EXHIBIT 10.37.2
July 16, 2004
Mr. Colin Dyne
Chief Executive
Officer
Tag-It Pacific,
Inc.
21900 Burbank Blvd, Suite
270
Woodland Hills, CA
91367
Dear Colin:
Tag-It Pacific,
Inc. ("TPI") and Levi Strauss & Co.
("LS&CO.")
are
parties to an Exclusive Stretch Waist Band Component Supply Agreement, as
amended at various times (as
amended, the "AGREEMENT"), under which TPI supplies
to LS&CO. and its manufacturing contractors components and equipment for
the
manufacture of stretch waist bands. Capitalized terms used in this letter
agreement (this "EXTENSION
LETTER") and not
otherwise defined have the meanings
given them in the
Agreement.
TPI and LS&CO.
have agreed to extend and amend the exclusivity
provisions of the Agreement
and to address certain other matters. This Extension
Letter sets out these
agreements.
1.
EXTENSION. As
contemplated by Section 13(b) of the Agreement,
TPI and LS&CO. hereby
agree to extend the exclusivity provisions of Section 7
of
the Agreement through November 1, 2006 with respect to
all Product
Categories
(as such term is amended as
provided herein) other than those Product Categories
described in Section 7(b) of
the Agreement.
2.
NON-US SUPPLY. TPI hereby agrees to supply orders, if any,
for
Products (including
Additional Program
Products) marketed by LS&CO. affiliates
in Europe and Asia.
Notwithstanding
the foregoing, TPI and LS&CO. recognize
that, under the Pro-Fit License, TPI's right to supply Products and
Equipment
for use with respect to
garments sold outside
the United States may be limited,
and TPI's obligations under this Section 2 shall not extend beyond those
obligations that TPI is
permitted to perform under the Pro-Fit License.
3.
ADDITIONAL PROGRAM
PRODUCTS. For purposes of the
Agreement,
through November 1, 2006,
"ADDITIONAL PROGRAM
PRODUCTS" shall include all types
of waistband components purchased by LS&CO., or its
manufacturing
contractors
from TPI on or before the
date hereof and used by LS&CO., or its contractors,
to
manufacture stretch
waistbands using the Pro-Fit Technology for inclusion in
(i)
all LS&CO. products into
which such stretch waistbands have been incorporated on
or before the date hereof
(including,
without limiting the
foregoing,
certain
Dockers(R) brand Original Khaki(TM) in addition to the 81
Waist Band Products,
certain Dockers(R) brand denim, and certain Dockers(R) brand proStyle(TM)
including the "46" Men's
product lines), and (ii) all LS&CO. products or
product
lines with different names for the same pant segments
otherwise described in
clause (i). LS&CO. agrees to continue to purchase (or
cause its contractors to
purchase) Products
(including
Additional Program
Products, as defined
in this
Amendment) from TPI through
November 1, 2006, it being understood that LS&CO. is
not making any guarantee of
Product volume
purchases. LS&CO.
also
anticipates
that TPI and
<PAGE>
LS&CO. will discuss, and that TPI will bring forward
for LS&CO.'s
evaluation,
other potential applications of the Pro Fit Technology licensed by TPI for
Dockers(r) product
