Document:

EXHIBIT 10.2.2

 

***Informal
translation - for information purposes only***

 

 

Financial Aid Agreement

 

 

DATE 31 AUGUST 2005

 

 

BETWEEN

 

 

 

Samsonite

 

Samsonite Europe NV

 

Artois Plasturgie SAS

 

And

 

HB Group

 

 

 

LEXENS

128, Boulevard Haussmann

75008 Paris

 

1

 

This financial aid agreement (the “Financial Aid Agreement”) has been signed on 31 August 2005,

 

BETWEEN :

 

1.                            SAMSONITE, a
company with limited liability (société par actions
simplifiée), with a share capital of EUR 720,000, having its
registered office at 27, rue de la Rochefoucauld, 75009 Paris, registered with
the commercial register of Paris under number 652 024 159 RCS Paris,
represented by Mr Marc Matton, in his capacity of chairman,

 

2.                            SAMSONITE
EUROPE NV, a Belgian company, with a share capital of EUR
3,665,105.76, having its registered office at Westerring 17, 9700 Oudenaarde
(Belgium), registered with the commercial register of Oudenaarde under number
16.079, represented by Mr Marc Matton, duly authorised by a meeting of the
board of directors of 18 July 2005,

 

(hereinafter collectively referred to as the “Creditors” or “Transferors”),

 

AND:

 

3.                            ARTOIS
PLASTURGIE, a company with limited liability (société par actions simplifiée), with a share capital of EUR
37,000, having its registered offices at 128, Boulevard Hausmann, 75008 Paris,
registered with the commercial register of Paris under number 483 173 308 RCS
Paris, duly represented by Mr Jean-Jaques Aurel, in his capacity of chairman,

 

(hereinafter referred to as the “Company” or the “Debtor”)

 

IN THE PRESENCE OF:

 

4.                            HB
Group, a Luxembourg company, with a share capital of EUR 31,000, having its
registered office at Rue de L’Industrie L-3895 FOETZ (Luxembourg), registered
with the commercial register of Luxembourg under the number B-109972,
represented by Mr Jean-Jaques Aurel, in his capacity of director, duly
authorised by a meeting of the board of directors of the company dated 26
August 2005,

 

(hereinafter referred to as
the “Transferee”)

 

The Creditors, the Company and HB Group are
hereinafter collectively referred to as the “Parties”.

 

2

 

WHEREAS :

 

1.                                      Samsonite
is the owner of and operates on the Site a business consisting of the
fabrication and manufacture of luggage and plastic products known under the
name «SIC ».

 

2.                                      As a
result of economic difficulties in the fabrication and manufacture of luggage
industry, and so as to avoid a hold of the Activities and the closure of the
Site, Samsonite has expressed its intention to sell and has had various
discussions with potential purchasers to take over the Site.

 

3.                                      Samsonite
has withheld HB Group as takeover candidate.

 

4.                                        The labour
unions of Samsonite (Comité Central d’Entreprise
et Comité d’Établissement du Site), who were consulted on the
envisaged Take-Over by HB Group, rendered their advice on the envisaged
Take-Over on 10 June 2005 and 4 July 2005, respectively.

 

5.                                        In order
to ensure the continued existence of the Site, and taking into account the
envisaged re-launching measures of development and restructuring, HB Group has
made its industrial project subject to the condition that Samsonite and
Samsonite Europe NV, without being involved in any way in the management,
assist in the reactivation and restructuring of the Activities by granting an
exceptional advance (the “Financial Aid”) amounting to an aggregate amount of
EUR 9,228,994.

 

6.                                        The
Parties have agreed to enter into this Financial Aid Agreement, which is a
condition precedent to the completion of the Take-Over of the Site.

 

Article 1 :      DEFINITIONS AND INTERPRETATION

 

1.1                     Definitions

 

Capitalised terms in this Financial Aid
Agreement shall have the following meaning:

 

	
  Effective Date

  	
  1 September, 00.00 am

  
	
   

  	
   

  
	
  Activities

  	
  The
  activities of fabrication and manufacture of luggage and the SIC Activities.

  
	
   

  	
   

  
	
  Affiliated Companies

  	
  Companies or
  entities controlled by Samsonite Corp. Control has the meaning described in
  article L.233.3 of the French Commercial Code.

  
	
   

  	
   

  
	
  Bank Account of the Company 

  	
  The bank account with number                
  opened in the name of the Company with the bank named Banque de
  l’Economie

  

 

3

 

	
  Bank Account of the Paying Agent

  	
  The bank account with number                      
  opened in the name of the Creditors with the bank named Banque de
  l’Economie

  
	
   

  	
   

  
	
  Guarantee Period

  	
  24 months
  commencing on the Effective Date

  
	
   

  	
   

  
	
  Net
  Asset Value of the Company

  	
  The
  net asset value of the Company on the Effective Date as mentioned on line DL
  of the printout n° 2051 (2005, in thousands) in the tax documentation.

  
	
   

  	
   

  
	
  Paying Agent

  	
  Samsonite
  Europe NV

  
	
   

  	
   

  
	
  SIC Activities

  	
  The activities of fabrication of plastic products, mainly
  to serve the automobile and motorcycle industry, and the related know-how of
  Samsonite available on the Site before the Effective Date based on its know-how
  in relation to the luggage industry.

  
	
   

  	
   

  
	
  Site

  	
  The site of exploitation located at Hénin Beaumont,
  504/520 boulevard Fernand Darchicourt, 62110 Hénin Beaumont.

  
	
   

  	
   

  
	
  Take-Over of the Site

  	
  The take-over of the business and the
  Activities in view of the realisation of the industrial project.

  
	
   

  	
   

  
	
  Third Party

  	
  Any person, whether a legal entity or a physical
  person, that is not a party to this Agreement and the Related Agreements.

  

 

1.2                     Interpretation

 

In this Financial Aid Agreement, unless
otherwise provided for:

 

(i)                                     references
to an article are references to an article of this Financial Aid Agreement;

 

(ii)                                  references
to a provision of the law are references to such provision as amended, applied,
modified or coordinated and include any provisions arising there from;

 

(iii)                               references
to words mentioned in plural include references to the singular form and vice versa;

 

(iv)                              references
to a person include a reference to its successors, assignees and transferees;

 

(v)                                 the headings mentioned in this Financial Aid Agreement
are used for ease of reference and are not to be considered in interpreting
this Agreement;

 

4

 

(vi)                              references
to any other agreement or document are to be interpreted as applicable to such
other agreement or document as amended, supplemented, restated or novated from
time to time.

 

Article 2 :                                        Purpose
of this Financial Aid Agreement

 

The Creditors have agreed to grant to the
Company, which accepts, the Financial Aid consisting of

 

(1)                        a subsidy
( the “Subsidy”) of 4,000,000 EUR,

 

(2)                        a
participative loan (the “Participative Loan”)
for an amount of EUR 4,228,994.

 

(3)                        an advance
to be paid into the account of the associates (the “Advance”)
of EUR 1,000,000,

 

in accordance with the terms, charges and
conditions set out in this Financial Aid Agreement.

 

The amounts transferred in accordance with this
Financial Aid Agreement are to serve towards the restructuring of the
Activities, the working capital, investments and the professional trainings
necessary to realize the industrial project of the Company and the HB Group
with respect to the Site.

 

During the entire Guarantee Period, the Company
undertakes to use the Financial Aid to the benefit of the Activities of the
Site and to the benefit of its restructuring.

 

During the entire Guarantee Period, the Company
undertakes not to dispose of any Financial Aid received, by means of dividend
distributions or repayment of the Participative Loan or the Advance, except for
the following permitted dispositions: the Company may dispose of an amount
equal to the Advance, increased by 10% of the Financial Aid, this 10% being
limited to EUR 920,000.

 

Article 3 :      Subsidy

 

The Creditors shall grant to the Company, which
accepts, in accordance with the terms and conditions as set out in this
Financial Aid Agreement, a non-refundable Subsidy of a global amount of EUR
4,000,000 , divided into two tranches, being Tranche A and Tranche B.

 

The Subsidy shall be made available to the
Company by means of transfer from the Bank Account of the Paying Agent to the
Bank Account of the Company, or by means of a bank cheque within the period as
stated below and under the following conditions:

 

5

 

• Tranche A: EUR 2,800,000 on the Effective Date;

 

• Tranche B: EUR 1,200,000 at the end of the Guarantee
Period and upon the condition that the Company has not been rightfully held
liable on the basis of the agreements entered into between the Parties, and in
particular with regard to a default in the quality of the products and
sub-assemblies, and non-compliance with delivery periods and the compensation
which may result therefrom.

 

Article 4 :      Participative
Loan

 

4.1       Object

 

The Creditors shall grant to the Company, which
accepts, a Participative Loan, within the context of and in accordance with the
law n° 78-741 of 12 July 1978, and under the terms and conditions as set out in
this Financial Aid Agreement.

 

4.2       Amount

 

The amount of the Participative Loan is EUR
4,228,994.

 

The Participative Loan will be made available
to the Company by means of a transfer from the Bank Account of the Paying Agent
to the Bank Account of the Company on the Effective Date, or by means of a bank
cheque.

 

4.2                                  Duration

 

The Participative Loan is granted for a period
of seven (7) years as of the date that the funds are made available.

 

4.3       Interest
– Participation clause

 

The amounts made available under the
Participative Loan shall accrue interest at 6% annually.

 

In accordance with article L313-19 of the
Monetary and Financial Code, this interest will be increased by a 15%
participation in the net profits of the Company.

 

4.4       Repayments

 

The repayment of the capital and the payment of
the interest shall occur in accordance with the amortisation table attached as
Annex 1.

 

The first transfer (capital and interests)
shall not be made before 24 months after the date of the funds being made
available.

 

6

 

4.5       Prepayment

 

The Company shall not be released from its
obligations by means of prepayment of the total or partial amount of the
current loan before the expiration of a period of 24 months following the funds
being made available, except if the prepayment is compensated by an equivalent
amount of capital being contributed in the Company, it being understood that
this contribution may not be the result of the re-evaluation of assets and that
these funds will remain within the Company for at least 24 months following the
Effective Date;

 

After this period of time, at the time of each
envisaged expiry date, the Company may free itself from its obligations by
means of a prepayment of the total amount of the current loan.

 

Each prepayment, voluntary or involuntary, in
accordance with this Financial Aid Agreement will not result in any
compensation being or becoming due.

 

Article 5 :      Advance

 

The Creditors grant to the Company, which
accepts, under the terms and conditions as set out in this Financial Aid
Agreement, the Advance of a total amount of 1,000,000 EUR.

 

The Advance will be made available to the
Company by means of a transfer from the Bank Account of the Paying Agent to the
Bank Account of the Company on the Effective Date.

 

Article 6 :      Undertakings of the
Company

 

The Company undertakes:

 

•                  not to
transfer any of its rights or obligations under the Financial Aid Agreement,

 

•                  to record
the operations relating to the Participative Loan in an account especially
opened for this purpose in its bookkeeping;

 

•                  to present
to the Paying Agent all the documents which it judges useful at any time,
amongst others the accounts of each economic exercise (profit and loss
accounts, balance, accounts, etc...) necessary for applying and controlling the
due execution of this Financial Aid Agreement;

 

Article 7 :      Undertakings of the HB Group

 

HB Group guarantees that the Company will
fulfil its obligations under this Financial Aid Agreement.

 

7

 

Article 8 :      Transfer

 

The Transferors are co-owners of (i) a
receivable for the amount of EUR 4,228,994 accruing interest at a rate of 6%
per annum on the basis of the Participative Loan as mentioned in article 4,
granted to the Company in accordance with this Financial Aid Agreement and (ii)
an unsecured receivable (the “Receivable”)
representing the Advance granted to the Company in accordance with the
Financial Aid Agreement. The Participative Loan and the Receivable together
represent the “Transferred Debt”.

 

It is specified that:

 

•                  the
Transferors transfer to the Transferee the Transferred Debt, and the Transferee
acquires the Transferred Debt;

 

•                  the
transfer price of the Transferred Debt is EUR 1;

 

•                  the
transfer price of the Transferred Debt is paid by the Transferee to Samsonite
Europe NV by means of a bank cheque; the Transferors shall distribute the
transfer price of the Transferred Debt amongst themselves.

 

Article 9 :      Other
matters

 

9.1
Notices

 

All notices and communications made or sent
between the Parties shall be effected by registered mail with evidence of
receipt or by letter handed over in person and signed for on receipt by the
addressee or by extra-judicial act (acte extrajudiciaire)
to the addresses and persons mentioned hereafter or to any other address or
person notified using the means described in the present article.

 

For the Creditors:

 

SAMSONITE

Mr. Marc Matton

27, rue de la Rochefoucauld

75009 Paris

 

With copy to :

 

LEXENS

Mr. Frédéric Boucly

128, Boulevard
Haussmann

75008 Paris

 

8

 

For the Tranferor:

 

SAMSONITE EUROPE NV

Mr. Marc Matton

Westerring 17,

9700 Oudenaarde

Belgium

 

With copy to:

 

LEXENS

Mr. Frédéric Boucly

128, Boulevard
Haussmann

75008 Paris

 

For the Purchaser:

 

Mr. Jean-Jaques AUREL

HB Group

Rue de l’Industrie

L-3895 Foetz

 

With copy to :

Fauvet La Giraudière
& Associés

Avocats à la Cour

92 avenue d’Iéna

75008 Paris

 

For the Company:

 

Mr. Jean-Jacques AUREL

At the registered office of the Company

 

With copy to :

Fauvet La Giraudière
& Associés

Avocats à la Cour

92 avenue d’Iéna

75008 Paris

 

9.2 Preamble and Annexes

 

The Preamble and the Annexes form an integral
part of this Financial Aid Agreement and are binding upon the Parties as if
they were an integral part thereof.

 

9

 

9.3 Confidentiality – Announcements

 

The Parties undertake to keep the Financial Aid
Agreement confidential with regard to all Third Parties, and to undertake all
necessary actions to ensure that their appointees and agents respect this same
obligation.

 

This obligation shall not apply in the event
that a Party, or an Affiliated Company is requested or required to present
information or a document relating to the Agreement or a Related Agreement by
an administrative-, judicial-, legal-, regulatory-, financial or market
authority (in particular the NSEC or NASD).

 

Similarly, the Parties may communicate to their
regular bankers, counsel, accountants, auditors, any information or document
relating to the Take-Over of the Site, these persons being bound by
professional confidentiality with regard to their clients.

 

9.4 Invalidity

 

If any of the provisions of this Financial Aid
Agreement are declared to be invalid or void, such provision will, to the
extent of its invalidity or it being void, cease to have effect and will be
considered as no longer part of this Financial Aid Agreement but can in no way
affect the validity and effectiveness of the other terms and conditions of the
Financial Aid Agreement.

 

9.5 Endorsement and renunciation

 

No modification to this Financial Aid Agreement
or to any document concluded in accordance with this Financial Aid Agreement
can be validly made, unless such modification is made in writing and signed by
all Parties.

 

The Parties reserve the right to, at all times,
exercise any right or undertake any action to better protect their interests,
and any delay or lack of exercise of such rights, cannot be interpreted as an
abandonment or renunciation of such rights or actions.

 

9.6 Costs, disbursements and taxes

 

Each Party shall bear its own costs and
disbursements incurred as result of the preparation of this Financial Aid
Agreement and the realisation of the operations envisaged in the terms of this
Financial Aid Agreement.

 

9.7 Applicable law and choice of forum

 

Any litigation relating to the conclusion,
performance and/or interpretation of this Financial Aid Agreement will be
resolved in accordance with French law.

 

10

 

Any litigation relating to the conclusion,
performance and/or interpretation of this Financial Aid Agreement will be
submitted in first instance to the jurisdiction of the Commercial Court of
Paris.

 

Paris, 31 August
2005

in 5 original
copies

 

 

	
   

  	
   

  	
   

  	
   

  
	
  Samsonite

  	
  Samsonite
  Europe NV

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Artois
  Plasturgie

  	
  HB Group

  

 

11EXHIBIT 10.2.3

 

***Informal
Translation – For Information Purposes Only***

 

Products
manufacturing agreement

 

 

Dated August 31, 2005

 

 

Between

 

Samsonite

 

Samsonite NV

 

HB Group

 

and

 

Artois Plasturgie SAS

 

 

LEXENS

128, Boulevard Haussmann

75008 Paris

 

 

This products manufacturing agreement (the “Manufacturing
Agreement”) is dated 31 August 2005,

 

BETWEEN:

 

1.                  SAMSONITE EUROPE NV, a
Belgian company, with a share capital of EUR 3,665,105.76, having its
registered office at Westerring 17 in 9700 Oudenaarde (Belgium), registered
with the commercial register of Oudenaarde under number 16.079, represented by Mr. Marc
Matton, duly authorised by a meeting of the board of directors held on 18 July 2005,

 

(hereafter referred to as the “PRINCIPAL”),

 

2.              SAMSONITE, a company with limited liability,
with a share capital of EUR 720,000, having its registered office at 27, rue de
la Rochefoucauld, 75009 Paris, registered with the commercial register of Paris
under number 652 024 159 RCS Paris, duly represented by Mr. Marc
Matton, in his capacity of chairman,

 

(hereafter referred to as “SAMSONITE”),

 

3.                  ARTOIS PLASTURGIE, a company with limited liability,
with a share capital of EUR 37,000, having its registered office at 128,
Boulevard Hausmann, 75008 Paris, registered with the commercial register of
Paris under number 483 173 308 RCS Paris, duly represented by Mr. Jean-Jacques
Aurel, in his capacity of chairman

 

(hereafter referred to as the “SUBCONTRACTOR” or the “CORPORATION”),

 

4.                  HB
GROUP, a Luxembourg
company, with a share capital of EUR 31,000, having its registered office at
rue de l’Industrie, L-3895 FOETZ (Luxembourg), registered with the commercial
register of Luxembourg under number B 109972, represented by Mr. Jean-Jacques
Aurel, in his capacity of director, duly authorised pursuant to a meeting of
the board of directors of the company dated 26 August 2005

 

(hereafter referred to as the “PURCHASER” or “HB
GROUP”).

 

The Principal, Samsonite, the Subcontractor (or the Corporation) and the
Purchaser (or HB Group) are hereinafter collectively referred to as the “Parties”.

 

 

WHEREAS:

 

1.                                      Samsonite is the owner of and
operates, on the Site, a business consisting of the fabrication and manufacture
of luggage and plastic products (“produits de plasturgie”)
known under the name «SIC ». Until the Effective Date Samsonite operated
the Business and acted as subcontractor of the Principal.

 

2.                                      As a result of economic difficulties
experienced in the Activities and so as to avoid the hold of the Activities and
the closure of the Site, Samsonite has proceeded with the transfer of the
Activities to the Subcontractor, in the framework of a partial contribution of
assets. The operation provides for the conclusion of various agreements,
amongst others, the conclusion of an agreement relating to the manufacturing of
the Products through subcontracting and the lending of moulds for such
manufacture.

 

3.                                      The Parties agree hereby on the
terms and conditions of the manufacturing of the Products and the lending of
the Moulds necessary for the manufacturing of the Products. This Manufacturing Agreement is a
condition precedent for the completion of the take-over referred to herein. The
terms and conditions for the manufacturing of No Name Products (as defined in
the No Name Products Manufacturing Agreement) are set out in a separate
agreement entered into by the Parties.

 

THE PARTIES HAVE AGREED AS FOLLOWS:

 

Article 1 :                DEFINITIONS AND INTERPRETATION

 

1.1                     DÉFINITIONS

 

Defined terms will have the same meaning as set out in the Agreement,
the No Name Products Manufacturing Agreement or in this Manufacturing
Agreement:

 

Components refers to all loose parts and equipment
(wheels, fabrics, handles, locks, labels, packaging, etc.) determined at the
sole discretion of the Principal, other than the Raw Materials used for the
composition of the COS and used for the manufacture, injection, assembly or the
packaging of the Products or the Subcontracting Products.

 

Production Capacity refers to the production capacity
of the Site at the Effective Date with three Working Days production teams and
one weekend production team.

 

Bank Account of the Principal refers to the Bank Account of the
Transferor.

 

Bank Account of the Subcontractor refers to the Bank Account of the
Company.

 

Agreement refers to the transfer agreement of the shares
of the Company and the subordinated claims relating to the take-over of the
Site Hénin-Beaumont executed on 29 July 2005 between the Parties, as amended pursuant
to the Appendix.

 

COS (or Cost of Sales) refers to the nomenclature of the
costs of the Products, consisting of “Material” (= Raw Materials + Components)
+ “Labour” (direct handiwork) + “Overhead” (indirect handiwork and costs
related to the Products).

 

Traditional Retailers refers to the shops and businesses
specialized in the distribution of 

 

2

 

leather products, luggage and travel products.

 

Industrial Property Rights refers to all industrial or
intellectual property rights of the Principal or of the Affiliated Corporations
notably relating to the Products and the Subcontracting Products, their
manufacture, their packaging and/or all activities connected therewith, more
specifically the Technical Information, patents, protected or protectable
trademarks and know-how, trade names, company names, rights of conception, data
bases, rights of reproduction and implementation for each of the rights
enumerated here above, as well as the right to dispose of these rights or of
similar rights in other countries.

 

In-Process refers to the goods and products during their
formation in the process of the manufacture of the Products

 

Activity Guarantee refers to the minimum quantity of
Products or its equivalent in turnover that the Principal undertakes to buy
from the Subcontractor or to the compensation that the Principal grants to the
Subcontractor pursuant to article 6 of the Manufacturing Agreement

 

Technical Information refers to all documents, all
information given by the Principal to the Subcontractor, including without
restriction, instructions with respect to the manufacture, the injection, the
labelling, the packaging, the storing, the maintenance and the quality and
conformity inspection of the Products or put at the disposal of the
Subcontractor by the Principal.

 

Trademarks refers to the trademarks and the names used for
the Products

 

Raw materials refers to the plastic materials, polypropylene
products and dyestuff determined at the sole discretion of the Principal, which
are part of the composition of the COS and supplied by the Principal or by a
Third Party approved by the Principal that are part of the composition of the
Products or the Subcontracting Products.

 

Spinner Wheels Model refers to the vertical suitcase
model (“trolley” type) of which more than two wheels can pivot around a
vertical axe.

 

Products Moulds refers to the moulds including their
monthly capacity, of which the reference is listed in Annex 7.1, lent to the
Subcontractor by the Principal for the duration of the Period in the framework
and for the execution of the Manufacturing Agreement.

 

Quality level refers to the level of quality of the Products
and the Subcontracting Products corresponding to the books of the working posts
at the Site and to the test results and statistics listed in Annex 3.3 of the
Manufacturing Agreement.

 

Period refers to the period of 18 to 24 months
starting on the Effective Date and ending on 1 September 2007 or at any
later date at which the Principal will be released from its minimal obligations
pursuant to Article 6 of the Manufacturing Agreement or pursuant to the
Agreement or the Related Agreements.

 

Products refers to the leather products and luggage
having completed a complete production cycle and ready to be sold to consumers,
of which is listed in Annex 0.(a) (which may be completed and amended by
the Principal at any time) and manufactured in conformity with the Technical
Information.

 

Subcontracting Products refers to the Components fabricated
by the Subcontractor and acquired by the Principal or the Affiliated Companies,
of which a list is attached as annex 0.(b) (which can be amended,
completed or reduced by the Principal at any time).

 

1.2                     INTERPRÉTATION

 

In the present Manufacturing Agreement, unless otherwise provided for:

 

3

 

(i)                                    references
to an article are references to an article of this Manufacturing
Agreement;

(ii)                                references
to a provision of the law are references to such provision as applied,
modified, coordinated and include any provisions arising therefrom;

(iii)                            references
to words mentioned in plural include references to the singular form and vice versa;

(iv)                               references
to a person include references to his successors and assignees;

(v)                                   the
headings mentioned in this Manufacturing Agreement are used for ease of
reference and are not to be considered in interpreting this Manufacturing
Agreement;

 

Article 2
:                OBJECT

 

2.1                     Production and
subcontracting of the Products and the Subcontracting Products

 

In accordance with the terms and conditions of
the Manufacturing Agreement, the Principal grants to the Subcontractor the
non-exclusive right to manufacture, inject, mount, assemble, label, package,
store and deliver the Products and the Subcontracting Products for the
Principal.  The Subcontractor undertakes
to exploit the rights granted in accordance with the terms and conditions of
the Manufacturing Agreement.

 

In accordance with the terms and conditions of
the Manufacturing Agreement, the Principal undertakes to order and buy the
Products and the Subcontracting Products from the Subcontractor, who undertakes
to manufacture the Products and to sell them exclusively to the Principal, or
to sell them to any person designated by the Principal.

 

2.2                     Maintenance of the
production of the Products, the Subcontracting Products on the Site –
Prohibition on subcontracting – Observance of the Quality and term obligations

 

The Subcontractor may not
without the prior written consent of the Principal subcontract, assign or
transfer in any manner whatsoever in whole or in part, the manufacture,
injection, mounting, assembly, labelling, packaging, storing (subject to the
obligation of the Principal to remove as set out in article 4.1) and the
delivery of the Products and the Subcontracting Products to a Third Party or
carry out these activities in a place other than the Site.

 

The Subcontractor agrees to
observe the Quality Level as well as the delivery terms which will apply to him
pursuant to the provisions of article 4 of the Manufacturing Agreement.

 

The obligations stipulated in the preceding
paragraphs constitute an essential condition to the consent and obligations of
the Principal under the Agreement and the Related Agreements.

 

The Principal may, at any time by written
notification addressed to the Subcontractor, transfer or assign all or part of
the rights and obligations resulting from the Manufacturing Agreement or
transfer or assign the Manufacturing Agreement to an Affiliated Corporation, or
to a Third Party, provided that the Third Party takes over all 

 

4

 

of the obligations of the Principal or of the
Affiliated Corporation, which will remain responsible for the execution of
these obligations, in particular, with respect to the payment of all sums due
pursuant to the Manufacturing Agreement.

 

The Principal may at any time complete, reduce
or amend the list of the Products and the Subcontracting Products of which a
list is attached in annex 0.(a) and 0.(b) of the Manufacturing
Agreement, it being specified that the Activity Guarantee as set out in article 6
and the exclusivity obligations set out in article 2.1 will continue to
apply. Every decision entailing an increase or a reduction of the list of
Products or Subcontracting Products, will not enter into force before one (1) month
has lapsed following the notification made by the Principal to the
Subcontractor. The Subcontractor will not be able to contend that he has or
formulate a claim for indemnification, reimbursement or compensation based on
this decision to modify the annexes 0.(a) and 0.(b), otherwise than as
stipulated in article 6.

 

If the Principal decides to transfer, assign or
licence the right to manufacture, inject, mount, assemble, label, package,
store and deliver the Products, the Subcontracting Products or the Industrial
Property Rights with respect to the Products or the Subcontracting Products to
a Third Party, the obligations stipulated in the Manufacturing Agreement will
continue to have effect in respect of the Subcontractor and the Third Party
until the end of the Manufacturing Agreement.

 

Article 3
:                SPECIFICATIONS,
PROVISIONING AND QUALITY OF THE PRODUCTS AND THE SUBCONTRACTING PRODUCTS

 

3.1                     Specifications and
Technical Information of the Products and the Subcontracting Products

 

The Principal undertakes to provide the
Subcontractor with the necessary Technical Information for the operations of
manufacture, injection, mounting, assembly, labelling, packaging, storing,
delivery of the Products or the Subcontracting Products and any other operation
subcontracted to the Subcontractor in the framework of the Manufacturing
Agreement.

 

If the Subcontractor is aware of any
contradiction between the Technical Information and the laws and regulations
applicable to the Site, the Subcontractor will inform the Principal thereof in
writing within five (5) Working Days. The Parties will consult with each
other to find an amicable solution to this situation. If the Subcontractor is
not able to carry on the manufacture of a Product or a Subcontracting Product
because of the non-conformity of the Technical Information with the laws and
regulations applicable to the Site, such situation shall not constitute a
breach of the Manufacturing Agreement.

 

The Subcontractor undertakes not to modify the
Technical Information without the prior written consent of the Principal.

 

The Principal may at any time by notification
carry out modifications to the Technical Information.  In such case, the new corresponding COS of
the corresponding Products 

 

5

 

and Subcontracting Products shall be fixed by
the Subcontractor who shall update the price list of the Products or the
Subcontracting Products and who shall notify the Principal hereof for control.
The financial consequences of these modifications shall benefit or shall be
borne by the Principal.

 

Following notification of a modification of the
Technical Information, the Subcontractor undertakes to reduce the number of
Products manufactured in accordance with the old Technical Information.  Without prejudice to the foregoing, the
Principal shall buy the Products that are manufactured by the Subcontractor
under the old Technical Information that corresponds to firm orders for the
Products on the date of the notification of the modification of the Technical
Information.

 

The Principal and the Subcontractor shall each
appoint two (2) responsible people (the “Responsible Persons”), one being
responsible for production and the other for the quality of the Products and
shall notify as soon as possible each change in Responsible Person.

 

The Subcontractor undertakes to carry out the
operations of manufacture, injection, mounting, assembly, labelling, packaging,
storing, delivery of the Products and all useful operations and activities for
the proper execution of the Manufacturing Agreement in accordance with the
Technical Information, with good practice of manufacture, inspection and
storing applicable to the Site, with the instructions of the competent
authorities, with the laws and regulations in force, notably the norms of
hygiene, security and environment and, more generally, undertakes to maintain a
Quality Level.

 

The Subcontractor shall notify as soon as
possible any decrease in the Quality Level.

 

3.2                     Supply of Raw Materials and
Accessories for the Products and the Subcontracting Products

 

The Subcontractor undertakes to buy from the
Principal or from a person appointed by the Principal, and the Principal
undertakes to sell, or to cause to be sold by each person appointed by it, to
the Subcontractor, the Raw Materials and the Components at the prices fixed or
determined in article 5 of the Manufacturing Agreement.

 

The Subcontractor undertakes to only use the
Raw Materials and the Components supplied by the Principal or supplied by any
person appointed by the Principal for the manufacture of the Products and the
Subcontracting Products, and to only use them for the manufacture of Products
and Subcontracting Products.

 

All Raw Materials and all Components that have
not been supplied by the Principal or by a supplier appointed by the Principal,
may only be used by the Subcontractor for the execution of its activities in
the framework of the Manufacturing Agreement or may only be used in the
production process of the Products or the Subcontracting Products, with the
prior written consent of the Principal as to the source of the supply or the
supplier of such Raw Material or the Component.

 

6

 

The Subcontractor may in no event change a
supply source or a supplier of Raw Material or Components appointed by the
Principal without prior written consent from the Principal. If the
Subcontractor considers using a new (source of supply or a new supplier of) Raw
Material or Component, the Subcontractor shall inform the Principal of its
plans as soon as possible and shall provide the Principal with all useful
documentation and samples for the execution of quality tests by the
Principal.  The approval, the examination
or the refusal of each new (supply source or of each new supplier of) Raw
Material or Component by the Principal is discretionary and no reasons have to
be given.

 

The Subcontractor undertakes to at all times
have a sufficient stock of Raw Materials and Components at its disposal to
fulfil the orders of the Principal within the limits determined in article 4
of the Manufacturing Agreement

 

The Subcontractor will keep all stocks of
Products, Subcontracting Products, In-Process and Raw Materials in such a
manner so as to avoid any risk of alteration or deterioration of the quality of
the Products (including the colour), of the Subcontracting Products of the
In-Processes and of the Raw Materials and will accept responsibility for the
storing and the maintenance thereof.

 

3.3                     Inspection of manufacture
and quality of Products and of Subcontracting Products

 

The Subcontractor is responsible for and will
set up any procedure for inspection of the manufacture and the quality of the
Products and the Subcontracting Products. The Subcontractor will inspect the
quality of manufacture and the delivery of the Products and the Subcontracting
Products in strict conformity and compliance with the Technical Information.

 

Provided that a notice period of 24 hours is
observed, the Principal reserves the right to carry out inspections of
compliance with the Technical Information, manufacture procedures, quality of
the Products, of the Subcontracting Products, of the Raw Materials and
Components at any time.  The existence or
the exercise of this right shall in no event limit or reduce the obligations
and the responsibility of the Subcontractor in this respect.

 

In this respect, the Subcontractor shall
provide the Principal or its representative within five (5) Working Days
following the request of the Principal, with any information, all samples and
all documents relating to the inspection of manufacture and quality, as
commonly used at the Site on the Effective Date, requested by the Principal and
the Subcontractor shall allow the Principal or his representative to proceed
with inspections, interventions or audits directly at the Site, upon the
request of the latter and without further delay.

 

If the Principal carries out an inspection of
the manufacture or of the quality, he shall communicate the results of such
inspection to the Subcontractor as soon as possible.

 

In case of a decrease in the Quality Level, the
Subcontractor undertakes to immediately take all useful measures to restore the
Quality Level.

 

7

 

Moreover, in the event of a repeated or
continuous decrease in the fabrication quality or of delay in the delivery of
the Products or the Subcontracting Products, the Principal can send one of its
teams onto the Site in order to advise or indicate to the Subcontractor which
measures should be taken to reinstate the Quality Level; the Subcontractor
shall bear all costs of these interventions and the measures to re-establish
the Quality Level, if these are founded or justified..

 

3.4                     Forecasts and orders

 

The Principal shall supply to the Subcontractor
a plan of the confirmed orders and the provisional orders for twelve weeks, for
the first time on 16 August 2005 and hereafter at the latest each month
(M) with (i) for the months (M) having four weeks, the first day of the
third week, and (ii) for the months (M) having five weeks, the first day
of the fourth week.

 

The orders of the
plan shall be definite for the first four weeks of the month following the
delivery of the plan (M+1) and provisional for the following weeks.

 

The first production
plan shall take into account the existing production capacities at the Site at
the date of the Manufacturing Agreement.

 

3.5                     The
Parties shall meet weekly in order to consider any modifications to the
planning of the confirmed orders which are requested by the Principal. The
Subcontractor can accept or refuse such modifications. If he accepts them,
these modifications will be performed in accordance with the Manufacturing
Agreement.

 

The plan for the
confirmed orders in accordance with the volumes set out in article 4.3 or
for which the modifications have been accepted by the Subcontractor will
qualify as an order form (the “Order Plan”).

 

Without prejudice to
the derogatory or particular terms and conditions of the Manufacturing
Agreement, the Subcontractor shall adhere to the general conditions of purchase
of the Principal.  The Subcontractor
confirm having knowledge of these general conditions of the Principal.

 

The terms and
conditions of the Manufacturing Agreement will prevail over the general terms
and conditions of purchase of the Principal. 
The latter terms and conditions will prevail over the terms and
conditions of sale and other documents of the Subcontractor.

 

3.6                     The
Subcontractor undertakes to put at the disposal of the Principal a Production Capacity
of a minimum of fifty percent (50%), per machinery and per month (including 50%
of the production capacity of the No Name Moulds put at the Subcontractor’s
disposal for the manufacture of the No Name Products and the Products), of the
maximum Production Capacity existing at the Effective Date. The Subcontractor
undertakes to do its utmost best to fulfil the orders of the Principal that
exceed its monthly provisions by 15 percent (15%).

 

8

 

Article 4
:                DELIVERIES

 

4.1                     The Products and Subcontracting
Products shall be delivered, packaged by the Subcontractor EX works (EXW) (as
these terms are defined in the 2000 Incoterms) on the Site in accordance with
the Technical Information. The Subcontractor undertakes to observe time periods
for delivery and the quantities indicated on the order forms of the Principal.
The Subcontractor is in charge of the loading of the Products and the
Subcontracting Products.  The Principal
shall bear the costs and risks inherent in the transport of the Products and
the Subcontracting Products and shall do its best to take delivery of the
Products and Subcontracting Products according to production and within a
reasonable time period after the Subcontractor has made them available.  The Principal takes on the obligation to take
delivery of the Products and the Subcontracting Products as they are available
to ensure that the Products and Subcontracting Products that are ready to be
delivered, do not exceed a quantity of Products and Subcontracting Products
equal to one day of Production Capacity. If the Principal does not take
delivery of the quantities of Products and Subcontracting Products that are
delivered within the term determined above, he shall bear the cost of the
storage with which the Subcontractor will be faced.

 

4.2                     The Principal will have eight (8) Working
Days after the delivery of the Products to verify the identification (i.e. the
labelling, the series numbers), the visible damage and the quantity of the
Products and the Subcontracting Products, and more generally, the
correspondence of the deliveries made by the Subcontractor with the Order Plan.
If, within this time, the Principal ascertains any visible damage, an
insufficient quantity of Products and Subcontracting Products or a discrepancy
between the delivered Products and the Subcontracting Products, and the terms
of the Order Plan, the Principal undertakes to notify the Subcontractor thereof
within 48 hours following the expiry of the said time period In the event of
failure to do so, the deliveries will be presumed to conform with the order
forms and the Products will be presumed to be free of visible defects or
damage.

 

4.3                     The Principal has six (6) months
following the delivery of the Products and the Subcontracting Products to carry
out any other examination of the quality and the conformity of the Products and
Subcontracting Products with the specifications indicated in the Technical
Information and to ascertain the existence of defects, non-conformities, problems
affecting the delivered Products or Subcontracting Products. If the Principal
ascertains that the delivered Products or Subcontracting Products contain
defects, problems or anomalies or if they do not conform with the indicated
specifications in the Technical Information, the Principal undertakes to notify
the Subcontractor thereof within five (5) Working Days following the
expiry of the said time period. In case of failure to so, the Products and
Subcontracting Products will be presumed to be conform with the specifications
indicated in the Technical Information and to be free of fault.

 

If the Parties do not reach an agreement,
within thirty (30) Working Days following the receipt of the notification of
the rejection of the products referred to above, on the existence of problems,
anomalies or lack of conformity of the Products, the dispute will be submitted
to an independent expert appointed by the Parties.  If the Parties do not agree on the name of
the expert within five (5) Working Days following the expiry of  

 

9

 

thirty (30) Working Days referred to above, the
most diligent party may request the appointment of an expert by the President
of the Commercial Court of Paris (“Président du Tribunal de commerce
de Paris”). The expert has thirty (30) Working Days to issue his
report. The decision of the expert will be binding on the Parties. If the
decision of the expert confirms wholly or partially the decision of rejection
of the Principal, the latter may reject the Products. The costs of the
assessment by the expert shall be borne by the party in default.  In the case of shared responsibility, the
costs of the assessment by the expert will be shared between the Parties in
proportion to their respective responsibility.

 

4.4                     With respect to the provisions of
articles 4.2 and 4.3 above, the Principal may reject and send back Products and
Subcontracting Products that do not correspond with the specifications and
quality norms indicated in the Technical Information or that do not correspond
with the terms of the order forms, without having to pay for these Products. In
such case, the Subcontractor can replace the defective or non conforming
Products and the Subcontracting Products if he is able to comply with the terms
determined in the Order Plannings.

 

4.5                     If the Subcontractor does not
replace the defective or non conforming Products and Subcontracting Products
within the terms agreed upon, the Subcontractor shall indemnify the Principal
for all damage or losses which the Principal incurs as a result of the
non-compliance of the Subcontractor with the Product Manufacturing Agreement.

 

Article 5
:                PRICE AND PAYMENT MODE

 

5.1                     Raw Materials

 

During the entire Period, the Subcontractor
will preferably purchase from suppliers authorised by the Principal, or from
the Principal, the authorised supplier or the Principal will invoice the
Subcontractor at delivery on the basis of the unit price applicable for the Raw
Materials ordered by the Subcontractor and delivered by the authorised supplier
or the Principal, as indicated and determined in Annex 5.1. The price of the
Raw Materials will be readjusted each trimester as from the Effective Date,
with effect from the first day of the following trimester, based on the average
price of the Raw Materials noted during the current trimester.

 

The Principal shall decide in the same manner
on the applicable unit prices and their adjustments for the Raw Materials
ordered by the Subcontractor with suppliers agreed upon by the Principal.

 

The Principal shall notify the Subcontractor of
the list of the unit sales price, taxes not included, of the Raw Materials for
the first time on 19 August 2005 and subsequently, within ten (10) Working
Days before the end of each trimester, taking into account any developments in
the price of Raw Materials during the said trimester.

 

10

 

The new unit sales price, taxes not included,
thus adjusted will be applicable to orders of Raw Materials of the Subcontractor
placed as of the first day of the following trimester.

 

Each invoice shall, to the extent possible,
state the number of the order of the Subcontractor, the name, the reference and
the quantities of Raw Materials delivered. 
The invoices shall be paid on the fifth (5th) of the month following the month
of receipt of the invoice.

 

The Subcontractor shall pay the Principal’s
invoice by bank transfer to the Bank Account of the Principal or directly to
the agreed supplier appointed by the Principal.

 

5.2                     Components

 

During the entire Period, if the Subcontractor
purchases from the Principal, the Principal will invoice the Subcontractor on
delivery on the basis of the unit price applicable to the quantities of
Components purchased by and delivered to the Subcontractor, as indicated and
determined in Annex 5.2.

 

Each invoice shall, to the extent possible,
state the number of the order of the Subcontractor, the name, the reference and
the quantities of Components delivered. The invoices shall be paid on the fifth
(5th) of the month following the month of receipt of the invoice.

 

The Subcontractor shall pay the Principal’s
invoice by bank transfer to the Bank Account of the Principal.

 

The Principal guarantees, at the start of each
calendar year and for the whole of the calendar year, a fixed price for each
Component, whether the Components are purchased from the Principal or from a
Third Party agreed upon by the Principal.

 

5.3                     Price of the products

 

During the entire Period, the unit price of
each Product (taxes not included) is fixed and determined pursuant to a
calculation method based on the COS.

 

The sales price taxes not included (“PVHT”) for
each Product is determined in accordance with the formula PVHT = COS/70%).

 

The Principal shall communicate the list of the
current COS which are used as a basis for the calculation of the sales price of
the Products. The list of the current COS for the year 2005 is present at the
Site and at the disposal of the Subcontractor.

 

The Subcontractor shall proceed with a readjustment,
an increase or a decrease, of the COS and which are used as a basis for the
calculation of the unit sales price of the Products:

•                  Regarding the Raw Materials: each
three months as of the Effective Date taking into account the readjustment of the
price of the Raw Materials in accordance with the conditions and methods
described above in article 5.1.

 

11

 

•                  Regarding the Components: the 1st
of March of each calendar year based on the prices guaranteed by the
Principal and in accordance with the conditions and methods described above in article 5.2.

•                  Regarding the “Labour” and “Overhead”,
the 1st of March of each year in accordance with the index
INSEE no. 064693845 – Trimester index of monthly gross remuneration (private
sector or semi public) such index being fixed at the level 115.5 on 31 March 2005.

 

The Subcontractor shall notify to the Principal
the list of the unit sales price, taxes not included, of the Products for the
first time on 1 September 2005, this list being annex 5.3 hereto.

 

Subsequently, the notification of the
readjusted price list shall occur within a term of ten (10) Working Days
preceding each 1st of March or each 1st day of the
trimesters calculated as of the Effective Date.

 

The new unit sales prices, taxes not included,
adjusted accordingly will apply to the delivery of the Products as of the 1st
day of the month following the notification of a readjusted price list.

 

5.4                     Prices of the
Subcontracting Products

 

During the whole of the Period, the unit price
of each Subcontracting Product (taxes not included) is fixed and determined in
accordance with the current analytic bookkeeping method of COS defined at its
highest. The PVHT is determined for each Subcontracting Product based on the
formula: PVHT = COS/77%.

 

5.5                     Invoicing

 

The Subcontractor shall
invoice the Principal at the delivery. Each invoice shall, to the extent
possible, indicate the name, the reference and the quantities of the delivered
Products. The invoices shall be paid at the end of the month, the fifth (5th) of the month following the month
of receipt of the invoice. The Principal shall pay the invoice by bank transfer
to the Bank Account of the Subcontractor.

 

If adjustments of the invoices between the
parties are necessary, each adjustment will take the form of a credit note or a
debit note.

 

The Parties may set off or compensate the debts
and claims existing between them in the framework of the Manufacturing
Agreement, the Agreement or the Related Agreements.

 

Article 6
:                QUANTITIES AND GUARANTEED
TURNOVER

 

6.1                     The Principal undertakes to order
from the Subcontractor during the Period a minimum quantity of Products
corresponding to a minimum turnover of eleven million four hundred twenty-eight
thousand (11,428,000) euros (not including the Subcontractor’s turnover).

 

12

 

6.2                     If the purchases by the Principal do
not correspond to the minimum turnover indicated here above, the Principal
undertakes to transfer to the Subcontractor compensation for fixed costs and
the non-covered charges that have been borne by the Subcontractor, calculated
as follows, progressively and cumulative per part of unrealised turnover as
follows:

 

	
  Turnover part

  	
   

  	
  Compensation
  amount

  
	
  From 11,420,000 € to 10,000,000 €

  	
   

  	
  Unrealised turnover of the opposite part x 30%

  
	
  9,999,000 € to 8,000,000 €

  	
   

  	
  Unrealised turnover of the opposite part x 40%

  
	
  7,999,000 € to 5,000,000 €

  	
   

  	
  Unrealised turnover of the opposite part x 60%

  
	
  < 5,000,000 €

  	
   

  	
  100% of unrealised turnover on the opposite part

  

 

Article 7
:                THE PLACING OF MOULDS AT THE DISPOSAL

 

7.1. Ownership of the Products Moulds and other
moulds

 

The Products Moulds and all other moulds serving in the production and
manufacturing of the Components are and will stay the property of the Principal
or the Affiliated Corporations.  The
Products Moulds and all other moulds serving or entering into production or the
manufacturing of the Products or the Components cannot be dissociated from the
Principal’s and the Affiliated Corporations’ Industrial Property Rights.  The Subcontractor agrees not to contest or
impair this property right in any way.

 

7.2. Loan of moulds for the injection of the
shells of the Products:

 

The Principal grants to the Subcontractor the right to use the Product
Moulds and other moulds (listed in annex 7.1), which he will make available to
it on loan, for the manufacturing of the Products and the Components.  This right to use the moulds is granted
exclusively for the execution of the obligations of the Subcontractor in the
framework of the Manufacturing Agreement and exclusively for the duration of
the Period.

 

Article 8
:                OBLIGATIONS OF THE PARTIES

 

8.1                               SUBCONTRACTOR’S OBLIGATIONS

 

The Subcontractor reiterates the obligations undertaken under the
Agreement and declares and guarantees that during the entire duration of the
Manufacturing Agreement it:

 

(i)                                    will have at its disposal, maintain
and develop the necessary expertise, human and technical means, staff, plant
and equipment to produce, package, label, inspect the quality, store, hand over
and deliver the Products in accordance with the Manufacturing Agreement;

 

13

 

(ii)                                will conduct and maintain at any
time its rooms, machines, equipment and procedures, notably of manufacture, in
accordance with French law and regulations in force and undertakes to ensure
that its employees are adequately trained and apply these laws and regulations;

 

(iii)                            will manufacture, package, label,
test the quality, store and deliver all the Products in strict conformity with
the specifications and quality norms detailed in the Technical Information and
with the applicable laws and regulations and maintain the Quality Level;

 

(iv)                               will not engage, nor try to engage
or assist a third party with a view to engaging any employee or any authorised
person (“mandataire social”) of the Principal,
with the exception of Transferred Employees, without the written consent of the
Principal. This non-engagement obligation will take effect on the date of the
execution of the Agreement and will remain in force for a duration of eighteen
(18) months after the expiry of the Manufacturing Agreement;

 

(v)                                   will observe the Intellectual
Property Rights, the trademarks and designs of the Principal or of the
Affiliated Corporations and the terms of the licence of rights granted to the
Subcontractor for the execution of the Manufacturing Agreement and will not
make reference to the Trademarks, to the products, moulds or names, company
name of the Principal or an Affiliated Corporation;

 

(vi)                               will not carry out or cause to be
carried out, in whatsoever manner, any modification or transformation of the
moulds given to it by virtue of article 7 of the Manufacturing Agreement
without the prior written consent of the Principal;

 

(vii)                           shall use the moulds lent to him by
the Principal by virtue of article 7 of the Manufacturing Agreement in an
appropriate manner, in accordance with their destination and the rules of
art and shall ensure that it keeps them in good condition for use.

 

(viii)                       any violation of the commitments and
obligations above will lead to the loss of the right to use the moulds lent to
the Subcontractor and the obligation to return them to the Principal or to any
Affiliated Corporation appointed by the Principal, without any delay and
without payment of any compensation by the Principal.

 

8.2                               PRINCIPAL’S
OBLIGATIONS

 

The Principal may request the Subcontractor to
manufacture the Products based on the No Name Moulds (such term being defined in
the No Name Products Manufacturing Agreement). 
Products manufactured based on these moulds will be considered as being
Products and must be manufactured, assembled, stocked as every Product
according to the Manufacturing Agreement.

 

14

 

The Principal will not commercialise the
Products manufactured based on the No Name Moulds in the large distribution
networks (“hypermarchés”) under any other name than
the “SAMSONITE” or “American Tourister” brands.

 

Article 9
:                INDUSTRIAL PROPERTY RIGHTS

 

9.1                     The Principal grants to the
Subcontractor, exclusively, a non-exclusive, non-assignable or non-transferable
and free right to use the Technical Information for the sole purpose of the
Subcontractor executing its obligations under the Manufacturing Agreement. To
the extent that this right applies to a given Product, the right will
automatically end on the partial termination or the non-application of the
Manufacturing Agreement to this Product. Otherwise, this licence to use will
automatically end at the expiry, for whichever reason, of the Period. At the
expiry of this licence for a given Product, the Subcontractor will give back to
the Principal the corresponding Technical Information, without keeping any copy
thereof and will destroy all internal documents with respect to or making
reference to such Technical Information.

 

9.2                     The Principal grants to the
Subcontractor, exclusively, a non-exclusive, non-assignable or transferable,
and free of charge license to use the patents necessary for the manufacturing
of the Products.

 

9.3                     The Principal grants to the
Subcontractor, exclusively, a non-exclusive, non-assignable, non-transferable
and free licence to use the Trademarks for the sole purpose for the
Subcontractor executing its obligations under the Manufacturing Agreement. To
the extent that this right applies to a given Product, it will automatically
end on the partial termination or the non-application of the Manufacturing
Agreement to this Product. Otherwise, this licence to use will automatically
end at the expiry, for whatever reason, of the Period.

 

9.4                     The licenses and the rights to use
the Industrial Property Rights granted by the Manufacturing Agreement to the
Subcontractor, during the duration or after the expiry thereof, do not grant
any property right, right of reproduction, right to register a Trademark or a
similar trademark or a trademark that might cause confusion with this
Trademark.

 

9.5                     The Subcontractor will not have any
right to apply, use or paste any Trademark, name or logo of the Principal or an
Affiliated Corporation on the Products, in conditions other than those
stipulated in the Manufacturing Agreement.

 

Article 10
:         AUTHORISATIONS

 

The Subcontractor undertakes to obtain, keep and maintain all necessary
authorisations for the execution of its obligations under the Manufacturing
Agreement.

 

15

 

Article 11
:         RESPONSIBILITY

 

11.1              The Subcontractor undertakes to bear
solely any damages resulting from faults, prejudice (including any prejudice
resulting from a loss of turnover and those resulting from the penalties of
large distributors (“hypermarchés”),
omissions, breaches and violations of the obligations under the Manufacturing
Agreement committed by its representatives, employees, agents, with the
exception of losses, costs, damages, law suits, claims due to the negligence or
the fault of the Principal or to one of its representatives, employees or
agents.

 

11.2              The Principal undertakes to bear
solely any damages resulting from faults, prejudice, omissions, breaches and
violations of the obligations under the Manufacturing Agreement committed by
its representatives, employees, agents, with the exception of losses, costs,
damages, law suits, claims due to the negligence or the fault of the
Subcontractor or to one of its representatives, employees or agents.

 

11.3              Each party shall notify the other
party in writing and without delay, of claims of Third Parties resulting from
the execution of the Manufacturing Agreement or from the Products, and each
party shall, on demand of the other party, grant assistance and reasonable
cooperation in solving these disputes.

 

Article 12
:         INSURANCES

 

The Subcontractor declares that it is insured with an insurance company
of first rang (“une compagnie d’assurance de premier rang”)
for all damage and all acts for which it might be held responsible, in the
framework of the Manufacturing Agreement. The Subcontractor undertakes to
maintain the insurance coverage until the expiry of the time limits of recourse
that third parties or the Principal might have in the framework of the
Manufacturing Agreement.

 

The Subcontractor undertakes to pay all premiums so that the Principal
can asserts its rights in its capacity as beneficiary.

 

The Subcontractor undertakes to communicate one sample of the insurance
contracts to the Principal upon the first request of the latter.

 

Article 13
:         CONFIDENTIALITY

 

The
Parties agree to keep this Manufacturing Agreement, the Technical Information
and other information provided by the Principal, as well as the operations
realised in application thereof, in strict confidence in respect of all Third
Parties, and will ensure that their staff and agents observe the same
obligation.

 

This
obligation will not apply where a Party, or an Affiliated Corporation, is
required or held to communicate information or a document relating to the
Support Agreement or a Related Agreement, by an administrative, judicial,
legal, regulatory or financial authority or a stock exchange (notably the NSEC
or NASD).

 

16

 

Similarly,
the Parties may communicate with their usual bankers, advisors, accountants,
account commissionaires, any information or document relating to the Support
Agreement or to a Related Agreement, the latter being bound by their
professional confidentiality regarding their clients.

 

Article 14
:         FORCE MAJEURE

 

At a first stage, a situation of force majeure
will suspend the execution of the Manufacturing Agreement.

 

The Principal may, as from the occurrence of a
force majeure situation which he may reasonably suspect will last at least ten (10) days,
take every measure permitting him to ensure the continuation of the
manufacturing of the Products and the Subcontracting Products, including having
the Products and Subcontracting Products manufactured by a Third Party.  The Subcontractor engages itself to cooperate
and take every measure permitting the Principal to ensure the continuity of the
manufacturing of the Products and the Subcontracting Products, including by a
Third Party, and to return the Moulds put at its disposal.

 

In the event of force majeure, the quantity of manufactured Products
during the first month will not be taken into account for the previewed quantities
set in article 6.1.  If the force
majeure situation continues longer than one month, the quantities of
manufactured Products will be taken into account for the quantities stipulated
in article 6.1 as from the second month.

 

If a situation of force majeure exists for
more than three (3) months, the Manufacturing Agreement will automatically
ipso iure and without notice be
terminated, unless the Parties agree otherwise.

 

Expressly considered as cases of force majeure
or acts of God are those usually upheld by the case law of French Courts and
Tribunals, and more specifically general or partial strikes, inside or outside
the company, or lock-out, under the condition that it prevents the normal
execution of the Manufacturing Agreement, it will be deemed to be a force
majeure case.

 

Article 15
:         DURATION AND TERMINATION

 

With respect to what is provided for in the Manufacturing Agreement, the
present Manufacturing Agreement enters into force on the Effective Date and
expires on 31 August 2007 or at a prior date on which the Principal will
be freed from his minimal obligations in accordance with article 6 of the
present agreement.

 

At least three months before the end of the Manufacturing Agreement, the
Principal can give notice to the Subcontractor to continue the Manufacturing
Agreement who remains free to accept or refuse.

 

Each Party can terminate the Manufacturing Agreement before the end of
the initial term of the Manufacturing Agreement or before the end of the
renewal by written notification to the other party:

 

17

 

(a) in the event of the initiation of proceedings for an ad hoc mandate (“ouverture d’une procédure
de mandat ad hoc”), for recovery (“redressement”)
or for judicial liquidation and if a judicial administrator (“administrateur judiciaire”) is appointed, it will be
entitled to terminate the Manufacturing Agreement in accordance with the legal
provisions with respect to collective procedures;

 

(b) in the event of voluntary dissolution or liquidation of the
other party decided by the tribunal;

 

(c) immediately, in case of failure by the Subcontractor to perform
its obligations under articles 2, 3, 4.1, 4.2, 5, 7.1 and 9 of the
Manufacturing Agreement;

 

(d) in the event of the other Party committing a breach of its
contractual obligations, with the exception of the failure by the Subcontractor
to perform one of its contractual obligations described above, and if this
failure or neglect continues for a period exceeding 30 Working Days from the
notification of such breach.

 

Article 16
:         CONSEQUENCES OF THE TERMINATION

 

16.1              Immediately after the total or
partial termination of the Manufacturing Agreement, for whatever reason, the
Subcontractor shall interrupt the manufacture and the packaging of the Products,
cease to use the Trademarks and the Patents, as well as the documents,
instructions and information, and notably the Technical Information with
respect to the Products and their manufacture, packaging, quality inspection,
manipulation, storing and send back to the Principal, without costs, all said
documents, instructions and information, without keeping copies, except for
those required by law, destroy all internal documents held in whatever format
that contain Technical Information or other information concerning the Products
and their manufacture, packaging, quality inspection, storing and certify to
the Principal the destruction in writing by a representative of the
Subcontractor.

 

16.2              The Principal undertakes to take
back all stocks of the Products and of the In-Processes of the Subcontractor on
condition that such stocks correspond to firm orders placed by the Principal
prior to the termination. The Principal will take back at its discretion the
stocks and the In-Processes of the Subcontractor that do not correspond to firm
orders received by the Subcontractor before the termination of the
Manufacturing Agreement.

 

In the event of the Principal deciding to take
back the Products and the In-Processes under the terms of article 16.2, it
will pay for these Products at the unit price provided for in Annexe 5.3,
unless the Parties decide to prolong the termination date of the Manufacturing
Agreement to allow the Subcontractor to transform the In-Processes into
Products and to pay for these In-Processes proportionally (pro rata). All stock
of Products and In-Processes not taken back by the Principal under this
article, shall be destroyed immediately by the Subcontractor, at the cost of
the latter and following the written instructions of the Principal.

 

18

 

16.3              The Subcontractor shall return the
Products Moulds lent to him within a period of eight (8) Working Days.

 

Article 17
:         DISPUTES RELATED TO TECHNICAL DIFFICULTIES

 

17.1              Each dispute or disagreement (other
than those foreseen in article 5) between the Parties exclusively with
respect to technical aspects of the manufacture, the packaging, the labelling,
the quality inspection, the manipulation and the storing, has to be submitted
to the representative bodies of the Parties or to an expert in accordance with
the provisions of article 17.

 

17.2              The representative bodies of each
Party will meet as soon as possible and within a maximum of five (5) Working
Days from the written notification of one party to the other to try to resolve
the technical dispute without having recourse to judicial procedures.

 

17.3              In the event that the Parties do not
succeed in resolving the technical dispute within fifteen (15) Working Days
from the written notice, the technical dispute will be submitted for the
examination of an independent expert appointed in accordance with article 17.4.

 

17.4              If the Parties do not come to an
agreement on the appointment of an expert within five (5) Working Days
following the request by one of the them, the expert will be appointed by the
President of the Commercial court of Paris (“Président du Tribunal de commerce
de Paris”) at the request of the most diligent party.

 

17.5              When the expert is appointed:

 

(a) The thus appointed expert will have to
(i) determine rapidly the place and the reasonable time within which he
will talk with the Parties, request the communication of the documents that are
useful to him for the resolution of the dispute and formulate observations to
the Parties and to any concerned third party and (ii) render his reasoned
decision within twenty (20) Working Days from the receipt of all information
requested from the Parties, under article 17.

 

(b) The Parties undertake reciprocally to
provide the expert with all proof, documents and information at their
possession that is useful to the expert for the understanding of the dispute.
These documents should be communicated rapidly and in any case within five (5) Working
Days from the notification of the expert requesting communication of the said
information and documents.

 

(c) If the expert has not rendered his
decision within forty (40) Working Days following his appointment, each Party
may solicit the communication of a new expert under the conditions provided in
paragraphs (a) and (b) here above.

 

(d) The decision of the expert will,
except in case of manifest error, be final and binding upon the Parties.

 

19

 

(e) The costs and expenses of the expert
will be borne by the Party in fault or in breach. In the case of shared
responsibility, the costs of the expert’s assessment will be divided amongst
the Parties in proportion to their respective responsibility.

 

Article 18
:         COSTS AND EXPENSES

 

The Principal and the Subcontractor will bear their own respective costs
and expenses incurred with a view to preparing the Manufacturing Agreement and
the realisation of the planned operations under the Manufacturing Agreement,
including, without being limited thereto, the fees and disbursements of the
advisors and offices of accounting experts and possible agents or
intermediaries.

 

Article 19
:         APPLICABLE LAW AND COMPETENT JURISDICTION

 

All disputes with respect to the conclusion, execution or interpretation
that would arise as a result of the Manufacturing Agreement will be resolved in
accordance with French law.

 

All disputes with respect to the conclusion, execution or interpretation
of the Manufacturing Agreement will, in first instance, be submitted to the
jurisdiction of the Commercial Court of Paris.

 

Article 20
:         NOTICES

 

All notices and other communications made or exchanged between the
Principal and the Subcontractor shall be done by registered letter with
acknowledgment of receipt or by hand delivered letter and countersigned as
acknowledgment of receipt by the addressee or by extrajudicial act to the
addresses and persons mentioned hereafter or to any other address or person
notified in the forms of the present article.

 

For SAMSONITE

Mr Marc Matton

27,
rue de la Rochefoucauld

75009
Paris

 

With
copy to:

Mr
Frédéric Boucly

Lexens

128,
Boulevard Haussmann

75008
Paris

 

20

 

For
the Principal

 

SAMSONITE EUROPE NV

Mr Marc Matton

Westerring
17,

9700
Oudenaarde

Belgium

 

With
copy to:

Mr
Frédéric Boucly

Lexens

128,
Boulevard Haussmann

75008
Paris

 

For the Purchaser:

 

Mr
Jean-Jacques AUREL

HB
GROUP

Rue
de l’Industrie

L-3895
Foetz

 

With
copy to:

Fauvet
La Giraudière & Associés

Avocats à la Cour

92 avenue d’Iéna

75008 Paris

 

For
the Corporation:

 

Mr Jean-Jacques AUREL

At
the Corporation’s seat

 

With
copy to:

Fauvet
La Giraudière & Associés

Avocats à la Cour

92 avenue d’Iéna

75008 Paris

 

Article 21
:         MISCELLANEOUS

 

Failure to exercise or delay in the exercise by the beneficiaries of a
right or a recourse that is granted to them by the Manufacturing Agreement,
shall never constitute a waiver of this right or recourse. Equally, the
punctual or partial exercise of any of their rights or recourses will not
prevent the later or different exercise of these rights or recourses.

 

The rights and recourses granted by the present (agreement) are
cumulative and come in addition to the other rights and recourse provided by
law.

 

In the event that one or more provisions of the Manufacturing Agreement
is considered illegal, non written or inapplicable, the Manufacturing Agreement
shall be interpreted as if it 

 

21

 

did not contain the said provisions and the invalidity or the
inapplicable nature of the said provisions shall not affect the validity of the
other provisions of the Manufacturing Agreement, which will remain valid and in
full force.

 

Signed in Paris on 31 August 2005 in 4 originals

 

 

	
    /s/ Marc Matton

  	
   

  	
    s/s
  Jean Jacques Aurel

  	
   

  
	
  Samsonite Europe NV

  	
  Artois Plasturgie

  
	
   

  	
   

  
	
    /s/ Marc Matton

  	
   

  	
    s/s
  Jean Jacques Aurel

  	
   

  
	
  Samsonite SAS

  	
  HB Group

  

 

22

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