**Exhibit 10.9****TRADEMARK LICENSE AGREEMENT**     THIS AGREEMENT (hereinafter “Agreement”) is effective as of November 27, 2002(hereinafter “Effective Date”) by and between:     Tyler Trafficante Inc., a corporation organized and existing under the laws of the State ofCalifornia, located at 2001 Saturn Street, Monterey Park, California 91755(hereinafter"LICENSOR”), and The Fashion House, Inc., a corporation organized and existing underthe laws of the State of Delaware, located at 489 South Robertson Boulevard, Suite 205, BeverlyHills, California 90212 (hereinafter “LICENSEE”).     WHEREAS, LICENSOR is the owner of the trademark “Richard Tyler”, and certain simulations andvariations thereof as set forth on Schedule I annexed hereto and incorporated herein by reference(hereinafter referred to collectively as the “Marks”);     WHEREAS, LICENSEE desires to obtain a license from LICENSOR to use the Marks on theLicensed Products (as hereinafter defined) in the Territory (as hereinafter defined);     WHEREAS, LICENSEE acknowledges that the Marks and associated goodwill are of greatsignificance and value to LICENSOR and that strict adherence to the quality control standardsprovided in this Agreement is essential to the maintenance of the significance and value of theMarks and associated goodwill; and     WHEREAS, LICENSEE pledges its active cooperation in and support of LICENSOR’S marketingprograms, the spirit and intent of which are to maintain and enhance the value and significanceof the Marks throughout the world.     NOW, THEREFORE, in consideration of their mutual covenants, undertakings and promisescontained herein, and other good and valuable consideration, the receipt and adequacy of which theparties hereby acknowledge, the parties agree as follows:**1. DEFINITIONS**In this Agreement, the following terms shall have the meanings set forth below:     1.1 **“Competitor”**shall mean those trademarks, trade names or other identifying words orsymbols of any third party clothing designer which are used on products which are similar to theLicensed Products in category, image, quality and price points, and which are sold throughdistribution channels of the same like and kind as the Licensed Products.
 

 
     1.2 **“Inventory”**shall be any and all remaining (i.e. on hand or in stock) Licensed Productsand tangible items bearing the Marks, including but not limited to, raw material, work in process,labels, tags, etc.     1.3 **“Licensed Product(s)”**shall be women’s shoes and boots, including fashion sports shoes butexpressly not including athletic shoes.     1.4 **“Net Sales”**shall mean the gross dollar amount of all sales by LICENSEE of the LicensedProducts (hereinafter **“Gross Sales” )**less the following items insofar as they are separatelystated but included in the amounts invoiced to customers: usual trade discounts actually taken,returns and allowances. No costs incurred in the manufacture, sale, distribution, advertisement,or promotion of the Licensed Products shall be deducted from Gross Sales or from any Royalty(defined below) payable to LICENSOR, except as otherwise expressly set forth herein. Local, Stateor Federal taxes of any nature whatsoever including, without limitation, tariffs, sales tax, usetaxes, value added and inventory taxes, shall not be included in Gross Sales, or deducted fromGross Sales *for*purposes *of*computing Net Sales. Net Sales shall include thesale of Secondary Goods (as defined below), but shall not include the sale of samples toLICENSEE’S Licensed Product sales force.     Except as otherwise expressly set forth herein, any sales or transfers of Licensed Productsmade by LICENSEE to any person or entity that does not deal at arm’s length with LICENSEE shallbe computed, for the purpose of determining Net Sales, at an amount equal to the price at whichLICENSEE would have invoiced or charged purchasers who deal at arm’s length with LICENSEE and allRoyalties shall be paid to LICENSOR thereon.     1.5 **“Notice Address”**shall be the addresses set forth for the parties at the beginning of thisAgreement, or such other addresses as a party may hereafter designate to the other party in writingfrom time to time. At no time shall LICENSEE have a notice address outside of the United States.     1.6 “Territory” shall be Worldwide. Licensee will have 24 months from the effective date ofthis License Agreement to exploit the Japanese market or Licensor shall have the right to assignanother Licensee for Japan.     1.7 **“Use” (or “Used,” “Uses” or “Using”)**shall mean (1) the placement of the Marks on theLicensed Products; and (2) the use of the Marks in the broadest sense of publication, that is anyvisual and aural form which to the average person would indicate that the Licensed Products areassociated with the Marks, including, but not limited to, print media, labels, tags, point of saleand showroom displays, signage, packaging, stationery, business cards and forms, and electronicmedia now known or hereafter devised, and the form and content of the subject matter associatedwith all the aforementioned; and (3) all other uses of the Marks approved by
 

 
LICENSOR in writing prior to the use.     1.8 **“Material Term”**shall include any numbered provision within the paragraphs headed“Minimums and Payment,” “Reporting, Accounting and Auditing,” and “Quality Standards,” a breach ofany of which shall be deemed “material.”     1.9 **“Advertising”**shall include expenditures made in connection with the public promotion,through standard media, of the Licensed Product for sale anddistribution, and shall not include coop advertising and sales promotions. “Advertising” shall not include anyexpense incurred in connection with the preparation and/or construction or dismantling of abooth at any trade show, or entertainment expenses.     1.10 **“Close-Out Sales”**shall mean Sales of Licensed Merchandise for less than 50% of itsregular wholesale price made to the following approved retailers: Marshall’s, T.J.Maxx,Loehman’s, Ross Stores, Syms, Daffy’s, Century 21, Filene’s Basement, and Luggage FactoryOutlet, as well as to such other discount retailers as LICENSOR shall hereafter approve in itssole discretion in writing.     1.11 **“Season”**shall mean any of four seasons. Such seasons are: February (Fall),June(Resort), August (Spring), December (Prefall).**2. TERM**     2.1 TERM: Subject to the provisions of Article 1 I (Termination) herein, this Agreementshall continue in force for Five (5)years from the Effective Date . LICENSEE shall have theoption to extend the term of this Agreement for an additional period of Two (2) years provided:(i) LICENSEE is in full compliance with all the terms and conditions of this Agreementimmediately prior to the exercise of the option to renew, and (ii) LICENSEE gives LICENSORnotice of its desire to renew at least six (6) months prior to the end of the Initial Term,Unless otherwise agreed to by written amendment, the Option Term, if any, shall be upon the sameterms and conditions as provided for in this Agreement, excepting there shall be no furtherextension of the Initial Term without mutual agreement of the parties. Should LICENSOR at anytime exercise its right under this Agreement to terminate the rights of LICENSEE, all options toextend the term shall likewise be terminated.     2.2 LICENSED TERM, YEAR, AND QUARTER DEFINED: The Initial Term, Option Term, if any, and theWinding-Up Period (defined below), if any, shall collectively be referred to as the **“LicensedTerm”**or **“Term.”**The quarters of the Term shall be every three (3) month period.**3. GRANT OF LICENSE**     3.1 LICENSE: Subject to the provisions of this Agreement,
 

 
LICENSOR grants to LICENSEE, and LICENSEE accepts, an exclusive, nontransferable license toUse the Marks in the Territory only as specifically provided for in this Agreement including,but not limited to, the right to produce, sell and distribute the Licensed Products (hereinafter**“License”).**     3.2 BEST EFFORTS: During the Licensed Term, LICENSEE shall use its best efforts to exploit theLicense granted herein throughout the Territory, including, but not limited to, offering for saleLicensed Products so that they may be sold to the consumer on a timely basis; coordinating thecharacteristics and marketing of its Licensed Products with the products of LICENSOR’S otherlicensees; cooperating with LICENSOR and its licensees’ marketing and sales programs; and offeringa collection of the Licensed Products for sale in the Territory at all times for each and everyseason     3.3 ADDITIONAL RIGHTS TO LICENSE:     (A) LICENSEE acknowledges that LICENSOR has previously licensed the use or Use of the Marksin connection with products other than the Licensed Products to third parties and that LICENSORshall grant additional licenses in the future for territories or products that are not presentlylicensed and that are not within the scope of this License.     (B) For the purpose of this Section 3.3(B), when the term “LICENSEES” or “Licensees” is used,it is intended that said terms mean the whole or part of the whole group of all of LICENSOR’Slicensees, which includes LICENSEE. LICENSEE hereby acknowledges that, due to the nature of theindustry, precise definition of the scope of goods covered as Licensed Product is sometimes notpossible. LICENSEE therefore agrees to accept at all times the sole judgment of LICENSOR withrespect to whether a particular style, design or product is a Licensed Product within the scope ofthe License. LICENSEE agrees that it will not market, either directly or indirectly, any style,design or product which LICENSOR, in its sole discretion, determines is not a Licensed Productwithin the scope of the License. LICENSEE further agrees that in the event of a dispute between anyof the Licensees arising out of or based upon a claim that a product being manufactured or sold asa Licensed Product by one “Licensee” infringes upon the license granted by LICENSOR to another“Licensee,” regardless of the legal grounds upon which the cause of action or claim is based,LICENSOR shall reasonably and consistent with the terms and spirit of this License investigate theclaim and LICENSEE shall cooperate in all respects with said investigation. LICENSOR shall thensubmit to any affected Licensee a written determination, which may include a procedure formitigating any losses that might occur. Said determination and procedure shall be conclusive as toall parties including LICENSEE, and all shall be bound thereby without legal recourse.OPTION: In the event Licensor decides to License Men’s footwear Licensor shall advise Licensee inwriting of pending negotiations with a third party. Licensee shall come up with an acceptableproposal. If an agreement cannot be reached within 30 days, Licensor
 

 
shall have the right to enter into License for men’s shoes with a 3rd party.**4. MINIMUMS AND PAYMENT**     4.1 MINIMUM SALES VOLUMES: If LICENSEE’S Net Sales in the Territory do not reach thefollowing dollar volume levels for each Year of the Licensed Term (hereinafter “Minimum SalesVolumes”), then LICENSOR shall have the right, but not the obligation, to terminate thisAgreement:The Minimum Sales Volume shall be the greater of those figures established below or 75% of theaverage of the actual sales for the preceding two years.         Year One: (2003) $500,000     Year Two: (2004) $625,000     Year Three: (2005) $780,000     Year Four: (2006) $975,000     Year Five: (2007) $1,218,750              Option Terms        Year Six: (2008) $1,525,000     Year Seven: (2009) $1,906,250          Notwithstanding the preceding, LICENSEE may avoid termination of this Agreement for failureto meet the Minimum Sales Volumes in a given Year by paying the GMTR due for that Year asdefined below in Sections 4.2 and 4.3.     4.2 TRADEMARK ROYALTY:     (A) As a royalty, LICENSEE shall pay to LICENSOR a sum equal to seven percent (7%) of NetSales of the Licensed Products, except, as set forth in Paragraph 4.4 hereinbelow, theTrademark Royalty on Close-out goods shall be three percent (3%) (hereinafter **“TrademarkRoyalty”)**on a quarterly basis no later than the twentieth (20th) day of the month immediatelyfollowing the quarter in which said Net Sales are made.     (B) GUARANTEED MINIMUM TRADEMARK ROYALTY: Whether or not LICENSEE achieves the requiredMinimum Sales Volumes, LICENSEE shall pay to LICENSOR (as set forth in 4.2(C) below) the greaterof either the Trademark Royalty or the Guaranteed Minimum Trademark Royalty (hereinafter “GMTR”)as follows:The Minimum Trademark Royalty shall be the greater of those figures established below or 75% of theaverage of the actual royalty for the preceding two years.
 

 
         Year One: (2003) $35,000     Year Two: (2004) $43,750     Year Three: (2005) $54,600     Year Four: (2006) $68,250     Year Five: (2007) $85,300              Option Terms        Year Six: (2008) $106,750     Year Seven: (2009) $133,400          (C) Subject to the provisions of paragraph 4.5 below, the GMTR shall be paid in two equalpayments for each year (on January 1st and June 1st), with the exception of Year One where onepayment of $17,500 shall be made on February 2, 2003, and a second payment of $17,500 shall bepaid on June 1, 2003.     (D) All royalty payments (whether Trademark Royalty. Advertising Payment, or GMTR, hereincollectively referred to as **“Royalty” or “Royalties”)**shall be sent to Licensor via overnightcourier together with the Quarterly Report, defined hereinbelow, and shall be paid automaticallyby LICENSEE without billing therefore by LICENSOR.     (E) LICENSOR shall have the right to purchase such styles and quantities of Licensed Productfor its wholly owned retail stores as it desires. LICENSOR’S cost for all such purchases shall bediscounted Twenty Percent (20%) from LICENSEE’S regular wholesale prices. No royalty shall be dueto LICENSOR on such sales. Such sales do not count toward minimum sales volume. Notwithstandinganything to the contrary contained herein, LICENSOR shall have no obligation to purchase or sellany Licensed Product.     4.3 ADVERTISING EXPENDITURE: LICENSEE must spend, at a minimum, three percent (3%) of NetSales on advertising and/or public relations related to the Licensed Products **(“AdvertisingFunds”).**LICENSEE shall arrange for at least one print advertisement for the Licensed Products in aprestigious magazine with national distribution such as Glamour, Cosmopolitan, Elle, WWD, orMademoiselle annually during the Term. For the first year of the Term, LICENSEE shall spend atleast Fifteen Thousand ($15,000) Dollars as Advertising Funds. All Advertising Funds shall be inaddition to all other payments due LICENSOR hereunder. LICENSOR shall have the right to approve allcopy, layout and artwork of all advertisements placed by LICENSEE for the Licensed Products.LICENSEE shall forward copies to LICENSOR sufficiently in advance ofthe date of use forLICENSOR to review. In no event will any advertising or promotional piece for the Licensed Productsbe disseminated or utilized by LICENSEE without LICENSOR’ S advance written approval. Any earnedadvertising percentage not spent during the year shall be paid directly to Licensor.
 

 
     4.4 CLOSE-OUT SALES (Royalty): The reduced Trademark Royalty on Close-Outs shall be threepercent (3%). Licensee is only entitled to these reduced royalty rates on a maximum of twentypercent (20%) of Gross Sales per Year of the Licensed Term. On sales of Close-Outs in excess ofthis twenty percent (20%) limit, LICENSEE, shall pay the standard Trademark Royalty percentagesas set forth in Section 4.2 above.     Each quarter LICENSEE shall provide LICENSOR with an accounting of the sales of Close-Outson the Quarterly Report for said quarter. If any such accounting reveals that LICENSEE has paidthe reduced royalty on more than twenty percent (20%) of Gross Sales from the beginning of thatYear through the end of the relevant quarter, LICENSEE shall immediately pay to LICENSOR theamount of the calculated underpayment of Royalty. Should any such payment result (as of the endof any Year) in an overpayment of Royalty by LICENSEE, LICENSOR shall credit the overpayment toLICENSEE against the next Royalty payment due.     4.5 ADVANCE TRADEMARK ROYALTY: In addition to all other payments requiredhereunder, LICENSEE, shall pay to LICENSOR, an advance Trademark Royalty (hereinafter“Advance Trademark Royalty”). This Advance Trademark Royalty shall be creditedagainst the GMTR due for the year of the Initial Tenn. The balance of the GMTR shallbe paid in accordance with the provisions of paragraph 4.2(c) above.**5. REPORTING, ACCOUNTING AND AUDITING**     5.1 QUARTERLY REPORTS: No later than the twentieth (20th) day of the monthimmediately following each quarter of the Licensed Term, LICENSEE shall submit toLICENSOR a written report on a *form*provided by LICENSOR (see Exhibit A) fromtime to time which shall include a written statement of LICENSEE’S inventory and NetSales during such quarterly period showing the number and type of Net Sales of eachLicensed Product, a calculation of the Royalty due based thereon, and all otherinformation requested by LICENSOR in this Agreement or Exhibit A (hereinafter**“Quarterly Report”).**Each Quarterly Report shall be accompanied by the remittance toLICENSOR of the Royalties shown to be due on the report, shall be sent via overnightcourier, and shall be certified as correct by the Chief Executive Officer or ChiefFinancial Officer of LICENSEE or such other officers or employees of LICENSEE as shallbe designated by LICENSOR. In the event of an inquiry by LICENSOR regarding any suchreport, LICENSEE shall comply promptly with LICENSOR’S reasonable request forinformation in the manner requested. Within twenty (20) days after any expiration ortermination of this Agreement, LICENSEE shall provide LICENSOR a Quarterly Report forthe last whole or partial quarterly period during the Term, and LICENSEE shall continueto submit such reports and all Royalty payment obligations to LICENSOR within twenty(20) days following each thirty (30) day period during the Winding Up Period, if any.
 

 
     5.2 LATE PAYMENTS: It is specifically understood by LICENSEE that, with respect toroyalty payments and accounting statements, time is of the essence and any payment duepursuant to this Agreement (including, but not limited to all Royalties, trade showbills, and other bills for expenses or services agreed upon by LICENSEE, etc.), that islate shall bear interest from seven (7) days after the date that notice of paymentdefault is received from LICENSOR, unless the same is cured within the seven (7) dayperiod, until remittance thereof to LICENSOR at the prime rate of interest establishedby EAB — European American Bank of New York, New York, from time to time during saidperiod, plus two percent (2%) per annum or the highest rate allowed by law, which isgreater. The operation of this clause is without prejudice to any other right or remedyLICENSOR may have pursuant to the terms of this Agreement or the law. LICENSEE shall notset *off any*amounts against any payment of its Royalties or bills due LICENSORunless agreed in writing by LICENSOR prior thereto.     5.3 PAYMENT DEFAULT: The acceptance of late payments hereunder, or the acceptance ofpayment without a Quarterly Report or with an incomplete or incorrect Quarterly Report,or any restrictive endorsement (1) shall not constitute a waiver of timely payments, (2)shall not cure any default which might exist, and (3) shall be without prejudice to anyof the rights or remedies LICENSOR may have hereunder.     In the event that a default is declared and the rights of LICENSEE under thisAgreement are terminated, all payments required hereunder, including, but not limitedto, Trademark Royalty and Advertising Payments on past sales, and all GMIR for theLicensed Term, unpaid bills, etc., shall be immediately due and payable to LICENSOR, infull, plus any interest due thereon at the rate prescribed in 5.2 above.     5.4 PROPER BOOKS AND RECORDS: LICENSEE shall maintain separate and appropriatebooks of account or computer records relating to the Licensed Products, in accordancewith generally accepted accounting principles (including, without limitation, a salesjournal, sales return journal, cash receipt book, general ledger, and to the extentreasonably available, purchase *orders,*cutting tickets, and Inventory records) andshall make accurate entries concerning all transactions relevant to this Agreement. TheLicensed Products shall be assigned unique style numbers which shall be identical tothe style numbers utilized to identify each respective Licensed Product in allLicensee’s books and records and computer records, and on all sales invoices andrelated documents. LICENSEE’S books and records shall at all times during the LicensedTerm and for three years (3) thereafter (or in the event of a dispute between theparties hereto, until three (3) years after said dispute is resolved, whichever islater) be kept at LICENSEE’S Notice Address. LICENSEE shall not change the address atwhich the books and records are
 

 
kept without prior written notice to LICENSOR.     5.5 ANNUAL FINANCIAL STATEMENTS: No later than one hundred and twenty (120) daysafter each December 31st during the Term, LICENSEE shall furnish LICENSOR with itsaudited annual financial statements (if they are prepared in its ordinary course ofbusiness) prepared in accordance with generally accepted accounting principlesconsistently applied. In the event an audited statement is not prepared by LICENSEE,LICENSEE shall furnish LICENSOR within ninety (90) days after LICENSEE’S fiscal year endwith its unaudited financial statements, reviewed by an independent certified publicaccountant and certified to be correct by the Chief Executive Officer and Chief FinancialOfficer of LICENSEE or by such other officers or employees of LICENSEE as LICENSOR shalldesignate.     5.6 RIGHT TO AUDIT: Upon not less than ten (10) day’s notice to LICENSEE, LICENSOR,at its expense, shall have the right during the Licensed Term and for three (3) yearsthereafter at any time during regular business hours, not more frequently than one timeannually,. to have a qualified accountant selected by LICENSOR audit the records ofLICENSEE to the extent necessary to verify LICENSEE’S statements and payments ofRoyalties, including the right to examine, photocopy and make extracts from such records.Such records shall be made available to LICENSOR’S accountant at LICENSEE’S NoticeAddress stated above. LICENSEE shall cooperate with and assist LICENSOR’S accountant forthe purpose of facilitating such audit. The provisions of this paragraph shall survivethe termination or expiration of this Agreement.     If, as a result of such audit, LICENSOR’S *accountant*determines that the amount ofRoyalties due was greater than the amount reported by LICENSEE in any Quarterly Reportfurnished pursuant to Section 5. 1, LICENSOR shall promptly furnish to LICENSEE a copy ofthe report of its accountant setting forth the amount of the deficiency showing, inreasonable detail, the basis upon which such deficiency was determined. LICENSEE shallpromptly remit to LICENSOR a sum equal to such deficiency, together with interest thereonat the rate prescribed in Section 5.2 from the date such Royalty was due until the date of such remittance. In addition,if the audit reveals underpayment by more than three percent (3%) of theRoyalties in any quarterly period, LICENSEE shall pay to LICENSOR the cost of suchaudit.     If, as a result of such audit, LICENSOR’S accountant determines that the amountof Royalties paid was greater than the amount actually due, such overpayment will bepromptly refunded to LICENSEE.     5.7 PAYMENT CURRENCY: All calculations and payments required under this Agreementshall be in United States Dollars.
 

 
**6. QUALITY STANDARDS**     6.1 QUALITY STANDARDS: LICENSEE acknowledges that the continued maintenance ofthe great significance and value of the Marks and their associated goodwill, thecontinued maintenance of LICENSOR’S quality standards, and the merchandising andcoordination of the products associated with the Marks are all essential elements ofthe License granted herein. LICENSEE agrees that the nature and quality of all Uses ofthe Marks by LICENSEE shall conform to standards set by, and be under the control of,LICENSOR. All Uses, and any later permitted use as set forth in Section 1.7 above,shall require the prior written consent of LICENSOR. (See Approval Procedure Section6.2 below).     The Marks shall be used only in the form set forth in Schedule 1. Upon writtennotice, LICENSOR may change, at its sole discretion, such approved form of the Marks.LICENSEE shall comply with said change as soon as all remaining Inventory and anyInventory contracted for prior to such notice are Used in connection with theLicensed Products, but in no event shall they be Used beyond six (6) months from thedate of notice. This Agreement shall automatically apply to such later developedtrademarks which, at the sole option of LICENSOR, are specifically instructed for aUse by LICENSEE. The term “Mark” as used in this Agreement is intended to include allsuch later developed trademarks which LICENSEE has been instructed to Use under theterms of this Section. The “Showing” shoes shall be provided free of charge toLicensor four (4) times per year as follows: February(Fall) and August (Spring) notexceeding(80) pairs *for each*collection; June (Resort) and December(Prefall) not exceeding (30) pairs for *each*collection. Shoe sizes shall bebetween 7 1/2 to 11 to fit models.     6.2 APPROVAL PROCEDURE: Before offering for sale any product LICENSEE intendsto offer as a Licensed Product, and before committing to a Use of the Marks,LICENSEE shall obtain LICENSOR’S prior written approval of such product and/or Use.The Licensed Product and Marks Use approval process is critical to the Licensegranted herein, and must be strictly adhered to at all times by LICENSEE. OnceLICENSOR has approved any Licensed Product or Use, the approval shall remain ineffect unless LICENSOR notifies LICENSEE to the contrary in writing. LICENSOR shallnotify LICENSEE of its approval or disapproval within five (5) business days afterits receipt of a product.
 

 
     6.3 MAINTENANCE OF AND CONTINUED QUALITY CONTROL:     (A) LICENSEE agrees to cooperate with LICENSOR in facilitating LICENSOR’S control ofthe nature and quality of the Licensed Products, to permit reasonable, periodicinspection of LICENSEE’S operations, at reasonable times and with reasonable notice, andto supply LICENSOR with specimens of all Uses of the Marks as set forth in thisAgreement, and upon request of LICENSOR. LICENSEE shall provide LICENSOR, when and ifrequested for the purpose of quality control or for investigating an issue involving theMarks, with the name, address, telephone number and name of principals of any plants,factories or other manufacturing facilities of any third party (hereinafter **“Third PartyFacility”),**and any symbol or number a Third Party Facility may use or be required to useto identify itself as a source of goods. In the event the Licensed Products or componentsthereof are manufactured or displayed other than by LICENSEE, LICENSEE shall at all timesobtain compliance *with this*Article 6.     (B) In Order for LICENSOR to determine and assure itself that LICENSEE ismaintaining the quality control standards set forth by LICENSOR by manufacturing theLicensed Products in accordance with the samples approved by LICENSOR as per the approvalprocedure set forth in 6.2 above, within ten (10) business days after the commencement ofeach Licensed Product’s first production run, LICENSEE shall deliver to LICENSOR not lessthan one (1) pair of each first production run of Licensed Product without charge.LICENSEE shall also deliver to LICENSOR, promptly upon LICENSOR’S request from time totime, but not more than four (4) times per year, a reasonable amount of specific LicensedProducts without charge for quality control checking. If at any time, LICENSOR reasonablydetermines, in its sole discretion, that a Licensed Product is of lesser quality than thesample approved pursuant to Section 6.2 above, LICENSOR shall give LICENSEE writtennotice thereof, setting forth specifically the elements of variation in quality andreasons for disapproval. LICENSEE shall immediately cease production and distribution ofthat Licensed Product until its quality is improved to the sole reasonable satisfactionof LICENSOR; however, in no case shall LICENSEE have longer than thirty (30) days to curesaid defect. Repeated failures by LICENSEE, after notice, to correct a recurring LicensedProduct defect, shall constitute cause for immediate termination of *this*Agreement byLICENSOR with no right to cure by LICENSEE.     (C) In the event that the standard, style, appearance or quality of any LicensedProduct ceases to be acceptable to Licensor, Licensor shall have the right, exercisable inits reasonable discretion, to withdraw its approval of
 

 
such Licensed Products. Within thirty (30) days of receipt of written notice fromLicensor of its determination to withdraw such approval, Licensee shall either correct thedeficiencies in the Licensed Products to the satisfaction of Licensor or immediately ceasethe use of the Mark(s) in connection with the manufacture, distribution, sale, marketing,advertising, merchandising, publicity and promotion of such Licensed Products except thatwork in process may be completed and finished inventory may be sold to customers. Uponrequest, Licensee shall provide Licensor with a list of all work in progress and allcompleted inventories related to such Licensed Products. Licensor’s election to withdrawapproval from any or all Licensed Products shall not relieve Licensee from its obligationto pay royalties on any Sales of such Licensed Products theretofore or thereafter made, aspermitted herein.     6.4 SECONDARY GOODS: LICENSEE shall not market any of the Licensed Products asseconds or irregulars (“Secondary Goods”): (a) unless such Secondary Goods do notconstitute, during any four (4) consecutive Quarterly Periods, in excess of five percent(5%) of the total volume of Licensee’s production of the Licensed Products during suchQuarterly Periods; or (b) unless the Mark(s) are obliterated or rendered illegible to thereasonable satisfaction and approval of LICENSOR, which approval must be in writing; or(c) unless LICENSOR otherwise specifically authorizes LICENSEE to sell such SecondaryGoods with the Mark(s) thereon, strictly in compliance with LICENSOR’S instructions.Notwithstanding LICENSEE’S sale of such products, such sales shall be deemed Net Salesand entitle LICENSOR to the payment of the Percentage Royalty related thereto.     6.5 COMPLIANCE WITH LAWS: Any and all Uses and manufacture of the Licensed Productsshall be in compliance with all necessary governmental approvals and all applicable laws,rules and regulations, including, but not limited to, Title 29, section 212 of the UnitedStates Code and the Magnuson-Moss Warranty Act as to express and implied warranties.LICENSEE shall pretest all proposed and approved Licensed Products and shall causetruthful labeling regarding care, maintenance, and use to be affixed to the LicensedProducts, along with any other disclosures required by law or reasonably required byLICENSOR (including, but not limited to, copyright and trademark ownership notices whichshall be included with any Use of the Marks at all times, the legend “Manufactured by[name of LICENSEE] under license from Richard Tyler” on all Licensed Products [hangtags,labels or packaging as appropriate] to disclose the relationship established by thisAgreement, and any legally required Magnuson-Moss warranty notices clearly identifyingLICENSEE as responsible for the warranty). LICENSEE shall immediately inform LICENSOR inwriting of any material complaint by any consumer or governmental body relevant to theLicensed Products, and the status and resolution thereof. LICENSEE shall moveexpeditiously to resolve any such complaint.
 

 
     6.6 PRODUCTION/IMPORTATION:     (A) Licensed Products may only be manufactured by LICENSEE at a facility it does notown or lease if and only if it notifies LICENSOR that such third-party manufacturer shallbe retained, and further submits to LICENSOR such information, specifications and samplesas LICENSOR requests. LICENSOR reserves the right to reject, in the exercise of itsreasonable discretion, any such third-party manufacturer, and may impose reasonableinspection and supervision fees on approved manufacturers to cover LICENSOR’S costsincurred in making such determination. Such inspection and supervision fees shall be paidby LICENSEE.     (B) LICENSOR may demand that LICENSEE impose reasonable restrictions on suchthird-party manufacturers manufacture of products relating to the Mark(s)s and/or designsprovided by the LICENSOR, including, but not limited to, having such manufacturers andtheir key production managers execute confidentiality and anti-pirating agreements inconnection with same.     (C) Any Licensed Product caused to be manufactured by LICENSEE outside the UnitedStates shall be imported into the United States under the name of LICENSEE and onlyLICENSEE. Any and all Licensed Products imported under a name other than that of LICENSEEshall be deemed counterfeit by LICENSOR and LICENSEE, and may be so represented to U.S.Customs Service and prosecuted accordingly.     In order to prevent the importation of counterfeit merchandise, LICENSEE shall use a customsbroker for all Licensed Merchandise imported under this Agreement. LICENSEE shall promptly notifyLICENSOR of the identity of each such customs broker as LICENSEE shall use from time to time duringthe Term for Licensed Merchandise imported hereunder. LICENSOR shall not be liable for any acts ofor transactions with said broker.     LICENSEE agrees that it will not engage in “unlawful transshipment” of merchandise,as that term is defined by the U.S. Customs Service, or utilize manufacturers thatengage in such “unlawful transshipment.” LICENSEE further agrees that all merchandisemanufactured outside the United States will have labels permanently affixed thereto thatreflect the actual “country of origin” as that term is defined by the U.S. CustomService.     6.7 ALL APPROVALS SEASONAL: LICENSOR’S approval of any materials for use inconnection with the manufacture, distribution, sale, marketing, advertising,merchandising, publicity and promotion of any particular Season’s Licensed Productsshall constitute approval for such use in
 

 
connection with such Season unless LICENSOR notifies LICENSEE to the contrary inwriting.     6.8 LICENSEE acknowledges and agrees that although LICENSOR may conduct reviews ofvarious items for LICENSEE, including, without limitation, Licensed Products, prototypesor samples and may make various recommendations to LICENSEE, regardless of whether suchreviews or recommendations are required or voluntary under the terms of this Agreement,LICENSOR shall have no responsibility or liability for the operation of LICENSEE’Sbusiness or its manufacturing, distribution, sales or facilities used in connectiontherewith. Nor shall LICENSOR’S approval of any Prototype, Final Prototype, Packaging orartwork be construed to mean the LICENSOR has determined that the sample or artworkconforms to the laws or regulations of any jurisdiction, or that it is not in conflictwith any other licensed articles and Licensor shall not bear any liability for suchapproval.7. **THE MARKS**     7.1 OWNERSHIP RIGHTS DEFINED: LICENSEE acknowledges the ownership of the Marks byLICENSOR, agrees that it will do nothing inconsistent with such ownership, and that allUse (and any other use thereof) of the Marks by LICENSEE and all good will developedtherefore shall inure to the benefit of and be on behalf of LICENSOR. LICENSEE agreesthat nothing in this Agreement shall give LICENSEE any right, title, or interest in theMarks other than the right to Use the Marks in accordance with this Agreement andLICENSEE agrees that it will not attack the title of LICENSOR to the Marks, the validityof the Marks, any rights of LICENSOR that may have arisen from this Agreement, or thevalidity of this Agreement.     LICENSOR has the right to use any Licensed Product designed and used by LICENSEEand/or LICENSOR as part of LICENSEE’S obligation under this Agreement in any mannerLICENSOR may deem beneficial to the exploitation of the Marks anywhere in the world,including, but not limited to, the production, sale and distribution of the LicensedProducts through a third party contractor or a new licensee, should this License expireor terminate for any reason (with no right to a Winding-Up Period) prior to thefulfillment of any outstanding orders or as otherwise necessary to protect thereputation and goodwill of the Marks. LICENSEE shall be entitled to reimbursement foractual out-of-pocket expenses associated with the duplication of art work, designs,patterns, etc. developed by LICENSEE (which shall be duplicated and forwarded toLICENSOR promptly after requested by LICENSOR) for use as set forth in this paragraph.
 

 
     7.2 COPYRIGHT NOTICES: LICENSOR shall be deemed the author, with the right but not theobligation in its sole discretion, to register a claim to any copyright within an art work or awriting that is developed by LICENSEE as part of the obligations of LICENSEE toward the LicensedProducts. LICENSEE agrees that all such copyrighted artwork and writings are a work for hire, andshall be protected as the sole and exclusive property of LICENSOR. In the event any such artworkand writings are deemed to not be works for hire, LICENSEE hereby assigns all copyright rights inand to the artwork and writings to LICENSOR. LICENSEE agrees to execute such documents as may berequested by LICENSOR to give effect to this provision. LICENSEE shall place a legally sufficientcopyright notice which protects the rights of LICENSOR on each and every design, style, garment,creation or writing which is capable of protection pursuant to the copyright laws of the UnitedStates of America. Any public distribution of goods bearing copyrightable works of LICENSOR byLICENSEE without a copyright notice as required above, if not authorized, is a violation of thisAgreement.     7.3 CONFIRMATION OF OWNERSHIP: Whenever requested by LICENSOR, whether during the LicensedTerm or thereafter, LICENSEE shall execute such documents or applications as LICENSOR may deemnecessary to confirm LICENSOR’S ownership of all their rights, to maintain the validity of theMarks and the copyright(s) referred to above in Section 7.2, and to obtain, or maintain anyregistration thereof.     7.4 LABELS/PACKAGING: All Licensed Products shall contain a label, hangtag and/or packaging(hereinafter c collectively “labeling” or “label(s)”) as designated by LICENSOR from time to time.LICENSEE understands the importance of maintaining the security and integrity of all trademarkedlabeling used on the Licensed Products, and LICENSEE agrees to use its best efforts to maintain,and to require any subcontractors to maintain, a strict, accurate and current inventory of alllabels throughout the manufacturing process of the Licensed Products so as to preclude anydiversion of the labels, and, if any such diversion occurs, LICENSEE agrees to notify LICENSOR inwriting immediately upon discovery thereof.     7.5 TRADEMARK REGISTRATION: In the event the Territory includes countries in which one ormore of the Marks has not yet been registered, LICENSOR has the right, but not the obligation, toobtain trademark registration of any of the Marks in such countries. LICENSOR makes norepresentation or warranty that the Marks will be registered or are registerable in the Territory,and the failure to obtain or maintain registrations thereof shall not be deemed a breach hereof byLICENSOR.**8. MARKETING AND DISTRIBUTION**     8.1 PARTICIPATION PLEDGED: LICENSEE acknowledges that the marketing programs that may bedeveloped by or for LICENSOR are for the benefit of all licensees of the Marks, and LICENSEE’Scooperation and support thereof are an integral part of such program and this Agreement. Therefore,LICENSEE pledges its direct and active support of all licensee meetings and any marketing programLICENSOR may
 

 
develop, including, without limitation, participation in sales presentations and fashionshows, presentations and distributions to the various media, special events and special promotionsby the timely giving of Licensed Products, direct assistance, sales and other relevant information.     8.2 MARKETING, WHOLESALE & SHIPMENT POLICY: LICENSEE acknowledges that theavailability and selection of product, styles, fabrication, quality, colors and sizes ofthe Licensed Products (as the case may be depending on the category of Licensed Product)are an integral part of the high reputation and value which the trade and consumers havecome to associate with the Marks. To further protect that reputation and value, LICENSEEagrees that its policy of sale, distribution, and exploitation shall be of the highstandard established by LICENSOR from time to time in its sole discretion reasonablyapplied (see the Licensee Guidelines), and any variance from such standards shall be onlyupon the prior written approval of LICENSOR or when necessary to comply with anyapplicable law, rule or regulation with prior written notice thereof to LICENSOR. LICENSEEhereby acknowledges that the timely shipment of all Licensed Products approved forshipment to a customer is a critical element of this License, and LICENSEE agrees that itwill use high diligence to timely ship all such orders.     LICENSEE shall not sell the Licensed Products to any person or entity LICENSEEknows, should have known, or had reason to believe would sell them outside the Territory.     8.3 DISTRIBUTION: LICENSEE’S distribution shall be solely to retail outlets to whichLICENSOR and other of LICENSOR’S licensees sell products bearing the Mark(s) and to suchspecialty shops, department stores and other retail outlets dealing in products similar inquality to the Licensed Products and where operations are consistent with the standards ofquality, taste and prestige associated with the Mark(s). The Licensed Merchandise shall besold by LICENSEE only at wholesale and at wholesale prices. LICENSEE shall not (i) subjectto Section 4.4, sell or distribute any Licensed Merchandise to discounters, wholesalers,jobbers, diverters, or any other entity which does not sell at retail exclusively, or (ii)sell the Licensed Merchandise directly to the public in retail stores, catalogs orotherwise unless LICENSEE submits a proposal to LICENSOR outlining its plans for thedevelopment of such a business and LICENSOR approves, in the exercise of its solediscretion, such proposal. Within thirty (30) days after the execution of this Agreement,LICENSEE shall provide LICENSOR with a list of its customers for the Licensed Merchandise.LICENSEE shall submit all changes in its customer list with the regular statement ofroyalties or more frequently if needed. LICENSOR shall have the right to disapprove all orany portion of such list. LICENSEE shall not sell Licensed Merchandise to any customerwithout first obtaining currently effective approval from LICENSOR.
 

 
     8.4 SAMPLES FOR SALES FORCE: Prior to the showing of a new line, and subsequent toUse approvals (see Section 6.2), LICENSEE shall furnish to its Licensed Product salesforce sufficient samples of the Licensed Products for their use in selling said productand for the display of said Licensed Products at trade shows and showrooms. At the sametime and at no cost, LICENSEE shall give LICENSOR three complete lines of the LicensedProducts for display at its showroom along with all other products bearing the Marks andas otherwise determined by LICENSOR, and shall provide a reasonable quantity of Licensed Product for the use of any publicrelations or advertising firm or individual hired to promote said Licensed Products and/or theMarks through editorials, advertising and the like, also at no cost to LICENSOR.     8.5 MERCHANDISER/DESIGNER: LICENSEE shall provide, at its own expense, a full time or parttime (as is necessary) employee or independent contractor qualified to act as a designer,merchandiser and/or production/sample coordinator (or the equivalent as the case may be dependingon the Licensed Product category) with respect to the Licensed Products. This employee shalldevote the necessary amount of his/her working time on the development and coordination of theline in conjunction with the merchandising staff of LICENSOR.     8.6 APPEARANCE OF ONE PRODUCT LINE: LICENSEE acknowledges that to the extent reasonablypossible and prudent LICENSOR and its merchandiser/designers/production coordinators will attemptto make the product lines of all licensees of the Marks coherent and consistent and appear to bethe product of one company. LICENSEE agrees to reasonably cooperate with LICENSOR in thisendeavor.**9. INFRINGEMENT**     LICENSEE shall notify LICENSOR promptly of any actual or threatened infringements, imitations,or unauthorized use of the Marks by third parties of which LICENSEE becomes aware. LICENSOR shallhave the sole right, at its expense, to bring any action on account of any such infringements,imitations or unauthorized use, and LICENSEE shall cooperate with LICENSOR, at LICENSOR’S expense,as LICENSOR may reasonably request, in connection with any such action brought by LICENSOR.LICENSOR shall retain any and all damages, settlement and/or compensation paid in connection withany such action brought by LICENSOR. In no event shall LICENSOR be responsible to LICENSEE for anydamages that may result from said infringement(s), subject to Section 10. 1 hereof(Indemnification). Notwithstanding anything to the contrary contained herein, in the event LICENSORfails or refuses to commence an action on account of any infringements, imitations or unauthorizeduse of the Marks, LICENSEE shall have the right to do so after advance written notice of its intentto LICENSOR. In such event, LICENSEE shall pay all costs and expenses incurred by it in connectionwith such action, and shall retain any and all damages, settlement and/or compensation paid inconnection with any such action brought by LICENSEE.
 

 
Notwithstanding the preceding, in no event will LICENSEE enter into any settlement without theexpress prior written approval of LICENSOR, which approval it may grant or withhold in its solediscretion. No costs or expenses incurred by LICENSEE in any such action shall be deducted from oroffset against the Royalties otherwise do LICENSOR. In the event LICENSEE requests that LICENSORcooperate in any such action, LICENSOR will do so at the sole cost and expense, including counselof LICENSOR’S own choosing, of LICENSEE. In no event shall LICENSOR be responsible to LICENSEE forany damages that may result from said infringement(s),**10. INSURANCE AND INDEMNIFICATION**     10.1 INDEMNIFICATION:     (A) LICENSEE hereby indemnifies and holds LICENSOR, its successors and assigns, and anyentity owning or controlling LICENSOR and its owners, officers, directors, employees, agents andrepresentatives (hereinafter individually or collectively referred to as “Licensor Corporate”)harmless from and against any and all liabilities, claims, causes of action, suits, damages,including without limitation, suits for personal injury or death of third parties, and expenses,including reasonable attorneys’ fees and expenses, for which LICENSOR or Licensor Corporate maybecome liable or may incur or be compelled to pay as a result of (i) LICENSEE’S performance of (orits failure to perform) its obligations or responsibilities hereunder, or (ii) LICENSEE’S breachof any of its covenants, representations and warranties under this Agreement, or (iii) any claimbased upon allegations of negligence or strict liability which are attributable to any act ofLICENSEE, or (iv) claims of infringement of any intellectual property right that would not beincluded under Section 10. 1 (B) below. In the event there is a claim against LICENSOR for whichindemnification from LICENSEE is sought hereunder, LICENSEE shall have the right to defend, settleor contest said claim, at LICENSEE’S sole discretion, so long as the exercise of such discretiondoes not adversely affect LICENSOR in a substantial manner and does not affect the Marks in anyway. This paragraph shall survive expiration or termination of the Licensed Term.     (B) LICENSOR hereby indemnifies and holds LICENSEE, its successors and assigns, and anyentity owning or controlling LICENSEE and its officers, directors, employees, agents andrepresentatives (hereinafter individually or collectively referred to as “Licensee Corporate”)harmless from and against liabilities, claims, causes of action, suits, damages, includingwithout limitation, suits for bodily injury or death of third parties, and expenses, includingreasonable attorneys’ fees and expenses, for which LICENSEE or Licensee Corporate may becomeliable or may incur or be compelled to pay as a result of an infringement of any third party’sregistered trademark in the Territory resulting from LICENSEE’S Use of the Marks in compliancewith all the terms and conditions of this Agreement (including, but not limited to, the ApprovalProcess set forth in 6.2). In the event there is a claim against LICENSEE for whichindemnification from LICENSOR is sought hereunder, LICENSOR shall have the sole
 

 
right to elect to defend, settle or contest said claim, at LICENSOR’S sole discretion,except as otherwise provided herein. This paragraph shall survive expiration or termination ofthe Licensed Term.     10.2 EFFECT OF APPROVAL: The approval by LICENSOR of any Licensed Product, Use ordistribution channel shall not be construed as a consent by LICENSOR to any infringement orviolation of the law or rights of third parties occasioned by the approved License Product, Useor distribution channel, nor as an indemnification by LICENSOR or assumption of anyresponsibility for any such claim beyond the indemnification set forth in Section 10. 1 (B)above.     10.3 INSURANCE: LICENSEE shall promptly procure and maintain in full force and effect at alltimes during the Licensed Term, with a responsible insurance carrier or carriers reasonablyacceptable to LICENSOR, at least Two Million Dollars ($2,000,000) coverage through a commercialgeneral liability policy, including products liability, and a Two Million Dollar ($2,000,000)umbrella general liability policy that specifically includes any and all risks related to the saleor Use of the Licensed Products, and that identifies the LICENSOR, owners, their officers,directors, employees, subcontractors, agents and managers.     LICENSEE shall automatically furnish or cause to be furnished to LICENSOR within thirty(30) days of the Effective Date (and on the anniversary date thereof for every Year thereafter)evidence, in form and substance reasonably satisfactory to LICENSOR, of the maintenance andrenewal of the insurance required herein, including, but not limited to, copies of policieswith applicable riders and endorsements, Certificates of Insurance, and Continuing Certificatesof Insurance.**11. TERMINATION**     TERMINATION: Subject to the continuing obligations arising from a breach hereof and thoseterms and obligations that survive cessation of this Agreement by the clear import of theirlanguage (including, but not limited to, Articles 4 [Payment], 5 [Accounting], 7 [Marks] and 10[Insurance & Indemnification)), this Agreement and all rights relevant thereto shall cease uponthe earlier of termination, for whatever reason, or expiration, except that the exercise of anyright of termination under this Article II shall not affect any rights which have accrued prior totermination and shall be without prejudice to any other legal or equitable remedies to whichLICENSOR may be entitled by reason of such rights.     (A) WITHOUT CURE: LICENSOR shall have the right to terminate this Agreement effectiveimmediately (without right to cure by LICENSEE) (1) upon LICENSEE’S receipt of written notice fromLICENSOR in the event of any affirmative act of insolvency by LICENSEE; or (2) upon theappointment of any receiver or trustee to take possession of the properties of LICENSEE; or (3)upon the winding-up, sale, consolidation, merger, or any sequestration by governmental authorityof LICENSEE; or (4) upon the breach by LICENSEE of any Material Term herein, except as expresslyset
 

 
forth in paragraph II (B) hereof, or (5) upon the decision of a court of first impressionhaving competent jurisdiction to permanently enjoin LICENSEE’S unlawful use of the Marks or use ofthe Marks in a manner specifically denied in this Agreement, or adjudges such use to be violativeof the trademark or other rights of any third party; or (6) upon performance by LICENSEE of anyact specifically set forth in this Agreement as a non-curable breach.     If this License is terminated as set forth above with no right to cure by LICENSEE, thenLICENSEE shall have no right to a Winding-Up Period (as defined here and below) and shallpromptly transfer all remaining Inventory to LICENSOR at LICENSEE’S direct and actual cost ofgoods to LICENSOR.     (B) WITH CURE: LICENSOR shall have the right to terminate this Agreement, after notice toLICENSEE and expiration of a ten (10) day cure period for payment and or reporting defaults andexpiration of a thirty (30) day cure period for all other defaults (but excluding any non-curabledefault as set forth in Section II (A) above which shall not be subject to this Section I 1 (13))if said defaults are capable of being cured, (1) upon the breach of any of the terms or conditionsof this Agreement by LICENSEE, or (2) if LICENSEE takes any act or fails to act, and such action oromission is, in the reasonable opinion of LICENSOR, materially harmful to the Marks or the businessof LICENSOR, or LICENSOR’S other licensees, or the brand. If a breach is not capable of beingcured, then termination shall become effective as of the date of notice.**12. EFFECTS OF AND PROCEDURE ON TERMINATION**     12.1 DISCONTINUE USE OF THE MARKS: Upon the expiration or termination of this Agreement andany Winding-Up Period (as defined below), LICENSEE agrees (1) immediately to discontinue all Useof the Marks and copyrights of LICENSOR and any term, trademark or trade dress confusingly similarthereto; and (2) at no cost to LICENSOR, to transfer promptly to LICENSOR or destroy all printedmaterials bearing any of the Marks or copyrights of LICENSOR, and all tapes, heat stamps, dyes andthe like used by LICENSEE (and any third party subcontractor) for reproduction of the Marks orcopyrights of LICENSOR. In the event LICENSEE destroys such items, it shall provide a swornstatement to that effect detailing what was destroyed, the manner of destruction, and the date ofdestruction which is signed by an officer of LICENSEE. LICENSEE further agrees as set forth inArticle 7 hereof that in the event of expiration or termination of this Agreement, that all rightsin and to the Marks, the copyrights of LICENSOR and the good will connected therewith shall remainthe property of LICENSOR. LICENSEE acknowledges that any Use or use of the Marks or copyrights ofLICENSOR by LICENSEE after the date that termination or expiration is effective, which shall beeffective upon the date set forth in any notice of Termination or upon the expiration of anyWinding Up Period, whichever is later, shall constitute an infringement of the Marks and/orcopyrights of LICENSOR.     12.2 WINDING-UP PERIOD: Upon the expiration or termination of this
 

 
Agreement and subject to LICENSOR’S right to purchase the Inventory as set forth in Section12.3 below, LICENSEE shall have a reasonable time (as determined by LICENSOR upon receipt andreview of the Inventory Statement and verification of the Inventory size), not to exceed nine (9)months from the Commencement Date (defined below) of the Winding-Up Period, on a non-exclusivebasis, in which to dispose of its Inventory, if any, according to all the terms and conditions ofthis Agreement (hereinafter **“Winding-Up Period”).**LICENSEE shall have no right to dispose of orotherwise deal in any Licensed Products or use tangible items bearing the Marks if it refuses toallow LICENSOR to exercise its rights under this Section *12.2 or*if it fails to allowLICENSOR to resolve any objections to the Inventory Statement to the satisfaction of LICENSOR.     (A) WINDING-UP PROCEDURE: No later than sixty (60) days prior to expiration of this Agreementor within fifteen (15) days after termination, as the case may be, LICENSEE shall deliver toLICENSOR a complete and detailed statement setting forth the number and description of the thenremaining Inventory, advertising (only if said advertising has previously been purchased and setfor publication), copies of orders LICENSEE intends to fill, and the like (hereinafter **“InventoryStatement” ).**LICENSEE shall permit LICENSOR to be present at the time (with at least ten (10)day’s notice of the time and date of the compilation of data in preparation for the InventoryStatement) and at all reasonable times thereafter during the Winding-Up Period to have sufficientaccess to verify the accuracy of the Inventory Statement. If LICENSOR does not make a writtenobjection to any part of the Inventory Statement within fourteen (14) days of receipt thereof, saidstatement shall be deemed accurate. The Winding-Up Period shall commence upon the earlier of theexpiration of said fourteen (14) day period or the date of written notice to proceed withwinding-up from LICENSOR (hereinafter **“Commencement Date”).**     (B) EXPIRATION OF THE WINDING-UP PERIOD: Within twenty (20) business days following (i)expiration of the Winding-Up Period, or (ii) the actual liquidation of all remaining LicensedProducts, or (iii) upon expiration of the fifteen (15) day or sixty (60) day deadline (depending onwhether termination or expiration has occurred) for submission of the Inventory Statement byLICENSEE if none is received by LICENSOR within said time period, or (iv) the termination orexpiration of this Agreement without right to a Winding-Up period, or (v) the exercise ofLICENSOR’S right to purchase the Inventory as set forth in Section 12.3 below (unless LICENSOR doesnot purchase all remaining Inventory in which case LICENSEE shall have a right to a Winding-UpPeriod to sell-off the Inventory not so purchased), whichever is earlier, LICENSEE shall remit thelast requisite Royalty payments and reports on the sale thereof (as required in Section 5.1)[Payment], and shall, at the same time, remove and send to LICENSOR, at no *cost*toLICENSOR, any and all *then remaining Inventory,*and shall cease to Use the Marks or otherwise actin any way which may lead another to believe the LICENSEE still has the right to Use the Marks.     12.3 LICENSOR’S RIGHT TO PURCHASE INVENTORY: Upon expiration or termination of thisAgreement for any reason, LICENSOR shall have the
 

 
right and option superior to any right of LICENSEE to a Winding-Up Period to be exercised inwriting and mailed or delivered to LICENSEE no later than fourteen (14) days after receipt of theInventory Statement, to purchase any or all remaining Inventory at LICENSEE’S actual and directcost of the goods. No general overhead or indirect costs shall be included in computingLICENSEE’S actual cost of the goods.**13. RELATIONSHIP OF THE PARTIES**     The relationship of LICENSEE to LICENSOR is that of an independent contractor and neitherLICENSEE nor its agents or employees shall be considered employees or agents of LICENSOR. ThisAgreement does not constitute and shall not be construed as consisting of a partnership orjoint venture or grant of a franchise between LICENSOR and LICENSEE. LICENSEE shall not havethe right, nor shall it represent that it has the right, to bind LICENSOR to any obligations tothird parties.**14. ASSIGNMENT**     14.1 ASSIGNMENT: This Agreement may be assigned by LICENSOR but shall not be assignable ortransferable by LICENSEE without the prior written consent of LICENSOR reasonably applied, andany attempted assignment, sublicense or pledge thereof by LICENSEE without such prior writtenconsent shall be void and shall constitute a non-curable breach of the obligations of LICENSEEhereunder and shall be subject to termination by the LICENSOR at LICENSOR‘S solediscretion.     14.2 DEFINITION OF ASSIGNMENT: Assignment for purposes of this Agreement shall be the sale,transfer or assignment of fifty percent (50%) or more of the shares of LICENSEE, including by wayof transfer, or assignment of any amount of authorized but unissued shares, a merger orconsolidation; (or, if a partnership, then any change in at least fifty percent (50%) or more ofthe partners’ interest) in which LICENSEE is not the surviving entity; or, a sale of a substantialpart of LICENSEE’S assets.**15. NOTICES**     15.1 NOTICES: Any notice, demand, waiver, consent, approval or disapproval (collectivelyreferred to as “notice”) required or permitted herein shall be in writing and shall be givenpersonally, by messenger, by air courier, or by prepaid registered or certified mail, withreturn receipt requested, addressed to the parties at their respective Notice Address.     15.2 A notice shall be deemed received on the date of receipt.
 

 
**16. ARBITRATION AND APPLICABLE LAW**     16.1 ARBITRATION & APPLICABLE LAW: Any controversy or claim arising under or in relation tothis Agreement, or the breach thereof, or the relations between LICENSEE and LICENSOR or LICENSEEand OWNER (excluding disputes falling within paragraph 3.4(B), supra , or 16.2 below) shall besettled by arbitration by a panel of three arbitrators (unless the amount in dispute is less thanTwenty-Five Thousand Dollars ($25,000) in which case there shall be only one arbitrator) in theCity of Los Angeles, California, administered by the American Arbitration Association under thethen applicable General Arbitration Rules of the Council of the Textiles and Apparel Industries (orif said Rules no longer exist, then the equivalent applicable arbitration rules generally acceptedby the apparel industry), and judgment on the award rendered by the arbitrator(s) may be entered inany court having jurisdiction thereof, provided however, that the arbitrator(s) shall be bound bythe laws of the State of California and, regarding any questions related thereto, the trademarkstatutes of the United States of America, and shall have no power to extend this Agreement beyondits termination date, nor to award punitive, consequential, multiple, incidental or any otherdamages in excess of the economic damages actually sustained by the claimant. If, and only if, thearbitrator(s) shall detennine that either party’s position in arbitration was not maintained ingood faith, then the arbitrators shall have the power to order reinstatement or other continuationof the parties’ relationship after termination, and to award the other party a reasonableattorney’s fee.     The choice of law governing any and all questions and issues in any way related to thisAgreement, except as set forth in the above paragraph) shall be the laws of the State of NewYork and the trademark statutes of the United States of America.     16.2 EQUITABLE RELIEF: LICENSEE recognizes that the Marks possess a special, unique andextraordinary character which makes difficult the assessment of monetary damages which LICENSORmight sustain by an unauthorized use. LICENSEE agrees that irreparable injury would be caused byLICENSEE by such unauthorized use, and that injunctive relief, including specific performance asapplicable, would be appropriate in the event of breach of this Agreement. The loser of saidaction shall pay any and all reasonable costs, expenses, attorney’s fees and disbursementsincurred by the other party with respect thereto.     This Section 16.2 shall be an exception to the mandatory arbitration provision set forthin Section 16.1 above.**17. CONFIDENTIALITY OF INFORMATION**     17.1 CONFIDENTIAL INFORMATION: LICENSEE and LICENSOR shall regard and preserve asconfidential all Confidential Information (defined below) related to the business of the otherparty, except that information which is public knowledge, which may be obtained by it from anysource as a result of this Agreement, or otherwise. The parties agree that they shall not andthey shall cause their employees, representatives, agents and licensees not to divulge, furnishor make accessible to anyone such Confidential Information, except as may be necessary fromtime to time in performance of their duties hereunder on a limited “need to know” basis. This
 

 
provision shall survive the termination of this Agreement.     LICENSEE shall confine and limit the use of all Confidential Information obtained fromLICENSOR, its designees, its licensees or its agents exclusively to the development and sale of theLicensed Products, and shall not use or adopt such Confidential Information obtained from LICENSOR,including, but not limited to customer lists, pricing methods, marketing programs, in connectionwith any product which is not a Licensed Product. Upon expiration or termination of the Agreementfor any reason, LICENSEE shall forthwith deliver to LICENSOR any such Confidential Information andthereafter cease using the same.     LICENSOR shall confine and limit the use of all Confidential Information obtained fromLICENSEE, its designees, or agents exclusively to the development, marketing and sale of the Marks.     17.2 DEFINITION: “Confidential Information” shall be written information marked confidentialand oral information designated confidential and confirmed as such in writing delivered not laterthan ten (10) days after such disclosure, and shall include this Agreement, customer/accountlists, and marketing plans of LICENSOR or LICENSEE whether or not marked as confidential orconfirmed as such in writing.**18. MISCELLANEOUS**     18.1 LIMITATION ON USE OF OTHER TRADEMARKS: LICENSEE does hereby acknowledge that any attemptby it, or by any other corporation, partnership, or business organization in which any officers,directors, stockholders, partners of LICENSEE are owners thereof, to manufacture, sell ordistribute the Licensed Products under any trademark, trade name, or other identifying word orsymbol of any Competitor other than the Marks, excluding those used by LICENSEE as of the date ofthis Agreement as set forth on Schedule 2 attached hereto, constitutes a violation of itsobligation to use its best efforts to exploit the License granted herein and is a breach of thisAgreement. LICENSEE does hereby assume the liability for its officers, directors, and shareholders(or partners) for such conduct and agrees that any such conduct shall constitute a breach of thisAgreement. For purposes of clarification, LICENSEE may license, manufacture and sell products whichare similar to the Licensed Products in category, image, quality and price points, and which aresold through distribution channels of the same like and kind as the Licensed Products under themark of any third party, so long as it does not use the same designs or styles as are used for theLicensed Products hereunder in connection with any third party mark.     18.2 HEADINGS: The headings contained in this Agreement are for convenience and referencepurposes only. They do not form a part hereof and shall not affect the meaning or interpretation ofthis Agreement.
 

 
     18.3 LICENSOR’S RIGHT TO APPOINT REPRESENTATIVES: LICENSOR shall have the right at any time toappoint in writing an authorized representative or representatives who shall be empowered to act onbehalf of the LICENSOR with regard to any matter pertaining to this Agreement. It is understoodthat such appointment shall be strictly limited to the provisions of the written appointment, thatthe representative shall have no authority beyond the scope of such appointment, and that LICENSEEshall act only in accordance with such written appointment.     18.4 WAIVER OF RIGHTS: The failure of a party to insist upon strict adherence to anyprovision of this Agreement on any occasion shall not be considered or deemed to be a waiver norconsidered or deemed to deprive that party of the right thereafter to insist upon strict adherenceto that provision or any other provision of this Agreement. Any waiver must be in writing.     18.5 COMPLETE AGREEMENT & NO ORAL MODIFICATION: This Agreement is a complete statement of allagreements among the parties with respect to the subject matter hereof. Any *amendment,*modification, alteration, change or waiver must be in writing. LICENSEE acknowledges that LICENSORhas made no warranties or representations except those expressly stated herein, if any.     18.6 SEVERABILITY: If any provisions of this Agreement is for any reason declared to beinvalid or unenforceable, the validity of the remaining provisions shall not be affectedthereby.     18.7 INCORPORATION BY REFERENCE: The recitals, Schedules and Exhibits are hereby incorporatedin this Agreement. Paragraph headings are used solely for convenience and should not be given anyweight in the interpretation of this Agreement.     18.8 WARRANTIES OF CORPORA IE FITNESS: The parties each warrant the following: (1) that thedelivery of this Agreement has been duly authorized by all requisite corporate action of itscompany; (2) that the execution and delivery of this Agreement does not violate its Articles ofIncorporation or By-laws, or any contract or commitment to which it is a party or by which it isbound; and (3) that it is not a party to any suit, action, administrative proceeding, orinvestigation which, if successful, would have a material, adverse effect on its properties,financial conditions or business.     18.9 CONSTRUCTION: This Agreement’s terms and conditions were freely negotiated. LICENSORdrafted the Agreement for the convenience of the parties only. As such, the language shall beinterpreted without regard to any rule, law or presumption requiring the language to be construed,interpreted or applied against LICENSOR.     18.10 RESERVATION OF RIGHTS: LICENSOR reserves all rights not specifically grantedto LICENSEE hereunder.
 

 
     18.11 USE OF COUNSEL: The parties hereto represent that they have each consulted with counselof their own choosing in connection with the negotiation and execution of this agreement or haveknowingly chosen not to do so.     IN WITNESS WHEREOF, the parties have first caused this Agreement to beexecuted as of the Effective Date.     TYLER TRAFFICANTE       By:              Name:              Title:              THE FASHION HOUSE, INC.       By:              Name:              Title: