Services Agreement - RR Donnelley & Sons Co. and J Crew Inc.
J. Crew, Inc.
770 Broadway
New York, New York 10003
CATALOG August 14, 1997
DESCRIPTION
This proposal covers the production of your Fall/Winter and
Spring/Summer Catalogs as described in the clause entitled
QUANTITY AND NUMBER OF PAGES, for a period of 4 years commencing
with production of your 1997 Fall/Winter Edition 1 Catalog and
continuing through completion of your 2001 Spring Final Edition
Printed by 6/30/01.
Subject to the provisions set forth herein, you engage us, and we
shall be obligated and entitled to do or arrange for all cylinder
making and/or plate making, printing, binding, loading and
mailing, required for the production of the catalogs and all
preliminary work as set forth in the PRELIMINARY MANUFACTURING
PROCESS clause. We agree to perform the work as provided herein
and to furnish all necessary materials and supplies therefor
except such as you, pursuant to the terms hereof, agree to
furnish. We will give you prior notice if we subcontract any of
your work and furnish you with the name and location of the
subcontractor at the time we give you prior notice.
In consideration for your awarding us a four year agreement, we
agree to issue a credit equal to $500,000 on an invoice issued
within thirty (30) days of your written request, but in no event
earlier than the date of signing and no later than December 31,
1997. In consideration for giving you this credit, you agree to
repay us $250,000 one hundred and eighty (180) days after we
issue our credit, and a second repayment of $250,000 three
hundred and sixty (360) days after we issue our credit.
QUANTITY AND NUMBER OF PAGES
1997 Fall/Winter Scheduled
--------------------------
Quantity
Body Cover (To Nearest
Event Pages Pages Size 1,000)
----- ----- ----- ---- -----------
Fall/Winter Season
------------------
Edition 1 132 4 8-1/4" x 10-3/4" 2,122,000
Prospect 1 80 4 8-1/4" x 10-3/4" 1,567,000
Edition 2 144 4 8-1/4" x 10-3/4" 2,928,051
Prospect 2 80 4 8-1/4" x 10-3/4" 2,456,845
Edition 3 160 4 8-1/4" x 10-3/4" 2,573,000
Prospect 3 96 4 8-1/4" x 10-3/4" 2,665,000
Edition 4 208 4 8-1/4" x 10-3/4" 2,408,000
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August 14, 1997
Prospect 4 152 4 8-1/4" x 10-3/4" 2,626,000
Edition 5 216 4 8-1/4" x 10-3/4" 3,448,000
Prospect 5 152 4 8-1/4" x 10-3/4" 4,095,000
Edition 6 192 4 8-1/4" x 10-3/4" 3,315,000
Edition 7 184 4 8-1/4" x 10-3/4" 3,394,000
Edition 8 120 4 8-1/4" x 10-3/4" 2,314,000
Prospect 8 80 4 8-1/4" x 10-3/4" 761,000
Women's Catalog
---------------
Women's 2 80 4 7-5/8" x 10" 1,717,652
Women's 3 80 4 7-5/8" x 10" 1,456,651
Women's 4 88 4 7-5/8" x 10" 1,700,000
College Catalogs
----------------
Catalog 1 64 4 9-3/8" x 11-3/8" 1,950,000
1998 Forecasted (continued)
---------------
Quantity
Body Cover (To Nearest
Event Pages Pages Size 1,000)
----- ----- ----- ---- -----------
Spring/Summer Season
--------------------
Edition 1 96 4 8-1/4" x 10-3/4" 2,400,000
Prospect 1 72 4 8-1/4" x 10-3/4" 2,000,000
Edition 2 120 4 8-1/4" x 10-3/4" 2,400,000
Prospect 2 72 4 8-1/4" x 10-3/4" 1,000,000
Edition 3 120 4 8-1/4" x 10-3/4" 2,400,000
Prospect 3 72 4 8-1/4" x 10-3/4" 1,000,000
Edition 4 120 4 8-1/4" x 10-3/4" 2,400,000
Prospect 4 72 4 8-1/4" x 10-3/4" 1,450,000
Edition 5 96 4 8-1/4" x 10-3/4" 2,600,000
Prospect 5 72 4 8-1/4" x 10-3/4" 500,000
Women's Catalog
---------------
Women's 1 96 4 7-5/8" x 10" 1,300,000
Women's 2 96 4 7-5/8" x 10" 1,500,000
Women's 3 96 4 7-5/8" x 10" 1,600,000
Women's 4 72 4 7-5/8" x 10" 1,600,000
Swimwear Catalog
----------------
Swimwear 1 48 4 8-1/4" x 10-3/4" 2,950,000
Swimwear 2 48 4 8-1/4" x 10-3/4" 3,050,000
College Catalogs
----------------
Catalog 1 64 4 9-1/8" x 11-3/8" 1,600,000
Catalog 2 64 4 9-1/8" x 11-3/8" 1,600,000
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J. Crew, Inc. Page 3
August 14, 1997
1998 Forecasted (continued
---------------
Quantity
Body Cover (To Nearest
Event Pages Pages Size 1,000)
----- ----- ----- ---- -----------
Catalog 3 64 4 9-1/8" x 11-3/8" 1,600,000
Catalog 4 64 4 9-1/8" x 11-3/8" 1,700,000
Fall/Winter Season
------------------
Edition 1 120 4 8-1/4" x 10-3/4" 2,400,000
Prospect 1 72 4 8-1/4" x 10-3/4" 1,000,000
Edition 2 144 4 8-1/4" x 10-3/4" 2,600,000
Prospect 2 72 4 8-1/4" x 10-3/4" 1,500,000
Edition 3 144 4 8-1/4" x 10-3/4" 2,700,000
Prospect 3 72 4 8-1/4" x 10-3/4" 2,500,000
Edition 4 208 4 8-1/4" x 10-3/4" 3,300,000
Prospect 4 144 4 8-1/4" x 10-3/4" 3,000,000
Edition 5 216 4 8-1/4" x 10-3/4" 3,300,000
Prospect 5 144 4 8-1/4" x 10-3/4" 3,500,000
Edition 6 192 4 8-1/4" x 10-3/4" 3,400,000
Edition 7 184 4 8-1/4" x 10-3/4" 3,300,000
Women's Catalog
---------------
Women's 1 96 4 7-5/8" x 10" 1,400,000
Women's 2 96 4 7-5/8" x 10" 1,400,000
Women's 3 96 4 7-5/8" x 10" 1,400,000
Women's 4 72 4 7-5/8" x 10" 1,500,000
College Catalogs
----------------
Catalog 1 64 4 9-1/8" x 11-3/8" 1,600,000
Catalog 2 64 4 9-1/8" x 11-3/8" 1,700,000
Catalog 3 64 4 9-1/8" x 11-3/8" 2,100,000
1998 Total Pages (Pages times Quantity and then totaled) = 9,198,200,000
------------------------------------------------------------------------
The above specifications summarize the projected 1998 catalog
program. For 1999, 2000 and 2001 the schedule is to be calendar
adjusted, taking into account refinements that occur in response
to changes in market conditions and your budgetary process. These
refinements could consist of changes to quantity, page counts,
versions and possibly cancellations. It is understood that the
volume in 1999, 2000 and 2001 will be at a minimum equivalent to
that projected for 1998 as set out above. Volume is described as
the printed pages multiplied by the total count as described
above.
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J. Crew, Inc. Page 4
August 14, 1997
The parties agree to an 8% (eight percent) discount on work
scheduled to start binding between January 1 and June 30 of any
year under this Agreement. This first half discount will be
applied to the Base Makeready and Run per M prices, and will not
be applied to preliminary, freight of all kinds, or bind, mail or
cylinder additionals, and will appear as an invoice credit on
each of the applicable events.
As an incentive for J. Crew Inc. to add additional work with R.R.
Donnelley & Sons Company, commencing in 1998, the parties agree
to an 8% (eight percent) volume discount structure based on an
increase in any calendar year on the projected 1998 level (pages
times quantity) set out above. This volume discount will be
applied to the Base Makeready and Run per M prices, and will not
be applied to preliminary, freight of all kinds, or bind, mail or
cylinder additionals. This volume discount will apply to all
incremental work and assumes a similar number of total square
inches of printed product.
Volume shall consist of the total number of printed pages times
total count calculated at the end of the calendar year. For the
incremental volume, a credit memo will be issued within 30 days
after each calendar year, if a growth volume incentive has been
earned. The volume discount is subject to prompt payment of all
invoices. If J. Crew pays any invoice late, RRD may elect to
reduce any growth volume incentive by the cost of money based on
the prime rate as published in Wall Street Journal plus two
percent (Prime +2%), as well as any other costs incurred to
collect late or outstanding debts.
If a volume incentive is earned at the end of the contract (or
earlier termination), a cash payment will be made 30 days after
the end of contract (or earlier termination). In determining the
amount of such payment, the value of payments due us will be
credited against the value of the volume incentive.
FORECAST
To assist us in providing for your requirements, you shall submit
a forecast by July l of each year showing your total requirements
for the subsequent calendar year for work hereunder, during the
term of this Agreement, including the count, number of pages,
colors, copies to be bound and delivery dates for each issue. We
shall, within 30 days of receipt of such forecasts, develop
manufacturing schedules for the production of the work based on
the forecasts you furnish which we shall present for your review
and approval, such approval not to be unreasonably withheld. You
shall notify us as promptly as practicable of any significant
change in the forecasted requirements. We will produce up to a
twenty-five percent (25%) annual increase (quantity multiplied by
pages and then totaled) over the preceding year for 1999, ten
percent (10%) over the preceding year for 2000, and a mutually
agreed percentage (to be determined at a later date) over the
preceding year for 2001, in accordance with the terms herein and
pursuant to a mutually agreeable production schedule and the
availability of materials. We currently have all work for your
1997 gravure body pages scheduled for production in our
Spartanburg, South Carolina Manufacturing Division, and we will
use all reasonable efforts to schedule all future gravure body
production, as described herein, in our Spartanburg plant. If in
order to meet your forecast
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J. Crew, Inc. Page 5
August 14, 1997
requirements, it is necessary to produce some, or all, of your
work elsewhere, it will be produced in a Gravure Manufacturing
Division or Divisions, and any additional production costs or
freight associated with such transfer from the Spartanburg, South
Carolina Division, will not be charged to you.
TECHNOLOGICAL IMPROVEMENTS
We will keep abreast of changes in the graphic arts industry and
will review with you developments which may be beneficial for
your titles. We will also be receptive to any suggestions you may
have for beneficial changes. If you approve of implementing such
changes, the parties will negotiate appropriate prices and
schedules to incorporate such changes into the production of your
work and to allow us to amortize our capital investment, if any.
During the term of this Agreement, we will meet with you once
every six months to discuss technological developments which have
occurred and have become commercially available for application
to the work performed by us for you, and the conditions under
which such developments would be incorporated. Any pricing
adjustments due to technological advancements and efficiencies
will also be discussed prior to the implementation of such
developments.
PRELIMINARY MANUFACTURING PROCESS
This contract is based on a common document workflow. R.R.
Donnelley will function as a client of J. Crew's QPS server and
as such will have access to shared volumes on that server. At the
proper times in the production cycle, we will "check out" the
Quark document, modify it per descriptions below, and check it
back in to the server. During the course of the contract it is
expected that the nature and timing of some operations may
change. The intent of this description is to set forth the major
responsibilities of each party that have been assumed in building
the prices.
Your file shall include all mechanical page elements such as
tints, colored or reverse type and rules. Silhouetting of
photographs and creation of key-only shadows will be performed by
us and will be charged additionally as set forth in Exhibit A.
IMAL CYCLE
----------
When you have completed the rough layout process for a
spread and it is ready for us to begin processing, you will
so indicate by changing the status to "color out". At that
point you will also furnish us with original transparencies.
Each will be accompanied by a thermal proof indicating size
and orientation, as well as instructions for silhouetting,
shadows and creation of composite images due to overlapping
silhouettes. We will produce hi-res separation to the
specifications that you direct. If you so direct, we will
separate, process and archive to a higher dpi (not to exceed
the industry standard) than was the practice in our previous
agreement at no increase in price.
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J. Crew, Inc. Page 6
August 14, 1997
We will run a preflight check and take any appropriate
corrective action to your Quark document. For each new
transparency that you furnish, we will generate a lo-res
file and place it into the appropriate Quark document,
thereby replacing any temporary lo-res image that you had
created for rough layout purposes.
For color proofing purposes, we will create and RIP a
temporary file in which, for new subjects only, the hi-res
images are substituted, and submit to you a contract
quality proof (Kodak Approval or equivalent) for your color
comments using industry standard markup language. For
pickup subjects, it is our recommendation that neither the
hi-res nor the lo- res substitute be included in the color
proof at this stage. If you so direct, we will retrieve the
hi-res pickup from archive and incorporate it into the
document. If that is the case it must be understood that
the picked up image, if it is concurrently being worked for
another edition, may not yet have been archived with OK'd
color. Also, any additional color markup resulting from
that circumstance, giving you an earlier opportunity to
view the hi-res pickup on the color proof will be charged
as a "color alteration to retrieved image" per the contract
price schedule.
PAGE CYCLE
----------
When the document has been updated to J. Crew's
satisfaction, you will so indicate by changing the status
to "type out" and furnish us with a thermal proof that will
serve as the OK for type and margins. We will color correct
to the marked-up IMAL proof, run a preflight check and take
any appropriate corrective action to the Quark document.
For each composite image, we will supply a lo-res of the
composite to be substituted for the original lo-res files
in the document.
For color proofing purposes, we will create and RIP a
temporary file in which all hi-res images are substituted,
and submit to you a contract quality proof for color OKs
and two color photocopies of each color proof for your use.
These copies will not be stamped as authorized proofs, nor
will we do any proofreading at this stage. There will be a
sign off on each proof which will indicate J. Crew's
acceptance of this page.
DATA CYCLE
----------
When the document has been updated to J Crew's
satisfaction, you will so indicate by changing the status
to "spread proof revise" and furnish us with a thermal
proof that will serve as the OK for type and margins. We
will color correct to the marked-up page proof, run a
preflight check and take any appropriate corrective action,
including trapping fixes and the spreading of knockout type
whenever needed.
We will RIP the document file, substituting all the hi-res
images, and produce a contract proof for press guidance. We
will make a color photocopy of each color proof to serve as
OK's for type and mechanical elements and margins.
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J. Crew, Inc. Page 7
August 14, 1997
Any additional proofing to that which is described above
will be charged as an extra.
Not withstanding the above, if J. Crew, the Lancaster
Preliminary Center, and Spartanburg agree that it would be
mutually beneficial to provide additional preliminary
proofing to that which is described above, we will do so at
no charge to J. Crew.
ALTERATIONS
-----------
Any re-processing of a file that requires changes that
include (but are not limited to) building composite images
and recreating shadows due to position and size changes
will be considered to be alterations and will be charge
additional.
'MAXIMUM CHARGE' AND PAGE DESIGN
--------------------------------
The "Maximum charge" four-color page price is included in
this Agreement with the expectation that the average
difficulty of a J. CREW page (as compared to the
Fall/Winter 1996 and Spring/Summer 1997 catalog seasons)
will not increase during the term of this agreement. If at
any time the design for a particular event causes a
significant increase in the number of pages that qualify
for the "maximum charge" we will honor the price for that
event but we reserve the right to request a review of
future design plans to determine if the design for the
event in question will be carried forward to future events.
If a new, more complex design does become permanent, we
mutually agree to re-negotiate the "maximum charge" price
or to establish a limitation on how frequently this price
may be utilized.
SCHEDULE
--------
Our schedules have four flow cutoff dates. If these four
flow cutoff dates are not maintained, we will do our best
to maintain the schedule but upon prior notification to J.
Crew, we reserve the right to limit the color proofing on
some pages to one cycle if that is necessary to maintain
your mailing date.
Likewise, if we receive any pages more than four days after
any of the four scheduled cutoff dates, upon prior
notification to J. Crew, we reserve the right to modify
proofout dates and to charge additional for overtime costs
if those costs must be incurred in order to maintain the
mailing date. Overtime for lateness will not be charged on
the cover forms provided that presswork schedule
adjustments can be made at the cover plant of manufacture.
ARCHIVING
---------
We will store both random images and final page files in
separate archives.
We will maintain a library of random images, which you will
OK for color after viewing on an IMAL proof. We will, as a
rule of thumb, archive an area up to one inch beyond
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J. Crew, Inc. Page 8
August 14, 1997
the cropping point set up in the document during the IMAL
cycle. When one of these images is retrieved for a
subsequent catalog, any color adjustment that is requested
will be charged additionally as a "color alteration to
retrieved image".
If an archived image has not been retrieved for a period of
thirteen months it will be deleted from the archive.
We will store final page files for a minimum of three
months, or as long after that as we believe is necessary
for internal backup purposes. In the event that we are
unable to reproduce a page which we were obligated to
retain in storage, we will pay the cost of transporting
duplicate material to us as well as the cost of reproducing
the page including the cost of duplicating the
transparencies and similar out-of-pocket costs. We will not
be liable for the cost of creating the page such as
re-shooting any photographs.
TELECOMMUNICATIONS
------------------
J. Crew and R.R. Donnelley agree to provide mutually
satisfactory data transmission capability at all times.
Specifically, each party agrees to provide and maintain the
means by which the other may access required data without
unreasonable delays in throughput. If at some time it is
agreed that the transmission capability must be increased,
both companies acknowledge that a corresponding increase
must be made at each company's end of the network
connection, and that each company will be responsible for
any additional expense incurred thereby.
ADS AND OTHER MISCELLANEOUS PROJECTS
------------------------------------
We agree, subject to mutually agreeable scheduling, to
perform separation work for J. Crew work other than the
principal catalog events, and we will maintain the image
archives in such a manner as to allow us to do so as
economically as possible. We have included prices for
this work to the extent that we are familiar with in but
will quote additional prices as other projects develop.
The prices in the "ad pages" section are based on
continuing the traditional workflow. It is, however, more
economical for us to operate within the new QPS-based
workflow that prevails for the catalog work. If and when
the ad work moves to the new workflow, the "ad pages", the
catalog price schedule will apply in place of the "ad
pages" price schedule.
CANCELLATION
------------
Both parties agree that it is the full intent of each that
we shall continue to provide the majority of preliminary
services for your catalogs. We shall be obligated and
entitled to produce a minimum of 80% of your total catalog
pages as described in this agreement for your 1998
Spring/Summer and Fall/Winter Catalog Program and a minimum
of 67% of
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J. Crew, Inc. Page 9
August 14, 1997
you total catalog pages for your 1999 and 2000
Spring/Summer and Fall/Winter Catalog programs and 2001
Spring/Summer program.
You will notify us in writing on or before July 1 of 1998,
1999 and 2000 with your forecast of preliminary pages to be
produced by us for the following years Spring/Summer and
Fall/Winter catalog program. This forecast will be at least
67% of your total catalog pages and can be as high as 100%
of total pages for your 1999, 2000 and 2001 program. We
shall within 30 days of receipt of your preliminary
services forecast, develop manufacturing schedules which we
shall present for your review and approval. Our
obligation to produce work for your 1999, 2000 and 2001
programs will be based on the percentage indicated in your
July 1 written notification. Any increases requested after
July 1 of each year will be made on a best effort basis.
Both parties agree to an ongoing review of our joint
experience with the preliminary operation of your work and
as a result of such review, either party may elect to have
you (J. Crew) furnish all preliminary, film or digital
data, for all remaining catalogs under this agreement.
Notification by either party must be received in writing by
either party 12 months prior to the first art in date of
any season.
PRESSWORK
The body to be carefully made ready and printed by the gravure
process in our standard four- color process inks. The cover is to
be carefully made ready and printed by the web offset or gravure
process in our standard four-color process inks. The run per M
prices quoted in Exhibit A are based on the ink coverage
demonstrated by your 1996 catalog program. There shall be no
change in the charges for ink due to changes in coverage unless
such change in either offset or gravure coverage persists over a
year's experience and can be objectively and reasonably
demonstrated to be different from the coverage used to determine
pricing.
CUSTOMER FURNISHED PAPER
You shall furnish f.o.b. our plant of manufacture all paper
required for the printing of your program in the weights, kinds
and sizes set forth herein or as we shall otherwise mutually
agree upon in accordance with a mutually agreeable delivery
schedule and in sufficient time to meet the production schedule.
Paper shall be delivered to us in rolls with steel or fiber
cores, unless otherwise mutually agreed upon, to the
specifications listed on Exhibit C, properly wrapped and wound
with pasters plainly flagged. Returnable cores shall remain your
property and shall be returned by us in accordance with your
directions at your expense (currently upon completed load of rail
car). We shall reimburse you for the cost of any returnable cores
received by us for the work and not returned by us to the mills
from which such cores were shipped.
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J. Crew, Inc. Page 10
August 14, 1997
All paper furnished by you shall be of good printing quality and
shall conform to a standard of mechanical quality, as agreed to
by you, us and the paper supplier, suitable for efficient
performance of the work. If at your request we use paper not
acceptable to us and our cost is increased due to the use of such
paper, we shall notify you, and follow up with written
documentation, and we shall make an additional charge to fairly
compensate us for such increased costs.
Paper not conforming to specifications, concealed damage and
defective paper shall be rejected by us, reported promptly to
you, and held for your instructions as to the disposition
thereof. Should you require us to use defective paper or paper
not conforming to specifications and should we incur additional
costs as a result of the use of such paper, we shall charge you
an amount fairly reflecting such additional costs directly caused
by use of such paper including, without limitation,
overconsumption of paper. Without limiting the foregoing, it is
agreed that paper causing significant press slowdowns, or causing
more than a ratio of three (3) proven paper caused web breaks per
one-hundred (100) rolls of each type of paper and basis weight
furnished by you within a series identified as a month's
production of the mill shall not be considered of suitable
mechanical quality and that to the extent the paper falls below
this standard we shall be entitled to make an additional charge
as aforesaid. Such charge will include additional paper
requirements and press down time as described in Exhibit A.
Should you furnish or request we use paper which is designed for
use in another printing process than that set forth in this
Agreement, we will make every reasonable effort to utilize such
paper, it being understood that any additional costs directly
resulting from the use of such paper in producing an acceptable
product will be your responsibility, including, without
limitation, overconsumption of paper.
We shall further submit to you written reports regarding any
defective paper or paper received in a damaged condition as soon
as reasonable practicable after the damage shall have been
discovered. In the case of any paper received in a damaged
condition, we shall prepare affidavits describing such damage for
you. We shall give you all such assistance as you may reasonably
request to assist you in recovering for such damage or defect.
If upon termination of this Agreement we have any of your unused
paper on hand, it is understood and agreed that you will accept
billing for all charges reasonably incurred by us, involved for
disposition of such paper, in accordance with your instructions,
including handling and storage charges as set forth in Exhibit A.
We will make a seasonal accounting and reconciliation, and a per
issue report of all paper furnished by you under this contract
upon completion of each season. Such accounting will show the
paper received, paper consumed and paper requirements based on
the contract allowances specified herein, as adjusted for light
and/or heavy paper, wrapper, header, fiber cores, and damaged
(claimed or concealed) or other defective paper.
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J. Crew, Inc. Page 11
August 14, 1997
Should the total paper consumption in any accounting period, as
defined above, exceed the contract allowances specified herein,
adjusted as described above, we will pay for such excess at the
average cost of each kind of paper for such accounting period.
Should the total paper consumption during any such period be less
than the paper requirements adjusted as described above, you
shall pay us an a mount equal to one-half the cost of said paper
so saved. In determining the amount of such payment, the value of
underconsumption, if any, on one kind of paper will be credited
against overconsumption, if any, on other kinds of paper used in
the same accounting period (except the cover paper and body paper
will be handled separately). The average cost of the body paper
shall be calculated based on a 12 month average of 40#
Publication Coated Grade #5 paper, or the applicable paper if
different as indicated in the "Price Watch" report in Miller
Freeman Publication, Inc.'s Pulp and Paper Weekly Magazine.
Any paper saved due to underconsumption, and damaged or other
unusable paper, will remain your property. We will charge for
storage on all such paper, in excess of the storage allowances
described below, until used or disposed of, and will make an
additional charge to fairly compensate us for disposition of such
paper if not used.
All manufacturing waste, or other waste will become our property.
We will store your body paper requirements for each event up to
thirty (30) days prior to the "to press date" at no additional
charge. Should you exceed these limits, we will charge you for
paper storage at the rate set forth in Exhibit A, or at the
prevailing rates at another location including applicable
handling and freight, for the amount of paper which exceeds the
limits.
We will store your cover paper requirements for each event up to
twenty one (21) days prior to the "to press date" at no
additional charge. Should you exceed these limits, we will charge
you for paper storage at the rate set forth in Exhibit A, or at
the prevailing rates at another location including applicable
handling and freight, for the amount of paper which exceeds the
limits.
If R.R. Donnelley recognizes that storage outside the division
will be required, R.R. Donnelley will use best efforts to notify
J. Crew in a timely manner to avoid double handling and
additional freight.
BINDING
We will gather press delivered signatures, along with your
furnished inserts, saddlewire stitch and trim flush three sides
for delivery upon completion f.o.b. our plant of manufacture.
You are to furnish inserts f.o.b. our plant of manufacture in
accordance with the production schedule and to our specifications
ready for binding. We require an additional allowance for binding
and we shall submit such waste percentage (which shall be
consistent with the representative chart below) sufficiently in
advance of the binding date.
Should you furnish us and require us to use furnished inserts
which do not conform to our specifications as set forth in
Exhibit C, we will make every reasonable effort to utilize such
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J. Crew, Inc. Page 12
August 14, 1997
inserts. Should we incur additional costs as a result of the use
of such inserts, we will charge you an amount fairly reflecting
such additional costs.
On Line Selectronically(R)
25,000 or Less: Double the Quantity
25,001 to 50,000 25% Extra
50,001 to 100,000 15% Extra
100,001 to 250,000 10% Extra
Over 250,000 3.5% Extra
Non Selectronic(R)
20,000 or Less: 20% or at least 1,000 extra
20,001 to 50,000 10% Extra
50,001 to 100,000 5% Extra
Over 100,000 3.5% Extra
DISPOSITION
We will address your catalog (and order blank) using our
SELECTRONIC(R) addressing service (with one address up to 8
lines) to our specifications which we will submit, bag copies and
mail.
You are to furnish ink-jet formatted magnetic tapes that are
compatible with our equipment, in PASS sequence and in accordance
with specifications we will furnish. We will process the tape to
do 3-tier sortation and to add the necessary ink-jet codes, make
sack tags, generate instructions to the bindery and print a
summary for postal charges at the rates set forth in Exhibit A.
Any reformatting, coding, combining of lists or other required
work necessary for our use of your furnished tapes, will be
charged additional after your agreement has been obtained for
such work. Any double stroking (two hits of ink) to create bold
face type will be additional.
Our price is based on mailing from lists of 150,000 names or
more. Additional charges will be applied for lists of less than
these minimums.
Any requested bar-coding of mail catalogs to obtain postal
discounts will be charged additional at our prices set forth in
Exhibit A.
The mailing prices set forth herein are based upon postal
regulations and procedures in effect as of the date hereof which
require mandatory Zip-code sortation. If postal regulations or
procedures change so as to affect our cost for mailing the
catalogs, the prices herein shall be revised to fairly reflect
any increase or decrease in such costs.
Nothing contained herein shall require us to do anything in
violation of United States Postal laws, regulations or
procedures.
<PAGE>
J. Crew, Inc. Page 13
August 14, 1997
Any other required labels shall be furnished by you to our
specifications.
Any requested shipping of mail catalogs to various postal
facilities to obtain postal discounts will be charged additional
at our prices set forth in Exhibit A. These prices will include,
but not be limited to, freight and administration charges.
In the event we move production of any J. Crew work from our
Spartanburg Manufacturing Division, we will pay the additional
costs of distributing your product, caused by such move, if any,
net of freight savings caused by the change in manufacturing
location.
All copies are for delivery upon completion f.o.b. our plant of
manufacture.
PRICES
You shall pay us for the work at the applicable prices set forth
in Exhibit A, which is attached hereto and made a part hereof.
FREIGHT
Unless you request otherwise, we will arrange for shipment of
your finished materials from our plant of manufacture. In such
event, you shall pay all distribution charges, and we shall be
entitled to retain any brokerage commissions or other service
charges earned by us or our wholly-owned subsidiaries.
DISCONTINUANCE OF PUBLICATION
Should you decide to discontinue the publication of Catalog
program in any medium without publishing a successor, whether
titled the same or not, you shall use your best efforts to give
us 90 days advance written notice of such decision. Without
limiting the foregoing, you shall be obligated to pay for work
done or in process. In addition, you shall reimburse us for costs
which we cannot avoid through reasonable effort, which we will
document to your satisfaction. No equipment holding time will be
charged if you give us 90 days notice of discontinuance.
CHANGE IN MEDIUM
In the event that you replace the medium used for your products,
we shall have the first right of negotiation to produce the work
for you in the new medium during the remaining term of this
Agreement provided that our prices are competitive with the
market for the new medium at the time you make such change.
SALE OF CATALOG
We recognize that you may want to sell the catalog under
circumstances and on a time schedule which cannot be predicted
and we will use our best efforts to help you with such a sale. If
circumstances permit you to inform us of the identity of your
prospective purchaser as soon as
<PAGE>
J. Crew, Inc. Page 14
August 14, 1997
practicable before you agree to sell the catalog, we will keep
such information strictly confidential and will conduct our
investigation on such purchaser as quickly and confidentially as
possible to determine whether we wish to print for such
prospective purchaser. We will not unreasonably withhold our
consent. If circumstances do not permit you to inform us of the
identity of your prospective purchaser before you agree to sell
the catalog, you agree to bring this paragraph to the attention
of the purchaser and to require the purchaser to assume your
obligations under this agreement if we wish to print for your
purchaser. We will conduct our investigation of the purchaser as
quickly as possible to inform you whether we wish to print for
such purchaser and we will not withhold our consent unreasonably.
If any issue of the catalog needs to be produced between the
effective date of such sale and the time we notify you whether we
will print for your customer, the parties agree to use their best
efforts to resolve any credit or content issued which arise
during such interim period. In the event we are unwilling to
print for such purchaser for financial reasons, the parties agree
to use their best efforts to find another supplier or to come to
interim terms for us to continue to produce the catalog with
financial assurances from you until another supplier can assume
production. You recognize that we consider both reputation and
credit standing in choosing our customers.
OWNERSHIP OF FILM, COPY, PLATES, CYLINDERS, ETC.
Copy and any film furnished by you and electronic data files
derived therefrom will be used solely for your work and will
remain your property. Film, prints, plates and cylinders that we
make will be used solely for your work but will remain our
property. We will only use your text and images for your work.
Upon termination of this agreement you may choose to assume
possession of those files which we have in storage. In that
event, you will provide us with equivalent replacements for the
optical disks (or other storage medium, or a mutually agreed upon
dollar equivalent) on which the data is stored.
SPECIFICATIONS AND PRODUCTION SCHEDULE
All work to be performed hereunder shall be in accordance with
the specifications set forth herein, and completed in accordance
with a production schedule which shall be submitted for your
approval.
If at any time you desire to make changes in the specifications
(including pages and count) set forth herein or in the production
schedule, we will cooperate with you in putting such changes into
effect within a reasonable period of time, provided such changes
do not have a materially adverse effect on our operations.
In the event any such change results in an increase or decrease
in the cost of performing the work, the prices for the work shall
be adjusted to fairly reflect such increase or decrease which
<PAGE>
J. Crew, Inc. Page 15
August 14, 1997
we will present for your approval, not to be unreasonably withheld.
In addition, should such change result in our inability to use
any materials on hand or ordered for you in the production of
your work, you will pay us reasonable costs associated with such
materials and their disposition.
PASSING OF TITLE
Title shall pass to you on the date of shipping of completed
production. Possession shall pass to you upon delivery f.o.b. our
plant of final manufacture.
LIEN ON PROPERTY
In the event that any sums due to us by you became past due
during the term of this agreement, we will have the right, if
necessary, to retain possession of and will have a lien on all
property owed by you and in our possession, except for your
customer mailing lists, and all work in process and undelivered
work. In the event we wish to assert our lien on your property in
our possession and you dispute whether, the sum is due, an
officer of our company shall meet in person with an officer of
your company who shall use their best efforts to resolve the
dispute within 15 days. If the dispute continues after such
meeting, you may provide us with alternative security of equal
value and we will release our lien on the original property we
had in our possession.
WORK STOPPAGES
Neither party shall be liable for delays or non-performance of
this Agreement occasioned by strikes, fires, accidents or by
causes beyond their control including, but not limited to the
unavailability of materials, utilities or fuel, however, you
shall retain your obligation to make payments in a timely manner.
In the event of material shortages, we shall use our reasonable
best efforts to assist you to find workable alternatives and
substitute materials. In the event you place all or any part of
the work elsewhere pursuant to this paragraph, you will not make
commitments for a period longer than reasonably necessary to
allow you to purchase the production of catalogs at prices equal
to or less than those set forth herein and will return such work
to us as promptly as practicable.
RESPONSIBILITY FOR SUBJECT MATTER
In furnishing us matter to reproduce or to have incorporated in
the completed product, you represent and warrant that none of
such matter (either as furnished to us by you or as altered by us
at your direction) infringes any copyright, is libelous, or
otherwise violates the rights of or will cause damage or injury
to other persons, and you agree to indemnify and save us harmless
from all losses, damages and expenses, including reasonable
attorneys' fees, which we may suffer as the result of any claim
of such violation, damage or injury.
<PAGE>
J. Crew, Inc. Page 16
August 14, 1997
QUALITY, GUARANTEE AND LIMITATION OF LIABILITY
We will perform the work in a good and workmanlike manner and in
accordance with the specifications and production schedule. The
quality of work produced under the terms of this Agreement shall
be generally equal to or better than the average work produced
for comparable work under previous agreements we have had to
produce your catalog consistent with the paper, film, art work or
other materials used in the production of the work. In the event
the work is defective or delayed due to our fault (including
negligence), we shall be liable for direct damages but we shall
not be liable for special or consequential damages, including,
but not limited to, lost profits or business as defined in the
Uniform Commercial Code engaged in the State of New York and
without regard to whether the work performed under this Agreement
would be a sale of goods or a sale of serviced under New York
law. We will use our best efforts to mitigate your damages
including reprinting or repairing any defective work as promptly
as practicable. Further, we shall not be liable for any damages,
whether direct, indirect, special or consequential, associated
with our shipment of any of your work on contract or common
carriers. Notwithstanding the preceding sentence, we will require
all contract or common carriers engaged by us to transport your
work to carry one hundred thousand dollars ($100,000.00) of cargo
insurance and will cooperate with you in filing claims if your
property is damaged in transit.
MATERIALS AND PURCHASED SERVICES
Unless otherwise provided, we will supply the materials (ink,
binding materials, etc.) or purchased services specified herein
or their equivalents. It is understood and agreed that should we
be unable to obtain such materials or services or their
equivalents in necessary quantities, the parties shall select
mutually agreeable substitute materials or services which we
shall present for your approval, not to be unreasonably withheld.
Should the use of such substitute materials or services increase
or decrease the cost of performing the work, the prices will be
adjusted to fairly reflect any such increase or decrease in cost.
The unavailability of materials or services will not be
considered a breach of this Agreement as long as we have used our
best efforts to obtain and use materials, consistent with our
obligations to other customers. Should any volume or trade
discounts be earned on materials or services, they will be
retained by us. All scrap and by-products will become our
property.
STORAGE
We will store final reproduction medium (film or electronic data
files) made by us and used in the production of your work for one
year, after which film will be destroyed and data files erased
unless otherwise agreed to and at prices to be separately quoted.
Plates and cylinders will not be held after completion of
printing of the next catalog unless confirmed by letter form us.
Storage of cylinders beyond that date is not included in the base
prices and will be charged additional as incurred at the then
current price quoted in Exhibit A. The storage will be incurred
at the start of in-home span of the following event. For example,
<PAGE>
J. Crew, Inc. Page 17
August 14, 1997
Spring Edition 1 cylinders will be stored at no charge until the
first in-home date of the Spring Edition 2.
Unless otherwise specified, the prices in this Agreement contain
no storage of paper, other materials, work in process or finished
goods beyond the production schedule span. If you delay
completion of the work or postpone delivery of finished goods
beyond the date specified in the production schedule, or if your
furnished materials arrive prior to the dates specified in the
production schedule, storage will be charged at the rates set
forth in Exhibit A for each month up to twelve months the
finished goods, work in process or furnished materials remain in
our possession.
Such rate will be doubled for each month after the first twelve
months of storage. If, following the eighteenth month of storage
we receive no direction from you as to the disposition of the
stored items, such items will be destroyed. No storage charges
will be made for delays which are largely caused by us.
PRICE ADJUSTMENTS FOR CHANGES IN EMPLOYEE COMPENSATION, COSTS
OF MATERIALS, UTILITIES, FUEL AND TAXES
The prices stated in this Agreement are based upon the cost of
direct materials and any purchased services as of June 1, 1997
and labor, utilities, fuel and indirect materials as of the date
hereof. If before completion of the work hereunder the cost of
performance is increased or decreased as the result of changes in
the rates of employee compensation, cost of employee benefits,
payroll taxes, or other working conditions or terms of
employment, or as the result of changes in the cost of materials.
purchased services, utilities or fuel (except electricity, which
will not be adjusted), the prices stated herein shall be
increased or decreased in proportion to such increase or decrease
in cost of performance. If any changes become effective after
part of the work hereunder has been done or part of the material,
utilities or fuel or services has been purchased, such adjustment
of prices shall apply only to the work done or purchases made
after such change. If we are required to pay any new or increased
excise, privilege, processing, gross receipts, or similar tax not
now imposed on account of any act required for the performance of
this Agreement, or if we are required to pay any new payroll tax
or similar charge, the cost of such new or increased tax shall be
added as an extra charge.
If any changes in the non-labor components of our prices
(excluding ink) result in an increase or decrease in our prices,
such increase or decrease will not be effective until the start
of the next Fall/Winter or Spring/Summer Season.
The prices herein shall be adjusted on the basis of changes in
labor, indirect materials, fuel and utility costs occurring at
our Lancaster Service Center for preliminary work. Lancaster West
Manufacturing Division for the body presswork and Spartanburg
Manufacturing Division for the body presswork, binding and all
remaining prices, regardless of where the work is actually
performed. and if such adjustment shall occur at the above
divisions at a time other than the
<PAGE>
J. Crew, Inc. Page 18
August 14, 1997
regularly scheduled adjustment for that decision(s), we shall not
apply that percentage increase until the next regularly scheduled
adjustment for the corresponding division(s).
Notwithstanding the foregoing, the increases in manufacturing
prices for both preliminary and printing will not exceed in the
Consumer Price Index (1982-4 = 100), all Urban Wage Earners and
Clerical Workers, U.S. City Average, published by the Bureau of
Labor Statistics, U.S. Department of Labor for the same period.
If the Consumer Price Index is revised or discontinued, this
calculation will be made using the Successor Price Index
designated by the Bureau of Labor and Statistics.
SALES AND USE TAXES
Any sales, retailer's occupation, service occupation, value
added, or use tax imposed on account of this transaction
will he added as an extra charge.
OVERTIME
If overtime is required to meet your delivery or quantity
requirements, we will use our best efforts to make any necessary
overtime available and will charge for such overtime at our then
current rates. If overtime is worked due to our internal
scheduling problems or other problems within our control arising
after a production schedule is agreed upon, and not caused by
your failure to comply with the production schedule, overtime
charges will not be made. No chargeable overtime will be worked
without your prior approval, and in the absence of such approval,
delivery of the work will be made as promptly as practicable
consistent with our then available capacity.
POSTAGE
The cost of postage and permits will be paid by you and you shall
be responsible, if necessary, for establishing an account at the
U.S. Post Office with sufficient funds to cover mailing.
ASSIGNMENT
Neither party to this Agreement shall assign any right or rights
hereunder without the prior written consent of the other party,
except that we may assign payments due us to our wholly-owned
subsidiaries without consent. You may assign this Agreement to
any wholly owned subsidiary of J. Crew Group, Inc. as long as we
receive a guarantee from J. Crew Group, Inc. Subject to this
consent, this Agreement shall inure to the benefit of and shall
bind the successors and assigns of the parties hereto.
BANKRUPTCY
If either party shall be adjudicated a bankrupt, institute
voluntary proceedings for bankruptcy or reorganization, make an
assignment for the benefit of its creditors, apply for or consent
to the appointment of a receiver for it or its property, or admit
in writing its inability to pay its debts as
<PAGE>
J. Crew, Inc. Page 19
August 14, 1997
they become due, the other party may terminate this Agreement by
written notice. Any such termination shall not relieve either
party from any accrued obligations hereunder.
EDITING OF COPY
The price quoted does not, unless otherwise stated, include the
editing of copy.
INSURANCE
We will carry at our expense fire, sprinkler leakage and extended
coverage insurance, subject to the usual exclusions, limitations
and conditions of such policies, on the actual cash value of all
our materials, work in process, and all production completed and
not shipped, and on the actual cash value of all positives, copy,
artwork, paper and other materials furnished by you, while in our
care, custody and control. Such insurance shall cover loss of,
damage to or destruction of such property caused by the perils of
fire, lighting, windstorm, hail, explosion, riot, riot attending
a strike, civil commotion, aircraft, vehicles, smoke, vandalism,
malicious mischief and sprinkler leakage, subject to the usual
exclusions of fire and extended coverage policies. If your
property is damaged as a result of an insured peril under the
applicable insurance policy, then, at our option, we will either
replace your damaged property or reimburse you for the actual
cash value of the damaged property. If we elect to reimburse you
for the damaged property's actual cash value, the amount payable
to you shall be limited to the proceeds of such policy plus any
related deductible, if any, applied to the claim for damage to
your property. For positives and other media our insurance
coverage and other liability shall be limited to the cost of
blank film or other media and the cost of duplication from an
original or other copy.
We will advise you of any material changes in our insurance
coverage. We will provide you a certificate of insurance in
force.
If the damaged property is catalogs, they will be replaced by
similar catalogs.
GOVERNING LAW
This Agreement shall be governed by the laws of the State of New
York.
OVERRUNS AND UNDERRUNS
Variations in quantity of zero percent (0%) more or less than
quantities ordered will constitute acceptable delivery, and the
price will be adjusted at the over/under delivery per thousand
copy price. If the work involves more than one version, the
over/under percent for each version shall depend upon ordered
quantity of that version, as separately quoted.
TERMS OF PAYMENT
Net cash sixty-five (65) days from the date of invoice. An
invoice for all materials, preliminary, presswork and initial
binding charges will be issued on completion of the first binding
lot.
<PAGE>
J. Crew, Inc. Page 20
August 14, 1997
Charges for any subsequent binding lots will be invoiced
upon completion. All payments must be received at our lock box no
later than the sixty-fifth (65th) day from date of invoice. We
will charge interest at the rate of 1-1/2% per month on any
unpaid invoices after sixty-five (65) days. Our obligation to
perform work hereunder is subject to the validity and continued
effectiveness of guaranty of Popular Services, now known as J.
Crew Group, Inc. dated December 5, 1988.
INTEREST AND COLLECTION COSTS
Our obligation to perform work hereunder is subject to prompt
payment of all invoices pursuant to the terms of this and other
agreements we may have with you. Should any invoice issued
hereunder become past due, you agree to pay interest at the rate
equal to the prime rate announced by Citibank for three month
loans to its most credit-worthy customers (the "Prime Rate") plus
three percent (3%) per year, or the lawful limit if less, on all
amounts past due. Progress billing of interest due or failure to
bill for interest due shall not constitute a waiver of our right
to charge interest on all amounts past due to the date payment is
received.
If you fail to pay our invoice in accord with these terms, you
agree to pay all costs of collection, including but not limited
to, reasonable attorneys' fees (if the full amount of the invoice
is ultimately determined or admitted to be due or a pro rated
amount of such costs of collection if less than the full amount
is ultimately determined to be due by you to us).
Should any portion of any invoice become disputed, you agree to
pay the undisputed portion according to its terms and you will
notify us promptly of the dispute. Both parties agree to use
their best efforts to resolve the disputed portion of such
invoice within thirty (30) days of learning of the dispute.
Interest shall accrue on disputed amounts at a rate equal to the
"Prime Rate" described above if such amounts are ultimately
determined or admitted to be due.
CREDIT REVIEW
If you delay completion of manufacture beyond the period
contemplated by the production schedule or if partial payment is
made prior to the completion of the entire quantity, interim
billing may be made. The above provisions may be reviewed by us
and should there be a substantial adverse change in your credit
standing or in the event that you do not comply with the terms of
these provisions, we will have the right to change the terms of
payment. and our obligation to perform further work will be
subject to reaching mutual agreement on revised terms.
WAIVER
No waiver by either party hereto of any default by the other in
the strict and literal performance of or compliance with any
provision, condition, or requirement herein shall be deemed to be
a waiver of, or in any manner release such other party from,
strict compliance with any provision, condition or requirement in
the future; nor shall any delay or omission of either party to
exercise any right of termination or the right hereunder in any
manner impair the exercise of any such
<PAGE>
J. Crew, Inc. Page 21
August 14, 1997
right accruing to it thereafter. Except when otherwise expressly
stated, no remedy expressly granted herein to either party in the
event of a default by the other shall be deemed to exclude any
other remedy which would otherwise be available.
NO JOINT VENTURE
Nothing herein contained shall in any way constitute a
partnership between, or joint venture by, the parties hereto or
be construed to evidence the intention of the parties to
constitute such. Neither of the parties shall hold itself out
contrary to the terms of this paragraph by advertising or
otherwise, and neither party shall be or become liable or hound
by any representation, act or omission whatsoever of the other
party contrary to the provisions of this paragraph.
EXHIBITS
This Agreement includes the following Exhibits which are attached
hereto and made a part hereof:
EXHIBIT A - PRICE SCHEDULE
EXHIBIT B - PAPER SPECIFICATIONS
EXHIBIT C - OUTSIDE SUPPLIED PARTS REQUIREMENTS
IN WITNESS WHEREOF, the parties have caused their authorized
officers to sign this agreement as of the date written above. If
this Agreement is signed by both parties on or before August 18,
1997, it shall take effect with all work produced as of the 1997
Fall/Winter Edition 1 Catalog.
RR DONNELLEY & SONS COMPANY
By:_________________________________________
Joe Lawyer
Merchandise Media business Unit President
J. CREW Inc.
By:_____________________________
Authorized Officer
Date:_____________________, 1997
<PAGE>
J. Crew, Inc. Page 1
Exhibit A - Price Schedule 8/14/97
PART I - PRESSWORK PRICING
--------------------------
Presswork Prices (Presswork, Binding, Disposition and Ink). These
prices include 1 (one) base version. No storage (other than set
forth in the clauses entitled "Customer Furnished Paper"
"Storage") is included. Interplant freight to ship covers from
Lancaster to Spartanburg is included in our prices.
A. 8-1/4" x 10-3/4" OFFSET COVER OPTIONS Makeready Run/M
-------------------------------------
4-page offset cover..................... $ 2,067.00 $ 5.13
8-page offset cover .................... 2,067.00 9.60
B. 8-1/4" x 10-3/4" GRAVURE BODY OPTIONS
45-page gravure body.................... $ 13,800.00 $ 57.70
56-page gravure body.................... 23,795.00 66.75
64-page gravure body.................... 23,795.00 70.79
72-page gravure body.................... 13,800.00 85.34
80-page gravure body.................... 27,600.00 83.88
84-page gravure body.................... 13,800.00 90.65
88-page gravure body.................... 23,795.00 93.42
92-page gravure body.................... 33,790.00 95.20
96-page gravure body.................... 13,800.00 93.97
100-page gravure body................... 33,790.00 103.24
104-page gravure body................... 23,795.00 103.01
108-page gravure body................... 23,795.00 103.78
112-page gravure body................... 23,795.00 107.06
116-page gravure body................... 23,795.00 111.83
120-page gravure body................... 23,795.00 113.60
124-page gravure body................... 33,790.00 116.87
128-page gravure body................... 27,600.00 120.14
132-page gravure body................... 33,790.00 123.42
136-page gravure body................... 23,795.00 129.69
140-page gravure body................... 33,790.00 131.46
144-page gravure body................... 27,600.00 130.23
148-page gravure body................... 33,790.00 139.50
152-page gravure body................... 37,595.00 139.25
156-page gravure body................... 37,595.00 140.05
160-page gravure body................... 37,595.00 143.32
164-page gravure body................... 37,595.00 148.09
168-page gravure body................... 37,595.00 149.86
172-page gravure body................... 47,590.00 153.74
176-page gravure body................... 41,400.00 156.41
180-page gravure body................... 47,590.00 162.78
184-page gravure body................... 37,595.00 168.45
<PAGE>
J. Crew, Inc. Page 2
Exhibit A - Price Schedule 8/14/97
PART 1- Presswork Pricing (continued)
-------------------------
B. 8-1/4" x 10-3/4" GRAVURE BODY OPTIONS (continued)
-------------------------------------
188-page gravure body................... 47,590.00 170.82
192-page gravure body................... 27,600.00 169.60
196-page gravure body................... 47,590.00 178.87
200-page gravure body................... 37,595.00 178.64
204-page gravure body................... 37,595.00 181.41
208-page gravure body................... 37,595.00 184.68
212-page gravure body................... 37,595.00 189.46
216-page gravure body................... 37,595.00 191.23
220-page gravure body................... 47,590.00 194.60
224-page gravure body................... 41,400.00 198.77
228-page gravure body................... 47,590.00 202.14
232-page gravure body................... 37,595.00 208.32
236-page gravure body................... 47,590.00 210.19
240-page gravure body................... 41,400.00 208.86
Paper Handling (all formats) per cwt.... - -
Excess Paper Storage (all formats):
First applicable month or fraction thereof
per cwt................................ - 0.40
Each additional month or fraction thereof
per cwt................................ - 0.13
Press down time, per hour, (all formats) - 547
C. FURNISHED PAPER REQUIREMENTS: 8-1/4" x 10-3/4"
----------------------------------------------
Cover Options Makeready Run Lbs.
------------- Lbs. per 1,000
25 x 38-60# --------- ---------
4-page offset cover..................... 1,190 27.17
8-page offset cover..................... 1,190 54.34
Cover Versioning (Based on 4 or 8 page cover)
Black plate change, one side of web 560
Black plate change, both sides of web 642
Four-color change, one side of web 824
Four-color change, both sides of web 1,190
<PAGE>
J. Crew, Inc. Page 3
Exhibit A - Price Schedule 8/14/97
Cover Options
-------------
25 x 38-70#
4-page offset cover..................... 1,388 31.69
8-page offset cover..................... 1,388 63.39
Cover Versioning (Based on 4 or 8 page cover)
Black plate change, one side of web 653
Black plate change, both sides of web 750
Four-color change, one side of web 961
Four-color change, both sides of web 1,388
Body Options Makeready Run Lbs.
------------ Lbs. per 1,000
25 x 38 - 38# -------------------------
48-page gravure body.................... 10,201 194.91
56-page gravure body.................... 15,301 228.31
64-page gravure body.................... 15,301 259.88
72-page gravure body.................... 7,650 292.37
80-page gravure body.................... 20,402 324.85
84-page gravure body.................... 8,926 341.09
88-page gravure body.................... 14,451 357.34
92-page gravure body.................... 19,552 373.58
96-page gravure body.................... 10,201 359.82
100-page gravure body................... 19,552 406.07
104-page gravure body................... 15,301 423.22
108-page gravure body................... 15,301 438.55
112-page gravure body................... 15,301 454.79
116-page gravure body................... 14,451 471.04
120-page gravure body................... 15,301 487.28
124-page gravure body................... 20,402 503.52
128-page gravure body................... 20,402 519.76
132-page gravure body................... 20,402 536.01
136-page gravure body................... 14,451 552.25
140-page gravure body................... 19,552 568.49
144-page gravure body................... 20,402 584.73
148-page gravure body................... 19,552 600.98
152-page gravure body................... 25,502 618.13
156-page gravure body................... 25,502 633.46
160-page gravure body................... 25,502 649.70
164-page gravure body................... 24,652 665.95
<PAGE>
J. Crew, Inc. Page 4
Exhibit A - Price Schedule 8/14/97
C. FURNISHED PAPER REQUIREMENTS:
8-1/4" x 10-314" (Continued)
168-page gravure body................... 17,852 682.19
172-page gravure body................... 30,603 698.43
176-page gravure body................... 30,603 714.67
180-page gravure body................... 30,603 730.92
184-page gravure body................... 24,652 747.16
188-page gravure body................... 29,753 763.40
192-page gravure body................... 20,402 779.64
196-page gravure body................... 29,753 795.89
200-page gravure body................... 25,502 813.04
204-page gravure body................... 25,502 828.37
208-page gravure body................... 25,502 844.62
212-page gravure body................... 24,652 860.86
216-page gravure body................... 25,502 877.10
220-page gravure body................... 30,603 893.34
224-page gravure body................... 30,603 909.59
228-page gravure body................... 30,603 925.83
232-page gravure body................... 24,652 942.07
236-page gravure body................... 29,753 958.31
240-page gravure body................... 30,603 974.56
Gravure Body Versions (Per press form):
Narrow Web
One-color cylinder change,
one side of web................... 547
One-color cylinder change,
both sides of web................. 911
Four-color cylinder change,
one side of web................... 1,640
Four-color cylinder change,
both sides of web................. 5,100
Gravure Body Versions (Per press form):
Wide Web
One-color cylinder change,
one side of web................... 1,094
One-color cylinder change,
both sides of web................. 1,822
Four-color cylinder change,
one side of web................... 3,280
Four-color cylinder change,
both sides of web................. 10,200
D. 7-5/8" x 10" OFFSET COVER OPTIONS Makeready Run/M
---------------------------------
4-page offset cover............... $ 2,067.00 $ 5.13
8-page offset cover............... 2,067.00 9.60
E. 7-5/8" x 10" GRAVURE BODY OPTIONS
---------------------------------
48-page gravure body.............. $13,800.00 $ 56.15
<PAGE>
J. Crew, Inc. Page 5
Exhibit A - Price Schedule 8/14/97
52-page gravure body.............. 19,990.00 65.63
56-page gravure body.............. 19,990.00 68.61
60-page gravure body.............. 23,795.00 65.59
64-page gravure body.............. 23,795.00 68.57
68-page gravure body.............. 23,795.00 73.05
72-page gravure body.............. 23,795.00 74.53
76-page gravure body.............. 33,790.00 78.01
80-page gravure body.............. 27,600.00 80.49
84-page gravure body.............. 33,790.00 83.97
88-page gravure body.............. 23,795.00 89.45
92-page gravure body.............. 33,790.00 91.43
96-page gravure body.............. 13,800.00 89.41
F. FURNISHED PAPER REQUIREMENTS: 7-5/8" x 10"
------------------------------------------
Cover Options Makeready Run Lbs.
------------- Lbs. : per 1,000
25 x 38-60# ----------------------
4-page offset cover..................... 1,190 25.43
8-page offset cover..................... 1,190 50.86
Cover Versioning (Based on 4 or
8 page cover)
Black plate change, one side of web 560
Black plate change, both sides of web 642
Four-color change, one side of web 824
Four-color change, both sides of web 1,190
Cover Options
-------------
25 x 38-70#
4-page offset cover............... 1,388 29.67
8-page offset cover............... 1,388 59.34
Cover Versioning
(Based on 4 or 8 page cover)
Black plate change,
one side of web 653
Black plate change,
both sides of web 750
Four-color change,
one side of web 961
Four-color change,
both sides of web 1,388
<PAGE>
J. Crew, Inc. Page 6
Exhibit A - Price Schedule 8/14/97
Body Options Makeready Run Lbs.
------------ Lbs. per 1,000
25 x 38 - 38# ------------------------
48-page gravure body.................... 5,033 173.73
52-page gravure body.................... 9,227 188.20
56-page gravure body.................... 9,227 202.68
60-page gravure body.................... 10,066 217.16
64-page gravure body.................... 10,066 231.63
68-page gravure body.................... 9,227 246.11
72-page gravure body.................... 10,066 260.59
76-page gravure body.................... 15,099 275.06
80-page gravure body.................... 8,389 289.54
84-page gravure body.................... 15,099 304.02
88-page gravure body.................... 9,227 318.50
92-page gravure body.................... 14,261 332.97
96-page gravure body.................... 10,066 347.45
G. 9-1/8" x 11-3/8" GRAVURE COVER OPTIONS Makeready Run/M
--------------------------------------
4-page gravure cover.................... $ 9,995.00 $ 8.50
H. 9-1/8" x 11-3/8" GRAVURE BODY OPTIONS
-------------------------------------
48-page gravure body.................... $ 9,995.00 $ 65.84
52-page gravure body.................... 19,990.00 72.54
56-page gravure body.................... 19,990.00 75.74
60-page gravure body.................... 19,990.00 78.44
64-page gravure body.................... 19,990.00 80.64
68-page gravure body.................... 19,990.00 85.84
72-page gravure body.................... 19,990.00 88.04
76-page gravure body.................... 29,985.00 91.74
80-page gravure body.................... 19,990.00 101.44
84-page gravure body.................... 29,985.00 99.14
88-page gravure body.................... 19,990.00 105.84
92-page gravure body.................... 29,985.00 108.04
96-page gravure body.................... 19,990.00 110.24
I. FURNISHED PAPER REQUIREMENTS: 9-1/8"x 11-3/8"
----------------------------------------------
Cover Options Makeready Run Lbs.
------------- Lbs. per 1,000
25 x 38-60# ----------------------
4-page gravure cover.................... 3,125 31.70
<PAGE>
J. Crew, Inc. Page 7
Exhibit A - Price Schedule 8/14/97
Body Options Makeready Run Lbs.
------------ Lbs. per 1,000
25 x 38- 38# ----------------------
48-page gravure body.................... 5,937 226.88
52-page gravure body.................... 10,885 245.79
56-page gravure body.................... 11,874 265.05
60-page gravure body.................... 11,874 283.60
64-page gravure body.................... 11,874 302.51
68-page gravure body.................... 10,885 321.42
72-page gravure body.................... 11,874 340.32
76-page gravure body.................... 17,811 359.23
80-page gravure body.................... 9,895 378.14
84-page gravure body.................... 17,811 397.04
88-page gravure body.................... 10,885 415.95
92-page gravure body.................... 16,822 434.86
96-page gravure body.................... 11,874 453.77
J. 8-1/4" x 8-1/4" OFFSET COVER OPTIONS Makeready Run/M
------------------------------------
4-page offset cover..................... $ 2,067.00 $ 9.39
8-page offset cover..................... 2,067.00 12.78
K. 8-1/4" x 8-1/4" GRAVURE BODY OPTIONS
------------------------------------
64-page gravure body.................... $ 9,995.00 $ 61.68
80-page gravure body.................... 19,990.00 71.69
96-page gravure body.................... 19,990.00 81.70
100-page gravure body................... 29,985.00 87.65
112-page gravure body................... 19,990.00 96.31
128-page gravure body................... 19,990.00 101.73
144-page gravure body................... 29,985.00 112.35
152-page gravure body................... 29,985.00 119.65
160-page gravure body................... 29,985.00 122.36
168-page gravure body................... 29,985.00 136.75
176-page gravure body................... 29,985.00 139.46
192-page gravure body................... 29,985.00 144.89
Paper Handling (all formats) per cwt.... - -
<PAGE>
J. Crew, Inc. Page 8
Exhibit A - Price Schedule 8/14/97
L. FURNISHED PAPER REQUIREMENTS: 8-1/4" x 8-1/4"
----------------------------------------------
Cover Options Makeready Run Lbs.
------------- Lbs. per 1,000
25 x 38-60# ----------------------
4-page offset cover..................... 1,190 27.42
8-page offset cover..................... 1,190 54.83
Cover Versioning (Based on 4 or 8
page cover)
Black plate change, one side
of web 560
Black plate change, both sides
of web 642
Four-color change, one side
of web 824
Four-color change, both sides
of web 1,190
Cover Options
-------------
25 x 38-70#
4-page offset cover 1,388 31.98
5-page offset cover 1,388 63.96
Cover Versioning (Based on 4 or
8 page cover)
Black plate change, one side
of web 653
Black plate change, both
sides of web 750
Four-color change, one side
of web 961
Four-color change, both sides
of web 1,388
Body Options Makeready Run Lbs.
25 x 38 - 38# Lbs. per 1,000
----------------------
64-page gravure body.................... 5,255 200.82
80-page gravure body.................... 10,510 251.49
96-page gravure body.................... 10,510 301.23
100-page gravure body................... 13,138 314.13
112-page gravure body................... 9,196 351.43
128-page gravure body................... 10,510 401.64
144-page gravure body................... 15,765 452.31
152-page gravure body................... 14,451 476.94
160-page gravure body................... 15,765 502.04
168-page gravure body................... 13,794 527.15
176-page gravure body................... 14,451 552.25
192-page gravure body................... 15,765 602.45
<PAGE>
J. Crew, Inc. Page 9
Exhibit A - Price Schedule 8/14/97
Gravure Body Versions (Per press form):
One-color cylinder change, one side
of web............................ 564
One-color cylinder change,
both sides of web................. 940
Four-color cylinder change,
one side of web................... 1,692
Four-color cylinder change,
both sides of web................. 5,265
PART II - Additionals
---------------------
Presswork Additionals:
Cover Versioning (based on 4-page cover with customer-
supplied paper):
Black plate change, one side
of web............................ $252.00
Black plate change, both sides
of web............................ 370.00
Four-color change, one side
of web............................ 611.00
Four-color change, both sides
of web 1,417.00
Gravure Body Versioning (Per press form
with customer-supplied paper):
Narrow Web
One-color (Black) cylinder change,
one side of web................... 1,374.00
One-color (Black) cylinder change,
both sides of web................. 2,559.00
Four-color cylinder change,
one side of web................... 4,356.00
Four-color cylinder change, both
sides of web...................... 9,995.00
Wide Web
One-color (Black) cylinder change,
one side of web................... 1,897.00
One-color (Black) cylinder change,
both sides of web................. 3,533.00
Four-color cylinder change,
one side of web................... 6,014.00
Four-color cylinder change,
both sides of web................. 13,800.00
Press Stop, each.................. 300.00
Cylinder storage, per cylinder,
first month....................... 56.00
Cylinder storage, per cylinder,
each subsequent month............. 70.00
Pick-up cylinders, makeready press,
per press form.................... 4,512.00
Bindery Additionals:
Bindery Stop...................... 175.00
Bind Makeready
(includes Ink Jet makeready)...... 697.00
<PAGE>
J. Crew, Inc. Page 10
Exhibit A - Price Schedule 8/14/97
Additional for Dot whacking (does not
include cost of the label):
With guarantee of 97%
affixation, per 1,000............. 3.76
100% affixation, per 1,000........ 4.38
Product storage beyond normal
production period, per M
8 pages
First month, per 1,000 8's
stored............................ 0.67
Each additional month,
per 1,000 8's stored.............. 0.16
Short Run Mail: MR per
list under 150,000................ 175.00
Short Run Mail: List less
than 25,000 copies - per M........ 5.64
Short Run Mail: 25,000
to 49,999, per M.................. 3.07
Short Run Mail: 50,000 to
99,999, per M..................... 1.70
Short Run Mail: 100,000 to
149,999, per M.................... 0.95
Drop ship admin, per cwt.......... 0.15
<PAGE>
J. Crew, Inc. Page 11
Exhibit A - Price Schedule 8/14/97
PART II - Additionals (Continued)
---------------------
Bindery Additionals (Continued): -
Additional Ink Jet preparation prices:
Tape Processing, per 1,000............... $0.80
Additional for messages, per 1,000....... 0.56
Zip corrections, each.................... 0.03
Split/rekey, per 1,000................... 0.12
Tape Handling, each...................... 6.62
Bar Codes (Tape Processing),
per 1,000 copies......................... 0.53
Additional to Ink Jet personalized message
on either the cover or the order blank:
Full message of up to 6 lines
of up to 50 characters per line,
per 1,000 copies......................... 0.77
Only a few words or numbers,
per 1,000 copies......................... 0.39
Bar Coding (Ink Jet Operation),
per 1,000 copies......................... 1.58
SELECTRONIC(R) gathering:
Tape Processing
Additional processing
for SELECTRONIC(R) gathering of multi-weight
pieces. Provided the furnished magnetic tape
contains clearly defined codes that can
be used to "trigger" the feeding patter,
machine instructions will be added,
per 1,000...................................... 0.94
Bindery
Basic makeready, each selectronic
run (up to 5 boxes)...................... 678.00
Makeready each additional
selectronically(R) controlled box........ 56.65
Selectronic(R) Running:(charged to
entire run count, not just
Selectronically fired sigs)
Up to 3 boxes, per M.................. 2.25
4 to 6 boxes, per M................... 3.50
7to 10 boxes, per M................... 4.50
Additional for any box with insertion
5% or less, per box per M................ 0.30
Additional for any box with insertion
5% to 10%, per box per M................. 0.20
SELECTRONIC(R) Feeding Cards:
Makeready 246.00
Run, per 1,000 copies 0.17
SELECTRONIC(R) Blow in Cards:
Run, per machine, per 1,000 copies 0.32
<PAGE>
J. Crew, Inc. Page 12
Exhibit A - Price Schedule 8/14/97
SELECTRONIC(R)Dot-Whacking:
Run, per machine, per 1,000 copies 0.28
(Cannot guarantee 100% affixation)
Cartoning, per carton 2.70
Powerpacks, per skid 27.97
<PAGE>
Lancaster Preliminary Center 8/14/97
J. Crew Contract Renewal Pricing Page 1
4/c Document Handling, per page.................... $275.00
Includes QPS check and generation of
related internal proof, replacement of
lo-res image with archived hi-res,
re-sizing and rotating, creation of
composite images, Postscript & RIP,
spreading of knockout type as required,
contract color proofs for page and data
cycles as required. Two color copies
will be pulled of each color proof but only
the final set produced from the press
guidance will be handled as an authorized
proof. Monthly maintenance costs for a
TI telecommunications line are included in
this figure.
New transparency for archive....................... $305.00
Includes the cost of IMAL proofing,
generation of the lo-res, archiving in a
random image database, swatch matching within
the same color family, and fleshtone work.
Cloning, color creation, background work
and other local corrections are additional.
When schedule permits, a second IMAL proofing
cycle will be offered at no additional cost.
4/C Page (inclusive); Maximum charge............... $1,848.00
This price represents a "cap" on the
incremental billing for any page. We will
maintain a spreadsheet that will accumulate
the dollar total for each individual page.
When the normal incremental billing would
otherwise exceed $1848, this price will be
substituted. Color deviations and mechanical
alterations, however, will be charged on the
same basis as for any other page.
Type version page.................................. $76.50
Includes PostScript & RIP, writing a
duplicate 4/c file for NKI transmission or
film output as well as color mechanical
proof - color proof not included
Silhouette mask, per new subject................... $40.50
Shadow, per subject................................ $22.50
Receive and archive image file..................... $14.00
This is to cover the basic handling costs
to accept and maintain an industry standard
hi-res file from an outside source. Any
extraordinary conversion costs will be
charged as additional, as will a silhouette
and/or shadow if the proper accompanying
file or clipping path is not furnished.
<PAGE>
Lancaster Preliminary Center Page 2
J. Crew Contract Renewal Pricing 8/14/97
Mechanical Alterations And Additional Proofs
--------------------------------------------
Rescan transparency for size changes............... $230.00
4/c mechanical change (as marked on
position proof).................................... $67.00
This applies when we are asked to open
the Quark File and make a change to
page mechanics.
Rebuild composite image............................ $41.00
This applies if manual intervention
is required for this function when we
process a document in which images
involving overlapping silhouettes
have shifted.
Color alteration to retrieved image................ $85.00
This charge applies to a color correction
of an archived subject which is then
permanently placed in the archive; the
preceding image is deleted.
Additional color proof............................. $37.80
Late correction premium, per page.................. $117.50
Color Deviations
----------------
Cloning, per item.................................. $97.25
Color creation, per item........................... $139.00
Background work, per background.................... $69.50
System hour rate for specialty work not
included above..................................... $130.00
Ad pages
--------
4/c Base page...................................... $360.00
Includes the basic mechanical construction
of the page but does not include
processing of transparencies, silhouettes
or shadows. Includes a final form color
proof.
New transparency................................... $247.30
Includes the cost of IMAL proofing , image
archiving, swatch matching within the same
color family, and fleshtone work.
Cloning, color creation, background work
and other local corrections are additional.
Pickup image, each................................. $28.91
Additional to resize pickup image.................. $26.28
<PAGE>
Lancaster Preliminary Center Page 3
J. Crew Contract Renewal Pricing 8/14/97
Additional for color alteration to retrieved image. $141.20
Replacement type file.............................. $108.70
Bind-ins
--------
4/c Base page...................................... $360.00
Revise color cycle................................. $190.00
New scan (no archiving) or re-scan for
different GCR level................................ $190.00
4/c mechanical tint page........................... $109.84
Other
-----
Postcard: 4/c Base page............................ $180.44
Billboard file, pick-up or new, one cycle.......... $500.00
Billboard file, pickup or new, each add'l cycle.... $150.00