Document:

Exhibit
10.3

 

RECEIVABLES CONTRIBUTION AGREEMENT

 

 

among

 

 

GUESS? IP HOLDER L.P.

 

as IP Holder

 

 

and

 

 

GUESS? ROYALTY FINANCE LLC

 

as the Issuer

 

 

Dated as of April 28, 2003

 

 

TABLE OF
CONTENTS

 

	
  RECITALS

  
	
   

  
	
  ARTICLE I.

  
	
   

  
	
  DEFINITIONS

  
	
   

  
	
  SECTION 1.1

  	
  Definitions

  
	
   

  
	
  ARTICLE II.

  
	
   

  
	
  CONVEYANCE OF ROYALTY
  RECEIVABLES

  
	
   

  
	
  SECTION 2.1

  	
  Conveyance of Royalty Receivables

  
	
  SECTION 2.2

  	
  Absolute Conveyance

  
	
  SECTION 2.3

  	
  Records

  
	
   

  
	
  ARTICLE III.

  
	
   

  
	
  SECURITY
  INTERESTS IN SUBJECT IP AND ROYALTY RECEIVABLES

  
	
   

  
	
  SECTION 3.1

  	
  Subject IP

  
	
  SECTION 3.2

  	
  Filings

  
	
  SECTION 3.3

  	
  Royalty Receivables

  
	
   

  
	
  ARTICLE IV.

  
	
   

  
	
  REPRESENTATIONS AND
  WARRANTIES

  
	
   

  
	
  SECTION 4.1

  	
  IP Holder’s Representations and Warranties

  
	
  SECTION 4.2

  	
  Issuer’s Representations and Warranties

  
	
  SECTION 4.3

  	
  IP Holder’s Representations and Warranties
  as to the Subject License Agreements and the Royalty Receivables

  
	
   

  
	
  ARTICLE V.

  
	
   

  
	
  COVENANTS

  
	
   

  
	
  SECTION 5.1

  	
  IP Holder’s Covenants

  
	
  SECTION 5.2

  	
  Issuer's Covenants

  

 

i

 

	
  ARTICLE VI.

  
	
   

  
	
  FUTURE
  TRANSFERS OF ROYALTY RECEIVABLES

  
	
   

  
	
  SECTION 6.1

  	
  Additional Royalty Receivables

  
	
  SECTION 6.2

  	
  Filings and Further Actions

  
	
   

  
	
  ARTICLE VII.

  
	
   

  
	
  DELIVERY
  OF LLC INTERESTS

  
	
   

  
	
  SECTION 7.1

  	
  Delivery of Limited Liability Company
  Interests

  
	
   

  
	
  ARTICLE VIII.

  
	
   

  
	
  TERMINATION

  
	
   

  
	
  SECTION 8.1

  	
  Termination

  
	
   

  	
   

  
	
  ARTICLE IX.

  
	
   

  
	
  MISCELLANEOUS

  
	
   

  
	
  SECTION 9.1

  	
  Indemnification

  
	
  SECTION 9.2

  	
  Amendment

  
	
  SECTION 9.3

  	
  Relocation of IP Holder

  
	
  SECTION 9.4

  	
  Assignment

  
	
  SECTION 9.5

  	
  Governing Law

  
	
  SECTION 9.6

  	
  Submission To Jurisdiction; Waivers

  
	
  SECTION 9.7

  	
  Notices

  
	
  SECTION 9.8

  	
  Severability of Provisions

  
	
  SECTION 9.9

  	
  Further Assurances

  
	
  SECTION 9.10

  	
  No Waiver; Cumulative Remedies

  
	
  SECTION 9.11

  	
  Counterparts

  
	
  SECTION 9.12

  	
  Third-Party Beneficiaries

  
	
  SECTION 9.13

  	
  Headings

  
	
  SECTION 9.14

  	
  Merger and Integration

  
	
  SECTION 9.15

  	
  Force Majeure

  
	
  SECTION 9.16

  	
  Nonpetition Covenants

  
	
  SECTION 9.17

  	
  Interpretation

  
	
  SECTION 9.18

  	
  Waiver of Jury Trial

  
	
   

  
	
  SCHEDULE A

  	
  Schedule of Subject
  Trademarks

  
	
  SCHEDULE B

  	
  Schedule of Subject
  License Agreements

  
	
  SCHEDULE C

  	
  Schedule of Royalty
  Receivables

  
	
  SCHEDULE D

  	
  Form of Officer’s
  Certificate

  
	
  SCHEDULE E

  	
  Schedule of Core
  Products

  

 

ii

 

This RECEIVABLES CONTRIBUTION AGREEMENT (this
“Receivables Contribution Agreement”) is dated as of April 28, 2003 by and
between Guess? IP Holder L.P., a Delaware limited partnership (“IP Holder”),
and Guess? Royalty Finance LLC, a Delaware limited liability company (the
“Issuer”).

RECITALS

 

WHEREAS, the Issuer desires to purchase all right,
title, and interest in the Royalty Receivables associated with certain Subject
License Agreements owned by IP Holder; and

 

WHEREAS, IP Holder is willing to sell the Royalty
Receivables and pledge the Subject IP to the Issuer;

 

NOW, THEREFORE, in consideration of the premises and
mutual agreements herein contained, each party agrees as follows:

 

ARTICLE
I.

DEFINITIONS

 

SECTION 1.1 Definitions.  Certain capitalized terms used in this
Receivables Contribution Agreement that are not otherwise defined herein shall
have the meanings ascribed to them in Annex X as attached hereto, and the
following terms shall have the respective meanings set forth in this Section
1.1.

 

“Additional
Royalty Receivables” means any additional royalty receivables conveyed by IP
Holder to the Issuer pursuant to Section 6.1(a) or 6.1(b).

 

“Additional
Subject License Agreement” has the meaning set forth in Section 6.1(b).

 

“Additional
Subject Trademarks” means any trademarks licensed under any Additional Subject
License Agreement that are not Subject Trademarks before such Additional
Subject License Agreement is entered, including all Goodwill connected with the
use of, symbolized by, and embodied in such trademarks.

 

“Core Product”
means, in relation to any Subject License Agreement (or successor Additional
Subject License Agreement conveyed to the Issuer pursuant to Section 6.1(c)),
that product category identified on Schedule E.

 

“Receivables
Obligor” means a Person who has licensed any of the Subject Trademarks by the
execution and delivery of a Subject License Agreement, or any other Person who
owes or may be liable for payments under such Subject License Agreement other
than the licensor thereunder.

 

“Royalty
Receivables” means the proceeds of and payments due or to become due by any
Receivables Obligor under each of the Subject License Agreements, including any
Additional Royalty Receivables but not amounts attributable to payments by
Receivables Obligors in respect of items reimbursable to the licensor under the
license agreements in respect of such

 

1

 

items as shared advertising costs, fixturing, signage and oversight and
monitoring of quality of goods produced and trademark usage.

 

“Schedule of Subject License Agreements” means the
schedule of Subject License Agreements attached as Schedule B hereto.

 

“Schedule of Subject Trademarks” means the schedule of
Subject Trademarks attached as Schedule A hereto.

 

“Subject IP” means collectively the Subject License
Agreements and the Subject Trademarks.

 

“Subject License Agreements” means the specific
trademark license agreements, and all proceeds thereof and payments thereunder,
that are identified on Schedule B, including any modifications or extensions
thereof, and any Additional Subject License Agreements, but excluding any
license agreement with respect to which the related Royalty Receivables have
been repurchased by IP Holder from Issuer pursuant to Section 4.3(c) hereof.

 

“Subject
License Agreement File” means, with respect to each Subject License Agreement:

 

(a)                                  the
fully executed original of the Subject License Agreement; and

 

(b)                                 any
and all other documents that IP Holder or the Servicer, as the case may be,
shall keep on file, in accordance with its customary procedures, relating to
such Subject License Agreement or the related Receivables Obligor, including
any samples and other materials provided pursuant to the Subject License
Agreement terms.

 

“Subject
Trademarks” shall mean the specific trademarks and corresponding applications
and registrations therefor that are identified on Schedule A, including any
Additional Subject Trademarks, in either case including all Goodwill connected
with the use of, symbolized by, and embodied in such trademarks.

 

ARTICLE II.

CONVEYANCE OF ROYALTY RECEIVABLES

 

SECTION 2.1 Conveyance of Royalty
Receivables.  Subject to the terms
and conditions of this Receivables Contribution Agreement, IP Holder hereby
contributes, sells, assigns, conveys, and transfers to the Issuer, and the
Issuer hereby acquires from IP Holder (subject to IP Holder’s obligations
hereunder) all right, title, and interest of IP Holder in and to the Royalty
Receivables, and all proceeds with respect to the foregoing.

 

SECTION 2.2 Absolute Conveyance.  It is the intention of the parties that the
contribution contemplated by this Receivables Contribution Agreement shall
constitute an absolute conveyance of the Royalty Receivables from IP Holder to
the Issuer, and the beneficial interest in and title to the Royalty Receivables
shall not be property of IP Holder’s estate in the event of the filing of a
bankruptcy petition by or against IP Holder under any bankruptcy law.

 

2

 

SECTION 2.3 Records.  In connection with the foregoing conveyance,
IP Holder further agrees, at its own expense, (i) to annotate and indicate in
its paper records and/or computer files that the Royalty Receivables have been
transferred to the Issuer pursuant to this Receivables Contribution Agreement,
and (ii) to deliver a schedule containing a true and complete list of all such
Royalty Receivables, which schedule shall be marked as Schedule C to this
Receivables Contribution Agreement and is hereby incorporated into and made a
part of this Receivables Contribution Agreement.

 

ARTICLE
III.

SECURITY
INTERESTS IN SUBJECT IP AND ROYALTY RECEIVABLES

 

SECTION 3.1 Subject
IP.  Subject to the terms and
conditions of this Receivables Contribution Agreement, IP Holder hereby grants
to the Issuer a security interest in the Subject IP to secure the Issuer’s
rights to the Royalty Receivables and IP Holder’s obligations hereunder, and the
Issuer shall have all the rights, powers, and privileges of a secured party
under the UCC; provided that such security interest is expressly subordinated
to the Grant and security interest created by the Guarantee with respect to the
Guarantee Collateral.  This Receivables
Contribution Agreement is and shall be deemed the grant of a security interest
in the Subject IP.

 

SECTION 3.2 Filings.  IP Holder agrees, at its own expense, to
cause all financing statements and continuation statements, this Receivables
Contribution Agreement, all amendments hereto, and any other documents
necessary to provide third parties with notice of the Issuer’s right, title,
and interest to the Subject IP to be promptly recorded, registered, and filed,
and at all times to be kept recorded, registered, and filed, all in such manner
and in such places as may be required by law fully to preserve and protect the
right, title, and interest of the Issuer to the Subject IP; provided that the
foregoing shall be completed and accomplished in a manner consistent with and
intended to preserve the priority of the security interest created by the
Guarantee as being of higher priority than the security interest created hereby
and so perfected.  IP Holder shall
deliver to the Issuer and the Indenture Trustee file-stamped copies of, or
filing receipts for, any document recorded, registered, or filed as provided
above, as soon as available following such recording, registration, or
filing.  The Issuer shall cooperate
fully with IP Holder in connection with the obligations set forth above and
will execute any and all documents reasonably required to fulfill the intent of
this section.

 

SECTION 3.3 Royalty
Receivables.  Although the parties
hereto intend that the transfer and assignment of the Royalty Receivables as
contemplated by Section 2.1 be an absolute conveyance, in the event such
transfer and assignment is deemed to be other than an absolute conveyance, the
parties intend that all filings described in Section 3.2 shall give the Issuer
a perfected security interest in, to, and under the Royalty Receivables and all
proceeds of the foregoing that is prior to any other security interest of any
other party therein other than the security interest created by the Guarantee
and perfected as contemplated in Section 3.2. 
This Receivables Contribution Agreement shall be deemed to be the grant
of a security interest in the Royalty Receivables from IP Holder to the Issuer,
and the Issuer shall have all the rights, powers, and privileges of a secured
party under the UCC.

 

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ARTICLE IV.

REPRESENTATIONS
AND WARRANTIES

 

SECTION 4.1  IP Holder’s Representations and
Warranties.  IP Holder hereby
represents and warrants to the Issuer that:

 

(a)                                  Organization and Good Standing.  IP Holder is duly organized and validly
existing as a limited partnership in good standing under the laws of the State
of Delaware, and has power and authority to own its properties and to conduct
its business as such properties are currently owned and such business is
presently conducted, and has power, authority, and legal right to acquire, own,
and convey the Royalty Receivables.

 

(b)                                 Due Qualification.  IP Holder is duly qualified to do business
as a foreign limited partnership in good standing, and has obtained all
necessary licenses and approvals in all jurisdictions in which the ownership or
lease of property or the conduct of its business requires such qualifications
and where the failure to so qualify would have a Material Adverse Effect.

 

(c)                                  Power
and Authority.  IP Holder has the
power and authority to execute and deliver this Receivables Contribution
Agreement and to carry out its terms; and the execution, delivery, and
performance of this Receivables Contribution Agreement has been duly authorized
by IP Holder by all necessary action.

 

(d)                                 Binding Obligation.  This Receivables Contribution Agreement
constitutes a legal, valid, and binding obligation of IP Holder, enforceable in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium, and other similar laws
affecting creditors’ rights generally, or by general principles of equity.

 

(e)                                  No Violation.  The consummation of the transactions contemplated by this
Receivables Contribution Agreement and the fulfillment of the terms hereof does
not conflict with, result in any breach of any of the terms and provisions of,
nor constitute (with or without notice or lapse of time) a default under, the
certificate of limited partnership or limited partnership agreement of IP
Holder, or conflict with or breach any of the material terms or provisions of,
or constitute (with or without notice or lapse of time) a default under, any
indenture, agreement, or other instrument to which IP Holder is a party or by
which it is bound; nor result in the creation or imposition of any Lien (other
than Permitted Liens) upon any of its properties pursuant to the terms of any
such indenture, agreement or other instrument; nor violate any law or, to the
best of IP Holder’s knowledge, any order, rule, or regulation applicable to IP
Holder of any court or of any federal or state regulatory body, administrative
agency, or other governmental instrumentality having jurisdiction over IP
Holder or its properties; which breach, default, conflict, Lien, or violation
would have a Material Adverse Effect.

 

(f)                                    No Proceedings.  There is no action, suit, or proceeding before or by any court or
governmental agency or body, domestic or foreign, now pending or, to IP
Holder’s knowledge, threatened, against or affecting IP Holder:
(i) asserting the invalidity of this Receivables Contribution Agreement,
(ii) seeking to prevent the consummation of any of the transactions
contemplated by this Receivables Contribution Agreement, or (iii) seeking any
determination or ruling that might materially and adversely affect the
performance by IP Holder

 

4

 

of its obligations under, or the validity or enforceability of, this
Receivables Contribution Agreement.

 

(g)                                 No Consents.  No consent, approval, or order of, or filing with, any court or
governmental body is required to be obtained or made by IP Holder for the
consummation of the transactions in the manner contemplated by this Receivables
Contribution Agreement, except such as have been obtained as of the Closing
Date or such as may be required under state securities laws.

 

(h)                                 Solvency. 
IP Holder is, and immediately after giving effect to the transactions
contemplated by this Receivables Contribution Agreement and the other
Transaction Documents will be, solvent.

 

(i)                                     Taxes. 
IP Holder has filed, or caused to be filed, in a timely manner all tax
returns, reports and declarations that are required to be filed by them or any
of them.  All information in such tax
returns, reports, and declarations is complete and accurate in all material
respects.  IP Holder has paid or caused
to be paid all taxes due and payable or claimed due and payable in any assessment
received by it, except taxes the validity of which are being contested in good
faith by appropriate proceedings diligently pursued and available to IP Holder
and with respect to which adequate reserves have been set aside on its
books.  Adequate provision has been made
for the payment of all accrued and unpaid federal, state, county, local,
foreign, and other taxes whether or not due and payable and whether or not
disputed.

 

(j)                                     Non-Contravention.  The execution, delivery and performance of
this Receivables Contribution Agreement in accordance with its terms and the
consummation of the transactions contemplated hereby by IP Holder do not and
will not (A) require the consent or approval of any Person, except for such
consents and approvals as have already been obtained and (B) violate any applicable
laws.

 

(k)                                  Governmental Regulation.  IP Holder is not required to obtain any
consent, approval, authorization, permit or license from, or effect any filing
or registration with any Governmental Authority in connection with the
execution, delivery and performance of this Receivables Contribution Agreement
in accordance with its terms other than filings intended to perfect the
security interest granted hereunder.

 

(l)                                     State of Organization.  As of the date hereof, IP Holder is
organized under the laws of the State of Delaware.

 

The representations and warranties set forth in this Section 4.1 shall
speak as of the execution and delivery of this Receivables Contribution
Agreement but shall survive the conveyance of the Royalty Receivables by IP
Holder to the Issuer pursuant to this Receivables Contribution Agreement.  Upon discovery by IP Holder or the Issuer
(including by receipt of notice thereby from any other Person with respect
thereto) of a breach of any of the foregoing representations and warranties or
the occurrence of an event that materially and adversely affects the interests
of the Issuer (or any assignee thereof), the party discovering such breach or
event shall give prompt written notice to the other and the Indenture Trustee.

 

5

 

SECTION 4.2  Issuer’s Representations and
Warranties.  The Issuer hereby
represents and warrants to IP Holder that:

 

(a)                                  Organization and Good Standing.  The Issuer is duly organized and validly
existing as a limited liability company in good standing under the laws of the
State of Delaware, and has power and authority to own its properties and to
conduct its business as such properties are currently owned and such business
is presently conducted, and has power, authority, and legal right to acquire
and own the Royalty Receivables.

 

(b)                                 Due Qualification.  The Issuer is duly qualified to do business
as a foreign limited liability company in good standing, and has obtained all
necessary licenses and approvals in all jurisdictions in which the ownership or
lease of property or the conduct of its business requires such qualifications
and where the failure to so qualify would have a Material Adverse Effect.

 

(c)                                  Power and Authority.  The Issuer has the power and authority to
execute and deliver this Receivables Contribution Agreement and to carry out
its terms; and the execution, delivery, and performance of this Receivables
Contribution Agreement has been duly authorized by the Issuer by all necessary
action.

 

(d)                                 Binding Obligation.  This Receivables Contribution Agreement
constitutes a legal, valid, and binding obligation of the Issuer, enforceable
in accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium, and other similar laws
affecting creditors’ rights generally, or by general principles of equity.

 

(e)                                  No Violation.  The consummation of the transactions contemplated by this
Receivables Contribution Agreement and the fulfillment of the terms hereof do
not conflict with, result in any breach of any of the terms and provisions of,
nor constitute (with or without notice or lapse of time) a default under, the
limited liability company agreement of the Issuer, or conflict with or breach
any of the material terms or provisions of, or constitute (with or without
notice or lapse of time) a default under, any indenture, agreement, or other
instrument to which the Issuer is a party or by which it is bound; nor result
in the creation or imposition of any Lien (other than Permitted Liens) upon any
of its properties pursuant to the terms of any such indenture, agreement, or
other instrument; nor violate any law or, to the best of the Issuer’s
knowledge, any order, rule, or regulation applicable to the Issuer of any court
or of any federal or state regulatory body, administrative agency, or other
governmental instrumentality having jurisdiction over the Issuer or its
properties; which breach, default, conflict, lien, or violation would have a
Material Adverse Effect.

 

(f)                                    No Proceedings.  There is no action, suit, or proceeding before or by any court or
governmental agency or body, domestic or foreign, now pending, or to the
Issuer’s knowledge, threatened, against or affecting the Issuer: (i) asserting
the invalidity of this Receivables Contribution Agreement, (ii) seeking to
prevent the consummation of any of the transactions contemplated by this
Receivables Contribution Agreement, or (iii) seeking any determination or
ruling that might materially and adversely effect the performance by the Issuer
of its obligations under, or the validity or enforceability of, this
Receivables Contribution Agreement.

 

6

 

(g)                                 No Consents.  No consent, approval, or order of, or filing with, any court or
governmental body is required to be obtained or made by the Issuer for the
consummation of the transactions in the manner contemplated by this Receivables
Contribution Agreement, except such as have been obtained as of the Closing
Date or such as may be required under state securities laws.

 

(h)                                 Taxes. 
The Issuer has filed, or caused to be filed, in a timely manner all tax
returns, reports and declarations that are required to be filed by them or any
of them.  All information in such tax
returns, reports, and declarations is complete and accurate in all material
respects.  The Issuer has paid or caused
to be paid all taxes due and payable or claimed due and payable in any
assessment received by it, except taxes the validity of which are being
contested in good faith by appropriate proceedings diligently pursued and
available to the Issuer and with respect to which adequate reserves have been
set aside on its books.  Adequate
provision has been made for the payment of all accrued and unpaid federal,
state, county, local, foreign, and other taxes whether or not due and payable
and whether or not disputed.

 

The representations and warranties set forth in this Section 4.2 shall
speak as of the execution and delivery of this Receivables Contribution
Agreement but shall survive the conveyance of the Royalty Receivables by IP
Holder to the Issuer pursuant to this Receivables Contribution Agreement.  Upon discovery by IP Holder or the Issuer
(including by receipt of notice thereby from any other Person with respect
thereto) of a breach of any of the foregoing representations and warranties or
the occurrence of an event that materially and adversely affects the interests
of the Issuer (or any assignee thereof), the party discovering such breach or
event shall give prompt written notice to the other and the Indenture Trustee.

 

SECTION 4.3  IP Holder’s Representations and
Warranties as to the Subject License Agreements and the Royalty Receivables.

 

(a)                                  Representations
and Warranties.  IP Holder hereby
represents and warrants to the Issuer that:

 

(i)                                     Characteristics of Licenses.  Each Subject License Agreement (A) is an
Eligible License Agreement, (B) has been fully and properly executed by the
parties thereto, and (C) contains customary enforceable provisions such that the
rights and remedies of the licensor shall be adequate for IP Holder or its
agent to enforce the Subject License Agreement and protect its ownership and
control over the Subject Trademarks.

 

(ii)                                  Schedule of Licenses.  The information set forth in the Schedule of
Subject License Agreements is true and correct in all material respects.

 

(iii)                               Compliance with Law.  Each of the Subject License Agreements
complies in all material respects with all requirements of applicable federal,
state, and local laws, and regulations thereunder.

 

(iv)                              Binding Obligation.  Each of the Royalty Receivables constitutes
the legal, valid, and binding payment obligation in writing of the related
Receivables Obligor, enforceable by the holder thereof in accordance with its
terms, except as

 

7

 

enforceability may
be limited by bankruptcy, insolvency, reorganization, moratorium, and other
similar laws affecting the enforcement of creditors’ rights in general and by
general principles of equity, regardless of whether such enforceability shall
be considered in a proceeding in equity or at law.

 

(v)                                 No Bankrupt Receivables Obligors.  None of the Royalty Receivables is due, to
the best knowledge of IP Holder, from any Receivables Obligor who is presently
the subject of a bankruptcy proceeding or is insolvent.

 

(vi)                              No Government Receivables Obligors.  None of the Royalty Receivables is due from
the United States or any state, or any foreign government, or from any agency,
department or instrumentality of the United States or any state, local or
foreign government.

 

(vii)                           Subject License Agreements in Force, No Amendments.  None of the Subject License Agreements has
been terminated, rescinded, amended or modified except as is indicated on the attached
Schedule B.

 

(viii)                        No Defenses.  No Licensee under a Subject License Agreement has any right of
rescission, setoff, counterclaim, or defense thereunder, nor has any been
asserted or threatened..

 

(ix)                                Good Title; Liens.  Immediately before the transfer and
assignment of the Royalty Receivables as contemplated by this Receivables
Contribution Agreement, IP Holder will have good and marketable title to each
of the Royalty Receivables free and clear of all Liens (other than Permitted
Liens) and rights of others, and immediately after the transfer and assignment
thereof, the Issuer will have good and marketable title to each of the Royalty
Receivables, free and clear of all Liens (other than Permitted Liens) and
rights of others.  None of the Royalty
Receivables has been sold, transferred, assigned, or pledged by IP Holder to
any Person other than the Issuer.  To
the knowledge of IP Holder, no Liens (other than Permitted Liens) have been
filed by any Persons on the Subject IP or the Royalty Receivables.

 

(x)                                   Perfected Liens.  This Receivables Contribution Agreement creates a valid and
continuing security interest (as defined in the UCC) in the Subject IP in favor
of the Issuer, which security interest is prior to all other Liens (other than
Permitted Liens), and is enforceable as such against creditors of and
purchasers from IP Holder.

 

(xi)                                General Intangibles.  The Subject IP constitutes “general
intangibles” or “payment intangibles” within the meaning of the UCC and/or
marks registered with the United States Patent and Trademark Office in
accordance with 15 U.S.C. et seq.

 

(xii)                             Consents and Approvals.  IP Holder has received all consents to and
approvals of, if any, required by the terms of the Subject License Agreements
to the sale of the Royalty Receivables hereunder to the Issuer.

 

8

 

(xiii)                          All Filings Made.  IP Holder has caused or will have caused the
filing of all appropriate financing statements and other filings (including,
but not limited to, UCC filings (and relevant foreign equivalents) and
trademark filings (with the United States Patent and Trademark Office and
relevant foreign equivalents)) in the proper filing office in the appropriate
jurisdictions under applicable law in order to perfect the security interest in
the Subject IP granted to the Issuer hereunder, or as otherwise necessary in
any jurisdiction to provide third parties with notice of the transfer and
assignment herein contemplated, and to perfect the sale of the Royalty Receivables
from IP Holder to the Issuer and to give the Issuer a perfected security
interest in the Subject IP (including the Royalty Receivables) on the Closing
Date that is prior to all other Liens (other than Permitted Liens), and no
other consent, approval, or order of, or filing with, any court or governmental
body is required to be obtained or made by IP Holder for the consummation of
the transactions in the manner contemplated by this Receivables Contribution
Agreement, except such as have been obtained as of the Closing Date or such as
may be required under state securities laws; provided, however, that if
(A) any filing or trademark filing is not accepted by the relevant governmental
authority or is not effective to provide such notice or to perfect such conveyance,
and (B) such nonacceptance or ineffectiveness would not have a Material Adverse
Effect, then such event will not constitute a breach of this covenant.

 

(xiv)                         Priority. 
Other than the security interest granted to the Issuer pursuant to this
Receivables Contribution Agreement or the other Transaction Documents, IP
Holder has not pledged, assigned, sold, granted a security interest in, or
otherwise conveyed any of the Subject IP. 
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 Subject IP other than any financing statement relating to the security
interest granted to the Issuer hereunder or under the other Transaction
Documents or that has been terminated. 
IP Holder is not aware of any judgment or tax lien filings against IP
Holder.

 

(xv)                            Lawful Assignment.  None of the Royalty Receivables has been
originated in, or is subject to the laws of, any jurisdiction under which the
sale, transfer, and assignment of each of such Royalty Receivables under this
Receivables Contribution Agreement is unlawful, void, or voidable.

 

(xvi)                         Validity. 
The Subject Trademarks are valid, subsisting, enforceable, and have not
been abandoned in any applicable jurisdiction.

 

(xvii)                      No Infringement.  The Subject Trademarks do not violate the trademark rights of any
third party and there is no action or proceeding pending or threatened alleging
that the Subject Trademarks infringe upon the rights of any third party.

 

(xviii)                   No Adverse Judgments.  No domestic or foreign court, tribunal, or
other official governmental authority, including the United States Patent
Trademark

 

9

 

Office and any
foreign equivalent, has entered a holding, judgment, or decision canceling or
otherwise limiting IP Holder’s interest in the Subject IP.

 

(xix)                           No Pending Actions.  No action or proceeding is pending or, to IP
Holder’s knowledge, threatened seeking to limit, cancel, or question the validity
of any material portion of the Subject IP or IP Holder’s ownership interest
therein, or that if adversely determined would have a material adverse impact
on the Subject IP taken as a whole.

 

(xx)                              No Waivers.  None of the Subject License Agreements has been amended or
modified, nor has any provision been waived, in such a manner that any of IP
Holder’s representations and warranties with respect thereto made by IP Holder
herein fails to be true.

 

(xxi)                           No Delinquency.  None of the Royalty Receivables payable under any of the Subject
License Agreements is 30 or more days past due as of the date hereof.

 

(xxii)                        Past Defaults.  No material default has occurred with respect to any of the
Subject License Agreements which has not been cured by the related licensee as
of the date hereof.

 

(xxiii)                     Other Defaults.  The execution and implementation of this Receivables Contribution
Agreement will not result in the breach of any conditions or constitute a
default (with or without notice or lapse of time or both) under any license or
agreement constituting any portion of the Subject  IP or to which any of the Subject IP is subject.  Neither IP Holder nor any person, firm or
corporation associated with or deriving rights in any Subject IP through or
from IP Holder is in default of any applicable agreement constituting a portion
of the Subject IP.

 

(xxiv)                    Advances. 
No advances or other charges heretofore received by IP Holder in
connection with the Subject IP remain recoupable from any Royalty Receivables
by IP Holder on or after the Closing Date, regardless of when advanced or
earned.

 

(xxv)                       Bulk Transfers.  IP Holder’s transfer and assignment of the Subject IP hereunder
is not subject to the provisions of the UCC relating to bulk transfers.

 

(b)                                 The
representations and warranties set forth in this Section 4.3 shall speak as of
the execution and delivery of this Receivables Contribution Agreement, but
shall survive the transfer, conveyance, and assignment of the Royalty
Receivables to Issuer.  Upon discovery
by IP Holder or the Issuer (including by receipt of notice thereby from any
other Person with respect thereto) of a breach of any of the foregoing
representations and warranties or the occurrence of an event that materially
and adversely affects the interests of the Issuer (or any assignee thereof) in
the Subject IP, the party discovering such breach or event shall give prompt
written notice to the other and the Indenture Trustee.

 

(c)                                  IP
Holder hereby agrees that if any Subject License is not an Eligible License
because any of the foregoing representations or warranties is not true as of
the Closing

 

10

 

Date, promptly upon its having knowledge of such breach or receiving
notice from any other Person thereof, IP Holder promptly (but in no less than
ten (10) Business Days) will either (i) cure such breach (if curable), (ii)
purchase from the Issuer all of the Royalty Receivables relating to such
Subject License for the corresponding Repurchase Price (remitted into the Distribution
Account in immediately available funds) or (iii) convey to the Issuer all of
its right, title and interest in to and under the Royalty Receivables relating
to one or more Additional License Agreements that are Eligible License
Agreements and that, in the aggregate, provide for Minimum Royalty Receivables
at least equal in amount to the Minimum Royalty Receivables of such defective
Subject License Agreement, and shall take all necessary and appropriate action
to convey rights to and perfect security interests in favor of the Issuer
hereunder and the Indenture Trustee under the Guarantee in such Additional
Subject License Agreements, Royalty Receivables, related intellectual property
and goodwill and proceeds thereof to the same extent of the respective
interests of such Persons in the Subject IP and Royalty Receivables and related
property intended to be conveyed hereunder and under the Guarantee.  If IP Holder remedies any such breach by
performance pursuant to clause (ii) or clause (iii) of the preceding sentence,
then, without further action by any other Person, the Issuer will reconvey to
IP Holder all of its right, title and interest in to and under the related
defective Subject License Agreement and all Royalty Receivables and proceeds
thereof relating thereto, and shall execute and deliver, and shall cause the
Indenture Trustee to execute and deliver, appropriate agreements,
certifications and filings sufficient to effectuate such reconveyance and the
release of such assets from the Lien of the Indenture.

 

(d)                                 Further,
IP Holder hereby indemnifies and holds harmless the Issuer for any and all
actual costs, expenses, losses, claims, damages, injury, and liabilities
suffered by the Issuer resulting from any infringement contemplated by Section
4.3(a)(xvii) or resulting from any licensee being bankrupt as of the Closing
Date with or without the knowledge of IP Holder.

 

ARTICLE V.

COVENANTS

 

SECTION 5.1 IP Holder’s Covenants.  IP Holder hereby covenants that:

 

(a)                                  Maintenance of Subject IP.  IP Holder will (i) require the Servicer to
service, enforce, police, and otherwise maintain the Subject IP in accordance
with the provisions of the Servicing Agreement, (ii) maintain the quality of
the Subject Trademarks at or above the levels previously maintained by
Trademark Originator except as permitted by Sections 2.02(d) and 6.03(f) of the
Servicing Agreement, and (iii) not enter into any licenses that conflict with
the terms of any exclusive Subject License Agreement.

 

(b)                                 Transaction Documents.  IP Holder will perform all of its
obligations under, and otherwise comply with the terms of with Transaction
Documents, and will notify the Issuer and the Indenture Trustee if it becomes
aware of (i) any material breach under the Transaction Documents by any party thereto,
or (ii) any claimed breach, right of offset, or other material claim made or
brought by any Receivables Obligor.

 

(c)                                  Material Agreements.  IP Holder will not extend, amend, or modify
any Subject License Agreement except in accordance with the Servicing
Agreement.

 

11

 

(d)                                 Events of Default.  IP Holder will notify the Indenture Trustee
in writing if it becomes aware of any Event of Default, Trigger Event or Rapid
Amortization Event.

 

(e)                                  Security Interests.  IP Holder will not sell, pledge, assign, or
transfer to any other Person, or grant, create, incur, assume, or suffer to
exist any Lien (other than Permitted Liens) on the Subject IP (including the
Royalty Receivables), whether now existing or hereafter created, or any
interest therein.  IP Holder will
immediately notify the Issuer of the existence of any Lien (other than
Permitted Liens) on any of the Subject IP (including the Royalty Receivables),
and IP Holder shall defend the right, title, and interest of the Issuer in, to,
and under the Royalty Receivables, whether now existing or hereafter created,
against all claims of third parties claiming through or under IP Holder.

 

(f)                                    Delivery of Payments.  IP Holder will deliver in kind upon receipt
to the Servicer any and all payments received by IP Holder in respect of the
Royalty Receivables as soon as practicable after receipt thereof by IP Holder
from and after the Closing Date.

 

(g)                                 Conveyance of Receivables.  IP Holder will not attempt to convey, assign,
exchange, or otherwise transfer any of the Royalty Receivables to any Person
prior to the termination of this Receivables Contribution Agreement pursuant to
Article VIII hereof.

 

(h)                                 No Change in Business.  IP Holder will not make any changes in the conduct
of its business that would impair the ability to collect the Royalty
Receivables.

 

(i)                                     Special Purpose Entity Status.  IP Holder will take all actions required to
maintain its status as a special purpose entity.

 

(j)                                     Maintenance of Security Interests.  IP Holder will take all actions, including
the making of periodic filings under the UCC, that are required to maintain the
Issuer’s valid and perfected security interest in the Subject IP (including the
Royalty Receivables) as granted under Section 3.1 hereof.

 

(k)                                  No Impairment.  IP Holder will take no action, nor omit to take any action, that
would impair the rights of the Issuer in any of the Royalty Receivables, nor
shall it, except as expressly provided in the Servicing Agreement, reschedule,
revise, offset, or defer payments due on any of the Royalty Receivables.

 

SECTION 5.2 Issuer’s Covenants.  The Issuer hereby covenants that:

 

(a)                                  Transaction Documents.  The Issuer will perform all of its
obligations under and otherwise comply with the terms of the Transaction
Documents, and will notify IP Holder and the Indenture Trustee if it becomes
aware of any breach under the Transaction Documents by any party thereto.

 

(b)                                 No Change in Business.  The Issuer will not make any changes in the
conduct of its business that would impair the ability to collect the Royalty
Receivables.

 

(c)                                  Special Purpose Entity Status.  The Issuer will take all actions required to
maintain its status as a special purpose entity.

 

12

 

(d)                                 Non Disturbance.  The Issuer acknowledges and agrees that all remedial actions
permitted to be taken by the Issuer under this Receivables Contribution
Agreement and the other Transaction Documents are subject to the provisions of Sections
4.02(c) of the Guess? License Agreement, Sections 2.02(d) and 6.03(f) of the
Servicing Agreement, Section 5.6 of the Indenture, Section 5.2(d) of the
Receivables Contribution Agreement, and Section 6.6 of the Guarantee.

 

ARTICLE VI.

FUTURE
TRANSFERS OF ROYALTY RECEIVABLES

 

SECTION 6.1 Additional Royalty Receivables.

 

(a)                                  At
any time and from time to time, IP Holder may elect to convey to the Issuer
additional royalty receivables due and to become due under license agreements
under which IP Holder is the licensor of trademarks owned by IP Holder.

 

(b)                                 IP
Holder agrees that it will convey to the Issuer additional royalty receivables
due and to become due under license agreements that comprise Eligible License
Agreements under which IP Holder is the licensor of trademarks owned by IP
Holder (each an “Additional Subject License Agreement”):

 

(i)                                     if
(A) a Subject License Agreement did not, at the date originally designated as
such, satisfy the requirements of an Eligible License Agreement, or (B) a
Subject License Agreement is cancelled or is terminated for any reason prior to
the last day of the Remaining Term of such license agreement as in effect on
the date such license agreement became a Subject License Agreement (any such
license a “Terminated Subject License”), and, in either case, the Prospective
Coverage Ratio (calculated on a pro forma basis) is less than 107.5%; or

 

(ii)                                  if
such license agreement is entered into after the cancellation or termination in
whole or in part of a Terminated Subject License, and IP Holder grants to the
licensee thereunder a license to use any of the Guess? Trademarks in connection
with the same Core Product that was covered by such Terminated Subject License.

 

In the case of 
license agreements referred to in clause (i) above, IP Holder agrees
that such additional royalty receivables will generate on a prospective basis
Minimum Royalty Receivables that are (i) equal to or greater than the Minimum
Royalty Receivables attributable to the Terminated Subject Licenses, or (ii)
sufficient to cause the Prospective Coverage Ratio (calculated on a pro forma
basis) to be greater than or equal to 107.5%.

 

The agreement contained
in clause (ii) of this Section 6.1(b) imposes no obligation on IP Holder to
enter into any such license agreement, whether or not any Subject License
Agreement is cancelled or terminated. 
If IP Holder chooses to enter into and convey to the Issuer an
Additional Subject License Agreement pursuant to clause (ii) of this Section
6.1(b), IP Holder shall be under no obligation to match the terms (including,
without limitation, the amount of royalties or the territory of the license) of
the Terminated Subject License that such Additional Subject License Agreement
replaces.

 

13

 

(c)                                  IP
Holder agrees that each conveyance of Royalty Receivables pursuant to Section
6.1(b) or Section 4.3(c) shall comply with the following conditions:

 

(i)                                     IP
Holder (or its agent) shall have given the Issuer, the Indenture Trustee and
each Rating Agency written notice specifying the license agreements in respect
of which the additional receivables are being conveyed to the Issuer (such
notice to provide substantially the same information with respect to such
license agreements as is set forth on Schedule B for the Subject License
Agreements as of the Closing Date);

 

(ii)                                  IP
Holder shall have provided a certificate signed by an Authorized Officer of IP
Holder, substantially in the form of Schedule D;

 

(iii)                               If
the license agreement includes Additional Subject Trademarks, IP Holder shall
have given the Issuer, the Indenture Trustee and each Rating Agency a schedule
of such trademarks (such schedule to provide substantially the same information
with respect to such license agreements as is set forth on Schedule A for the
Subject Trademarks as of the Closing Date); and

 

(iv)                              IP
Holder shall have furnished a supplemental conveyance with respect to such
license agreements and, if applicable, the related Additional Subject
Trademarks.

 

Upon satisfaction of the foregoing conditions, the license agreements
specified in the notice referred to in clause (i) above shall become “Subject
License Agreements” hereunder.

 

SECTION 6.2  Filings and Further Actions.  IP Holder agrees to take all actions,
execute all documents, and make all filings (including filings with the United
States Patent and Trademark Office (or any foreign equivalent) or under the
UCC) necessary to effect or reflect any transfers of Additional Royalty
Receivables as provided in Section 6.1, and to perfect the Issuer’s security
interest in any Additional Subject License Agreements and Additional Subject
Trademarks.  In the event the Issuer is
not deemed to be the owner of any Additional Royalty Receivable, the parties
intend that all filings shall be made that are necessary to give the Issuer a
perfected security interest in, to, and under such Additional Royalty
Receivable, and IP Holder hereby agrees to make any and all such filings at its
own expense.  IP Holder further agrees
to take all other actions necessary to grant such a security interest and to
give the Issuer all rights, powers, and privileges of a secured party under the
UCC.

 

ARTICLE
VII.

DELIVERY
OF LLC INTERESTS

 

SECTION 7.1  Delivery of Limited Liability Company
Interests.  The execution of this Receivables
Contribution Agreement and all other Transaction Documents, the completion of
all filings contemplated hereunder and thereunder, and the performance of the
parties’ obligations hereunder and thereunder, shall be concurrent with and
shall be against delivery of the increased capital account balance representing
the limited liability company interests of the Issuer to IP Holder.

 

14

 

ARTICLE VIII.

TERMINATION

 

SECTION 8.1  Termination.  The respective obligations and
responsibilities of IP Holder and the Issuer created by this Receivables
Contribution Agreement shall terminate, except for the indemnity obligations of
IP Holder as provided herein, upon the Termination Date.

 

ARTICLE IX.

MISCELLANEOUS

 

SECTION 9.1 Indemnification.  IP Holder shall indemnify and hold harmless
the Issuer, the Indenture Trustee, and the Noteholders (the “Indemnified
Parties”) from and against any and all costs, expenses, losses, claims,
damages, injury, and liabilities to the extent that such cost, expense, loss,
claim, damage, or liability arose out of, and was imposed upon such Person as a
result of the transactions contemplated by this Receivables Contribution
Agreement through the willful misconduct or gross negligence of IP Holder in
the performance of its duties under this Receivables Contribution Agreement, by
reason of reckless disregard of its obligations and duties under this
Receivables Contribution Agreement, or by breach of its representations and
warranties under this Receivables Contribution Agreement, including, but not
limited to, any judgment, award, settlement, reasonable attorneys’ fees, and
other costs or expenses incurred in connection with the defense of any actual
or threatened action, proceeding, or claim; provided,
however, that IP Holder shall not indemnify any such Person if such
acts, omissions or alleged acts or omissions constitute gross negligence or
willful misconduct by the Issuer, the Indenture Trustee, or any
Noteholders.  In case any such action is
brought against a party indemnified under this Section 9.1 and it notifies IP
Holder of the commencement thereof, IP Holder will assume the defense thereof,
with counsel reasonably satisfactory to such indemnified party (who may be
counsel to IP Holder unless there is an unwaivable conflict of interest as
evidenced by an Opinion of Counsel stating such), and IP Holder will not be
liable to such indemnified party under this section for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof, other than reasonable costs of investigation.  This indemnity is in addition to any other
indemnity from the IP Holder set forth herein.

 

IP Holder will be liable
for settlement of any claim made against any Indemnified Party that is made
with the IP Holder’s written consent, which consent will not be unreasonably
withheld.  The IP Holder will not, with
out the prior written consent of the Indemnified Parties, which consent will
not be unreasonably withheld, settle or compromise any claim, or permit a
default under or consent to the entry of any judgment in respect thereof,
unless such settlement, compromise or consent includes, as an unconditional
term thereof, the giving by the claimant to the applicable Indemnified Party of
an unconditional release from all liability in respect thereof.

 

SECTION 9.2 Amendment.  This Receivables Contribution Agreement may
be amended from time to time by the Issuer and IP Holder only in accordance
with Section 3.13 of the Indenture.

 

SECTION 9.3 Relocation of IP Holder.  Within 30 days after IP Holder makes any
change in (i) its location of organization under Section 9-307(e) of the UCC or
(ii) its name, identity or corporate structure which would make any financing
statement or continuation statement filed in

 

15

 

accordance with Section
3.2 seriously misleading within the meaning of Section 9-507 or 9-508 of the
UCC as in effect in the applicable state, IP Holder shall give the Issuer
notice of any such change and shall execute and file such financing statements
or amendments as may be necessary to continue the perfection of the Issuer’s
security interest in the Receivables and the proceeds thereof.  IP Holder will give the Issuer prompt
written notice of any relocation of any office from which IP Holder keeps
records concerning the Royalty Receivables or of its principal executive office
and whether, as a result of such relocation, the applicable provisions of the
UCC or other applicable law would require the filing of any amendment of any
previously filed financing or continuation statement or of any new financing
statement and shall execute and file such financing statements or amendments as
may be necessary to continue the perfection of the interest of the Issuer in
the Royalty Receivables and the proceeds thereof.

 

SECTION 9.4 Assignment.  This Receivables Contribution Agreement may
not be assigned by the Issuer or IP Holder except as contemplated by this
section, or by the Indenture and the Servicing Agreement; provided, however, that simultaneously
with the execution and delivery of this Receivables Contribution Agreement, the
Issuer shall assign all of its right, title, and interest herein to the
Indenture Trustee for the benefit of the Noteholders pursuant to the
Indenture.  IP Holder agrees to perform
its obligations hereunder for the benefit of the Issuer and agrees that the
Indenture Trustee may enforce the provisions of this Receivables Contribution
Agreement, exercise the rights of the Issuer, and enforce the obligations of IP
Holder hereunder without the consent of the Issuer, subject, without
limitation, to the provisions of Section 5.2(d).

 

SECTION 9.5 Governing Law.  This Receivables Contribution Agreement
shall be governed by, and construed in accordance with, the laws of the State
of New York, and the obligations, rights and remedies of the parties hereunder
shall be determined in accordance with such laws.

 

SECTION 9.6 Submission To Jurisdiction; Waivers.  Each of IP Holder and the Issuer 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 such Person at its address referred
to in Section 9.7 or at such other address as shall be designated by such
Person in a written notice to the other such Persons;

 

(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

 

16

 

(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.

 

SECTION 9.7 Notices.  All demands, notices and communications hereunder shall be in
writing and shall be deemed to have been duly given if personally delivered, or
mailed by registered mail with return receipt requested, to:

 

(a)                                  in
the case of IP Holder, Guess? IP Holder, L.P., 1444 South Alameda Street, Los
Angeles, CA 90021;

 

(b)                                 in
the case of the Issuer, Guess? Royalty Finance LLC, 2222 Glendale Galleria 2,
Glendale, CA 91324; and

 

(c)                                  in
the case of the Indenture Trustee, BNY Midwest Trust Company, 2 North LaSalle
Street, Suite 1020, Chicago, IL 60602;

 

or, as to any of such Persons, at such other address as shall be
designated by such Person in a written notice to the other Persons.

 

SECTION 9.8 Severability of Provisions.  If any one or more of the covenants,
agreements, provisions, or terms of this Receivables Contribution Agreement
shall for any reason whatsoever be held invalid, then such covenants,
agreements, provisions, or terms shall be deemed severable from the remaining
covenants, agreements, provisions, and terms of this Receivables Contribution
Agreement and shall in no way affect the validity or enforceability of the
other provisions of this Receivables Contribution Agreement.

 

SECTION 9.9 Further Assurances.  IP Holder and the Issuer agree to do and
perform, from time to time, any and all acts and to execute any and all further
instruments required or reasonably requested by the other party hereto or by
the Indenture Trustee more fully to effect the purposes of this Receivables
Contribution Agreement, including, without limitation, the execution of any
financing statements, amendments, continuation statements, or releases relating
to the Royalty Receivables for filing under the provisions of the UCC or other
law of any applicable jurisdiction.

 

SECTION 9.10 No Waiver; Cumulative Remedies.  No failure to exercise and no delay in
exercising, on the part of the Issuer, IP Holder, or the Indenture Trustee of
any right, remedy, power, or privilege hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power,
or privilege hereunder preclude any other or further exercise thereof or the exercise
of any other right, remedy, power, or privilege.  The rights, remedies, powers, and privileges herein provided are
cumulative and not exhaustive of any rights, remedies, powers, and privileges
provided by law.

 

SECTION 9.11 Counterparts.  This Receivables Contribution Agreement may
be executed in two or more counterparts (and by different parties on separate
counterparts), each of which shall be an original, but all of which together
shall constitute one and the same instrument.

 

17

 

SECTION 9.12 Third-Party Beneficiaries.  This Receivables Contribution Agreement will
inure to the benefit of and be binding upon the parties signatory hereto, and
the Indenture Trustee for the benefit of any Noteholders, which shall be
considered to be a third-party beneficiary hereof.  Except as otherwise provided in this Receivables Contribution
Agreement, no other Person will have any right or obligation hereunder.

 

SECTION 9.13 Headings.  The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation of
any provision hereof.

 

SECTION 9.14 Merger and Integration.  Except as specifically stated otherwise
herein, this Receivables Contribution Agreement sets forth the entire
understanding of the parties relating to the subject matter hereof, and all
prior understandings, written or oral, are superseded by this Receivables
Contribution Agreement.  This
Receivables Contribution Agreement may not be modified, amended, waived, or
supplemented except as provided herein.

 

SECTION 9.15 Force Majeure.  Neither the IP Holder nor the Issuer shall
be held responsible for any loss, damage, or delay suffered by the other party
owing to any cause that is beyond the reasonable control of the defaulting
party and cannot be attributed to negligence or willful nonperformance of its
obligation. Such causes include, but are not limited to, wars, embargoes,
riots, civil disturbances, terrorism, fires, storms, floods, typhoons,
earthquakes and other natural calamities, strikes and labor disputes,
government acts and restrictions, and other causes that cannot be overcome or
prevented by due diligence. Either party wishing to invoke this section shall
give notice to the other party stating the relevant cause. The defaulting party
shall promptly resume performance of its obligations the moment such cause or
causes cease to operate.

 

SECTION 9.16 Nonpetition Covenants.  Notwithstanding any prior termination of
this Receivables Contribution Agreement, the IP Holder, in its capacity as a
creditor of Issuer, shall not, prior to the date which is one year and one day
after the termination of this Receivables Contribution Agreement with respect
to the Issuer, acquiesce, petition, or otherwise invoke or cause the Issuer to
invoke the process of any court or government authority for the purpose of
commencing or sustaining an involuntary case against the Issuer under any
federal or state bankruptcy, insolvency or similar law, or appointing a
receiver, liquidator, assignee, trustee, custodian, sequestrator, or other
similar official of the Issuer or any substantial part of its property, or
ordering the winding up or liquidation of the affairs of the Issuer.

 

SECTION 9.17 Interpretation.  As applied to this Receivables Contribution
Agreement, unless the context otherwise requires: (a) words in the singular
include the plural, and words in the plural include the singular; (b) reference
to a law, statute, rule, regulation, charter, or bylaws, is deemed to be
followed by “as amended from time to time”; (c) “herein,” “hereof,” and other
similar words refer to this Receivables Contribution Agreement as a whole and
not to any particular section, subsection, paragraph, clause, or other
subdivision; (d)  unless otherwise indicated
or obvious, all references to “Section,” “Exhibit,” “Schedule,” “Appendix,” or
similar words refer to the particular Section in or Exhibit, Schedule,
Appendix, or similar item attached to this Receivables Contribution Agreement;
(e) “include,” “includes,” or “including” will be deemed to be followed, as
appropriate, by “, but not limited to,”; (f) the masculine feminine and neuter
genders shall each be deemed to include the others; (g) “shall,” “will,” or
“agrees” are mandatory, and “may” is permissive; (h) references to “writing”
include printing, typing,

 

18

 

lithography and other
means of reproducing words in a visible form; (i) references to agreements and
other contractual instruments include all subsequent amendments thereto or
changes therein entered into in accordance with their respective terms and not
prohibited by this Receivables Contribution Agreement; and (j) references to
Persons include their permitted successors and assigns.

 

SECTION 9.18  Waiver of Jury Trial.  EACH OF IP HOLDER AND THE ISSUER HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS RECEIVABLES CONTRIBUTION AGREEMENT OR ANY OTHER
TRANSACTION DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

 

[Remainder of the page intentionally left blank]

 

19

 

IN WITNESS WHEREOF, the parties hereto have caused
this Receivables Contribution Agreement to be duly executed by their respective
officers as of the day and year first above written.

 

 

	
   

  	
  GUESS? IP HOLDER
  L.P.,

  
	
   

  	
    as IP
  Holder

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  GUESS? ROYALTY
  FINANCE LLC,

  
	
   

  	
  as Issuer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  
	
   

  	
  ACCEPTED:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BNY MIDWEST
  TRUST COMPANY,

  
	
   

  	
  not
  in its individual capacity 

  but solely as Indenture Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
							

 

S - 1Exhibit 10.4

 

GUESS? LICENSE AGREEMENT

 

between

 

GUESS? IP HOLDER L.P.,

 

and

 

GUESS?, INC.

 

Dated as of April 28, 2003

 

 

TABLE OF CONTENTS

 

	
  I.

  	
  DEFINITIONS

  
	
  II.

  	
  LICENSE
  GRANT

  
	
   

  	
  SECTION
  2.01

  	
  Rights
  Granted

  
	
   

  	
  SECTION
  2.02

  	
  Rights
  Not Granted

  
	
  III.

  	
  QUALITY CONTROL

  
	
   

  	
  SECTION
  3.01

  	
  Quality
  of Guess? Trademarks

  
	
   

  	
  SECTION
  3.02

  	
  Assumption
  of Quality Control Responsibilities by Trademark Originator

  
	
   

  	
  SECTION
  3.03

  	
  Appointment
  of Officials for Quality Control

  
	
   

  	
  SECTION
  3.04

  	
  Modified
  Quality Standards

  
	
   

  	
  SECTION
  3.05

  	
  Quality
  Control of Products

  
	
   

  	
  SECTION
  3.06

  	
  Design
  Standards

  
	
   

  	
  SECTION
  3.07

  	
  Manufacturing
  of Products

  
	
   

  	
  SECTION
  3.08

  	
  Subcontractors
  and Distributors

  
	
   

  	
  SECTION
  3.09

  	
  Style
  Numbers

  
	
   

  	
  SECTION
  3.10

  	
  Right
  to Inspect Facilities

  
	
   

  	
  SECTION
  3.11

  	
  Advertising

  
	
   

  	
  SECTION
  3.12

  	
  Cooperation
  and Reservation of Rights

  
	
  IV.

  	
  OWNERSHIP AND PROTECTION OF GUESS?
  TRADEMARKS

  
	
   

  	
  SECTION
  4.01

  	
  Ownership

  
	
   

  	
  SECTION
  4.02

  	
  Prohibited
  Acts

  
	
  V

  	
  [RESERVED]

  	
   

  
	
  VI.

  	
  COMPENSATION

  
	
   

  	
  SECTION 6.01

  	
  Royalty and Fees

  
	
   

  	
  SECTION 6.02

  	
  Records and Inspection

  
	
   

  	
  SECTION 6.03

  	
  Review of Guess? License Agreement

  
	
  VII.

  	
  TERM AND TERMINATION

  
	
   

  	
  SECTION 7.01

  	
  Term

  
	
   

  	
  SECTION 7.02

  	
  Reorganization of Trademark Originator

  

 

i

 

	
   

  	
  SECTION 7.03

  	
  Termination

  
	
   

  	
   

  	
  (a)     Material
  Breach

  
	
   

  	
   

  	
  (b)     Termination
  at Will

  
	
   

  	
  SECTION 7.04

  	
  Effect of Termination

  
	
  VIII.  

  	
  REPRESENTATIONS AND WARRANTIES

  
	
   

  	
  SECTION 8.01

  	
  Trademark Originator’s Representations and
  Warranties

  
	
   

  	
  SECTION
  8.02

  	
  IP
  Holder’s Representations and Warranties

  
	
  IX.

  	
  MISCELLANEOUS

  
	
   

  	
  SECTION 9.01

  	
  Amendments.

  
	
   

  	
  SECTION 9.02

  	
  Assignment

  
	
   

  	
  SECTION 9.03

  	
  Governing Law; Arbitration

  
	
   

  	
  SECTION 9.04

  	
  Notices

  
	
   

  	
  SECTION 9.05

  	
  Relationship of the Parties

  
	
   

  	
  SECTION 9.06

  	
  Severability of Provisions

  
	
   

  	
  SECTION 9.07

  	
  Further Assurances

  
	
   

  	
  SECTION 9.08

  	
  No Waiver; Cumulative Remedies

  
	
   

  	
  SECTION 9.09

  	
  Counterparts

  
	
   

  	
  SECTION 9.10

  	
  Headings

  
	
   

  	
  SECTION 9.11

  	
  Merger and Integration

  
	
   

  	
  SECTION 9.12

  	
  Force Majeure

  
	
   

  	
  SECTION 9.13

  	
  Nonpetition Covenants

  
	
   

  	
  SECTION 9.14

  	
  Interpretation

  
	
   

  	
   

  	
   

  
				

 

	
  EXHIBIT
  A

  	
  Guess? Trademarks

  

 

ii

 

This GUESS?
LICENSE AGREEMENT (“Guess? License Agreement”) is dated as of April 28, 2003,
by and between Guess? IP Holder L.P., a limited partnership organized under the
laws of the State of Delaware (“IP Holder”), and Guess?, Inc., a corporation organized and existing under the
laws of the State of Delaware (“Trademark Originator”).

 

RECITALS

 

WHEREAS,
Trademark Originator and its subsidiaries have used the Guess? Trademarks as
trade names, as part of their corporate names, and as trademarks for many
years, such use having commenced at least as early as 1981 and having been
continuous and extensive since that time throughout the United States and in
many foreign countries both directly through Trademark Originator and its
subsidiaries and through the licensing of the Guess? Trademarks to selected
licensees;

 

WHEREAS, this
use of the Guess? Trademarks has created public recognition, favorable
reputation, and goodwill associated with and embodied in the Trademarks,
principally in connection with the Business (as defined below);

 

WHEREAS,
pursuant to the Transaction Documents, Trademark Originator has transferred
ownership of the Guess? Trademarks and the goodwill connected with the use of,
symbolized by, and embedded in the Guess? Trademarks to IP Holder; and

 

WHEREAS,
contemporaneously with the execution of the Transaction Documents the parties
wish to grant Trademark Originator and its subsidiaries a right and license to
continue to use the Guess? Trademarks as a trade name, as a part of their
respective corporate names and as a trademark in order to carry on the Business
under the Guess? Trademarks to protect and enhance the Business and the
goodwill symbolized by the Guess? Trademarks for the exclusive benefit of IP
Holder consistent with the public’s expectations of the quality and types of
goods and services marketed under the Guess? Trademarks;

 

NOW,
THEREFORE, in consideration of the mutual covenants and promises herein
provided, the parties hereby agree as follows:

 

AGREEMENT

 

ARTICLE I.

DEFINITIONS

 

SECTION 1.01               Certain
capitalized terms used in this Guess? Licensing Agreement that are not
otherwise defined herein shall have the meanings ascribed to them in Annex X as
attached hereto, and the following terms shall have the respective meanings set
forth in this Section 1.01.

 

“Business”
means Trademark Originator and its subsidiaries’ business activities including,
but not limited to, designing, marketing and distributing, directly and
indirectly, collections of casual apparel, accessories and other related
products, in Trademark Originator’s retail and outlet stores, through a network
of wholesale accounts at selected department stores, over the Internet and
through other related channels.

 

 

“Products” means the casual apparel, accessories and other related
products designed, marketed, distributed and otherwise used in connection with
the Business.

 

“Quality
Standards” has the meaning set forth in Section 3.04.

 

ARTICLE II.

LICENSE GRANT

 

SECTION 2.01               Rights Granted.  Subject to the terms and conditions
contained herein, IP Holder hereby grants to Trademark Originator, and
Trademark Originator hereby accepts, a worldwide, non-exclusive,
sublicenseable, irrevocable right to use the Guess? Trademarks (including all
Goodwill) in connection with the Business for the sole and exclusive benefit of
IP Holder, including, but not limited to, the right to use and to authorize its
subsidiaries to use the Guess? Trademarks as a trade name and as part of
Trademark Originator’s and its subsidiaries respective corporate names and to
use and to authorize its subsidiaries to use the Trademarks as a trademark on
or in connection the Business.  IP
Holder further grants to Trademark Originator all rights necessary to permit
Congress Financial Corporation (“Congress”) to exercise its rights under the
Congress Credit Facility, dated as of August 29, 2002, by and between Congress
and Trademark Originator, and to permit Congress Financial Corporation (Canada)
(“Congress Canada”) to exercise its rights under the Guaranty and Security
Agreement by and between Congress Canada, Trademark Originator, Guess? Retail,
Inc., and Guess.com, Inc., dated as of December 20 2002.  The parties acknowledge that they may
hereafter agree, subject to the terms of the Transaction Documents, to allow
Trademark Originator to grant to specific third parties exclusive licenses to
use one or more Guess? Trademarks.

 

SECTION 2.02               Rights Not Granted.  All rights other than those expressly
granted to Trademark Originator are reserved to IP Holder.  This Guess? License Agreement is not an
assignment or grant to Trademark Originator of any right, title or interest in
or to the Guess? Trademarks other than as described herein.

 

ARTICLE III.

QUALITY CONTROL

 

SECTION 3.01               Quality of Guess? Trademarks.  The parties recognize that the use of the
Guess? Trademarks by Trademark Originator and its subsidiaries over the years
has created a reputation that the Products and related services offered to the
public under the Guess? Trademarks are of the highest quality and that the
reputation and goodwill associated with the Guess? Trademarks extends
throughout the United States and many foreign countries.  The foregoing factors are understood to
require Trademark Originator to conduct and in turn to require each of its
subsidiaries to conduct their business activities using or under the Guess?
Trademarks so as to maintain the high standards of quality that the purchasing
public has come to expect over the years and not to damage the reputation for
quality and the public recognition thereof that has been established in the
Guess? Trademarks.

 

SECTION  3.02              Assumption of Quality Control
Responsibilities by Trademark Originator. 
The parties recognize that Trademark Originator, by virtue of its
relationship to IP

 

2

 

Holder and its numerous years
of experience in conducting the Business under the Guess? Trademarks, has an
interest equal to that of IP Holder in protecting and fostering the good
reputation and public perception of high quality associated with the Guess?
Trademarks; accordingly, Trademark Originator will conduct and direct its
operations and the operations of its subsidiaries in the use of the Guess?
Trademarks as a trade name, as part of a corporate name, as part of a family of
corporations, and as a trademark as to maintain said good reputation and the public
perception of high quality associated with the Guess? Trademarks.  The parties recognize that the burden of
controlling the nature and quality of the goods, services, and business
operations in which Trademark Originator and its subsidiaries use the Guess?
Trademarks is the ultimate responsibility of IP Holder.  The parties have determined that the best
way to perform this obligation, given Trademark Originator’s long and extensive
experience in performing these control functions, and given the unnecessary
cost and impracticality of having IP Holder establish and maintain a
duplicative system and department to control the nature and quality of the
goods and services produced by various licensees of the Guess? Trademarks, is
for Trademark Originator to assume that burden on IP Holder’s behalf and
prevent the Guess? Trademarks from being used on or in connection with goods or
business activities of a nature or quality that could damage the reputation and
goodwill associated with the Guess? Trademarks.  Therefore, Trademark Originator agrees to ensure that the nature
and quality of the Business and any other use of the Guess? Trademarks under
this Guess? License Agreement is conducted with at least the same nature and
quality as such Business or use has been conducted in the past; provided, however, that IP Holder
expressly reserves the right, in its sole discretion, to perform these services
itself or to have another party perform these services in the future.  Trademark Originator agrees not to take any
action in connection with the Guess? Trademarks that it reasonably believes to
be inconsistent with the servicing obligations of the Servicer under the
Servicing  Agreement, and Trademark
Originator further agrees to consult with the Servicer if it is uncertain
whether any contemplated course of action will be inconsistent with such
Servicer obligations.

 

SECTION 3.03               Appointment of Officials for
Quality Control.  The parties
contemplate that Trademark Originator may control the nature and quality of the
goods, services and business of its subsidiaries by appointing or causing the
appointment of the senior officials of these companies and by overseeing the
operations of its subsidiaries to the extent reasonably necessary to maintain
or exceed the above mentioned high standards of quality.

 

SECTION 3.04               Modified Quality Standards.  Notwithstanding the foregoing, IP Holder has
the right, but not the obligation, to promulgate, from time to time, new or
additional rules (and amendments thereto) relating to use of the Guess?
Trademarks (“Quality Standards”).  Any
amendments to the Quality Standards will be effective upon receipt by Trademark
Originator.  Trademark Originator agrees
to comply with and enforce the Quality Standards as in effect at any given
time.  Any action related to the Guess?
Trademarks taken by Trademark Originator that is not prohibited by the Quality
Standards, or otherwise expressly disapproved in writing by IP Holder, shall be
deemed approved by IP Holder, so long as Trademark Originator adheres to the
past standards of quality for use of the Guess? Trademarks and abides by the
usage guidelines for store fixtures and programs as currently in effect and as
may be modified in the future.

 

3

 

SECTION 3.05               Quality Control of Products.  Trademark Originator agrees that Products
designed, marketed, and distributed by Trademark Originator and each of its
subsidiaries shall be of high-quality workmanship and materials, shall be of at
least the same quality as is consistent with past practices, and shall strictly
adhere to any Quality Standards promulgated by IP Holder.

 

SECTION 3.06               Design Standards.  Although Trademark Originator shall perform
quality-control services on IP Holder’s behalf, IP Holder shall have the right,
but not the obligation, to approve or disapprove, upon request and in its
reasonable discretion, all designs of Products proposed to be manufactured by
Trademark Originator or any of its subsidiaries, including styles, materials,
colors, designs, dimensions, styling, details, and fabrication and, upon IP
Holder’s reasonable request, Trademark Originator shall submit to IP Holder
samples of each Product to be manufactured, with the actual fabrics or other
materials to be used for such Product, as well as a packaging and trim board
for each Product.

 

SECTION 3.07               Manufacturing of Products.  Trademark Originator shall be responsible
for supervising and controlling the acts of its own factories and those of its
subsidiaries to prevent the manufacturing or sale of Products that do not meet
the Quality Standards.  Trademark
Originator shall regularly carry out or cause to be carried out quality-control
inspections of the Products manufactured and packaged by its subcontractors,
and shall inform IP Holder as soon as possible of any defects found, and shall
take any and all necessary steps to remedy such defects.  Trademark Originator also shall comply, and
shall ensure its manufacturing subcontractors, as well as those of its
subsidiaries, comply, with past practices for quality of manufacturing, and
with any Quality Standards and other requirements relating to manufacture of
the Products that may be promulgated by IP Holder.

 

SECTION 3.08               Subcontractors and
Distributors.  IP Holder shall have
the right, but not the obligation, to require that Trademark Originator or any
of its subsidiaries terminate its relationship with any subcontractor or
distributor who, in the reasonable discretion of IP Holder, acts in a manner
detrimental to IP Holder or the Guess? Trademarks.  Upon the expiration or termination of any manufacturing agreement
between any such party, Trademark Originator shall cause the subcontractor
immediately to cease the manufacture of Products and fully to perform and
observe its obligations under such manufacturing agreement and this Guess?
License Agreement with respect to such expiration or termination.

 

SECTION 3.09               Style Numbers.  Each Product shall bear the trademarks in
the form established by past practices regarding the Guess? Trademarks or by
any Quality Standards promulgated by IP Holder, including all required legends,
markings and notices.  If Trademark
Originator or any subsidiary purchases labels, tags, or other materials bearing
the Guess? Trademarks from third parties, or produces any such materials itself
or through an affiliate, Trademark Originator shall obligate all providers of
such materials to comply with the past practices for quality of such labels,
tags, or other materials bearing the Guess? Trademarks or to any Quality
Standards promulgated by IP Holder.

 

SECTION 3.10               Right to Inspect Facilities.  Trademark Originator, on behalf of IP
Holder, shall have the right, upon reasonable notice during normal business
hours, to inspect, or to designate a trained designee to inspect, all
facilities utilized by any party, subcontractor and

 

4

 

supplier in connection with the
manufacture, storage or distribution of any Products, and to examine Products
in the process of manufacture, in order to protect the Guess? Trademarks and
ensure the quality of the Products.  In
addition, Trademark Originator shall have the right, on behalf of IP Holder, to
examine any Products held by its customers for resale, upon reasonable notice
during normal business hours, by any party using a Guess? Trademark.  Trademark Originator shall continue to
conduct inspections at distribution and manufacturing centers, including
vendors facilities, in accordance with its current practices.

 

SECTION 3.11               Advertising.  In order to protect the Guess? Trademarks
and the quality and reputation of the Products, Trademark Originator shall at
all times maintain the high standards and consistency of the Guess? Trademarks,
Products and image associated therewith in all advertising, packaging and
promotion of Products and shall have the right, acting on IP Holder’s behalf,
to review any such advertising, and if it determines that any such advertising
is inconsistent with the Quality Standards, shall have the right to require that
the party cease such advertising within a reasonable time.

 

SECTION 3.12               Cooperation and Reservation of
Rights.  IP Holder shall have the
right, but not the obligation, to consult with Trademark Originator’s personnel
and that of its subsidiaries, and the personnel of any of their subcontractors,
suppliers, and other resources to ensure that the Quality Standards are being
met and to monitor Trademark Originator’s efforts under this Guess? License
Agreement in policing and protecting the Guess? Trademarks.  Upon request by IP Holder, Trademark
Originator shall make its personnel, the personnel of its subsidiaries, and (to
the extent reasonably possible) the personnel of any of its subcontractors,
suppliers and other resources, available by appointment during normal business
hours for consultation with IP Holder and its agents or representatives, in
order to ensure quality control of the Products and protection of the Guess?
Trademarks.  In addition, IP Holder expressly
reserves the right, in its discretion, to exercise directly or indirectly any
rights granted to Trademark Originator to perform quality control services at
any time.

 

ARTICLE IV.

OWNERSHIP AND PROTECTION OF GUESS? TRADEMARKS

 

SECTION 4.01               Ownership.  Trademark Originator acknowledges that IP
Holder is the exclusive owner of the Guess? Trademarks, that all direct and
indirect uses of the Guess? Trademarks by Trademark Originator and its
subsidiaries shall inure to the exclusive benefit of IP Holder, and that IP
Holder may license, assign, convey, sell, or otherwise dispose of the Guess?
Trademarks without the consent of Trademark Originator.

 

SECTION 4.02               Prohibited Acts.

 

(a)           In light of the
transfer of the Guess? Trademarks to IP Holder pursuant to the Guess?
Contribution Agreement, Trademark Originator shall not (i) engage in any
activity that may contest, dispute, or otherwise impair the right, title,
interest, or goodwill of IP Holder in the Subject Trademarks, including,
without limitation, any action to prevent or cancel any registration of the
Subject Trademarks, (ii) contest the fact that Trademark Originator’s rights
under this Agreement are solely those of a licensee and will cease upon
termination or expiration of this Guess? License Agreement, (iii) attempt to
register or use any trademark or symbol that is

 

5

 

confusingly similar with in
appearance or commercial impression to the Guess? Trademarks, or that features
or incorporates any portion of the Guess? Trademarks, in its own name or for
its own benefit (provided that Trademark Originator may use the word “Guess” on
its labels to the extent required by law), (iv) take any action, or allow any
licensee to take any action, that would impair the Subject Trademarks or the
enforceability of the Subject License Agreements, or (v) enter into a trademark
license that permits a licensee thereunder to distribute or sell certain
products in certain territories if a Subject License Agreement grants the
Licensee thereunder an exclusive right to distribute or sell the same products
in the same territories.

 

(b)           Trademark Originator
shall not take any action, or allow any licensee to take any action, that would
adversely affect the ability or right of IP Holder to collect the Royalty
Receivables, decrease the amount of the Royalty Receivables, or decrease the
value of the Subject Trademarks if after giving effect to such action, the
Prospective Coverage Ratio (calculated on a pro forma basis) would not be
greater than or equal to 110% or, if the Prospective Coverage Ratio is already
equal to or lesser than 110%, the Prospective Coverage Ratio (calculated on a
pro forma basis) would not be greater than the Prospective Coverage Ratio
before taking such action, or would otherwise reasonably be expected to result
in a Material Adverse Effect.

 

(c)           IP Holder covenants
and agrees that if it transfers any or all of the Guess? Trademarks to a third
party it will (i) take no action that is reasonably likely to invalidate or
constitute an assignment in gross of the Guess? Trademarks, (ii) take no action
that would result in a material breach or impairment of the rights of any
licensee under any license thereof (including this Guess? License Agreement),
and (iii) when the related licenses are not also transferred to such third
party, retain rights to such Guess? Trademarks sufficient to preserve the
rights of all licensees as of the time of such transfer under any license
thereof (including the rights of Trademark Originator under this Guess? License
Agreement).  For the avoidance of doubt,
IP Holder’s cooperation in any foreclosure proceedings instituted by
beneficiaries of the Indenture or the Guarantee are not violations of this
covenant.

 

ARTICLE V.

[RESERVED]

 

ARTICLE VI.

COMPENSATION

 

SECTION 6.01               Royalty
and Fees. 
In consideration of the rights granted to Trademark Originator in this
Guess? License Agreement and the services performed by the Trademark Originator
hereunder, Trademark Originator agrees to pay to IP Holder, for so long as this
Guess? License Agreement shall remain in effect, a royalty equal to*.  Such payments shall be made in United States
currency, and shall be made quarterly within thirty (30) days following the
close of each of Trademark Originator’s fiscal quarters.

 

*
Information for which confidential treatment has been requested pursuant to
Rule 24(b)(2) of the Securities Exchange Act of 1934, as amended.

 

6

 

SECTION 6.02               Records and Inspection.  Trademark Originator shall maintain accurate
records of the royalties paid under this Guess? License Agreement, and upon the
request of IP Holder shall provide copies of such records to the Indenture
Trustee.  At all times during the term
of this Guess? License Agreement and any time following its termination or
expiration, the records maintained by Trademark Originator under this Section
6.02 and all other reports and books of account of Trademark Originator and
each of its subsidiaries with respect to the Business shall be available for
inspection, copying, and audit by IP Holder, its agents and representatives
during normal business hours, upon not less than two Business Days advance
notice, and shall be made by IP Holder at its own expense.

 

SECTION 6.03               Review of Guess? License
Agreement. 
IP Holder shall have the right, but not the obligation, to review this
Guess? License Agreement periodically to determine if royalties being paid
under this Guess? License Agreement are commensurate with income attributable
to use of the Guess? Trademarks.  IP Holder
shall have the right, but not the obligation, to adjust royalties accordingly
upon such review, with Trademark Originator’s written consent, which shall not
be unreasonably withheld.

 

ARTICLE VII.

TERM AND TERMINATION

 

SECTION 7.01               Term.  Unless terminated earlier, this Guess?
License Agreement, including the license granted herein, shall commence on the
date hereof and remain in full force and effect until the Maturity Date, and
thereafter for successive one year periods, unless terminated earlier by the
mutual written consent of the parties or by IP Holder pursuant to its rights in
Sections 7.03 and 7.04 below.

 

SECTION 7.02               Reorganization of Trademark
Originator. 
If any subsidiary of Trademark Originator, other than IP Holder and its
subsidiary, ceases to be a subsidiary, or if IP Holder and Trademark Originator
cease to be “related companies” within the meaning of 15 U.S.C. § 1127 (each a
“Termination Event”), such former subsidiary or Trademark Originator, as the
case may be, shall (i) take immediate steps to change its corporate name to
eliminate any Guess? Trademarks or any colorable simulation thereof, (ii) take
immediate steps to phase out all uses of the Guess? Trademarks or any colorable
simulation thereof as a trade name, trademark, or otherwise, such phase-out to
be complete as soon as possible but in no event more than 180 days after the
date of the Termination Event, and (iii) not use a colorable simulation of any
of the Guess? Trademarks.  In the event
that Trademark Originator and IP Holder cease to be “related companies” within
the meaning of 15 U.S.C. § 1127, Trademark Originator shall, in addition, cause
its subsidiaries to comply with the provisions of the preceding sentence.

 

SECTION 7.03               Termination.

 

(a)           Material Breach.  Upon a Material Breach, as hereinafter
defined, by Trademark Originator of this Guess? License Agreement, IP Holder
shall have the right to terminate this Guess? License Agreement, provided that
IP Holder first gives written notice of such breach (other than with respect to
clause (1) or (6) below) to Trademark Originator and (other than with respect
to clause (6) below) gives Trademark Originator thirty (30) days to cure or to
take effective steps to cure the breach (unless such breach cannot be cured
within a 30-day

 

7

 

period and Trademark Originator
shall have commenced to cure such breach and cures it within any additional
30-day period; provided, that
this additional 30-day period will not apply in the case of clause (1)
below).  Material Breach shall include
Trademark Originator’s:

 

(1)                                  failure
to make any payments under this Guess? License Agreement;

(2)                                  breach
of its representations and warranties under Section 8.01 hereof;

(3)                                  breach
of its covenants under Section 4.02(a) hereof;

(4)                                  failure
to fulfill any of its other obligations under this Guess? License Agreement,
including, but not limited to, Trademark Originator’s quality control
obligations;

(5)                                  permitting
any of its subsidiaries to commit what would be a material breach if committed
by Trademark Originator; or

(6)                                  filing a petition for
relief under applicable bankruptcy law, or the filing of such a petition
against Trademark Originator, if not discharged within sixty (60) days after
the date of filing; or making any assignment for the benefit of creditors; or
becoming the subject of proceedings under any insolvency, reorganization or
receivership law; or having a receiver appointed for Trademark Originator or a
substantial part of its business.

 

Upon or before expiration of any sixty (60) or thirty (30) day period
to cure, as applicable, Trademark Originator shall inform IP Holder in writing
of any cure or any steps it has taken to cure the Material Breach.  If, in IP Holder’s sole discretion, such
steps are not effective to cure the Material Breach, IP Holder may immediately
terminate this Guess? License Agreement and all rights of Trademark Originator
and its subsidiaries.

 

(b)           Termination at Will.  At any time from and after the Maturity
Date, IP Holder also shall have the right to terminate this Guess? License
Agreement upon sixty (60) days prior notice to Trademark Originator.

 

SECTION 7.04               Effect of Termination.  Upon termination or expiration of this
Guess? License Agreement, whether pursuant to Section 7.03 hereof or otherwise,
Trademark Originator agrees promptly to comply with and to cause its
subsidiaries promptly to comply with the provisions of Section 7.02 hereof,
provided that any phase-out be complete as soon as possible but in no event more
than six (6) months after the effective date of termination.  Trademark Originator shall also promptly
return to IP Holder all materials that bear the Guess? Trademarks or destroy
such materials and certify their destruction to IP Holder.

 

ARTICLE VIII.

REPRESENTATIONS AND WARRANTIES

 

SECTION 8.01               Trademark Originator’s
Representations and Warranties.  Trademark Originator hereby represents and
warrants that:

 

(a)           It is a corporation
duly organized and validly existing in good standing under the laws of the
State of Delaware, and has power and authority to own its properties and to
conduct its business as such properties are currently owned and such business
is presently conducted.

 

8

 

(b)           It is duly qualified
to do business as a foreign corporation in good standing, and has obtained all
necessary licenses and approvals in all jurisdictions in which the ownership or
lease of property or the conduct of its business requires such qualifications
and where the failure to so qualify would have a Material Adverse Effect.

 

(c)           It has the corporate
power and authority to execute and deliver this Guess? License Agreement and to
carry out its terms; and the execution, delivery and performance of this Guess?
License Agreement has been duly authorized by Trademark Originator by all
necessary corporate action.

 

(d)           This Guess? License
Agreement constitutes a legal, valid, and binding obligation of Trademark
Originator, enforceable in accordance with its terms, except as enforceability
may be limited by bankruptcy, insolvency, reorganization, moratorium, and other
similar laws affecting creditors’ rights generally, or by general principles of
equity.

 

(e)           The consummation of
the transactions contemplated by this Guess? License Agreement and the
fulfillment of the terms hereof do not conflict with, result in any breach of
any of the terms and provisions of, nor constitute (with or without notice or
lapse of time) a default under, the articles of incorporation or bylaws of
Trademark Originator, or conflict with or breach any of the material terms or
provisions of, or constitute (with or without notice or lapse of time) a
default under, any indenture, agreement, or other instrument to which Trademark
Originator is a party or by which it is bound; nor result in the creation or
imposition of any Lien (other than Permitted Liens) upon any of its properties
pursuant to the terms of any such indenture, agreement, or other instrument;
nor violate any law or, to the best of Trademark Originator’s knowledge, any
order, rule, or regulation applicable to Trademark Originator of any court or
of any federal, state, or foreign regulatory body, administrative agency, or
other governmental instrumentality having jurisdiction over Trademark Originator
or its properties, which breach, default, conflict, lien, or violation would
have a Material Adverse Effect.

 

(f)            There is no action,
suit, or proceeding before or by any court or governmental agency or body,
domestic or foreign, now pending or, to Trademark Originator’s knowledge,
threatened, against or affecting Trademark Originator: (i) asserting the
invalidity of this Guess? License Agreement, (ii) seeking to prevent the
consummation of any of the transactions contemplated by this Guess? License
Agreement, or (iii) seeking any determination or ruling that might materially
and adversely affect the performance by Trademark Originator of its obligations
under, or the validity or enforceability of, this Guess? License Agreement.

 

(g)           No consent,
approval, or order of, or filing with, any court or governmental body is
required to be obtained or made by Trademark Originator for the consummation of
the transactions in the manner contemplated by this Guess? License Agreement,
except such as have been obtained as of the Closing Date or such as may be
required under state securities laws.

 

(h)           The execution,
delivery and performance of this Guess? License Agreement in accordance with
its terms and the consummation of the transactions contemplated hereby by
Trademark Originator do not and will not (i) require the consent or approval of
any

 

9

 

Person, except for such
consents and approvals as have already been obtained and (ii) violate any
applicable laws.

 

(i)            Trademark
Originator is not required to obtain any consent, approval, authorization,
permit or license from, or effect any filing or registration with any
Governmental Authority in connection with the execution, delivery and
performance of this Guess? License Agreement in accordance with its terms other
than filings intended to perfect the security interest granted hereunder.

 

(j)            As of the date
hereof, Trademark Originator is incorporated under the laws of the State of
Delaware.

 

SECTION 8.02               IP Holder’s Representations
and Warranties.  IP Holder hereby
represents and warrants that:

 

(a)           It is a limited
partnership duly organized and validly existing in good standing under the laws
of the State of Delaware.

 

(b)           It has the ability
and capacity to perform its obligations hereunder, and those obligations do not
conflict with any other obligations of IP Holder.

 

ARTICLE IX.

MISCELLANEOUS

 

SECTION 9.01               Amendments.  This Guess? License Agreement may be amended
by mutual written consent of the parties hereto; provided that, as a condition
of effectiveness of any such amendment, (i) an authorized officer of Trademark
Originator shall have delivered to the Indenture Trustee a copy of such
amendment together with a certificate, to the effect that such amendment could
not reasonably be expected to have a Material Adverse Effect, and (ii) the
Rating Agency Condition is satisfied with respect thereto.

 

SECTION 9.02               Assignment.  Unless Guarantee
Collateral is foreclosed upon, liquidated or sold pursuant to the Guarantee,
this Guess? License Agreement may not be assigned without the prior written
consent of the other party except in connection with a merger, consolidation,
reorganization, or similar transaction.

 

SECTION 9.03               Governing Law; Arbitration.
 All questions
concerning this Guess? License Agreement, the rights and obligations of the
parties, enforcement and validity, effect, interpretation and construction that
are governed by state law shall be determined under the laws of the State of
California.  United States federal law
shall apply to all other issues.  Except
as otherwise provided in this Guess? License Agreement, the parties consent and
submit to the exclusive jurisdiction and venue of the State of California, for
the adjudication of any dispute pertaining to this Guess? License Agreement or
the alleged breach of any provision hereof. 
Except as provided in this Guess? License Agreement, any dispute,
controversy, or claim arising out of or relating to this Guess? License Agreement
or breach thereof shall be settled by binding arbitration heard by one (1)
arbitrator, in accordance with the Commercial Arbitration Rules (“Rules”) of
the American Arbitration Association. 
The arbitrator shall be appointed in

 

10

 

accordance with the Rules.  The parties hereto agree that the venue of
such arbitration shall be the City of Los Angeles, Los Angeles County,
California.

 

SECTION 9.04               Notices.  All demands, notices and communications
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered at or mailed by registered mail, return receipt requested,
to:

 

(a)           in the case of
Trademark Originator, 1444 South Alameda Street, Los Angeles, CA 90021;

 

(b)           in the case of IP
Holder, 1444 South Alameda Street, Los Angeles, CA 90021;

 

(c)           in the case of the
Issuer, Guess? Royalty Finance LLC, 2222 Glendale Galleria 2, Glendale, CA
91324; and

 

(d)           in the case of the
Indenture Trustee, 2 North LaSalle Street, Suite 1020, Chicago, IL 60602;

 

or, as to any of such Persons, at such other address as shall be
designated by such Person in a written notice to the other Persons.

 

SECTION 9.05               Relationship of the Parties.  Except as otherwise specifically provided herein,
this Guess? License Agreement shall not be construed to place the parties in
the relationship of legal representatives, partners, joint venturers, or agents
of or with each other.  Under this
Guess? License Agreement, Trademark Originator is an independent contractor and
shall be solely responsible for the payment of all income tax withholding,
payroll taxes, contributions and other obligations relating to Trademark
Originator’s employment and compensation of its employees and consultants.  No party shall have any power to obligate or
bind any other party in any manner whatsoever, except as specifically provided
herein.

 

SECTION 9.06               Severability of Provisions.
 If any one or
more of the covenants, agreements, provisions or terms of this Guess? License
Agreement shall for any reason whatsoever be held invalid, then such covenants,
agreements, provisions or terms shall be deemed severable from the remaining
covenants, agreements, provisions and terms of this Guess? License Agreement
and shall in no way affect the validity or enforceability of the other provisions
of this Guess? License Agreement.

 

SECTION 9.07               Further Assurances.  Trademark Originator and IP Holder agree to
do and perform, from time to time, any and all acts and to execute any and all
further instruments required or reasonably requested by the other party hereto
or by the Issuer more fully to effect the purposes of this Guess? License
Agreement.

 

SECTION 9.08               No Waiver; Cumulative Remedies.  No failure to exercise and no delay in
exercising, on the part of IP Holder, the Issuer, the Indenture Trustee or
Trademark Originator, of any right, remedy, power, or privilege hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power,

 

11

 

or privilege.  The rights, remedies, powers, and privileges
herein provided are cumulative and not exhaustive of any rights, remedies,
powers and privileges provided by law.

 

SECTION 9.09               Counterparts.  This Guess? License Agreement may be executed
in two or more counterparts (and by different parties on separate
counterparts), each of which shall be an original, but all of which together
shall constitute one and the same instrument.

 

SECTION 9.10               Headings.  The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation of
any provision hereof.

 

SECTION 9.11               Merger and Integration.  Except as specifically stated otherwise
herein, this Guess? License Agreement sets forth the entire understanding of
the parties relating to the subject matter hereof, and all prior
understandings, written or oral, are superseded by this Guess? License
Agreement.  This Guess? License
Agreement may not be modified, amended, waived or supplemented except as
provided herein.

 

SECTION 9.12               Force Majeure.  Neither IP Holder nor Trademark Originator
shall be held responsible for any loss, damage, or delay suffered by the other
party owing to any cause that is beyond the reasonable control of the
defaulting party and cannot be attributed to negligence or willful
nonperformance of its obligation. Such causes include, but are not limited to,
wars, embargoes, riots, civil disturbances, terrorism, fires, storms, floods,
typhoons, earthquakes and other natural calamities, strikes and labor disputes,
government acts and restrictions, and other causes that cannot be overcome or
prevented by due diligence. Either party wishing to invoke this section shall
give notice to the other party stating the relevant cause. The defaulting party
shall promptly resume performance of its obligations the moment such cause or
causes cease to operate.

 

SECTION 9.13               Nonpetition Covenants.  Notwithstanding any prior termination of
this Guess? License Agreement, Trademark Originator shall not, prior to the
date which is one year and one day after the Termination Date with respect to
IP Holder or the Issuer, acquiesce, petition, or otherwise invoke or cause IP
Holder or the Issuer to invoke the process of any court or government authority
for the purpose of commencing or sustaining a case against IP Holder or the
Issuer under any federal or state bankruptcy, insolvency or similar law, or
appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator,
or other similar official of IP Holder or the Issuer or any substantial part of
its property, or ordering the winding up or liquidation of the affairs of IP
Holder or the Issuer.

 

SECTION 9.14               Interpretation.  As applied to this Guess? License Agreement,
unless the context otherwise requires: 
(a) words in the singular include the plural, and words in the plural
include the singular; (b) reference to a law, statute, rule, regulation,
charter, or bylaws, is deemed to be followed by as amended “from time to time”;
(c) “herein,” “hereof,” and other similar words refer to this Guess? License
Agreement as a whole and not to any particular section, subsection, paragraph,
clause, or other subdivision; (d)  unless
otherwise indicated or obvious, all references to “Section,” “Exhibit,”
“Schedule,” “Appendix,” or similar words refer to the particular Section in or
Exhibit, Schedule, Appendix, or similar item attached to this Guess? License
Agreement; (e) “include,” “includes,” or “including” will be deemed to be
followed, as appropriate, by “, but not limited to,”; (f) the masculine
feminine and neuter genders

 

12

 

shall each be deemed to include
the others; (g) “shall,” “will,” or “agrees” are mandatory, and “may” is
permissive; (h) references to “writing” include printing, typing, lithography
and other means of reproducing words in a visible form; (i) references to
agreements and other contractual instruments include all subsequent amendments
thereto or changes therein entered into in accordance with their respective
terms and not prohibited by this Guess? License Agreement; and (j) references
to Persons include their permitted successors and assigns.

 

[Remainder of
page intentionally left blank]

 

13

 

IN WITNESS
WHEREOF, the parties hereto have entered this Guess? License Agreement as of
the date first written above.

 

	
  GUESS ? IP HOLDER L.P.

  	
  GUESS ?, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
  Name:

  
	
  Title:

  	
  Title:

  
					

 

S - 1

 

EXHIBIT
A

Guess?
Trademarks

 

A - 1

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