Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.
Exhibit 10.1
THIS AGREEMENT IS SUBJECT TO
ARBITRATION PURSUANT TO THE
SOUTH CAROLINA UNIFORM ARBITRATION ACT
DISTRIBUTION AGREEMENT
TABLE OF CONTENTS

          ARTICLE ELEMENT        
1. Definitions
    2  
2. Services
    3  
3. Term/Termination/Early Termination
    3  
4. Compensation
    4  
5. Terms of Payment
    4  
6. Safekeeping/Title
    4  
7. Loss-Damage: Storage/Handling
    4  
8. Charge-backs
    5  
9. Indemnification
    5  
10. Force Majeure
    5  
11. Insurance
    5  
12. Access Control
    6  
13. Assignment
    6  
14. Nondisclosure
    6  
15. Notice
    7  
16. Independent Contractor
    7  
17. Compliance with Laws
    8  
18. Nondiscrimination
    8  
19. Non-Waiver; Reservation of Rights
    8  
20. Waiver of Lien
    8  
21. Headings
    9  
22. Applicable Law
    9  
23. Severability
    9  
24. Authority
    9  
25. Interpretation
    9  
26. Arbitration
    10  
27. Successors and Assigns
    10  

Exhibits

            “A”    
Scope of Work
  “B”    
Compensation
  “C”    
Chargeback agreement

 

--------------------------------------------------------------------------------

 

Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.
DISTRIBUTION AGREEMENT
THIS DISTRIBUTION AGREEMENT (“Agreement”) is made and entered into as of the
13th day of February 2009, by R.G. BARRY CORPORATION, hereinafter referred to as
CUSTOMER, and UTi INTEGRATED LOGISTICS, INC., hereinafter referred to as
CONTRACTOR.
W I T N E S S E T H
WHEREAS, CONTRACTOR is in the business of providing storage, equipment,
management, and personnel for the operation of DISTRIBUTION CENTER facilities;
and
WHEREAS, Contractor has agreed to provide distribution services in a facility
known as Fontana or UTi DISTRIBUTION CENTER (hereinafter sometimes DISTRIBUTION
CENTER), located at 13230 San Bernardino Ave., Fontana, CA;
WHEREAS, CUSTOMER further desires to obtain DISTRIBUTION CENTER operating
services from CONTRACTOR; and
WHEREAS, both parties have considered their respective obligations and
responsibilities and the consequences of entering into a binding agreement and
are desirous of doing so.
NOW, THEREFORE, in consideration of the PREMISES and of the mutual covenants set
forth herein, the parties agree as follows:
ARTICLE ONE
DEFINITIONS

1.01.  
MATERIAL means any unfinished matter, including packaging supplies, furnished by
or on behalf of CUSTOMER to CONTRACTOR for handling, storage, or use.

1.02.  
PRODUCT means finished goods and parts that have been furnished by or on behalf
of CUSTOMER for handling, storage or use by CONTRACTOR.
  1.03.  
REPLACEMENT COST shall be defined as follows:

  (a)  
When the MATERIAL or PRODUCT was purchased by CUSTOMER, REPLACEMENT COST means
the price paid by CUSTOMER at the time of purchase.

  (b)  
When the MATERIAL or PRODUCT was manufactured by CUSTOMER for sale to customers,
REPLACEMENT COST means CUSTOMER’s lowest current (or most-favored-customer)
wholesale list price for the MATERIAL or PRODUCT less ten (10%) percent.

  (c)  
When the MATERIAL or PRODUCT was manufactured by CUSTOMER but not for sale to
customers, REPLACEMENT COST means CUSTOMER’s actual direct manufacturing cost.

1.04.  
PREMISES means that portion of the DISTRIBUTION CENTER devoted to CUSTOMER’s
PRODUCT and MATERIAL as set forth on Exhibit B attached hereto, which PREMISES
shall be used exclusively for CUSTOMER and shall be segregated from other
portions of the DISTRIBUTION CENTER.

 

2

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Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.
ARTICLE TWO
SERVICES

2.01.  
CONTRACTOR shall provide DISTRIBUTION CENTER services to CUSTOMER including the
handling, storing, shipping and transportation (pursuant to CUSTOMER’s direction
and instruction) of CUSTOMER’s MATERIALS and PRODUCTS that CUSTOMER elects to
deliver to CONTRACTOR, as further described in Exhibit A attached hereto.

2.02.  
CONTRACTOR shall obtain or provide all necessary personnel and equipment, in
addition to any provided by CUSTOMER, to enable it to perform its DISTRIBUTION
CENTER and shipping obligations hereunder.

2.03.  
CONTRACTOR shall strive to maintain the DISTRIBUTION CENTER and the equipment
used in the performance of services hereunder in a clean, proper, and safe
operating condition.

2.04.  
The services provided by CONTRACTOR hereunder shall be available eight (8) hours
per day, five (5) days per week, fifty-two (52) weeks per year (excluding
holidays designated by CUSTOMER). CONTRACTOR shall also provide overtime,
weekend and emergency service at other times requested by CUSTOMER upon
reasonable notice.

ARTICLE THREE
TERM/TERMINATION/EARLY TERMINATION

3.01  
This Agreement shall be effective as of the day and year first written above
(the Effective Date) and shall continue through December 31, 2011 (the “Initial
Term”). Thereafter this Agreement shall automatically renew for periods of one
(1) year (the “Renewal Term(s)) (unless written notice of termination is given
by either party at least one hundred twenty (120) days prior to the end of the
initial term or any extension thereof, in which event the termination shall be
effective as of the end of the “Initial Term” or the “Renewal Term” as the case
may be.

3.02  
Either party may terminate this Agreement for any or no reason upon ninety
(90) days’ written notice to the non-terminating party. In addition, if due to
casualty, condemnation or other occurrence the PREMISES or the DISTRIBUTION
CENTER are unavailable for the services the parties shall work in cooperation to
find replacement facilities to provide the services contemplated under this
Agreement; provided that if services are materially impaired at the PREMISES or
the DISTRIBUTION CENTER for a period of 90 days or more, or if because of the
nature of the occurrence CUSTOMER reasonably determines that services at the
PREMISES or the DISTRIBUTION CENTER shall be materially impaired for a period of
90 days or more, CUSTOMER may terminate this Agreement by written notice to
CONTRACTOR.

3.03  
Should CUSTOMER terminate this Agreement prior to the end of the “Initial Term”
or any “Renewal Term” for convenience (I.e., not due to a (I) termination of
CONTRACTOR’S lease for the DISTRIBUTION CENTER, (ii) the unavailability of the
PREMISES or the DISTRIBUTION CENTER makes the services unavailable or materially
impaired, or (iii) the default or bankruptcy of CONTRACTOR), CUSTOMER shall pay
to CONTRACTOR, on a monthly basis, base service charges and seasonal service
charges for months and the amount of space set forth in Exhibit B through the
expiration of the “Initial Term,” or the then applicable “Renewal Term,” as
appropriate, to the extent that such space is not utilized for other purposes.
CUSTOMER shall receive a credit against such service charges in the amount of
***** per square foot per month for all space utilized for other purposes.
CONTRACTOR shall use its best efforts to mitigate the services charges payable
by CUSTOMER and find other uses for such space, in its reasonable discretion;
provided that CONTRACTOR shall not be required to find a substitute use for the
space allocated to CUSTOMER until all other vacant space in the DISTRIBUTION
CENTER is utilized.

 

3

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Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.

3.04  
If either party hereto shall default in the substantial performance of any
obligation specified herein, the non-defaulting party shall notify the
defaulting party of the default in writing and, if such default is not remedied
within thirty (30) days from dispatch of such notice, the non-defaulting party
shall have the right to terminate this Agreement immediately, provided, however,
that, in the event that such default cannot be wholly cured within thirty
(30) days, the defaulting party shall have such longer period as shall be
reasonably necessary to cure the default so long as the defaulting party (a) has
commenced to cure within said thirty-day period and (b) continues diligently to
effect, and does effect, a cure within fifteen (15) additional days. Termination
under Article Three above shall not relieve or release either party hereto from
any rights, liabilities or obligations that have accrued prior to the effective
date of such termination. The term “obligations” in the context of these
Articles shall include MATERIALS and PRODUCTS which have been authorized by
release(s) but not yet delivered. Such release(s) shall be completed even if
delivery must occur after the termination date hereof.

ARTICLE FOUR
COMPENSATION

4.01.  
CUSTOMER shall pay CONTRACTOR in accordance with the schedule attached hereto as
Exhibit B Compensation. Should CUSTOMER request space in excess of that stated
in Exhibit B, the service charges shall be increased at the same rate (***** per
square foot of additional space per month ) to reflect the increase in space for
the actual months used. CUSTOMER must authorize all services under this
Agreement.

ARTICLE FIVE
TERMS OF PAYMENT

5.01.  
CONTRACTOR shall invoice CUSTOMER monthly for all services performed and sums
due under this Agreement during the preceding month.

5.02.  
Payment shall be due thirty (30) days after date of CONTRACTOR’s invoice. Any
payments not received by CONTRACTOR within thirty (30) days of the invoice date
shall be subject to a late-payment charge of one (1.0%) percent per month,
calculated from the invoice date. In the event a portion of an invoice is
questioned or in dispute, payment shall nonetheless be made of all portions not
in question.

ARTICLE SIX
SAFEKEEPING/TITLE

6.01.  
CONTRACTOR shall exercise reasonable care in the safekeeping and safe handling
of all CUSTOMER MATERIAL or PRODUCT when in the care, custody, and control of
CONTRACTOR. Unless otherwise specified in this Agreement, title to such MATERIAL
or PRODUCT shall remain with CUSTOMER. If requested by CUSTOMER, CONTRACTOR
shall segregate and placard such MATERIAL or PRODUCT indicating CUSTOMER’s
ownership. CONTRACTOR shall take no action inconsistent with CUSTOMER’s
ownership of CUSTOMER MATERIAL or PRODUCT.

ARTICLE SEVEN
LOSS-DAMAGE: STORAGE/HANDLING

7.01.  
CONTRACTOR is hereby granted an annual operational no-fault “loss-damage”
allowance in the amount of *****, to be based solely on the valuation and
inventory records of the Customer and the activities at the DISTRIBUTION CENTER
as reported to the Customer by UTi.

7.02.  
In the event of any loss or damage to MATERIAL or PRODUCT in excess of the
“loss-damage” allowance that results from the negligent acts or omissions of
CONTRACTOR, its employees, agents, or assigns, CONTRACTOR shall reimburse
CUSTOMER at REPLACEMENT COST up to a maximum of ***** Dollars per incident and
in the annual aggregate.

 

4

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Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.

7.03.  
CONTRACTOR shall report in writing to CUSTOMER any incident involving loss or
damage in excess of *****, and shall provide such documentation regarding the
incident as may be reasonably requested by CUSTOMER.

ARTICLE EIGHT
CHARGE-BACKS

8.01  
When preparing CUSTOMER’s goods for shipment to CUSTOMER’s customers, should
CONTRACTOR fail to comply with certain requirements of that preparation,
CONTRACTOR agrees to reimburse CUSTOMER for “Charge-backs” as set forth on
Exhibit C attached hereto and a part hereof. All Charge-backs must be reported
to CONTRACTOR within sixty (60) days of CUSTOMER receiving notification thereof.
CONTRACTOR will not be responsible for Charge-backs not reported to CONTRACTOR
within one (1) year after occurrence.

ARTICLE NINE
INDEMNIFICATION

9.01.  
CONTRACTOR will indemnify, hold harmless, and defend CUSTOMER against all
liability, loss and expense including, but not limited to, settlements,
judgments, court costs, and attorney fees incurred by CUSTOMER resulting from
any act or omission, whether negligent or intentional, by CONTRACTOR in
performance under this Agreement (other than those losses covered by the
“loss-damage” allowance in Article Seven above). This indemnity shall not apply
to the extent that the liability, loss or expense is caused by any act or
omission, whether negligent or intentional, on the part of CUSTOMER.

9.02.  
CUSTOMER will indemnify, hold harmless, and defend CONTRACTOR against all
liability, loss and expense including, but not limited to, settlements,
judgments, court costs, and attorney fees incurred by CONTRACTOR resulting from
any act or omission, whether negligent or intentional, by CUSTOMER in
performance under this Agreement. This indemnity shall not apply to the extent
that the liability, loss or expense is caused by any act or omission, whether
negligent or intentional, on the part of CONTRACTOR.

ARTICLE TEN
FORCE MAJEURE

10.01.  
No liability shall result to either party from delay in performance or from
nonperformance caused by circumstances beyond the control of the party who has
delayed performance or not performed, including but not necessarily limited to
acts of nature, acts of war, civil commotions, riots, strikes, lockouts, acts of
the government in either its sovereign or contractual capacity, accident, fire,
water damages, flood, earthquake, or other natural catastrophes. The
non-performing party shall be diligent in attempting to remove any such cause of
delay or non-performance and shall promptly notify the other party of its extent
and probable duration.

ARTICLE ELEVEN
INSURANCE

11.01.  
Each party shall carry and maintain in force as necessary at all times relevant
hereto insurance of the type and minimum coverage limits stated below:

  (a)  
Commercial General Liability (Occurrence Form), including contractual liability
in a Combined Single Limit for Bodily Injury and Property Damage: $1,000,000 per
occurrence;

  (b)  
Excess Liability — Umbrella form in the amount of $5,000,000 excess over
existing Employers Liability, General Liability, and Automotive Liability.

 

5

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Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.

11.02.  
Certificates of insurance evidencing the coverages required above of either
party shall be filed with the other party on or before the Effective Date of
this Agreement. Such certificates shall require that the insurer will give both
parties thirty (30) days’ advance notice of any changes in, or cancellation of,
coverage, but neither party shall incur any liability if the insurer should fail
to provide such notice.

11.03  
The minimum coverages required under this Agreement shall serve as limits to
CONTRACTOR’s liability to CUSTOMER for any of the covered expenses.

11.04  
Should the CONTRACTOR use the services of subcontractors, CONTRACTOR will
require subcontractor to carry the same level of insurance coverage.

ARTICLE TWELVE
ACCESS CONTROL

12.01.  
CONTRACTOR shall permit entry to the PREMISES only to CUSTOMER’s authorized
personnel or invitees and to such other persons whose presence is necessary for
the administration of the DISTRIBUTION CENTER operation or to carry on business
functions of CUSTOMER.

12.02.  
CONTRACTOR shall permit entry to the DISTRIBUTION CENTER only to those persons
whose presence is necessary for the administration of the DISTRIBUTION CENTER
operation or to carry on business functions of CUSTOMER and other customers of
CONTRACTOR utilizing space in the DISTRIBUTION CENTER.

ARTICLE THIRTEEN
ASSIGNMENT

13.01.  
The rights and obligations covered herein are personal to each party hereto, and
for this reason this Agreement is assignable only with the written consent of
the other party, such consent not to be unreasonably withheld.

ARTICLE FOURTEEN
NONDISCLOSURE

14.01.  
CONTRACTOR agrees not to disclose to third parties any information or knowledge
that may be gained or learned by it or its employees about the business,
products, employees or methods employed by CUSTOMER unless such disclosure is
necessary to perform services required under this Agreement. CONTRACTOR shall
restrict access to the PREMISES only to those persons permitted in this
Article Fourteen who have signed a confidentiality agreement.

 

6

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Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.

ARTICLE FIFTEEN
NOTICE

15.01.  
Whenever any notice, demand, consent, or approval shall or may be given
hereunder to either of the parties by the other, each such notice, demand,
consent, or approval shall be in writing and be sent by telecopier/fax with a
confirmation copy dispatched no later than the next business day by national
courier service (such as Federal Express), addressed as follows:

     
To CONTRACTOR at:
  With Copy to:
 
   
UTi Integrated Logistics, Inc.
  Stephen Savarese
Attention: President, Distribution
  General Counsel
700 Gervais Street
  UTi
Suite 100
  900 Cummings Center, Suite 403T
Columbia, South Carolina 29201
  Beverly, Massachusetts 01915
Fax: (803) 771-6785
  Fax: (978) 232-9921
 
   
To CUSTOMER at:
  With Copy to:
 
   
R.G. Barry Corporation
  R.G. Barry Corporation
Attention: Jose Ibarra
  Attention: Ann Scarberry
13405 Yarmouth Rd., NW
  13405 Yarmouth Rd., NW
Fax: (614) 866-9787
  Fax: (614) 729-7152

15.02.  
Either party may change its address for purposes of receipt of any such
communication by giving ten (10) days’ prior written notice of such change to
the other party in the manner prescribed above.

ARTICLE SIXTEEN
INDEPENDENT CONTRACTOR

16.01.  
CONTRACTOR’S relationship to CUSTOMER shall be that of an independent
contractor. Nothing in this Agreement shall be construed to constitute
CONTRACTOR, or any of its employees, representatives, or agents as an employee,
joint venturer, or partner of CUSTOMER. Moreover, except for CONTRACTOR’S
limited role as receiving and shipping agent at the DISTRIBUTION CENTER as
described in Section 16.03, nothing in this Agreement shall be construed to
constitute CONTRACTOR, or any of its employees, representatives, or agents as an
agent of CUSTOMER.

16.02.  
CUSTOMER shall refrain at all times from directing the work and activities of
CONTRACTOR’S employees, subcontractors, and agents. All operational suggestions
and requests by CUSTOMER shall be routed through CONTRACTOR’s Contract
Administrator. Likewise, all operational suggestions and requests by CONTRACTOR
shall be routed through CUSTOMER’s Contract Administrator. The names of the
Contract Administrators of each party shall be provided by Notice as set forth
in Article Nineteen.

16.03.  
Where required in the course of rendering service hereunder, CONTRACTOR shall be
considered CUSTOMER’s agent for the limited purpose of acting as a “shipper” or
“receiver” of MATERIAL or PRODUCT. As such, CONTRACTOR may sign or certify that
it has properly classified, described, packaged, marked, or labeled PRODUCTS or
MATERIALS for shipment and that they are in proper condition for transportation
according to the applicable regulations of the Department of Transportation.
Similarly, CONTRACTOR may certify and acknowledge receipt, after ascertaining
the accuracy of carrier’s count and the delivered condition of the MATERIALS or
PRODUCTS involved.

16.04.  
Neither party shall hire (or cause to be hired by a third party) any employee of
the other party during the “Initial Term” hereof and for a period of one
(1) year thereafter without first giving written notice to the other party. Any
party who hires (or causes to be hired by a third party) any employee of the
other party shall pay as an agreed training reimbursement fee to the other
party, within ten (10) days of demand therefor, a sum per occurrence equal to
the employee’s gross compensation for the six (6) months preceding the date of
demand.

 

7

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Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.

ARTICLE SEVENTEEN
COMPLIANCE WITH LAWS

17.01.  
Both parties agree that they shall in good faith endeavor to comply with all
applicable federal, state and local laws, rules, and regulations in the
performance of their obligations under this Agreement.

ARTICLE EIGHTEEN
NONDISCRIMINATION

18.01.  
CONTRACTOR acknowledges that it has a corporate policy of compliance with all
applicable laws, rules, orders, and regulations of governmental authority
covering the production, sale, and delivery of the materials or services
specified herein, including, but not limited to, Executive Order 11246, and the
rules and regulations promulgated thereunder, the Rehabilitation Act of 1973,
and the Vietnam Era Veterans Readjustment Act of 1974. Further, CONTRACTOR’S
policy also includes compliance with all applicable provisions of the Fair Labor
Standards Act of 1938, as amended.

ARTICLE NINETEEN
NON-WAIVER; RESERVATION OF RIGHTS

19.01.  
CUSTOMER’s or CONTRACTOR’s waiver of any of its remedies afforded hereunder or
by law is without prejudice and shall not operate as a waiver of any other
remedies that such party shall have available to it, nor shall such waiver
operate to waive such party’s rights to any remedies due to a future breach,
whether of a like or different character. In no event shall the failure of
CUSTOMER or CONTRACTOR to insist upon strict performance of any of the terms,
conditions and covenants herein be deemed to be a waiver of any rights or
remedies that CUSTOMER or CONTRACTOR may have, and shall not be deemed a waiver
of any subsequent breach or default in the terms, conditions and covenants
herein contained except as may be waived in writing.

ARTICLE TWENTY
WAIVER OF LIEN

20.01.  
All right, title and interest in and to all of the MATERIAL and PRODUCT shall
remain with CUSTOMER. CONTRACTOR, for itself and its successors and assigns,
hereby waives and relinquishes, and agrees to obtain from third parties who
might claim any such lien or right (such as CONTRACTOR’S secured creditors and
the landlord of the DISTRIBUTION CENTER), their written waiver and
relinquishment of all rights, if any, to any common law or statutory lien or
other right of retention whatsoever with respect to the MATERIAL and PRODUCT.
CONTRACTOR acknowledges that the provisions of the preceding sentence are a
bargained consideration essential to CUSTOMER’s agreement to CONTRACTOR’s
possession of the MATERIAL and PRODUCT. Unless otherwise provided herein, no
liens or judgments against, CONTRACTOR shall be applicable to CUSTOMER’s
property, including the MATERIAL and PRODUCT.

20.02.  
Within 5 business days after CUSTOMER’S execution of this Agreement, CUSTOMER
shall provide to CONTRACTOR during the initial term of this Agreement a standby
letter of credit (the “LC”) in form and substance reasonably acceptable to
CONTRACTOR and CUSTOMER, upon all of the following terms:

  (i)  
CONTRACTOR may draw upon the LC only in the event that CUSTOMER files, or has
filed against it, a petition in Bankruptcy and then only for amounts which have
not been paid to CONTRACTOR under this Agreement within 5 days after the due
date thereof; and

 

8

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Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.

  (ii)  
for the period from February 13, 2009 to February 12, 2010, the face amount of
the LC shall be *****; the face amount of the LC during the period from
February 13, 2010 to February 12,2012 shall be *****; the face amount of the LC
for the period from February 13,2012 to December 31,2012 shall be *****; and no
letter of credit shall be required after December 31, 2012, provided that the
parties may, at their option, discuss the possibility of mutually agreeing on
the need for a letter of credit after December 31,2012; and

  (iii)  
the obligations of CUSTOMER with respect to the LC may be provided by one or
more letters of credit and/or successive letters of credit, so long as a
replacement letter of credit is provided to CUSTOMER prior to the expiration of
the then existing letter of credit.

ARTICLE TWENTY-ONE
HEADINGS

21.01.  
All headings of the clauses of this Agreement are inserted for convenience only
and shall not affect any construction or interpretation of this Agreement.

ARTICLE TWENTY-TWO
APPLICABLE LAW

22.01.  
This Agreement shall be construed, enforced, and performed in accordance with
the laws of the State of South Carolina.

ARTICLE TWENTY-THREE
SEVERABILITY

23.01.  
In the event that any clause of this Agreement shall be found to be void or
unenforceable, such finding shall not be construed to render any other clause of
this Agreement either void or unenforceable, and all other clauses shall remain
in full force and effect unless the clause(s) that is/are invalid or
unenforceable shall substantially affect the rights or obligations granted to or
undertaken by either party.

ARTICLE TWENTY-FOUR
AUTHORITY

24.01.  
The parties hereby represent that they have full power and authority to enter
into and perform this Agreement, and the parties know of no Agreement, promises,
or undertakings that would prevent the full execution and performance of this
Agreement.

ARTICLE TWENTY-FIVE
INTERPRETATION

25.01.  
This Agreement, together with the attachments and Exhibits specifically
referenced and attached hereto, embodies the entire understanding between
CUSTOMER and CONTRACTOR, and there are no contracts, understandings, conditions,
warranties, or representations, oral or written, express or implied, with
reference to the subject matter hereof that are not merged herein. Except as
otherwise specifically stated, no modification hereto shall be of any force or
effect unless (a) reduced to writing and signed by both parties hereto, and
(b) expressly referred to as being a modification of this Agreement. Both
parties recognize that each equally participated in the preparation of this
Agreement, and no weight shall be given to, nor shall any construction or
interpretation be influenced by, any presumption of preparation of an Agreement
by CUSTOMER or by CONTRACTOR.

 

9

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Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.

ARTICLE TWENTY-SIX
ARBITRATION

26.01.  
Any controversy which shall arise between CUSTOMER and CONTRACTOR regarding the
rights, duties, or liabilities of either party hereunder shall be settled by
binding arbitration in Columbia, South Carolina in accordance with the South
Carolina Uniform Arbitration Act and pursuant to the rules of the American
Arbitration Association except that the arbiters shall have no authority to make
any award for punitive damages. The arbitration award shall be by written
decision and shall be final and binding. Judgment upon the award may be entered
and enforced by any court of competent jurisdiction.

26.02.  
Not withstanding the foregoing, if any arbitration proceeding shall be
commenced, or if any action at law or in equity, shall brought by either party
for any reason and including but not limited to or on account of any breach of
or to enforce or interpret any of the covenants, terms or conditions of this
Agreement, the prevailing party shall be entitled to recover costs and expenses,
including reasonable attorneys’ fees, from the other party and such attorneys’
fees and other costs and expenses shall be made a part of any award or judgment
rendered.

ARTICLE TWENTY-SEVEN
SUCCESSORS AND ASSIGNS

27.01.  
The covenants, conditions and agreements contained in this Agreement shall bind
and inure to the benefit of CUSTOMER and CONTRACTOR and their respective
successors and permitted assigns.

{Signature Page Follows}

 

10

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Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.
{Signature Page}
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their duly authorized representatives to be effective as of the day and year
first above written.

                  CONTRACTOR:       CUSTOMER:
 
                UTi INTEGRATED LOGISTICS, INC.       R. G. BARRY CORPORATION
 
               
By:
  /s/ Douglas L. Walker       By:   /s/ José G. Ibarra
 
                Its: President       Its: SVP Finance, CFO Date: April 20, 2009
      Date: April 23, 2009

Exhibits attached:

      “A”  
Scope of Work
“B”  
Compensation
“C”  
Chargeback Agreement

 

11

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Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.
EXHIBIT A

SCOPE OF WORK
This schedule is incorporated in and made a part of the Master Distribution
Services Agreement. This schedule provides a brief, non-inclusive
overview/guideline of the expected functions to be performed by the Operator at
the DISTRIBUTION CENTER (DC). The Seasonal Program (SP) is an integrated part of
the DC operations: however, program requirements and characteristics may vary
slightly from typical DC programs. RGB has contracted with UTi for storage and
distribution in the Ontario warehouse. RGB sells and ships slippers to such
department stores as ***** and several others. Their product is purchased from
overseas manufacturers and shipped to the LA port where they are picked up and
delivered to the warehouse. The warehouse will receive the goods, store and ship
according to RGB requirement.
RECEIVING

  •  
Warehouse will receive an ASN (943) for future in-transits. There will be one
ASN per container. Container may contain several PO’s.

  •  
Warehouse typically has 24 hours to unload, count and report to RGB the contents
received.

  •  
Several containers may arrive at one time. RGB will prioritize the unloading.

  •  
Unload container, blind count and receive into warehouse.

  •  
All OS&D’s signed off by supervisor and scanned to RGB.

  •  
Communicate to RGB via 944 product received.

  •  
RGB will update their system according to the 943 sent then modify manually to
correct quantities from our OS & D spread sheet.

  •  
No packing slip in containers. Warehouse will need to print In-transit report.

  •  
TR number, container and sku quantity are the information fields needed to
update the RGB system.

INVENTORY MANAGEMENT

  •  
Product will be stored as a single lotted item.

  •  
All products are case in and case out.

  •  
Warehouse will do cycle counting.

  •  
RGB requires one wall to wall inventory a year.

  •  
An 846 will be sent each week on Sunday for system reconciliation.

  •  
An 832 will be sent for item maintenance.

  •  
If an item already exists then the item supplemental file will have the old item
references removed and replaced with the new one.

ORDER MANAGEMENT

  •  
RGB will send a 940 for each order.

  •  
Orders will be received into future status. Orders have a start ship date and a
cancel after date.

  •  
Orders will be released for pick by ship date.

  •  
Orders may be picked early and held for shipping.

  •  
Orders will be release in waves if possible.

  •  
Pick tickets are printed for all orders.

  •  
Order changes will be communicated to CSR via email.

 

12

--------------------------------------------------------------------------------

 

Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.

  •  
***** orders will be governed by the 753 and 754 EDI transactions.

  •  
RGB will receive ***** orders Monday night.
    •  
Tuesday 753 sent to ***** and orders sent to warehouse.
    •  
Tuesday night ***** sends 754 to RGB.
    •  
Wednesday morning RGB sends modified 754 to warehouse.
    •  
Wednesday, warehouse will print labels and apply to cases.
    •  
Thursday carriers will begin picking up shipments.

  •  
UPS and FEDEX orders will be wave picked by carrier.

  •  
Labels will be printed at the UPS or FEDEX station.

  •  
UPS and FEDEX stations will be connected to and/or for shipment information to
be passed and processed automatically.

  •  
All orders must be confirmed when shipped to allow time for 945 to be generated
and sent to RGB where they will generate the customer ASN.

PICKING

  •  
Depending on the requirements of loading bt customer picking will happen on
individual orders, consolidate picks or wave picks.

  •  
***** will be bulked pick by ***** PO number by sku.

  •  
UPS and FEDEX bulked picked but process through stations by order.

SHIPPING

  •  
All orders will be routed using checklist provided by RGB.

  •  
Shipments will be tendered to carrier according to customer requirements.

  •  
All documents must be signed to requirement to prevent charge backs.

  •  
Depending on the customer floor loading and palletizing is used. Vics BOL must
be marked accordingly.

  •  
Once shipped, the order must be confirmed immediately for 945 timing.

SHIPPING DOCUMENTS

  •  
Picking ticket

  •  
UCC128 labels

  •  
Vics Bol

  •  
Manifest

  •  
Packing Slip

 

13

--------------------------------------------------------------------------------

 

Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.
EXHIBIT B
COMPENSATION

          Service   Cost   Comment
Premises: 13230 San Bernardino, Fontana, CA
       
 
       
1. Base monthly service charge
  *****   January – December
 
       
2. Seasonal monthly service charge
  *****   June – December
 
       
3. Unit Handling Rates
       
 
       
Inbound
  *****   per inbound carton
 
       
 
  *****   per inbound display
 
       
 
  *****   per inbound layer (****)
 
       
Outbound
  *****   per outbound carton
 
       
 
  *****   per outbound display
 
       
 
  *****   per outbound transfer
 
       
 
  *****   per outbound layer (****)
 
       
Transload
  *****   per carton
 
       
Supplies
       
 
       
4. Supplies (shrinkwrap, tape, cartons, etc.)
  ®   **********
 
       
5. Other
       
 
       
Special Project Labor
  *****   per warehouse hour
 
       
 
  *****   per warehouse overtime hour
 
       
 
  *****   per clerical hour
 
       
 
  *****   per clerical overtime hour
 
       
Reboxing / Recoup
  *****   per carton
 
       
Display prep (palletize, band, wrap)
  *****   per pallet
 
       
IT Support
  ®   **********
 
       
6. Compliance Manager (as mutually agreed to by the parties)
  ®   *****

Note: All compensation for items 4, 5 and 6 shall be subject to CUSTOMER’S
pre-approval.

 

14

--------------------------------------------------------------------------------

 

Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.
EXHIBIT C

CHARGE-BACK AGREEMENT
For each of the following failures to comply with requests, CONTRACTOR shall pay
to CUSTOMER, ***** of the charge-back incurred by CUSTOMER, up to a maximum of:

         
1. BOL
       
a. Missing BOL
    * ****
b. Incorrect documentation, Master BOL, Manifest, Supplement
    * ****
 
       
2. BOL Infractions
       
a. BOL not signed and dated by Driver and UTI
    * ****
b. Incorrect Cartons / Weight on the BOL
    * ****
c. BOL not marked SLC or SLDC
    * ****
d. Failure to mark Pallet Y/N
    * ****
e. Incorrect SCAC
    * ****
f. Missing Customer ID #
    * ****
g. Missing Trailer #, Seal #, Pro #
    * ****
h. Incorrect Freight Charge Terms
    * ****
 
       
3. ASN Failure
    * ****
 
       
4. Invalid Routing
       
a. Failure to follow customer lead time requirements for routing
    * ****
b. Incorrect routing method, such as call, fax, internet
    * ****
c. Failure to combine same day or consecutive day shipments
    * ****
d. Incorrect carrier
    * ****
e. Failure to fax docs, i.e., BOL, Manual ASN, Packing Lists, etc.
    * ****
 
       
5. Shipping outside of customer order window, early or late
    * ****
 
       
6. Small packaging routing errors
       
a. Incorrect Freight Type, i.e., prepaid, collect, 3rd Party, Consignee Bill
    * ****
b. Incorrect Carrier
    * ****
c. Invalid tracking numbers
    * ****

 

15

--------------------------------------------------------------------------------

 

Those portions of this Agreement that have been redacted were omitted pursuant
to a request for
confidential treatment and have been filed separately with the Securities and
Exchange Commission.

         
7. Labels
       
a. Scanning without Maintenance Log (with Maintenance Log — No Charge)
    * ****
b. Misplace Carton Labels
    * ****
c. Alignment / Formatting Errors
    * ****
 
       
8. Loading
       
a. OS & D
       
1. Concealed — SLDC — UTI not responsible, SLC — review of paperwork and
inventory to be done.
    * ****
2. Failure to load all or part of an order
    * ****
b. Improper Sort and Segregation per Checklist
    * ****
c. Loading Configuration, i.e., Multi-stop, High & Tight,
       
1. Multi-stop
    * ****
2. High & Tight
    * ****
3. Load Separation
    * ****
d. Incorrect Carrier
    * ****
e. Detention
    * ****
f. Palletization Errors
       
1. Strapping
    * ****
2. Stretch-wrap
    * ****
3. CHEP
    * ****
4. Pallet Labels
    * ****
5. Overhang
    * ****

 

16