Exhibit 10.25

MEMORANDUM OF UNDERSTANDING

IN RE CUTTER & BUCK INC. SECURITIES LITIGATION
HAIMOWITZ V. CUTTER & BUCK, INC., ET AL.

This
Memorandum of Understanding ("MOU"), dated as of June 13, 2003, contains the essential terms of a settlement (the "Settlement") (a) between defendants Cutter &
Buck Inc. ("CBUK"), Harvey N. Jones and Stephen S. Lowber (collectively, the "Class Defendants"), and the Lead Plaintiff Tilson Growth Fund (the "Class Plaintiff"), on behalf of itself and
members of the class (collectively, the "Class") in connection withIn re Cutter & Buck Inc. Securities Litigation, No.
CV-02-1948L (the "Class Action"), pending in the United States District Court, Western District of Washington (the "Federal Court"); and (b) among defendants CBUK,
Frances M. Conley, Michael S. Brownfield, Larry C. Mounger, James C. Towne, Harvey N. Jones, Martin J. Marks and Stephen S. Lowber (collectively, the "Derivative Defendants") and Morris Haimowitz (the
"Derivative Plaintiff"), derivatively and on behalf of CBUK, in connection withHaimowitz v. Cutter & Buck Inc., et al.,
No. 02-2-32038-4SEA (the "Derivative Action"), pending in the Superior Court of the State of Washington for King County (the "State Court"), that was reached
as a result of CBUK's directors and officers liability insurers', Genesis Insurance Company ("Genesis"), Executive Risk Indemnity, Inc. ("E/Risk"), and Lumbermens Mutual Casualty Company
("Lumbermens") (collectively, the "Insurers"), refusal to consent to, and fund, a settlement that was agreed to in principle in connection with a mediation conducted on May 22, 2003 by the
Honorable J. Lawrence Irving (the "Special Settlement Master"). For purposes of this MOU only, the undersigned counsel for the Class Plaintiff and Derivative Plaintiff, Class Defendants and Derivative
Defendants (individually, a "Party," or collectively, the "Parties") represent that they have the power and authority to bind their respective Parties.

1.     For
settlement purposes only, the Class consists of:



Excluded
from the Class are the Class Defendants and the Derivative Defendants (collectively, the "Defendants"), and persons and entities related to Defendants, including any subsidiaries or
affiliates of CBUK; the officers and directors of CBUK during the Class Period; members of the individual Defendants' immediate families; any person, firm, trust, officer, director or any individual
or entity in which any Defendant has a controlling interest or which is related to, or affiliated with, any of the Defendants, and the legal representatives, agents, affiliates, heirs,
successors-in-interest or assigns of any such excluded person or entity.

2.     The
Settlement Amount of up to $7 million is a joint and several obligation of the Defendants to be paid by CBUK on behalf of all Defendants in settlement of the
Class Action and the Derivative Action as follows: (a) $4 million of the Settlement Amount shall be deposited into an interest bearing escrow account maintained by Milberg Weiss Bershad
Hynes & Lerach LLP not later than ten (10) business days following preliminary approval of the Settlement by the Federal Court; and (b) up to an additional $3 million of
the Settlement Amount shall be paid for the benefit of the Class Plaintiff and Derivative Plaintiff (collectively, the "Plaintiffs"), and the members of the Class, on a non-recourse basis
solely out of Plaintiffs' Share (as defined below), if any, of the Net Recovery (as defined below) from the claims asserted in the action brought by CBUK against Genesis and the other Insurers
captionedCutter & Buck Inc. v. Genesis Insurance Company, et al., No. CV-02-2569P (the "Coverage Action"),
pending in the United States District Court, Western District of Washington. For purposes of this MOU, "Net Recovery" means the total funds, including any award of attorneys' fees, costs, and related
expenses, received by CBUK from Genesis and/or the other Insurers in connection with the Coverage Action, whether by way of settlement or final judgment through trial and any appeal, less the sum of:
(i) the total amount of all attorneys' fees, expert witness fees, and other costs and expenses

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incurred
by CBUK in instituting and prosecuting the Coverage Action (including all such fees and costs incurred prior to the date of this MOU, which approximate $430,000 through April 30,
2003); and (ii) $1 million. For purposes of this MOU, "Plaintiffs' Share" means fifty percent (50%) of up to $6 million of the Net Recovery, thereby providing Plaintiffs with a
maximum potential payment in connection with the Coverage Action of $3 million. Cutter & Buck alone shall retain the total Net Recovery in excess of Plaintiffs' Share.

If
the $4 million of the Settlement Amount to be paid by CBUK not later than ten (10) business days following preliminary approval of the Settlement by the Federal Court,
or any part thereof, is not paid into the escrow account by such date, interest on the unpaid balance, if any, will accrue at 4%per annumfrom such
date until that portion of the Settlement Amount is deposited into escrow. In the event that any portion of the Settlement Amount is not paid by CBUK, the other Defendants shall each have the option
of withdrawing from the Settlement.

3.     CBUK
shall be solely responsible for prosecuting the Coverage Action through trial and any appeal;provided, however,that
CBUK may not enter into any settlement of the Coverage Action without the prior written approval of the Class Plaintiff, which approval may not unreasonably be withheld or delayed. In the event that
CBUK and the Class Plaintiff are unable to agree on the terms of a potential settlement of the Coverage Action, CBUK and the Class Plaintiff agree to submit to the following dispute resolution
procedure:



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4.     The
Settlement Amount does not include any damages or recovery of any kind on claims, if any, against any of the Defendants arising out of, based upon, or attributable or
in any way related to, (a) the Defendants gaining any profit or advantage to which they were not legally entitled; (b) return by the Defendants of any remuneration, compensation or
consideration paid to them by CBUK; (c) return or an accounting by the Defendants of profits made from the purchase and sale or sale and purchase by them of securities of CBUK within the
meaning of §16(b) of the Securities Exchange Act of 1934 and amendments thereto, or similar provisions of any state statutory law or common law; (d) unjust enrichment, restitution
or disgorgement of profits, benefits, compensation or consideration received or obtained by the Defendants from CBUK or in any way connected with their employment by CBUK; or (e) reimbursement
of the premium CBUK paid, and the additional costs it incurred, to obtain National Union Fire Insurance Company of Pittsburgh, Pennsylvania ("National Union") Directors, Officers and Corporate
Liability Insurance Policy No. 002799882 (the "National Union Policy").

5.     In
response to and in settlement of the Derivative Action, the Derivative Plaintiff and CBUK agree that CBUK's current board of directors has or will adopt by resolution,
or other means as appropriate, the changes in CBUK's corporate governance set forth in Exhibit A to this MOU.

6.     Class
Plaintiff and Derivative Plaintiff each agree to settle the Class Action and the Derivative Action, respectively, in accordance with the terms hereof and to dismiss
the complaints in the Class Action and Derivative Action, respectively, with prejudice and without costs to any Party.

7.     Class
Plaintiff agrees to enter into the broadest form of release that releases all Released Claims, as defined in ¶8 below, against all Released Persons, as
defined in ¶9 below, in the Class Action.

8.     For
purposes of the Class Action, "Released Claims" mean all claims, demands, rights, liabilities and causes of action of every nature and description whatsoever, known
or unknown, whether or not concealed or hidden, including, without limitation, claims for negligence, gross negligence, breach of fiduciary duty or care and/or breach of duty of loyalty, fraud, breach
of fiduciary duty, or violations of any state or federal statutes, rules or regulations (collectively, "Claims") that have been, could have been, or in the future could be, asserted by the Class
Plaintiff or any member of the Class against any of the Class Defendants or Released Persons arising out of, based upon, or in any way

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related
to both the purchase of CBUK common stock and/or options during the Class Period and the Claims, facts, transactions, events, occurrences, acts, disclosures, statements, omissions or failures
to act that were asserted, or that might have been asserted, in the original complaints, or in an amended complaint, in the Class Action.

9.     For
purposes of the Class Action, "Released Persons" means each Class Defendant and each Class Defendant's past or present directors, officers, employees, partners,
members, principals, agents, representatives, associates, controlling shareholders, attorneys, accountants, auditors, consultants, advisors, custodians, personal or legal representatives,
predecessors, successors, parents, subsidiaries, divisions, joint ventures, assigns, spouses, marital communities, heirs, estates, related or affiliated entities, and any entity in which a Class
Defendant has a controlling interest, any members of their immediate families or any trust of which any Class Defendant is the settlor or which is for the benefit of any Class Defendant and/or
member(s) of his family;provided, however,Released Persons do not include any insurer of any Class Defendant, including without limitation, any of the
Insurers.

10.   Derivative
Plaintiff agrees to enter into a release that releases all Released Claims, as defined in ¶11 below, against all Released Persons, as defined in
¶12 below, in the Derivative Action.

11.   For
purposes of the Derivative Action, "Released Claims" means all Claims, known or unknown, whether not concealed or hidden, that have been, could have been, or in the
future could be, asserted against the "Released Persons," as defined below, which Claims arise out of, are based upon or attributable or in any way related to, or by reason of their factual or legal
relationship thereto, are in any way connected with, any of the facts, circumstances, allegations, claims, causes of action, representations, statements, financial statements, reports, disclosures,
prospectuses, offering circulars, transactions, events, occurrences, acts or omissions or failures to act, of whatever kind or nature, taking place prior to the execution date of a definitive
Stipulation of Settlement that were, or could have been, alleged in the Derivative Action, by, on behalf of, or for the benefit of (a) Derivative Plaintiff or any shareholder of CBUK, which are
of a derivative nature, or (b) CBUK.

12.   For
purposes of the Derivative Action, "Released Persons" means Defendants, and their respective marital communities and/or estates, if any, and their respective past,
present and future parent companies, subsidiaries, divisions, spouses, heirs, predecessors, successors, assigns, and any entity now or in the past controlled by them or controlling them. Released
Persons do not include, without limitation, Ernst & Young or any insurer of any Defendant, including the Insurers.

13.   For
purposes of the Class Action and Derivative Action, Released Claims do not encompass or include CBUK's Claims, if any, against any of the other Defendants arising
out of, based upon, or attributable or in any way related to, (a) gaining any profit or advantage to which such Defendants were not legally entitled; (b) return by such Defendants of any
remuneration, compensation or consideration paid to them by CBUK, (c) return or any accounting by such Defendants of profit made from the purchase and sale or sale and purchase by them of
securities of CBUK within the meaning of §16(b) of the Securities Exchange Act of 1934 and amendments thereto, or similar provisions of any state statutory law or common law;
(d) unjust enrichment, restitution or disgorgement of profits, benefits, compensation or consideration received or obtained by them from CBUK or in any way connected with their employment by
CBUK, (e) reimbursement of the premium CBUK paid, and the additional costs it incurred, to obtain the National Union Policy; (f) contribution by, or indemnification from, such Defendants
arising out of, based upon, or attributable or in any way related to, the Class Action or any other civil, criminal, administrative and regulatory proceeding; (g) return or reimbursement of any
amounts for which CBUK has indemnified such Defendants under CBUK's Articles of Incorporation or otherwise, (h) CBUK's obligation, if any, to indemnify its present or former directors or
officers to the extent required by its Articles of Incorporation and bylaws, any existing agreements, or any resolutions of its Board of Directors; (i) any loan, advance, indebtedness, note,
contract or agreement in which CBUK is a signator or party, or to which CBUK has or may

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become
subrogated by contract, agreement, operation of law or otherwise; (j) or any obligation that may not be released by law (collectively, the "Non-Released Claims"), which
liability, if any, is expressly reserved, preserved and not released pursuant to this Settlement or dismissal of the Derivative Action with prejudice.

14.   This
Settlement is subject to, and conditioned upon, final approval of the Settlement by the Federal Court and approval of the dismissal of the Derivative Action by the
State Court.

15.   The
parties agree that they will cooperate to expeditiously prepare and execute a definitive Stipulation of Settlement and jointly seek preliminary and final Federal
Court approval of the Settlement as soon as practical. Thereafter, the Parties shall promptly seek approval by the State Court of the dismissal of the Derivative Action.

16.   The
Parties agree that they will cooperate to expeditiously prepare and execute a definitive "blow" provision providing that CBUK shall have the option to withdraw from
and void the Settlement as to all Defendants if 5% or more of the number of shares of CBUK common stock traded during the Class Period opt out.

17.   The
Parties agree that they will cooperate to expeditiously prepare and execute a bar order provision under the Private Securities Litigation Reform Act ("PSLRA") that
will be included in the Stipulation of Settlement providing that all future claims for contribution under any federal, state, or common law by any person or entity against any Released Persons in the
Class Action that arises out of the Class Action is barred under the PSLRA.

18.   All
costs of notice and administration of the Settlement shall be paid out of the Settlement Amount in the escrow account on a non-recourse basis.

19.   This
Settlement is not a claims-made settlement and, if all conditions under the Stipulation of Settlement are satisfied and the Settlement receives final
Federal Court approval and State Court approval for the dismissal of the Derivative Action, no Settlement consideration will be returned to Defendants. Allocation of the Settlement proceeds is the
sole responsibility of Class Plaintiff's counsel.

20.   While
Defendants deny that the claims advanced in the Class Action or Derivative Action were meritorious, Defendants agree and the final judgments in the Class Action
and the Derivative Action (the "Litigation") will state, that the Litigation was filed in good faith and in accordance with the applicable Washington law and Federal Rules of Civil Procedure,
including Rule 11 of the Federal Rules of Civil Procedure and Washington Superior Court Civil Rule 11, and is being settled voluntarily after consultation with competent legal counsel.

21.   Attorneys'
fees and expenses awarded to Class Plaintiff's counsel shall, with Federal Court approval, be paid to Class Plaintiff's counsel immediately upon award,
notwithstanding the existence of any timely filed objections thereto, or potential for appeal therefrom, or collateral attack on the Settlement, subject to the obligation of Class Plaintiff's counsel
to make appropriate refunds or repayments to the Settlement fund plus accrued interest at the rate paid on the escrow account by the financial institution holding it, if and when, as a result of any
appeal and/or further proceedings on remand, or successful collateral attack, the fee or cost award is reduced or reversed. All fees and expenses of counsel for the Derivative Plaintiff shall be paid
solely out of the Settlement Amount in the escrow account.

22.   If
for any reason the Settlement does not become final as defined by the Stipulation of Settlement, or if the Stipulation of Settlement is canceled or terminated, any
and all contributions to the Settlement fund, including accrued interest, less costs of notice and administration and taxes, shall be returned to CBUK.

23.   Defendants
have denied, and continue to deny, that they have committed any violation of federal or state securities laws or other laws, and are entering into this MOU
solely because the

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proposed
Settlement would eliminate the burden and expense of further litigation and the uncertainty of trial. The provisions contained in this MOU shall not be deemed or offered or received in
evidence as a presumption, a concession, or an admission of any fault, liability, or wrongdoing, and, except as required to enforce this MOU or this Settlement, they shall not be offered or received
in evidence or otherwise used in the Class Action or Derivative Action by any Party. The Stipulation of Settlement shall contain a comparable disclaimer of liability.

24.   The
Parties agree to cooperate in issuing a Press Release announcing this Settlement that will be drafted by CBUK subject to review and approval by Class Plaintiff's and
Derivative Plaintiff's counsel within 24 hours of presentment of the draft. Any disagreement concerning the contents of that Press Release shall be resolved by the Special Settlement Master.

25.   All
disagreements in preparation of the formal settlement documents shall be resolved by the Special Settlement Master.

26.   This
MOU may be executed via facsimile transmission and by multiple counterparts, each of which shall be deemed an original and all of which shall constitute one and the
same instrument. All such facsimilied counterparts shall be considered originals and one and the same instrument with the same force and effect as if all such Parties had executed a single copy of
this Agreement.

AGREED
TO ON JUNE 13, 2003:

| |  | MILBERG WEISS BERSHAD
HYNES & LERACH LLP                                    
| |  | ----------------------------------------------------------------------------
| |  | /s/KEITH PARKKeith Park
Lead Counsel for Class Plaintiff                    
| |  | ROBBINS UMEDA & FINK, LLP                                                   
| |  | /s/JEFFREY FINKJeffrey Fink
Counsel for Derivative Plaintiff                
| |  | LANE POWELL SPEARS LUBERSKY LLP                                             
| |  | /s/LARRY S. GANGNESLarry S. Gangnes
Counsel for Defendant Cutter & Buck Inc.
| |  | MCNAUL EBEL NAWROT HELGREN &
VANCE, P.L.L.C.                                
| |  | /s/ROBERT SULKINRobert Sulkin
Counsel for Defendant Harvey N. Jones         
| |  |                                                                             

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| |  | BETTS, PATTERSON & MINES P.S.                                                                                                   
| |  | --------------------------------------------------------------------------------------------------------------------------------
| |  | /s/JAMES NELSONJames Nelson
Counsel for Defendant Martin J. Marks                                                               
| |  | GRAY CARY WARE & FREIDENRICH LLP                                                                                                
| |  | Counsel for Defendant Stephen S. Lowber                                                                                         
| |  | DANIELSON HARRIGAN LEYH & TOLLEFSON                                                                                             
| |  | /s/TIMOTHY LEYHTimothy Leyh
Counsel for Defendants Frances M. Conley, Michael S. Brownfield, Larry C. Mounger and James C. Towne

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