<\/p>\n 1985 [***]
\n 1986 and 1987 [***]
\n 1988 [***]
\n 1989 and thereafter [***]
\n<\/c><\/s><\/caption>\n<\/table>\n
4.4 The Chaps Royalty shall be equal to [***] percent [***] of
\nLicensee’s Net Sales of Chaps Royalty Products for calendar year 1985 and to
\n[***] percent [***] of Licensee’s Net Sales of Chaps Royalty Products for
\ncalendar year 1986 and each year thereafter.<\/p>\n
4.5 The Regular Royalty, the Cosmetics Royalty and the Chaps
\nRoyalty shall be paid as follows: With respect to each Semi-Annual Accounting
\nPeriod, the entire Regular Royalty, Cosmetics Royalty and Chaps Royalty for such
\nSemi-Annual Accounting Period shall be paid on or before the last day of the
\nmonth next following the end of such Semi-Annual Accounting Period.<\/p>\n
4.6 The following terms, as used in this Agreement, shall have
\nthe meanings hereinafter set forth:<\/p>\n
(a) The term “Semi-Annual Accounting Period” as used
\n herein shall mean each 6-month period ending June 30 and December 31 of
\n each year during the term of this Agreement, except that the first
\n Semi-Annual Accounting Period hereunder shall be the period from the date
\n hereof through June 30, 1985.<\/p>\n
16
\n 13<\/p>\n
(b) The term “Net Sales” as used herein shall have the
\n gross sales made by or through Licensee and its Affiliates to retailers or
\n to ultimate consumers (as in the case of accommodation sales to their
\n respective employees and to others) of Full-Priced Royalty Products,
\n excluding amounts received for shipping charges and sales, excise or other
\n taxes which are collected by them, and less all allowances, discounts,
\n returns and bad debts. The term “bad debts” as used in this subparagraph
\n shall mean accounts receivable of Licensee and its Affiliates arising from
\n the aforesaid sales of Full-Priced Royalty Products which have not been
\n paid within 120 days after the due date; provided, however, that if any
\n bad debt is subsequently collected, then, and in such event, the amount
\n thereafter collected on account of such bad debt shall, upon collection,
\n be included in Licensee’s Net Sales for the period collected. Sales of
\n Licensed Products between Licensee and its Affiliates (or persons, firms,
\n corporations or businesses with rights to use the Names on Licensed
\n Products outside the Territory), or between said Affiliates, shall not be
\n included in the calculation of the Company’s Net Sales, provided such
\n sales are made solely for the purpose of further re-sale.
\n (c) The term, “Full-Priced Royalty Products” as used
\n herein shall mean all Royalty Products except (i) display materials,
\n samples and dummies and (ii) Promotion Products.<\/p>\n
(d) The term “Promotion Products” shall mean Royalty
\n Products which are sold to retailers (x) at a price yielding less than the<\/p>\n
17
\n 14<\/p>\n
mark-up or profit margin generally realized by the Licensee or its
\n Affiliates upon the sale by them to retailers of Royalty Products (y) to
\n enable such retailers to re-sell such products to ultimate consumers in
\n conjunction with the sale by such retailers to ultimate consumers of other
\n Royalty Products (which are not Promotion Products), and (z) for the
\n purpose of promoting the sale of such other Royalty Products; provided,
\n however, that, notwithstanding the foregoing, if the Cost of Goods (as
\n hereinafter defined) to Licensee or its Affiliates (as the case may be) of
\n a Royalty Product is not greater than [***] percent [***] of the price at
\n which such product is sold by them to retailers, then, and in such event,
\n such Royalty Product shall not be deemed a Promotion Product. The Cost of
\n Goods of a Royalty Product shall include and consist of (i) the variable
\n costs of materials (including packaging, components, chemicals) and all
\n other manufacturing costs directly traceable to the production of units of
\n the Royalty Product, (ii) all direct labor costs, and (iii) an appropriate
\n allocation of all fixed costs consisting of all manufacturing costs and
\n overhead not traceable to specific units of production (such as rent,
\n heat, plant manager, etc.), all in conformity with normal industry
\n practice. Licensee shall sell or give away products which are not Royalty
\n Products in conjunction with Royalty Products only with Licensor’s prior
\n approval (or with Lauren’s approval given pursuant to paragraphs 2(h) and
\n 4(f) of the Design Agreement), to be exercised in Licensor’s sole
\n discretion. Sales of such products shall nevertheless be subject to
\n royalty payments pursuant to this<\/p>\n
18
\n 15<\/p>\n
paragraph 4 unless otherwise agreed by Licensor and Licensee or unless
\n such products are purchased from licensees of PFI and Lauren or their
\n Affiliates in transactions from which PFI and Lauren or their Affiliates
\n will derive their full royalty and compensation (as the case may be) fees
\n or unless the Cost of Goods of such products to Licensee or its Affiliates
\n (as the case may be) is greater than [***] percent [***] of the price at
\n which such products are sold by them to retailers. Upon Licensor’s
\n request, Licensor and Licensee shall review periodically Licensee’s
\n promotional practices hereunder, and should said review reveal that
\n Licensee is deriving excess profits or sales of said non-Royalty
\n Products, Licensor and Licensee shall negotiate in good faith an
\n appropriate royalty to be paid in connection with said sales.<\/p>\n
5. Records and Reports.<\/p>\n
5.1 With each payment of a Royalty made pursuant to article 4
\nhereof, Licensee shall furnish to Licensor a statement (the “Royalty Statement”)
\nwhich shall show for the relevant period, separately with respect to each range
\nof Royalty Products and each kind of Promotion Product, the aggregate amount of
\nLicensee’s gross sales and Licensee’s Net Sales of the same and the aggregate
\namount of Licensee’s returns of and allowances for such product. Each Royalty
\nStatement shall contain a separate certificate by an officer of Licensee to the
\neffect that Promotion Products referred to therein as sold by Licensee comprised
\n“Promotion Products” as defined in this Agreement. Licensor shall have a period
\nof one (1) year after receipt of each Royalty Statement to object thereto by
\ndelivering to Licensee a<\/p>\n
19
\n 16<\/p>\n
written statement (“Notice of Disagreement”) setting forth in detail the item or
\nitems objected to and the Licensor’s reasons therefor, except that Licensor
\nshall have a period of two (2) years after receipt of a Royalty Statement to
\nassert a claim (by a Notice of Disagreement) that Promotion Products referred to
\nin the Royalty Statement were in fact Full Priced Royalty Products. If Licensor
\ndoes not timely object to items set forth in a Royalty Statement by delivering a
\nNotice of Disagreement within the time allowed, such items contained in the
\nRoyalty Statement as to which timely objection was not made shall be deemed to
\nbe conclusive and binding upon Licensor and Licensee.<\/p>\n
In addition to the above information, each Royalty Statement shall
\nset forth (i) with respect to each account receivable of the Licensee
\nconstituting a bad debt (as hereinabove defined) the following information: the
\nname and address of the account receivable debtor, the amount of the account
\nreceivable of such debtor constituting a bad debt and the date of the invoice or
\nbill which remains unpaid in whole or in part (thereby creating the bad debt)
\nand (ii) with respect to each bad debt from a prior accounting period which was
\ncollected during the accounting period covered by a Royalty Statement, the
\nfollowing information: the name and address of the account receivable debtor,
\nthe amount of the bad debt from a prior accounting period which was collected
\nduring the accounting period covered by the Royalty Statement and the date of
\nthe earlier Royalty Statement on which the bad debt had been charged against
\nLicensee’s Net Sales.<\/p>\n
20
\n 17<\/p>\n
5.2 During the term of this Agreement, Licensee shall keep at
\nits office complete and accurate books and records pertaining to Licensee’s
\nobligations hereunder. Such books and records shall show, by kind, quantity and
\nname of customer, (i) the dollar volume of all sales of Royalty Products and
\nPromotion Products made by Licensee and its Affiliates within the Territory,
\n(ii) the Cost of Goods of Promotion Products and (iii) the accounts receivable
\nand bad debts of Licensee.<\/p>\n
Licensor shall have and is hereby granted the right, to be exercised
\nno more frequently than once in any Semi-Annual Accounting Period, to have
\nLicensee’s said books and records examined by a certified public accountant or
\nother representative selected by Licensor for the purpose of verifying the
\nRoyalty Statements. Licensee shall permit access to its books and records for
\nthe purpose of such examination during the normal hours of business upon receipt
\nof notice from Licensor not less than five (5) business days in advance of the
\nrequested date of examination. Such examination requested by Licensor shall be
\nmade at Licensor’s sole cost and expense, except that if upon any such
\nexamination Licensor shall determine and demonstrate that the amount of
\nLicensee’s Net Sales as set forth in a Royalty Statement has been understated by
\nno more than three percent (3%) then, and in such event, Licensee shall
\nreimburse Licensor for the fair and reasonable cost of Licensor of its
\nexamination of Licensee’s books and records for the period covered by such
\nunderstated Royalty Statement.<\/p>\n
21
\n 18<\/p>\n
6. Representations and Warranties.<\/p>\n
6.1 Licensor hereby makes the following representations and
\nwarranties to Licensee:<\/p>\n
(a) As of November 22, 1976 Licensor was the sole owner
\n of the trademark “Polo by Ralph Lauren,” United States Patent Office
\n Registration No. 1,021,368 covering certain products in U.S. Class 51 (as
\n more fully set forth on Schedule A-1 hereto).<\/p>\n
As of November 22, 1976, PFI was the registered owner of, and
\nLauren had consented to the use of his name in connection with the registration
\nof, the trademarks (i) “Polo (with design) by Ralph Lauren,” United States
\nPatent Office Registration No. 978,166 covering certain products in U.S. Class
\n39, (ii) “Ralph Lauren” (and Polo Player Design), United States Patent Office
\nRegistration No. 984,005 covering certain products in U.S. Class 39, (iii)
\n“Chaps by Ralph Lauren,” United States Patent Office Registration No. 1,016,955
\ncovering certain products in U.S. Class 39, and (iv) “Polo by Ralph Lauren”
\ncovering certain products in Class 26. PFI and Lauren, by written instrument
\nduly and fully executed by them, have consented to, and have agreed to interpose
\nno objection to, the registration, use and licensing of the foregoing
\ntrademarks, the Names and all other names and marks which either or both (or any
\nbusiness entity which is now or hereafter owned or controlled, directly or
\nindirectly, by either or both of them), may hereafter develop or own (except
\nsuch other names and marks as are not used in connection with any fashion
\nrelated product) in connection with the manufacture<\/p>\n
22
\n 19<\/p>\n
and\/or distribution and sale of Licensed Products by Licensee and its
\nAffiliates, as contemplated by this Agreement;<\/p>\n
(b) Licensor has the full right, power and authority to
\n execute and deliver, and perform the terms of, this Agreement and the
\n consummation of the transactions contemplated by this Agreement will not
\n violate any agreement to which Licensor is a party or by which it may be
\n bound;<\/p>\n
(c) Without limiting the generality of the last
\n preceding subparagraph, Licensor has the full right to grant the License.
\n Licensor is not a party to or bound by any agreement in conflict herewith
\n or with any provision hereof. Licensor has not granted to any other
\n person, firm, corporation or business any right, license or privilege to
\n use in the Territory the Names or associated crests, symbols, logos or
\n identifying marks or any name, crest, symbol, logo or identifying mark
\n which would be confusingly similar thereto in connection with any Licensed
\n Product, or which would have the effect of infringing upon the exclusivity
\n of the License granted to Licensee hereunder;<\/p>\n
(d) Schedules A-1 and A-2 annexed hereto contain a full
\n and complete list of all registrations existing as of November 22, 1976
\n covering the Current Names and associated crests, symbols, logos and
\n identifying marks in the class of use owned by or registered in the name
\n of Licensor, Lauren and\/or PFI in any part of the world; and<\/p>\n
23
\n 20<\/p>\n
(e) To the best of Licensor’s knowledge as of November
\n 22, 1976 (without any representation of an investigation having been made
\n as of such date) no persons other than Licensor, Lauren or PFI had as of
\n November 22, 1976 any trade name, trademark or similar right or interest
\n in or to the “Ralph Lauren,” “Polo” and “Chaps” Names as applied to
\n Licensed Products in the Territory.<\/p>\n
6.2 Licensee hereby makes the following representations and
\nwarranties to Licensor:<\/p>\n
(a) Licensee has the full power and authority to enter
\n into this Agreement and to perform its obligations hereunder and the
\n consummation of the transactions contemplated hereunder will not violate
\n any agreement to which Licensee is a party or by which it may be bound;
\n and<\/p>\n
(b) This Agreement constitutes a valid and binding
\n obligation of Licensee, enforceable in accordance with its terms.<\/p>\n
7. Additional Covenants.<\/p>\n
7.1 Licensor covenants and agrees as follows:<\/p>\n
(a) Except as expressly provided in paragraph 2.5 of
\n this Agreement and only on the terms and conditions set forth therein,
\n Licensor will not, and will not permit any business entity owned or
\n controlled by it to, grant any persons, firm, corporation or business
\n (other than Licensee) any right, license or privilege to use in the
\n Territory the Names or associated crests, symbols, logos or identifying
\n marks or any name, crest, symbol, logo<\/p>\n
24
\n 21<\/p>\n
or identifying mark which would be confusingly similar thereto in
\n connection with any Licensed Product, or which would have the effect of
\n infringing upon the exclusivity of the License granted to Licensee
\n hereunder;<\/p>\n
(b) (i) For the purpose of this paragraph, the term
\n “First Trademarks” shall mean and refer to, collectively, the
\n trademarks “POLO,” “RALPH LAUREN” and the representation of a polo
\n player on a horse as exemplified by the showing in Registration Nos.
\n 1,050,722 and 1,053,873. Licensor shall have the right, to be
\n exercised in its sole discretion, to control the prosecution of each
\n application to register the First Trademarks in the United States
\n Patent and Trademark Office, including the right to seek either
\n appellate or de novo review of any final administrative
\n determination by the United States Patent and Trademark Office.<\/p>\n
(ii) If Licensee suffers or incurs any losses, damages,
\n liabilities or expenses which would not have been suffered or
\n incurred if PFI (rather than Licensor) had owned the Names and had
\n applied for registration of the First Trademarks, Licensor hereby
\n indemnifies and holds Licensee harmless from any and all such
\n losses, damages, liabilities and expenses (including, without
\n limitation, reasonable attorneys’ fees and disbursements) paid or
\n incurred, provided, however, that any such loss, damage, liability
\n or expense is paid or incurred by Licensee before PFI has filed
\n applications in its<\/p>\n
25
\n 22<\/p>\n
own name for registration of the First Trademarks. In the event any
\n claim is made or accrued (to Licensee’s knowledge) against Licensee
\n which comes within the indemnity set forth in this subparagraph,
\n Licensee will promptly notify Licensor of such claim. Thereafter,
\n Licensor shall have the right, at its own expense and with counsel
\n of its own choice, subject to the approval of Licensee, which
\n approval will not be unreasonably withheld, to assume the defense of
\n any such claim. Licensee agrees to cooperate fully in the defense of
\n any such claim and may, at its own expense and with counsel of its
\n own choice, participate in the defense of any such claim.<\/p>\n
(c) During the term of this Agreement, Licensee shall
\n have and is hereby granted the right, without cost or expense to Licensor,
\n to file for registration of the Names as applied to the Licensed Products
\n in the Territory (it being understood that such registrations shall be
\n obtained in the names of Licensor or PFI or Lauren, if appropriate
\n pursuant to the provisions of paragraph 7.1(b) hereof) and, accordingly,
\n Licensor (or PFI or Lauren, as the case may be) shall have the right,
\n title and interest in any trade names or trademarks so registered subject
\n to the exclusive License of Licensee granted hereby). Licensee shall have
\n the right, to the extent permitted by law, to make application to register
\n Licensee as a permitted user or registered user of such trade names or
\n trademarks in the Territory and Licensor shall appoint Licensee as its
\n attorney-in-fact to apply for and register, in the name of<\/p>\n
26
\n 23<\/p>\n
Licensor (or PFI or Lauren, if appropriate pursuant to the provisions of
\n paragraph 7.1(b) hereof), in the Territory all trade names and trademarks
\n which make use of the Names or are associated therewith as applied to
\n Licensed Products. Licensee shall provide Licensor with copies of all
\n applications filed and registrations obtained and shall include Licensor
\n on its or its trademark counsel’s trademark watch and distribution list so
\n as to keep Licensor apprised of any applications, registrations,
\n oppositions and proceedings relating to the trade names and trademarks
\n which make use of the Names or are associated therewith. Licensor will
\n cooperate with Licensee in all manners and respects, but at Licensee’s
\n expense, to enable Licensee to obtain the aforesaid registrations, and
\n Licensor will execute any further agreements, documents and instruments as
\n may be necessary to effect the same. Nothing herein shall (x) subject only
\n to the provisions of paragraph 2.5 of this Agreement, preclude Licensee
\n from using a Name for a Licensed Product in the Territory for the purposes
\n set forth in this Agreement without registration of the same [provided,
\n however, that Licensee will not use a name in the Territory without
\n registration of the same (except as may be necessary to establish use in
\n interstate commerce) if there is substantial risk, in Licensee’s sole
\n judgment, that the use of such name by Licensee will infringe on the
\n rights of third persons who are unaffiliated with Licensor, Lauren or PFI
\n and whose rights or claimed rights to such name do not arise after the
\n date of this Agreement or by reason of a grant or claimed grant from
\n Licensor,<\/p>\n
27
\n 24<\/p>\n
Lauren, PFI or an entity owned or controlled by any of them], or (y)
\n preclude Licensor from filing, at Licensor’s own cost and expense, for
\n registration of any of the Names in the Territory. Nothing contained in
\n this subparagraph 7.1(c) shall be construed to limit the obligations of
\n Licensor under subparagraph 7.1(b) of this Agreement; if any Name is
\n registered in the Territory, at Licensee’s request Licensor will promptly
\n execute and return to Licensee a letter confirming that such trade name or
\n trademark is covered by this Agreement.<\/p>\n
(d) Licensor will not, during the term of this Agreement
\n or at any time thereafter, disclose to any person, firm, corporation or
\n business (other than a person, firm, corporation or business with rights
\n to use the Names on Licensed Products outside the Territory, if required
\n in connection with a program for Licensed Products outside the Territory)
\n any confidential information (including, without limitation, customer
\n lists) concerning the conduct of the business and affairs of Licensee or
\n of any Affiliate of Licensee which Licensor may have acquired during the
\n course of this Agreement except as may be required pursuant to law and
\n then only upon advance notice to Licensee;<\/p>\n
(e) Licensor shall protect, indemnify and save harmless
\n Licensee and each of Licensee’s officers, directors, employees and agents
\n against any and all liabilities, claims, damages, penalties, causes of
\n action, costs and expense, including reasonable attorneys’ fees, arising
\n out of<\/p>\n
28
\n 25<\/p>\n
the breach or material inaccuracy of any of the representations,
\n warranties, covenants and agreements of Licensor contained in this
\n Agreement. Licensee shall have the right in its discretion, and with
\n counsel of its own choosing, to take any action, legal or otherwise, in
\n its own name and\/or in the name of Licensor, at Licensee’s discretion, to
\n protect any trade name or trademark covered by the License from
\n infringement, counterfeiting or passing off. Prior to taking any such
\n action, Licensee shall advise Licensor of its intention to commence the
\n proposed action and thereafter at Licensor’s request, shall promptly
\n furnish Licensor with copies of relevant documents and keep Licensor
\n advised of developments relating to the action. Licensor shall cooperate
\n with Licensee and, if requested, shall join as a plaintiff in any such
\n action with counsel designated by Licensee. Any legal expenses incurred in
\n the prosecution of such action shall be borne by, and any money recoveries
\n received as a result of such action shall belong to, Licensee; provided,
\n however, that the net amount of any such recovery upon a final,
\n non-appealable judgment, after deducting the aggregate amount of all and
\n every cost and expense of such an action (including attorney’s fees, court
\n costs, printing fees, witness fees, etc.), shall be included in Licensee’s
\n Net Sales for the purpose of calculating the Royalty;<\/p>\n
(f) Licensor acknowledges that the Current Names have
\n established prestige and good will in the field of fashion apparel and
\n that it is of major importance to Licensee that the high standards and
\n reputation of<\/p>\n
29
\n 26<\/p>\n
the Current Names be maintained. Licensor will not take any action which
\n would be likely to injure or damage the reputation for high quality which
\n has come to be associated with the Current Names. Licensee shall not be
\n entitled to damages by reason of Licensor’s breach or default of its
\n obligations under this paragraph 7.1(f) and Licensee’s sole remedy shall
\n be to terminate this Agreement pursuant to paragraph 9.1(b) hereof;<\/p>\n
(g) If Licensor hereafter registers any new Name in any
\n part of the world, Licensor will promptly thereafter advise Licensee; and<\/p>\n
(h) At the request of Licensee, Licensor will from time
\n to time, at no cost or expense to Licensee, deliver promptly to Licensee
\n (i) instruments executed by Licensor granting to Licensee the exclusive
\n license in and to each trade name or trademark (for the classes of use
\n contemplated by this Agreement) used by Licensee hereunder for a Royalty
\n Product and\/or instruments evidencing such grant, which instruments shall
\n be in form and substance, satisfactory to Licensee’s trademark counsel in
\n such counsel’s reasonable judgment, (ii) short form agreements of this
\n Agreement (for records and other reasonable purposes), provided that the
\n same shall be in all respects consistent with the rights and obligations
\n hereunder, of, respectively, Licensor and Licensee, and (iii) such other
\n and additional documents and instruments as may reasonably be requested by
\n Licensee in furtherance of and to implement the purposes and provisions of
\n this Agreement and the transactions provided for herein.<\/p>\n
30
\n 27<\/p>\n
7.2 Licensee covenants and agrees as follows:<\/p>\n
(a) Licensee will diligently promote the sale of the
\n Royalty Products and will use its best efforts in this regard;<\/p>\n
(b) It is understood that Licensor assumes no liability
\n to Licensee or third parties with respect to the performance
\n characteristics of the Royalty Products, and Licensee will protect,
\n defend, indemnify and save harmless Licensor, its employees and agents,
\n against any and all liabilities, claims, damages, penalties, cause of
\n action, costs and expenses, including reasonable attorneys’ fees, for
\n product liability claims of third persons arising out of the use of such
\n products by such third persons. Licensee will carry product liability
\n insurance policies in such amount as Licensee, in its sole judgment and
\n discretion deem adequate and will cause Licensor and Lauren to be included
\n as additional named insureds under such policies and will provide Licensor
\n with copies of insurance certificates evidencing same;<\/p>\n
(c) Licensee will not, during the term of this Agreement
\n or at any time thereafter, disclose to any person, firm, corporation, or
\n business (other than a person, firm, corporation or business with rights
\n to use the Names on Licensed Products outside the Territory) any
\n confidential information concerning the conduct of the business and
\n affairs of Licensor which Licensee may have acquired during the course of
\n this Agreement except as may be required pursuant to law and then only
\n upon advance notice to Licensor;<\/p>\n
31
\n 28<\/p>\n
(d) The Royalty Products shall be of high quality and
\n workmanship. For the purposes of ascertaining Licensee’s compliance with
\n the last preceding sentence, Licensee will permit duly authorized
\n representatives of Licensor to inspect the Royalty Products and Licensee
\n shall upon request of Licensor submit to Licensor samples of all such
\n products;<\/p>\n
(e) Licensee acknowledges that the Current Names have
\n established prestige and good will in the field of fashion apparel and
\n that it is of major importance to Licensor that in the manufacture,
\n advertising, distribution, promotion and sale of Royalty Products, the
\n high standards and reputation of the Current Names be maintained. Licensee
\n will not take any action which would be likely to injure or damage the
\n reputation for high quality which has come to be associated with the
\n Current Names. Without limiting the generality of the foregoing, Licensee
\n shall maintain the high prestige and good will of the Current Names in all
\n manufacturing, advertising, distribution, promotion and sale of the
\n Royalty Products. Licensor’s remedies for breach or default by Licensee
\n under this paragraph 7.2(e) shall be limited to termination of this
\n Agreement pursuant to paragraph 9.1(a) hereof and\/or injunctive relief;<\/p>\n
(f) Licensee acknowledges that, except as set forth in
\n paragraph 6.1 hereof, Licensor has not represented to Licensee that
\n Licensor, Lauren or PFI have any trademarks, trade names or other rights
\n or interests in or to the Names or that persons other than Licensor,
\n Lauren or PFI have no<\/p>\n
32
\n 29<\/p>\n
such trademarks, trade names or other rights or interests. If Licensee
\n uses any Name as a trademark, trade name or product name for a Royalty
\n Product without registration of the same (except as may be necessary to
\n establish its use in commerce) Licensee will protect, defend, and save
\n harmless Licensor, PFI and Lauren from and against any claims of third
\n persons for infringement, counterfeiting or passing off against them
\n arising out of the use of such unregistered Name provided that (x) in
\n connection therewith neither Licensor, Lauren nor PFI shall have
\n misrepresented to Licensee their rights or interests in or to such Name
\n whether in this Agreement or in any other instrument, and (y) such claim
\n shall not arise by reason of any action taken or not taken (as
\n contemplated by paragraph 7.1(b) of this Agreement) by Licensor, Lauren or
\n PFI in breach of any obligation they may have to Licensee whether arising
\n under this Agreement or under any other instrument; and<\/p>\n
(g) Licensee shall protect, indemnify and save harmless
\n Licensor, Lauren and PFI and each of their employees and agents against
\n any and all liabilities, claims, damages, penalties, causes of action,
\n costs and expenses, including reasonable attorneys’ fees and
\n disbursements, arising out of the breach or material inaccuracy of any of
\n the representations, warranties, covenants and agreements of Licensee
\n contained in this Agreement.<\/p>\n
33
\n 30<\/p>\n
8. Relationship of Parties.<\/p>\n
This Agreement shall not create nor be considered to create the
\nrelationship of master and servant, principal and agent, partnership or joint
\nventure between the parties hereto, and neither party shall be liable for any
\nobligation, liability, representation, negligent act or omission to act an the
\npart of the other except as expressly set forth herein.<\/p>\n
9. Termination.<\/p>\n
9.1 This Agreement and License shall continue in full force
\nand effect until terminated in one of the following ways, but in any event shall
\nterminate upon termination of the Design Agreement being executed simultaneously
\nherewith:
\n (a) By Licensor, in the event that (i) any royalty is
\n not paid by Licensee when due and such failure to pay is not cured within
\n ten (10) days following notice to the Licensee of such failure (unless
\n such payment is disputed by Licensee in good faith, in which event the
\n time to cure a failure to make payment shall begin after the rendition of
\n an unappealable final judgment by an arbitration panel or court of
\n competent jurisdiction), (ii) the Design Agreement being executed
\n simultaneously herewith is terminated pursuant to the provisions of
\n paragraph 8(a) thereof, (iii) in each of any two (2) consecutive fiscal
\n years of the Licensee commencing after December 31, 1986, the aggregate
\n sum of Licensee’s Net Sales under this Agreement shall average less than
\n [***] dollars per year, (iv) Licensee fails<\/p>\n
34
\n 31<\/p>\n
or refuses to maintain high standards of quality for Royalty Products as
\n provided by subparagraph 7.2(d) hereof, unless such failure or refusal is
\n cured within one hundred and twenty (120) days after notice of the same
\n has been given by Licensor (with respect to Products sold after the end of
\n such period), (v) Licensee makes an assignment for the benefit of
\n creditors or is adjudged in any legal proceeding to be a voluntary or
\n involuntary bankrupt, (vi) the representations of Licensee herein are not
\n true and correct in any material respect, or (vii) there shall be a
\n substantial breach by Licensee of any other material provision of this
\n Agreement which breach shall not have been cured within ninety (90) days
\n after Licensor shall have given Licensee notice of the same;<\/p>\n
(b) By Licensee, in the event that (i) Licensee is
\n temporarily or permanently enjoined or restrained with respect to a
\n Royalty Product from using in any part of the United States any Current
\n Name or associated crest, symbol, logo or identifying mark as contemplated
\n by this Agreement and such injunction or restraint remains in effect for a
\n period of not less than thirty (30) days, (ii) the Design Agreement being
\n executed simultaneously herewith is terminated pursuant to the provisions
\n of paragraph 8(b) thereof, (iii) Licensor, Lauren or PFI makes an
\n assignment for the benefit of creditors or is adjudged in any legal
\n proceeding to be voluntarily or involuntarily bankrupt, (iv) the
\n representations of Licensor herein are not true and correct in any
\n material respect, or (v) there shall be a substantial<\/p>\n
35
\n 32<\/p>\n
breach by Licensor of any other material provision of this Agreement,
\n which breach shall not have been cured within ninety (90) days after
\n Licensee shall have given Licensor notice of the same; and<\/p>\n
(c) For the purposes of subparagraphs (a) and (b) of
\n this paragraph 9.1, a breach of this Agreement shall be deemed to be cured
\n if the course of conduct or omission comprising or causing such breach is
\n timely brought to an end whether or not the effects of such prior conduct
\n or omission continue thereafter.<\/p>\n
9.2 The exercise by either party hereto of any of the
\nforegoing rights of termination shall not constitute a waiver of other rights
\nand remedies available to such terminating party, including, unless otherwise
\nspecifically provided herein, any right to damages. The failure by either party
\nto insist upon the strict performance of any provision hereof shall not
\nconstitute a waiver by such party of its right to strict performance of such
\nprovision in the future nor shall a waiver of any right hereunder on any
\noccasion constitute a waiver of such right on any other occasion.<\/p>\n
9.3 During the “Post Termination Period” referred to in
\nparagraph 9.4 hereof, Licensee may continue to sell Royalty Products which were
\nin inventory, in process, or for which written orders had been received from
\ncustomers, as of the date of termination of this Agreement. Upon the conclusion
\nof the Post-Termination Period (i) the License shall terminate and Licensee
\nshall be prohibited from making any further use of the Names or associated
\ncrests, symbols, logos and<\/p>\n
36
\n 33<\/p>\n
identifying marks, and (ii) all rights and interests in and to the Names shall
\nbelong to and be the property of Licensor, and Licensee shall have no further or
\ncontinuing right or interest therein (subject only to the rights of Licensee
\nunder paragraph 9.4 hereof).<\/p>\n
9.4 Notwithstanding anything to the contrary elsewhere herein
\ncontained, Licensor will not authorize or license anyone else to, and will not
\npermit any business entity owned or controlled by it to, (i) use any “Restricted
\nName” (as hereinafter defined) for or in connection with a Licensed Product
\nmarketed during the “Post-Termination Period” (as hereinafter defined), (ii)
\ngrant any person, firm, corporation or business any right, license or privilege
\nto use during the Post-Termination Period any Restricted Name for or in
\nconnection with a Licensed Product, (iii) use any “Restricted Package Design”
\n(as hereinafter defined) for a Licensed Product marketed during the
\nPost-Termination Period, or (iv) grant any person, firm, corporation or business
\nany right, license or privilege to use any Restricted Name for or in connection
\nwith a Licensed Product unless such person, firm, corporation or business
\nagrees, for the benefit of Licensee, that it will not use a Restricted Package
\nDesign during the Post-Termination Period. For the purposes of this paragraph
\n9.4, the term (x) “Restricted Name” shall mean each and any Name and associated
\ncrest, symbol, logo or identifying mark used by Licensee as a trade name,
\ntrademark or product name for or in connection with a Royalty Product prior to
\nthe termination of this Agreement, (y) “Post Termination Period” shall mean the
\nperiod of one hundred and eighty (180) days after the date of termination of
\nthis<\/p>\n
37
\n 34<\/p>\n
Agreement if this Agreement is terminated by Licensor under the provisions of
\nsubparagraph 9.1(a) hereof or the period of three hundred sixty-five (365) days
\nafter the date of termination of this Agreement if this Agreement is terminated
\nby Licensee under the provisions of subparagraph 9.1(b) hereof, and (z)
\n“Restricted Package Design” shall mean the design of any cap, bottle and\/or
\ncarton used by Licensee for any Royalty Product prior to the termination of this
\nAgreement and any design for a cap, bottle and\/or carton which would be
\nconfusingly similar thereto. For the purposes of this paragraph 9.4 a product
\nshall be deemed to be marketed as of and on the date when a shipment is first
\nmade to a retailer or other wholesale customer.<\/p>\n
9.5 Within thirty (30) days following the date of termination
\nof this Agreement if this Agreement is terminated by Licensor under the
\nprovisions of subparagraph 9.1(a) hereof and within one hundred eighty (180)
\ndays after the date of termination of this Agreement if this Agreement is
\nterminated by Licensee under the provisions of subparagraph 9.1(b) hereof,
\nLicensee shall furnish to Licensor a certificate of Licensee listing its
\ninventories (and those of its Affiliates) of Royalty Products (which defined
\nterm for purposes of this paragraph shall include all packaging which is used in
\nthe manufacture and marketing of Royalty Products) on hand or in process
\nwherever situated. Licensor or Licensor’s designee shall have the option (but
\nnot the obligation) to purchase from Licensee and its Affiliates all of their
\n(and that of its Affiliates) then existing inventory of Royalty Products upon
\nthe following terms and conditions:<\/p>\n
38
\n 35<\/p>\n
(i) Licensor shall notify Licensee of its or its designee’s
\n intention to exercise the foregoing option within 30 days of delivery of
\n the certificate referred to above.<\/p>\n
(ii) The price for Royalty Products manufactured by Licensee
\n or its Affiliates on hand or in process shall be the Cost of Goods (as
\n defined in paragraph 4.6(d)) for each such Royalty Product. The price for
\n all other Royalty Products which are not manufactured by Licensee or its
\n Affiliates shall be the landed costs therefor. Landed costs for the
\n purposes hereof means the F.O.B. price of the Royalty Products together
\n with customs, duties, and brokerage, freight and insurance.<\/p>\n
(iii) Within fifteen (15) days of receipt of the notice
\n referred to in clause (i) above, Licensee shall deliver or cause to be
\n delivered the Royalty Products purchased at a place to be signed by
\n Licensor. Payment of the purchase price for the Royalty Products so
\n purchased by Licensor or its designee shall be payable upon delivery
\n thereof, provided that Licensor shall be entitled to deduct from such
\n purchase price any amounts owed to it by Licensee. Notwithstanding
\n anything else to the contrary elsewhere herein contained, once Licensee
\n shall have received the notice referred to in clause (i) above, the
\n provisions contained in paragraph 9.4 hereof and in the first sentence of
\n paragraph 9.3 hereof shall no longer be applicable.<\/p>\n
39
\n 36<\/p>\n
10. Assignment.<\/p>\n
10.1 Licensor may assign its rights to royalties under this
\nAgreement, but such assignment shall not have the effect of releasing or
\ndischarging Licensor from its obligations hereunder unless Licensee shall
\nexpressly so agree in writing.<\/p>\n
10.2 Licensee may assign its rights and obligations under this
\nAgreement only (i) to a transferee of substantially all of its business or
\nassets and upon the express assumption of all of Licensee’s obligations
\nhereunder by such transferee or to a successor to Licensee’s business by way of
\nmerger, consolidation or other business combination or (ii) to an Affiliate, in
\nwhich case Licensee shall remain liable hereunder.<\/p>\n
11. Arbitration, Equitable Remedies and Damages.<\/p>\n
11.1 Any controversy, claim or dispute arising out of or
\nrelating to this Agreement or breach thereof, except with respect to an
\napplication pursuant to paragraph 11.2 hereof, shall be settled by binding
\narbitration in accordance with the rules of the International Chamber of
\nCommerce, by three arbitrators selected in accordance with such rules, and
\njudgment upon any award so rendered may be entered in any court having
\njurisdiction thereof. The arbitration shall be held in New York, New York.
\nNotice of arbitration shall be sufficient if made or given in accordance with
\nthe provisions of article 14 hereof.<\/p>\n
11.2 In the event of a breach or threatened breach of this
\nAgreement, any party hereto shall have the right, without the necessity of
\nproving any<\/p>\n
40
\n 37<\/p>\n
actual damages, to obtain mandatory or permanent injunctive or mandatory relief
\nin a court of competent jurisdiction, it being the intention of the parties that
\nthis Agreement be specifically enforced to the maximum extent permitted by law.<\/p>\n
11.3 If the representations of Licensor contained herein are
\nnot true and correct in any material respect or if there shall be a substantial
\nbreach by Licensor of any covenant contained herein, which breach shall not have
\nbeen cured within ninety (90) days after Licensee shall have given Licensor
\nnotice of the same then, and in such event, Licensee shall have the right, in
\naddition to any and all other rights and remedies the Licensee has against
\nLicensor by reason of the same, to set off any and all damages, costs, expenses,
\nlosses and other injuries sustained by Licensee by reason of such
\nmisrepresentation or breach against any sums payable by Licensee to Licensor
\nunder this Agreement.<\/p>\n
11.4 Neither Ricky Lauren nor Mark N. Kaplan, nor any prior or
\nsuccessor trustee or trustees, shall assume any personal liability under this
\nAgreement, except for material misrepresentations herein contained, and the
\nLicensee is limited in any recovery to the assets of the Licensor.<\/p>\n
12. Licensor’s Right of Approval.<\/p>\n
Licensor has been given the right of approval in this Agreement with
\nrespect to various actions and classes of actions which may be taken or are
\nproposed to be taken by Licensee during the term hereof. In all instances where
\nLicensor has such a right of approval under this Agreement, such right may be
\nexercised by either Ricky Lauren or Mark N. Kaplan, acting alone (or by any
\nsuccessor of either of them<\/p>\n
41
\n 38<\/p>\n
as Trustee under an Agreement dated September 21, 1976, also acting alone). If
\nLicensor fails or is unable to exercise such right within thirty (30) days (by
\ninforming Licensee whether Licensor grants or withholds its said approval)
\nLicensor shall be deemed to have given its approval to Licensee with respect to
\nthe matter as to which its approval was sought.<\/p>\n
13. Further Assurances.<\/p>\n
Each of the parties hereto forthwith upon request from the other
\nshall execute and deliver such documents and take such action as may be
\nreasonably requested in order fully to carry out the intent and accomplish the
\npurposes of this Agreement.<\/p>\n
14. Notices.<\/p>\n
All notices, approvals or other communications required under or
\ncontemplated by this Agreement shall be in writing and shall be deemed given
\nwhen transmitted by telex (with confirmed answerback) or delivered in person or
\nsent, postage prepaid, by registered or certified mail, return receipt
\nrequested, as follows:<\/p>\n
(a) If to Licensor, addressed as follows:
\n Ricky Lauren
\n 1107 Fifth Avenue
\n New York, New York 10028<\/p>\n
42
\n 39<\/p>\n
with a copy to:<\/p>\n
Mark N. Kaplan, Esq.
\n Skadden, Arps, Slate, Meagher & Flom
\n 919 Third Avenue
\n New York, New York 10022
\n Telex: 645899<\/p>\n
(b) If to Licensee, addressed as follows:<\/p>\n
Cosmair, Inc.
\n 530 Fifth Avenue
\n New York, New York 10036
\n Attention: President
\n Telex: 421973 COS UI<\/p>\n
with a copy to:<\/p>\n
John F. Flaherty, Esq.
\n Gibney Anthony & Flaherty
\n 420 Lexington Avenue
\n New York, New York 10170
\n Telex: 649388<\/p>\n
Any party to this Agreement may change the address to which notices or other
\ncommunications are to be sent to it hereunder by notice similarly given.<\/p>\n
15. Binding Effect.<\/p>\n
This Agreement shall be binding upon and inure to the benefit of
\nsuccessors and permitted assigns of the parties hereto.<\/p>\n
16. Governing Law.<\/p>\n
This Agreement shall be construed and governed in accordance with
\nthe internal laws of the State of New York without regard to choice of law
\nprovisions.<\/p>\n
43
\n 40<\/p>\n
17. Entire Agreement.<\/p>\n
This Agreement contains the entire agreement between the parties
\nhereto with respect to the transactions contemplated hereby and may not be
\nchanged or terminated orally. No modification or waiver of any provisions hereof
\nshall be valid unless signed by the party to be charged therewith.<\/p>\n
18. Severability.<\/p>\n
The provisions of this Agreement are severable, and if any provision
\nshall be held invalid or unenforceable in whole or in part in any jurisdiction,
\nthen such invalidity or unenforceability shall affect only such provision, or
\npart thereof, in such jurisdiction and shall not in any manner affect such
\nprovision in any other jurisdiction, or any other provision in this Agreement in
\nany jurisdiction.<\/p>\n
19. Counterparts.<\/p>\n
This Agreement may be executed in one or more counterparts, each of
\nwhich shall be deemed to be an original, but all of which together shall
\nconstitute one and the same instrument.<\/p>\n
44
\n 41<\/p>\n
IN WITNESS WHEREOF, the parties hereto have executed this Agreement,
\nor caused the same to be executed by a duly authorized person as of the 1st day
\nof January, 1985.<\/p>\n
COSMAIR, INC.<\/p>\n
Date: October 8, 1985 By: \/s\/ Jacques H. Correze
\n —————————-<\/p>\n
Date: October 8, 1985 \/s\/ Ricky Lauren
\n ——————————
\n Ricky Lauren, as Trustee
\n under an Agreement dated
\n September 21, 1976<\/p>\n
Date: October 8, 1985 \/s\/ Mark N. Kaplan
\n ——————————
\n Mark N. Kaplan, as Trustee
\n under an Agreement dated
\n September 21, 1976<\/p>\n
45
\n SCHEDULE A-1<\/p>\n
LICENSOR’S TRADEMARK<\/p>\n
(as of November 22, 1976)<\/p>\n
Polo by Ralph Lauren 1,021,368 Class 51 (Int. Cl. 3) After-shave lotion
\n and toilet water.<\/p>\n
46
\n SCHEDULE A-2<\/p>\n
PFI’S TRADEMARKS<\/p>\n
(as of November 22, 1976)<\/p>\n
\n\n Registration
\nTrademarks No. Class Products
\n———- ————- —– ——–
\n
\nPolo Class 39 Men’s suits,
\n By Ralph Lauren 978,166 (Int. Cl. 25) slacks, ties,
\n sweaters, shoes,
\n shirts, hats, belts,
\n socks; and ladies’
\n blouses, skirts,
\n suits and dresses.
\nPolo Class 26 Frames for
\n By Ralph Lauren prescription and
\n non-prescription
\n lenses and
\n complete
\n sunglasses.
\nRalph (Polo Player 984,005 Class 39 For suits,
\n Design) Lauren (Int. Cl. 25) overcoasts,
\n sweaters, ties,
\n shirts and pants.
\nCHAPS 1,016,955 Class 39 Jackets, pants,
\n BY RALPH (Int. Cl. 25) suits and slacks.
\n LAUREN
\n<\/c><\/c><\/c><\/s><\/caption>\n<\/table>\n 47
\n SCHEDULE B<\/p>\n
LICENSED PRODUCTS<\/p>\n
Fragrances and Scents
\n———————<\/p>\n
Perfume
\nCologne
\nToilet Water
\nAftershave Lotion<\/p>\n
Cosmetic Preparations
\n———————<\/p>\n
Eyebrow Coloring
\nEye Highlighter
\nEyelashes
\nEyeliner
\nEyeshadow or Contour
\nMascara
\nLipstick
\nLip gloss
\nLip undercoat
\nCheek Color – Blushers, Gels, Rouges
\nFace powder
\nMake-up foundation\/Base\/Lightner
\nFalse fingernails
\nNail polish
\nNail hardener Nail polish
\nremover
\nCuticle remover\/Softener
\nNail polish undercoat\/Base coat
\nLeg and Body Make-up
\nMasks and Peelers\/Firmers
\nMassages
\nMake-up remover
\nFormulated special facial preparations
\nDepilatories
\nWrinkle, Line, Stretch mark, and Cellulite preparations<\/p>\n
48
\n 2<\/p>\n
Personal Hygiene Products
\n————————-<\/p>\n
Mouthwash\/Breath freshener\/Throat lozenges
\nUnderarm deodorant\/Antiperspirant
\nTalcum\/Bath powder\/Spray
\nBlemishes\/Pores\/Acne preparations
\nTherapeutic preparations
\nEyedrops (non-prescription)
\nFeminine hygiene deodorant
\nDouches Foot powder\/spray
\nBubble bath\/oil\/capsule
\nHand or body lotion\/oil\/cream<\/p>\n
Toiletries
\n———-<\/p>\n
Soap, plain\/deodorant
\nSuntan preparations\/sun screen\/bronzing agents
\nHair shampoo Shave cream\/Gel\/Soap
\nPre-shave\/beard softner
\nAstringents, Fresheners, Toners
\nHand, Face and Body cleansers
\nMoisturizers\/Protectors
\nLubricants\/Night preparations
\nBody preparations
\nAppliances\/Devices
\nApplicators
\nNail clippers and files
\nCuticle tools
\nCombs and Brushes
\nHair spray\/lacquer
\nHair color\/Dye\/Lightner
\nHair dressing
\nHair Setting\/Waving gel\/Solution
\nHome permanent
\nHair straightener\/relaxer
\nHair cream rinse\/conditioner<\/p>\n
49
\n Schedule C<\/p>\n
Ms. Ricky Lauren
\nMr. Ralph Lauren
\n1107 Fifth Avenue
\nNew York, New York 10028<\/p>\n
Mr. Mark N. Kaplan
\n919 Third Avenue
\nNew York, New York 10022<\/p>\n
Gentlemen:<\/p>\n
Reference is made to the restated fragrance and cosmetics trademark
\nlicense agreement, dated as of January 1, 1985 (the “License Agreement”),
\nbetween Ricky Lauren and Mark N. Kaplan (“Licensor”) and Cosmair, Inc.
\n(“Cosmair”), a corporation organized under the laws of Delaware. Cosmair wishes
\nto create a corporation under the name _______________ (“Subsidiary”), pursuant
\nto which it shall conduct operations relating to ________________ pursuant to
\nthe License Agreement. You are hereby requested to acknowledge below your
\nconsent to the use of the name “Ralph Lauren” as part of the foregoing corporate
\nname of Subsidiary, subject to the provisions hereinafter set forth.<\/p>\n
1. Cosmair agrees to promptly execute, deliver and\/or file and to
\ncause Subsidiary to promptly execute, deliver and\/or file (i) any documents
\nnecessary to effect the change of Subsidiary’s corporate name, so as to delete
\ntherefrom, the name “Ralph Lauren,” or any reference, direct or indirect,
\nthereto, as promptly as practicable after, but in no event later than the
\nearlier of (x) sixty (60) days after its receipt of a written communication from
\nLicensor or Ralph Lauren requesting that Subsidiary terminate its use of such
\nname or reference or (y) fifteen (15) days following the termination of the
\nLicense Agreement and (ii) any consents or similar instruments requested by
\nLicensor, Ralph Lauren or Polo Fashions, Inc. in connection with the use of the
\nname “Ralph Lauren” as part of a corporate name or tradename by any third party
\nor third parties. In conjunction with any change of name required hereunder,
\nCosmair shall cause Subsidiary to cease to use in any manner the name “Ralph
\nLauren” unless otherwise agreed. Licensor shall not unreasonably make a request
\npursuant to the foregoing clause (i) for Subsidiary to terminate its use of the
\naforementioned name.<\/p>\n
2. Cosmair agrees that for so long as the name “Ralph Lauren”
\ncomprises a part of Subsidiary’s corporate name, Subsidiary shall not engage or
\nbe involved, directly or indirectly, in any business other than the sale of
\nproducts manufactured by or under license from Licensor, such business to be
\nconducted only in accordance with the License Agreement.<\/p>\n
50
\nMs. Ricky Lauren
\nMr. Mark N. Kaplan
\nPage 2<\/p>\n
3. Cosmair recognizes that the name “Ralph Lauren” is associated
\nwith, and forms a part of, numerous registered trademarks and service marks
\npresently being used in connection with, among other things, various articles of
\nwearing apparel and free standing stores (the “Marks”). Cosmair further
\nacknowledges that the Marks have acquired valuable secondary meanings and
\ngoodwill with the public and that products and stores bearing the Marks have
\nacquired a reputation of high quality and style. To the extent any rights in and
\nto any of the Marks are deemed to accrue to Cosmair or Subsidiary by virtue of
\nthe adoption of the name “Ralph Lauren” by Subsidiary as part of its corporate
\nname, this letter agreement or otherwise, Cosmair shall cause any and all such
\nrights, at such time as they may be deemed to accrue, to be assigned to
\nLicensor. Cosmair and subsidiary will execute any instruments requested by
\nLicensor which Licensor deems necessary, proper or appropriate to accomplish or
\nconfirm the foregoing. Any such assignment, transfer or conveyance shall be
\nwithout consideration other than the mutual agreements contained herein.<\/p>\n
4. Cosmair agrees to cause Subsidiary, upon Subsidiary’s formation,
\nto execute an agreement by which Subsidiary will agree to be bound by the terms
\nof this letter agreement.<\/p>\n
51
\n 3<\/p>\n
Ms. Ricky Lauren
\nMr. Mark N. Kaplan
\nPage 3<\/p>\n
Without in any manner limiting any of the rights granted to Cosmair
\npursuant to the License Agreement, Cosmair hereby acknowledges and agrees that,
\nexcept as specifically provided herein, nothing contained in this letter
\nagreement shall be construed to grant Cosmair or Subsidiary the right or
\nauthority to (i) use any of the Marks for any purpose whatsoever or (ii) use the
\nname “Ralph Lauren.”<\/p>\n
Very truly yours, <\/p>\n
COSMAIR, INC.<\/p>\n
By:
\n ————————–<\/p>\n
AGREED AND CONSENTED TO:<\/p>\n
——————————-
\nRicky Lauren<\/p>\n
——————————-
\nRalph Lauren<\/p>\n
——————————-
\nMark N. Kaplan<\/p>\n
52
\n 4<\/p>\n
Conformed Copy<\/p>\n
COSMAIR, INC.
\n 530 Fifth Avenue
\n New York, New York 10036<\/p>\n
As of January 1, 1985<\/p>\n
Mr. Ralph Lauren
\n1107 Fifth Avenue
\nNew York, New York 10028<\/p>\n
and<\/p>\n
Polo Fashions, Inc.
\n40 West 55th Street
\nNew York, New York 10019<\/p>\n
Gentlemen:<\/p>\n
Reference is made (i) to a restated U.S.A. license agreement (the
\n“License Agreement”) dated as of January 1, 1985 between Cosmair, Inc., a
\nDelaware corporation (the “Licensee”), and Ricky Lauren and Mark N. Kaplan as
\ntrustees under an Agreement dated September 21, 1976 (the “Licensor”), which
\nLicense Agreement is being executed simultaneously herewith, and (ii) to a
\nU.S.A. design and consulting agreement (the “Design Agreement”) dated as of
\nJanuary 1, 1985 between Ralph Lauren (“Lauren”) individually and doing business
\nunder the name Ralph Lauren Design Studio, and Licensee, which Design Agreement
\nis being executed simultaneously herewith. The License Agreement and the Design
\nAgreement are hereinafter, at times, referred to collectively as the Agreements.<\/p>\n
In order to induce the Licensee to enter into the Agreements and to
\nperform the obligations imposed on the Licensee thereunder, the Licensor has
\nrequested Lauren and Polo Fashions, Inc., a New York corporation (“PFI”), to
\nconfirm to the Licensee certain representations, warranties, covenants and
\nacknowledgments, which representations, warranties, covenants and
\nacknowledgments have previously been made to the Licensor by Lauren and PFI.<\/p>\n
NOW, THEREFORE, the parties hereto agree as follows:<\/p>\n
1. Lauren and PFI, jointly and severally, hereby make the following
\nrepresentations and warranties to the Licensee, which are confirmatory of<\/p>\n
53
\n 2<\/p>\n
the rights received by the Licensor under various agreements (the “Transfer
\nAgreements”) among the Licensor, The Polo\/Lauren Company (“PLC”), Lauren and PFI
\neach of which shall be deemed to be independently material and relied upon by
\nthe Licensee, regardless of any investigation made or information obtained by
\nthe Licensee:<\/p>\n
(a) By operation of the assignments and conveyances in the
\nTransfer Agreements, as of November 22, 1976 the Licensor became the sole owner
\nof the trademark “Polo by Ralph Lauren,” United States Patent Office
\nRegistration No. 1,021,368 covering certain products in U.S. Class 51 (as more
\nfully set forth on Schedule A-1 to the License Agreements).<\/p>\n
As of November 22, 1976, PFI was the registered owner of, and Lauren
\nhad consented to the use of his name in connection with the registration of, the
\ntrademarks (i) “Polo (with design) by Ralph Lauren,” United States Patent Office
\nRegistration No. 978,166 covering certain products in U.S. Class 39, (ii) “Ralph
\nLauren” (and Polo Player Design), United States Patent Office Registration No.
\n984,005 covering certain products in U.S. Class 39, (iii) “Chaps by Ralph
\nLauren,” United States Patent Office Registration No. 1,016,955 covering certain
\nproducts in U.S. Class 39 and (iv) “Polo by Ralph Lauren” covering certain
\nproducts in U.S. Class 26. PFI and Lauren, by written statement duly executed by
\nthem in favor of Licensors, have given their consent and agreement to interpose
\nno objection to the registration, use and licensing of the foregoing trademarks,
\nthe Names and all other names and marks, which either or both (or any business
\nentity which is now or hereafter owned or controlled, directly or indirectly, by
\neither or both of them), may hereafter develop or own (except such other names
\nand marks as are not used in connection with any fashion related product) in
\nconnection with the manufacture and\/or distribution and sale of Licensed
\nProducts, as contemplated by the License Agreement;<\/p>\n
(b) Licensor has the full right, power and authority to
\nexecute and deliver, and perform the terms of, the License Agreement and the
\nconsummation of the transactions contemplated by the License Agreement will not
\nviolate any agreement to which Licensor, Lauren or PFI is a party or by which
\nthey, it or he may be bound;<\/p>\n
(c) Without limiting the generality of the last preceding
\nsubparagraph, Licensor has the full right to grant the License and neither
\nLicensor, Lauren nor PFI is a party to or bound by any agreement in conflict
\nwith the License Agreement or with any provision thereof. Except as may be
\nprovided in the Agreements, neither Licensor, Lauren nor PFI has granted to any
\nother person, firm, corporation or business any right, license or privilege to
\nuse the Names or associated crests, symbols, logos or identifying marks, or any
\ncrest, symbol, logo or identifying marks which would be confusingly similar
\nthereto in connection with any Licensed<\/p>\n
54
\n 3<\/p>\n
Product, or which would have the effect of infringing upon the exclusivity of
\nthe License granted to Licensee under the License Agreement;<\/p>\n
(d) Schedules A-1 and A-2 to the License Agreement contain a
\nfull and complete list of all registrations existing as of November 22, 1976
\ncovering the Current Names and associated crests, symbols, logos and identifying
\nmarks in the class of use owned by or registered in the name of Licensor, Lauren
\nand\/or PFI in any part of the world; and<\/p>\n
(e) To the best of Lauren’s and PFI’s knowledge as of November
\n22, 1976 (without any representation of an investigation having been made) no
\nperson other than Licensor, Lauren of PFI had as of November 22, 1976 any trade
\nname, trademark or similar right or interest in or to the “Ralph Lauren,” “Polo”
\nand “Chaps” Names as applied to Licensed Products in the Territory.<\/p>\n
2. In further confirmation of their prior transfer of rights to
\nLicensor, Lauren and PFI, jointly and severally, covenant and agree with
\nLicensee as follows:<\/p>\n
(a) Lauren and PFI will not, and will not permit any business
\nentity owned or controlled by them to, grant any person, firm, corporation or
\nbusiness (other than Licensee) any right, license or privilege to use in the
\nTerritory the Names or associated crests, symbols, logos or identifying marks or
\nany name, crest, symbol, logo or identifying mark which would be confusingly
\nsimilar thereto in connection with any Licensed Product, or which would have the
\neffect of infringing upon the exclusivity of the License granted to Licensee
\nunder the License Agreement;<\/p>\n
(b) Lauren and PFI hereby confirm Licensor’s authority to
\nappoint Licensee as its attorney-in-fact to apply for and register, in
\naccordance with the provisions of the Agreements, in the name of Licensor, in
\nthe Territory all trade names and trademarks which make use of the Names or are
\nassociated therewith as applied to Licensed Products. Lauren and PFI will
\ncooperate with Licensee in all manners and respects, but at Licensee’s expense,
\nto enable Licensee to obtain the aforesaid registrations, and Lauren and PFI
\nwill execute any further agreements, documents and instruments as may be
\nnecessary to effect the same;<\/p>\n
(c) Lauren and PFI will not at any time disclose to any
\nperson, firm, corporation or business (other than to a person, firm, corporation
\nor business with rights to use the Names on Licensed Products outside the
\nTerritory, if required in connection with a program for the Licensed Products
\noutside the Territory) any confidential information (including, without
\nlimitation, customer lists) concerning the conduct of the business and affairs
\nof Licensee or of any subsidiary or affiliate of Licensee which they may acquire
\nexcept as may be required pursuant to law and then only upon advance notice to
\nLicensee;<\/p>\n
55
\n 4<\/p>\n
(d) Lauren and PFI shall protect, indemnify and save harmless
\nLicensee and each of Licensee’s officers, directors, employees and agents
\nagainst any and all liabilities, claims, damages, penalties, causes of action,
\ncosts and expenses, including reasonable attorneys’ fees, arising out of the
\nbreach or material inaccuracy of any of the representations, warranties,
\ncovenants and agreements of (x) Licensor contained in the License Agreement or
\n(y) Lauren or PFI, contained in this letter. Licensee shall have the right in
\nits discretion, and with counsel of its own choosing, to take any action, legal
\nor otherwise, in its own name and\/or in the name of Lauren or PFI, at Licensee’s
\ndiscretion to protect any trade name or trademark covered by the License from
\ninfringement, counterfeiting or passing off. Prior to taking any such action,
\nLicensee shall advise Licensor of its intention to commence the proposed action
\nand thereafter, at Lauren or PFI’s request, shall promptly furnish Lauren and\/or
\nPFI with copies of relevant documents and Lauren and PFI advised of developments
\nrelating to the action. Lauren and PFI shall cooperate with Licensee, and if
\nrequested shall join in as a plaintiff in any such action with counsel
\ndesignated by Licensee. Any legal expenses incurred in the prosecution of such
\naction shall be borne by, and any money recoveries received in such action,
\nshall belong to, Licensee (subject only to the rights, if any, of Licensor to a
\nroyalty on any such recovery as expressly provided in the License Agreement);<\/p>\n
(e) Lauren and PFI acknowledge that the Current Names have
\nestablished prestige and good will in the field of fashion apparel and that it
\nis of major importance to Licensee that the high standards and reputation of the
\nCurrent Names be maintained. Neither Lauren nor PFI will take action which will
\nbe likely to injure or damage the reputation for high quality which has come to
\nbe associated with the Current Names. Licensee shall not be entitled to damages
\nby reason of Lauren’s or PFI’s breach or default of their obligations under this
\nsubparagraph (e) and Licensee’s sole remedy under the Agreements shall be to
\nterminate the Agreements pursuant to the provisions thereof.<\/p>\n
(f) Lauren and PFI believe and intend that they have
\ntransferred and assigned to Licensor all rights required by Licensor to enable
\nLicensor to fully perform its obligations under the License Agreement.
\nNevertheless, in confirmation thereof, if Lauren or PFI or any entity owned or
\ncontrolled by them now has or may hereafter acquire any right or interest in or
\nto any of the Names and if such right or interest is required to or should
\nproperly be owned by Licensor under the License Agreement or to otherwise fully
\nperform Licensor’s obligations thereunder, then, and in such event, the
\nfollowing provisions shall apply:<\/p>\n
(i) Lauren and PFI shall promptly transfer and assign
\n such right and interest to Licensor, without cost or expense to Licensee,
\n and (ii) for the purpose of the License Agreement and Licensee’s rights
\n thereunder, such rights and interests shall be deemed to be the property
\n of Licensor (whether or not they are actually assigned or transferred to
\n Licensor as provided in clause (i) above);<\/p>\n
56
\n 5<\/p>\n
(g) If Lauren or PFI hereafter registers any new Name in any
\npart of the world, they will promptly thereafter advise Licensee of the same;<\/p>\n
(h) Lauren will not permit his name to be used by any
\nUnaffiliated Third Person as the designer or creator of a line of clothing or
\nany other line of fashion related products owned, manufactured or distributed by
\nsuch Unaffiliated Third Person, unless such Unaffiliated Third Person agrees,
\nfor the benefit of Licensee, that neither Ralph Lauren’s name nor the name of
\nRalph Lauren as part of a trade name or trademark used for or in connection with
\nsuch line of clothing or other line of fashion related products will be used in
\nthe Territory by such Unaffiliated Third Person (or by any person licensed or
\nauthorized by him) for a line of Licensed Products or in connection with the
\nsale, distribution or promotion thereof. The term “Unaffiliated Third Person”
\nshall mean every person and business entity except Licensor, Lauren, PFI, PLC
\nand each business entity owned or controlled, directly or indirectly, by them;
\nand<\/p>\n
(i) In further confirmation of their prior transfer of rights
\nto Licensor, (i) Lauren and PFI do hereby join in each of the covenants and
\nagreements of Licensor contained in the License Agreements (including, without
\nlimitation, the covenants and agreements of the Licensor set forth in paragraphs
\n2.2, 7, 9.4 and 13 of the License Agreement and (ii) Lauren and PFI expressly
\nconsent to all of the other terms and conditions of the License Agreement and
\nwill deliver such documents and take such action as may be reasonably requested
\nin order to enable Licensor to fully carry out the intent and accomplish the
\npurposes of the License Agreement.<\/p>\n
3. Lauren and PFI hereby agree to indemnify and hold harmless
\nLicensee from and against any and all losses it may suffer and any and all
\ndamages, liabilities, claims, costs or expenses (including, without limitation,
\nreasonable attorneys’ fees and disbursements) paid or incurred, as the case may
\nbe, which it would not have suffered or incurred if PFI (rather than Licensor)
\nhad owned the Names and had applied for registration of the First Trademarks,
\nprovided, however that any such loss, damage, liability, claim, cost or expense
\nis paid or incurred by Domestic Licensee before PFI has filed applications in
\nits own name for registration of the First Trademarks. The parties acknowledge
\nthat the aforesaid indemnification provided by Lauren and PFI under this
\nparagraph 3 shall be the same as that provided to Licensee by the License
\npursuant to the provisions of paragraph 7.1(b) of the License Agreement. In the
\nevent any claim is made or accrued (to Licensees’ knowledge) against Licensee
\nwhich comes within the indemnity set forth in this paragraph, Licensee will
\npromptly notify Lauren and PFI of such claim. Thereafter, Licensor shall have
\nthe right, at its own expense and with counsel of its own choice, subject to the
\napproval of Licensee, which approval will not be unreasonably withheld, to
\nassume the defense of any such claim. Licensee agrees to cooperate fully in the
\ndefense of any such claim and may, at its own expense and with counsel of its
\nown choice, participate in the defense of any such claim.<\/p>\n
57
\n 6<\/p>\n
4. Licensee acknowledges that, except as set forth in paragraph 1
\nhereof, Lauren and PFI have not represented to Licensee that Licensor, Lauren or
\nPFI have any trademarks, trade names or other rights or interests in or to the
\nNames or that persons other than Licensor, Lauren or PFI have no such
\ntrademarks, trade names or other rights or interests. If Licensee uses any Name
\nas a trademark, trade name or product name for a Royalty Product without
\nregistration of the same (except as may be necessary to establish its use in
\ncommerce) Licensee will protect, defend and save harmless Lauren and PFI from
\nand against any claims of third persons for infringement, counterfeiting or
\npassing off against Lauren or PFI arising out of the use of such unregistered
\nName provided that (x) neither Lauren, PFI nor Licensor shall have
\nmisrepresented to Licensee their rights or interests in or to such Name whether
\nin this letter, in the License Agreement or any other instrument, and (y) such
\nclaim shall not arise by reason of any action taken by Lauren, PFI or Licensor
\nin breach of any obligation they may have to Licensee whether arising under this
\nletter, the License Agreement or any other instrument.<\/p>\n
5. In the event of a breach or threatened breach of any of the
\ncovenants of Lauren or PFI contained in this letter, Licensee shall have the
\nright, without the necessity of proving any actual damages, to obtain temporary
\nor permanent injunctive or mandatory relief in a court of competent
\njurisdiction, it being the intention of the parties to this Agreement that the
\ncovenants and agreements of Lauren and PFI hereunder be specifically enforced to
\nthe maximum extent permitted by law.<\/p>\n
If the representations of Lauren herein contained are not true and
\ncorrect in any material respect or if there shall be a substantial breach by
\nLauren of any of its covenants hereunder, which breach shall not have been cured
\nwithin ninety (90) days after Licensee shall have given Lauren notice of same,
\nsuch misrepresentation or breach shall be deemed and shall constitute a breach
\nof the Design Agreement, and Licensee shall have the right, in addition to any
\nand all rights and remedies that Licensee has against Lauren by reason of the
\nsame, to (i) terminate the Design Agreement and\/or (ii) set off any and all
\ndamages, costs, expenses, losses, and other injuries sustained by Licensee by
\nreason of such misrepresentation or breach against any sums payable by Licensee
\nunder the Design Agreement, except as otherwise provided in this letter or under
\nthe Design Agreement.<\/p>\n
6. In all instances where Lauren has a right of approval herein,
\nsuch right may be exercised personally by Lauren or by the Ralph Lauren Design
\nStudio. If Lauren or the Ralph Lauren Design Studio fails or is unable to
\nexercise such right within thirty (30) days (by informing Licensee whether
\nLauren grants or withholds his said approval) Lauren shall be deemed to have
\ngiven his approval to Licensee with respect to the matter as to which his
\napproval was sought.<\/p>\n
58
\n 7<\/p>\n
7. Licensee covenants and agrees with Lauren and PFI, as follows:<\/p>\n
(a) Licensee will not disclose to any person, firm,
\ncorporation, or business any confidential information concerning the conduct of
\nthe business and affairs of Lauren or PFI which Licensee may acquire; and<\/p>\n
(b) It is understood that Licensor, Lauren and PFI assume no
\nliability to Licensee or third parties with respect to the performance
\ncharacteristics of the Royalty Products, and Licensee will protect, defend,
\nindemnify and save harmless, Licensor, Lauren and PFI, their officers, employees
\nand agents, against any and all liabilities, claims, damages, penalties, causes
\nof action, costs and expenses, including reasonable attorneys’ fees and
\ndisbursements, for product liability or breach of warranty claims of third
\npersons arising out of the use of such Products by such third persons.<\/p>\n
8. All notices, approvals or other communications required under or
\ncontemplated by this Letter shall be in writing and (x) if given to Licensee,
\nLicensor or Lauren shall be delivered in the manner provided in the Agreements,
\nand (y) if given to PFI shall be transmitted by telex (with confirmed
\nanswerback) or delivered in person or sent, postage paid, by registered or
\ncertified mail, return receipt requested, as follows:<\/p>\n
Polo Fashions, Inc.
\n 40 West 55th Street
\n New York, New York 10019
\n Attention: President
\n Telex: 420747 POLOFAS<\/p>\n
with a copy to:<\/p>\n
Mark N. Kaplan, Esq.
\n Skadden, Arps, Slate, Meagher & Flom
\n 919 Third Avenue
\n New York, New York 10022
\n Telex: 645899<\/p>\n
9. All terms used in this Letter Agreement shall be defined or the
\npurposes hereof as provided in the Agreements unless otherwise expressly defined
\nherein.<\/p>\n
59
\n 8<\/p>\n
10. This Letter Agreement supersedes a prior letter agreement made
\nand dated November 22, 1976 (executed on June 30, 1978) among Licensee (as
\nsuccessor to the rights of Warner\/Lauren Ltd.) and Lauren and PFI and the
\nrights, duties and obligations of the parties from this date forth shall be
\ngoverned by this Letter Agreement.<\/p>\n
Very truly yours, <\/p>\n
COSMAIR, INC.<\/p>\n
By: \/s\/Jacques H. Correze
\n ———————<\/p>\n
READ AND AGREED TO:<\/p>\n
\/s\/Ralph Lauren
\n—————–
\nRalph Lauren<\/p>\n
POLO FASHIONS, INC.<\/p>\n
By: \/s\/Peter Strom
\n —————<\/p>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8547],"corporate_contracts_industries":[9396],"corporate_contracts_types":[9613,9616],"class_list":["post-42943","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-polo-ralph-lauren-corp","corporate_contracts_industries-consumer__clothing","corporate_contracts_types-operations","corporate_contracts_types-operations__ip"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/42943","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=42943"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=42943"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=42943"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=42943"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}