Initially, Peretti wanted Tiffany to purchase her intellectual property rights, but the two parties were unable to come to an agreement, the spokesman said. One issue Tiffany had under the original contract was that both sides could give just six months notice to withdraw from the partnership — a provision that, considering Peretti’s sizable sales contribution, was concerning.
According to the deal dated Dec. 27, Peretti retains her intellectual property, but Tiffany will pay the designer $47.3 million to ensure that her designs remain at the retailer for 20 years. The payment will be amortized over the duration of the license, amounting to a $2.4 million expense on Tiffany’s income statement over 20 years.
Tiffany will also pay Peretti a basic royalty of $450,000 “per fiscal year during the term,” which would earn Peretti another $9 million, plus a royalty of 5 percent of net sales during the term. There is also a quality control services fee equal to 2 percent of net Peretti sales, for a total of 7 percent of net sales.
Additionally, Tiffany will help grow “Peretti objects,” or home goods and other accessories. The designer requested that Tiffany beef up its inventory of this category, and thus devote a portion of its advertising budget to its promotion. In order to sell more Peretti home wares and accessories, Tiffany will reduce the retail prices of those goods in the U.S. by 20 percent. The spokesman said objects account for a minute percentage of Peretti’s total sales, and it would be negligible to the retailer’s financials.
With the new contract in place, Peretti may not sell, lease or otherwise dispose of her intellectual property unless the buyer expressly agrees with Tiffany to be bound by the provisions of the deal. The agreement also provides that any heir, estate, trustee or permitted successor or assignee of Peretti will be bound by the terms of the Tiffany deal.
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@marianna_hewitt has become one of the most influential content creators in the beauty space, with almost 800,000 Instagram followers and a newly launched skin care line called @SummerFridays. Today, she was awarded Influencer of the Year at the WWD #BeautyIncAwards. (📸: @sophiachabbott )
As shopping behaviors evolve, the retail experience must follow. Head over to retail experts @colliersinternational’s Knowledge Leader series to read more about the shift in our shopping era. #colliersretail #lovecolliers
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@louboutinworld and @disney are making magic once again, creating a set of shoe designs for the release of “Star Wars: The Last Jedi.” Louboutin designed a pair of shoes for each of the film’s four female leads: Rey (@daisyridrey), Vice Admiral Amilyn Holdo (@lauradern), Captain Phasma (Gwendoline Christie) and Rose Tico (@kellymarietran). The shoes will debut on Saturday at the L.A. premiere of the latest episode. #wwdfashion
Today at the #BeautyIncAwards 2017, WWD will be joined by beauty leaders from around the world as we honor this year's most innovative people, products, brands and places. Follow along here and on Twitter for live coverage from the exclusive event. #wwdsummits (📷: @elizaflorendo)
Exclusive: Beauty superinfluencer @marianna_hewitt is launching her first-ever skin care brand with her business partner @laurengores. Their new line Summer Fridays, which will be sold exclusively at summerfridays.com starting in January, is launching with just one product – a hydrating cream Jet Lag Mask. “We wanted to focus on one product that was amazing,” said Hewitt. Read the full interview on WWD.com. Link in bio. #wwdbeauty #wwdnews
Michelin star-rated chef PJ Calapa marks his first solo endeavor with today’s opening of @scampinyc –– the new Southern Italian restaurant located in Manhattans’ Flatiron District. The upscale yet welcoming environment matches the menu, which includes two types of scampi: traditional Italian langoustines in butter and the Americanized version with shrimp over pasta 🍤 - pictured here. #wwdeye (📷: George Chinsee)