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Sample Business Contracts

Jobbers Agreement - Liz Claiborne Inc. and Union of Needletrades, Industrial and Textile Employees (UNITE)

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                               JOBBERS AGREEMENT

                                 By and Between:

                             LIZ CLAIBORNE, INC. AND

             UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES

                                     (UNITE)
<PAGE>   2
                                TABLE OF CONTENTS

ARTICLE 1:        DEFINITIONS                                              2

ARTICLE 2:        SCOPE OF AGREEMENT                                       3

ARTICLE 3:        COMPANY'S CONTINUING OBLIGATIONS--
                  SUCCESSORS AND SUBSIDIARIES                              3

ARTICLE 4:        CONTRACTORS                                              3

ARTICLE 5:        STRUCK WORK--LABOR DISPUTE--
                  CROSSING PICKET LINES                                    6

ARTICLE 6:        COMPANY'S RESPONSIBILITY FOR
                  CONTRACTORS' PAYMENTS                                    7

ARTICLE 7:        EXAMINATION OF BOOKS AND RECORDS                         9

ARTICLE 8:        UNION LABEL                                              9

ARTICLE 9:        BENEFIT FUNDS                                           10

ARTICLE 10:       UNION AGENCY                                            15

ARTICLE 11:       COUNCIL FOR AMERICAN FASHION                            16

ARTICLE 12:       LIQUIDATED DAMAGES                                      16

ARTICLE 13:       ARBITRATION AND ADJUSTMENT
                  OF DISPUTES                                             17

ARTICLE 14:       CODE OF CONDUCT                                         19

ARTICLE 15:       CONFORMITY TO LAW--SAVING CLAUSE                        20

ARTICLE 16:       NO WAIVER                                               20

ARTICLE 17:       TERM                                                    21

                                       (i)
<PAGE>   3
         This AGREEMENT is made and entered into this     day of May 1997, by
and between Liz Claiborne, Inc., hereinafter designated as the "Company" and the
Union of Needletrades, Industrial and Textile Employees, hereinafter designated
as "UNITE" or the "Union".

         WHEREAS, the Company was a member of the New York Skirt and Sportswear
Association, Inc. (the "Association") for many years and was bound by the
collective bargaining agreements between the Association and Locals 23-25 and
Local 10, affiliates of UNITE, whose predecessor was the I.L.G.W.U. ( the
"Association Agreement"); and

         WHEREAS, the Association Agreement governed, inter alia, relations
between the Company and the Union and its affiliates, including the Company's
use as a jobber of contractors to manufacture its garments as part of the
integrated process of production; and

         WHEREAS, the Company has withdrawn from the Association and has
bargained individually with the Union and its affiliates; and

         WHEREAS, the parties wish to preserve certain terms and conditions from
the Association Agreement; and

         WHEREAS, the parties wish to cooperate in establishing conditions which
will tend to insure the stability of the industry and to provide methods for a
fair and peaceful adjustment of all disputes so as to secure uninterrupted
operation of work;

                   NOW, THEREFORE, the parties agree as follows:


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ARTICLE 1:  DEFINITIONS

         For the purposes of this Agreement, the following words are defined as
follows:

         1.1 "Union" means Union of Needletrades, Industrial and Textile
Employees ("UNITE").

         1.2 "Manufacturer" means one who manufactures all or part of its
garments in its inside shop and which may also produce its garments in
contractors' shops.

         1.3 "Jobber" means one who does not manufacture garments in its own
shop but who has all of its garments produced (sewn, finished, pressed and
sometimes cut) by contractors and who may or may not employ cutters and/or
sample makers and/or distribution workers or others.

         1.4 "Contractor" means one who produces garments from cut or uncut
goods for a manufacturer or jobber, including accessories, belts, covered
buttons, buckles, neckwear, artificial flowers, bias binding, tubular piping,
shoulder pads or embroideries, or who performs processing services, including
hemstitching, pleating and tucking, or performs cutting work, all of which are
part of the integrated process of production in the apparel and clothing
industry.

         1.5 "Inside shop" means a shop, wherever situated, owned, operated, or
controlled by the Company in which it manufactures its garments.

         1.6 "Outside system of production" means the system in the apparel and
clothing industry of having garments produced in contractors' shops.

         1.7 "Jobbers Agreement" means this Agreement between the Company and
the Union.
         
         1.8 "Union Contractor" means a contractor bound to a collective
bargaining agreement with UNITE or any of its affiliates.



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<PAGE>   5
ARTICLE 2:  SCOPE OF AGREEMENT

         2.1 This Jobbers Agreement governs the overall relationship between the
Company and the Union including the Company's use of contractors to produce its
garments.

         2.2 The terms and conditions of employment of the Company's bargaining
unit employees are not governed by this Agreement, but are governed by a
National Collective Bargaining Agreement, and local supplemental agreements
thereto.

ARTICLE 3:  COMPANY'S CONTINUING OBLIGATIONS--SUCCESSORS AND
SUBSIDIARIES

         All of the terms and provisions of this Agreement shall be binding upon
the Company and upon its subsidiaries, successors and assigns. In the event the
Company sells or transfers its business to another, it shall nevertheless
continue to be liable for the complete performance of the terms and provisions
of this Agreement by the purchaser or transferee until the purchaser or
transferee expressly, in writing, assumes such performance and agrees to be
fully bound by the terms and provisions of this Agreement.

ARTICLE 4:  CONTRACTORS

         4.1 The Union has a bona fide interest in the labor conditions existing
in all shops manufacturing garments and a close unity of interest exists among
the workers manufacturing garments regardless of the particular shops in which 
they are employed.


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         4.2 The Company and the contractors that manufacture garments or parts
thereof or otherwise perform work for it are closely allied and have a close
unity of interest with each other in the manufacture of garments, and in any
labor dispute, to the extent of any work performed on its garments, the Company
and its contractors are not "neutrals" with respect to each other but are
jointly engaged in an integrated process of production.

         4.3 For the purpose of eliminating substandard labor conditions,
protecting the employment opportunities and labor standards of all workers
manufacturing garments for the Company, whether employed in inside shops or
contractors' shops, achieving greater employment stability and enforcing the
provisions of this Agreement, the Company agrees that it shall confine its
production to workers employed in its inside shops, if any, or in shops of
contractors in contractual relations with the Union or its affiliates.

         4.4 Except as expressly limited by this Agreement, the determination of
quality, standards, price and availability, and all other terms of engagement of
contractors (which shall include the Company's Human Rights Standards of
Engagement), and revisions of same, are within the sole discretion of the
Company. Except as expressly limited by this Agreement, the Company has the sole
and exclusive right to retain and terminate the services of any contractor it
has engaged, and the foregoing shall not be subject to the arbitration
procedure.

         4.5 The Company agrees to provide the Union with a copy of the terms of
engagement of all domestic contractors it has selected.

         4.6 Whenever it shall appear that the Company gives work to or deals
with a "struck" contractor, the Company shall, upon notice to it, immediately
discontinue all dealings with such


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<PAGE>   7
contractor and shall immediately withdraw work which has not been put into 
production, and shall within five (5) days withdraw work which has been put 
into production. Notwithstanding the foregoing, withdrawal shall be orderly 
with due regard to the Company's seasonal and inventory requirements so as not 
to unfairly affect the Company's competitive position.

         4.7 Should the Company be found giving work to or dealing with a
non-Union contractor, the Company shall pay the Union an amount of damages equal
to twenty-five percent (25%) of the "gross amount" due to the contractor as
defined in Article 9.4 of this Agreement. Since it is difficult, if not
impossible, to ascertain the precise amount of damages payable under this
Article 4, the damages shall for all purposes be deemed liquidated damages.

         4.8 So long as the Company maintains a "substantial level" of Union
employment either directly, or indirectly through Union contractors, the sole
and exclusive remedy for violations of 4.3 shall be the payment of liquidated
damages as provided under 4.7. "Substantial level" is defined as employment,
either directly, or indirectly through Union contractors, of at least five
hundred (500) Union jobs. Should such employment fall below a "substantial
level" for any calendar year, the arbitrator may order the Company to maintain a
"substantial level" of employment.

         4.9 The Company shall inform non-Union domestic contractors to which it
is sending work: (i) of the Company's obligations under this Article, (ii) that
the Company will automatically accept that a contractor is in compliance with
the Company's Human Rights Standards of Engagement if that contractor has a
collective bargaining agreement with UNITE or any affiliate thereof, (iii) that
in the Company's opinion the contractor should enter into a 


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<PAGE>   8
collective bargaining agreement with UNITE or an affiliate thereof, and (iv) 
that the Company may have to withdraw work from the contractor in the event the
contractor is engaged in a labor dispute with UNITE or any affiliate thereof.

         4.10 Nothing contained in this Article shall be deemed to create or
enlarge any existing obligation to the workers employed in any contractor's
shop. Nothing herein shall be interpreted as making the Company responsible for
any of the acts of its contractors, except to the extent expressly set forth in
this Agreement.

ARTICLE 5:  STRUCK WORK--LABOR DISPUTE--CROSSING PICKET LINES

         The Company and its contractors have a close unity of interest with
each other and in any labor dispute, the Company and its contractors are not
neutrals with respect to each other but are jointly engaged in an integrated
production effort. Accordingly, the parties agrees, as follows:

                  a. The Company shall not, directly or indirectly, give any
work to or deal with any of its contractors engaged in the apparel and clothing
industry against which a lawful strike has been declared or approved by the
Union or any of its affiliates or with which any of them has a lawful labor 
dispute. Whenever it shall appear that the Company is giving work to or is 
dealing with a contractor against whom there is a lawful strike as set forth 
above, the Company shall, upon notice to it, immediately discontinue all 
dealings with such contractor and shall immediately withdraw work which has 
not been put into production, and shall within five (5) days withdraw work 
which has been put into production. Notwithstanding the foregoing,



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<PAGE>   9
withdrawal shall be orderly with due regard to the Company's seasonal and
inventory requirements so as not to unfairly affect the Company's competitive
position.

                  b. To the extent permitted by law, it shall not be considered
a breach of this Agreement on the part of the Union or any of its affiliates or
on the part of any employee of any of its contractors performing part of the
integrated process of production of the Company's garments, if such worker
refuses to cross any lawful picket line recognized by the Union or any of its
affiliates or to enter upon the lawfully picketed premises of said contractor,
either of his or her own volition or by direction of the Union or any of its
affiliates.

ARTICLE 6:  COMPANY'S RESPONSIBILITY FOR  CONTRACTORS' PAYMENTS

         To safeguard employment opportunities and labor standards and to
provide for the full payments of all amounts due to and/or on behalf of workers
who produce the Company's garments in its contractors' shops:

         6.1 The Company shall pay each of its Union contractors an amount at
least sufficient to enable it to provide such workers with the wages, earnings,
overtime, and holiday pay and to pay benefit fund contributions provided in the
applicable collective bargaining agreement.

         6.2 No part of the amount so paid by the Company to its contractor
shall be used by the contractor as payment for overhead and services. To insure
against diversion of monies intended for the workers, the Company shall, in
addition to the foregoing amount, pay to its contractor a reasonable amount for
overhead and/or services that shall be separately agreed upon between them or
their representatives.



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<PAGE>   10
         6.3 If the Company's contractor fails to pay the wages, earnings,
overtime, or holiday pay due to bargaining unit workers in its shop for work
produced for the Company, the latter shall be liable to its contractor's workers
for the payment of the foregoing. The Company's liability shall be limited to
such payment for ten (10) full days' work in every instance.

                  6.3.1 If the Company fails to pay its contractors on or before
the Tuesday following the week that such work was done, the Company's liability
for wages, earnings, overtime, and holiday pay shall be deemed extended beyond
ten (10) days by one (1) additional day for each additional day that such
workers were not so paid because the Company failed to make such required
payments to the contractor.

                  6.3.2 Where the workers in the shop of a contractor do not
receive their holiday pay on or before the Tuesday following the week in which
the holiday occurred, by reason of the fact that the shop was closed because of
lack of work, the liability of the Company for the ten (10) full working days
shall commence to run in every instance from the Tuesday following the day on
which production in such shop is resumed.

                  6.3.3 The Union shall give the Company notice of the
contractor's failure to make payments under this paragraph 6.3 as soon as
practicable.

         6.4 The Union agrees that the provisions of this article do not in any
manner whatsoever bind the Company to any other agreement.



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<PAGE>   11
ARTICLE 7:  EXAMINATION OF BOOKS AND RECORDS

         7.1 The Union, or accountants designated by it, may examine the
Company's books and records to determine compliance with this Agreement, except
as limited under 7.2. Such books and records shall be open to examination at
reasonable times upon reasonable notice to the Company.

         7.2 If the Company agrees to pay the maximum cumulative damages for the
contract year, as set forth in Article 12, then the Union shall have no right to
examine records to establish liquidated damages.

ARTICLE 8:  UNION LABEL

         The Company shall affix the UNITE Union Label to all garments and
accessories manufactured by or for the Company by its inside shops, if any, and
Union contractors in accordance with the Union label rules, regulations and
procedures, which, together with any amendments thereof, shall be deemed
incorporated in this Agreement with the same force and effect as if fully set
forth herein. All such labels shall be purchased by the Company from the Union.



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<PAGE>   12
ARTICLE 9:  BENEFIT FUNDS

         9.1 This Jobbers Agreement governs the benefit fund contributions paid
by the Company on behalf of the employees of its Union contractors. In the event
the Company contracts with a contractor that is party to a collective bargaining
agreement with the Union or an affiliate thereof, the terms of which do not
require the contractor to pay benefit fund contributions, the Company shall pay
to the funds designated below the amount required under the terms set forth
below. Any payment to the said funds shall neither bind nor commit the Company
to the terms of, nor make the Company party to any collective bargaining
agreement covering its contractors' employees.

         9.2 The Company shall not be responsible for paying benefit fund
contributions based on work sent to Union contractors whose collective
bargaining agreements with Union affiliates require the contractor to pay
benefit fund contributions.

         9.3 The term "Benefit Funds" is the collective designation of the
I.L.G.W.U. Eastern States Health and Welfare Fund; (hereafter "Eastern States
Health and Welfare Fund) Health and Vacation Fund of Amalgamated Ladies' Garment
Cutters' Union, Local 10; I.L.G.W.U. National Retirement Fund (hereafter
"Retirement Fund"); and I.L.G.W.U. Health Services Plan (hereafter "Health
Services Plan").

         9.4 The term "gross amount", means the amount paid or due a contractor
for labor, overhead and services, regardless of the period for which payment is
made or due, on garments or items manufactured by it for the Company, whether or
not such contractor is under contract with any affiliate of the Union. With
respect to a contractor that is under contract with the



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Union or any of its affiliates, said gross amount shall not include State
Unemployment Taxes, Federal Unemployment Taxes, Federal Social Security Taxes;
but it shall include, without exception, all other amounts paid or due to the
contractor.

         9.5 The Company shall pay monthly to the Union* on behalf of the
Benefit Funds as follows:

         9.5.1 As of: (i) June 1, 1997 a sum equivalent to ??%, (ii) effective
July 1, 1997, a sum equivalent to ??%, (iii) effective July 1, 1998, a sum
equivalent to ??%, and (iv) effective July 1, 1999, a sum equivalent to ??% of
the gross amount paid by or due from it to each of its contractors whose workers
are covered by a collective agreement with Local 23-25/Local 10.

                  9.5.2 As of: (i) June 1, 1997 a sum equivalent to ??%, (ii)
effective July 1, 1997, a sum equivalent to ??%, (iii) effective July 1, 1998, a
sum equivalent to ??%, and (iv) effective July 1, 1999, a sum equivalent to ??%
of the gross amount paid by or due from it to each of its contractors whose
workers are covered by a collective bargaining agreement with the Northeast
Department.

                  9.5.3 As of: (i) June 1, 1997, a sum equivalent to ??%, (ii)
effective July 1, 1997, a sum equivalent to ??%, (iii) effective July 1, 1998, a
sum equivalent to ??%, and (iv) effective July 1, 1999, a sum equivalent to ??%
of the gross amount paid by or due from it to each of its contractors whose
workers are covered by a collective bargaining agreement in effect with an
affiliate of the Union other than Local 23-25, Local 10 or the Northeast
Department.

--------
* THE AMOUNTS TO BE CONTRIBUTED UNDER PARAGRAPH 9.5 SHALL BE THE SAME AS SET
FORTH IN THE ASSOCIATION AGREEMENT, WHICH AGREEMENT SHALL NOT BE REFERENCED
HEREIN. THIS FOOTNOTE SHALL BE DELETED ONCE THE AMOUNTS ARE DETERMINED AND
FILLED IN THE DESIGNATED SPACES.



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         9.6 The Company shall also pay monthly to the Union on behalf of the
Health and Welfare Funds, a sum equivalent to .30% of the gross amount paid by
or due from it to each of its Union contractors to enable the Funds to make
payment of the Company's share of federal social security taxes (FICA), on
certain benefits paid by the Funds to the workers eligible therefor.

                  9.6.1 If there is an increase in the Company's share of
federal social security taxes (FICA), the Company will pay such additional sum
to the Union to enable the Funds to make full payment of the Company's share of
federal social security taxes (FICA).

         9.7 The aforesaid payments shall be allocated among and paid over by
the Union as set forth in Appendix "A."

         9.8 Collection: The sums paid to the Union on behalf of and allocated
by it to the Benefit Funds shall be subject to a reasonable collection fee.

         9.9 The Benefit Funds shall continue to be maintained and administered
in accordance with the by-laws or rules and regulations adopted for that purpose
and any amendments thereto. The Company shall have no legal or equitable right,
title, claim or interest in or to said funds or the administration thereof. No
individual employee or his beneficiaries shall have any legal or equitable
right, title or interest in, or claim against (i) his or any other employer's
payments toward the said funds, or (ii) against said funds, the trustees thereof
or their agent; or (iii) the Company or the Union except as may be provided by
the by-laws or rules and regulations of said funds.



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         9.10 The Health Services Plan and Retirement Fund are trust funds
established by collective bargaining agreements and maintained in trust for the
purpose of providing employees with health and welfare benefits and services,
and in the case of the Retirement Fund, retirement benefits and services. Each
of the aforesaid funds is, and shall continue to be administered by a Board of
Trustees, the members of which shall be the trustees of said funds. Each Board
of Trustees shall be composed of Union representatives and an equal number of
representatives of employer-contributors to said Funds. If any Board of Trustees
shall be deadlocked on any issue or matter arising in connection with the Fund
it administers, the same shall be decided by a neutral person as set forth in
the by-laws or rules and regulations of said Fund, and his decision shall be
final and binding. The parties hereto hereby ratify, confirm and approve the
composition and membership of each Board of Trustees as now or hereafter
constituted. The Eastern States Health and Welfare Fund is a trust fund
established by collective bargaining agreement and maintained in trust, for the
purpose of providing employees with health, welfare and recreation benefits and
services.

         9.11 An annual audit of the Eastern States Health and Welfare Fund, the
Retirement Fund and the Health Services Plan shall be made by accountants
designated by the body administering each Fund. A statement of the results of
such audit shall be made available for inspection by interested persons at the
principal office of the respective Benefit Funds and at such other places as may
be designated by the body administering each Fund.

         9.12 The monies paid towards the Eastern States Health and Welfare
Fund, the Retirement Fund, and the Health Services Plan shall not be used for
any purpose other than to



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provide for pensions or annuities on retirement or death of employees and
health, welfare and recreation services or benefits, and to pay the operating
and administrative expense thereof. The monies of said Funds shall be kept
separate and apart from all other monies.

                  9.12.1 The Board of Trustees or other body administering said
Benefit Funds is hereby authorized, in its sole discretion and upon such basis
as it deems desirable, and to the extent permitted by law, to transfer or mingle
the assets of or to merge any of said Benefit Funds with any other benefit fund
or funds now existing or hereafter established and provided for in a collective
bargaining agreement with the Union or an affiliate thereof. In the event of
such mingling, transfer or merger, the amounts hereinabove provided to be
allocated towards said funds shall be paid over to the fund or funds with which
there has been such mingling, transfer or merger.

                  9.12.2 The Union, the Board of Trustees of any of the Benefit
Funds, or any other body administering any of the Benefit Funds, or any of them,
shall be proper parties in interest to enforce collection of payments due from
the Company toward any of said funds.

                  9.12.3 The failure of the Company to pay the amounts due or to
file required statements with the Union shall be deemed a breach of this
Agreement. The Union may proceed under the arbitration provision of this
Agreement for an award against the Company directing payments and filing of
statements by the Company.

                  9.12.4 The arbitrator may also direct that the Company shall
pay to the appropriate Benefit Fund (i) interest at the rate of ten (10%)
percent per year on each monthly payment from the date when it becomes due, (ii)
the costs of investigations made to determine the amount due, 


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and (iii) attorneys' fees and expenses in amounts fixed by him and other
expenses incurred by the Union or any Benefit Fund in connection with the
arbitration proceeding and which may reasonably be incurred by it in connection
with any action or proceeding to confirm his award.

         9.13 Each Board of Trustees shall adopt and promulgate such by-laws or
rules and regulations to effectuate the purpose of the Fund which it administers
as it may deem necessary and desirable, including the detailed basis upon which
payments from the Fund will be made, and shall have the power to modify the same
from time to time. The parties hereto agree to be bound thereby and they are
hereby incorporated in and made part of this Agreement.

ARTICLE 10:  UNION AGENCY

         The parties agree that the sole persons authorized or having the power
to act as agents of the Union, or to bind the Union legally with respect to
matters arising out of this Agreement or arising out of the relations between
the Company and the Union, or to subject the Union to any liability whatever by
reason of any act or omission are the President of the Union and such additional
persons as the Union may formally designate by written notice to the Company.
The Union shall not be responsible for the acts or omissions of any other
person, including members and employees of the Union.




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<PAGE>   18

ARTICLE 11:  COUNCIL FOR AMERICAN FASHION

         The Company shall contribute on an annual basis $29,500 dollars to the
Council For American Fashion Labor-Management Industry Development Fund ("CAF").
CAF is an industry wide labor management committee established to, among other
things: expand and improve working relationships between labor and management,
enhance economic development, improve technology, increase the competitiveness
of the industry and help resolve related industry problems.

ARTICLE 12:  LIQUIDATED DAMAGES

         12.1 Should the Company violate any provision of this Agreement where
it is difficult or impossible to ascertain the specific amount of damages
suffered by the Union, then the Company may be liable to the Union for
liquidated damages. In fixing these damages, there shall be taken into account
any advantages gained by the Company through its violation, any deprivation of
earnings suffered by workers, any institutional harm suffered by the Union and
such other factors as are fair under the circumstances.

         12.2 If the Union and the Company are unable to agree upon the amount
of liquidated damages for such violation, then the matter shall be treated as a
dispute under Article 13, except that there shall be no dispute under Article 13
if the Company agrees to pay the maximum cumulative liquidated damages for the
contract year as provided in this Article. The proceeds of any such liquidated
damages shall be paid to the Union.




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         12.3 In consideration of the volume of employment in Union shops
provided by the Company directly and indirectly, the Union agrees to limit the
maximum cumulative liability of the Company for liquidated damages in any year
of the contract as follows:

                  June 1, 1997 to May 31, 1998           $2.5 million
                  June 1, 1998 to May 31, 1999           $2.5 million
                  June 1, 1999 to May 31, 2000           $2.5 million

Liquidated damages, if any, shall be paid by the Company within fourteen (14)
days of becoming due.

ARTICLE 13:  ARBITRATION AND ADJUSTMENT OF DISPUTES

         13.1 In the event either party believes that a breach of this Agreement
has occurred or a dispute arises over the interpretation or application of any
of the terms of this Agreement, the parties shall resolve the dispute as
follows. The aggrieved party shall submit its complaint in writing to the other
party. A meeting between the Company and the Union shall be held within five (5)
calendar days of the written complaint being submitted. If the dispute is not
resolved within that five (5) day period, either party may submit the dispute to
arbitration by written notice to the other party within forty-five (45) days
thereafter.

         13.2     The parties have designated the following four (4) impartial
arbitrators to serve during the term of this Agreement: (i) John Sands, (ii)
Daniel Brent, (iii) Robert Light, and (iv) Joanne Parker. If either the Union or
the Company refers a matter to arbitration, the parties shall attempt to agree
on an impartial arbitrator from the four (4) arbitrators so chosen to hear the



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<PAGE>   20
matter. If the parties fail to agree on the name of an impartial arbitrator
within ten (10) days from the date the request for arbitration was submitted by
the aggrieved party to the other party, then they shall select an arbitrator by
alternately striking members of the panel. The arbitrator who heard the previous
case shall be struck first. The parties shall alternate cases as to who shall
strike first.

         13.3 The arbitrator shall not have the authority to alter or amend this
Agreement, or to substitute any new provision for an existing provision of this
Agreement, or to bind the Company to any other agreement.

         13.4 The arbitrator may, in addition to the award of damages as
provided by this Agreement, command or restrain acts and conduct of the parties
in order to effectuate compliance with the terms of this Agreement. With regard,
however, to Article 4.3, 4.7 and 4.8 of this Agreement, the arbitrator shall not
be authorized nor empowered, and shall not under any circumstances whatsoever,
command or restrain any action, or provide any remedy except as expressly set
forth in Article 4.8 of this Agreement.

         13.5 If either party shall default in appearing before the arbitrator,
after reasonable notice has been provided to the party, the arbitrator is
empowered nevertheless to take the proof of the party appearing and render an
award thereon. Any award or decision of the arbitrator shall be final and
binding and shall be enforceable by appropriate proceedings at law or in equity.
The arbitrator shall require witnesses to testify upon oath or affirmation upon
the request of either party. The arbitrator's fee shall be borne equally by the
parties hereto.




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<PAGE>   21

         13.6 Any papers, notices or process to initiate or continue an
arbitration hereunder may be served by mail, and all papers, notices or
processes in any application to a court to confirm or enforce an arbitration
award hereunder, including the service of the papers conferring jurisdiction of
the parties upon the court, may be served by certified mail, in all cases
directed to the Company, Attention: General Counsel, 1441 Broadway, New York,
New York 10018, and to the Union, Attention: President, 1710 Broadway, New York,
New York 10019.

         13.7 The procedure herein established for the adjustment of disputes
shall be the exclusive means for the determination of all disputes, complaints,
controversies, claims or grievances whatsoever, including the arbitrability of
any dispute. It is intended that this provision shall be interpreted as broadly
and inclusively as possible. Neither party shall institute any action or
proceeding in a court of law or equity, State or Federal, or before an
administrative tribunal, other than to compel arbitration, as provided in this
Agreement, or with respect to the award of an arbitrator. This provision shall
be a complete defense to and also grounds for a stay of any action or proceeding
instituted contrary to this Agreement.

ARTICLE 14:  CODE OF CONDUCT

         The Company is a signatory to the terms of Code of Conduct and
Monitoring procedures established by the Presidential Task Force on the Apparel
Industry and intends to comply with 



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<PAGE>   22
same. This Article is not subject to enforcement under the arbitration
provisions of this Agreement or otherwise.

ARTICLE 15:  CONFORMITY TO LAW - SAVING CLAUSE

         15.1 The interpretation and enforcement of this Agreement shall be
governed by federal law and by the laws of the State of New York not
inconsistent therewith.

         15.2 If any provision of this Agreement or the enforcement or
performance of such provision is or shall at any time be determined to be
contrary to law or enjoined by a court or administrative agency, then such
provision shall not be applicable or enforced or performed except to the extent
permitted by law. The Union and the Company shall thereupon negotiate a
substitute provision.

         15.3 If any provision of this Agreement or its application to the
Company or any person or circumstance is held invalid or enjoined, the remainder
of this Agreement or the application of such provision to other circumstances
shall not be affected thereby.

ARTICLE 16:  NO WAIVER

         The failure of either party to this Agreement to require strict
performance of any provision of the Agreement shall not be deemed a waiver or
abandonment of any of the rights or remedies provided herein for violation of
the Agreement or any provision thereof; nor shall it


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constitute a waiver or abandonment of any right or remedy herein provided for a
subsequent violation of any provision of the Agreement.

ARTICLE 17:  TERM

         This Agreement shall go into effect June 1, 1997 and shall continue in
effect up to and including May 31, 2000.

         IN WITNESS WHEREOF, the parties have hereunto set their respective
hands and seals, and caused this Agreement to be signed by their respective
officials this _____ day of May, 1997.

LIZ CLAIBORNE, INC.                    UNION OF NEEDLETRADES, INDUSTRIAL
                                       AND TEXTILE EMPLOYEES (UNITE)

By /s/ Roberta S. Karp                 By /s/ Bruce Raynor
  ------------------------------         --------------------------------- 

                                       By /s/ Edgar Romney
                                         ---------------------------------


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