Exhibit

4.2




 









 




 




GUARANTEE AND COLLATERAL AGREEMENT




 




 




made by




 




 




GUESS? IP HOLDER L.P.




 




 




in favor of




 




 




BNY MIDWEST TRUST COMPANY,




 




as Indenture Trustee




 




 




Dated as of April 28, 2003




 








 









 





























 




TABLE OF CONTENTS




 




	

  SECTION 1.


  	

  DEFINED TERMS


  
	

   


  	

   


  
	

  1.1


  	

  Definitions


  
	

  1.2


  	

  Other

  Definitional Provisions


  
	

   


  	

   


  
	

  SECTION 2.


  	

  GUARANTEE


  
	

   


  	

   


  
	

  2.1


  	

  Guarantee


  
	

  2.2


  	

  No

  Subrogation


  
	

  2.3


  	

  Amendments,

  etc. with respect to the Issuer Obligations


  
	

  2.4


  	

  Guarantee

  Absolute and Unconditional


  
	

  2.5


  	

  Reinstatement


  
	

  2.6


  	

  Payments


  
	

   


  	

   


  
	

  SECTION 3.


  	

  GRANT OF SECURITY INTEREST


  
	

   


  	

   


  
	

  SECTION 4.


  	

  REPRESENTATIONS AND WARRANTIES


  
	

   


  	

   


  
	

  4.1


  	

  Title; No

  Other Liens


  
	

  4.2


  	

  Perfected

  First Priority Liens


  
	

  4.3


  	

  Jurisdiction

  of Organization; Chief Executive Office


  
	

  4.4


  	

  General

  Intangibles


  
	

   


  	

   


  
	

  SECTION 5.


  	

  COVENANTS


  
	

   


  	

   


  
	

  5.1


  	

  Delivery of

  Instruments, Certificated Securities and Chattel Paper


  
	

  5.2


  	

  Payment of

  Obligations


  
	

  5.3


  	

  Maintenance

  of Perfected Security Interest; Further Documentation


  
	

  5.4


  	

  Changes in

  Locations, Name, etc


  
	

  5.5


  	

  Notices


  
	

  5.6


  	

  Maintenance

  of Separate Existence


  
	

  5.7


  	

  Negative

  Covenants


  
	

  5.8


  	

  Existence


  
	

  5.9


  	

  Restrictions

  on Certain Actions


  
	

  5.10


  	

  Performance

  of Obligations


  
	

  5.11


  	

  Perfection

  of Intellectual Property after the Closing Date


  
	

   


  	

   


  
	

  SECTION 6.


  	

  REMEDIAL PROVISIONS


  
	

   


  	

   


  
	

  6.1


  	

  Communications

  with Obligors; IP Holder Remains Liable


  
	

  6.2


  	

  Proceeds to

  be Turned Over To Indenture Trustee


  
	

  6.3


  	

  Application

  of Proceeds


  
	

  6.4


  	

  Code and

  Other Remedies


  
	

  6.5


  	

  Intercreditor

  Issues


  





 




i





























 




	

  6.6


  	

  Non

  Disturbance


  
	

   


  	

   


  
	

  SECTION 7.


  	

  THE INDENTURE TRUSTEE


  
	

   


  	

   


  
	

  7.1


  	

  Indenture

  Trustee’s Appointment as Attorney-in-Fact, etc


  
	

  7.2


  	

  Duty of

  Indenture Trustee


  
	

  7.3


  	

  Execution

  of Financing Statements


  
	

  7.4


  	

  Authority

  of Indenture Trustee


  
	

   


  	

   


  
	

  SECTION 8.


  	

  MISCELLANEOUS


  
	

   


  	

   


  
	

  8.1


  	

  Amendments

  in Writing


  
	

  8.2


  	

  Notices


  
	

  8.3


  	

  No Waiver

  by Course of Conduct; Cumulative Remedies


  
	

  8.4


  	

  Enforcement

  Expenses; Indemnification


  
	

  8.5


  	

  Successors

  and Assigns


  
	

  8.6


  	

  Counterparts


  
	

  8.7


  	

  Severability


  
	

  8.8


  	

  Section

  Headings


  
	

  8.9


  	

  Integration


  
	

  8.10


  	

  GOVERNING

  LAW


  
	

  8.11


  	

  Submission

  To Jurisdiction; Waivers


  
	

  8.12


  	

  Acknowledgements


  
	

  8.13


  	

  Releases


  
	

  8.14


  	

  WAIVER OF

  JURY TRIAL


  
	

   


  	

   


  
	

  SCHEDULES


  	

   


  
	

   


  	

   


  
	

  Schedule 1


  	

  Notice Addresses


  
	

  Schedule 2


  	

  Perfection Matters


  
	

  Schedule 3


  	

  Jurisdictions of Organization and Chief Executive Offices


  





 




ii





























 




GUARANTEE AND COLLATERAL AGREEMENT, dated as of April 28, 2003 (this “Agreement”),

made by Guess? IP Holder L.P. (the “IP Holder”) in favor of BNY Midwest

Trust Company (the “Indenture Trustee”) for the benefit of the holders

of notes (the “Noteholders”) issued pursuant to the Indenture, dated as

of April 28, 2003 (as amended, supplemented or otherwise modified from time to

time, the “Indenture”) between the Indenture Trustee and Guess? Royalty

Finance LLC (the “Issuer”).




 




W  I  T  N

E  S  S  E  T  H:




 




 




WHEREAS, pursuant to the Indenture, the Noteholders have severally

agreed to purchase notes (the “Notes”) from the Issuer upon the terms

and subject to the conditions set forth therein;




 




WHEREAS, it is a condition to the Noteholders’ purchase of the Notes

that IP Holder shall have executed and delivered this Agreement to the

Indenture Trustee for the benefit of the Noteholders; and




 




WHEREAS, IP Holder will derive substantial direct and indirect benefit

from the proceeds of the sale of the Notes;




 




NOW, THEREFORE, in consideration of the premises and to induce the

Noteholders to purchase the Notes, IP Holder hereby agrees with the Indenture

Trustee, for the benefit of the Noteholders, as follows:




 




SECTION 1.   DEFINED TERMS




 




1.1                                 Definitions.  (a) 

Unless otherwise defined herein, terms defined in Annex X attached hereto

and used herein shall have the meanings given to them in Annex X. 




 




(b)                                 The

following terms are used herein as defined in the New York UCC:  Accounts, Certificated Security, Chattel

Paper, Documents, General Intangibles, Instruments, and Supporting Obligations.




 




1.2                                 Other

Definitional Provisions.  (a)  The words “hereof,” “herein”, “hereto” and

“hereunder” and words of similar import when used in this Agreement shall refer

to this Agreement as a whole and not to any particular provision of this Agreement,

and Section and Schedule references are to this Agreement unless otherwise

specified.




 




(b)                                 The

meanings given to terms defined herein shall be equally applicable to both the

singular and plural forms of such terms.




 




SECTION 2.   GUARANTEE




 




2.1                                 Guarantee.  (a) 

IP Holder hereby unconditionally and irrevocably, guarantees as

principal, and not as surety, to the Indenture Trustee, for the benefit of the

Noteholders and their respective successors, indorsees, transferees and

assigns, the prompt and complete payment and performance by the Issuer of the

Issuer Obligations. 




 





























 




(b)                                 Upon

the occurrence of an Event of Default, the Indenture Trustee will demand for

payment hereunder; provided that the Indenture Trustee, on behalf of the

Noteholders, may not appropriate and realize upon the Guarantee Collateral, or

any part thereof, until the occurrence of any Enforcement Event.




 




(c)                                  The

guarantee contained in this Section 2 shall remain in full force and effect

until all the Issuer Obligations and the obligations of IP Holder under the

guarantee contained in this Section 2 shall have been satisfied by payment in

full.




 




2.2                                 No

Subrogation.  Notwithstanding any

payment made by IP Holder hereunder, IP Holder shall not be entitled to be

subrogated to any of the rights of the Indenture Trustee or any Noteholder

against the Issuer or any collateral security or guarantee held by the

Indenture Trustee or any Noteholder for the payment of the Issuer Obligations,

nor shall IP Holder seek or be entitled to seek any contribution or

reimbursement from the Issuer until all amounts owing to the Indenture Trustee

and the Noteholders by the Issuer on account of the Issuer Obligations are paid

in full.  If any amount shall be paid to

IP Holder on account of such subrogation rights at any time when all of the

Issuer Obligations shall not have been paid in full, such amount shall be held

by IP Holder in trust for the Indenture Trustee, for the benefit of the

Noteholders, segregated from other funds of IP Holder, and shall, forthwith upon

receipt by IP Holder, be deposited into the Lockbox Account in the exact form

received by IP Holder (duly indorsed by IP Holder to the Indenture Trustee, if

required), to be applied against the Issuer Obligations, whether matured or

unmatured, in accordance with the Indenture.




 




2.3                                 Amendments,

etc. with respect to the Issuer Obligations.  IP Holder shall remain obligated hereunder notwithstanding that,

without any reservation of rights against IP Holder and without notice to or

further assent by IP Holder, any demand for payment of any of the Issuer

Obligations made by the Indenture Trustee or any Noteholder may be rescinded by

the Indenture Trustee or such Noteholder and any of the Issuer Obligations

continued, and the Issuer Obligations, or the liability of any other Person

upon or for any part thereof, or any collateral security or guarantee therefor,

may, from time to time, in whole or in part, be renewed, extended, amended,

modified, accelerated, compromised, waived, surrendered or released by the Indenture

Trustee or any Noteholder, and the Indenture and the other Transaction

Documents and any other documents executed and delivered in connection

therewith may be amended, modified, supplemented or terminated, in whole or in

part, as the Indenture Trustee (in accordance with the terms of such agreements

or documents) may deem advisable from time to time, and any collateral

security, or guarantee at any time held by the Indenture Trustee or any

Noteholder for the payment of the Issuer Obligations may be sold, exchanged,

waived, surrendered or released. 

Neither the Indenture Trustee nor any Noteholder shall have any

obligation to protect, secure, perfect or insure any Lien at any time held by

it as security for the Issuer Obligations or for the guarantee contained in

this Section 2 or any property subject thereto.




 




2.4                                 Guarantee

Absolute and Unconditional.  IP

Holder waives any and all requirement of notice of the creation, renewal,

extension or accrual of any of the Issuer Obligations and notice of or proof of

reliance by the Indenture Trustee or any Noteholder upon the guarantee

contained in this Section 2 or acceptance of the guarantee contained in this

Section 2; the Issuer Obligations, and any of them, shall conclusively be

deemed to have been created, contracted or incurred, or renewed, extended,

amended or waived, in reliance upon the guarantee




 




2





























 




contained in this Section 2;

and all dealings between the Issuer and IP Holder, on the one hand, and the

Indenture Trustee and the Noteholders, on the other hand, likewise shall be

conclusively presumed to have been had or consummated in reliance upon the

guarantee contained in this Section 2. 

IP Holder waives requirement of diligence, presentment, protest, demand

for payment and notice of default or nonpayment to or upon the Issuer with

respect to the Issuer Obligations.  IP

Holder understands and agrees that the guarantee contained in this Section 2

shall be construed as a continuing, absolute and unconditional guarantee of

payment without regard to (a) the validity or enforceability of the Indenture

or any other Transaction Document, any of the Issuer Obligations or any other

collateral security therefor or guarantee or right of offset with respect thereto

at any time or from time to time held by the Indenture Trustee or any

Noteholder, (b) any defense, set-off or counterclaim (other than a defense of

payment or performance) which may at any time be available to or be asserted by

the Issuer, IP Holder or any other Person against the Indenture Trustee or any

Noteholder, or (c) any other circumstance whatsoever (with or without notice to

or knowledge of the Issuer or IP Holder) which constitutes, or might be

construed to constitute, an equitable or legal discharge of the Issuer for the

Issuer Obligations, or of IP Holder under the guarantee contained in this

Section 2, in bankruptcy or in any similar proceeding.  When making any demand hereunder or

otherwise pursuing its rights and remedies hereunder against IP Holder, the

Indenture Trustee or any Noteholder may, but shall be under no obligation to,

make a similar demand on or otherwise pursue such rights and remedies as it may

have against the Issuer, IP Holder or any other Person or against any

collateral security or guarantee for the Issuer Obligations or any right of

offset with respect thereto, and any failure by the Indenture Trustee or any

Noteholder to make any such demand, to pursue such other rights or remedies or

to collect any payments from the Issuer, IP Holder or any other Person or to

realize upon any such collateral security or guarantee or to exercise any such

right of offset, or any release of the Issuer, IP Holder or any other Person or

any such collateral security, guarantee or right of offset, shall not relieve

IP Holder of any obligation or liability hereunder, and shall not impair or

affect the rights and remedies, whether express, implied or available as a

matter of law, of the Indenture Trustee or any Noteholder against IP Holder.  For the purposes hereof “demand” shall

include the commencement and continuance of any legal proceedings by the

Indenture Trustee or any Noteholder with respect to this Agreement, the

Indenture or the Notes .




 




2.5                                 Reinstatement.  The guarantee contained in this Section 2

shall continue to be effective, or be reinstated, as the case may be, if at any

time payment, or any part thereof, of any of the Issuer Obligations is

rescinded or must otherwise be restored or returned by the Indenture Trustee or

any Noteholder upon the insolvency, bankruptcy, dissolution, liquidation or

reorganization of the Issuer or IP Holder, or upon or as a result of the

appointment of a receiver, intervenor or conservator of, or trustee or similar

officer for, the Issuer or IP Holder or any substantial part of its property,

or otherwise, all as though such payments had not been made.




 




2.6                                 Payments.  IP Holder hereby guarantees that payments

hereunder will be timely paid to the Indenture Trustee for deposit in the

Lockbox Account without set-off or counterclaim in Dollars.




 




SECTION 3.   GRANT OF SECURITY

INTEREST




 




IP Holder hereby assigns and transfers to the Indenture Trustee and

hereby grants to the Indenture Trustee, for the benefit of the Noteholders, a

security interest in, all of the




 




3





























 




following property now owned or

at any time hereafter acquired by IP Holder or in which IP Holder now has or at

any time in the future may acquire any right, title or interest (collectively,

the “Guarantee Collateral”), as collateral security for the prompt and

complete payment and performance when due of the Obligations:




 




(a)                                  all

Guess? Trademarks;




 




(b)                                 all

of the Guess? Contributed IP, the Licensing Contributed License Agreements and

the Guess? License Agreement;




 




(c)                                  all

related Accounts;




 




(d)                                 all

books and records pertaining to the Guarantee Collateral; and




 




(e)                                  to

the extent not otherwise included in the foregoing, all Goodwill, the Guess?

Contributed License Agreement Files and Licensing Contributed License Agreement

Files, and all proceeds and Supporting Obligations of any and all of the

foregoing and all collateral security and guarantees given by any Person with

respect to any of the foregoing.




 




Insofar as the foregoing grant of a security interest relates to

amounts included in the Obligations owing to the Back-Up Manager, such grant is

subject to the subordination provisions set forth in the Back-Up Management

Agreement that specify that payments of such amounts to the Back-Up Manager are

subject to the priority of payments set forth in the Indenture.




 




SECTION 4.   REPRESENTATIONS AND

WARRANTIES




 




To induce the Noteholders to purchase the Notes issued under the

Indenture, IP Holder hereby represents and warrants to the Indenture Trustee,

for the benefit of the Noteholders that:




 




4.1                                 Title;

No Other Liens.  Except for the

Permitted Liens, IP Holder has good and marketable title to each item of the

Guarantee Collateral free and clear of any and all Liens, claims or

encumbrances of others.  No financing

statement or other public notice with respect to all or any part of the

Guarantee Collateral is on file or of record in any public office, except such

as have been filed (i) pursuant to the Guess? Contribution Agreement, Licensing

Contribution Agreement or Receivables Contribution Agreement or (ii) in favor

of the Indenture Trustee, for the benefit of the Noteholders, pursuant to this

Agreement or the Indenture or such as have been properly amended or

terminated.  For the avoidance of doubt,

it is understood and agreed that IP Holder has and will continue to grant, as

part of its business, licenses to third parties to use the Guess? Trademarks

owned or developed by IP Holder.  Such

licensing activities constitute Permitted Liens.  Each of the Indenture Trustee and each Noteholder understands

that any such licenses may be exclusive to the applicable licensees, and such

exclusivity provisions may limit the ability of the Indenture Trustee to

utilize, sell, lease or transfer the Guess? Trademarks or otherwise realize

value from the Guess? Trademarks pursuant hereto.




 




4





























 




4.2                                 Perfected

Liens.  The security interests

granted pursuant to this Agreement (a) upon completion of the filing of all

appropriate financing statements in the proper filing office and other actions

specified on Schedule 2 (which, in the case of all filings and other

documents referred to on said Schedule, have been delivered to the Indenture

Trustee in completed and duly executed form) will constitute valid and

continuing first priority perfected security interests in all of the Guarantee

Collateral in favor of the Indenture Trustee, for the benefit of the

Noteholders, as collateral security for the Obligations, enforceable in

accordance with the terms hereof against IP Holder and all creditors of IP

Holder and any Persons purporting to purchase any Guarantee Collateral from IP

Holder and (b) are prior to all other Liens on the Guarantee Collateral in

existence on the date hereof except for Permitted Liens.  Other than Liens created pursuant to the

Transaction Documents, IP Holder has not pledged, assigned, sold, granted a

security interest in, or otherwise conveyed any of the Guarantee Collateral.  IP Holder has not authorized the filing of

and is not aware of any financing statements against IP Holder that include a

description of collateral covering the Guarantee Collateral other than any

financing statement relating to the security interest granted to the Indenture

Trustee hereunder  or otherwise pursuant

to the Transaction Documents.  IP Holder

is not aware of any judgment or tax lien filings against IP Holder (other than

Permitted Liens).




 




4.3                                 Jurisdiction

of Organization; Chief Executive Office. 

On the date hereof, IP Holder’s jurisdiction of organization and

identification number from the jurisdiction of organization are specified on

Schedule 3.  IP Holder has furnished to

the Indenture Trustee a certified charter, certificate of incorporation or

other organization document and good standing certificate as of a date which is

recent to the date hereof.




 




4.4                                 General

Intangibles.  The Guess? Trademarks

and Subject License Agreements constitute General Intangibles and/or marks

registered with the United States Patent and Trademark Office in accordance with

15 U.S.C. et seq.




 




4.5                                 Guarantee

Collateral.  Reference is made to

the representations and warranties set forth in Section 3.03 of the Guess?

Contribution Agreement, Section 3.03 of the Licensing Contribution Agreement,

and Section 8.01 of the Guess? License Agreement.  IP Holder hereby adopts as its own and confirms the accuracy as

of the date hereof, being deemed to restate here to the same extent as if set

forth in full herein, all such representations and warranties with respect to

all of the items of Guarantee Collateral to the Indenture Trustee for the

benefit of the Noteholders.




 




SECTION 5.   COVENANTS




 




IP Holder covenants and agrees with the Indenture Trustee that, from

and after the date of this Agreement until the Obligations shall have been paid

in full:




 




5.1                                 Delivery

of Instruments, Certificated Securities and Chattel Paper.  If any amount payable under or in connection

with any of the Guarantee Collateral shall be or become evidenced by any

Instrument, Certificated Security or Chattel Paper, such Instrument,

Certificated Security or Chattel Paper shall be immediately delivered to the

Indenture Trustee, duly indorsed in a manner satisfactory to the Indenture

Trustee, to be held as Guarantee Collateral pursuant to this Agreement.




 




5





























 




5.2                                 Payment

of Obligations.  IP Holder will pay

and discharge or otherwise satisfy at or before maturity or before they become

delinquent, as the case may be, all taxes, assessments and governmental charges

or levies imposed upon the Guarantee Collateral or in respect of income or

profits therefrom, as well as all claims of any kind against or with respect to

the Guarantee Collateral, except that no such charge need be paid if the amount

or validity thereof is currently being contested in good faith by appropriate

proceedings; reserves in conformity with GAAP with respect thereto have been

provided on the books of IP Holder; and such proceedings are not reasonably

likely to result in the sale, forfeiture or loss of any material portion of the

Guarantee Collateral or any interest therein. 






 




5.3                                 Maintenance

of Perfected Security Interest; Further Documentation.  (a) 

IP Holder shall maintain the security interest created by this Agreement

as a perfected security interest having at least the priority described in

Section 4.2 and shall defend such security interest against the claims and

demands of all Persons whomsoever.  IP

Holder also shall maintain its ownership and other interests in the Guarantee

Collateral as to which filings or other actions are required in non-U.S.

jurisdictions by timely making all such filings or taking all such actions and

shall defend such ownership or other interests against the claims and demands

of all Persons whomsoever.




 




(b)                                 At

any time and from time to time, upon the written request of the Indenture

Trustee, and at the sole expense of IP Holder, IP Holder will promptly and duly

execute and deliver, and have recorded, such further instruments and documents

and take such further actions as the Indenture Trustee may reasonably request

for the purpose of obtaining or preserving the full benefits of this Agreement

and of the rights and powers herein granted, including, without limitation, (i)

filing any financing or continuation statements under the Uniform Commercial

Code (or other similar laws) in effect in any jurisdiction with respect to the

security interests created hereby, (ii) in the case of any Guarantee

Collateral, taking any actions necessary to enable the Indenture Trustee to

obtain “control” (within the meaning of the applicable Uniform Commercial Code)

with respect thereto to the extent “control” is the basis for perfecting the

Indenture Trustee’s security interest therein and (iii) in the case of the

Intellectual Property (including any license agreements or intellectual

property that become Intellectual Property after the date of this Agreement),

any registration in the United States Patent and Trademark Office and any other

filings as may be required by applicable Requirements of Law or by the laws of

any non-U.S. jurisdiction.




 




5.4                                 Changes

in Locations, Name, etc.  IP Holder

will not, except upon 15 days’ prior written notice to the Indenture Trustee

and delivery to the Indenture Trustee of all additional executed financing

statements and other documents reasonably requested by the Indenture Trustee to

maintain the validity, perfection and priority of the security interests

provided for herein (i) change its jurisdiction of organization from that

referred to in Section 4.3 or (ii) change its name.




 




5.5                                 Notices.  IP Holder will advise the Indenture Trustee

promptly, in reasonable detail, of:




 




6





























 




(a)                                  any

Lien (other than any Permitted Lien) on any of the Guarantee Collateral which

would adversely affect the ability of the Indenture Trustee to exercise any of

its remedies hereunder;




 




(b)                                 of

the occurrence of any other event which could reasonably be expected to have a

material adverse effect on the aggregate value of the Guarantee Collateral or

on the security interests created hereby; and




 




(c)                                  each

Rapid Amortization Event, Trapping Event and Event of Default under the

Indenture, a Servicer Default under the Servicing Agreement or an Enforcement

Event under this Guarantee.




 




5.6                                 Maintenance

of Separate Existence.  IP Holder

shall:




 




(a)                                  maintain

its own deposit account or accounts, separate from those of any Affiliate, with

commercial banking institutions and ensure that the funds of IP Holder will not

be diverted to any other Person or for other than organizational uses of IP

Holder, nor will such funds be commingled with the funds of Guess? or any other

Subsidiary or Affiliate of Guess?;




 




(b)                                 to

the extent that it shares the same officers or other employees as any of its

partners or Affiliates, ensure that the salaries of and the expenses related to

providing benefits to such officers and other employees shall be fairly

allocated among such entities, and ensure that each such entity shall bear its

fair share of the salary and benefit costs associated with all such common

officers and employees;




 




(c)                                  to

the extent that it jointly contracts with any of its partners or Affiliates to

do business with vendors or service providers or to share overhead expenses,

ensure that the costs incurred in so doing shall be allocated fairly among such

entities, and ensure that each such entity shall bear its fair share of such

costs.  To the extent that IP Holder

contracts or does business with vendors or service providers where the goods

and services provided are partially for the benefit of any other Person, the

costs incurred in so doing shall be fairly allocated to or among such entities

for whose benefit the goods or services are provided, and each such entity

shall bear its fair share of such costs. 

All material transactions between IP Holder and any of its Affiliates,

whether currently existing or hereafter entered into, shall be only on an arm’s

length basis, it being understood and agreed that the transactions contemplated

in the Transaction Documents meet the requirements of this clause (c);




 




(d)                                 maintain

a principal executive office at a separate address from the address of Guess?

and its Affiliates; provided, that segregated offices in the same

building shall constitute separate addresses for purposes of this clause

(d).  To the extent that IP Holder and

any of its partners or Affiliates have offices in the same location, there

shall be a fair and appropriate allocation of overhead costs among them, and

each such entity shall bear its fair share of such expenses;




 




(e)                                  issue

separate financial statements prepared at least annually and prepared in

accordance with generally accepted accounting principles;




 




7





























 




(f)                                    conduct

its affairs in its own name and strictly in accordance with its organizational

documents and observe all necessary, appropriate and customary organizational

formalities, including, but not limited to, holding all regular and special

partners or directors’ meetings appropriate to authorize all organizational

action, keeping separate and accurate minutes of its meetings, passing all

resolutions or consents necessary to authorize actions taken or to be taken,

and maintaining accurate and separate books, records and accounts, including,

but not limited to, payroll and intercompany transaction accounts;




 




(g)                                 not

assume or guarantee any of the liabilities of Guess? or any Affiliate thereof

(other than pursuant to the Transaction Documents);




 




(h)                                 take,

or refrain from taking, as the case may be, all other actions that are

necessary to be taken or not to be taken in order to (i) ensure that the

assumptions and factual recitations set forth in the Bankruptcy Opinion remain

true and correct in all material respects with respect to IP Holder and (ii)

comply with those procedures described in such provisions which are applicable

to IP Holder; and




 




(i)                                     comply

with the covenants and agreements set forth in its agreement of limited

partnership.




 




5.7                                 Negative

Covenants.  So long as this

Guarantee is in effect or any Notes are outstanding, IP Holder shall not:




 




(a)                                  except

as expressly permitted or required by the Transaction Documents, sell,

transfer, exchange or otherwise dispose of, or permit the sale, transfer or

other disposition of, any of the Intellectual Property or any interest therein;




 




(b)                                 (i)

permit the validity or effectiveness of this Guarantee to be impaired, or

permit the Lien created by this Guarantee to be amended, hypothecated,

subordinated, terminated or discharged, (ii) permit any Lien to be created on

or extended to or otherwise arise upon or burden the Guarantee Collateral or

any part thereof or any interest therein or the proceeds thereof (other than

Permitted Liens), (iii) permit the Lien created by this Guarantee not to

constitute a valid first priority perfected security interest in the Guarantee

Collateral;




 




(c)                                  dissolve

or liquidate in whole or in part;




 




(d)                                 issue,

incur, assume, guarantee or otherwise become liable, directly or indirectly,

for any indebtedness for borrowed money except for the Permitted Indebtedness;




 




(e)                                  except

as contemplated by the Transaction Documents, make any loan or advance or

credit to, or guarantee (directly or indirectly or by an instrument having the

effect of assuring another’s payment or performance on any obligation or

capability of so doing or otherwise), endorse or otherwise become contingently

liable, directly or indirectly, in connection with the obligations, stocks or

dividends of, or own, purchase, repurchase or acquire (or agree contingently to

do so) any stock, obligations, assets or securities of, or any other interest

in, or make any capital contribution to, any other Person;




 




8





























 




(f)                                    make

any expenditure (by long-term or operating lease or otherwise) for capital

assets (either realty or personalty);




 




(g)                                 at

any time when an Event of Default has occurred and is continuing, directly or

indirectly, (i) pay any dividend or make any distribution (by reduction of

capital or otherwise), whether in cash, property, securities or a combination

thereof, to any owner of a beneficial interest in IP Holder or otherwise with

respect to any ownership or equity interest in or of IP Holder, (ii) redeem,

purchase, retire or otherwise acquire for value any such ownership or equity

interest or (iii) set aside or otherwise segregate any amounts for any such

purpose;




 




(h)                                 except

as expressly contemplated herein and in the other Transaction Documents,

consolidate or merge with or into any other Person or sell, lease or otherwise

transfer, directly or indirectly, all or any substantial part of its assets to

any other Person or sell, lease or otherwise transfer, directly or indirectly,

all or any substantial part of its assets to any other Person, other than its

grant of the Guarantee Collateral pursuant to this Agreement and the grant of

the Subject IP pursuant to the Receivables Contribution Agreement; or




 




(i)                                     engage

in any business activity other than as required or contemplated hereunder and

in the other Transaction Documents, or such other activities that are

necessary, suitable or desirable to accomplish the foregoing or are incidental

thereto.




 




5.8                                 Existence.  IP Holder will preserve, renew and keep in

full force and effects its limited partnership existence and rights, privileges

and franchises necessary or desirable in the normal conduct of business.




 




5.9                                 Restrictions

on Certain Actions.  IP Holder will

not take, or knowingly permit to be taken, any action which would terminate or

discharge or prejudice the validity or effectiveness of any of the Transaction

Documents or the validity, effectiveness or priority of the Liens created

thereby or permit any party to any of the Transaction Documents whose

obligations form part of the security created by this Guarantee to be released

from such obligations.  IP Holder will

not license any Subject Trademark to Guess?, Inc. or any of its affiliates on

an exclusive basis except upon certification by the Back-Up Manager that such

license contains commercially reasonable terms that unaffiliated third parties

reasonably would accept as licensees or licensors.  IP Holder will not enter into any license of any Subject

Trademark or permit Guess?, Inc., as licensee under the Guess? License

Agreement, to enter into any sublicense of any Subject Trademark, on an

exclusive basis with any third party to the extent that so doing would violate

any material provision of any Subject License. 

Subject to the foregoing sentences, IP Holder is permitted to license,

and to authorize Guess?, Inc. as licensee under the Guess? License Agreement,

to sublicense Subject Trademarks on an exclusive basis, so long as any such

license contains commercially reasonable terms that unaffiliated third parties

reasonably would accept as licensees or licensors.




 




5.10                           Performance

of Obligations.  IP Holder will not

take any action and will use its best efforts not to permit any action to be

taken by others that would release any Person from any of such Person’s

covenants or obligations under any instrument or agreement included in the

Guarantee Collateral or that would result in the amendment, hypothecation,

subordination, termination or discharge of, or impair the validity or

effectiveness of, any such instrument or




 




9





























 




agreement, except as ordered by

any bankruptcy or other court or as expressly provided in, or permitted by,

this Guarantee, any other Transaction Document or such other instrument or

agreement.




 




5.11                           Perfection

of Intellectual Property after the Closing Date.  On the Closing Date, IP Holder shall file and record, or shall

cause to be filed and recorded, financing statements and other filing or

recording documents or instruments with respect to the Guarantee Collateral in

each foreign jurisdiction appropriate to perfect the security interests of the

Indenture Trustee under this Agreement. 

On or prior to the Closing Date, IP Holder shall have delivered a form

of opinion from special Italian counsel to the Issuer, addressed to the Indenture

Trustee, with respect to the creation and enforceability of a perfected

first-priority security interest in the Guarantee Collateral that is located in

or subject to the laws of Italy, with such conditions, exceptions and

exclusions as are customary in Italy, as applicable, and which is satisfactory

to the purchasers purchasing the Notes on the Closing Date.  The final opinion shall be delivered within

2 weeks after the Closing Date, and within 90 days of the Closing Date a

security interest in such Italian collateral shall be filed and perfected.  IP Holder shall pay the related registration

tax at the time of filing.




 




IP Holder will

continue to establish quality standards with respect to the production,

manufacture, marketing, distribution and sale of goods appropriate to the

reasonable maintenance of the existence of and value as Guarantee Collateral of

the Subject Trademarks; provided that the foregoing does not in any sense limit

IP Holder’s right to approve any Downstreaming or to allow any licensee or the

Servicer or any successor Servicer to Downstream in accordance with the

provisions of the Transaction Documents, any Subject License (as the same may

be modified in accordance with the limitations of the Transaction Documents)

and, in the case of the Guess? License Agreement, past and future business

practices of the Trademark Originator undertaken in the sole discretion of the

Trademark Originator.




 




5.12                           Survival

and Non-Waiver of Representations and Warranties.  So long as this Guarantee is in effect and any Notes are

outstanding, IP Holder agrees that (a) each representation and warranty made by

IP Holder pursuant to Sections 4.1, 4.2 and 4.4 of this Agreement (the

“Surviving Representations and Warranties”) shall survive and (b) IP Holder

shall not waive, by course of conduct or in writing, any of the Surviving

Representations and Warranties.




 




SECTION 6.   REMEDIAL PROVISIONS




 




6.1                                 Communications

with Obligors; IP Holder Remains Liable. 

(a)  The Indenture Trustee in its

own name or in the name of others may at any time after the occurrence and

during the continuance of an Enforcement Event communicate with parties to the

License Agreements to verify with them to the Indenture Trustee’s satisfaction

the existence and terms of such License Agreements.




 




(b)                                 Upon

the request of the Indenture Trustee at any time after the occurrence and

during the continuance of an Enforcement Event, IP Holder shall notify the

parties to the License Agreements that the License Agreements have been

assigned to the Indenture Trustee for the benefit of the Noteholders.




 




10





























 




(c)                                  Anything

herein to the contrary notwithstanding, IP Holder shall remain liable under

each of the License Agreements to observe and perform all the conditions and

obligations to be observed and performed by it thereunder, all in accordance

with the terms of any agreement giving rise thereto.  Neither the Indenture Trustee nor any Noteholder shall have any

obligation or liability under any License Agreements by reason of or arising

out of this Agreement or the receipt by the Indenture Trustee or any Noteholder

of any payment relating thereto, nor shall the Indenture Trustee or any

Noteholder be obligated in any manner to perform any of the obligations of IP

Holder under or pursuant to any License Agreement, to make any payment, to make

any inquiry as to the nature or the sufficiency of any payment received by it

or as to the sufficiency of any performance by any party thereunder, to present

or file any claim, to take any action to enforce any performance or to collect

the payment of any amounts which may have been assigned to it or to which it

may be entitled at any time or times.




 




6.2                                 Proceeds

to be Turned Over To Indenture Trustee. 

If an Enforcement Event shall occur and be continuing, all proceeds of

Guarantee Collateral received by IP Holder consisting of cash, checks and other

near-cash items shall be remitted within two Business Days of receipt thereof

by IP Holder to the Indenture Trustee in the exact form received by IP Holder

(duly indorsed by IP Holder to the Indenture Trustee, if required) and be

deposited by Indenture Trustee in the exact from received by the Indenture

Trustee into the Lockbox Account.  All

proceeds deposited in the Lockbox Account or held by IP Holder in trust for the

Indenture Trustee (for the benefit of the Noteholders) shall be collateral

security for all the Obligations and shall not constitute payment thereof until

applied as provided in Section 6.3.




 




6.3                                 Application

of Proceeds.  Proceeds received and

held as described in Section 6.2 shall be applied in accordance with Section

5.7 of the Indenture.  Any balance of

such proceeds remaining after the Obligations shall have been paid in full

shall be paid over to whomsoever may be lawfully entitled to receive the same.  




 




6.4                                 Code

and Other Remedies.  If an

Enforcement Event shall occur and be continuing, the Indenture Trustee, on

behalf of the Noteholders, may exercise, in addition to all other rights and

remedies granted to them in this Agreement and in any other instrument or

agreement securing, evidencing or relating to the Obligations, all rights and

remedies of a secured party under the New York UCC or any other applicable

law.  Without limiting the generality of

the foregoing, the Indenture Trustee, without demand of performance or other

demand, presentment, protest, advertisement or notice of any kind (except any

notice required by law referred to below) to or upon IP Holder or any other

Person (all and each of which demands, defenses, advertisements and notices are

hereby waived), may in such circumstances forthwith collect, receive,

appropriate and realize upon the Guarantee Collateral, or any part thereof,

and/or may forthwith sell, lease, assign, give option or options to purchase,

or otherwise dispose of and deliver the Guarantee Collateral or any part

thereof (or contract to do any of the foregoing), in one or more parcels at

public or private sale or sales, at any exchange, broker’s board or office of

the Indenture Trustee or elsewhere upon such terms and conditions as it may

deem advisable and at such prices as it may deem best, for cash or on credit or

for future delivery without assumption of any credit risk.  The Indenture Trustee shall have the right

upon any such public sale or sales, and, to the extent permitted by law, upon

any such private sale or sales, to purchase the whole or any part of the

Guarantee Collateral so sold, free of any right or equity of redemption in IP

Holder, which right or equity is hereby waived and released.  IP Holder further agrees, at the




 




11





























 




Indenture Trustee’s request, to

assemble the Guarantee Collateral and make it available to the Indenture

Trustee at IP Holder’s premises.  The

Indenture Trustee shall apply the net proceeds of any action taken by it

pursuant to this Section 6.4, after deducting all reasonable costs and expenses

of every kind incurred in connection therewith or incidental to the care or

safekeeping of any of the Guarantee Collateral or in any way relating to the

Guarantee Collateral or the rights of the Indenture Trustee and the Noteholders

hereunder, including, without limitation, reasonable attorneys’ fees and

disbursements, to the payment in whole or in part of the Obligations, in

accordance with Section 5.7 of the Indenture, and only after such application

and after the payment by the Indenture Trustee of any other amount required by

any provision of law, need the Indenture Trustee account for the surplus, if

any, to IP Holder.  To the extent

permitted by applicable law, IP Holder waives all claims, damages and demands

it may acquire against the Indenture Trustee or any Noteholder arising out of

the exercise by them of any rights hereunder. 

If any notice of a proposed sale or other disposition of Guarantee

Collateral shall be required by law, such notice shall be deemed reasonable and

proper if given at least 10 days before such sale or other disposition.  Notwithstanding the foregoing, the Indenture

Trustee may not sell or otherwise liquidate the Guarantee Collateral pursuant

to the exercise of its rights under this Section, unless (i) it has determined

(or been instructed by the Back-Up Manager) that the proceeds thereof would not

be sufficient to pay in full 100% of the outstanding principal of, accrued interest

on and any Acceleration Premium due on all Notes in connection with such

acceleration of the Notes unless the Indenture Trustee obtains the consent of

holders of 100% of the principal amount of all Outstanding Notes (after such

Noteholders have given Paul Marciano and Maurice Marciano a reasonable

opportunity to express their views of the appropriateness or reasonableness of

various possible remedies, including Downstreaming, provided that the

Noteholders shall be under no obligation whatsoever to follow such views), or

if (ii) it has determined (or been instructed by the Back-Up Manager) that the

proceeds thereof would be sufficient to pay in full 100% of the outstanding

principal of, accrued interest on and any Acceleration Premium due on all Notes

in connection with such acceleration of the Notes, unless the Indenture Trustee

obtains the consent of the Majority Holders (after such Noteholders have given

Paul Marciano and Maurice Marciano a reasonable opportunity to express their

views of the appropriateness or reasonableness of various possible remedies

including Downstreaming, provided that the Noteholders shall be under no

obligation whatsoever to follow such views). 

The Majority Holders will be deemed to have consented to the sale or

other liquidation of the Indenture Collateral pursuant to clause (ii) of the

prior sentence if Noteholders holding a majority of the principal amount of the

Notes Outstanding either vote in favor of such action or fail to vote with

respect to such action within 30 Business Days after receipt of the notice

seeking consent from the Indenture Trustee. 

In determining such sufficiency or insufficiency, the Indenture Trustee

will obtain and rely upon an opinion of an independent investment banking or

accounting firm of national reputation as to the feasibility of such proposed

action and as to the sufficiency of the Guarantee Collateral for such purpose.




 




6.5                                 Intercreditor

Issues.  If the security interest

hereunder and the security interest under the Receivables Contribution

Agreement are enforceable concurrently, the Indenture Trustee may elect to

enforce the rights under either or both agreements in its absolute discretion.




 




6.6                                 Non

Disturbance.  Notwithstanding the

foregoing, the Indenture Trustee and the Noteholders acknowledge and agree that

all remedial actions permitted to be taken by the




 




12





























 




Indenture Trustee under this

Agreement and the other Transaction Documents are subject to the provisions of

Section 5.6 of the Indenture, Sections 4.02(c) of the Guess? License Agreement,

Sections 2.02(d) and 6.03(f) of the Servicing Agreement, and Section 5.2(d) of

the Receivables Contribution Agreement. 

For the avoidance of doubt, but not in limitation of the generality of

the foregoing, the Indenture Trustee and the Noteholders acknowledge and agree

that the Indenture Trustee shall not be permitted to take any action that is

reasonably likely to constitute an assignment in gross of the Guess?

Trademarks. 




 




SECTION 7.   THE INDENTURE

TRUSTEE




 




7.1                                 Indenture

Trustee’s Appointment as Attorney-in-Fact, etc.  (a)  IP Holder hereby

irrevocably constitutes and appoints the Indenture Trustee and any officer or

agent thereof, with full power of substitution, as its true and lawful attorney-in-fact

with full irrevocable power and authority in the place and stead of IP Holder

and in the name of IP Holder or in its own name, for the purpose of carrying

out the terms of this Agreement, to take any and all appropriate action and to

execute any and all documents and instruments which may be necessary or

desirable to accomplish the purposes of this Agreement, and, without limiting

the generality of the foregoing, IP Holder hereby gives the Indenture Trustee

the power and right, on behalf of IP Holder, without notice to or assent by IP

Holder, to do any or all of the following:




 




(i)                                     in the name of IP

Holder or its own name, or otherwise, take possession of and indorse and

collect any checks, drafts, notes, acceptances or other instruments for the payment

of moneys due under any License Agreement or with respect to any other

Guarantee Collateral and file any claim or take any other action or proceeding

in any court of law or equity or otherwise deemed appropriate by the Indenture

Trustee for the purpose of collecting any and all such moneys due under any

License Agreement or with respect to any other Guarantee Collateral whenever

payable;




 




(ii)                                  in the case of any

Guess? Contributed Trademarks, execute and deliver, and have recorded, any and

all agreements, instruments, documents and papers as the Indenture Trustee may

request to evidence the Indenture Trustee’s and the Noteholders’ security

interest in such Guess? Contributed Trademarks and the goodwill and general

intangibles of IP Holder relating thereto or represented thereby;




 




(iii)                               pay or discharge taxes

and Liens levied or placed on or threatened against the Guarantee Collateral;




 




(iv)                              execute, in connection

with any sale provided for in Section 6.4, any indorsements, assignments or

other instruments of conveyance or transfer with respect to the Guarantee

Collateral; and




 




(v)                                 (A) direct any party

liable for any payment under any of the Guarantee Collateral to make payment of

any and all moneys due or to become due thereunder directly to the Indenture

Trustee or as the Indenture Trustee shall direct; (B) ask or demand for,

collect, and receive payment of and receipt for, any and all moneys, claims and

other amounts due or to become due to IP Holder at any time in respect of or

arising out of any Guarantee Collateral; (C) commence and prosecute any suits,

actions or




 




13





























 




proceedings at

law or in equity in any court of competent jurisdiction to collect the

Guarantee Collateral or any portion thereof and to enforce any other right in

respect of any Guarantee Collateral; (D) defend any suit, action or proceeding

brought against IP Holder with respect to any Guarantee Collateral; (E) settle,

compromise or adjust any such suit, action or proceeding and, in connection

therewith, give such discharges or releases as the Indenture Trustee may deem

appropriate; (F) assign any Guess? Contributed Trademarks (along with the

goodwill of the business to which any such Guess? Contributed Trademark

pertains), throughout the world for such term or terms, on such conditions, and

in such manner, as the Indenture Trustee shall in its sole discretion

determine; and (G) generally, sell, transfer, pledge and make any agreement

with respect to or otherwise deal with any of the Guarantee Collateral as fully

and completely as though the Indenture Trustee were the absolute owner thereof

for all purposes, and do, at the Indenture Trustee’s option and IP Holder’s

expense, at any time, or from time to time, all acts and things which the Indenture

Trustee deems necessary to protect, preserve or realize upon the Guarantee

Collateral and the Indenture Trustee’s and the Noteholders’ security interests

therein and to effect the intent of this Agreement, all as fully and

effectively as IP Holder might do.




 




Anything in this Section 7.1(a)

to the contrary notwithstanding, the Indenture Trustee agrees that it will not

and can not exercise any rights under the power of attorney provided for in

this Section 7.1(a) unless an Enforcement Event shall have occurred and be

continuing and that nothing herein supercedes Section 6.6 of the Guarantee.




 




(b)                                 If

IP Holder fails to perform or comply with any of its agreements contained

herein, the Indenture Trustee, at its option, but without any obligation so to

do, may perform or comply, or otherwise cause performance or compliance, with

such agreement.




 




(c)                                  The

expenses of the Indenture Trustee incurred in connection with actions

undertaken as provided in this Section 7.1 shall be payable by IP Holder to the

Indenture Trustee on demand.




 




(d)                                 IP

Holder hereby ratifies all that said attorneys shall lawfully do or cause to be

done by virtue hereof.  All powers,

authorizations and agencies contained in this Agreement are coupled with an

interest and are irrevocable until this Agreement is terminated and the

security interests created hereby are released.




 




7.2                                 Duty

of Indenture Trustee.  The Indenture

Trustee’s sole duty with respect to the custody, safekeeping and physical

preservation of the Guarantee Collateral in its possession, under Section 9-207

of the New York UCC or otherwise, shall be to deal with it in the same manner

as the Indenture Trustee deals with similar property for its own account.  Neither the Indenture Trustee, any

Noteholder nor any of their respective officers, directors, employees or agents

shall be liable to IP Holder or Guess? for failure to demand, collect or

realize upon any of the Guarantee Collateral or for any delay in doing so or

shall be under any obligation to sell or otherwise dispose of any Guarantee

Collateral upon the request of IP Holder or any other Person or to take any

other action whatsoever with regard to the Guarantee Collateral or any part

thereof.  The powers conferred on the

Indenture Trustee and the Noteholders hereunder are solely to protect the

Indenture Trustee’s and the Noteholders’




 




14





























 




interests in the Guarantee

Collateral and shall not impose any duty upon the Indenture Trustee or any

Noteholder to exercise any such powers. 

The Indenture Trustee and the Noteholders shall be accountable only for

amounts that they actually receive as a result of the exercise of such powers,

and neither they nor any of their officers, directors, employees or agents

shall be responsible to IP Holder or Guess? for any act or failure to act

hereunder, except for their own gross negligence or willful misconduct.




 




7.3                                 Execution

of Financing Statements.  Pursuant

to any applicable law, IP Holder authorizes the Indenture Trustee to file or

record financing statements and other filing or recording documents or

instruments with respect to the Guarantee Collateral without the signature of

IP Holder in such form and in such offices as the Indenture Trustee determines

appropriate to perfect the security interests of the Indenture Trustee under

this Agreement.  IP Holder hereby

ratifies and authorizes the filing by the Indenture Trustee of any financing

statement with respect to the Guarantee Collateral made prior to the date

hereof.




 




7.4                                 Authority

of Indenture Trustee.  IP Holder

acknowledges that the rights and responsibilities of the Indenture Trustee

under this Agreement with respect to any action taken by the Indenture Trustee

or the exercise or non-exercise by the Indenture Trustee of any request, judgment

or other right or remedy provided for herein or resulting or arising out of

this Agreement shall, as between the Indenture Trustee and the Noteholders, be

governed by the Indenture and by such other agreements with respect thereto as

may exist from time to time among them, but, as between the Indenture Trustee

and IP Holder, the Indenture Trustee shall be conclusively presumed to be

acting as agent for the Noteholders with full and valid authority so to act or

refrain from acting, and IP Holder shall not be under any obligation, or

entitlement, to make any inquiry respecting such authority.




 




SECTION 8.   MISCELLANEOUS




 




8.1                                 Amendments

in Writing.  None of the terms or

provisions of this Agreement may be waived, amended, supplemented or otherwise

modified except by an instrument in writing signed by the Indenture Trustee

(acting in accordance with the Indenture) and IP Holder.




 




8.2                                 Notices.  All notices, requests and demands to or upon

the Indenture Trustee hereunder shall be effected in the manner provided for in

Section 11.4 of the Indenture. Any such notice, request or demand to or upon IP

Holder shall be addressed to IP Holder at its notice address set forth on

Schedule 1.




 




8.3                                 No

Waiver by Course of Conduct; Cumulative Remedies.  Neither the Indenture Trustee nor any Noteholder shall by any act

(except by a written instrument pursuant to Section 8.1), delay, indulgence,

omission or otherwise be deemed to have waived any right or remedy

hereunder.  No failure to exercise, nor

any delay in exercising, on the part of the Indenture Trustee or any

Noteholder, any right, power or privilege hereunder shall operate as a waiver

thereof.  No single or partial exercise

of any right, power or privilege hereunder shall preclude any other or further

exercise thereof or the exercise of any other right, power or privilege.  A waiver by the Indenture Trustee or any

Noteholder of any right or remedy hereunder on any one occasion shall not be

construed as a bar to any right or remedy which the




 




15





























 




Indenture Trustee or such

Noteholder would otherwise have on any future occasion.  The rights and remedies herein provided are

cumulative, may be exercised singly or concurrently and are not exclusive of

any other rights or remedies provided by law.




 




8.4                                 Enforcement

Expenses; Indemnification.  (a)  IP Holder agrees to pay or reimburse the

Noteholders and the Indenture Trustee for all its costs and expenses incurred

in collecting against IP Holder under the guarantee contained in Section 2 and

agrees to pay or reimburse the Noteholders and the Indenture Trustee for

otherwise enforcing or preserving any rights under this Agreement and the other

Transaction Documents to which IP Holder is a party, including, without

limitation, the fees and disbursements of counsel to each Noteholder, and of

counsel to the Indenture Trustee.




 




(b)                                 IP

Holder agrees to pay, and to save the Indenture Trustee and the Noteholders

harmless from, any and all liabilities with respect to, or resulting from any

delay in paying, any and all stamp, excise, sales or other taxes which may be

payable or determined to be payable with respect to any of the Guarantee

Collateral or in connection with any of the transactions contemplated by this

Agreement.




 




(c)                                  IP

Holder agrees to pay, and to save the Indenture Trustee and the Noteholders

harmless from, any and all liabilities, obligations, losses, damages,

penalties, actions, judgments, suits, costs, expenses or disbursements of any

kind or nature whatsoever with respect to the execution, delivery, enforcement,

performance and administration of this Agreement to the extent the Issuer would

be required to do so pursuant to Section 6.7 of the Indenture.




 




(d)                                 The

agreements in this Section 8.4 shall survive repayment of the Obligations and

all other amounts payable under the Indenture and the other Transaction

Documents.




 




8.5                                 Successors

and Assigns.  This Agreement shall

be binding upon the successors and assigns of IP Holder and shall inure to the

benefit of the Indenture Trustee and the Noteholders and their successors and

assigns; provided that IP Holder may not assign, transfer or delegate any of

its rights or obligations under this Agreement without the prior written

consent of the Indenture Trustee.




 




8.6                                 Counterparts.  This Agreement may be executed by one or

more of the parties to this Agreement on any number of separate counterparts

(including by telecopy), and all of said counterparts taken together shall be

deemed to constitute one and the same instrument.




 




8.7                                 Severability.  Any provision of this Agreement which is

prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,

be ineffective to the extent of such prohibition or unenforceability without

invalidating the remaining provisions hereof, and any such prohibition or

unenforceability in any jurisdiction shall not invalidate or render

unenforceable such provision in any other jurisdiction.




 




8.8                                 Section

Headings.  The Section headings used

in this Agreement are for convenience of reference only and are not to affect

the construction hereof or be taken into consideration in the interpretation

hereof.




 




16





























 




8.9                                 Integration.  This Agreement and the other Transaction

Documents represent the agreement of IP Holder, the Indenture Trustee and the

Noteholders with respect to the subject matter hereof and thereof, and there

are no promises, undertakings, representations or warranties by the Indenture

Trustee or any Noteholder relative to subject matter hereof and thereof not

expressly set forth or referred to herein or in the other Transaction

Documents.




 




8.10                           GOVERNING

LAW.  THIS AGREEMENT SHALL BE

GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE

STATE OF NEW YORK.




 




8.11                           Submission

To Jurisdiction; Waivers.  IP Holder

hereby irrevocably and unconditionally:




 




(a)                                  submits

for itself and its property in any legal action or proceeding relating to this

Agreement and the other Transaction Documents to which it is a party, or for

recognition and enforcement of any judgment in respect thereof, to the

non-exclusive general jurisdiction of the courts of the State of New York, the

courts of the United States of America for the Southern District of

New York, and appellate courts from any thereof;




 




(b)                                 consents

that any such action or proceeding may be brought in such courts and waives any

objection that it may now or hereafter have to the venue of any such action or

proceeding in any such court or that such action or proceeding was brought in

an inconvenient court and agrees not to plead or claim the same;




 




(c)                                  agrees

that service of process in any such action or proceeding may be effected by

mailing a copy thereof by registered or certified mail (or any substantially

similar form of mail), postage prepaid, to IP Holder at its address referred to

in Section 8.2 or at such other address of which the Indenture Trustee shall

have been notified pursuant thereto;




 




(d)                                 agrees

that nothing herein shall affect the right to effect service of process in any

other manner permitted by law or shall limit the right to sue in any other

jurisdiction; and




 




(e)                                  waives,

to the maximum extent not prohibited by law, any right it may have to claim or

recover in any legal action or proceeding referred to in this Section any special,

exemplary, punitive or consequential damages.




 




8.12                           Acknowledgements.  IP Holder hereby acknowledges that:




 




(a)                                  it

has been advised by counsel in the negotiation, execution and delivery of this

Agreement and the other Transaction Documents to which it is a party;




 




(b)                                 neither

the Indenture Trustee nor any Noteholder has any fiduciary relationship with or

duty to IP Holder arising out of or in connection with this Agreement or any of

the other Transaction Documents, and the relationship between IP Holder, on the

one hand, and the Indenture Trustee and Noteholders, on the other hand, in

connection herewith or therewith is solely that of debtor and creditor; and




 




17





























 




(c)                                  no

joint venture is created hereby or by the other Transaction Documents or

otherwise exists by virtue of the transactions contemplated hereby among the

Noteholders or among IP Holder and the Noteholders.




 




8.13                           Releases.  (a) 

On the Termination Date, the Guarantee Collateral shall be released from

the Liens created hereby, and this Agreement and all obligations (other than

those expressly stated to survive such termination) of the Indenture Trustee

and IP Holder hereunder shall terminate, all without delivery of any instrument

or performance of any act by any party, and all rights to the Guarantee

Collateral shall revert to IP Holder. 

At the request and sole expense of IP Holder following any such

termination, the Indenture Trustee shall deliver to IP Holder any Guarantee

Collateral held by the Indenture Trustee hereunder, and execute and deliver to

IP Holder such documents as IP Holder shall reasonably request to evidence such

termination.




 




(b)                                 If

any of the Guarantee Collateral shall be sold, transferred or otherwise

disposed of by IP Holder in a transaction permitted by the Indenture or any

Transaction Document, then the Indenture Trustee, at the request and sole

expense of IP Holder, shall execute and deliver to IP Holder all releases or

other documents reasonably necessary or desirable for the release of the Liens

created hereby on such Guarantee Collateral.




 




8.14                           WAIVER

OF JURY TRIAL.  IP HOLDER HEREBY

IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR

PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT AND FOR

ANY COUNTERCLAIM THEREIN.




 




[Rest of page left intentionally blank]




 




18





























 




IN WITNESS WHEREOF, each of the undersigned has caused this Guarantee

and Collateral Agreement to be duly executed and delivered as of the date first

above written.




 




	

   


  	

  GUESS? IP HOLDER L.P.


  
	

   


  	

   


  
	

   


  	

   


  
	

   


  	

  By:


  	

   


  	

   


  
	

   


  	

   


  	

  Name:


  
	

   


  	

   


  	

  Title:


  





 




19