party Manufacturers, subcontractors and
suppliers display the Code, in the most current form provided by Licensor,
in a clearly visible location in Licensee's manufacturing facilities (if
applicable) and in the manufacturing facilities of all of Licensee's
Sublicensees, Third Party Manufacturers, subcontractors and suppliers, and
having all Sublicensees require their Third Parties to do the same, at all
times during the term of this Agreement.
(d) Licensee acknowledges that it has in effect (or will
promptly develop) and that all of its Sublicensees have in effect (or will
promptly develop), to the satisfaction of Licensor, a program of monitoring
manufacturing facilities operated by Licensee, Sublicensee, and Licensee's
and Sublicensee's Third Party Manufacturers, subcontractors and suppliers
which is sufficient to ensure their compliance with the Code and all
applicable state, local and foreign laws and regulations pertaining to
wages, overtime compensation, benefits, hours, hiring and employment,
workplace conditions
2
and safety, the environment, collective bargaining, freedom of association
and that their products or and the components thereof are made without the
use of child (persons under the age of 15 or younger than the age for
completing compulsory education, if that age is higher than 15), prison,
indentured, exploited bonded, forced or slave labor. Such compliance shall
be evidenced by Licensee, upon execution of this Agreement, executing and
abiding by, and requiring all Sublicensees to execute and abide by, the
Certification in the form as attached hereto as Exhibit H, and executing
and abiding by, and requiring all Sublicensees to execute and abide by,
such other form as may be provided by Licensor from time to time.
(e) Within thirty (30) days after a new arrangement with a
Sublicensee, Third Party Manufacturer or subcontractor is established, Licensee
shall inspect each of Licensee's Sublicensee, Third Party Manufacturer or
subcontractor and provide approval, in writing, signed by an authorized employee
or agent of Licensee that such Sublicensee, Third Party Manufacturer or
subcontractor is in compliance with Paragraph 8.9(d) above, and shall obtain and
provide to Licensor the signature of an authorized representative from each of
such parties on a Third Party Manufacturing Agreement in the form as Exhibit F
attached hereto, or such other form as may be provided by Licensor from time to
time, and Licensee shall require all Sublicensees to do the same with respect to
each of their Third Party Manufacturers and subcontractors. Within thirty (30)
days after a new arrangement with a supplier is established, Licensee shall
obtain and provide to Licensor the signature of an authorized representative
from each supplier on a Certification in the form as Exhibit H attached hereto,
or such other form as may be provided by Licensor from time to time, and
Licensee shall require all Sublicensees to do the same with respect to each of
their suppliers. In the event that Licensee has knowledge of, has reason to
believe, or should have reason to know that any Sublicensee, Third Party
Manufacturer, subcontractor or supplier of Licensee is in breach of the Third
Party Manufacturing Agreement or Certification, or if any Sublicensee has
knowledge of, has reason to believe, or should have known that any of its Third
Parties is in breach of the Third Party Manufacturing Agreement or
Certification, Licensee shall immediately notify Licensor and Licensee, shall,
at its sole expense, take, and shall require its Sublicensee to take, immediate
action to rectify such breach, including, where Licensor deems it necessary,
immediate termination of Licensee's or Sublicensee=s relationship with such
third party. If Licensee or any Sublicensee fails to take immediate action or
such action is not successful, Licensee shall assign its rights to proceed
against such Sublicensee, Third Party Manufacturer, subcontractor or supplier to
Licensor and shall require its Sublicensee to do the same, and Licensor shall,
at Licensee's expense, have the right to pursue all available remedies to
protect its rights. Notwithstanding the foregoing, Licensee acknowledges that
it shall remain primarily liable and completely obligated under all of the
provisions of this Agreement in respect of the production of Licensed Products
hereunder.
(f) In order to maintain Licensor's high standard of quality
control and to insure that appropriate measures are taken against
counterfeiting, Licensee shall provide notice to Licensor, on a quarterly
basis, including all of the following information: (i) the name and
address of each Sublicensee, Third Party Manufacturer, subcontractor and
3
supplier of Licensee and any Sublicensee; (ii) the type of Licensed
Products manufactured by such Sublicensee, Third Party Manufacturer and
subcontractor; (iii) quantity of Licensed Products to be manufactured by
each such entity; (iv) the type of components provided by each supplier;
and (iv) any other relevant information regarding all such entities.
(g) Licensee shall ensure, and will require all Sublicensees
shall ensure, that all merchandise manufactured hereunder shall be
manufactured in compliance with all federal, state and local laws which
pertain to the manufacture of clothing, apparel, and other merchandise
including the Flammable Fabrics Act, as amended, and regulations thereunder
and Manufacturer guarantees, that with regard to all products, fabrics or
related materials used in the manufacture of the Products, for which
flammability standards have been issued, amended or continued in effect
under the Flammable Fabrics Act, as amended, reasonable and representative
tests, as prescribed by the Consumer Product Safety Commission, have been
performed which show that the Products at the time of their shipment or
delivery conform to the above-referenced flammability standards as are
applicable.
(h) All Licensed Products manufactured in the United States
(whether by Licensee, any Sublicensee, by Licensee's or any Sublicensee's
manufacturer or by manufacturers' contractors) shall be in compliance with
all applicable requirements of Sections 6, 7, and 12 of the Fair Labor
Standards Act, as amended, and all regulations and orders of the United
States Department of Labor under Section 14 thereof, and applicable state
and local laws pertaining to child labor, minimum wage and overtime
compensation; and, all Licensed Products manufactured outside the United
States, (whether by Licensee, any Sublicensee, by Licensee's or any
Sublicensee's manufacturer or by manufacturers' contractors) shall be
manufactured in compliance with the wage, overtime compensation, benefits,
hour, hiring and employment, workplace conditions and safety,
environmental, collective bargaining, freedom of association laws of the
country of manufacture and without the use of child (persons under the age
of fifteen or younger than the age for completing compulsory education, if
that age is higher than 15), prison, indentured, exploited bonded, forced
or slave labor.
(i) Licensee will require, and shall ensure that all Sublicensees
require, that all commercial invoices (bills of lading) which accompany
all Licensed Products must include the following language (either
preprinted or "stamped"):
"We hereby certify that the merchandise (including components thereof)
covered by this shipment was manufactured in compliance with the Xxxxx
Xxxxxxxx Supplier Code of Conduct and: (1) if the merchandise was
manufactured in the United States, it was manufactured in compliance
with (a) sections 6, 7, and 12 of the Fair Labor Standards Act, as
amended and all regulations and orders of the United States Department
of Labor under section 14 thereof, and (b) state and
4
local laws pertaining to child labor, minimum wage and overtime
compensation; or (2) if the merchandise was manufactured outside the
United States, it was manufactured in compliance with the wage and
hour laws of the country of manufacture and without the use of child
(persons under the age of 15 or younger than the age for completing
compulsory education, if that age is higher than 15), prison,
indentured, exploited bonded, forced or slave labor. We further
certify that we have in effect a program of monitoring our
subcontractors and suppliers and other designated contract facilities
which manufacture Xxxxx Xxxxxxxx/R/ brand merchandise for compliance
with the foregoing. We also certify that the merchandise is in
compliance with all laws governing the designation of country of
origin and, if applicable, is being shipped under legally issued and
valid export license or visa."
(j) Licensee shall not utilize or permit any Sublicensee, Third
Party Manufacturer, subcontractor or supplier, and shall require all
Sublicensees to not permit any of their Third Parties, to utilize in the
manufacture or treatment of any Licensed Products (including the components
thereof) manufactured hereunder any Azo dyes that can be split into any of
the following amines:
CAS #
-----
4-Aminobiphenlyl 92-67-1
Benzidine 92-87-5
4-Chloro-o-toluidine 95-69-2
2-Naphthylamin 91-59-8
o-Aminoazotoluol 97-56-3
2-amino-4-nitrotoluol 99-55-8
p-Chloroaniline 106-47-8
2,4-Diaminoanisole 615-05-4
4,4'-Diaminodiphenylmethane 101-77-9
3,3'-Dichlorbenzidin 91-94-1
Aminoanabenzane
CAS #
-----
3,3'-Dimethoxybenzidine 119-90-4
3,3'-Dimethylbenzadine 119-93-7
3,3'-Dimethyl- 838-88-0
4,4'diaminodiphenylmethane
p-Kresidin 120-71-8
4,4'Methaylen-bis-(2-chloranilin) 101-14-4
4,4'Oxydianiline 101-80-4
4,4'Thiodianiline 139-65-1
o-Toluidine 95-53-4
2,4-Toluylenediamine 95-80-7
2,4,5-Trimethylaniline 137-17-7
o-Anisidine
(k) Licensee's use or the use by any Sublicensee, Third Party
Manufacturer, subcontractor or supplier of the following chemicals in
connection with the manufacturer or treatment of any Licensed Products
(including the components thereof) manufactured hereunder, shall be in
accordance with the following standards or such other standards Licensor may
designate from time to time:
(i) Formaldehyde: Must be less than 300 p.p.m. when tested in by
------------
the Acetylacetone method in accordance with Japanese law
112.
(ii) Pentachlorophenol (Pesticides): Must be less than 5 p.p.m.
------------------------------
5
and; (iii) Nickel: In the event any metal parts of a garment or
------
other merchandise coming into contact with the skin, contain
nickel in excess of 0.5 micrograms per square
centimeter/week, Company must be so notified and special
warning labels need to be attached to the garment."
3. Paragraph 8.11 of the License Agreement is hereby deleted in its
entirety and is replaced by the following:
"8.11 INSPECTION OF FACILITIES. Licensee shall regularly, and not less
than two (2) times per year, inspect the facilities it utilizes and
those facilities utilized by all of Licensee's Sublicensees and Third
Parties for compliance with this provision and Licensee shall require
all Sublicensees to do the same with respect to each of their Third
Parties. Licensee shall take all action necessary to cure any
deficiencies and shall require all Sublicensees to do the same.
Licensee further agrees that it shall terminate and shall require any
Sublicensee to terminate any agreement with any third party found to
be in default of the terms of this provision on three (3) separate
inspections. Licensor and its duly authorized representatives shall
have the right, during normal business hours and upon reasonable
notice, to inspect all facilities utilized by Licensee, its
Sublicensees, and all of Licensee's and any Sublicensee's Third Party
Manufacturers, subcontractors and suppliers in connection with the
manufacture, sale, storage or distribution of Licensed Products, and
to examine (i) Licensee's manufacturing facilities, residential
facilities (if any) and any manufacturing and/or residential facility
operated by any Sublicensees, and by any of Licensee's and
Sublicensee's Third Party Manufacturers or subcontractors; (ii)
Licensee's, any Sublicensee's, and any of Licensee's and Sublicensee's
Third Party Manufacturers or subcontractors books, records and
documents necessary to evidence such entities compliance with the Code
and all applicable laws, rules and regulations including, but not
limited to, employee wages, employee timecards, withholding rates and
deductions, worker's contracts and/or agreements, any company policies
affecting employees, evidence of employee age, shipping documents,
cutting reports and other documentation relating to the manufacture
and shipment of the Products; and (iii) Licensee's, any Sublicensee's,
and any of Licensee's and Sublicensee's Third Party Manufacturer's or
subcontractor's books, records and documents relating to the use of
chemicals and dyestuffs in the fabrics, trims, garments and other
merchandise manufactured hereunder. For purposes of this Paragraph,
all such books, records and documents shall be maintained by Licensee
and all Sublicensees in a secure and readily accessible location for a
period of three (3) years from their creation."
4. Exhibit F, in the form as attached hereto and such other form as
provided by Licensor from time to time, shall be appended to the License
Agreement.
6
5. Exhibit G, in the form as attached hereto and such other form as
provided by Licensor from time to time, shall be appended to the License
Agreement.
6. Exhibit H, in the form as attached hereto and such other form as
provided by Licensor from time to time, shall be appended to the License
Agreement.
7. Except as modified hereby, all other paragraphs contained therein shall
remain in full force and effect and nothing contained herein shall alter them in
any way and are hereby in all respects ratified and confirmed.
IN WITNESS WHEREOF, Licensor and Licensee have respectively signed this
Amendment as of the date first written above.
XXXXX XXXXXXXX LICENSING, INC. NOVEL-ITC LICENSING LIMITED
By: /s/ Xxxxxxxx X. Xxxxxx By: /s/ X. Xxxxxx
-------------------------------- -------------------------------
Title: Assistant Secretary Title: President
------------------------------ ---------------------------
Date: Sept. 14, 1998 Date: Sep. 02, 1998
------------------------------- ---------------------------
7
