Blueprint





  Exhibit 4.5









 



Franchising


 



Agreement


 


 


 



Between


 


 


 



Dufry International AG



(Switzerland)


 


 



and


 


 



Hudson Group (HG) Inc



(USA)


 




 









Franchising
agreement 











 



INDEX


 


	


I. PARTIES  

	


1


	


II. RECITALS  

	


2


	


III. DEFINITIONS AND INTERPRETATION  

	


4


	


A.  DEFINITIONS  

	


4


	


B.  INTERPRETATION GUIDELINES  

	


5


	


IV. COVENANTS  

	


6


	


Article 1

	


Object

	


6


	


Article 2

	


Territory

	


6


	


Article 3

	


Franchise

	


6


	


Article 4

	


Effective Date - Validity

	


7


	


Article 5

	


Sub-Franchise

	


7


	


Article 6

	


Remuneration

	


7


	


Article 7

	


Payments

	


7


	


Article 8

	


Franchisee’s Rights And Obligations

	


8


	

8.1

	


Exercise of Franchise

	


8


	

8.2

	


Use of Intellectual Property

	


8


	

8.3

	


Exclusivity

	


9


	


Article 9

	


The Franchisor’s Rights And Obligations

	


9


	

9.1

	


Provision of Materials

	


9


	

9.2

	


Coaching

	


9


	

9.3

	


Exclusivity

	


9


	

9.4

	


Trademark Maintenance

	


9


	


Article 10

	


Ownership Of Intellectual Property

	


9


	


Article 11

	


Registration Of The Franchisee As Registered User

	


10


	


Article 12

	


Other Marketing Intangibles

	


10


	


Article 13

	


Quality Control, Inspection & Reporting

	


10


	

13.1

	


Quality Control

	


10


	

13.2

	


Inspection

	


10


	

13.3

	


Reporting

	


11


	


Article 14 

	


Infringement By Unauthorised Persons

	


11


	


Article 15

	


Infringement of Third Parties’ Rights

	


11


	


Article 16

	


Confidentiality

	


11


	


Article 17

	


Transferability

	


11


	


Article 18

	


No Represenations or Warranties

	


12


	


Article 19

	


Termination

	


12


	

19.1

	


Ordinary Termination

	


12


	

19.2

	


Extraordinary Termination

	


12


	


Article 20

	


Effects of Termination

	


13


	


Article 21

	


No Goodwill Redundancy On Termination

	


13


	


Article 22

	


Entire Agreement

	


14


	


Article 23

	


Other Contractual Relationships Between The Parties

	


14


	


Article 24

	


Severability

	


14


	


Article 25

	


Successors And Assignees

	


14


	


Article 26

	


Independent Parties

	


15


	


Article 27

	


Costs And Taxes

	


15


	

27.1

	


Costs

	


15


	

27.2

	


Taxes

	


15


	


Article 28

	


Force Majeure

	


16


	


Article 29

	


Non-Waiver And Cumulative Rights

	


16


	


Article 30

	


Notices

	


16


	


Article 31

	


Applicable Law

	


17


	


Article 32

	


Dispute Resolution and Arbitration

	


17


	


Article 33

	


Further Assurances

	


17


	


EXHIBIT 1: COMPONENTS OF THE FRANCHISE 

	


19


	


EXHIBIT 2: FRANCHISE FEE 

	


21







 




 









Franchising agreement





 



I.
PARTIES


 



On one side,


 


Dufry
International AG, a Swiss stock corporation duly incorporated and
existing under the laws of Switzerland with registered offices at
Brunngässlein 12, 4010 Basel, Switzerland.


 



(hereinafter referred to as the "Franchisor")


 



and on the other side


 


Hudson
Group (HG) Inc , a limited company incorporated and existing under
the laws of the United States of America with registered offices
One Meadowlands Plaza, 11th Floor, East Rutherford, New Jersey,
07073, USA.


 



(hereinafter referred to as the "Franchisee”)


 


 


 




 

Page 1








 



II. RECITALS


 




I.

WHEREAS, both Parties belong to a
multinational group of companies operative in a number of markets
(hereinafter referred to as “the Dufry
Group”).






 




II.

WHEREAS, the Dufry Group is one of the
world’s leading operators of shops that sell luxury consumer
products and is engaged in the retail business with “duty
free” and “duty paid” concessions located at
airports, borders, on cruise liners, seaports, ferries, railway
stations and city centre locations.






 




III.

WHEREAS, the Franchisor has existing
goodwill, know-how and retail specific intellectual property
including a brand portfolio and a “business concept” in
the area of duty-free and duty-paid retailing, and has achieved a
valuable goodwill amongst stakeholders in the business of the Dufry
group (i.e. airport operators, luxury branded goods suppliers,
retail industry employees, banks and financial institutions
etc.).






 




IV.

WHEREAS, the Franchisor provides
corporate and supporting services as listed in Exhibit 1 and grants
the Franchisee access to global functions (hereinafter referred to
as the “Centralised Support Services”).






 




V.

WHEREAS, the Franchisor has the right to
use and licence its trademarks - Dufry, Nuance and WDFG -
(hereinafter referred to as the “Trademarks”),
registered in several jurisdictions including the Territory, as
well as ancillary brand-building and business related intangibles
as further described in Article 3 of this Agreement.






 




VI.

WHEREAS, the Franchisee and Franchisor
acknowledge the existence of a separate trademark license agreement
in relation to the right of Franchisee to use the Hudson brand as
set forth in such trademark license agreement.






 




VII.

WHEREAS, the Franchisee and its
subsidiaries and/or controlled affiliates operate currently certain
duty-free and/or duty paid shops in the Territory (hereinafter
referred to as “the Shops”).






 




VIII.

WHEREAS, the Franchisee, on behalf of
its subsidiaries and/or controlled affiliates, wishes to benefit
from the widespread recognition of Dufry Group’s trademarks,
business concept and goodwill, which shall open for the Franchisee
business opportunities to which it would have no access as a
stand-alone duty-free or other retail business and which shall
translate into the Franchisee’s ability to compete in the
globally competitive environment of the duty free business while
reducing its own business risks.






 




IX.

WHEREAS, the Franchisor is prepared to
franchise certain of the Dufry Group trademarks and its business
related intangibles to implement in the Franchisee’s local
business as well as provide access to its Global Distribution
Centers to the Franchisee in return for a franchise fee as this
term is defined in Article 6.






 




 

Page 2













 



NOW THEREFORE in consideration of the mutual covenants and
agreements hereinafter contained and for other good and valuable
consideration (the receipt and sufficiency of which is acknowledged
by each of the Parties hereto) the Parties covenant and agree each
with the other as follows:


 


 

 


[Remainder of
page intentionally left
blank]

 


 




 

Page 3








 



III. DEFINITIONS AND INTERPRETATION

 


A.
DEFINITIONS

 


For the
purposes of this Agreement, the following terms shall have the
following meanings:

 




●

“Affiliate”
shall mean any subsidiary or controlled affiliate, which includes
any legal entity that is directly or indirectly, through the
majority of voiting rights, equity capital or otherwise by
exercising a controlling influence, controlled by a
Party.





 




●

“Agreement”
shall mean this Agreement including all Exhibits and as amended
from time to time.





 




●

"Effective Date"
shall mean the date as from which this Agreement shall be deemed
effective in accordance with Article 4 below.





 




●

“Territory”
shall mean the Territory referred to in Article 2.





 




●

“IP
Rights” shall mean collectively certain trademarks, marketing
intangibles and any other intellectual property rights, which are
legally and/or economically owned by the Franchisor, or to which
the Franchisor has a right of use, including the “business
concept”, and which Franchisor has designated to be used by
Franchisee under this Agreement.





 




●

“Business
Concept” shall mean the Dufry Group’s business concept
in the area of travel retail sales, as described in Article 3 of
this Agreement.





 




●

“Centralised
Support Services” shall mean all services as outlined in
Exhibit 1.





 




●

“Global
Distribution Centers” shall mean the central purchasing and
logistic platforms operated by the Dufry Group.





 




●

“Duty
Free” shall mean shops located in or product sales made in an
environment exempt from customs duties and/or value added
taxes.





 




●

“Duty
Paid” shall mean shops located in or product sales made in an
environment subject to ordinary local duties and/or value added
taxes.





 




●

“Franchise”
shall mean all elements of the Franchise as defined in Article 3 of
this Agreement and in Exhibit 1, which may be reviewed and updated
from time to time by Franchisor, including, as the case may be: i)
the “trademark(s)”; ii) the “business
concept”; iii) access to the Global Distribution
Centers”; iv) all supporting or related business intangibles;
and v) all centralised support services.





 




●

“Franchise
Fee” shall mean the consideration payable by the Franchisee
to the Franchisor for the Franchise referred to and calculated in
Article 6.





 




●

“Net
Sales” shall mean the gross sales in Shops in the Territory
of the Franchisee and its sub-franchisees, less discounts and value
added tax as referred to in Article 6.





 




 

Page 4









 




●

"The Dufry Group"
shall mean all the companies affiliated to the Parties by
whatsoever corporate links in whatever jurisdiction.





 




●

“Party”
or “Parties” shall mean the Franchisor and/or the
Franchisee referred to alone or collectively.





 




●

“Shops”
shall mean brick and mortar travel retail outlets, spaces, or
concessions operated by the Franchisee and its permitted
sub-franchisees (if any) in the Territory with the approval of
Franchisor.





 


 


B.
INTERPRETATION GUIDELINES

 




●

A reference to a
person, corporation, trust, partnership, unincorporated body or
other entity includes any of them.





 




●

A reference to an
article, a clause, a chapter or a schedule is a reference to an
article, a clause, a chapter or a schedule of this
Agreement.





 




●

The singular
includes the plural and conversely, unless otherwise expressly
indicated.





 




 

Page 5








 



IV. COVENANTS


 

 


Article 1  Object


 


Subject
to and in accordance with the terms and conditions of this
Agreement, the Franchisor agrees to grant and hereby grants to
Franchisee the right to use the franchise as further defined under
Article 3 below (hereinafter referred to as
“Franchise”) for the purpose of the operation of its
Shops in the Territory.


 


This
Agreement sets forth the terms and conditions under which the
Franchisee may use the Franchise and shall remunerate the
Franchisor for the Franchise as well as the respective rights and
obligations of both Parties under the terms of this
grant.


 


Article 2  Territory


This
Agreement shall be valid within the continental United States,
Hawaii and Canada. (hereinafter referred to as the
“Territory”).


 


Article 3  Franchise


The
elements of the Franchise include the following:


 




(i)

Trademarks






 




(ii)

Business
Concept






 




(iii)

Access to the
Global Distribution Centers






 




(iv)

Supporting Business
Related IP






 




(v)

Centralised Support
Services






 


A more
detailed description of these elements is included in Exhibit 1 to
this Agreement, which shall be considered as an integral part of
this Agreement and may be updated and/or amended by Franchisor in
its sole discretion from time to time, including, without
limitation, to reflect changes and/or developments in the IP Rights
portfolio of Franchisor, as may be made available by the Franchisor
to the Franchisee from time to time.


 


The
Franchisor is entitled to outsource to third parties the total or
part of the delivery of the Franchise elements, i.e. the Franchisor
may engage (without the Franchisee’s consent) third parties
for the execution of the entire or part of the Franchise Agreement
as sub-contractors whereby such a sub-contracting relationship
between a sub-contractor and the Franchisor does not affect in any
manner the Francisee and no legal relationship shall be deemed to
exist between the Franchisee and sub-contractors.


 


The
Franchisor is in no case obliged to notify or otherwise inform the
Franchisee about any kind of delegation and/or outsourcing to third
parties in connection with this Agreement.


 




 

Page 6









 


Article 4  Effective Date - Validity


This
Agreement shall be effective as from January 1, 2018, which shall
be deemed to be the Effective Date. This Agreement is of unlimited
duration and shall remain in force until terminated in accordance
with Article 19 hereunder.


 


The
Parties mutually agree that any prior concluded franchise agreement
between the Parties shall be deemed terminated in its entirety as
per January 1, 2018. They shall procure that such franchise
agreements be terminated as of that date. In particular, they shall
procure that the franchise agreement between


 




●

Dufry International
AG and Dufry Newark Inc, dated September 30, 2005








●

Dufry International
AG and Dufry New York Inc, dated September 30, 2005








●

Dufry International
AG and Dufry Houston Duty Free & Retail Partnership, dated
September 30, 2005








●

Dufry International
AG and The Nuance Group (US) Inc, dated December 2011,
2015






 


terminate
as of said date.


 


Article 5  Sub-Franchise


The
Franchisee has the full right to grant sub-franchises to its
Affiliates. The Franchisee shall not under the terms of this
Agreement have the right to grant sub-franchises to any other third
parties without Franchisor’s prior consent, which shall not
be unreasonably withheld. Franchisee shall procure that any of its
sub-franchisees fully comply with the terms and conditions of this
Agreement and Franchisee shall be responsible for any acts (and
omissions) of its sub-franchisees as if they were Franchisee's own
acts (and omissions).


 


Article 6  Remuneration


As a
consideration for the Franchise granted hereby, Franchisee commits
to remunerate Franchisor with a fee (hereinafter referred to as
“the Franchise Fee”) which shall amount to the
percentage of the Net Sales achieved in the Territory as defined in
Exhibit
2, which shall be considered an integral part of this
Agreement.


 


This
Franchise Fee will be reviewed periodically to ensure that it
remains in line with internationally recognised transfer pricing
rules such as the OECD report on “Transfer Pricing Guidelines
for Multinational Enterprises and Tax Administrations”
effective 2017 with subsequent updates. In case any such transfer
pricing rules require the Franchise Fee to be adjusted, Franchisor
shall have the right to adjust the Franchise Fee accordingly and
such adjustment shall be binding upon Franchisee.


 


For the
purpose of this Agreement the Franchisee’s “net
sales” achieved in the Territory shall mean the gross sales
by Franchisee and its sub-franchisees in the Shops less any
discounts and/or value added taxes.


 


Article 7  Payments


The
payment of the Franchise Fee shall be made by the Franchisee to the
Franchisor on a monthly basis, namely in accordance with the
following rules:


 




 

Page 7









 




(i)

Within 30 (thirty)
days as from the last day of a calendar month the Franchisee will
submit to the Franchisor a monthly statement (hereinafter
“the Monthly Statement”) for the foregoing calendar
month containing the amount of Net Sales and the calculation of the
corresponding Franchise Fee.






 




(ii)

Not later than 30
(thirty) days as from the date of the Monthly Statement, the
Franchisee shall pay to the Franchisor the amount due corresponding
to the Monthly Statement.






 




(iii)

Interest of 0.5 %
per month will be charged on all late payments.






 




(iv)

All payments shall
be made in USD by wire transfer to a bank account to be specified
by the Franchisor and duly communicated to the
Franchisee.






 




(v)

Franchisee shall
retain for a period of at least 10 years, and provide to Franchisor
upon its request, all records and supporting evidence necessary for
Franchisor to verify the Monthly Statement, the Net Sales and the
calculation of the Franchise Fee.





 


Article 8  Franchisee’s Rights And
Obligations


 


8.1  Exercise of Franchise


The
Franchisee has the right and the obligation to use the Franchise in
accordance with the terms and conditions of this Agreement and
Franchisor's instructions during the term of validity of this
Agreement. Furthermore the Franchisee acknowledges and agrees that
the Franchise granted in this Agreement applies only in connection
with the Shops and the products and – if at all applicable
– services sold therein and may not be used for any other
purpose.


 


All use
of the Franchise shall conform fully with all policies, standards
and instructions of the Franchisor supplied to the Franchisee from
time to time. The Franchisee hereby undertakes to exercise the
Franchise in a manner which is not in any way detrimental to the
business and/or the reputation of the Franchisor and the Dufry
Group.


 


8.2  Use of Intellectual Property


The
Franchisee commits to use the IP Rights at a minimum to the extent
required by law for the maintenance of the valid registration of
the Trademarks and the survival of marketing intangibles. The
Franchisee acknowledges and agrees that the rights granted in this
Agreement for the use of the IP Rights apply only to their use in
connection with the operation of the Shops.


 


All use
of the IP Rights shall conform fully with all written policies,
standards and instructions of the Franchisor supplied to the
Franchisee from time to time. The Franchisee may not use the IP
Rights in a manner, which would injure the reputation or goodwill
of the Franchisor or the Dufry Group. The Franchisee further agrees
that it will not use the IP Rights for activities, products and
services, which are not within the scope of business operation of
the Shops.


 




 

Page 8









 


The
Franchisee hereby agrees that any use of the IP Rights by the
Franchisee outside the terms and conditions of this Agreement is
and shall be deemed as infringement of the Franchisor's
rights.


 


8.3  Exclusivity


The
Franchisee commits to abstain, as long as this Agreement remains in
force, from entering into any third party franchise to be fully or
partially exercised in the Shops without prior written permission
from the Franchisor.


 


Article 9  The Franchisor’s Rights And
Obligations


 


9.1  Provision of Materials


The
Franchisor undertakes to provide the Franchisee with the rights
owned by or licensed to Franchisor and with information and
materials which Franchisor deems necessary or convenient in order
to enable the Franchisee to use the Franchise in accordance with
this Agreement.


 


9.2  Coaching


The
Franchisor undertakes hereby to provide the Franchisee, at the
Franchisee’s reasonable request, with the training and
coaching of personnel, which is, in Franchisor's reasonable
assessment, required for the Franchisee to be in a position to
properly exercise the Franchise as set out in this
Agreement.


 


9.3  Exclusivity


The
Franchisor commits to abstain, as long as this Agreement remains in
force, from granting to any other person or entity which is not a
member of the Dufry Group a Franchise valid for the
Territory.


 


9.4  Trademark Maintenance


Without
prejudice to any other term of this Agreement (including, without
limitation, Articles 14 and 15), Franchisor undertakes to use
its commercially reasonable best efforts to maintain and defend the
Trademark during the term of this Agreement. Notwithstanding the
foregoing in this Article 9.4, the Parties agree that Franchisor
may in its sole discretion at any time during the term of this
Agreement make changes to the IP Rights, including, without
limitation, by amending the Trademark and/or any of the marketing
intangibles and/or by amending, adding and/or removing trademark
registrations to resp. from the scope of the license
grant.


 


Article 10  Ownership Of Intellectual Property


The
Parties hereto hereby acknowledge that between the Parties the
Franchisor is the exclusive owner or has otherwise the exclusive
right to use and license the IP Rights and all goodwill associated
therewith. Furthermore the Parties expressly agree that except as
expressly provided in this Agreement, the Franchisee acquires no
right, title or interest in any of the IP Rights or related
marketing intangibles. The Franchisee shall not in any manner
represent that it has any ownership interest in the IP Rights or
applications thereof. The Franchisee may not at any time dispute or
contest, directly or indirectly, the validity, ownership or
enforceability of any of the IP Rights, nor directly or indirectly
attempt to dilute the value of the goodwill attached to any of the
IP Rights.


 




 

Page 9









 


Article 11  Registration Of The Franchisee As Registered
User


Should
the registration of the Franchisee as registered user of the IP
Rights be possible, necessary or convenient in any public or
private register, the Franchisee agrees, upon request by the
Franchisor made at any time after the execution of this Agreement,
to join the Franchisor in applying for such registration as
registered user or any analogue registration in respect to the IP
Rights or a part of them. The Franchisee agrees to execute all
documents and do all acts necessary or convenient to obtain such
registration, as well as any documents, which might be necessary
for the variation, completion or cancellation of such
registration.


 


The
Franchisee shall not at any time during the term of this Agreement
or at any time after its termination use its capacity as registered
user of the IP Rights to do any act or assist any person in doing
any act which may in any way invalidate, impair or prejudice the
rights or title of the Franchisor, whichever nature these rights
might have, in the IP Rights.


 


Article 12  Other Marketing Intangibles


As far
as registered or registerable, the Franchisee undertakes hereby not
to register the Trademarks and/or marketing intangibles or any
marketing intangibles confusingly similar thereto. Any application
or registration in breach of this Article shall enure to the
benefit of and be beneficially owned by the Franchisor. The
Franchisee shall assign to the Franchisor at Franchisor’s
request and own expense all rights, title and interest in any such
application or registration.


 


Article 13  Quality Control, Inspection &
Reporting

 


13.1  Quality Control


The
Franchisee agrees that it shall only exercise the Franchise within
the scope of business of the Shops and that such operation shall
conform in nature and quality and shall be performed by the
Franchisee in compliance with this Agreement, as well as in
accordance with the quality standards and specifications set by the
Franchisor, in its sole discretion from time to time. Without
limiting the foregoing, the Franchisee agrees that the operation of
the Franchise by the Franchisee shall be of high quality standards
prevailing in the sector and consistent with that quality standard
maintained by the Franchisor in connection with comparable
businesses. The Franchisee further agrees that the operation of the
Franchise shall be in conformity with all laws, rules and
regulations applicable to the Franchisee as well as with the laws
applicable in the Territory.


 


13.2  Inspection


The
Franchisor or its authorised agents shall have the right at any
time to inspect the Shops, the performance thereof and any relevant
documents, materials and records related to the Shops in order to
determine whether the Franchisee has complied with its obligations
under this Agreement.


 




 

Page
10









 


13.3  Reporting

 


The
Franchisee agrees to maintain adequate books and records and to
report to the Franchisor at the latter's request about the exercise
of the Franchise by Franchisee and its permitted sub-franchisees
and their compliance with the terms and conditions of this
Agreement. For the purposes of this reporting, the Franchisor shall
be entitled to provide the Franchisee with a standard form to be
filled in by the Franchisee. The Franchisee undertakes further, at
the request of the Franchisor, to have its statutory independent
auditors certifying the completeness and accuracy of such
reports.


 


Article 14  Infringement By Unauthorised Persons


The
Franchisee agrees to immediately give notice to the Franchisor of
any conflicting use or any act of infringement or passing off by
unauthorised persons which comes to its or its sub-franchisees
attention and which involves the Franchise and/or IP Rights or any
variation or imitation thereof. Upon Franchisor's request,
Franchisee shall provide at its own cost all reasonable support and
assistance to Franchisor in any action taken by Franchisor to
defend against any infringement of and/or to enforce its
rights.


 


Article 15  Infringement of Third Parties’
Rights


The
Franchisee agrees to immediately give notice to the Franchisor of
any demand, claim and/or action involving the Franchise and/or IP
Rights that is made or threatened by any person against the
Franchisee and/or any of its sub-franchisees. Franchisee shall, and
shall cause its relevant sub-franchisee(s) to, upon Franchisor's
option and request, allow (i) either Franchisor to undertake the
defence against any such demand, claim and/or action or (ii) defend
against such demand, claim and/or action in accordance with
Franchisor's instructions. Franchisee and/or its sub-franchisees
shall not agree to any settlement or any judicial finding or award
that is reviewable by a higher authority without the express prior
written approval of Franchisor. Franchisee shall, and shall cause
its relevant sub-franchisee(s) to, further implement the measures
identified by Franchisor to prevent any further infringement of any
third party rights by the use of the Franchise and/or the IP
Rights.


 


Article 16  Confidentiality


Both
Parties acknowledge that by virtue of this Agreement they may have
direct or indirect access and acquire knowledge of the other
Party’s confidential information. Both Parties undertake
hereby to hold in absolute confidence all and any information and
not to use, disclose, reproduce or dispose of any information in
any manner other than (i) as expressly provided for in this
Agreement, or (ii) required under applicable law or regulation, in
the good understanding that the undertaking contemplated in this
Article 16 shall survive in case of termination of this Agreement,
being irrelevant the reasons of such a termination.


 


Article 17  Transferability


Except
as provided for in Article 3, this Agreement and all rights and
obligations arising here from shall not be transferred by either
Party to a third party without the express previous consent from
the other Party, which shall be in writing.


 




 

Page
11









 


Article 18  No Represenations or Warranties


Notwithstanding
any other provision in this Agreement, Franchisee acknowledges and
agrees that the Franchise and the IP Rights are made available to
Franchisee on an "as-is" basis without any representation or
warranty, including, without limitation, without any representation
or warranty regarding the validity, enforceability and/or
non-infringement of the IP Rights. To the maximum extent permitted
by applicable law, Franchisor hereby disclaims any liability for
any damages or detrimental consequences which may arise for the
Franchisee as a direct or indirect consequence of the
Franchisee’s exercise of its rights or fulfilment of its
obligations under this Agreement.






Article 19  Termination

 


19.1  Ordinary Termination


The
Franchisor may at any time and in its sole discretion terminate
this Agreement by serving a prior termination notice of 6 (six)
months to the Franchisee.


 

19.2 
Extraordinary Termination


In the
event either Party defaults on its obligations as provided for in
this Agreement, the other Party shall give the defaulting Party
written notice of said default. If the defaulting Party does not
cure said default to the satisfaction of the other Party and
notifies in writing such other Party of such cure within 10 (ten)
calendar days after receipt of the notice of default, then the
Party having given notice of default may terminate this Agreement.
This termination shall then be effective immediately upon
notification of termination.


 


Notwithstanding
the foregoing paragraph, the Franchisee shall be deemed to be in
default under this Agreement and this Agreement and all rights
granted therein shall be deemed to be terminated effective
immediately, without notice or prior opportunity to cure the
default in the following cases:


 



(i) 

If an application
or order is made, proceedings are commenced, a resolution is passed
or an application to court is made or whatsoever steps are taken
which might lead to the Franchisee's winding-up, dissolution,
declaration of bankruptcy or insolvency, appointment of an
administrator or controller or custodian or similar officer over
all or any of its assets (including any undertaking of the
Franchisee or any step preliminary to such appointment), assignment
for the benefit of creditors or the appointment of a receiver or
trustee for the assets.






 



(ii) 

If there is any
change in the ownership of more than 15% of the Franchisee's voting
stock (other than in case of Dufry group internal restructuings),
including but not limited to the case of expropriation,
nationalisation or whatsoever manner of exercise of governmental
control upon the Franchisee.






 


The
Parties further agree that this Agreement shall terminate upon the
effective date of any termination or expiry, if any, of the Master
Relationship Agreement entered into between Franchisor and Hudson
Ltd. dated February 1, 2018.


 




 

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Article 20  Effects of Termination


Upon
the proper termination of this Agreement for any reason whatsoever,
the Franchisee shall immediately cease to be a franchisee of the
Franchisor and shall immediately cease to exercise, directly or
indirectly, through any of its sub-franchisees, in any manner
whatsoever any rights arising out of the Franchise and shall,
forthwith upon request by the Franchisor, sign all documents and
take such actions as may be necessary to cancel any registration in
whatsoever register of the Franchisee as a user of the Trademarks.
Further the Franchisee shall return to the Franchisor, at the sole
discretion of the Franchisor, all materials which have been
provided by the Franchisor.


 


Without
prejudice to the foregoing in this Article 20, in case of a
termination by Franchisor without cause based on Article 19.1,
upon request of Franchisee, Franchisor will use its commercially
reasonable efforts to provide, on a case by case basis, to
Franchisee and/or its permitted sub-franchisees who, as of the
receipt by Franchisee of Franchisor's termination notice, operate
certain Shops in good faith reliance on the continued duration of
this Agreement, the right to continue to use the reasonably
necessary IP Rights for the operation of the relevant Shop(s) for a
limited term. Each such continued use shall: (i) fully comply with
the terms and conditions of this Agreement (including, without
limitation, regarding remuneration), which shall continue to remain
in force insofar as the operation of the relevant Shop(s) is
concerned (but, for the avoidance of doubt, not with regard to any
other Shops and/or any other use of the IP Rights); (ii) be limited
to the use expressly permitted by Franchisor on a case by case
basis; (iii) cease immediately without further notice required in
case of any breach of the terms and conditions of this Agreement by
Franchiseee and/or its permitted sub-franchisee that is not
remedied within 30 (thirty) days after Franchisor's request; and
(iv) cease immediately without further notice required, in respect
of each Shop for which an extension based on this Article 20 is
granted, upon the expiry of the remainder of the minimum term of
the concession, lease or similar agreement applicable to the
relevant Shop as in effect as of the receipt by Franchisee of
Franchisor's termination notice (without any extension or
prolongation).


 


Article 21  No Goodwill Redundancy On Termination


Any and
all goodwill which accrues or which has accrued from the Franchise
has accrued and shall accrue for the benefit of the Franchisor and
if so requested by the Franchisor at any time or on the termination
of this Agreement, the Franchisee shall assign all goodwill to the
Franchisor.


 


For the
case that the Franchisee has prior to the date of execution of this
Agreement already exercised any right inherent to the Franchise,
the Franchisee acknowledges that all such use has been under the
control of the Franchisor. Insofar as the Franchisee might have
been regarded as the proprietor of the IP Rights for the purposes
of any applicable law, the Franchisee hereby confirms that it has
abandoned in favour of the Franchisor its proprietorship in the IP
Rights.


 


Consequently,
upon the proper termination of this Agreement for any reason
whatsoever, the Franchisee shall in no case be entitled to receive
from the Franchisor any kind of compensation, redundancy fee or
whatever payment from the Franchisor on the basis of any goodwill
which might have arisen out of the Franchisee’s compliance
with its obligations under this Agreement.


 




 

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In the
unlikely case that any applicable law would vest the Franchisee
with any right to claim from the Franchisor any payment based on
goodwill, the Franchisee hereby waives, to the full extend
permitted by law, any right to claim such payment and
simultaneously declares hereby that, in case of its entitlement
being compulsory by law, it hereby assigns any payment in full to
the Franchisor without requesting any compensation
therefore.


 


Article 22  Entire Agreement


This
Agreement and its Exhibit hereto constitute the entire agreement
between the Parties in connection to the subject matter hereof and
supersede all prior agreements, understandings, negotiations and
discussions with respect to the subject matter hereof whether
written or oral. Except as provided in this Agreement and its
Exhibit, there are no conditions, representations, warranties,
undertakings, promises, inducements or agreements whether direct or
indirect, collateral, expressed or implied made by the Franchisor
to the Franchisee.


 


No
supplement, modification or waiver of this Agreement shall be
binding unless executed in writing by authorised officers of the
Franchisor and the Franchisee.


 


Article 23  Other Contractual Relationships Between The
Parties


The
Parties hereto acknowledge that they have or may have in the future
other contractual relationships between them. It is both
Parties’ interest and intention that the different
contractual relationships between the Parties are kept separated
from each other and that the matters regulated in this Agreement
shall in no way be affected by any term or condition other than
those set forth in this Agreement.


 


Article 24  Severability


The
invalidity or unenforceability of any provision or any covenant of
this Agreement in any jurisdiction shall not affect the validity or
enforceability of such provision or covenant in any other
jurisdiction or of any other provision or covenant hereof or herein
contained and any invalid provision or covenant shall be deemed to
be severable. The Parties shall negotiate in good faith in order to
replace the provision declared invalid or unenforceable with a new
provision, valid and enforceable, which preserves the original
intention of the Parties.


 


Article 25  Successors And Assignees


This
Agreement shall enure to the benefit of and be binding upon the
Franchisor and the Franchisee and their respective legal
representatives, successors and permitted assignees.


 




 

Page
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Article 26  Independent Parties


The
Franchisee is and will at all times remain an independent party of
the Franchisor and is not and shall not represent itself to be the
agent, joint venturer or partner of the Franchisor. No
representations will be made or acts taken by the Franchisee which
could establish any apparent relationship of agency, joint venture
or partnership and the Franchisor shall not be bound in any manner
whatsoever by any agreements, warranties or representations made by
the Franchisee to any other person or with respect to any other
action of the Franchisee. No acts of assistance given by the
Franchisor to the Franchisee shall be construed to alter this
relationship.

 


Article 27  Costs And Taxes

 


27.1  Costs


All
costs related to the preparation and execution of this Agreement
shall be borne by the Franchisor. For the avoidance of doubt, this
Article 27.1 shall not apply to the costs of the use of the
Franchise, including, without limitation, the operation of the
Shops, by Franchisee and its sub-franchisees.


 


27.2  Taxes


The
Franchisor shall be completely responsible for any taxes now or
hereafter imposed on the Franchisor with respect to the
transactions contemplated hereunder, and the Franchisee shall be
completely responsible for any taxes now or hereafter imposed on
the Franchisee with respect to the transactions contemplated
hereunder.


 


All
sums payable to the Franchisor under or in connection with this
Agreement shall be calculated excluding any VAT or any other
applicable taxes. In this Agreement "VAT" means Value Added Tax and
includes any similar tax replacing it or adding to it. Therefore
the Franchisee shall also pay to the Franchisor an amount equal to
the amount of any VAT chargeable according to the applicable tax
regime in each case.


 


If
under the applicable legal dispositions in the Franchisee’s
jurisdiction, any amount to be paid to the Franchisor is subject to
withholding tax, the latter will be subject to taxation at the
relevant tax rate, so that the Franchisor receives the amount
agreed net of withholding tax. To the extent applicable law
requires any such amounts to be paid by the Franchisee directly to
a governmental authority, the Franchisee shall pay such amounts
promptly and receipts or other proof of such payment shall be
provided to the Franchisor immediately upon receipt. If the
Franchisee fails to pay these withholding taxes, will indemnify the
Franchisor for the full amount of such taxes, including any losses
occasioned by its failure to withhold any taxes imposed by any
local jurisdiction on amounts payable by the Franchisee, and for
any liability (including penalties, interest, and expenses) arising
from or concerning the payment of such taxes, whether such
withholding taxes were correctly or legally asserted or
not.


 


Whenever
an Agreement for the avoidance of double taxation between the
involved countries is available, the Franchisee shall provide the
Franchisor with a Certificate of Tax Residence within the meaning
of such agreement.


 


The
Franchisee shall bear the cost and be responsible for the payment
of stamp duty, if any, applicable to this Agreement.


 




 

Page
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All
other taxes imposed, such as turnover taxes, which may be imposed
now or in the future, will be the Franchisee ́s responsibility
and will not affect its obligations to make payments as required
under this Agreement.


 


Article 28  Force Majeure


Neither
the Franchisor nor the Franchisee shall be liable in damages, or
shall be subject to termination of this Agreement by the other
Party, for any delay or default in performing any obligation
hereunder if that delay or default is due to any cause beyond the
reasonable control and without fault or negligence of that Party,
provided that, in order to excuse its delay or default hereunder, a
Party shall notify the other of the occurrence or the cause,
specifying the nature and particulars thereof and the expected
duration thereof, and provided, further, that within 15 (fifteen)
calendar days after the termination of such occurrence or cause,
that Party shall give notice to the other Party specifying the date
of termination thereof. All obligations of both Parties shall
return to being in full force and effect upon termination of such
occurrence or clause.


 


For the
purposes of this Agreement, a "cause beyond the reasonable control"
of a Party shall include, without limiting the generality of the
phrase, any act of God, act of any government (excepting the causes
contained in Article 19.2), or other statutory undertaking,
industrial dispute, fire, explosion, accident, power failure,
flood, riot, or war (declared or undeclared).


 


Article 29  Non-Waiver And Cumulative Rights


The
failure of either Party to exercise any right, power or option
given hereunder or to insist upon the compliance with the terms and
conditions hereof by the other Party shall not constitute a waiver
of the terms and conditions of this Agreement with respect to that
or any other or subsequent breach thereof nor a waiver by the
non-exercising Party of its rights at any time thereafter to
require strict compliance with all terms and conditions hereof
including the terms or conditions with respect to which
non-complying Party has failed to exercise such right or option.
The rights of each Party hereunder are cumulative.


 


Article 30  Notices


All
notices, consents and approvals (hereinafter referred to as a
"Notice") permitted or required to be given hereunder shall be
deemed to be sufficiently and duly given if written and delivered
personally or sent by courier or transmitted by facsimile
transmission or other form of recorded communication tested prior
to transmission, addressed as follows:


 

For the
Franchisor:         Dufry
International AG


Brunngässlein
12


CH-4010
Basel


Switzerland


 

For the
Franchisee:         Hudson
Group (HG) Inc


One
Meadowlands Plaza, 11th Floor


East
Rutherford


New
Jersey, 07073


USA


 




 

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Any
Notice so given shall be deemed to have been received on the date
of delivery if sent by courier, facsimile transmission or other
form of recorded communication, as the case may be. Either Party
from time to time by Notice may change its address for the purposes
of this Agreement.


 


Article 31  Applicable Law


This
Agreement shall be governed and construed in accordance with the
substantive laws of Switzerland, excluding
its conflict of laws principles and excluding the UN Convention on
Contracts for the International Sale of Goods.


 


Article 32  Dispute Resolution and Arbitration


Any
dispute, controversy or claim arising out of or relating to this
Agreement, or the validity, interpretation, breach or termination
thereof, or any agreement or action contemplated thereby (a
“Dispute”), shall be resolved in accordance with the
procedures set forth in this Article 32, which shall be the sole
and exclusive procedures for the resolution of any such Dispute
unless otherwise specified below.


 


The
Board of Directors of either Party may submit any Dispute for
resolution by mediation in accordance with the Swiss Rules of
Commercial Mediation of the Swiss Chambers’ Arbitration
Institution in force on the date when the request for mediation was
submitted in accordance with these Rules. The seat of the mediation
shall be Zurich, although the meetings may be held elsewhere. The
mediation proceedings shall be conducted in English.


 


If a
Dispute is not resolved by mediation as provided in this Article 32
within thirty (30) days of the selection of a mediator (unless the
mediator chooses to withdraw sooner), either Party may submit the
Dispute to be finally resolved by arbitration pursuant in
accordance with the Swiss Rules of International Arbitration of the
Swiss Chambers’ Arbitration Institution in force on the date
when the Notice of Arbitration was submitted in accordance with
those Rules. The Parties consent to a single, consolidated
arbitration for all known Disputes existing at the time of the
arbitration and for which arbitration is permitted.


 


The
number of arbitrators shall be three. The seat of the arbitration
shall be in Zurich. The arbitral proceedings shall be conducted in
English. The arbitration shall be conducted in accordance with the
provisions for expedited procedure.


 


Article 33  Further Assurances


The
Parties hereto agree to do or cause to be done all acts or things
necessary to implement and carry into effect this Agreement to its
full extent, including any kind of public deed or official document
which could be required according to the laws of Switzerland, the
laws of the Territory or to the laws applying to either the
Franchisee or the Franchiser.


 




 

Page
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IN WITNESS THEREOF the Parties hereto have entered into this
Franchising Agreement on the date and place set hereunder and have
executed it in two originals, both of them together constituting
one and the same document.


 



For The Franchisor (Dufry International AG):


 



DATED at Basel this 1st day of February 2018


 






	
Signature:  



	
/s/
Julián
Díaz González


	

 

	

Signature:  



	
/s/
Andreas
Schneiter

	

 


	
Name:    



	
Julián
Díaz González


	

 

	

Name:  



	
Andreas
Schneiter

	

 


	
Title:  



	
Director



	

 

	

Title:  



	
Director

	

 






 











 



For The Franchisee (Hudson Group (HG) Inc):


 



DATED at Basel this 1st day of February 2018


 






	Signature:	
/s/
Julián
Díaz González 


	

 

	


Signature:  





	
/s/
Andreas
Schneiter

	

 


	Name:  	
Julián
Díaz González 


	

 

	Name:  	
Andreas
Schneiter


	

 


	Title:  	
Director 



	

 

	Title:  	Director
	

 














 




 

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18








 



EXHIBIT 1: COMPONENTS OF THE FRANCHISE

 



The list herein below represents only an overview of the components
of the Franchise and is not meant to be exhaustive. The scope of
the Centralised Support Services, which may vary from time to time,
shall be at the sole discretion of the Franchisor. The application
of the Dufry Group Trademarks has to be compliant with "Dufry
Corporate Identity Guidelines" as updated from time to time. Should
an envisaged application not be covered by the "Dufry Corporate
Identity Guidelines" the Franchisors approval is
required.


 




(i)

Trademarks:






 




●

The Dufry
Brands/Trademarks:








o

DUFRY








o

NUANCE








o

WORLD DUTY FREE
GROUP






(including
“DUFRY” master brand logo and “” signage, as
well as applicable colours and fonts);


 




●

Global Brand
Guidelines (technical details regarding application of the
brands);






 




●

Guidance and
training on how to utilise the logos and brands within stores (e.g.
on banners, logos, point of sale machines, sales tickets, plastic
bags etc);






 




●

Guidance and
training on how to utilise the master brand logo and brands on
stationery (letters, business cards, signage etc); and






 




●

Trademark
registrations and legal protection by the Franchisor.






 




(ii)

Business
Concept:






 




●

Commercial Concepts
for the traditional duty-free business (DUFRY, WDFG &
NUANCE)






 




●

Store Product
Category Concepts;






 




●

Store Operating
Concept;






 




●

The VIP Discount
Card;






 




●

Special Offers
Brochure (issued 3/4 times a year in major stores);






 




●

Calendar of
Promotions (month by month calendar of promotions designed for
every Store);






 




●

Corporate Web-Sites
including Pre-Order Platforms; and






 




●

Development of
Alternative Sales Channels.






 




 

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(iii)

Access
to Global Distribution Center:






 




●

Access to
replenishing tools; and






 




●

Access to central
datawarehouse structures such as Dufry Central Information System
(DCIS).






 




(iv)

Supporting
Business Related IP:






 




●

Marketing
Knowhow;






 




●

Product
Assortment;






 




●

Standardised
Business Procedures;






 




●

Central Management
of Promotion and Advertising Activities;






 




●

Dufry Magazines
& Corporate Communication;






 




●

Central
Industry/Market/Sales Knowledge;






 




●

Sales Staff
Training; and






 




●

Tender and Business
Development Support.






 




(v)

Centralised
Support Services:






 




●

Treasury Services
including Intragroup Financing and FX Hedging;






 




●

Internal Audit
including Loss Prevention Program;






 




●

Legal
Services;






 




●

Tax
Support;






 




●

Global Insurance
Programs; and






 




●

Budgeting,
Controlling and Performance Analysis Support.






 




 

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EXHIBIT 2: FRANCHISE FEE


 


The
Franchise fee rate payable by the Franchisee to the Franchisor
shall be set at:


 


Duty
Free Sales under the DUFRY trademark


3%
(THREE PERCENT) of the Net Sales of the Franchisee.


 


Duty
Free Sales under the NUANCE trademark


3%
(THREE PERCENT) of the Net Sales of the Franchisee.


 


Duty
Free Sales under the WORLD DUTY FREE trademark


3%
(THREE PERCENT) of the Net Sales of the Franchisee.


 


Duty
Free Sales under the franchise concept but not under a trademark(s)
of the Dufry Group


2% (TWO
PERCENT) of the Net Sales of the Franchisee.


 


Duty
Paid Sales under the franchise concept whether or not under a
trademark(s) of the Dufry Group (“Endorsement Fee”)


0.35%
(POINT THREE FIVE PERCENT) of the Net Sales of the
Franchisee


 




 

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