Document:

SUBORDINATION
AGREEMENT OF FOSSIL TRUST FOR

THE BENEFIT OF FIRST INTERSTATE BANK OF TEXAS,

N.A.

 

WHEREAS,     Fossil
Partners, L.P. (“Borrower”) is or may become indebted to Fossil Trust, a
Delaware business trust (“Junior Creditor”)

 

WHEREAS, Borrower desires
to enter into an Amended and Restated Loan Agreement (the “Loan -Agreement”)
with First Interstate Bank of Texas, N.A. (“Bank”); and

 

WHEREAS, upon Bank’s
acceptance of this Subordination Agreement, Borrower will be indebted to Junior
Creditor only in the amounts and on the evidences of indebtedness described on
Exhibit A attached hereto;

 

NOW, THEREFORE, to induce Bank, in its discretion, to extend
credit to Borrower at any time, in such manner, upon such terms and for such
amounts as may be mutually agreeable to Bank and Borrower, Junior Creditor
hereby agrees to subordinate and does hereby subordinate payment by Borrower of
all or any part of the indebtedness described on Exhibit A attached hereto together
with any and all other indebtedness of Borrower to Junior Creditor now or
hereafter incurred, created or evidenced, howsoever such indebtedness may be hereafter
extended, renewed or evidenced (all such indebtedness hereinafter referred to
as the “Subordinated Indebtedness”), together with all collateral, mortgage(s)
and security if any, for the payment of the Subordinated Indebtedness, to the
payment in full, in cash to Bank, its successors and assigns, of any and all
indebtedness, direct or contingent for which Borrower may now or hereafter be obligated
to Bank, including, without limitation, interest at the rate(s) provided for in
the Loan Agreement which, but for the commencement of any bankruptcy,
insolvency or receivership proceeding relating to Borrower, would have accrued
and been payable with respect to such indebtedness, (“Senior Obligations”) and
any collateral, mortgage(s) and security granted to Bank therefor, and in
furtherance thereof does hereby agree not to ask for, demand, sue for, take or
receive all or any part of the Subordinated Indebtedness or enforce Junior
Creditor’s rights to any security therefor, nor ask for, demand, take or
receive any security therefor, unless and until Senior Obligations have been
paid in full in cash and Bank’s financing arrangements with Borrower terminated.
Junior Creditor also hereby agrees that Bank shall be subrogated for Junior
Creditor with respect to Junior Creditor’s claims against Borrower and Junior
Creditor’s rights, liens and security interests, if any, in any of Borrower’s assets
and the proceeds thereof until the Senior Obligations have been paid in full,
in cash and Bank’s financing arrangements with Borrower terminated.

 

Junior Creditor further agrees that, upon any distribution
of the assets or readjustment of the indebtedness of Borrower, whether by
reason of liquidation, composition, bankruptcy, arrangement, receivership,
assignment for the benefit of creditors or any other action or proceeding involving
the readjustment of all or any of the Subordinated Indebtedness, or the
application of the assets of Borrower to the payment or liquidation thereof,
Bank shall be entitled to receive payment in full in cash of the Senior
Obligations prior the payment of all or any part of the Subordinated Indebtedness,
and in order to enable Bank to enforce its rights hereunder in any such action or
proceeding, Bank is hereby irrevocalby authorized and empowered in its sole discretion
make and present for and on behalf of Junior Creditor such proofs of claim
against Borrower on account of the Subordinated Indebtedness in the name of
Junior Creditor or Bank may deem expedient or proper and to vote such proofs of
claim in any such proceeding and to receive and collect any and all dividends or
other payments or disbursements made thereon in whatever form the same may be paid
and issued and to apply the same on account of any of the Senior Obligations.

 

 

Junior Creditor
represents and warrants to Bank that Exhibit A attached hereto identifies all
of Borrower’s existing indebtedness and obligations to Junior Creditor.

 

Junior Creditor further agrees to execute and deliver
to Bank such assignments, endorsements, or other instruments as my be required
by Bank in order to enable Bank to enforce any and all such claims and to
collect any and all dividends or other payments or disbursements which may be
made at any time on account of all or any of the Subordinated Indebtedness.

 

If any money or other
property is received by Junior Creditor for application on the Subordinated
Indebtedness before the Senior Obligations are paid in full, in cash, Junior
Creditor will hold such money and other property in trust for Bank and promptly
after receipt, deliver such money and other property to Bank.

 

Junior Creditor hereby also agrees not to assign or transfer
at any time while this Subordination Agreement remains in effect any rights,
claim or interest of any kind in or to any of the Subordinated Indebtedness,
either principal or interest, without (1) first notifying Bank and (2) making such
assignment expressly subject to this Subordination Agreement in form and
substance satisfactory to Bank. Junior Creditor will, upon request from Bank, deliver
any note or other evidence of the Subordinated Indebtedness to Bank, and Bank
may (or Junior Creditor, upon request from Bank, will) add a legend to such
note or other evidence of the Subordinated Indebtedness stating that payment
thereof is the subject of the provisions of this Subordination Agreement.

 

This is a continuing
agreement of subordination and Bank may continue, without notice to Junior
Creditor, to extend credit or other accommodation or benefit and lend moneys to
or for the account of Borrower on the faith hereof. It is further understood
and agreed that Bank may at any time, in its sole discretion, renew or extend
the time of payment of all or any existing or future indebtedness or
obligations of Borrower to Bank or waive or release any collateral which may be
held therefor at any time and in reference thereto to make and enter into any
such agreement or agreements as Bank may deem proper or desirable without
notice to or further assent from Junior Creditor and without in any manner
impairing or affecting this Subordination Agreement or any of Bank’s rights
hereunder.

 

Junior Creditor hereby expressly
waives notice of acceptance by Bank of the subordination and other provisions of
this Subordination Agreement and all other notices whatsoever, including,
without limitation, notice of the creation of any indebtedness or liability of
Borrower to Bank, notice of the giving or extension of credit by Bank to Borrower,
notice of protest and default, and all other notices to which Junior Creditor
might otherwise be entitled. Junior Creditor consents and agrees that Bank
shall be under no obligation to marshal any assets in favor of Junior Creditor or
against or in payment of any or all of the Senior Obligations. Junior Creditor
hereby assents to any extension or postponement of the time of payment of the
Senior Obligations or to any other indulgence with respect thereto, to any
substitution, exchange or release of collateral which may at any time secure
the Senior Obligations and/or to the addition or release of any other party or
person primarily or secondarily liable therefor.

 

Junior Creditor expressly
waives reliance by Bank upon the subordination and other agreements as herein
provided and presentment, demand and protest. Junior Creditor agrees that Bank
has made no warranties or representations with respect to the due execution,
legality, validity, completeness or enforceability of the Loan Agreement or any
other document or instrument evidencing or relating to the Senior Obligations, or
the collectibility of the Senior Obligations, that Bank shall be entitled to
manage and supervise its loans to Borrower in accordance with its usual practices,
modified from time to time as it deems appropriate under the circumstances,
without regard to the existence of any rights that Junior Creditor may now or
hereafter have in or to any of the assets of Borrower, and that Bank shall have
no liability to Junior Creditor for, and waives any claim which Junior Creditor
may now or hereafter have

 

 

against Bank arising out of, (1) any and all actions which Bank, in
good faith, takes or omits to take (including, without limitation, actions with
respect to the creation, perfection or continuation of liens or security interests
in the “Collateral” (as defined in the Loan Agreement), actions with respect to
the occurrence of an “Event of Default” (as defined in the Loan Agreement), actions
with respect to the foreclosure upon, sale, release of, depreciation of or
failure to realize upon any of the Collateral, and actions with respect to the
collection of any claim for all or any part of the Senior Obligations from any account
debtor, guarantor or any other party) with respect to the Loan Agreement or any
other agreement related thereto or to the collection of the Senior Obligations
or the valuation, use, protection or release of the Collateral, (2) Bank’s
election, in any proceeding instituted under Chapter 11 of Title 11 of the
United States Code (11 U.S.C. §101 et seq.) (the “Bankruptcy Code”), of the application
of Section 1111(b)(2) of the Bankruptcy Code, and/or (3) any borrowing or grant
of a security interest under Section 364 of the Bankruptcy Code.

 

Junior Creditor hereby
assumes responsibility for keeping itself informed of the financial condition
of Borrower, any and all endorsers and any and all guarantors of Borrower’s indebtedness
to Bank and of all other circumstances bearing upon the risk of nonpayment of
the Subordinated Indebtedness that diligent inquiry would reveal, and Junior
Creditor hereby agrees that Bank shall have no duty to advise Junior Creditor
information known to Bank regarding such condition or any such circumstances.

 

This Subordination
Agreement is binding on Junior Creditor, its successors and assigns, and shall
inure to the benefit of Bank, its successors and assigns. Whenever reference is
made in this Subordination Agreement to Borrower, such term shall include any
successor or assign of Borrower, including, without limitation, a receiver,
trustee or deptor-in-possession.

 

The foregoing notwithstanding, until such time as Bank
gives Junior Creditor notice that Borrower is in default of any of its obligations
to Bank, Junior Creditor may accept and retain payments identified on Exhibit A
attached hereto as “Permitted Payments”.

 

Any notice or notification required, permitted or contemplated
hereunder shall be in writing, shall be addressed to the party to be notified
at the address set forth below or at such other address as each party may
designate for itself from time to time by notice hereunder, and shall be deemed
to have been validly served, given or delivered (i) three (3) days following
deposit in the United States mails, with proper first class postage prepaid,
certified mail, return receipt requested (ii)  the next Business Day after such notice was delivered
to a regularly scheduled overnight delivery carrier with delivery fees either prepaid
or an arrangement, satisfactory with such carrier, made for the payment of such
fees, or (iii) upon receipt of notice given by telecopy, mail-gram, telegram,
telex, or personal delivery:

 

	
   

  	
  To Bank:

  	
  First        Interstate Bank of Texas, N.A

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  1445 Ross Avenue Suite
  300

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Dallas, Texas 75202
  Attn: Jeffrey S. A. Cook

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  To Junior Creditor:

  	
  Fossil Trust

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  1100 N. Market Street

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Rodney Square North

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Wilmington, Delaware
  19890

  

 

 

	
   

  	
  With a copy to:

  	
  Fossil Trust c/o
  Fossil, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  2280 N. Greenville
  Avenue

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Richardson, Texas
  75082-4412

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Randy S.
  Kercho

  

 

THIS SUBORDINATION AGREEMENT SHALL BE INTERPRETED AND
THE RIGHTS AND LIABILITIES OF THE PARTIES HERETO DETERMINED IN ACCORDANCE WITH
THE LOCAL LAW OF THE STATE OF TEXAS, EXCLUDING ANY CONFLICTS OF LAW RULE OR
PRINCIPLE THAT MIGHT OTHERWISE REFER CONSTRUCTION OR INTERPRETATION OF THIS
SUBORDINATION AGREEMENT TO THE SUBSTANTIVE LAW OF ANOTHER JURISDICTION, AND ALL
OTHER LAWS OF MANDATORY APPLICATION.

 

BANK AND JUNIOR CREDITOR EACH HEREBY WAIVES TRIAL BY
JURY WITH RESPECT TO ANY ACTION, CLAIM, SUIT OR PROCEEDING IN RESPECT TO ARISING
OUT OF THIS AGREEMENT AND/OR THE CONDUCT OF THE RELATIONSHIP BETWEEN BANK AND
JUNIOR CREDITOR.

 

This Subordination Agreement sets forth the complete undertaking
and agreements of Bank and Junior Creditor with the subject matter hereof, and
there are no other agreements or understandings binding upon them, including, without
limitation, any conflicting provisions of any agreement of note referred to on
Exhibit A attached hereto.

 

The parties agree to be bound by the terms and
provisions of the Arbitration Program (dated 9/1/92) which is incorporated by
reference herein and is acknowledged as received by the parties pursuant to
which any and all disputes shall be resolved by mandatory binding arbitration
upon the request of any party.

 

IN WITNESS WHEREOF, this
Subordination Agreement has been duly executed by Junior Creditor as of August
31, 1994,

 

	
   

  	
  FOSSIL TRUST,

  
	
   

  	
   

  
	
   

  	
  a Delaware business
  trust

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Alan D. Moore

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   Alan D. Moore, Trustee

  	
   

  

 

 

ACKNOWLEDGEMENT BY
BORROWER

 

Borrower hereby acknowledges receipt of a copy of the
Subordination Agreement, confirms the accuracy of the information set forth in
Exhibit A attached hereto and that Exhibit A identifies all of Borrower’s
existing indebtedness and obligations to Junior Creditor, and agrees that it will
not pay any indebtedness subordinated by the foregoing Subordination Agreement
(except as otherwise permitted thereby) until all indebtedness of Borrower to
Bank now existing and hereafter arising shall have been paid in full and Bank’s
financing arrangements with Borrower are terminated. In the event of any breach
of the provisions of

 

 

foregoing Subordination Agreement, Borrower agrees that, in addition to
any other rights and remedies Bank may have, all of Borrower’s obligations and
liabilities to Bank shall, without notice or demand, become immediately due and
payable, unless Bank shall otherwise elect.

 

	
   

  	
  FOSSIL PARTNERS, L.P

  
	
   

  	
   

  
	
   

  	
  By: Fossil, Inc.,

  
	
   

  	
  its general partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Randy S. Kercho

  	
   

  
	
   

  	
   

  
	
   

  	
  Name: Randy S. Kercho

  
	
   

  	
   

  
	
   

  	
  Title:VP and Chief
  Financial Officer

  

 

 

EXHIBIT A

 

TO SUBORDINATION
AGREEMENT

 

I.                                         Indebtedness
Owen to Junior Creditor

 

II.                                     Permitted
Payments

 

So long as, after giving
effect to such payment, Borrower remains in compliance with all the covenants
of the Loan Agreement and no Event of Default (as defined in the Loan Agreement)
then exists, Junior Creditor may accept and retain principal and interest
payments of the note evidencing the Subordinated Indebtedness. The Junior
Creditor hereby acknowledges that it has been provided a copy of and has Loan
Agreement.

 

 

LEGEND TO NOTE

 

THIS NOTE, AND PAYMENT
AND ENFORCEMENT HEREOF, IS SUBJECT TO THE TERMS AND PROVISIONS OF THAT CERTAIN SUBORDINATION
AGREEMENT DATED AUGUST 31, 1994, BETWEEN FOSSIL TRUST AND FIRST INTERSTATE BANK
OF TEXAS, N. A. AND ACKNOWLEDGED BY FOSSIL PARTNERS, L.P., AS SUCH
SUBORDINATION AGREEMENT MAY BE AMENDED FROM TIME TO TIME.MASTER LICENSE AGREEMENT

 

This
MASTER LICENSE AGREEMENT (“ Agreement”) is made and entered into as of August
30, 1994, by and between FOSSIL, INC., a Delaware corporation (hereinafter
referred to as “Licensor”) with a principal office at 2280 N. Greenville,
Richardson, Texas 75082, as Licensor, and FOSSIL PARTNERS, L.P., a Texas
limited partner., as well as any operating subsidiary and affiliates of
Licensor that becomes a party hereto after the date hereof (hereinafter
referred to collectively as “Licensees” and each a “Licensee”).

 

WITNESSETH:

 

WHEREAS,
Licensor owns rights in certain trademarks (and the current applications for
federal registration of certain other trademarks), as well as the goodwill
associated with such trademarks and applications for trademarks;

 

WHEREAS,
each Licensee desires to obtain a nonexclusive license to use such intellectual
property rights in connection with the sale, marketing and distribution of
certain goods; and

 

WHEREAS,
Licensor is willing to grant such a license to each such Licensee under the
terms of this Agreement.

 

NOW
THEREFORE, in consideration of the mutual promises contained herein, and
subject to the terms and conditions of this Agreement. Licensor and each
Licensee (severally, but not jointly) agree as follows:

 

ARTICLE I

 

License Grant

 

(a)           Licensor grants to each Licensee the
nonexclusive right and license to use the Marks (as defined below) in
connection with the Licensed Goods (as defined below) during the tenn of this
Agreement.

 

(b)           “Marks” is defined in this Agreement
as (i) the trademarks listed in Schedule A (as such may be supplemented
or amended from time to time) attached hereto, having the federal registrations
shown on Schedule A, and (ii) the trademarks listed in Schedule B
for which applications for registration are pending in the U.S. Patent and
Trademark Office as listed in Schedule B (as such may be supplemented or
amended from time to time) attached hereto.

 

(c)           “Licensed Goods” is defined in this
Agreement as all goods bearing the Marks as authorized by Licensor from time to
time.

 

(d)           Each Licensee agrees that Licensor
retains full ownership of the Marks and the goodwill associated with the Marks,
that no Licensee shall acquire any rights in the Marks other than those rights
expressly granted by Licensor pursuant to and during the term of this
Agreement, and that use of the Marks by any Licensee inures to the benefit of
Licensor.  Each Licensee agrees to
cooperate fully with Licensor in securing and maintaining the goodwill of
Licensor in the Marks, and to execute and deliver any and all agreements,
instruments and other documents necessary or appropriate to secure, maintain
and evidence such goodwill of Licensor in the Marks.

 

ARTICLE II

 

Term

 

The
term of this Agreement shall commence on August 31, 1994, and shall initially
be for the 12-month period immediately following such date. This Agreement
shall automatically be renewed for successive 12-month periods unless, prior to
the end of the initial term or any renewal tenn, Licensor or Licensee gives the
other party

 

 

notice of its intention not to renew this
Agreement, in which case this Agreement shall not be renewed with respect to
each Licensee who has given such notice to Licensor or who has been given such
notice by Licensor.

 

ARTICLE III

 

Default, Termination

 

(a)           In the event that either Licensor or
any Licensee is in breach of or default under the terms of this Agreement (a “Default”),
the other party may serve on the defaulting party a notice of default (“Notice
of Default”) specifying the nature of the Default. If the Default is not cured
within fifteen (IS) days from service of the Notice of Default, the other party
may then serve a notice (the “Termination Notice”) that it is terminating this
Agreement and the Agreement shall be automatically terminated, in which case
this Agreement shall be terminated with respect to each Licensee who has served
such Termination Notice on Licensor or upon whom such Termination Notice has
been served by the Licensor. Notwithstanding the foregoing, this Agreement
shall be terminated immediately without notice as to any Licensee in the event
of the bankruptcy or judicial or administrative declaration of insolvency of
such Licensee, or in the event that such Licensee makes any assignment for the
benefit of creditors (such events being collectively referred to hereinafter as
“Events of Automatic Termination” and each an “Event of Automatic Termination’’),
provided, however, that such termination without notice shall apply only with
respect to the Licensee or Licensees to whom such an Event of Automatic
Termination has occurred, and the license of each of the other Licensees to
whom such an Event of Automatic Termination has not occurred shall continue
without regard to the status of the license of such Licensee or Licensees
subject to such Event of Automatic Termination.

 

(b)           Upon expiration or termination of
this Agreement for any reason, all rights granted to a Licensee hereunder shall
cease, and any such Licensee will immediately refrain from further use of the
Marks, take down all signs displaying the Marks, and destroy or return to
Licensor all other materials containing, displaying or using the Marks.

 

ARTICLE IV

 

Royalty Payments

 

Licensor
acknowledges and agrees that Licensee will incur expenses related to the
marketing and promotion of the Licensed Good as well as increasing the
recognition and goodwill associated with the Marks covered by this agreement.
In consideration of Licensee’s agreement and undertaking to incur such expenses
and to use its best efforts to increase the notoriety and consumer awareness of
the Marks, all for the benefit of Licensor. Licensor and Licensee agree that no
royalty payment or licensing fee shall be payable by Licensee to Licensor
hereunder.

 

ARTICLE V

 

Books of Account and Records

 

Each
Licensee agrees to keep accurate books of account and records covering all
transactions relating to the Licensed Goods. Licensor and its authorized
representatives shall have the right to examine and copy said books of account
and other records; provided, however, that such examination and copying shall
be done at the usual place of business (and only during reasonable hours) of
the Licensee whose books of account and records Licensor desires to examine and
copy. unless such restrictions are not required by said Licensee.

 

 

ARTICLE VI

 

Quality Control; Advertising Materials

 

(a)           Each Licensee agrees to maintain such
quality of Licensed Goods sold or otherwise provided under or in connection
with the Marks in accordance with specifications set forth by Licensor from
time to time. Licensor reserves the right to inspect the quality of such
services to ensure that the quality required is maintained.

 

(b)           Licensor may from time to time
require any Licensee to furnish Licensor samples of advertising or other
promotional materials to be used in connection with the Licensed Goods. Each
Licensee agrees that it will use the Marks in any reasonable manner required by
Licensor in order to identify Licensor’s rights in such Marks.

 

ARTICLE VII

 

Indemnity/Hold Harmless

 

Each
Licensee agrees that it is wholly responsible for all goods offered or sold by
it, and that Licensor shall have no liability for or in connection with any
services offered, sold or otherwise provided by Licensee in connection with the
Marks. Each Licensee severally agrees to indemnify and hold harmless Licensor
and the officers, directors, shareholders, employees and agents of Licensor,
from and against any and all claims, demands, causes of action, damages, costs
and expenses, including court costs and reasonable attorneys’ fees, caused by
or arising out of or in connection with the use by such Licensee of the Marks
or the offer, sale or provision of any such services by a Licensee, including
without limitation, claims or actions for negligence, breach of contract,
strict liability and patent or copyright infringement.

 

ARTICLE XIII

 

Miscellaneous

 

8.1           Headings. All article or
section headings in this Agreement are for reference only and shall not be
deemed to control or affect in any way the meaning or construction of any of
the provisions hereof.

 

8.2           Binding Effect. This Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns.

 

8.3           Counterparts. This Agreement
may be executed in any number of counterparts, all of which together shall
constitute one agreement binding on the parties hereto,

 

8.4           Applicable Law. This Agreement
shall be treated as though it were executed in Dallas county, Texas and shall
for all purposes be. governed by and interpreted and enforced in accordance
with the laws of the State of Texas, without regard to the choice of law
principles thereof.  Each Licensee hereby
agrees that any action arising out of this Agreement shall be litigated under
the laws of the State of Texas in a Court of competent jurisdiction in Dallas
county, Texas.

 

8.5           Notices. Any notice, request,
consent or communication (collectively a “Notice”) under this Agreement shall
be effective only if it is in writing and (a) personally delivered, (b) sent by
certified or registered mail, return receipt requested, postage prepaid, (c)
sent by a nationally recognized overnight delivery service, with delivery
confirmed, or (d) telexed or telecopied. with receipt confirmed, addressed, if to
Licensor, as follows:

 

 

Fossil.
Inc

2280
N. Greenville

Richardson,
Texas 75082

Attention:
General Counsel

 

and
if to a Licensee, to the address of such Licensee on the books and records of
Licensor, or to such other address or addresses as shall be furnished in
writing by any party to the other party. Unless the sending party has actual
knowledge that a Notice was not received by the intended recipient, a Notice
shall be deemed to have been given, served and received (i) as of the date when
personally delivered, (ii) three days after being deposited with the United
States mail properly addressed, (iii) the next day after being delivered to
said overnight delivery service, properly addressed and prior to such delivery
service’s cut off time for next day delivery, or (iv) when receipt of the telex
or telecopy is confirmed, as the case may be.

 

8.6           Entire Agreement; Modification.
This Agreement contains the complete expression of the agreement between the
parties with respect to the matters addressed herein and there are no promises,
representations, or inducements except as herein provided. The terms and
provisions of this Agreement may not be modified, supplemented or amended
except in writing signed by both parties hereto. All terms and provisions of
this Agreement shall be binding upon and inure to the benefit of and be
enforceable by the respective successors and permitted assigns of the parties
hereto.

 

8.7           Assignment. Either party
hereto shall have the right to assign this Agreement only to (i) any successor
assignee of such party that may result from any merger, consolidation or
reorganization or (ii) another corporation that acquires all or substantially
all of such party’s assets, business and liabilities.

 

8.8           No Waiver. Failure by either
party hereto to enforce at any time or for any period of time any provision or
right hereunder shall not constitute a waiver of such provision or of the right
of such party thereafter to enforce each and every such provision.

 

8.9           Severability. The provisions
of this Agreement are severable, and if any provision shall be held illegal,
invalid, or unenforceable, the parties affected thereby shall substitute for
the affected provision an enforceable provision that approximates the intent
and economic benefit of the affected provision as closely as possible, but all
other provisions shall continue in full force and effect.

 

8.10                           Intent.

 

(a)           Notwithstanding anything herein to
the contrary, it is the intent of the parties that Schedule A and Schedule B
attached hereto may be supplemented or amended, from time to time, by Licensor,
so as to add additional Marks (but no additional royalty under Article IV
hereof shall be payable). Such supplement or amendment shall be effective upon
notice by Licensor to a Licensee of such supplement or amendment, which such
notice shall contain a copy of the supplemented or amended schedule for
Licensee’s files.

 

(b)           No language herein shall be construed
so as to give a right to Licensor to remove a Mark from the list of Marks in Schedule
A or Schedule B, unless consented to in writing by each Licensee who
would be affected by such removal; provided, however, that this provision shall
not limit the ability of Licensor to utilize its remedies and/or rights
specified in Article III hereof with respect to default and termination.

 

(c)           It is the intent of this Agreement
that each Licensee is to be severally (but not jointly) bound to the provisions
hereof. Nothing in this Agreement shall be construed so as to make any Licensee
responsible for any action, liability, breach or default of any other Licensee
to this Agreement; nor shall this

 

 

Agreement be construed so as to give any
Licensee any rights or benefits to which any other Licensee under this
Agreement may be entitled.

 

 

IN
WITNESS WHEREOF, this Master License Agreement has been duly executed by the
parties hereto as of the date first written above.

 

	
   

  	
  LICENSOR:

  
	
   

  	
   

  
	
   

  	
  FOSSIL,
  INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  T. R. Tunnell

  	
   

  
	
   

  	
  Name:
  T. R. Tunnell

  
	
   

  	
  Title:VP,
  Secretary & General Counsel

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  LICENSEE:

  
	
   

  	
   

  
	
   

  	
  FOSSIL
  PARTNERS, L.P.

  
	
   

  	
   

  
	
   

  	
  By Fossil, Inc./General Partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Randy S. Kercho

  	
   

  
	
   

  	
  Name:
  Randy S. Kercho

  
	
   

  	
  Title:
  VP & CEO

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