TERMINATION AND SETTLEMENT AGREEMENT

          AGREEMENT, dated as of the 27th day of April 2006, among Iconix Brand
Group, Inc., a Delaware corporation (“Iconix”), Moss Acquisition Corp., a
Delaware corporation and wholly-owned subsidiary of Iconix (“MAC”), and
Cherokee, Inc. a Delaware corporation (“Cherokee”).

W I T N E S S E T H :

          WHEREAS, Iconix entered into an Agreement and Plan of Merger dated as
of March 31, 2006, with MAC, Mossimo, Inc., a Delaware corporation (“Mossimo”),
and Mossimo Giannulli, the majority stockholder of Mossimo (the “Merger
Agreement”); and

          WHEREAS, Mossimo and Cherokee have entered into that certain
Cherokee-Mossimo Finders Agreement dated March 27, 2000 (the “Finders
Agreement”); and

          WHEREAS, subsequent to the execution of the Merger Agreement, Cherokee
issued a non-binding public proposal on April 17, 2006 to acquire all the
outstanding shares of Mossimo (the “Unsolicited Proposal”); and

          WHEREAS, Cherokee has determined to withdraw the Unsolicited Proposal
pursuant to the terms and subject to the conditions set forth herein;

          NOW, THEREFORE, in consideration of the foregoing premises and the
respective representations, warranties, covenants and agreements hereinafter set
forth, the parties hereto hereby agree as follows:

          1. Termination of Finders Agreement. Upon satisfaction of the
conditions of Section 4 of this Agreement and simultaneous with the effective
time of the merger (the “Closing Date” or the “Termination Date”) (i) the
Finders Agreement shall be terminated in its entirety and be of no further force
or effect and (ii) Iconix will pay to Cherokee by wire transfer in immediately
available funds the sum of Thirty-Three Million Dollars ($33,000,000) (the
“Termination Fee”).

          2. Representations and Warranties.

                    2.1 Representations and Warranties of Iconix. Iconix hereby
represents and warrants that (a) this Agreement has been duly authorized,
executed and delivered by Iconix and is the valid and binding obligation of
Iconix, enforceable against Iconix in accordance with its terms and (b) no
consent of any third party is required for the execution, delivery and
performance of this Agreement by Iconix.

                    2.2 Representations and Warranties of Cherokee. Cherokee
hereby represents and warrants that: (a) this Agreement has been duly
authorized, executed and delivered by Cherokee and is the valid and binding
obligation of Cherokee, enforceable against Cherokee in accordance with its
terms; (b) the Finders Agreement is in full force and effect and is a valid and
binding obligation of Cherokee and Cherokee is not in material violation of or
in default of any term or condition of the Finders Agreement; (c) Cherokee’s
right, title, or interest in the Finders Agreement or any amounts due thereunder
has not been pledged, assigned, hypothecated, subjected to any lien or security
interest, or encumbered in any manner whatsoever; and (d) no consent of any
third party is required for the execution, delivery and performance of this
Agreement by Cherokee.

          3. Covenants of Cherokee. Cherokee hereby covenants and agrees that:

                    3.1 Immediately after execution of this Agreement, Cherokee
shall withdraw the Unsolicited Proposal and notify Mossimo in writing of such
withdrawal. In addition, unless the Merger Agreement shall have been terminated,
Cherokee agrees not to, directly or indirectly, through any affiliate or
otherwise, reinstate or make any new offer to purchase shares of Mossimo capital
stock or any other type of acquisition of all, or substantially all, of the
capital stock or assets of Mossimo, whether by merger or any other type of
business combination with Mossimo or otherwise.

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                    3.2 From and after the date hereof, Cherokee shall not
interfere with the consummation of the Merger Agreement, and hereby agrees to
vote any and all shares of Mossimo common stock owned or held by it or any
affiliate in favor thereof. From the date of this Agreement through the
Termination Date, other than in the ordinary course of business, Cherokee
further agrees not to take any action or omit to take any action which would
adversely affect the relationship of Mossimo or Iconix or any of their
respective affiliates with Target Brands, Inc., or its affiliates. Cherokee
agrees that Cherokee and its affiliates will take no action which is intended
to, or would reasonably be expected to, harm or disparage Mossimo or Iconix or
any of their affiliates.

                    3.3 From and after the date of this Agreement through the
Closing Date, Cherokee shall not pledge, assign, sell, lease, license, mortgage,
hypothecate, or otherwise encumber or subject to any lien or security interest
in any manner whatsoever its right, title, or interest in the Finders Agreement
or any amounts due Cherokee thereunder.

          4. Covenants of Iconix. Iconix hereby covenants and agrees that:

                    4.1 Iconix agrees to use its best efforts to cause all
conditions precedent to its obligations (and to the obligations of the other
parties under the Merger Agreement to consummate the transactions contemplated
thereby) to be satisfied, including, but not limited to, using best efforts to
obtain all required (if so required by the Merger Agreement) consents, waivers,
amendments, modifications, approvals, authorizations, notations and licenses.

                    4.2 From the date of this Agreement through the Termination
Date, other than in the ordinary course of business, Iconix further agrees not
to take any action or omit to take any action which would adversely affect the
relationship of Cherokee or any of its affiliates with Target Brands, Inc., or
its affiliates. Iconix agrees that Iconix and its affiliates will take no action
which is intended to, or would reasonably be expected to, harm or disparage
Cherokee or any of its affiliates.

          5. Conditions to Closing. The closing of the transactions contemplated
by this Agreement and the payment of the Termination Fee shall take place upon
the satisfaction of the following conditions:

                    5.1 Cherokee shall have timely withdrawn the Unsolicited Bid
and otherwise complied with all of the covenants set forth in Section 3 hereof.

                    5.2 The Merger Agreement shall have been consummated and the
Effective Time (as such term is defined in the Merger Agreement) shall have
occurred.

                    5.3 The representations and warranties of Cherokee set forth
in Section 2 shall be true and correct in all respects as of the date of the
Closing.

          6. Net Revenues. In the event that the closing under the Merger
Agreement occurs, Iconix shall cause MAC to promptly pay Cherokee all earned but
unpaid Finder’s Fees (as such term is defined in the Finders Agreement) through
and including the Closing Date of this Agreement; provided, however, that Net
Revenues (as that term is defined in the Finders Agreement) shall not be reduced
by the payment to Target referenced in the Current Report on Form 8-K filed by
Mossimo on March 31, 2006 and due on or before June 30, 2006.Payment of such
Finder’s Fees shall be accompanied by a written report setting forth the Net
Revenues actually received by Mossimo (broken down by date and amount received)
since the date of the last report delivered to Cherokee by Mossimo and such
other information as is necessary to enable Cherokee to verify the Net Revenues
reported by Iconix and/or Mossimo. Finder’s Fees shall be payable in United
States Dollars. Interest at the maximum legal rate shall be paid on any Finder’s
Fees not paid when due.

          7. Liquidated Damages; Termination.

                    7.1 In the event that the Merger Agreement is terminated
pursuant to Section 7.1(a), 7.1(d) or 7.1(g), Iconix shall pay to Cherokee the
sum of One Million Dollars ($1,000,000) as liquidated damages within two
business days of such termination. Upon receipt by Cherokee of the payment
required by Section 7 subsequent to the

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termination of the Merger Agreement, the obligations of the parties hereto shall
expire and be of no further force or effect, except for the provisions of
Sections 7, 8 and 9 hereof, which shall survive.

                    7.2 In the event that the Merger Agreement is terminated for
any reason other than as specified in Section 7.1, then the obligations of the
parties hereto shall expire and be of no further force or effect, except for the
provisions of Sections 7, 8 and 9 hereof, which shall survive.

          8. Releases.

                    8.1 Releases by Cherokee. Effective as of the Closing Date,
Cherokee for itself and for each of its respective past and present agents,
officers, directors, employees, attorneys, shareholders, parents, subsidiaries,
and each of their affiliated legal or business entities, insurers, successors
and assigns, both individually and in their representative capacities (jointly
and severally the “Cherokee Releasing Parties”) hereby jointly and severally,
release and discharge Iconix, Mossimo and each of their affiliates, parents,
subsidiaries, officers, directors, stockholders, employees, agents, attorneys,
accountants and other advisors, and the heirs, executors and administrators, if
applicable, and the predecessors, successors or assigns of each of the foregoing
(collectively the “Cherokee Released Parties”) from all actions, causes of
action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills,
specialties, covenants, contracts, controversies, agreements, promises,
variances, trespasses, damages, judgments, extents, executions, claims, and
demands whatsoever (“Claims”), in law or equity, which against any or all of the
Cherokee Released Parties, any or all of the Cherokee Releasing Parties ever
had, now have or hereafter can, shall or may have, for, upon, or by reason of
any matter, cause or thing whatsoever from the beginning of the world to the
Termination Date arising out of or relating to the Finders Agreement or its
termination.

                    8.2 Release by Iconix. Effective as of the Closing Date,
Iconix, for itself and for each of its respective past and present agents,
officers, directors, employees, attorneys, shareholders, parents, subsidiaries,
and all of its affiliated legal or business entities, insurers, successors and
assigns, both individually and in their representative capacity (jointly and
severally the “Iconix Releasing Parties”) hereby jointly and severally, release
and discharge Cherokee and each of its affiliates, parents, subsidiaries,
officers, directors, stockholders, employees, agents, attorneys, accountants and
other advisors, and the heirs, executors and administrators, if applicable, and
the predecessors, successors or assigns of each of the foregoing (collectively
the “Iconix Released Parties”) from all Claims, in law or equity, which against
any or all of the Iconix Released Parties, any or all of the Iconix Releasing
Parties ever had, now have or hereafter can, shall or may have, for, upon, or by
reason of any matter, cause or thing whatsoever from the beginning of the world
to the Termination Date arising out of or relating to the Finders Agreement or
its termination.

                    8.3 Exceptions, Indemnification. Notwithstanding anything
contained in this Section 8 to the contrary, this Section 8 shall not apply to
any Claims arising out of breach of the obligations contained in this Agreement.
Each of Iconix and Cherokee hereby agree to indemnify and hold the other
harmless from any and all loses, liabilities, expenses and costs (including
reasonable attorneys’ fees) arising out of, resulting from, or relating to
(a) any breach of any representation or warranty made herein by such party or
(b) any breach of any covenant or agreement made by any party herein.

          9. Miscellaneous.

                    9.1 Notices. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given or made as of the date delivered or mailed if delivered personally or
mailed by registered or certified mail, postage prepaid, return receipt
requested, to the parties at their respective addresses set forth below:

 

 

 

 

 

If to Iconix or MAC:

 

 

 

 

With a copy to:

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Iconix Brand Group, Inc.
1450 Broadway, 4th Floor
New York, New York 10018
Attn: Neil Cole, CEO
Fax: (212) 391-0127

Blank Rome LLP
405 Lexington Avenue
New York, New York 10174
Attn: Robert J. Mittman, Esq.
Fax: (212) 885-5001

 

 

 

 

If to Cherokee:

With a copy to:

 

 

 

 

 

Cherokee, Inc.
6835 Valjean Avenue
Van Nuys, CA 91406
Attn: Robert Margolis, Chairman & CEO
Fax: (818) 908-9191

Morrison & Foerster LLP
12531 High Bluff Drive, Suite 100
San Diego, CA 92130
Attn: Scott M. Stanton
Fax: (858) 523-5941

                    9.2 Press Release. Immediately following the execution and
delivery of this Agreement,Cherokee and Iconix shall each issue a press release
announcing the execution of this Agreement, which press releases shall be
subject to the prior review and approval of the other party. None of the parties
hereto will make any public statements (including in any filing with the SEC or
any other regulatory or governmental agency, including any stock exchange) that
are inconsistent with, or otherwise contrary to, the statements in the press
Rrleases issued pursuant to this Section 9.2.

                    9.3 Entire Agreement. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter hereof, and
supersedes all prior agreements and understandings of the parties, oral and
written, with respect to the subject matter hereof.

                    9.4 Choice of Law/Governing Law. This Agreement shall be
construed and enforced in accordance with the internal laws of the State of
Delaware without reference to its conflicts of laws provisions.

                    9.5 Further Assurances. The Parties hereto agree to, at
their own expense, execute and deliver such other instruments of conveyance,
transfer or termination and take such other actions as any other party may
reasonably request, including obtaining the signatures of parties not Party to
this Agreement, in order to more effective consummate the transactions
contemplated hereby.

                    9.6 Amendment. This Agreement may only be modified by a
written instrument, which is executed by each of the parties hereto.

                    9.7 Severability. This Agreement shall be deemed severable,
and the invalidity or unenforceability of this Agreement or any other term or
condition hereof shall not affect the validity or enforceability of this
Agreement or of any other term or provision hereof. Furthermore, in lieu of any
such invalid or unenforceable term or provision, the parties hereto agree that
there shall be added as a part of this Agreement a provision as similar in terms
to such invalid or unenforceable provision as may be possible and be valid and
enforceable.

                    9.8 Headings. The headings contained herein are for the sole
purpose of convenience of reference, and shall not in any way limit or affect
the meaning or interpretation of any of the terms of this Agreement.

                    9.9 Binding Effect; Benefit. This Agreement shall inure to
the benefit of, and be binding upon, the parties hereto and their respective
heirs, legal representatives, successors and assigns.

                    9.10 Counterparts and Facsimile. This Agreement may be
executed in one or more counterparts, each of which shall be deemed to be an
original but all of which together will constitute one and the same instrument.
For purposes of this Agreement signatures received by facsimile shall have the
same force and effect as original signatures.

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          IN WITNESS WHEREOF, this Agreement has been executed and delivered by
the parties hereto as of the date first above written.

 

 

 

 

 

ICONIX BRAND GROUP, INC.

 

 

 

By:

/s/ Neil Cole

 

 

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Name:

Neil Cole

 

 

Title:

President and CEO

 

 

 

 

 

MOSS ACQUISITION CORP.

 

 

 

 

By:

/s/ Neil Cole

 

 

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Name:

Neil Cole

 

 

Title:

President

 

 

 

 

 

CHEROKEE, INC.

 

 

 

By:

/s/ Robert Margolis

 

 

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Name:

Robert Margolis

 

 

Title:

Chairman and CEO

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